Advisor Referral Business Helps Lift SmartAsset to $1 Billion Valuation

“SmartAdvisor has been the key driver behind revenue growth,” SmartAsset co founder and CEO Michael Carvin told RIA Intel.

(Illustration by RIA Intel)

(Illustration by RIA Intel)

SmartAsset, a website and software company that reaches more than 100 million people each month, has transformed its users into well-qualified referrals for financial advisors and significantly grown its revenue. For those efforts, investors rewarded it. The company said Thursday it was valued at more than $1 billion after a new round of funding.

TTV Capital, an existing investor, recently led SmartAsset’s $110 million Series D round of funding. Other investors in the round included Javelin Venture Partners, Contour Venture Partners, Citi Ventures, New York Life Ventures, North Bridge Venture Partners, and CMFG Ventures.

After its $28 million Series C round led by Focus Financial Partners in 2018, SmartAsset built over 300,000 public profiles of wealth managers and created a lead generation tool for financial advisors called SmartAdvisor.

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The new business focused on wealth managers has been successful and helped SmartAsset grow its annual recurring revenue by 10 times to almost $100 million, the company said Thursday.

Many advisors now use the service, including some at Focus Financial’s RIAs and LPL Financial, which it recently partnered with.

“We are not sharing specifics, but SmartAdvisor has been the key driver behind revenue growth. We now have thousands of advisor partnerships and growth cannot be attributed to any one partner,” SmartAsset co-founder and CEO Michael Carvin told RIA Intel in an email.

Financial advisors and firms on its wealth management referral platform, SmartAdvisor, now generate $1.5 billion in “new, closed assets under management” per month, significantly more per month than last year. In May of 2020, Carvin told RIA Intel he expected SmartAdvisor would help advisors add an aggregate of $10 billion under management in all of 2020.

“SmartAsset is quickly expanding its lead in one of the largest markets in the U.S. by providing an incredibly valuable resource for both consumers and financial advisors alike. The company helps millions of people make better financial decisions while simultaneously enabling advisors to grow their business,” Mark Johnson, partner at TTV Capital, said in a statement about the latest round of funding.

A SmartAdvisor program called “Live Connections” with a concierge team that introduces advisors to prospective clients over the phone, has also contributed to the success of the new business, the company said in a statement. Last year, Carvin said about 20% of “Live Connections” resulted in a client relationship, which he understood is comparable to the success rates of referral programs of RIA custodians.

SmartAsset, a Y Combinator company founded in 2012, has raised a total of $161 million, according to PitchBook. It has 202 full-time employees and plans to grow its headcount by more than 75% in 2021.

Michael Thrasher (@Mike_Thrasher) is a reporter at RIA Intel based in New York City.

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