BrightScope Secures $2 Million in Series B Funding
SAN DIEGO, CA, September 2, 2009 -- BrightScope (www.brightscope.com), a 401k ratings and analytics firm, today announced that the company has raised $2 million in Series B funding, led by an angel investment from Jim Caccavo of Steelpoint Capital Partners. He is joined in the investment by a group of experienced operating executives as well as principals of several hedge funds and private equity firms. BrightScope will use the capital to build out its unparalleled database of 401k plan data and analytics, and further develop its robust suite of products and services. The company and its offerings enhance transparency of 401k plan performance and fees for plan sponsors, advisors and participants.
"The 401k plan is crucial because it has quickly become the primary retirement savings vehicle for America's workforce. Even though 401k plans have risen in prominence, most people don't entirely understand them," said Jim Caccavo, Founder and Managing General Partner of Steelpoint Capital Partners. "Industry adoption of the BrightScope Rating will ultimately lead to more cost-effective plans, increased participation rates, higher employee satisfaction, and better outcomes for millions of employees who depend on their 401k plan for retirement security."
Jim Caccavo will join BrightScope's Board of Directors. The former CEO of Tickets.com, Caccavo has been an early stage and growth equity investor for more than 10 years and spent the first 15 years of his career as an operating executive. Caccavo has been an investor in both internet technology companies and consumer facing brands and brings a deep operating and financial background to the Brightscope Board. Former Micromuse and WysDM executive Tim Tokarsky also joins the Brightscope Board of Directors in the transaction.
According to a recent study conducted by Hewitt Associates, approximately 30% of workers are not participating in 401k plans offered by their employers. Of those who do participate, 22% did not contribute enough to receive the full company match. Even worse, the AARP says more than 80% of 401k participants do not know how much they are paying in fees. This funding will help BrightScope develop new products to combat these findings by bringing efficiency and transparency to the 401k marketplace.
"We are thrilled to close this round of financing in what is clearly an extremely difficult economic environment," said Mike Alfred, CEO and co-founder of BrightScope. "The fact that we've raised this funding from such high caliber investors speaks volumes about BrightScope's commanding position in the burgeoning market for retirement plan information and analytics."
BrightScope has rated 7,000 401k plans, spanning 22 million workers and $1.5 trillion in assets, and has plans to rate more than 30,000 plans by the end of the year. The BrightScope Rating can be found at its public disclosure Web site: http://BrightScope.com, where consumers can find scores for small plans with assets of $50,000 to large plans with more than $30 billion.
About BrightScope
BrightScope is committed to helping America's workforce retire in dignity. BrightScope is an independent data analytics firm that quantitatively rates 401k plans and gives employers, employees, and brokers tools to enhance plan performance and maximize retirement outlook. The BrightScope Rating (TM) developed in partnership with leading independent 401k fiduciaries, reviews more than 200 unique data inputs per plan and calculates a single numerical score which defines 401k plan quality at the company level. BrightScope published ratings, rating definitions, criteria and methodologies are available on the agency's public site, www.brightscope.com.
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