Benjamin Döpfner, CEO & Founder of Vesto – Interview Series

Benjamin Döpfner, is the CEO & Founder of Vesto a cash management platform that enable startups to put their idle cash to work.

At 15 you launched your first startup, can you discuss the cash management issues that came up with managing your company funds?

I grew up in Germany and started my first company at 15. I bootstrapped the company and scaled it to millions of dollars in revenue in a matter of months. However, interest rates in Europe were negative at the time, so we were paying our bank 0.5% on deposits and as a result, our cash was just slowly melting away. I asked our bank about their cash management offerings and was immediately turned away for being a startup, and not meeting sky-high minimum deposit requirements.

How did this then transition to the idea of launching a cash management solution for startups?

After being turned away, I set out to build my own internal cash management tool and quickly discovered just how resource-intensive this can be, especially for a startup. As I went through building this out, I realized that this was a problem businesses of all sizes face and the idea for Vesto was born.

How does Vesto automate investing capital for startups?

Our platform automates the setup and day-to-day management entirely, allowing our customers to diversify and earn higher yields on their cash, with an intuitive and user-friendly experience.

What types of investments and securities does Vesto participate in and why were these chosen as the best option?

When we onboard new customers, we build out a custom portfolio that prioritizes safety and liquidity above all. Therefore, some of our most popular investment choices include short-term U.S. Treasuries, money market funds and cash sweeps.

Vesto takes advantage of what’s called a treasury ladder, what is this specifically and how does it help with liquidity?

Treasury ladders are a way to stagger the maturity dates of your T-bills, bonds or CDs to ensure that some of your cash will mature when you may need it. Typically, you will want a mixture of maturities with different timescales. Treasury ladders, if well planned, can help startups avoid being caught off guard by rising interest rates that can cause the price of bonds to fluctuate.

Why is Vesto a better option than robo-advisory solutions?

Unlike other cash management companies that are “one size fits all,” Vesto allows its customers to use a highly customized approach tailored to their needs, risk tolerance and financial goals.

We recognize that what works for a pre-seed stage company is not going to work for a growth stage company with hundreds of millions in the bank. Vesto works directly with companies to create a custom portfolio that matches their financial situation and takes into account their own investment restrictions, board reservations and cash projections.

Can you discuss where the funds are physically held, how they are kept secure and why startups should trust Vesto?

As an SEC Registered Investment Advisor, we are restricted from ever having access to our customer funds and are subject to strict regulatory safeguards to entrust the safekeeping of customer assets. This means that we are never in the flow of funds, and our customers alone own the legal rights to their custodial account at all times, with independent account access.

A Vesto account essentially gets you the benefit of an institutional custodian with little operational effort, a much friendlier product experience than most traditional banks and a completely automated investment management process.

What type of information and tools are available with the Vesto dashboard?

Through the Vesto platform, our customers are able to get real-time visibility into their portfolio, connect external bank accounts, accounting systems, access account statements and see what's going on with their cash. On top of this, we’re building a first-of-its-kind financial planning platform centered around automation and insights, connecting disparate financial data from best-of-breed systems and intelligently combining data into a single view – giving businesses unprecedented visibility into their financial health.

How does Vesto monetize?

Vesto makes money by taking a percentage fee on AUM (assets under management) in our customers' accounts.

What is your vision for the future of Vesto?

My long-term vision is to create one of the most powerful financial operating systems for companies. I believe that Vesto could be the world’s most valuable financial software company in a decade. As the sole founder of the business, this is what keeps me motivated and excited each day.

Thank you for the great interview, readers who wish to learn more should visit Vesto.