Motif Investing, an upstart online broker, has attracted the nation’s biggest bank as a backer.
JPMorgan Chase has joined with other firms to invest $35 million in Motif, the company announced on Thursday. The deal is a significant vote of confidence in Motif, which received an investment from Goldman Sachs last year.
The investors in the financing round included Wicklow Capital, a fund formed by Daniel Tierney and Stephen Schuler. The two men co-founded the high-frequency trading firm Getco (which merged with Knight Capital last year). Balderton Capital, a European venture capital firm, also invested.
A representative of JPMorgan is expected to join Motif Investing’s board as a nonvoting member, the company said. The board also includes Sallie L. Krawcheck, a former big bank executive; Arthur Levitt Jr., a former Securities and Exchange Commission chairman; and Darren W. Cohen, a Goldman managing director, who, like the JPMorgan representative, does not get to vote.
While Motif Investing and JPMorgan declined to discuss details of their talks, the investment appears to be a strategic one. Motif may be hoping to gain access at some point to JPMorgan’s vast customer base.
“It’s always helpful to have companies that understand the financial markets, that are serving on our board as observers,” Hardeep Walia, the chief executive of Motif Investing, said in an interview. “There’s always value to having companies like Goldman Sachs and JPMorgan.”
Mr. Levitt, who works as an adviser to Goldman, put it this way: “Hardeep is mining the fields thoroughly in terms of seeing whether any of his investors are able to be strategic and create opportunities that are commercial, not merely passive investors.”
Motif Investing, based in San Mateo, Calif., opened its doors in 2012. The company lets investors buy a basket of stocks centered on a theme, like “robotic revolution,” “seven deadly sins” or “Obamacare” (“Repeal Obamacare” is also available). Investors can also create their own themes. The company charges $9.95 for a so-called motif, a portfolio of up to 30 stocks.
Separately on Thursday, the firm announced a new product geared toward financial advisers, offering a way for advisers to monitor and rebalance their clients’ portfolios. The service will charge advisers a monthly fee per customer.
Phil Di Iorio, chief executive of JPMorgan’s global wealth management business, said in a statement that Motif “is driving powerful innovations in the wealth management segment.”
Mr. Walia’s vision has clearly resonated with the bank. He posed for a picture recently with Jamie Dimon, JPMorgan’s chief executive, who was all smiles.