Captain401, now Human Interest, raises $11M to build a 401(k) for small businesses

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Pushing through a funding round is never an easy process — and for Captain401 co-founder Roger Lee, it was even more tricky this time around.

That’s because Lee and his team raised $11 million right around the birth of his first baby. That gave Lee an even deeper appreciation and understanding for the need of robust employee benefits, which was part of the original goal of Captain401 — giving small businesses access to a 401(k). That goal is also the reason that, with the new fundraising, Captain401 is changing its name to Human Interest. The startup’s latest funding round was led by Wing VC, a firm founded by partners from Sequoia and Accel, as well as former Wealthfront CEO Adam Nash.

“We really wanted a name that captured the vision behind our company and what we really hoped to accomplish in the place we saw in the world,” Lee said. “We saw a need from people across the country to have an advocate that really had their best interests at heart. You look across the landscape of traditional financial institutions today, but you look at big banks and wall street, customers have started to lose trust in the traditional institutions. We’re very mission driven because we’re trying to help people achieve a secure financial future — and employee benefits, for both mission values and the business we’re in we think it’s really important to treat our employees well and provide them strong benefits because we’re an employee benefits company.”

Human Interest — as its former name Captain401 implied — focuses on creating an easy system for small businesses to begin offering a 401(k) to employees. It’s geared toward companies trying to get it up-and-running for the first time, as when companies start to mature benefits like that quickly become table stakes, lest they lose those employees to competitors with more robust benefits. It’s also important to get those plans in place early, as employees likely want to begin securing their finances early on.

The focus is on both ends of the employee spectrum, looking to give employers a way to quickly deploy it and also make the experience a little less painful for employees. Even if you’re at a big company that offers a 401(k), it might be buried behind a number of different websites and logins. Human Interest looks to make it easy to check an employee’s balance, as well as help them figure out the best plans and investments given whatever situation they are in. Ease of use is the big target, Lee said.

“The vast majority of our customers are getting a 401(k) for the first time,” Lee said. “Our very first few customers were tech startups in the bay area, and that made a lot of sense for us to start. But we always believed the problem we were tackling was much bigger than bay area startups. In general I think the positive surprise has been seeing interest beyond tech earlier than expected. That was always our hope and belief but it was encouraging when it did start happening, it happened sooner than we expected.”

While Human Interest is solely focused on the 401(k), which is popping up in some unexpected areas like hospitality, there seem to be plenty of opportunities to expand to new products as they start to lock in small businesses as customers. Lee said the startup’s goal is to help them secure a financial future, which the 401(k) is a big part of — but there are obviously other ways to do that as well.

Human Interest will, of course, have some competitors as it continues to expand — especially if it wants to grow beyond the 401(k). There are startups like Money Intel, and while a vast array of small businesses might not be especially low-hanging fruit for major financial institutions, there seems to be plenty of opportunity for a product to hit that sweet spot. But with some experience getting it up and running across the country, as well as a focus on ease of use, Lee hopes they’ll be able to outmaneuver those potential challenges.





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