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If you have ever tried to rollover a 401(k) from a previous job you know what a painful process that can be. Another big problem with 401(k)s is that many people will move jobs and ultimately forget about their old 401(k). Both of these problems are hurting people trying to maximize their wealth in retirement. Enter Capitalize.
My next guest on the Fintech One-on-One podcast is Gaurav Sharma, the CEO and Co-Founder of Capitalize. His company solves both problems: they make it much easier to do a rollover and they help find any old 401(k)s that have been forgotten about. And in doing so, they are helping Americans have a more prosperous retirement.
In this podcast you will learn:
- How Gaurav came to be in this country.
- Why he became fascinated by the retirement market.
- The total number and amount of forgotten 401k accounts.
- How Capitalize helps individuals transfer retirement accounts.
- The regulatory hurdles that Capitalize has to deal with.
- How and why they pivoted from direct-to-consumer to B2B.
- What the consumer experience looks like at Capitalize’s partners.
- How they manage the different points of friction in this rollover process.
- How working with the legacy asset managers is different than the fintechs.
- The typical amount of money they move in a rollover.
- How they are going to be working with RIAs.
- How Capitalize makes money.
- The scale they are at today.
- How Gaurav thinks about the retirement landscape and the role Capitalize can play.
Read a transcription of our conversation below.
FINTECH ONE-ON-ONE PODCAST NO. 524 – GAURAV SHARMA
Gaurav Sharma: There are about 30 million of what we call forgotten or left behind 401ks in the US. And in total, they have about $1.65 trillion of assets in them. Now that number is about 12 to 15 months old. We haven’t updated the research, but it’s pretty close. And so that is close to 25% of all the money that’s inside 401k plans. The second problem is though, and Capitalize solves both of these actually. I’ll kind of talk a little about that. The second problem is even when you know where your money is, right? So I worked at IBM or I worked at Google and I had my money there and now I’m at a different employer or I want to move my money somewhere else. Even when you know where the money is, it’s incredibly difficult to transfer it.
Peter Renton: This is the Fintech One-on-One Podcast, the show for fintech enthusiasts looking to better understand the leaders shaping fintech and banking today. My name is Peter Renton and since 2013, I’ve been conducting in-depth interviews with fintech founders and banking executives. On the show today, I am delighted to welcome Gaurav Sharma. He is the CEO and Co-Founder of Capitalize.
Now, many of us have old 401ks lying around from a previous job that we’ve either forgotten about or decided it was just too much effort to move it. Capitalize solves this problem. They make two things very easy. One, finding your old 401k and two, moving that money over to a new IRA. How they do that is the topic for today’s discussion. Now let’s get on with the show.
Welcome to the podcast, Gaurav.
GS: Pete, great to be here. Thanks for having me.
PR: My pleasure. So let’s kick it off. It’s good to interview someone who sounds like me, a fellow Aussie. So tell us a little bit about your journey here, because when we first chatted, it was actually before you started this company. We had a coffee in New York many, many years ago now. And you were talking about starting something, but you were still, you were at a hedge fund, right? So tell us a little bit about how you came to be in America and how you came to start Capitalize.
GS: Well look, I appreciate you taking the time to interview a fellow countryman on a fintech journey like yourself. I’m obviously excited to be here with you. Look, as you know, and as folks can probably tell pretty quickly from my weird accent, which we share, I grew up outside the US. I grew up in Australia and went to school and university there, although I ended up studying abroad in the US for a year and really enjoyed it, which was part of my motivation in coming back. So at school, at university, I studied finance and law and was really interested in traditional finance at the time. So I started my career in New York at UBS in their investment bank. And my timing was impeccable. I started in the summer of 2008, and little did I know that I was sleep walking into the biggest financial crisis of the century. And so that made for a very exciting and interesting time. At the time I was advising banks and fintech companies on things like M & A and capital raises and insurance companies. And it very quickly went from here are all the exciting things you should do to grow your business to here’s what you need to do in order to survive. So it was definitely trial by fire,and did that for about a year and a half. And then transitioned into the investing world. So I was really interested in investing and in particular investing in the public markets or the equity markets. So I worked my way into the hedge fund industry. And so I started my hedge fund career at JP Morgan inside of a hedge fund that they had built, actually moved to London for short period of time and then was recruited to help invest on behalf of a large independent hedge fund called Greenlight Capital that had been started by this fellow David Einhorn in the mid-90s. David had turned it into one of the most recognized investment firms in that arena, and I had the pleasure and the fortune of working directly for him and learning how to invest from one of the masters in the business. I really enjoyed, I spent the first 10 years of my career in traditional finance, which is probably towards the tail end when you and I met. But a couple of things happened to me. I think one was I got bitten a little bit by the entrepreneurial bug, right? And so this was probably 2017 to 18. And I’d grown up with a dad who was an entrepreneur. So I think somewhere in me, it was always there. But I just felt the itch to go and build and grow something and see, could I start a company that had a really positive impact on people’s lives? And so I got bitten by that bug, and the second bug I got bitten by, which is a weird one really, is I got deeply fascinated by the retirement savings market. And that led me, you know that sort of odyssey led me down to start what is now become Capitalize.
PR: So what was it, what did you see that was the problem with the retirement market that you thought you could create a company to solve?
GS: Yeah, look, there are many problems in the retirement system. So frankly, you’d need a hundred lifetimes. There are some good things too, don’t get me wrong, but obviously there’s just a lot of friction. The vantage point I started with, actually, I remember what triggered it for me was looking at stats that showed just how little the average American has saved for retirement when they’re age 55 to 60. So in theory, they’re five to 10 years away from retiring and you actually look at the data and you say, okay, well how much money on average do folks have put away? And what you end up concluding is that there’s just nowhere near enough money, even with social security a lot of times, to live a really high dignity life in retirement, right? And so that always struck me as a bit odd. From there, I ended up spending a bunch of time actually interviewing folks, user research. So I spoke to a lot of friends and peers of mine and tried to understand, well, “What are the problems that you have when saving for retirement?” And a lot of them came back to, “I had a 401k through my employer and I didn’t really know what to do with it or I left it behind and I forgot to move it or I forgot to transfer it or I did transfer it and it ended up being a really painful process.” And so that got me really interested in the 401k world and in particular, what structural frictions do we have by tying retirement assets to employers, which is the model that we have in the United States. So it’s much like healthcare, where the individual goes to an employer and they expect the employer to help them manage retirement. And so one of the things that we observed is that people would go to these employers, they’d save inside of a 401k, and then they’d completely forget about it, right, and then move on. And this became a really interesting thread for us to pull on, to understand why people are doing this and what exactly is going on.
PR: So how big of a problem, what are we talking about as far as numbers where people leave their 401k behind? I mean, obviously a lot of people have lots of different jobs throughout their lifetime, but have you quantified how big this problem is?
GS: Yeah, absolutely. Look, I think there’s two dimensions to the problem. One is, people forget about their assets. And then two, when they kind of have their assets, it’s how do they move that money? How do they transfer that money? And so on the first one, there are about 30 million of what we call forgotten or left behind 401ks in the US. And in total, they have about $1.65 trillion of assets in them. Now that number is about 12 to 15 months old, we haven’t updated the research, but it’s pretty close. And so that is close to 25% of all the money that’s inside 401k plans.
PR: Wow.
GS: The second problem is though, and Capitalize solves both of these actually, I’ll kind of talk a little bit about that. The second problem is even when you know where your money is, right? So I worked at IBM or I worked at Google and I had my money there and now I’m at a different employer or I want to move my money somewhere else. Even when you know where the money is, it’s incredibly difficult to transfer it, right? And that process is called the rollover process in the US. It’s the technical term for moving your money from one place to another. There is almost a trillion dollars that gets rolled over each year from old 401ks into new accounts, right? And that can be a new employer 401k, or it can be what’s known as an individual retirement account. That trillion dollar flow of funds is incredibly old school and manual, right? So it usually involves a phone call, paper checks, faxes, you know, checks in the mail, sometimes even notarization, and sometimes, believe it or not, spousal consent to even move your money. And so that problem is a really large one that we’re solving, which is how do we help people find their 401k’s in their assets? And more importantly, how can we make it seamless to move your retirement accounts?
as you go from job to job to job throughout your career.
PR: Yeah, you know, it’s interesting because I recently just did this when we sold the events business and had a 401k there and it’s a big provider, a name that everybody would know. I’m moving it to another company that everybody would know. And it was amazing to me. Like I could have wired the money and paid, but the default was a check, and it was actually two checks because you have your employer contribution and the employee contribution. I actually ended up getting two checks in the mail, which then I had to go and mail on to the new. And I thought, my God, this is, this was 2024. And here we are still dealing with paper and overnight freight. It’s just like, this is, it’s crazy. How does Capitalize help there?
GS: Capitalize is a technology provider and we effectively solve that problem. So we make it easier for individuals and their financial institutions to transfer retirement accounts. And the thesis of the company is that if you can’t move your money, you can’t manage your money. So, retirement assets are one place where it remains, as you point out in 2024, really difficult to do that. And so what we’ve done is we’ve built technology that does three or four key things. The first thing that we do is we can digitally locate accounts that have been left behind. So if you are in the bucket of consumers or savers and you don’t know where all your assets are, we’ve built really interesting proprietary technology that helps you locate those assets. And that’s been a labor of love over many years, but that’s kind of number one. Number two, we’ve gone and mapped all of the transfer processes for the largest, what you call record keepers or 401k providers in the US. And we’ve digitized those to the fullest extent possible. And then the third thing that we do is we make all of this available to our partners via API. So they can offer all of this wonderful streamlined technology to help their users find and consolidate assets in a much more digital experience. And the goal there is, listen, if you’ve ever banked before, you’ve done an ACH or a wire, it’s not a bad process. If you’ve ever transferred brokerage assets, you’ve probably used something called ACATS. Also not a bad process. How can we make this process look more like that?
PR: Right.
GS: Where it’s much more digital, much more seamless for people to find transfer assets. And so that’s what we’ve gone and done.
PR: Right. So, but a lot of this, there are some pretty heavy regulatory type barriers for some of this stuff, right? Because I mean, there are, this is all codified into law where you’ve got fiduciary duties and there’s all sorts of different barriers, I would imagine that you’ve had to overcome. So can you make it so it’s a really digitally native experience even with those challenges?
GS: Yeah, it’s a good observation. So the Department of Labor cares a lot about what happens to people’s retirement savings account, right? And that’s as it should be. What they focus more on is making sure that people don’t get really bad advice around their retirement accounts. You know, the problem that they’re really focused on from a regulatory standpoint is, how do we make sure that people do the right thing in their 401k. They don’t get told by an unscrupulous advisor, hey, why don’t you put all this money into this high fee alternative fund or this really high fee annuity and I’m going to manage that for you. Regulatory wise, the thing that we’ve had to be really conscious of is not getting close to the line of advice. And for us, that is relatively straightforward because we’re just helping facilitate the money movement. Right? We’re helping you move your money from A to B, and we’re often again embedded directly in other financial institutions’ funding flows. And so that’s the one we’ve had to steer really clear of and be mindful of. The bigger barrier actually is probably not regulatory, which is just a thing that we have to aware of. The bigger barrier is how do you get the cooperation of incumbents and folks who are used to the status quo. This model has persisted for a long time. And so that has been something that we’ve worked on, we obviously continue to work on.
PR: Yeah, because, I can imagine their technology was probably built in the eighties, where the only way you could do this was by a check or possibly wire. But, okay, you started out, I believe in our conversations we’ve had over the years, with a direct to consumer type focus, but you have pivoted more to a B2B. Tell us a little bit about how you’ve evolved the business.
GS: Yep, yep, you’re exactly right. So when we started life, we started life as a direct-to-consumer company and we would basically acquire users and we’d say, hey, we’re going to help you. Number one, we’re going to find your old accounts. And then number two, we’ve curated a list of really good IRA providers, like the SoFis, the Betterments, the E-Trades, Schwabs, Robinhoods of the world, and they’re our partners, right? And so once we find your money, we’re going to sort of enable you to open up a new IRA at one of these institutions. And then we’re going to leverage our technology to bring your money over. So, you know, if you were at an ADP or a Principal, whatever it is, we’re going to use our technology and our pipes to move it to, you know, that new account to SoFi, Betterment or Robinhood or whoever it is. And the revenue model was free to the consumer because
these partners and these IRA providers would pay us a referral fee or a rollover fee, right? Cause they were very excited to have you as a customer. So it’s somewhat analogous to say like a policy, like a life insurance marketplace or any marketplace real experience where it’s often free to the user because there’s a referral fee that enables that. And that’s how we started life. What we realized, you know, a year or two in, was that there was a really large opportunity to take the technology that we’d built and make it available to financial institutions who wanted to embed it directly, right? And so the value prop remains the same in that we’re still helping individuals move money to our partner institutions, but the way that we do that is different. So for example, if you go to Robinhood or SoFi today and you open up an IRA, they’ll say, okay, we leverage Capitalize. They’re going to bring over your assets into this IRA. And that’s a native embedded experience. And so that part of our business, which we call our Enterprise or B2B offering has grown really massively over the past 24 to 36 months. And it’s where we spend, you know, frankly, a little bit more of our time today.
PR: Are you still keeping the direct-to-consumer, is that still an offering today?
GS: Yeah. Completely. And that’s grown really nicely too. It continues to help users. It continues to be a nice growing business for us. We’ve just seen frankly more growth on the Enterprise side over the past two years.
PR: So, okay, let’s just say I go to SoFi and I open up a retirement account and they say, “We use Capitalize.” Can you explain that flow of how SoFi is going to locate my old account, my old 401k through Capitalize and bring it in? What’s that look like?
GS: Without referring to any specific partner implementation, the gist of it is it’s like a Plaid experience, right, within the onboarding of our partner. So, you’ve gone and opened up an individual retirement account or an IRA at one of our partners. And the next step will be, okay, well, how do you want to fund it? And most of the time, the way people fund these IRAs is through a 401k rollover, right? It’s through bringing over your legacy 401k assets. And so as soon as they say, that’s what I want to do, they see a powered by Capitalized experience that is native to the partner, right? And the first thing that we’ll do is we’ll collect one or two bits of information that will allow us to go in digitally and most of the time instantly find where their money is. You know, your money’s in Voya or Fidelity, wherever it is. So we’ll locate the account using our flow. The second thing that we’ll do then is we’ll submit the rollover on behalf of the user. So again, we’ll collect a couple bits of information and then we leverage our backend technology to go and say, okay, hey, Peter Renton has opened his account at whatever the partner is. His legacy funds are at wherever they are. Capitalize is going to submit the rollover request and make sure the money gets moved from A to B with minimal hassle for Peter and maximal assets for the new partner. And so that’s how it works.
PR: Okay, so I want to just pause a little bit and talk about that less hassle for Peter, right? Because that’s what I’ve found when I’ve been doing this myself over the years is that there is hassle and I’ve moved money and I’ve rolled over money into some of these very esoteric fintech investments that end up being more challenging to work with. But even without that, it’s all like a two-step process. One is making sure they’ve sent the money. And then making sure the other company has received the money. And those are the, there are two points of friction there. So how do you manage that?
GS: Yeah. So the first one, which is the first one we think about, and there’s three really, like just finding the money, right? Which we’ve talked about, we’ve done that digitally, and so that’s instant. The second is how do you submit the rollover transaction? And then the third, to your point, is how you make sure the money moves. Number one, on finding, we built proprietary data and technology so we can take your PII, we can go and scour the web and we can say, Hey, your money is here. We know Pete, that it’s at Fidelity and you can confirm it for us, but we’re pretty sure, or Voya or ADP, wherever it is. The second thing is, okay, once we know where the money is, we know exactly how to submit that rollover request. And that goes back to the thing that we did early on, which is we went and mapped how each of these 401k providers requires you to submit the rollover request. And the problem is there’s no uniformity.
PR: No.
GS: There’s no protocols. There’s no federal government, you know, going back to regulatory, the DOL has never said, okay, every 401k provider has to accept this form, or they have to do it digitally or whatever. And so the mapping and the identification of what each of these providers needs allows us to then submit the rollover, you know, largely, oftentimes on your behalf, with you not having to do anything. Some of that is entirely digital because we’ve gone and digitized those flows. Some of the time we actually have our operations folks. So we have an operations team that, you know, to the extent your transaction requires any agent intervention, we’ve gone and built out that functionality as well. And so we step into the shoes of the user, primarily using technology, occasionally using agents, if required, to make sure that the money then, the request then just gets submitted.
PR: Right. Okay. So I get working with the Betterments, SoFis, and Robinhoods of the world. They’re fintechs, and they’re very technology-enabled. They’ve got tech teams that are open to bringing in new technology to help them. But what about the old guard, those, the multi-trillion dollar asset managers? There’s many, there’s several of them now, that have been around sometimes for decades or even a century or more. How are you working with them? I imagine they’re not as easy to work with as these other guys, right?
GS: You you’ve been around enterprise fintech for long enough. I think you know the dynamics pretty well. And you’re exactly right. The adoption curve or speed for the newer, more digitally native companies is really quick, right? And so they get it. They’re used to working with APIs and certainly on that part of our business, it’s been super quick and easy. Nothing’s ever easy, but certainly like those have moved and those have moved nicely. You know, we are working with some of the bigger players and we’ll actually launch publicly with a couple of them towards the end of Q1. And so I’m excited to kind of chat more about them. Those work too. It’s just, you know, the sales cycle is obviously longer, right? The time it takes to build awareness, understanding of the problem, you know, get to the right folks internally, it’s just longer, right? And so there are ways that you can shorten it, but you just have to go in knowing that this is going to be a longer putt than some of the kind of faster moving digital players. And look, the reason is partly that they have more to lose, right? To your point, they’re multi-trillion dollar companies, they’re big, they’re often first in the crosshairs of regulators, they’re publicly listed. And so, you know, like there’s a little bit of risk aversion where they just want to see you and they want to see the traction and they want to see you continue to grow and mature as a company. And so I think the good thing for us is, you know, once you’ve been around for five years, you’ve now called on these people, right, once a quarter for five years, right? And that’s one of the things that we tried to do. We tried to do from early on, let’s go meet with everyone and let’s try to do it, you know, at least a few times a year. And even if they’re not going to partner with us or buy our product day one, we get to keep showing them, okay, here’s what we’re doing. Here’s how we’re growing. Here’s our volume. Here’s the social proof. Here are the awards, the recognition, and the other folks that we’re working with. And gradually, bit by bit, I think you convince them, and it now sort of switches, right? It becomes, you know, is it career risk for the decision maker to use me or is it career risk for them not to use me because I’m now powering transactions and I’m moving assets to a lot of share gainers in the industry, right? And so I think the good thing for us is we’ve been able to find champions at some of those larger institutions. And I feel like, you know, again, knock on wood, you never say never, but it feels like for our business, we hit a little bit of an inflection point where, you know, now folks are seeing the downside of not working with us because they’re seeing others in the industry take advantage of the technology and it’s a zero sum game, right? You know, there’s a certain amount of assets that move each year from 401ks to new accounts and it’s a really attractive pool of assets. And so you need to grab it. And so I think, you know, it’s a mix of just being methodical, being consistent, understanding it’s going to take longer, but you know, sticking with it and it’s a long sales cycle for sure.
PR: Right. Well, it’s like with Plaid, you know, originally, you know, it was a really weird thing to do where you connect your bank account through Plaid. But now, I mean, the average consumer has seen that Plaid logo and they’re used to it now. I think the thing is about, you know, retirement accounts, we don’t open a retirement account every month or every year, or, you know, even every several years. But when we do, there are big numbers at stake. And so you want to, you want to do it, in fact, that reminds me what is sort of the typical amount of money that you move in a single transaction.
GS: You know, it’s anywhere between $30,000 and $60,000. Right. So these are, these are fairly healthy, you know, transfers. The average 401k balance in the US is over a hundred thousand dollars now. Right. And that’s, that’s skewed a little bit by people who have been, you know, working at Google for 20 years or, they’ve got, you know, a $2 million 401k. So the average is skewed, but even the median at this point is about $50,000. And so these are the balances that are getting transferred here.
PR: Right, yeah, that’s good. And I just read just the other day that we’ve hit over 50% of workers now in a 401k. So that is good to see. So then what about RIAs, Registered Investment Advisors? Because a lot of people who have some wealth work with an RIA and they often don’t make any moves without their RIA’s approval. How are you getting to those people?
GS: So we are very excited about the RIA space and we’ll have more to say on this, you know, in a, you know, it’s a sort of stay tuned, watch the space teaser, if you will. But look, you’re exactly right. We think there’s something like 2 million, you know, let’s call it 8 to 9 million rollovers that happen each year. We think something like 2 million of those rollovers are intermediated or touched by an RIA. It’s a big number. The RIA and the RIA client have many of the same frustrations that we talked about, which is, where is my money and why is it so hard to move it? And what happens today is the advisor or the advisor’s associate will brute force their way through a manual experience, try to track it down and move it, right? They’ll do what they can, but it’s rarely a good experience for anyone involved. And so we are very actively exploring how we can solve that problem for RIAs as a way to kind of grow our platform volume and reach more users.
PR: Yeah, I didn’t even think of that because I do work with an IRA that manages, you know, some of our assets and it’s a manual process and they do all the work, thankfully, when doing a new investment but God you could make them so much more efficient because something that might take an hour can suddenly take five minutes. That’s a big, big help for those sorts of people.
GS: I will say, the estimates we have received from advisors are that the average transaction takes multiple hours.
PR: Right.
GS: And so if you think about the time and cost unlock here, I mean, that’s really valuable. These are high compensated folks, right? And so their time is better spent helping you grow your assets, advising you, rather than struggling with this really manual, cumbersome experience.
PR: So then what’s your business model? Are you a SaaS company charging a monthly fee? Do you get paid? I imagine you’re not getting an AUM, or are you? don’t know. How do you get revenue?
GS: Yeah. So we charge primarily per transaction. If we complete a rollover for our… this is on our Enterprise side, our B2B side. For every transaction that gets completed, we get paid a fee by our Enterprise customer, our partner. We don’t currently charge an AUM fee, right? We don’t tie that fee directly to the assets that we rollover. However, when we think about the value that we create, and therefore the price that we want to charge, there’s a connection, right? Because I can go down and sit with my partner and say, “Hey, look, you know, I’m going to drive, I’m going to help you get a $50,000 rollover that you would otherwise maybe not get. And you know, that money is going to be with you for 10 years, right? And it’s going to grow at 8% or 6% because it’s invested in the market. You, provider A are going to charge 50 to 100 basis points.” And so we have fairly clear conversations with our partner about the LTV of one of these transfers. And it’s in the thousands of dollars. Now, sadly, I don’t get to charge thousands of dollars, right? At least not yet. But we don’t charge an AUM fee, but we do make sure that everyone understands the AUM benefit and value that we create. And so that’s how we think about it.
PR: Right, right. Can you give us a sense of like the scale you guys are at? Like how many people are working there? Anything on transactions?
GS: You know, we’ve said we’re processing billions of dollars on an annualized basis in transfers. We’re looking to exit this year at close to $10 billion. That’s the target. It’s ambitious. But we would, you know, that’s the kind of goal that we’re chasing. And we’ve grown that volume pretty substantially. We started with obviously nothing at the end of 2020. You know, we’re doing billions in volume right now. We have about 45 folks working with us here in the US, across our different teams. And so we’ve been really gratified and humbled by the growth and the partnership of some of big partners.
PR: Right. So when you look at the retirement industry and the whole kind of landscape of what is ahead, because you know, we’ve got Baby Boomers that are retiring every day and then the Gen Xs are not going to be far behind them. People lose like a one point, whatever it was, $6 trillion that you said that just kind of people aren’t really paying attention to. I mean, that, that could make a huge difference. How do you look at the retirement landscape and the role that Capitalize can play here?
GS: There’s a few things. I’ll talk about it, how I think about it, at a systems level, and then, I think, certainly the role that we can play, right? Look, I think as a society, we all want people to have a good life in retirement, right? Like the sort of a social contract, I think, where you work really hard, you pay taxes, you try to put away. And the hope is that you get to the end of that and you can live a really good life. And so that sense of mission is actually, you know, it’s certainly what led me. It was a big motivator for me. Right? And how do we actually help people do that? How do we do that? Well, number one, we’ve got to help them save more money. And so things like the expansion of 401ks is a great thing. Like there are great companies out there who are pushing 401ks and that’s helping. Once that money is saved, we need to make sure people do the right thing with it. that they don’t forget about it, that they manage it and they optimize it and they make sure they keep an eye on it. And so that’s obviously the role that we play, right? We think about it as, you know, again, if you can’t move your money, you can’t manage your money. And so if you’re, you know, the data that we have is you could be missing out on hundreds of thousands of dollars in foregone savings if ,over the course of your career, you just forget about this money because you don’t know what it’s invested in and it could just be sitting there in cash or a collection of investments that isn’t right for you. And you could be paying fees that are too high, right? Because you got stuck in a high fee account and you didn’t really know it. And so the other way we think about it is, is number one, let’s help people find and move that money to the right place for them. And then over time, you know, how can we help people manage that money better? And right now it’s kind of too early for us to play in that field, we’re very focused on how to help people move money. And what we want to get to ultimately is every time you open up a 401k or an IRA, there’s a button that says Transfer, and Using Capitalize. You know, one of the things we haven’t talked about is how can we help people move money from 401ks to other 401ks. Right now we’re focused on 401k’s to IRAs, but actually there’s a couple million people here who want to move their money to another 401k. So, there’s also HSAs, which are really hard to transfer. Even IRAs are hard to transfer. So in aggregate, there’s $2 trillion of assets that move each year, retirement assets that move each year. How can we make all of that much easier and more seamless so that people can get on with it and focus on the things that are really going to create value?
PR: Right. Well, we have to leave it there, Gaurav. That’s a good place to leave it though, because I think it’s such important work that, you know, retirement, everyone wants to have a good retirement. You want to live a healthy and wealthy retirement if you possibly can. I appreciate you making it easier for individuals to do that. So thanks, thanks so much for coming on the show Gaurav. Always great to chat with you.
GS: Great, thanks for having me.
PR: I think Capitalize is a great example of a fintech company tackling a difficult problem that was being ignored and bringing the latest technology to bear to take cost and time out of the equation. And the thing that may end up being their most useful contribution is for the millions of people that have an old 401k gathering dust somewhere. Now, once they know it can be an easy task to move that money, they will actually take the initiative to move it. That could have a profound impact on the retirement wealth of this country. Anyway, that’s it for today’s show. If you enjoy these episodes, please go ahead and subscribe, tell a friend or leave a review. And thanks so much for listening.