Mike Nelson, co-founder and CTO of Guideline, grew up in Maine and based the company’s engineering team here when it launched in 2015. (Photo/Guideline)

Guideline, the five-year-old tech company offering a software platform to allow small businesses to offer their employees retirement plans, recently raised $85 million as it continues to grab market share and modernize the 401(k) industry.

The company has raised $144 million since it was founded in 2015 by Kevin Busque, Mike Nelson, and Jeremy Caballero. This financing round (its Series D) was co-led by Al Gore’s Generation Investment Management and Greyhound Capital, and also included Tiger Global Management, Felicis Ventures, Lerer Hippeau, Propel Venture Partners, Xfund, and BoxGroup.

Though San Mateo, Calif., is its headquarters, it employs roughly 50 people in its Portland office, including the majority of its software engineering team. (More on the company’s Maine roots below.)

The raise comes on the heels of fast growth. Guideline provides a SaaS platform for small businesses that want to offer retirement plans to its employees. According to the company, 90 percent of small businesses do not offer their employees a 401(k), so the company’s potential addressable market is large.

Guideline now manages $2.5 billion in assets for more than 13,000 small business clients—up 230% and 140%, respectively, since Guideline’s last raise in December 2018. In the same period, its annual recurring revenue grew by 160% and total participant count grew by 165%. Guideline ranked 7th in the country out of all providers for new 401(k) plans added in 2019.

The pandemic and resulting spike in unemployment has not slowed the company down. In June alone, Guideline signed more plans than any month this year aside from January, marking a 65% year-over-year increase in sales from June 2019.

Maine roots

Nelson, who serves as the company’s chief technology officer, was born in Maine and moved back to the state from the San Francisco area not long before he co-founded the company with his two partners.

Nelson has said previously (I featured him in this article I wrote for Maine magazine) that it wasn’t a hard sell to convince his partners to base the company’s dev team in Maine, and that he’s found the Portland talent pool to be very talented, though not deep.

“So then it becomes about becoming an attractive business in the area,” Nelson said.

Though it’s hard to compare compensation across private companies, anecdotal evidence suggests Guideline is one of the local companies that understands (even before COVID-19 made remote work the norm) that it’s competing for talent not just with other local companies, but with companies in Boston, New York and beyond.

That’s what raising $144 million will allow you to do.

And the company is hiring. Busque, who serves as CEO, told Maine Startups Insider that the company spent $1 million to renovate its Portland office and made sure it has the space to at least double its local headcount.

“We will be there for the foreseeable future,” Busque said. “It’s very economical rate compared to the Bay Area. We invested in it, we made room for expansion.”

Besides engineering, the Portland office also houses customer support, product ops, and backend aspects of compliance.

“We run the gamut over there,” said Busque, speaking to MSI from the Bay Area. “The G&A function is only one not in Portland office.”

Interestingly, Busque also has Maine roots. His gradfather was born in Lewiston and his parents grew up in the Moosehead Lake region. He lived in the state briefly when he was younger, but primarily grew up in the Boston area. Though he lives in the Bay Area, he said he still considers himself a New Englander.