EarlyBird, a mobile application that enables families and friends to gift investments to children, has successfully secured $4.5 million in a seed extension round, with a notable portion of the funding coming from its user community. The app empowers parents to create custodial accounts, commonly referred to as UGMA (Uniform Gifts to Minors Act) accounts, facilitating investments in stocks, bonds, mutual funds, and various securities on behalf of their children. These investments ultimately transfer to the child when they reach the age of 18. Beyond saving for college, the funds can be utilized for purposes such as contributing to a home down payment, seeding a child’s first business, exploring the world, planning for retirement, and more.
During an interview with TechCrunch, EarlyBird’s founder and CEO, Jordan Wexler, highlighted the unique community-based nature of the platform, explaining how it presented an intriguing opportunity to gauge user interest in participating in the funding round. He mentioned, “We sent out a feeler email to our user base, and it was by far the most engagement we’ve ever seen on a survey like that.” Consequently, the startup decided to open up an allocation specifically for the parents who were investing in EarlyBird, and this allocation was swiftly subscribed within the first 48 hours.
Wexler emphasized the importance of creativity in today’s competitive startup landscape, stressing that innovative approaches are crucial for survival. The funding round was led by IDEO Ventures and attracted participation from EarlyBird’s existing seed round investors, including 776 Ventures, Fiat Ventures, and RareBreed Ventures, as well as new investors like ResilienceVC, Sweater Ventures, Alumni Ventures, Goodwater Capital, Wintrust Bank, Lightspeed Scout Program, and Parallel.
With this latest funding, EarlyBird has raised a total of $10.9 million. The company previously closed a $4 million seed funding round in November 2021 and a $2.4 million pre-seed round in November 2020.
EarlyBird’s plans for the funds include expanding its focus on community-based investing, driven by the realization that investing in a child is a deeply emotional experience. To enhance this aspect, the platform incorporates social features, such as allowing users to create video memories that provide context for their investments.
Additionally, EarlyBird intends to refine its investment services by offering multiple customized portfolios for parents to choose stocks as their child grows. The company is also exploring the incorporation of college savings 529 plans into its offerings.
While presently concentrating on the 0 to 7-year-old demographic, EarlyBird envisions providing services for the entire journey from 0 to 18+. The goal is to build a dedicated experience for teenagers, eventually becoming their primary brokerage account at 18, thus establishing a lasting financial relationship.
