Financial Finesse, an independent provider of financial wellness coaching, is expanding its operations to include a venture capital arm that will invest in socially responsible fintech companies for the financial services and consumer industries, the company announced.

Financial Finesse Ventures has been launched to support fintech companies that are trying to bring new solutions to problems faced by financial firms, Liz Davidson, founder of Financial Finesse, which is based in El Segundo, Calif., and CEO of both Financial Finesse and Financial Finesse Ventures, said in an interview.

The venture capital arm of the company will act as an incubator by funding companies that abide by ESG and diversity, equality and inclusion standards, and that propose new approaches to existing problems, Davidson said. All of the money invested in the startup companies will be socially responsible and will be aimed at having a positive social impact on individuals’ lives, she said.

“Our goal at Financial Finesse is to reduce financial stress for employees” of firms that use our employee benefits, she said. “Through Financial Finesse Ventures we want to fund companies with the same goals that otherwise might not receive funding." Companies that might be funded cannot be named as yet but the selection process will be made slowly and deliberately and will unfold over a number of months and even years, she said. “We want to fund companies that are trying to solve big problems.”

The first investment announcement will be made next month. Fund amounts and equity stakes will vary depending on the company’s needs. “In general, we are looking for early stage and Series A investments,” Davidson said.

“While there is increased discussion about social responsibility and some encouraging macro trends in the ESG space, fintech is significantly lagging in these areas,” Davidson said in a statement. “We are at a critical crossroads. What we do now as investors, employers, and consumers has the potential to change the trajectory of the industry. Fintech has the potential to be a powerful solution.”

“We have seen a surge in fintech firms with predatory practices selling their services to employers as an employee benefit,” Greg Ward, director of the Financial Finesse Financial Wellness Think Tank, said in a statement. Financial Finesse Ventures will use pro-consumer models and will quantify the potential social impact of companies that receive funding, he said.

“Financial Finesse Ventures is a long overdue addition to the venture capital and FinTech industries,” Elaine Hagan, associate dean of entrepreneurial initiatives at the UCLA Anderson School of Management, who works with entrepreneurs to accelerate growth of their businesses, said in a statement.