NextCapital Receives $30 Million Growth Investment Led by Francisco Partners

September 22, 2020

Business Wire

Investments from FP Credit, Oak HC/FT and IA Capital Group to advance retirement income capabilities and growth partnerships

NextCapital, the leader in enterprise digital advice, today announced $30 million in growth financing, bringing the company’s total funding to $85 million. The financing was led by FP Credit, the credit investment arm of Francisco Partners, a leading global investment firm. Oak HC/FT and IA Capital Group also participated in the capital raise.

NextCapital enables its commercial partners to rapidly bring to market a cost-effective, full-stack digital advice solution that is built to support the demanding requirements of large enterprises. The company enables scalable financial planning, advice, and managed accounts across leading financial institutions.

“This funding advances our mission to help everyone retire successfully,” said NextCapital Chief Executive Officer and Co-Founder John Patterson. "Our partners are equally essential to the success of this mission, so we are excited to use this funding to further invest in our Partner Success program. This capital raise also allows us to extend our best-in-class workplace and rollover managed advice platform, as well as expand our retirement income offering.”

“NextCapital is at the forefront of the digital transformation sweeping the $8 trillion defined contribution market,” said Peter Christodoulo, partner at Francisco Partners. “Especially in the current economic climate, there is an urgent need to give Americans institutional-grade advice both in the accumulation phase for younger workplace savers and during the decumulation phase for older investors.”

NextCapital’s multi-channel solution supports defined contribution, IRA rollover, and retail accounts. Other key configuration features include:

  • Custom user experience and ongoing engagement
  • Configurable investment methodologies and advisory roles
  • Self-service and advisor-assisted service models
  • Plan advisor enablement
  • Integrations with 401(k) recordkeeping systems and retail custodians

“NextCapital is unique among its competitors in their ability to work with all firms in the retirement ecosystem, from large asset managers to recordkeepers to large advisory firms. NextCapital can build completely customized managed advice solutions for their partners that fulfill each institution’s unique requirements,” said Alois Pirker, research director for Aite Group's wealth management practice. “NextCapital’s platform addresses the needs of enterprise partners across the entire retirement landscape.”

Francisco Partners was advised by Akin Gump Strauss Hauer & Feld LLP as its legal advisor.

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