It's been a minute since I just dumped things from my brain onto the Smoov blog so I figured since I had too much caffeine today, I'd use the extra boost to spew some thoughts down...
First and foremost, can you think of any cool apps the help you with your money?
Chime... kind of.
Mint... not anymore.
The list of middle of the road fintech apps behind these ones with no brand to support them and cool community of engaged fans users goes on and on. But that's not the point of this note.
The point is, what we're building at Smoov is aimed to flip the consumer fintech industry on it's head.
The point is to give people finance products that they actually want and need.
That's what has made Robinhood, Chime and Mint successful.
- Robinhood made it easy for people with no experience to start investing and learning about the stock market with very little risk.
- Chime helps people rebuild their credit, without the risk of going into debt.
- Mint helped people get a handle on their spending by bringing everything under one hood.
But there's more than meets to eye to why these apps succeeded.
In a world where timing is everything all three of them piggy backed on a zeitgeist that propelled them forward.
Robinhood first launched in 2015 when their target demographic, Millennials, were just getting out of college and starting to make their own money. For the first time a generation that was largely tech savvy, was making their own money and could now manage it in a way they expected. Easily from their phones.
Chime noticed that Millennials were leaning more towards debit than credit cards, which was a double edged sword because it protected them from going into high interest credit card debit, but it also wasn't helping them build their credit which is obviously inportant for buying a home or a car. They launched their credit builder product in 2020 causing them to 3x revenue from 200M in 2019 to 600M in 2020. In 2022 they did $1.8B... They broke out on the heels of this macro trend.
Mint noticed that the young professional crowd was being neglected. Old enough to be working and making and spending their own money, but young enough to not be working with a financial manager. They built a brand on the back of this observation. They gave this audience a safe and secure place to view all of their spending in one spot. But their breakout functionality was to allow these users to set goals. Something none of their legacy competitors were doing. They also were best in class at categorizing expenses. No one else was doing either of these two things or speaking to the younger audience with such authenticity.
Let's land the plane here and talk about how Smoov is piggy backing on some major macro trends today.
They're each others top recipient across all venmo transactions.
Millennials and Gen Z get married later in life than any generation before.
But Gen Z is moving in together sooner than ever before.
These decisions literally all have to do with money.
What should they do? Join bank accounts? Well we all grew up with the old 50% of marriages end in divorce stat... that's a fun one. As a matter of fact by getting married later in life we're actually changing that and driving it down. But no becasue as cited above, they're delaying getting married as it's a "financially risky decision."
Plus by growing up for longer, working later into their career, growing their respective net worth and increasing earnings, these couples have a deep deep deep rooted sense of financial autonomy. AKA, it's my money, I can buy [insert impulse buy here] if I want.
So what do they wind up doing? Sure some couples still join accounts. Statistically speaking that number is down roughly 40% from Baby Boomers to Millennials but it certainly still happens. For example there are 14 Million married millennials with no shared bank accounts whatsoever. So how do they do it?
Regardless, one partner reluctantly becomes the CFO of the relationship and they do it MANUALLY.
So why NOW is the best time for Smoov? Not just because Smoov is a verb...
"Hey babe you're going to Smoov that right."
While Millennials already love the prospect of automating their shared expenses because they're a little bit further into their relationship stages than Gen Z and have more experience with the death by a thousand cuts experience of co-managing expenses manually with their partner. Gen Z is fast approaching these relationship milestones of moving in, getting a dog, getting engaged and married etc etc.
And as the most individualistic and tech native generation yet enters these phases, Smoov as the de facto finance solution for young couples has a lovely ring to it.
Ultimately, we're starting with shared expenses, but what we're building is the only finance tool couples will ever need.
How does it work?
Smoov connects with all your existing credit and debit cards.
If you want Smoov can notify you when you use one of those cards and prompt you to split it.
Couples set up a split % that makes sense for them - every relationship is different and 50/50 doesn't always make sense.
Each partner adds expenses from their private view, to the couples shared view.
Smoov does the math based on their split %.
Couples settle up directly inside of Smoov - bye venmo!
Couples have a history tab to search for previously split expenses.
Check it out:
Ohhhhhhh and of course for all you soon to be former mint users, we can help you with your budgeting and goal setting stuff too. 😜
Thanks for reading my rant and if you made it this far, do me a favor and pre-order Smoov on the app store.
Tuck from Smoov