Jordan Gonen and Jacob Schein had both worked in the tech industry for a few years when they realized they lacked a clear understanding of their own finances. Like many other tech employees, the two software engineers held equity in startups they had worked for, cryptocurrency investments, and other illiquid assets. They wanted to track their assets and get help with investing and paying taxes, but they felt that traditional financial institutions and roboadvisors didn’t provide simple or holistic solutions tailored to people with these assets.
That’s why they started Compound nearly three years ago. Compound, part of the 2019 Y Combinator class, calls itself an all-in-one wealth management platform that shows users a full financial picture of their liquid and illiquid assets, including cash, securities, crypto, real estate, and venture investments.
I sat down for an interview with Compound CEO (and coincidentally, a former classmate of mine) Gonen, to hear about what he’s building. Before launching Compound, he and Schein personally conducted over 1,300 consultations with tech employees, founders, and investors to assess their financial planning needs, he told me.
“The way we started the company was by trying to solve our own problems. We wrote an essay about equity compensation that garnered a lot of attention in the technology community, and just started helping people [who reached out to us],” Gonen said.
Gonen and Schein helped advise these individuals on a range of topics, from whether to exercise their stock options, to how to set up an estate plan, to diversification after an IPO.
The conversations they had with folks in the tech industry paid off, helping them attract executives from a bevy of tech companies – Coinbase, Goldman Sachs, and Plaid, to name a few – to participate in their Series B round, which the company announced today.
Compound raised $37 million in the round, which was led by Greenoaks and former Stripe product manager Lachy Groom with participation from YCombinator, XYZ, SciFi, Day One Ventures, Silver Lake’s Egon Durban, FTX CEO Sam Bankman-Fried, and the aforementioned angel investors.
The company has “hundreds” of users, according to Gonen. It doesn’t explicitly target users within any specific net worth range, and works with a variety of clients in different stages of their careers, he added.
Compound sees itself as a one-stop shop for its users to view their personal balance sheet, Gonen said. It uses integrations to link to different investment platforms for stocks, crypto, and other illiquid assets, though Gonen declined to share how many platforms are partnered with Compound in this manner.
The company also uses off-the-shelf integrations for exchanges that may not already be partner platforms, and tracks users’ assets manually if they are held in particularly complex structures, Gonen said. For its tax filing service, Compound partners with platforms and provides the service in-house through a tax firm the company owns.
Gonen hopes to grow the team, approximately 50 employees today, “quite materially” with the new funds.
“People should globally optimize their finances rather than locally optimize them for particular situations,” Gonen said.
“That being said, a lot of clients come to us around catalyst events,” he added. “They’re deciding whether or not to exercise their stock options, thinking about if they should get a loan to exercise their options … Should they move states? How do they diversify after a liquidity event? How much can they afford to angel invest? What Compound does is provide an all-in-one platform to answer those questions.”