FutureMoney
Setting the Scene
The U.S. is facing a growing generational wealth gap, with millennials and Gen Z expected to fare worse financially than their parents.
To make matters worse:
Over half of U.S. parents have little to no savings for their children, leaving families vulnerable to long-term financial insecurity.
There is no financial product specifically tailored to help parents easily and tax-efficiently build generational wealth for their children.
This week’s company makes it easy for parents to regularly invest small amounts of money into a special tax-free account for their kids.
In a Sentence
FutureMoney is a groundbreaking fintech platform that empowers parents to make recurring contributions to build generational wealth for their children through its flagship product, the Junior Roth IRAâ„¢.
Recurring Contributions: Parents can make modest, consistent deposits (starting at just $10 per week) that have the potential to grow into significant long-term investments through the power of compounding returns and tax-free growth
Junior Roth IRAâ„¢: A proprietary, tax-advantaged investment account designed specifically for minors, offering all the benefits of a traditional Roth IRA, such as tax-free growth, without the usual income requirements.
Bulleted Version:
- Similar to how Robinhood democratized stock trading for everyday investors, FutureMoney democratizes generational wealth building for families.
The Basics
- Headquarters: Boston, MA
- Investors:
Flybridge, Hustle Fund, Serac Ventures, 1528 Investments, and others
- Funding amount: $2.6M
- Business model: Subscription fee ($48 annually) for accounts under $20K and a 0.25% AUM fee for accounts over $20K
- Early traction: 15,605 downloads, 5,503 users, $543M in projected AUM, and 2 B2B partnerships launching in 2025.
Due Diligence
WHAT WE LIKE
Market Opportunity: With 72.5M minors in the U.S., Future Money taps into an enormous and underserved customer base.
Closing the Gap: Only 61% of Americans are not investing in stocks or mutual funds, and over half of parents have little to no savings for their kids, highlighting the critical need for Future Money's solution.
Trademarking Advantage: Future Money has trademarked its flagship Junior Roth IRAâ„¢, creating a significant barrier for competitors who will have the opportunity to white label the platform instead.
POTENTIAL RISKS
Regulatory Dependency: The company’s core product relies heavily on the Secure Act 2.0 legislation, and any unfavorable changes could disrupt its business model.
Economic Uncertainty: Recessions or financial instability could reduce families’ willingness to invest in their children's futures, potentially affecting user growth and platform retention.
Competitive Expansion: Established fintechs and traditional banks may develop similar offerings, intensifying competition in the child-focused investment space.
Founder Profile
Phil Barrar, CEO: A fintech entrepreneur with a history of success, scaled and exited his previous company for $65M.
Dave Fortin, CFA: Over a decade of experience in robo-advisory, self-directed trading, wealth management, and founding team member of Tactex.
To request an introduction to the founder, respond to this email.
Comps
Acorns Early: Backed by BlackRock, Headline, Bain Capital Ventures, Greycroft, and others.
UNest: Backed by The Artemis Fund, ExpertDojo, Sum Ventures, and others.
Wealthfront: Backed by UBS, Tiger Global Management, Spark Capital, Index Ventures, and others.
Carry: Backed by Vibe VC, Accomplice, Hustle Fund, Roadrunner Ventures, and others.
Why FutureMoney
By helping parents regularly invest small amounts through their flagship Junior Roth IRAâ„¢ product, FutureMoney creates an easy and tax-efficient way to build generational wealth for children and compound their impact.