Titan Invest secures $58 million, preps crypto offering

Titan Invest, an actively managed robo-adviser based in New York City, closed its second funding round of $58 million as the rapidly growing digital platform gears up to launch its crypto offering. 

The latest cash influx follows Titan’s February announcement that it raised a $12.5 million Series A financing led by venture capital firm General Catalyst. Titan’s funding to date totals $75 million, according to the announcement Tuesday.

Funding is continuously pouring into the booming robo-adviser space as investors' shift to managing more of their lives online in response to the pandemic has given the digital-advice industry a tailwind. M1 Finance, for one, announced last Wednesday that it had reached unicorn status after raising another $150 million in funding that propelled the robo-adviser’s valuation to $1.4 billion. 

Titan, like its fellow robo-advisers, has experienced rapid growth over the last 12 months, crossing its first $500 million in assets under management as of March with 26,640 users on the platform, according to the firm’s latest Form ADV. Titan is expecting to reach its first billion in assets under management later this year, just over three years after launching, according to the announcement. 

Titan’s growth is considered “remarkable” since the firm was founded in 2018, according to Backend Benchmarking’s first-quarter Robo Report.  Although many smaller robo-advisers have struggled to distinguish themselves among the juggernauts, some firms that have unique value propositions have experienced significant growth in assets and funding. 

Titan differentiates itself from other robos by actively selecting individual stocks. Over the past year, Titan’s equities returned 71.96%, according to Backend Benchmarking. The strong returns led it to outperform its benchmark by 12.43%.  At the end of the first quarter, Titan's three largest holdings were Paypal, Twilio and Apple. Those holdings are representative of the larger portfolio, which is tilted towards large-cap growth stocks.

Last June, when the market was in the depths of a pandemic-fueled downturn, Titan proved its investment strategies were successful when it shorted the market and won. Titan not only outperformed during the downturn but blew competitors out of the water. The portfolio had the best one-period return above or below the normalized benchmark researchers ever witnessed. 

A new crypto offering called Titan Crypto will be the firm’s latest move to stand out against the competition. 

While other robo-advisers like Wealthfront and Makara are ready to serve as entryways for new market participants to gain access to crypto investing, Titan claims that it will be the first first actively managed crypto portfolio available to all U.S. investors with a minimal correlation to U.S. equities and hedging qualities.

The offering is expected to launch “in the coming months” now that Titan has closed its Series B, according to a company blog. 

Titan is currently letting investors sign up on its waitlist, offering Titan Crypto for no fees for anyone who joins the waitlist before the launch. Titan’s low investment minimum of only $100 lets mass-affluent investors access high-end market strategies. 

What Fidelity and its iconic mutual funds were for baby boomers, Titan is hoping to attract a new generations of investors, the firm noted in its announcement.

“There’s been a reawakening of active investing,” Joe Percoco, co-founder and co-CEO of Titan, said in the announcement. “But traditional investment management vehicles remain the techequivalents of VHS tapes. The industry needs a new operating system.” 

Titan’s Series B fundraising was led by Silicon Valley venture capital firm Andreessen Horowitz, with participation from existing investors including General Catalyst, BoxGroup and Ashton Kutcher's Sound Ventures.

The round also features participation from pro athletes and celebrities including Kevin Durant, Odell Beckham Jr., Jared Leto and Will Smith. Anish Acharya, a general partner at Andreessen Horowitz, will be joining Titan's Board.