Stash Asks Millennials to Skip the Beer and Invest the $5 Instead

  • Philip Ryan
  • February 9, 2016
  • 1

© Can Stock Photo Inc. / ronstikStash, a new investing app for millennials, announced a $3 million raise today, bringing its total funding to $4.5 million.

“70% of people under 30 don’t invest,” CEO David Ronick told Bank Innovation. “They say, ‘We know we need to save and invest,’ but it’s intimidating. Buying a share of Apple for $100 or so is scary.” With Stash, Ronick said, users can get started in as little as two minutes and invest as little as $5. This may not seem like much, Ronick said, but we often throw out $5 on things we don’t value that yield no return, like a beer or coffee.

Stash does not charge commissions for buying or selling investments and has a $1 monthly subscription fee for accounts under $5,000. It is 0.25% a year for balances over $5,000. The first three months are free for all accounts, which currently number over 40,000.

“We look at it from a weight-loss perspective,” Ronick said. “There are a lot of emotions around it. It seems hard to get started. You have to start with small steps.” Further, Stash has users fill out a profile and then suggests investment vehicles that matter to them — a key issue for millennials that older investors might have difficulty understanding.

Actually, Stash doesn’t like calling younger customers “millennials,” Ronick said. Millennials, by some counts the largest generation ever, defy simplistic generalizations, as all large groups do. Still, there are some commonalities Ronick was able to point to that made building Stash for them a manageable task:

They value a simple, well-designed mobile user experience, and the ability to do things on the go that older generations may have done by phone or in-person. For example, we’ve heard many of our customers say the idea of calling an investment adviser who is 50+ year old man in a suit and tie, and reading through complex reports, doesn’t seem to fit their lifestyle. They are new, or fairly new to investing, and are open to new ways of thinking about it. Venmo came up again and again when we initially interviewed customers. Many of them praised Venmo, while many older people we interviewed were not as open to trusting the app, or to its social functionality.

Stash allows users to invest in small amounts and to buy fractional shares, unlike rivals such as Robinhood. Users are encouraged to diversify and buy into “funds” — bundles of investments assembled by Stash — such as Roll with Buffett, which allows investments in Berkshire Hathaway. Stash presents investment opportunities based on 30 investment vehicles it has created, and makes suggestions based on users’ profiles and previous behavior.

The recent funding round was led by Silicon Valley-based Goodwater Capital, which specializes in early-stage consumer technology companies. New York-based Valar Ventures, and London-based Entrée Capital also took part. The funds will be used to build an Android version of Stash, which is currently iOS only, and grow the customer base.

Stash is based in New York and was founded in Feb. 2015.

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Philip Ryan is Senior Editor of Bank Innovation and Senior Director of INV Fintech. He began covering financial services in 2012 and has more than 15 years' experience in online journalism. He can be reached at

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