Episode summary
Sarah Levy: From the Entertainment Industry to CEO of Betterment | At Barron's
At Barron's
· · Hosts: Andy Serwer · Guests: Sarah Levy
Summary
Betterment is positioning itself as a broad wealth platform for the millennial generation, with retail investing, advisor solutions and a 401(k) business tied together by a goal of expanding access to financial advice. Sarah Levy said the company has moved well beyond its robo-adviser roots and now serves a million customers with $56 billion in assets under management.
Levy argued that Betterment competes on fiduciary alignment, technology and customer experience, with diversified revenue streams that include a 25 basis point wrap fee on retail AUM plus subscription-like fees in its B2B businesses. She said the company has reached profitable scale and has been able to use that cash flow to invest in new growth vectors.
On products and markets, Levy said Betterment is leaning into more flexibility for customers, including more self-directed trading later in 2025, while keeping its core managed portfolios and tax optimization focus. She said the firm is selective on crypto, offering access mainly through ETFs and recommending that customers keep crypto to no more than 5% of assets. On Washington, she said crypto regulation matters less than retirement policy and data portability rules such as 1033, which she sees as important for innovation.
Key takeaways
- Sarah Levy said Betterment now serves a million customers and $56 billion in assets under management, with retail investing, adviser tools and 401(k) services under one brand.
- Levy said Betterment earns a 25 basis point wrap fee on retail AUM and also uses recurring fees in its adviser and retirement businesses.
- She said the company’s edge is fiduciary alignment and tax optimization, not just being an early robo-adviser.
- Levy said Betterment has bought pieces of three robo competitors, including Marcus Invest, Elvest and Wealthsimple’s U.S. business, because scale is the key hurdle.
- She said Betterment will add more self-directed stock buying later in 2025, starting first in the adviser channel.
- Levy said Betterment’s crypto offering is limited and generally via ETFs, with a recommendation that customers keep crypto under 5% of assets.
Notable quotes
“we now have a million customers and 56 billion in assets under management”
“we are a fiduciary first and foremost, which means we make money when our customers succeed”
“We charge 25 basis points right flat out”
“we've achieved profitable scale and the retail business is thriving”
“Don't put more than 5% of your assets in this in this uh in crypto”
How the episode opens
Hello everyone and welcome to At Barrens. I'm Andy Serwart and welcome to our guest Sarah Levy, CEO of Betterment. Sarah, nice to see you. — Thanks for having me. — So about 15 years ago, Betterman had kind of a coming out party at a TechCrunch New York um event. That's a while ago. today. What is Betterment all about? How would you describe the company?
So, Betterment is a wealth platform for the millennial generation and we are building what what I aspire to be the definitive wealth brand for this generation across really three businesses. A retail investing business, an advisor solutions business, which is about a platform for adviserss and a retirement 401k business. And the sort of unifying idea behind the three businesses is the idea of expanding access to great financial advice.
You know, I mentioned this 15 years ago because it seems like Betterment's a new company, and I guess it sort of is, but you know, you're getting some years under your belt there. What did the company start out as? I know you don't like that term robo adviser, right? But that's what it kind of did start out as.
Yes, we were we were the OGO robo adviser. So we now have a million customers and 56 billion in assets under management. But our roots were really about introducing first-time investors to um really to how to invest.
We we would have said right at that time, but using automation and tax optimization to help investors with diversified portfolios keep more than what they make, right? And so it's not what you make, it's what you keep. And so this idea of how do you use technology to lower the costs and expand access is kind of where we started.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- crypto
- financial advisors
- legislation
- robo-advisors
- wealth management
Companies and tickers mentioned
- Betterment
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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