Capital One Buys Millennial Budgeting App Level Money

Capital One has acquired San Francisco-based money management startup Level Money, continuing the bank’s push into digital money management.

Terms of the deal were not disclosed when it was announced on Monday (Jan. 12), but Level Money had raised $5 million in an October 2013 Series A funding led by Kleiner Perkins, TechCrunch reported. Level Money’s iOS and Android app had 700,000 users at the time of the acquisition.

The startup will now continue on as a part of Capital One, but will remain a standalone application, and the 11-member Level Money team will also stay together, including CEO Jake Fuentes.

The app, which connects to 250 U.S. financial institutions, helps users track spending and keep better control over their money in multiple accounts. The app is specifically aimed at users in their 20s and early 30s who are focused on how to pay back student loans and setting savings goals. Level Money also makes suggestions for what to do with extra cash left over at the end of a month — for example, whether to put it toward an extra loan payment or invest it.

In a blog post announcing the deal, Level Money CEO Fuentes said the deal help his company continue to evolve and grow, called Capital One “much younger and nimbler than any other top bank” and said it is “on a mission to transform the way banking is done.”

For its part, Capital One wouldn’t say directly how it plans to to monetize its new investment, but called the Level Money deal “one of many steps that Capital One is making to deliver a next-generation banking experience.” That may be less vague an answer than it sounds; a recent report from BBVA found that banks must improve their digital cred if they want to attract Millennials to use their services.

Capital One has also snatched up other money-management startups, including spending tracker Bundle in late 2012 and BankOns. More recently it bought San Francisco-based design and user experience consultancy Adaptive Path.