London-based Penfold wants to digitally disrupt and modernize the UK pensions industry, particularly for the self-employed who often struggle to save for retirement.
Penfold CEO Pete Hykin told TechCrunch: “I was self-employed for two years so had no pension. I tried five times to set one up with Scottish Widows, Standard Life, AJ Bell, etc. I gave up, as all of them forced you to print something, call them, or speak to an IFA.
“At a previous company, I set up a workplace pension for 70 staff and none of them engaged. Many left money on the table as a result.”
Now the startup has raised $8.5 million; $4 million of which came through a crowdfunding campaign.
The investment round was led by Bridford Group and the family office of Jorg Mohaput, an Angel investor. MMC Ventures also participated in the round.
Unlike the outdated paper-based nature of the rest of the UK pensions space, Penfold’s FCA-approved app is quick and easy to set up and use. It then allows savers to choose from five investment plans that best suit their preferences.
Importantly for the self-employed, Penfold’s platform allows them to receive their tax relief bonus directly from HMRC into their Penfold pension pot, as well as enabling them to consolidate previous pension pots into their Penfold one.
The company plans to use the funding to continue to build out its modern pension platform, including with the launch of a workplace pension scheme.
This offering is free for employers and comes with support to help them with the switchover. It also provides benefits, perks, and salary sacrifice schemes directly to employees enrolling in the scheme.
It is clear that Penfold wants to bring efficiencies to UK pensions with the help of technology – and in doing so, challenge the other digital pension option on the market: PensionBee.