Harness Wealth Raises $15M to Democratize Family Office Access

The Growing Demand for Accessible Family Office Services

Family offices, while originating in the 19th century, have experienced a significant surge in numbers in recent years. A 2019 report from UBS and Campden Wealth revealed that 68% of the 360 family offices surveyed had been established in or after the year 2000.

This expansion is driven by several factors. The proliferation of technology startups creating new centi-millionaires and billionaires annually, coupled with the increasingly intricate financial challenges faced by high-net-worth individuals, are key contributors. These challenges encompass areas like household management, legal counsel, trust and estate planning, and investment strategies.

The Current Landscape of Family Office Services

Traditionally, family offices have primarily served individuals possessing investable assets exceeding $1 billion. Multifamily offices, which pool resources from several families, generally target those with at least $20 million available for investment. This substantial financial threshold leaves a considerable number of affluent individuals without dedicated support.

Harness Wealth, a New York-based firm founded in 2021 by David Snider and Katie Prentke English, aims to address this gap. They focus on providing services to individuals navigating complex financial situations, particularly those following significant liquidity events.

The Founders' Backgrounds and Vision

Snider’s career began with roles at Bain & Company and Bain Capital. He later became the inaugural business hire at Compass, ascending to the positions of COO and CFO following a $25 million Series A funding round in 2013. Compass has since grown substantially, currently holding a market capitalization of approximately $5.3 billion, just months after its IPO.

Snider identified an opportunity to integrate traditionally separate financial services, such as tax and estate planning with investment management. This realization stemmed from personal experience, as he noted, “Despite all these great things on my resume, every six months I found something I could or should have been doing differently with my equity.”

Prentke English brings extensive experience from American Express and, notably, as the CMO of London-based online investment manager Nutmeg. She joined forces with Snider after recognizing similar limitations within the digital investment space; Nutmeg was subsequently acquired by JPMorgan Chase.

Harness Wealth's Unique Approach

While numerous wealth management firms exist, Harness Wealth distinguishes itself by offering more than simply connecting clients with independent registered investment advisors. The company facilitates access to a network of professionals across various disciplines, mirroring the comprehensive support typically found within a traditional family office.

Revenue Model and Growth

Harness Wealth generates revenue by taking a share of the fees charged by advisors on its platform. Snider emphasizes that this structure ensures alignment with client success, stating, “We only do well if they find long-term success with the advisers on our platform.” This differs from models relying solely on lead generation fees.

The company is actively challenging the dominance of do-it-yourself financial tools like Personal Capital and Mint, and is experiencing rapid customer growth. Its client base includes employees from prominent companies such as Coinbase, UiPath, Paypal, Snowflake, Doordash, and Amazon, as well as partners from venture capital firms.

Lessons Learned from Compass and Nutmeg

Snider’s experience at Compass revealed that while individuals desire data-driven insights and improved user experiences, they also value personalized guidance from professionals who understand their specific circumstances. Prentke English’s time at Nutmeg highlighted the limitations of purely automated financial solutions.

Recent Funding and Future Plans

Harness Wealth recently secured $15 million in Series A funding, led by Jackson Square Ventures, bringing its total funding to $19 million. A portion of this capital will be allocated to developing a new in-house service, Harness Tax.

Addressing the Growing Complexity of Tax Planning

The increasing demand for tax planning assistance is driven by factors such as the surge in IPOs, the rise of SPACs, the prevalence of remote work, and the growing popularity of cryptocurrencies. The tax code is continually evolving to address these new financial landscapes.

Snider assures that Harness Wealth’s goal is to provide value where it can, and that the expansion into tax services is not intended to compete with existing advisor partners. He notes a significant number of individuals lack a comprehensive understanding of their tax obligations, particularly concerning cryptocurrency investments.

Investor Confidence and Key Backers

Harness Wealth’s investors include Bain Capital, Torch Capital, Activant, GingerBread Capital, FJ Labs, NFP Ventures, i2BF Ventures, First Minute Capital, Liquid2 Ventures, Alleycorp, Marc Benioff, Compass founder Ori Allon, and Paul Edgerley, former co-head of Bain Capital Private Equity.

Correction: A previous version of this article incorrectly stated Compass’s market capitalization as $27 billion. The correct figure is approximately $5.3 billion. We apologize for the error.