According to Forbes, people in the millennial and Gen Z generations currently represent the largest demographics in the United States. With this demographic transformation, many believe that the financial planning and advising industry needs to drastically change to best serve these customers. The millennial and Gen Z generations have different attitudes towards money compared to earlier generations due to factors like high levels of student debt and a shift in employment due to the pandemic. These groups are also much more likely to use digital banking and robo investors as compared to traditional financial advisors and planners.This is the key problem that Detroit-based fintech startup PocketNest is aiming to address.
Pocketnest “uses behavioral science and psychology to coach your community to achieve financial wellness in 3 minutes a week”. The B2B SaaS platform’s mission is to demystify financial planning and equip users with the tools they need to manage their own financial plan. Pocketnest was founded by Jessica Willis, who after spending two decades in wealth management noticed that traditional financial planning was ignoring a key demographic: millennials and Gen X consumers. “Millennials alone are anticipated to inherit $68 trillion from baby boomers by 2030, but 67 percent of them turn to Facebook and Twitter for financial advice. I knew there was not only an entire generation that lacked access to financial wellness, but a massive tidal wave of opportunity coming to financial institutions,” Willis told Endeavor Detroit.
Pocketnest licenses its software to financial institutions and employers, which provides them with data and knowledge about their customers and employees, while serving Pocketnest users with a pathway to their financial goals. Since 2020, Pocketnest has experienced incredible growth, with a 156% increase in enterprise customers, 115% increase in overall users, and a 15% monthly growth rate. The company was also named the Top Startup to Watch in 2022 by Purpose Jobs for the second consecutive year. After a recent round of funding by Reseda Group, Pocketnest has acquired nearly $1.95 million in funding, unsurprising given that Michigan now has the largest venture capital growth of any state since 2016. Funding in the state has grown 886% since 2016, from about $300 million to over $3.1 billion.