Chicago startup M1 Finance hit a major milestone this week---it now has more than $1 billion in assets on its platform. And the company says it's reached that mark faster, and with less venture capital funding, than some of its peers.
M1 announced Wednesday that its investing app has surpassed $1 billion in assets under management, having done so in just 41 months. That's quicker than competitors like Betterment, Wealthfront, Acorns and Stash, the company said, all of which have raised more money in outside funding. M1 has raised just over $26 million to date.
Founder and CEO Brian Barnes said in an interview that he attributes M1's growth to a "Chicago style" mindset, which has led the company to focus on organic user growth and avoid overspending on marketing.
"Hitting $1 billion does put us into sort of a rarefied air in fin-tech," he said. "We’re proud we’ve done it the 'Chicago way,' where we’ve (hit $1 billion in assets under management) in a shorter amount of time with less capital raised."
Founded in 2015, M1 has created a no-fee investing app that offers users an automated brokerage, portfolio lines of credit and digital banking. The fast-growing startup said it added 32,000 retail brokerage accounts in the month of January alone.
Its team has grown quickly, too. M1 doubled its headcount in 2019 and now has 55 employees. It moved into a new office space at 200 N. LaSalle St. last month, which Barnes said can hold around 100 employees. And while the company was able to crack the $1 billion mark with relatively little VC money, Barnes said M1 expects to close its Series B round of funding later this year.
M1's growth comes as the fin-tech industry overall has experienced a string of large acquisitions in the last several months. Visa bought Plaid for $5.3 billion, PayPal bought Honey for $4 billion, and Intuit bought Credit Karma for more than $7 billion.
