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Fruitful, a startup dedicated to promoting healthy financial habits, has emerged from stealth mode with $33 million in funding. In a time when rising inflation is causing financial challenges for millions of Americans, Fruitful aims to offer affordable access to financial planning services, ensuring that these services do not deplete individuals’ savings.
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Over the past 18 months, Fruitful successfully secured $33 million in equity funding through a combination of seed and Series A rounds. The $8 million seed round was led by Emigrant Bank, while the $25 million Series A was spearheaded by 8VC, with both funding rounds having been kept confidential until now.
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In addition to this, the company raised an additional $4 million through a convertible note, which was oversubscribed as part of the Series A.
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Fruitful boasts an impressive roster of backers, including Lux Capital, Founders Fund, Elad Gil, Hero founder and CEO Kal Vepuri, as well as founders from Brex, Gemini, Tagomi, and more.
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In essence, Fruitful, set to launch this autumn, will offer its members access to certified financial planners, many of whom have extensive experience in the financial industry with companies like Fidelity. These “guides” will provide personalized financial advice to members for a monthly fee of $98, covering a wide range of financial topics, from budgeting and savings to investments, 401(k)s, home buying, college funds for children, and tax planning. Currently, Fruitful is in a live beta phase.
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“We’re working to build what we believe will be the first financial wellness membership platform,” said Josh McManus, co-founder and CEO of Fruitful.
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Members will access Fruitful’s services through a mobile app, where they can engage in live chats or schedule video calls with their financial guides. The startup also promises exclusive content on relevant financial subjects.
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McManus emphasized that the $1,200 annual cost for financial advice is significantly lower than the 1% fee often charged on assets under management, typically requiring a minimum asset base of $250,000. He stated, “We’re bringing the price point down to increase accessibility. Half of people making over $100,000 are still living paycheck to paycheck.”
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One of Fruitful’s key differentiators is its subscription model, free from passive management fees or the sale of third-party products and services. McManus believes this approach provides “low to no bias” financial guidance, catering to a substantial segment of people who earn high incomes but have yet to accumulate significant savings, making them ineligible for private client banking services.
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Notably, Fruitful was launched in collaboration with Emigrant Bank, a strategic advantage according to McManus, as it provides the startup with access to robust operational, technical, and regulatory infrastructure.
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Investors are enthusiastic about Fruitful’s mission. Kimmy Scotti from 8VC praised the company’s “service-first approach” as highly distinctive in a landscape filled with subpar automated financial experiences.
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Elad Gil described Fruitful as a “consumer-aligned financial services platform” with a talented leadership team and a unique partnership with Emigrant Bank, positioning it well to revolutionize personal finance services in the best interests of the customer.