Expand Financial, a Denver-based retirement industry consultant, today announced the closing of its acquisition of fintech startup Dream Forward’s 401k business.
“This acquisition continues our strong growth, as we look to bring Dream Forward’s 401k clients into the Expand ecosystem,” said Greg Bakke, President. “Dream Forward offered their clients excellent customer service and a unique retirement plan model, and we are excited to continue to provide their clients exceptional service.”
eFA, a Registered Investment Advisor (RIA) affiliated with Expand Financial, is currently the 3(38) fiduciary on most Dream Forward plans being acquired, and this acquisition allows Expand Financial to enhance the existing relationship with this additional consultancy role. The firm works exclusively within the retirement plan advisory space and offers related services ranging from 3(21)/3(38) investment monitoring and reporting to full plan consulting services.
“Expand Financial was an existing business partner, and thus was a natural fit to acquire our business,” said Dream Forward Co-Founder Ryan Kahn. “They own the book of business and will service the clients going forward.”
Terms of the deal, has been in the works since 2019, will not be disclosed.
What’s next for Dream Forward
Dream Forward’s 401k business was established to offer small businesses a new kind of modern, low-cost solution. Founded in 2016, Dream Forward’s technology is designed to simplify and streamline the administrative process for plan sponsors, in order to make 401k plans more accessible to small businesses.
With the completion of the 401k business sale, Dream Forward says it will continue to operate its technology licensing business, white-labeling its proprietary retirement chatbot technology to the industry.
Dream Forward says its chatbot helps improve participant outcomes, and can explain all of the nuances of saving for retirement and 401k rules and regulations.
Kahn, the “engineering brains” behind the chatbot, says it was designed to solve the problem of 401ks being “incredibly dense, jargon-heavy, and difficult for the average American (with limited financial knowledge) to understand,” with terms like vesting schedules, cliff vesting, in-service withdrawals, TDFs, CITs, QDIAs, etc., “all making 401ks less approachable,” he says.
“Given these challenges, our AI is built to accommodate different levels of financial literacy. The AI understands the true meaning behind users’ questions like ‘what happens if I get hit by a bus?’ If employees can chat in plain English, 24/7, it helps them get more comfortable with using the 401k plan,” Kahn says.
In addition, Kahn notes the AI is designed to be proactive. “If employees try to do something with a negative impact – like lower the amount they’re saving each paycheck on the website—the AI will pop up, intervene, and ask the user why they lowered their saving amount,” Kahn says. “The AI can discuss all kinds of competing financial goals—like saving for college or a home—to try to keep users on track for retirement.”
More information on Dream Forward’s chatbot technology can be found by downloading a copy of the “Retirement 2058: What artificial intelligence reveals about 401k plans” whitepaper.