Northwestern Mutual to acquire online financial planning provider LearnVest
(This is a developing story)
According to the Wall St. Journal, Northwestern Mutual Life Insurance Co., said it would acquire New York-based online financial planning startup LearnVest Inc.
Terms of the deal were not disclosed.
Here’s your Too Long;Didn’t Read (TL;DR) summary:
- At the time of acquisition, LearnVest had 10,000 premium clients who pay a one-time setup fee of $299 and $19/month ongoing. That’s at best $2.28 million in annual revenue plus $2.99 million in non-recurring one time setup fees.
- LearnVest received $69 million of funding in five rounds from 15 investors (via Crunchbase)
- LearnVest for Work, a “corporate financial wellness program” had another 25,000 clients. Employers paid or subsidized access to LearnVest planners for employees.
- LearnVest employs 150 planners in New York and Arizona. Assume an “average” salary of $60,000 and you have an annual burn rate of $9 million (hat tip @MichaelKitces).
- For now, LearnVest employees will not become advisers for agents of Northwestern Mutual
@FeeOnlyIndy 150 employees at @LearnVest is a helluva burn rate. "Just" $60k salary average is $9M/year? @BillWinterberg
— MichaelKitces (@MichaelKitces) March 25, 2015
More reactions to the potential for conflict between LearnVest’s financial planning advice delivery and LearnVest’s ownership by a retirement plan and insurance provider are in this InvestmentNews article by Darla Mercado.
