Goldman Sachs Snags Austin Fintech Startup Honest Dollar
Austin — Honest Dollar, an Austin, TX-based fintech company that provides retirement tools for small businesses, has been acquired by Goldman Sachs.
The acquisition was made by the investment management arm of Goldman Sachs, which invests $1 trillion for institutions and wealthy individuals Terms of the deal, which was announced Monday and is expected to close in the second quarter, were not disclosed. Honest Dollar will remain in Austin.
“Honest Dollar has created a simple solution to a complex retirement savings problem,” Timothy O’Neill and Eric Lane, co-heads of investment management at Goldman, said in a statement. “Together, we have the potential to help millions of people achieve their investing goals.”
Honest Dollar was founded last year to help small and medium-sized business provide employees with retirement benefits through web and mobile applications. Typically, only about 14 percent of such businesses provide benefits, most of them unable to afford to do so. Honest Dollar connects these businesses with IRAs or Simplified Employee Plan, or SEPs. The company charges employers between $8 to $10 a month per employee.
“We provide a very clean financial product at a fair price,” Hurley told me last month. “We are a software platform rather than a financial services company, so there are no extra basis points, no wrapper fees.”
The company had previously raised $3 million in seed funding through a range of investors, including Expansive Ventures; Formation8; Core Innovation Capital; Vikram Pandit, the former CEO of Citigroup; Mint founder Arron Patzer; and Will.i.am, the founder and frontman of the pop group The Black Eyed Peas.