Fount, a robo-advisor startup in South Korea, has raised a $33.4 million Series C round to beef up its machine learning-based platform development and hire staff.
The latest round was led by Hana Financial Investment, along with Nice Investment. Returning backers Smilegate Investment, KT Investment, Shinhan Capital and Korea Development Bank also participated.
The Series C brings its total funding to about $58.5 million, and the company’s valuation is now estimated at $209 billion, CEO Youngbeen Kim told TechCrunch.
The company will continue to invest in its technology development for the next three years, about an additional $85 million (100 billion won), Kim added.
Founded in November 2015 by Kim, Fount launched its first beta robo-advisor service in February 2016. The following month, Jim Rogers, an advisor of Fount, invested in the company.
After gaining regulatory approvals for advising investment in November 2017, Fount launched its mobile app in June 2018.
The pandemic spurred the trend that people set up an emergency fund or create an investment portfolio to grow their wealth and save for retirement through contactless investment services such as robo-advisers. South Korea's three robo-adviser startups, including Fount, exceeded a total of $1 billion in assets under management in January 2021, up 402.9% year on year, based on a local media report.
Fount surpassed $730 million assets under management as of March 2021. As per its press release, its core market is people aged 20-49, including about 66.8% of millennials.
Its AI-powered platform invests on users’ behalf by using algorithms and data for people who know they need to invest money to grow their wealth but don’t know much about investing.
Fount’s AI-based BlueWhale product analyzes more than 52,000 cases of global economic data and market indices and automatically proposes a customized and diversified portfolio that it can later rebalance as necessary.
The company offers its robo-advisor service to approximately 20 South Korea-based B2B clients, including the lead investor Hana Financial investment, Samsung Life Insurance, MetLife and Hyundai Motor Securities. The company is in talks with additional financial companies for having partnerships. It also claims that it has 260,000 registered users as of June 2021.
Global robo-advisors assets under management are projected to increase to $2.8 trillion in 2025 from $1.37 trillion in 2021, based on its statement citing Statista report. South Korean robo-advisors’ assets under management are expected to grow up to $25 billion in 2025 from $8.36 billion in 2021.
When asked about overseas expansions, Kim said it focuses on the home market now and does not have a concrete plan for global penetration.