Protecting Family & Their Finances: Why We Invested in Carefull

We’ve known the Carefull founders for some time, but Dan Rosen and Todd Rovak (Co-Founder & Co-CEO of Carefull) have known each other for almost 20 years, dating back to studying together and working on startup projects in graduate school. Since then, Todd has spent much of his career helping the largest enterprises in the world identify, design and build innovative new projects as an early Partner of leading design consultancy Fahrenheit212, and eventually as its CEO. Under Todd’s leadership, the firm grew rapidly and was acquired very successfully by Capgemini, after which Todd was named CEO for Capgemini Invent, North America. While we don’t always have such lengthy and extensive relationships with founders when we invest, they surely help establish conviction about the team’s strengths when we do. Obviously, at the early stages, team is the most important determinant of a venture’s success.

Speaking of the importance of exceptional teams, Todd wisely partnered with co-founder/Co-CEO and proven serial entrepreneur, Max Goldman. Max’s journey included founding several prior ventures, including video startup Directr, which was acquired by Google (YouTube) in 2014. At YouTube, Max created, launched and ran the Youtube Director product portfolio for 3 years. His background also includes several product leadership roles at scaled tech startups such as SuccessFactors and Envoy.

Todd and Max’s individual and shared experiences have helped them embrace the whitespace opportunity that has existed in Carefull’s market. Together, they have created a first-of-its kind platform designed to protect seniors from exploitation and fraud-related losses, while simultaneously providing a way for the largest financial institutions and advisors in the U.S. to better engage these clients’ families and provide a pathway for generational wealth transition.

We’re so excited to work with the Carefull team (as well as Fin Capital, TTV Capital, Bessemer Venture Partners, Montage Ventures, Alloy Labs and other strategic investors) and are grateful to be a part of the company’s $16.5 million Series A round. Stay tuned for more exciting news about Carefull!

Our Market POV

1. With the U.S. population aging at a rapid rate, we have long been looking for opportunities that might help this population with their finances (or their children with financial caregiving) while addressing the eventual need for generational wealth transfer solutions.
2. ‘Family Banking’ / ‘Household CFO’ — We have actively been pursuing the household CFO theme for most of 2023. We identified this theme through extensive discussions with our financial institution partners as well as lengthy desk research about the market demographics and needs.
3. While this market mapping led us to speak with many startups across various aspects of family banking, very few had shown meaningful commercial proof points. This was a key part of what distinguishes Carefull and the opportunity to invest in the company today.

Leaders in their category

1. We believe Carefull is strongly positioned to lead the market through generational wealth transfers while solving the critical retiree fraud pain point. Few players have emerged with holistic solutions to solve this enormous need.

Distribution is everything

1. Carefull partners with existing, trusted financial institutions and helps them strengthen their client relationship by solving important challenges for their clients.
2. Leveraging trusted relationships offers the potential for a larger and lower friction path to broad adoption, relative to a challenger model by which a startup might attempt to sell this offering over-the-top or as a challenger to the client’s existing financial provider.

Highly strategic positioning

1. Major FIs struggle to retain the inheritors of wealth, with research suggesting that ~70% of heirs change financial advisors after receiving their inheritance.
2. If Carefull can continue helping large financial institutions increase trust and broaden familial client engagement, we believe they will be enormously commercially successful and a very strategic platform in the eyes of financial institutions and the infrastructure providers who serve them.