Qapital, one of a slew of mobile applications trying to make it easier for users to save money (and spend it more wisely), has raised $30 million in fresh financing as it expands beyond savings to offer investment advisory services.
Since its launch in the U.S. in 2015, Qapital has amassed roughly 420,000 users that have saved nearly $500 million on the platform, according to the company.
But Qapital is more than just a Digit-style savings tool these days. The company has also folded in Qapital Spending through a linked Visa Debit Card that works with money saved through the app — as well as a budgeting tool called Qapital Weekly Spending Target.
The company now has designs on the robo-investment market through Qapital Invest, a new product that Qapital expects to roll out before the end of the year.
Financing that push into investment advisory is the $30 million warchest the company just raised from big Nordic investment firms Swedbank Robur, Norron, SEB Stiftelsen and Athanase, with additional participation from the Nordic venture capital firm Northzone.
Qapital’s approach combines tools that have been rolled out into financial services verticals by startups like Digit, Acorns, Betterment, Wealthfront and Clarity Money (which was recently acquired by Goldman Sachs).
Using certain principles of behavioral economics, Qapital tries to encourage users to save money towards goals and make better financial choices overall.
The company’s executive team even includes the renowned fintech startup whisperer Dan Ariely, who serves as chief behavioral economist for Qapital when he’s not moonlighting as the James B. Duke professor of Psychology and Behavioral Economics at Duke University, and a New York Times best-selling author.
Ariely’s theories helped shape Qapital’s “rules” and “goals” approach to money management, where users set short term and long term goals for themselves and then create spending rules to help them achieve those goals. Rules can vary from “save a dollar every time I buy a coffee” to “save $2 when anytime I use a credit or debit card”.
“Building personal banking products that people love is hard, and traditional banks to date haven’t done enough to inspire and engage their customers,” said Pär Jörgen Pärson, Chairman of the Qapital Board and General Partner of Northzone, in a statement. “Qapital understands that through building a great product that is easy to use and winning its customers’ trust, we will inspire happiness and empower people to meet their goals.”
The new capital should provide some defensibility for Qapital as the industry looks to head into a period of consolidation.
As George Friedman, Qapital’s chief executive and co-founder noted in an email, “banks haven’t done enough to inspire and engage customers, and … banks simply can’t match the innovation speed of start-up challengers.”
With the Goldman Sachs acquisition of Clarity Money, Friedman says,”there is real demand among consumers for financial products with financial management tools built in.”
