Alto, a technology platform aiming to facilitate the addition of alternative investments into IRAs, extended its seed round of funding, adding another $2.6 million, the firm announced. The latest funds bring the total funding raised by the firm to $6.4 million and marks the end of its seed funding, according to the firm.
The most recent seed funding was led by the family office of Hamilton “Tony” James, a board member and an executive vice chairman of Blackstone, and VC firm Moment Ventures.
The investment made by James’ family office, called Jefferson River Capital, is an extension of his personal research and advocacy, said David Wittels, president at the firm. Last year, James co-authored Rescuing Retirement, a book outlining what he sees as a looming retirement crisis in America and a possible solution for the problem. He wrote the book with Teresa Ghilarducci, the director of The New School’s economic policy think tank, called the Schwartz Center for Economic Policy Analysis.
“Tony has been focused on the retirement system in the U.S. and concerned that more Americans than ever are approaching retirement with inadequate savings,” Wittels said. “The existing 401(k) and IRA system requires Administrators to offer predominantly short-term, liquid investments, a structural bias that leads to subpar returns in comparison to pension funds and endowments invested in longer-term, less liquid alternatives.”
“Tony and I have been impressed with Alto’s mission to empower individuals to rethink the way they invest for retirement and the progress they’ve made to date,” he added.
Alto, with its 12 employees, is still very much in its infancy. The millions of dollars of additional funding will be used to expand headcount at the firm, concentrating on product design, development and marketing, according to a company spokesperson.