MPower Builds Muscle With Recap Deal Inc. is like a whole new company. Along with a $7.8 million round of financing expected to close on Tuesday, the San Francisco-based startup has a new capitalization table, new pricing policies and new management.

The new chief executive officer, Andrew Huddart, says that the eight months he has been with the 7-year-old company have basically been a restart, turning a dot-com into a proper financial services company.

MPower runs an online financial planning tool integrated with the online portals of 20 defined contribution plan administrators. As a registered investment advisor, MPower presents plan participants with personal asset allocation recommendations based on answers to a set of questions.

Since joining the company, Huddart says it has cut its burn rate significantly. Its headcount has been reduced to 55 employees from 300, and it has renegotiated its lease accordingly. The company has also renegotiated other vendor contracts and reengineered its deals with its clients, changing the pricing policies.

These reforms lead Huddart to believe that this latest funding round will take the company to cash-flow break-even. The latest funding round, an inside round, was led by Capital Z Financial Services Fund II LP and joined by Norwest Venture Partners, Allegis Capital, Northwestern Mutual and Reuters Group PLC. After a recap, this new money owns the only preferred stock left in the company.

“I like to think we neutralized a lot of the sins of the past,” Huddart says.

The company counts 1.2 million plan participants as potential users of its product – that’s if all the employees of its 300 client employers signed on. Huddart says MPower’s utilization by employees increases over time. After three months of having the product, 9% of eligible employees use the service, but after two years, over half of a plan’s participants are on board.

MPower is also expanding into other areas of financial advice and wealth management. For example, it also counts 200,000 users through its relationship as the financial advice planner for CNBC on MSN Money. Huddart says MPower will soon expand its customer list beyond defined contribution plan administrators to other financial institutions – such as traditional financial advisors.

“I like to think of this as a company that – although it was invented in the dotcom age – has some future and has been able to reset itself,” Huddart says.