Morningstar Inc. has invested $6.75 million in HelloWallet LLC, a Washington-based company that helps employees track their retirement savings, to become the 3-year-old startup's biggest owner outside management.
The Chicago-based investment research company was part of a group that plowed a total of $12 million into HelloWallet in the company's second major round of funding, the companies said in a news release.
Morningstar owns a 15% stake in HelloWallet as a result of the investment, Morningstar spokeswoman Margaret Kirch Cohen said. Existing investors, which include Revolution Ventures and Grotech Ventures, also chipped in on the new funding, as did the Telecommunications Development Fund and other new investors.
Founded by Matt Fellowes, a former fellow at the Brookings Institution, HelloWallet plans to use the money to expand its client base. It's also moving to a larger Washington office in May, a spokesman said.
HelloWallet provides personalized financial guidance to 300,000 subscribers, giving them savings recommendations, automated analyses, spending and goal tracking, and alerts for financial “threats and opportunities,” according to the company.
Morningstar and HelloWallet will co-market their services to employers and 401(k) providers initially and further integrate their services in the future, the companies said in the release.
“HelloWallet offers a unique service, based on behavioral theory, that we haven't seen anywhere else in the market,” said Brock Johnson, who leads Morningstar's retirement solutions area.
Lynne Marek is a writer for Crain's Chicago Business, a sister publication of Pensions & Investments.