The Austin-based company, unlike robo-advisors such as Betterment and Wealthfront, provides retirement plan services for SMBs. Using mutual funds from Vanguard, it provides a low-cost and simple-to-use interface.
Honest Dollar will become part of Goldman's investment management division and represents the latest in Goldman's series of fintech investments across sectors.
A recent surge of private investment in financial technology companies has prompted the biggest banks in the US to consider whether they would rather buy, build or partner to keep pace with the newcomers. Goldman, which prides itself on its vast team of software engineers, has mostly bought or built, last year launching an internal venture to challenge the likes of Lending Club in loans to consumers and small businesses. It is also a driving force behind Symphony, a big consortium of financial services firms aiming to unseat Bloomberg from its dominant position in messaging.