In immediately’s episode, I’m joined by Gaurav Sharma, CEO and Co-Founding father of Capitalize a venture-backed fintech firm in New York targeted on the retirement financial savings market.
Gaurav and I cowl a spread of matters, together with:
The Dimension of the 401K Rollover Situation:
After working in monetary companies for 10 years and at a variety of companies, Gaurav gained acute data of the U.S. 401K financial savings difficulty — when employees change jobs, their 401K accounts don’t change with them. Coming from Australia additionally helped Gaurav acquire perspective on what a extra easy, obligatory financial savings account seems to be like. Having grown up round entrepreneurs, Gaurav determined to deal with this downside himself. Capitalize has discovered that 15–21M individuals change jobs and 401K accounts per yr, and roughly 1/third of these individuals money out their accounts, ($100M in whole) paying taxes and penalties on their cash. One other 3–4M individuals depart their cash behind for an prolonged time period. With these inefficiencies, Capitalize has calculated that there are $1.35T in property sitting inside forgotten 401Ks.
Capitalize’s Product and Buyer Base:
Capitalize provides a web based expertise that helps shoppers discover their outdated 401K accounts, evaluate and choose the proper IRA, and deal with the rollover course of on-line by way of top-tier consumer service to ensure the cash will get consolidated into 1 new account. At the moment, Capitalize predominantly serves people of their late twenties by mid-30s which have had 3–5 jobs since graduating. Nevertheless, Gaurav has seen this consumer base develop past the early adopters, right into a extra mainstream viewers. The success of this product has made Capitalize one in every of Time’s Finest Innovations in 2021.
The Fundraising Course of:
Capitalize raised its Sequence A spherical in February of 2021 from a variety of outstanding fintech traders, together with Canapi Ventures (lead), Bling Capital, Greycroft, RRE Ventures and Walkabout Ventures. Gaurav credit investing in private relationships with VCs, and maintaining them appraised of the progress Capitalize was making, for the success of their Sequence A spherical. Whereas the fundraising course of is rarely straightforward, Gaurav and the group felt like they had been in a position to streamline it as a lot as doable.
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Gaurav Sharma:
Gaurav leads Capitalize’s mission to assist individuals save for retirement. Earlier than founding Capitalize, he labored for among the best-known monetary establishments, together with JP Morgan, UBS, Morgan Stanley, and as an investor at well-known hedge fund Greenlight Capital. After seeing how laborious it’s for most individuals to grasp their retirement accounts, he determined to construct an organization that makes it simpler. An Australian by beginning, Gaurav lives in New York along with his spouse and their adopted pet, Lorenzo.
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In regards to the Creator:
Anirudh Singh is a second-year MBA Candidate at The Wharton Faculty, the place he’s a part of the Wharton FinTech Podcast group. He has a ardour for financial improvement, enterprise capital, monetary companies, and all issues FinTech. Don’t hesitate to succeed in out with questions, feedback, suggestions, and alternatives at singhan@wharton.upenn.edu.
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