Wealthsimple was founded seven years ago by Mike Katchen, a 33-year-old whiz kid from Toronto whose robo-advisor has put Canada’s “Big Five Banks” on notice, to the extent that both the Bank of Montreal and the Royal Bank of Canada promptly launched their own competing robo-advisor products two years after Katchen.
The company has even received backing from famous Canucks like Ryan Reynolds, Kelly Olynyk, and Michael J. Fox. But Katchen now has one of the biggest celebrities in his corner names with Wealthsimple’s with recent $4 billion valuation: fellow “T-Dot” native, Drake.
On Monday, it was announced the company hit the milestone after the latest fundraising round, led by Greylock Partners and Meritech Capital Partners, brought in $610 million.
A large part of that investment will be put towards equipment and building out the company to support its growing client base, particularly in light of the fact that the pandemic has contributed to a booming interest in retail investing. “We’re interested in infrastructure like that — infrastructure companies across the breadth of financial services — and then products that we’re excited about as part of the ecosystem,” Katchen said in an interview with Bloomberg. “We’re building a business for the very long term, and we want some more time to make sure that we make those investments before introducing those sorts of pressures so we build the business in the right way.”
As a millennial who has enjoyed success in the financial industry, Katchen also wants to connect with his peers and demystify the market for them. He believes a large part of people’s cluelessness comes from focusing on the wrong questions as well as unnecessarily perplex tools to address straightforward issues.
“I think we spend too much time talking about financial education and too little on building better financial products,” he told the Toronto Star last November. “The reason that we need so much financial education is because the products are too complicated, and if people use them without understanding them, they get into trouble with things like excessive amounts of credit card debt. We should be building simple, transparent products, and that’s totally ignored by the industry.”
With this recent cash infusion, Katchen looks to spread beyond his home country and empower others in securing their futures. “More than two million Canadians use Wealthsimple to grow their money, file their taxes, pay their friends, and make their financial lives better,” he said on his website. “This investment will fuel our growth so we can reach millions more and ensure that everyone has access to the simplest, most powerful financial products and services, no matter who they are or where they are in their financial lives.”
Oh, and Katchen plans to party it up with the 6 God, too. “Drake,” he wrote, “see you later at my house.”