What it does: Betterment has one of the easiest-to-use, slickest interfaces to manage a balanced portfolio for long-term investors. Fund your account (you can automate this) and dial in your preferred risk mix and Betterment chooses a basket of exchange-traded funds (ETFs) for your portfolio in accordance to Modern Portfolio Theory. You don't ever need to decide on what to buy if that's not your thing.
Particular strengths: For investors who don't want to be overwhelmed with investing decisions or jargon about individual securities, Betterment has done a really effective job removing the confusing part by getting investors to focus on what really matters: setting goals, focusing on time-frame, and risk.
How popular is it: As of November 2011, Betterment reported that it had 10,000 accounts and $36 million under management.
Management: Betterment was founded by Jonathan Stein, an experienced professional on the technology side of the financial industry.
Company Size: Betterment has 10 employees (Source)
Outside Investors: Bessemer Venture Partners led an investment round of $3 million at the end of 2010.