Betterment to Buy Sallie Krawcheck’s Ellevest Robo Accounts
Ellevest plans to focus on its private wealth management and financial planning business lines going forward.
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One of the first independent robo-advisors built for women is selling its automated accounts.
Ellevest, a women-focused wealth manager with more than $2 billion in assets under management, said it will sell its automated investing service to Betterment, one of the world’s largest robo-advisors with more than 900,000 customers. The New York-based automated investment platform now plans to focus on its private wealth management and financial planning businesses.
“The mission of Ellevest is now and will always be to put more money in the hands of women,” a spokesperson said. “That is not changing. Just how we do that is evolving.”
The More The Better-er
It’s just the latest deal for Betterment, which has been on a tear in recent years. The digital advisor has gobbled up digital investing businesses big and small:
- Last year, Goldman Sachs sold its Marcus Invest accounts to Betterment after it once again failed to make waves in the retail sector.
- And in 2021, Betterment acquired Wealthsimple’s US accounts in a deal that included roughly $190 million in assets and some 17,000 clients.
Betterment is looking to use its Ellevest purchase to cross-sell products and services to new clients, said Vijay Raghavan, former senior analyst at Forrester. “These customers are already digitally savvy and delegating their investments to an investing algorithm,” he told The Advisor Upside. “As they grow older and their lives become more complex, they will seek more customized advice, which Betterment offers.”
What Women Want. Ellevest was founded in 2014 as a way to fill an industry void and better serve women investors. Co-founder Sallie Krawcheck stepped down from her CEO position in December due to health concerns, but the firm expects to continue focusing on its mission of serving the needs of women investors. Betterment will only acquire automated investing accounts and assets from Ellevest, not its technology or employees, according to the release. Clients will have the option to opt out of the move.
“Ellevest’s digital clients, and women/everyone, are well-served by an industry leader like Betterment, especially with a CEO like Sarah Kirshbaum Levy,” the Ellevest spokesperson told Advisor Upside.
