Covestor, an online marketplace for investing, announced today it has raised $12.75 million in a Series B financing round. Investors in the round included Union Square Ventures, Spark Capital, Amadeus Capital Partners, and Bay Partners. The Series B financing brings the total capital Covestor has raised to $28 million.

Covestor will use the proceeds to accelerate its growth and continue its mission of providing investors with access to alpha-focused portfolio managers in an online marketplace. With over 100 portfolios available on covestor.com, the company provides exceptional levels of transparency and liquidity to investors who believe that actively managed portfolios can perform better than index averages.

The 10 most popular managers with the most client assets invested in their Covestor portfolios have beaten the S&P 500 index by 28.5%, gross of fees, over the last year (as of June 10).

"Research has shown that smaller, more nimble managers can outperform large hedge funds," said Sanjoy Ghosh, Covestor's recently appointed Chief Investment Officer. "This is why we are excited to help investors connect with portfolio managers we specifically select from thousands of people who propose to offer their products on Covestor's marketplace."

Ghosh joined Covestor in May from PanAgora Asset Management where he was Director of Investments. Prior to that, he worked at Putnam Investments.

The company's previous rounds of financing were used to build Portfolio Sync, a proprietary trading capability that replicates trades of hedge fund managers, individual investors, and other active portfolio managers. Covestor's Portfolio Sync software platform has successfully replicated over 500,000 trades.

Covestor's CEO, Asheesh Advani, said, "The industry appears to have abandoned active money management. Covestor has not. We have observed how portfolio managers, emerging hedge fund managers, and investors have been able to outperform the market. Our marketplace connects investors who seek higher than market index returns with a curated set of managers who share that goal."

Covestor relocated from New York City to Boston's financial district in November, 2012. In recent months, the company announced the appointments of two new board members:

Independent Board Member Jamie Cornell, former President of Private Wealth Management at Fidelity and currently Managing Director of Bollard Group, a multi-family office.

Independent Board Member John Sinclair, former Director of Research at Fidelity and currently Managing Director at Infusion Global Partners, an alternative asset management firm.

In May, Covestor also hired a New Business Manager, Compliance Analyst, Controller and Developer.

About Covestor
Founded in 2006, Covestor is widely regarded as a pioneer in bringing separately managed accounts (SMAs) online in a transparent marketplace. Investors can compare and select from a transparent marketplace of money management talent that includes renowned portfolio managers and seasoned investors. Covestor's Portfolio Sync technology automatically replicates trades, providing clients the convenience of "set and forget" functionality and the protection of Covestor's proprietary trade filtering. The company has offices in Boston and London.

Covestor is an investment adviser registered with the US Securities and Exchange Commission under the Investment Advisers Act of 1940. Additional information can be accessed directly from our Form ADV document, available at http://www.covestor.com.