Sarah Levy is the CEO of Betterment, the largest independent digital investment advisor. Fintech Explained sat down with Sarah for a wide-ranging Q&A on Betterment’s mission of opening up investment opportunities for all and the future of the financial technology industry.



Here’s our full Q&A with Sarah Levy:



Q: Tell us about Betterment’s mission and the gap in the market you set out to fill.


I love our simple and elegant mission: to make people’s lives better. The company was the first “robo advisor” on the market, and is now the largest independent digital investment advisor with more than a decade of experience helping hundreds of thousands of customers build wealth and plan for retirement.


When Betterment was founded there was an enormous opportunity in the market to bring digital-first investing and savings tools to consumers. Banks and traditional wealth managers had not innovated in decades and their services were costly, complicated, and lacked transparency. Today, the whitespace is even larger, with small businesses, wealth management firms, and investment advisors looking for ways to super-serve their employees and customers with affordable, digital investment solutions. Betterment has built a platform to deliver these solutions at scale.


Q: How does Betterment drive financial inclusion and deliver positive outcomes for your consumers?


At Betterment, accessibility is a foundational pillar of our platform — we believe anyone should be able to save and invest with expert advice at a reasonable fee. We take a lot of the complexity and guesswork out of the investing process, making it easy for our customers to start their investing journey with us, set up goals, and stick with them over the long term. We are a fiduciary, which ensures our customers’ best interests are prioritized when we offer advice and construct investment portfolios.


Beyond low fees and professional investment selection, we strive to deliver positive outcomes by automatically rebalancing portfolios to maintain a customer’s investment allocations and applying a programmatic tax-loss harvesting service to reduce capital gains.


I am also really excited about our ESG portfolios, which have been very popular with Betterment customers, allowing them to invest in a manner that aligns with their values such as economic empowerment, social justice, and environmental sustainability.


Q: Tell us about an initiative you’re particularly proud of that you’re leading within your company.


There is so much that makes me proud at Betterment, but I’d say it’s actually two things that are particularly exciting for me: expanding investor choice and building a world-class financial wellness offering for small and medium-sized businesses. These were ideas that were germinating at Betterment before I arrived, but we have really elevated the game with both.


In investing choice, Betterment now offers a wide range of investing pathways, giving our customers a selection of carefully vetted and curated portfolios or allowing them to construct their own portfolios with guidance along the way. We also provide managed portfolios of crypto assets so customers can get expert-built exposure to one of the most dynamic and important financial innovations in generations.


In financial wellness, we see a once-in-a-generation opportunity for technology and regulation to enable employers to support their employees on a long-term path to financial security. We are expanding an already strong small business 401(k) offering into a full suite of products that include student loan management and 529s. This is an incredibly underserved market where employers who want to offer these benefits have found existing solutions expensive and complicated.


Q: What is the biggest misconception about the financial technology industry?


I think one of the biggest misperceptions of the industry is that it is all tech and no humans. This couldn’t be further from the truth.


Data published at the end of 2021 by CFTE, an industry education organization, reported more than 300,000 people work in this industry, 160,000 of which are in the United States, and that number has been growing by 10s of thousands each quarter as new employees join companies eager to grow and build their talent pool. Statista reported in November of 2021 that there were nearly 11,000 fintech startups in the Americas alone. At Betterment, we employ over 400 people living in 32 states.


I think a lot of commentators like to portray this as a sector run by a handful of people sitting in Silicon Valley, when in fact it is a major industry unto itself with national economic impact and reach.


Q: What’s an industry trend you see emerging in fintech over the next few years?


Personalization is a huge trend and one that I think fintech is uniquely poised to deliver. As consumers increasingly take greater control of their personal information and financial data, they can use it on fintech platforms to create an experience that accurately and richly reflects who they are and what they seek to achieve in spending, borrowing, and investing. In investing, this means gaining access to a wide range of markets and securities customized in a way that is easy to access and understand.