New York-based Sandbox Wealth, which is developing a turnkey private banking platform for nonbanking financial institutions, has announced the closing of a pre-seed funding round of $1.25 million. NextGen Venture Partners, a San Francisco-based firm with significant presence in Maryland, led the funding round with participation from Northwestern Mutual Future Ventures, gener8tor and Charlotte, N.C.-based RevTech Labs.
The startup said it would use the new capital to expand business operations and further R&D of its open architecture banking and lending platform that targets, among others, registered investment advisors, family offices and nonbanking financial institutions.
“This capital will not only help us build on the significant momentum we’ve established across wealth managers, insurance carriers, and other critical relationships, but we’ll also be able to bolster our operations with strategic investors at our side for the duration,” Sandbox Wealth founder and CEO Ray Denis, a banking veteran, said on LinkedIn.
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“We are seeking to empower advisors with a broad range of banking and lending products from a network of lenders that meet the unique needs of sophisticated clients,” said Denis, who has had stints at JPMorgan, Deutsche Bank and Bank of America, in a release.
Sandbox also helps banks by offering a new “channel to deploy lucrative balance sheet products with a modern customer and employee experience,” he added. “We can combine data aggregation and analytics with liquidity products clients want, enabling expedited underwriting on loans and easier money movement between institutions across our platform,” said Denis.
“We believe that Sandbox Wealth provides a compelling business model focusing on data, open architecture private banking, and AI-powered insights,” said Jon Bassett, managing partner, NextGen Venture Partners. “The company has uncovered a lucrative segment at the intersection of liquidity solutions and wealth, which will fill a banking services gap faced by RIAs and Family Offices, with a diverse selection of products from many lenders.”
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NextGen is represented in Maryland by Miller Douglas, a former Brown Advisory executive. Its portfolio firms include Virgil Security, Maven, Zuul, IP Copilot and frontrowMD.
Sandbox Capital says multiple trends playing out in the wealth management industry support its prospects. These include innovations in AI, open finance and global instant payment networks. This confluence of factors, Sandbox Wealth believes, has the potential to empower independent advisory firms with an alternate driver of organic growth.
Sandbox Wealth’s platform will also provide AI-powered natural language processing for extracting insights from financial documents, driving significant efficiencies for advisors, lenders, and clients.
