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March 31, 2021

Asset management platform Ethic raises funds to promote sustainable investing

By Verdict Staff

US-based asset management platform Ethic has raked in $29m in Series B funding round to support the global transition towards sustainable investing.

The round was led by Oak HC/FT and also joined the company’s existing investors including Fidelity Investments, Sound Ventures, Nyca Partners, Urban Innovation Fund, ThirdStream Partners, and Kapor Capital.

The latest financing follows the company’s $13m Series A raise in 2019.

Ethic co-founder and CEO Doug Scott said: “We’re grateful to have backers who share our belief that we all have a role to play in fostering a more sustainable and equitable future, and that the capital markets can be leveraged as a force for good.”

Founded in 2015, Ethic enables advisors to personalise a given benchmark to correspond with a client’s investment, values, and tax management preferences.

The company specialises in direct indexing which continues to gain momentum in the asset and wealth management space globally as investors seek to analyse the impact of their portfolios on sustainability factors such as racial justice, climate change, worker treatment, democracy, and health and wellness.

The company, which oversees over $760m in assets, is said to be one of the largest independent providers of sustainable direct indexing strategies for wealth advisors.

Ethic will utilise the new capital to further accelerate its growth and to further expand its technology platform.

Oak HC/FT partner Dan Petrozzo said: “It’s increasingly clear that the future of asset management is personalised, and Ethic is leading the charge.

“Ethic’s unique direct indexing approach ensures the company is primed to meet a burgeoning demand from wealth advisors, as well as the broader investor community.”

In January this year, Enfusion, a provider of cloud-based investment management software, secured a $150m minority investment from ICONIQ Growth.

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