Treasure Financial, a Silicon Valley-based RIA focused on cash management for businesses, recently raised $7.5 million in a funding round led by venture capital firm Ventura Capital, a previous investor in the firm.
PayPal co-founder Peter Thiel, who is also a previous investor, also joined the round, along with other unnamed investors.
According to PitchBook, Treasure Financial, which was founded in 2018, had previously raised $7 million in seed funding.
In the wake of this year’s banking crisis and the Fed’s recent interest rate hikes, Treasure has seen explosive growth. According to the company, it has more than doubled the clients it serves to about 300 since the beginning of the year, and it has almost doubled its assets under management over the same period, to roughly $500 million.
“We were so impressed by the instant traction and hyper-growth of the Treasure product with all types of businesses,” said Mo El Husseiny, managing partner at Ventura Capital, in a statement. “Treasure meets Ventura’s investment criteria of being a business whose offerings and management team have proven traction, and [that provides] something that the world needs.”
Unlike most RIAs that serve high-net-worth clients or individual investors, Treasure focuses on managing cash assets for businesses, which it likens to the internally built treasury departments at Apple and Airbnb. “We’re basically a robo-advisor for businesses,” Treasure co-founder and chief investment officer Ben Verschuere told RIA Intel in an interview in April.
The company says on its website that companies like Treasure, which hold client assets in custodial accounts, are a “safe place to invest idle cash,” and it bills itself as an alternative to holding cash above the maximum $250,000 insured by the FDIC at banks.
“With $55 trillion in cash sitting idle in small to medium businesses, SMB deposit accounts are one of the last unserved bastions of mega-capital,” El Husseiny said. “But as we have recently witnessed, they can [also] be the most vulnerable to systemic bank crises. Treasure Financial’s product significantly decreases risk while materially increasing revenue — every small and medium business should be using Treasure for treasury management.”
Treasure said that this fund raise will bolster its “ongoing commitment to creating cutting-edge treasury management tools for businesses.”
Treasure recently unveiled a new product, Treasury API, which allows companies to embed Treasure’s entire suite of products directly into their website or platform. Verschuere told RIA Intel that they decided to focus on creating a white-label product after a few fintech companies and banks asked about using Treasure technology. Most of the $7.5 million raised will go to building out and supporting Treasure’s new API product, said Verschuere.
“Overall, I think the big picture is that there is about $8 trillion in uninsured deposits. And at the moment, we’re seeing a big flight from that $8 trillion in uninsured deposits toward a treasury-like product, which is basically what Treasure is building,” Verschuere said. “We’re building for those businesses — to help them safeguard their capital and get access to higher yield — and that’s been a big tailwind [for us]. And the big partners that have reached out to us on the API side are seeing it from their own customers as well.”