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Alumni News — Week of May 30, 2011

By Julie Muhn (@julieschicktanz) Posted on June 6, 2011
Categories: Betterment, BrightScope, ChargeSmart, Check Point, ClairMail, Corduro, Credit Sesame, Currensee, Doxo, Dwolla, Enloop, Geezeo, Guardian Analytics, HelloWallet, Hidden Levers, Lending Club, Lendio, PayNearMe, Prosper, Robot Dough, SecondMarket, Simple Tuition, Sybase 365, TradeKing, Tyfone, UBank

Betterment

Medill Reports discussed the benefits of Betterment and Currensee, claiming that the social networking craze changes the way some people invest. Link

BrightScope

BrightScope announced the top 10 treasury inflation protected securities funds in America’s 401ks. Link

ChargeSmart

Fox News’ Studio 10 reviewed ChargeSmart, PlasticJungle, and Bills.com and found a number of money saving tools and ideas. Link

Check Point Software Technologies

Check Point Software Technologies won The Ten Best Web Support Sites of 2011 Award from The Association of Support Professionals for its exceptional web support design, implementation, and customer experience. Link

ClairMail

ClairMail announced record customer expansion with a 300% year-over-year growth in users. Link

Corduro

The New York Times reported that Corduro’s cloud platform challenges PayPal and Square’s mobile payment services. Link

Credit Sesame

The Wisdom Journal depicted Credit Sesame’s services as more than just credit scores. Link

Currensee

See Betterment above.

doxo

doxo explained how to use its online filing cabinet and “due date” alerts to help organize GroupOn, Living Social, and other daily deals. Link
TheFinancialBrand.com discussed Oregon Federal Credit Union’s use of doxo and discussed other usage ideas such as uploading a scan of your passport prior to travelling. Link

Dwolla

Credit Union Times listed Dwolla as a contender in the P2P payment space. Link
Dwolla rallied community efforts to gather donations for the tornado-stricken town of Joplin by selling its t-shirts and accepting donations. Link
Omaha World-Herald covered Dwolla’s arrival into Nebraska. Link

Enloop

About.com highlighted Enloop’s business plan creation service. Link
Forbes blog discussed “How Not to Fail” by using Enloop to assess the potential success of a business plan. Link

Geezeo

Call Federal Credit Union, based in Richmond, VA, selected Geezeo for its PFM solution. Link

Guardian Analytics

Guardian Analytics positioned by Gartner in the “Visionary” quadrant for web fraud detection. Link

HelloWallet

San Francisco Mayor Gavin Newsom urged residents to improve their money management by using HelloWallet. For every five subscriptions purchased, HelloWallet will give away one subscription to a family in need. Link

Hidden Levers

Financial Advisor Blog discussed using Hidden Levers to build better portfolios, highlighting risk management and accuracy of the service. Link

Lending Club

Lending Club exceeded a quarter million dollars in cumulative loans and is offering cash bonuses. Link
Wall Street Journal blog discussed growth of P2P Lending sites Prosper and Lending Club. Link

Lendio

Lendio raised $2 million in debt financing. Link

PayNearMe

PayNearMe founder Danny Shader, in an interview with Vator News, revealed the service is used beyond the unbanked population, including teens who prefer to pay with cash and consumers who would like to keep their online transactions private. Link

Prosper

See Lending Club above.

RobotDough

Dow Jones Financial reports that a UCLA professor backed RobotDough. Link

SecondMarket

The Washington Business Journal discussed SecondMarket’s recent popularity. Link

Sybase

Sybase launched the M-Commerce Guide, a publication for examining global market opportunities for mobile network operators, advisors, and FIs. Link

TradeKing

TradeKing CIO Dan Raju discussed security issues that may arise with the NYSE cloud community, citing its security. Link

Tyfone

Tyfone contracted with Star One Credit Union to use its NFC technology.
Link

UBank

CEO of UBank examined security concerns and competitors during an interview with ZDNet. Link

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What is the ROI of banking innovation?

By Jim Bruene Posted on June 3, 2011
Categories: Fee Income, Pricing, Strategies

An executive on the front lines of product development at a major financial institution recently asked me this question:

How can I prove that innovation really matters to the bottom line?

I’ve been a “product guy” my whole career so I take it for granted that “building a better mousetrap” eventually trickles down to a boost to the bottom line. That worked at Microsoft, Apple and Caterpillar (my first job).

But they are manufacturing companies. That better mousetrap, be it Win95, the iPod, or a D10 tractor, brought in direct, usually profitable, revenues.

It’s harder if you are a retailer. If the Gap spends a million dollars to improve search and discovery on its website, will it really sell enough extra jeans and sweaters to make the investment back, let alone earn an acceptable return?

Banks are both retailers (branch and online) and manufacturers (checking accounts, loans). But today, the P&L from their digital efforts is more like the Gap than Apple. You have to sell a lot of extra checking accounts and car loans to justify even a modest website investment. This has held back digital investments for 15 years (see note 1).

But what if banks started acting more like a manufacturer when it comes to digital products, by creating new services to package and sell on their own merits.

For example, instead of spending a couple hundred thousand every year to give everyone remote check-deposit capabilities free of charge, create a new digital product called, The Magic Check Deposit Service, and sell it for $2.99/mo. This product not only reduces costs, since it will have far fewer lapsed and/or clueless users, but also pegs a monetary figure to the service, thereby increasing its perceived value even if you end up giving it away to your best customers.
______________________________________________________________________________

The Numbers
_____________________________________________________________________________

Let’s crunch a few numbers. Assume it costs $0.50/mo to support each user + $0.25 per check deposited + $20 per tech support call (I made these up so don’t quote me).

Free service:
Cost = 50,000 users x 0.67 checks/mo + 1,000 support calls per year = $420,000
Fee revenue = $0
Customer retention value = ??? (some positive number)
———————
Net = ($420,000)

Subscription service:
Cost = 5,000 x 4 checks/mo x 100 support calls per year = $92,000
Revenue = 5,000 x $2.95/mo = $177,000
Retention value = ??? (same as above)
——————–
Net = +$85,000

Change in net (delta) = $500,000
______________________________________________________________________________

Bottom line
__________________________________________________________________

With either approach you get to tout the benefits of the new innovation to capture the branding value. But under the subscription model, only those who really stand to benefit from the service use it, and you end up with a small profit or at least less of a loss. In the above example there is $500,000 gain compared to the free model.

Yes, this is over simplistic. Yes, you’ll take some grief for charging when others are giving it away. It’s possible you might even lose a few customers, but not $500,000 worth. And the biggest benefit of all, you can actually afford to create the new service now, instead of tabling it for five years until it becomes a competitive necessity.

Back to the original question. Honestly, I have no idea how to prove that innovation has a good ROI. What I do know is that for the past 100+ years, clever manufacturers have created billions in value by beating the competition with new products and services. I’m pretty sure financial companies will do the same with their online and mobile offerings.

———————————————–

Note:
1. See our current Online Banking Report, Creating Fee-Based Online & Mobile Banking Services.

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Cash is Still King at PayNearMe

By Julie Muhn (@julieschicktanz) Posted on June 2, 2011
Categories: PayNearMe

Imagine this scenario: You’d like to visit a friend who lives three hours out of town but

your car is in the shop so you need to take the train. To purchase the ticket ahead of time, you’d like to pay online or over the phone instead of at the Amtrak station. But here’s the kicker– you don’t have a credit or debit card. How are you supposed to buy the ticket if you can only pay with cash? The solution is easy, and it’s called PayNearMe.

Founded by Danny Shader in 2009, PayNearMe is a Mountain View, CA-based company that

enables consumers to buy online and pay offline at 7-Eleven stores.

Using this service, consumers can pay off loans with cash, purchase goods from other retailers, and even pay for services such as transportation. To get a better idea of more possibilities, see PayNearMe’s FinovateFall 2010 and FinovateSpring 2011 demos, both of which won Best of Show awards.

Why use PayNearMe?

You do not have a credit or debit card (24% of U.S. households)
You prefer to pay with cash (most teens and 54% of adults)
You do not want to divulge personal information online
You would like to repay a loan with cash

How it Works

Imagine you want to purchase a book that’s for sale online, but don’t have (or don’t want to use) a debit or credit card.

You can use PayNearMe to purchase the book online using an Amazon gift card. It’s a three-step process:

1) Complete the online form at the PayNearMe website.

Choose Merchants (step one in the visual below), select Amazon as the retailer (step two), and answer these questions:

Gift card amount
Email address
Zip code
Password

Then choose whether to pay with or without a printer. If going paperless, enter a mobile phone number and within seconds receive the following text message:

2) Go to 7-Eleven.

Use PayNearMe’s website to locate a nearby 7-Eleven store and, once inside, find the PayNearMe cards on the rack (see example at end of post). Following the instructions in the text message,

reply with the nine-digit code.

A follow-up message will appear seconds later:

You can pay the cashier with a $20 bill and ask her to load the money onto the card. After she swipes the card and processes the payment, she’ll hand you a receipt along with the card. You’ll then receive a final text message:

3) Use the claim code.

The receipt prompts you to visit www.amazon.com/gc and enter the claim code listed on the

receipt (see below). Login with your Amazon account, ensure the payment is loaded into the system, and click Apply to Your Account. The $20 is loaded into your account so you can find the book and pay for it with the $20 gift card balance.

Analysis

I like that this is a completely free service for consumers; $20 in your wallet translates into $20 in your Amazon account. There are no hidden fees or surcharges. In addition to this, the PayNearMe card is reusable so you don’t need to pick up a new one each time you use the service.

On the flipside, Amazon doesn’t offer PayNearMe as one of its default payment choices so you have to start the transaction through the PayNearMe website. While this is an additional step in the process, it still makes it easy to pay for goods and services using cash.

PayNearMe card and receipt

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Alumni News — Week of May 23, 2011

By Julie Muhn (@julieschicktanz) Posted on May 31, 2011
Categories: Aptys Solutions, Backbase, Betterment, Bill.com, Boku, Capital Access Network, Credit Karma, Doxo, Dwolla, edo Interactive, Expensify, Kabbage, Lending Club, LendingKarma, Lendio, Lodo Software, Monitise, Mortgagebot, PayDivvy, PayNearMe, peerTransfer, ProfitStars, Robot Dough, SecondMarket, Smarty Pig, Striata, ThreatMetrix, TILE Financial, TradeKing, Tyfone, Wikinvest, Wonga, Xero, Zecco, Zopa

Aptys Solutions
Aptys Solutions signed with Banker’s Bank, a top check depositor with the Federal Reserve Link

Backbase
Backbase to host webinar on how to use social media in financial services Link

Betterment

Betterment announced a growth of over $10M under management and over 4000 customers in first year Link
Betterment celebrated its first birthday Link

Bill.com
Bill.com is working to improve its mobile offering for small and midsized businesses Link

Boku
Mobile Entertainment explained how Boku will revolutionize pay-by-mobile for digital goods Link

Capital Access Network
CNBC explained how Capital Access Network solves the need to use financial creativity Link

Credit Karma
WiseBread Blog interviewed Credit Karma CEO Link

doxo

doxo’s first fan video was posted online Link
Oregon employees were the first to give its members doxo’s online file cabinet Link
TechFlash highlighted the benefits of using doxo to achieve paperless business Link
2Minute Finance interviewed doxo at FinovateSpring Link

Dwolla

Dwolla was listed by inc Tech as one of three startups you must know from Big Omaha Link
Credit Union Times listed Dwolla as a new P2P service rivaling ‘bank giants’ Link

edo Interactive
MyBankTracker interviewed edo Interactive COO about its Prewards service Link

Expensify
Slate explained how Expensify will help the ‘frequent flier’ Link

Kabbage
Technorati described how Kabbage works with eBay Link

Lending Club

Mint.com’s blog covered what you need to know about Lending Club Link
San Francisco Business Times commented on Lending Club’s strong backing from both investors and lenders Link
San Francisco Times reported that Lending Club stated it is not planning to go public for several years Link

LendingKarma
Entrepreneur featured LendingKarma as a good tool to use when borrowing money from family or friends Link

Lendio
San Francisco Chronicle reported that Lendio offers funding opportunities for new grads Link

Lodo Software
Lodo Software was described as a startup providing jobs in the “Silicon Prairie” region, a.k.a. Omaha Link

Monitise
Monitise released a report predicting that the majority of consumers will use mobile money services within the next three years Link

Mortgagebot
Mortgagebot reached 1000 clients, one of its goals from the beginning Link

PayDivvy
2MinuteFinanced interviewed PayDivvy about its services Link

PayNearMe
BillShrink examined PayNearMe’s cash payment service Link

peerTransfer
Mass High Tech interviewed Iker Marcaide from peerTransfer about becoming an entrepreneur Link

ProfitStars
ProfitStars announced a new version of Margin Maximizer that’s now available as a hosted solution Link

Robot Dough
2MiniuteFinance toured RobotDough’s demo during interview at Finovate Spring Link

SecondMarket

Wall Street Journal stated that SecondMarket helped fuel the tech boom Link
CNBC interviewed SecondMarket for an explanation of the change in trading numbers Link and Link

Smarty Pig
Smarty Pig launched new sharing features, including activity sharing and goal sharing Link

Striata
Striata will host a June 2 webinar for implementing successful ebilling strategies Link

ThreatMetrix
San Francisco Chronicle covered ThreatMetrix’s research around mobile transaction activity Link

TILE Financial
TILE Financial released a Financial Identity Profile to strengthen the connection between advisors and under-30 consumers Link

TradeKing
TradeKing divulged the lineup of its free webinars in June Link

Tyfone
Tyfone won 2010 Asia Pacific Smart Card Association Award for its NFC innovation and implementation Link

Wikinvest
Dow Jones Advisor highlighted Wikinvest as a way to analyze portfolios Link

Wonga

Wonga won 2011 Red Herring Top 100 Europe Award for exceptional accomplishments Link
Wonga won the Media Momentum Awards, a coveted award for digital media companies in Europe Link
Wonga’s Errol Damelin discussed consumer-centric credit Link

Xero

Diversity Limited commented on Xero’s move to the US markets Link
Xero and Keebo teamed up to help you manage and process receipts Link
New Zealand Herald commented on Xero’s surging revenue Link

Zecco

The Wall Street Journal reviewed Zecco’s new Facebook app Link
Zecco launched an app for stock trades & viewing realtime market data on Facebook Link

Zopa
Zopa shows how it helps consumers protect against inflation Link

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Launching: BillGuard’s “Anti-virus for Credit Cards”

By Jim Bruene Posted on May 26, 2011
Categories: Credit/Debit Cards, Launches, Personal Financial Management

Fintech made a good showing at TechCrunch’s semi-annual Disrupt conference in NYC. Of 32 startups that launched on stage, three were financial-related:

Spenz: A mobile PFM (Disrupt demo)
InvoiceASAP: A mobile invoicing app with accounting integration (Disrupt demo)
BillGuard: A transaction-monitoring service (Disrupt demo)

And both InvoiceASAP and BillGuard (discussed below) were selected to come back on the third day and compete, along with four other startups, for the top prize in front of an all-star panel of judges. The judges selected BillGuard runner-up behind GetAround, a clever peer-to-peer car rental service which wowed the crowd, also taking home the People’s Choice award. _____________________________________________________________________________

BillGuard overview
_____________________________________________________________________________

The TechCrunch judges and analysts went gaga over BillGuard. Everyone wanted to use the service, and most wanted to invest in the company.

However, the company recently landed a $3 million Series A round (February 2011), so they’ll have to wait. Investors include: Bessemer Venture Partners, Chris Dixon, Ron Conway, IA Ventures, Howard Lindzon and Yaron Galai. The Israeli company has 12 employees. The founders are Yaron Samid, CEO, and Raphael Ouzan, CTO.

Currently, BillGuard is free for the first card and can be upgraded to monitor an unlimited number of cards for $4/mo, a classic freemium model.

In the two days following the company’s Monday launch, users added 10,000 cards to the alerting service. In the initial scans, looking back through 30 days of transactions, the company identified potential nuisance charges on 20% of the cards analyzed. The flagged transactions ranged in value from $2 to $6,000 with the latter described as “fraud on a very wealthy person’s card.” ______________________________________________________________________________

How it works
_____________________________________________________________________________

1. Register at the site with just your email address and ZIP code

2. Enter your username and password for a credit card account into the Yodlee-powered aggregation engine

3. The past 30 days of transactions are immediately downloaded and analyzed for potentially fraudulent or unwanted charges (see screenshot 2)

4. Charges are color-coded by risk assessment (green = good, orange = review, red = flagged) (see screenshot 3). Much like anti-virus companies, BillGuard relies on its user base (crowdsourcing) to identify nuisance and fraudulent charges.

5. You can quickly call up the “reviewable” transactions and choose to mark them “good” or wait for more information on the merchant from BillGuard and its user base (screenshot _______________________________________________________________________________

Analysis
_______________________________________________________________________________

In my case, the service did not find any bad transactions in the 85 it reviewed from my primary business and personal credit cards. All seven marked “unsure” were fine. None were flagged red.

But according to the company, the average American loses $300 per year in unwanted charges, and I’m way over that. Just last year, I lost more than $1,000 because I had the wrong plan on my mobile phone. But that was a legitimate charge from an existing merchant of mine. BillGuard doesn’t guard against stupidity, yet, but it wouldn’t take a whole lot more intelligence to start flagging this type of out-of-bounds charge as well.

The potential for financial safeguard services is huge. Just look at the multi-billion credit-monitoring industry, or Mint.com for that matter which alerts users to bank fees and keeps a running total. The question isn’t whether consumers want this type of protection, certainly they do. The issue is whether anyone will take the time to set up the service, pay for it, and then take the time to monitor their accounts.

BillGuard knows that and is actively pursuing deals with large banks to package the service into online banking. In its Monday demo, the company said it was in talks with three top-ten banks (on Wednesday they said, “Make that 4”).

Distributing BillGuard would be a mixed blessing for banks. Earlier detection of fraud would be useful, but the labor involved in working through increased dispute resolution, especially false positives, would have to be factored in. But again, BillGuard understands the dilemma and is developing dispute-resolution capabilities that will SAVE issuers time and money.

I predict we’ll be seeing a lot more from this company so keep them on your radar. I know we will.

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1. Welcome screen after first download & scan (26 May 2011)

2. Initial scan results with 7 transactions marked “review”

3. Transactions are color-coded by risk assessment

4. The transaction review page

5. TechCrunch finalist demo (click to watch on TechCrunch site; )

—————————

Note: For more on online personal financial management (OFM/PFM), see our Online Banking Report.

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Spend Grow Give: TILE Financial’s New Learning Environment

By Julie Muhn (@julieschicktanz) Posted on May 25, 2011
Categories: TILE Financial

During FinovateSpring last week, I spent a lot of time talking with demoing companies about their new products and services. I was impressed by the overall utility of the products and the friendliness of the entrepreneurs. Over the next few months, I’ll be profiling a number of the companies that presented last week.

Amy Butte, former CFO of the New York Stock Exchange, founded NYC-based TILE Financial in 2008 with a goal to help financial institutions hold onto the $1.5 trillion in assets projected to be inherited during the next 10 to 15 years.

TILE seeks to help young adults establish a financial identity, learn to follow a budget, and understand financial terms and concepts. It’s also meant to facilitate a dialogue with their parents, grandparents or other funder, and their financial advisor.

Through TILE’s Spend Grow Give interface, the topics of money and finance are expected to transition from taboo to comfortable subjects. The unique user-interface is very visual, perfect for the target audience of 15 to 25-year-olds.

How it works

Homepage:

Account Overview
After logging in, I see an overview of my account divided into three categories:

Each contains a pie chart of my spending, investments and charitable contributions. Please note that the Grow category is empty because I am using a test account without investments.

Reference Bar
Pictured below, this feature has eight tabs and is located at the bottom of the user interface (see homepage screenshot at end of post). My favorite tab is TILEcasts, a unique reference tool that contains video clips of experts talking about subjects such as, “Here’s Why You Need Insurance.” The clips break down complex financial issues into bite-sized pieces with digestible language.

Alerts
The interface includes customized alerts such as portfolio changes, budget limit approaches, and so on. Alerts are delivered via the TILE site, email, or text message.

Profile Page:

My Profile
At first glance, the profile appears similar to Facebook. I can upload my picture, update my status, and share with the TILE community, my financial advisor, my funder (i.e., parent/grandparent), Twitter, or Facebook.

Features
The main part of the profile page is My Financial Identity, which features the homepage categories: Spending, Growing, and Giving, as detailed below. Each contains quizzes and tutorials that allow the user to understand what money means to them. TILE refers to this as a person’s “financial identity.”

– Spending

Here, I can see how well I know my budget. I take a quiz to test my knowledge of how much I spend on certain categories and am guided through a tutorial to help adjust

monthly spending habits. Another lesson teaches the basics of establishing credit.

– Growing

In this section I can learn when to start investing, how to time financial

markets, and take a risk profile assessment. There is an easy-to-use calculator that inputs age, investment

amount, and interest (see graph on the right) to show growth over time.

– Giving

This area features a quiz to help me discover causes I really care about and would allocate charitable giving to. It requires much thought and in the end helped me create my own mission statement.

My user experience documented here covers only a small section of what is available in TILE’s Spend Grow Give product. To see it in action, stay tuned to www.finovate.com to check out TILE’s demo that will be posted in the next few weeks.

Homepage View

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New Online Banking Report Published: Creating Fee-Based Online & Mobile Banking Services

By Jim Bruene Posted on May 23, 2011
Categories: Online Banking Report, Pricing

The scariest thing about being a banking industry analyst, besides boring your family & friends, is looking back at the advice you handed out 5, 10 or even 15 years ago. While I’ve had my share of hits and misses, one thing I’ve been particularly adamant about, is the need to create fee-based online financial services. Sadly, this is one that’s been completely ignored so far (see note 1).

If U.S. financial institutions had charged an average of $1 per month per user (note 2) over the past decade, it would have generated $10+ billion in incremental profits, much of which would have been reinvested into the channel.

Had that happened, we’d already have:

Ironclad security
Highly personalized 2-way alerts & messaging
Integrated PFM and credit monitoring
Responsive online/email customer service
Killer mobile banking and iPad apps
And much more

But what matters now is where do we go from here? Consumers have been trained to expect everything, even costly services such as online billpay, to be free of charge. Anyone who tries to charge fees for the existing state of the art risks massive backlash from customers and the media.

The way to introduce fees after the fact is to charge only for new value-added services such as those listed above. That way, no one pays fees unless they want the new benefit. It’s the classic freemium model, and it works well across a number of industries, just ask LinkedIn.

Our latest report lays out 33 value-added modules that could support a la carte subscription fees. We look at eight use cases where these modules are bundled together for various-high value segments:

Power mobile users
Road warriors
Families/parents
Small/micro business
Homeowners
Financial trackers
Empty nest/retirees
VIPs

Currently, the best examples of multi-tiered pricing in the United States is business online banking where a number of banks and credit unions have a basic free option and at least one higher-end “cash management” solution (see Western Bank screenshot below).

______________________________________________________________

About the report
______________________________________________________________

Creating Fee-Based Online & Mobile Banking Services (link)
Pricing 2.0: How new revenue models will propel online/mobile banking to the next level

Published: May 18, 2011

Author: Jim Bruene, Editor & Founder, Online Banking Report

Length: 44 pages (10,000 words), 17 Tables

Cost: No extra charge for OBR subscribers, $395 for everyone else (link)

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Western Bank’s online banking pricing matrix (link, 15 May 2011)

————————–

Notes:
1. At least in North America. Financial companies in other areas of the world have been more successful with fee-based services.
2. This is an average amount. Most users would pay zero, but with 20% paying $5/mo, you get to the $1/mo average.

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Alumni News — Week of May 16, 2011

By Julie Muhn (@julieschicktanz) Posted on May 20, 2011
Categories: Alumni News, Bill.com, BrightScope, ClairMail, eRollover, Finantix, Intuit, iPay Technologies, Kapitall, Kashoo, On Deck Capital, Outright.com, SecondMarket, TradeKing, Wonga

Bill.com

Practical Ecommerce listed Bill.com as 1 of 19 tools for online bookkeeping and invoicing Link

BrightScope

BrightScope announced the top 10 commodities funds held in America’s 401k plans Link

Frazier & Deeter, FD Alliance, BrightScope and SignatureFD conducted a national webinar on BrightScope’s tool that rates employee benefit plans. Link

ClairMail

ClairMail reported record growth with a record number of customer acquisitions and a 300% increase in user growth Link

eRollover

eRollover announced its Facebook Early Retirement Vacation Sweepstakes Link

Finantix

Wealth Management 360 highlighted Finantix’s Finovate Europe demo Link

Intuit

Intuit reported an increase of internet banking users by 9% and bill pay users by 23% Link

iPay Technologies

iPay Technologies reached 1 Million users of its P2P electronic payment service, with almost 8 million payments processed to date Link

Kapitall

Kapitall implemented an alert system for current news on stocks and funds. These new alerts will keep users informed and will link directly to Kapitall’s analytical tools for a quick understanding of changes. Link

Kashoo

Practical Ecommerce listed Kashoo as 1 of 19 tools for online bookkeeping and invoicing Link

Kashoo was selected by IDC as one of Canada’s Top 10 cloud companies to watch Link

On Deck Capital

Tech Crunch reported On Deck Capital’s announcement of the On Deck Score, a credit score for small businesses. This program seeks to fix the problem of businesses borrowing money as consumers http://tcrn.ch/kNjGX6 Link

Outright.com

Practical Ecommerce listed Outright.com as 1 of 19 tools for online bookkeeping and invoicing Link

SecondMarket

SecondMarket experienced $115M in private stock sales during Q1 Link

TradeKing

TradeKing ranked number four in customer service for the second consecutive year in the Annual Broker Survey by Wall Street Journal’s magazine, SmartMoney Link

Wonga

Wired UK mag covered Wonga’s disruptive process of making borrowing money completely automatic. Are they transforming personal finance? Link

Wonga should have won of Startup 100 Awards, not Spotify Link

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FinovateFall: Last Chance to Save $300 on Sep. 20-21 Event

By Julie Muhn (@julieschicktanz) Posted on May 19, 2011
Categories: FinovateFall 2011

Thanks to everyone who made FinovateSpring a success just a week ago (my Twitter transcript here). But innovation doesn’t stand still, so we are already collecting applications and selling tickets for FinovateFall in New York City.

In fact, if you want to save on your fall ticket, register by the end of the day Friday (May 20) to receive $300 off regular ticket prices. Based on early results, it could be the biggest Finovate yet.

Last year, the conference expanded to two days (selling out 3 weeks in advance) and the audience loved it. Once again, each day will be packed with our unique blend of short, fast-paced onstage demos (no slides allowed) and intimate networking time with top executives from the demoing companies. With each company receiving just 7 minutes onstage, FinovateFall is the only place to see dozens of fintech innovations in such a short period of time.

So make sure you are part of the excitement at the fifth annual NYC Finovate on Sep. 20 & 21, and save $300, by registering today!

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Last year’s presenters (FinovateFall 2010)

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FinovateFall: Last Chance to Save $300 on Sep. 20-21 Event

By Jim Bruene Posted on May 18, 2011
Categories: FinovateFall2011

Last year, the conference expanded to two days (selling out three weeks in advance) and the audience loved it. Once again, each day will be packed with our unique blend of short, fast-paced onstage demos (no slides allowed) and intimate networking time with top executives from the demoing companies. With each company receiving just seven minutes onstage, FinovateFall is the only place to see dozens of fintech innovations in such a short period of time.

So make sure you are part of the excitement at the fifth annual NYC Finovate on Sep. 20 & 21, and save $300, by registering today!

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Last year’s presenters (FinovateFall 2010)

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Zong: A Payments Company Name to Remember

By Jim Bruene Posted on May 17, 2011
Categories: Facebook, Mobile Payments

Editor’s note: This guest post was written by Daniel Thomas, a 25-year veteran of the financial services industry and a principal consultant with Mindful Insights LLC. He’s been involved in strategy and product development for Online Resources Corporation, ARINC, and TeleCheck. He recently authored a report on merchant-funded in-statement rewards for Online Banking Report.

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Admittedly, my online game prowess is more closely aligned with Pong and Donkey Kong than the latest complex and socially intricate diversions. Back in the day, computer games garnered only a single payment transaction: when it was actually purchased. But today, in order to reach the next level, buy virtual pets or beat your opponent a half a world away, a player/avatar/consumer will typically transact multiple times per month in order to buy Facebook credits or other virtual currency (cash, coins, gems, etc.).

These transactions can often occur in the heat of battle (literally), and the last thing any good soldier wants to do is stop progress in order to begin the seemingly weeklong process of taking out their credit card and typing a bunch of numbers just to spend a $2.99 to re-fill their weapons cache.

Before you could say billabong, along came Zong to make it as quick and as easy as a song. How? They ask if you want the charge to tag along on your mobile phone bill. And before long, you are back in action and that much stronger.

So, what’s the big deal? What has tickled my lifelong fascination with payments is not where Zong is now but where they are headed. Keep in mind that all these newfound payment transactions are seen only by the game company (merchant);, Zong (acquirer and network); and the mobile phone company (issuer). Financial institutions are involved only when the phone bill is paid at the end of the month.

Furthermore, the fees that Zong and a throng of other “carrier billing” processors command can be as high as 40% of the transaction amount. Ding-dong! Hello? After all, the cost of goods sold for a new virtual tank is pretty small and so is the actual transaction amount once the price has been converted from the game company’s internal currency.

But even so, 40% ain’t chicken singsong, especially when you consider that the online gaming (not gambling) market today is along the lines of $100 billion. Admittedly, 90% of that market belongs to the non-virtual console and PC games that Zong will be moving into as those products enter headlong into the virtual world.

Future plans
Zong, which now has 100 employees, is already available as a form of payment for Facebook Credits and virtual goods in 42 countries. The company has big plans to expand with its model. Online gaming is just phase one of its multi-prong strategy. Zong knows that moving into markets where physical and digital goods are purchased online (phase 2) will require a reduction in the processing fee percentage. But they already have millions of loyal consumers enrolled in their service which they can leverage to expand to merchants selling relatively low-priced products with reasonable margins (think: books, music, etc.)

Phase three takes things one step further as Zong’s strategy intersects with mobile payments at the physical point-of-sale. The idea is that consumers will use the Internet to research their next purchase, as they do today, and will buy the item online using Zong to place the charge on their mobile phone bill. That payment information is then stored in the cloud so that their customers can go to the physical store, pick up the item and show proof of purchase to the merchant.

That should keep traditional payment providers awake all summer long.

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Purchasing Facebook credits with Zong

Step 1: Choose number of credits

Step 2: Enter mobile number

Step 3: Random 4-digit authorization PIN is sent via Text message

Step 4: The PIN is entered into Facebook

Final confirmation screen

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Finovate Spring 2011 Live Twitter Transcript

By Julie Muhn (@julieschicktanz) Posted on May 17, 2011
Categories: FinovateSpring 2011

Here’s the transcript from our Netbanker live Twitter feed during Finovate Spring last Tuesday and Wednesday.

The entries are in reverse chronological order.

PayNearMe also demoing multiple bill payment at 7-eleven and finally international remittance via Ria; great role play on stage!

PayNearMe demoing three obligations paid via a cash transaction at the 7-eleven store; first a Progreso Financiero payday loan pmt

Corduro demoing a use-case where a non-profit can take donations/payments on-the-go; launching today MobilizeYourArmy.com

Corduro “Square meets Paypal meets your wallet” mobile payments solution

Launching OpenCuro network today, so that the codes can be generated from within a bank’s secure site

OpenCuro launching new online payment system with increased privacy & security; uses one-time random alpha-numeric code

Ideon also launching system for FI to create new value-added CDs, speeds time-to-market “minutes, not months”

Ideon launching Choice Savings, a certificate of deposit sales system where user can create a customized deposit product

MyBankTracker.com, with 500,000 unique visitors/mo, launching Plentifi, an app to mobilize the PF community; includes real-time Q&A

Aptys showing a mobile billing system, with invoice creation and payment by check with remote image capture through iPad2 camera

Aptys Solutions, a FI payments hub, launching “aMobile” mobile payments capabilities

Enloop demoing a biz owner setting up the financials for proposed business; assigns EPS performance score; creates biz plan

Enloop launching beta today; allows anyone to complete online business plan & have it scored with algorithms that predict success

edo Interactive showing how fast reward is redeemed; user has money in their bank account within a minute

edo Interactive demoing co-brand with Fifth Third Bank which is now live for its 4.5 million customers

edo Interactive launching Prewards: merchant-funded rewards with real-time redemption and immediate notification

payDivvy launching to the public today

payDivvy can be used to share and divide recurring bills among roommates; has a built in “ping” function to remind roommate to pay

payDivvy launching publicly today the first social billpay system, ie. bill sharing, a “missing function in today’s systems”

Kony demoing its mobile-web app, that behaves the same as native app; and first Blackberry app of the day

Kony Solutions, used by 40 global customers, showing a customized mobile app with remote deposit capture

ChargeSmart currently processing $111/min across all payment methods

ChargeSmart offers a percentage (up to 92%) of gift card balance which customer can accept/reject; then apply to bills

ChargeSmart partnering with PlasticJungle to launch system to turn unused gift cards into currency to use to pay monthly bills

Adobe user interface very sophisticated, both online, mobile phone and tablet (i’m ready for my bank app to look like that)

Adobe showing online cross-selling platform with slick Facebook/Twitter integration

Openfinance working today with 60 European financial institutions

Openfinance showing customization of “Open workplace” with plug-and-play modules; includes mobile and iPad version of dashboard

Openfinance from Spain launching an advisor platform to better counsel clients online

Expensify launched mobile photo receipt capture to make it easier to upload expenses into the system, “a most requested feature”

Expensify working on holy grail, “one-click expense reporting”, demoing auto reconcile, auto categorization, showing biz card scan

Expensify hits the stage running, “expense reports that don’t suck,” great start to final afternoon

BancVue beta clients delivering to 100 schools, 10,000 students; showing how it is used to increase sales, build relationships

BancVue MoneyIsland includes “teacher and parents dashboard” to track students’ progress, also can link to offline curriculum

BancVue launching youth-oriented financial gaming system, Money Island, a financial education platform

Tile Financial “young adults engage with images, not spreadsheets” so interface very visual oriented; live with FI & 2 more coming

Tile Financial, a financial mgmt program for Gen Y, launching Financial Identity, the money version of a social network profile

PrivatBank’s Liqpay launching PaytoFace, a peer-to-peer system for paying Facebook friends by clicking on their profile pic

Currensee launching today the “Portfolio Builder”, with dynamic update of total risk in portfolio

Currensee includes social piece, where you can follow and invest with the actual trades by top-performing network members

Currensee has invented “new way to invest” in world currency market; targeted for retail investors ($4 tril per day in volume)

eWise demoing mobile purchase at the point of sale, also mobile bill payment by scanning QR code with mobile camera

eWise walking thru online purchase via US Bank, user needn’t pre-register, automatically available when bank joins network

eWise onstage with U.S. Bank demoing Payo, Secure Vault Payments, online in production @ US Bank & will be piloting mobile in 2011

BillShrink demoing private-branded (Chase) mobile version to find and track rewards; “geo-enhanced” of course

BillShrink launching “reward discovery”; how user behavior incented to unlock additional rewards, eg. spend “X” more get, Y bonus

BillShrink launching Statement Rewards Mobile; announcing 4 innovations today; showing rewards on a Chase bank statement

RobotDough also includes 15,000 defunct companies to eliminate “survivor bias” from back testing; can browse investing strategies

RobotDough launching worldwide coverage to ALL 45,000 global public companies; w/ 20 years historical data for powerful back tester

RobotDough launching investor tools, drag-and-drop visual screener; uses powerful natural-language search queries

Q2eBanking launching fraud monitoring, and fraud reduction, solution for community banks and credit unions

Discover Money Messenger a
lso works online, new tab in Discover site, “Send Money” and says “powered by PayPal” on top of page

Any Discover cardholder can now send money via mobile to other cardholders or to any mobile number; demoing live on stage, worked!

Paypal and Discover launching Money Messenger using Paypal’s X open payment platform

Bills.com debt coaching service is free to consumers; integrates with DebtGoal

Bills.com shows costs and APRs for every open credit line; and helps figure savings, eg. from a mortgage refi

Bills.com demoing Debt Coach to help consumers manage & minimize debt; integrates ACTUAL INFO from Experian credit report

GoalMine reminds of goals, “weight watchers for money” and moves money to invest accts; also only way to invest via Facebook”

GoalMine allows users to set “pledges”,eg “stop buying lattes,” then with geo, when walking in Starbucks reminds not to buy

GoalMine launching mobile system for easy “retail” investing; making investing “as easy as updating twitter/facebook feed”

Silver Tail dashboard has column with “user skew”, rates each click’s deviation from expected behavior, red flag for oddities

Silver Tail Systems launching new behavioral monitoring on individual mobile/online clickstream

In addition to credit bureaus, TrustedID monitors black market to see if card stolen; also upsells to choice of 15 paid versions

TrustedID launching free ID theft protection service, ID Safe; “free for life” no credit card needed; only distributed via partners

HelloWallet has a secondary navigation category, “Reduce Spending” with item count, good approach; showing examples

HelloWallet has been distributed through employers as employee benefit, but today are opening up to the general public

HelloWallet positioning as online “wealth building service” to differentiate against other PFMs

Wipro mobile also includes expense-claim module, employee time-sheet input, payroll, etc; very comprehensive

Wipro showing easy mobile positive pay system, an important feature for businesses and even consumers who crave extra control

Wipro demoing new mobile solution for small/mid-size business management

Mitek Systems showing the photo capture of a bill, then OCR conversion captures payee name & payment amount

Mitek, which made its name in mobile check deposit, introducing “mobile photo billpay, to pay bills directly with camera phone

Interesting to see “override” (the credit decision) button in the Experian dashboard, looks easy to navigate

Experian Business Information Systems launching Business IQ Premier, an interface for managing credit decisioning

FreeMonee launching today at Finovate, first national gift (card) network delivered; distribution is through banks for trust & convenience

Day 2 at Finovate starts with FreeMonee by giving out some $25 Best Buy and Nordstrom gift cards to audience, benefit of sitting up front!

That’s a wrap for day 1; turn in those Best of Show ballots for free Starbucks card, see you tomorrow

Backbase showing how banks can customize end-user experience by adding new apps in near-real time; Strands included in app store.

Backbase launching Backbase App Store for online, mobile, and tablet apps

LendStreet is “P2P lending meets credit counseling” and captures discounts lenders offer to get bad debt off their books

LendStreet launches system to help consumers restructure debt with retail investors funding; specialized P2P lending niche

Balance Financial also launching iPhone app with image capture to upload picture of bills to personal bookkeeper

Balance Financial looks at bills received & determines whether to pay automatically or flag for further review; fee-based service

Balance Financial launches alternative to DIY financial management using algorithms, tech & nationwide network of human bookkeepers

ID Analytics demoing mobile integration; cool dashboard with patented ID score on green/yellow/red dial; protect 2 mil users now

ID Analytics, “minutes count with ID theft,” leveraging cross-industry ID network to instantly alert consumers when theft occurs

oFlows demoing customer loan app on iPad with signature; using iPad2 camera to upload photos of two forms of ID for compliance

oFlows takes the paper out of paperwork; launching new process which mobilizes the entire product application process

Lendio does a soft-pull from Equifax so there’s no hit to credit score while the biz is loan shopping

Lendio assists the small business lending process by matching qualified prospects with lenders who could reasonably approve loan

Bankons using “Bruene C.U.” in its mobile mockup (gotta love that) and a 2-for-1 offer at Skool after the show.

BankOns using Yodlee data aggregation; offers white-labeled turn-key or use of API to integrate directly into FI’s mobile app

BankOns launching today; delivering through the FI geo-located merchant offers, mobile optimized, android and iphone

Dwolla has 10 financial institutions signed, using FiSync; showing dashboard that shows where users are transacting

Dwolla is demoing its person-to-person payment app; side note: our 2nd Finovate alum from Iowa (also @smartypig)

Figlo demoing investment tools; today launching iPad app and Android app

Figlo showing its dashboard, advanced online PFM user interface; launching multi-currency

Braintree helped LivingSocial sell 1.3 million Amazon gift cards in 24 hours and stay PCI compliant

Braintree providing LivingSocial with credit card acceptance using “transparent redirect API ” to offload risk /compliance

Kiboo mobile has goals, funds transfer, product discovery with geo-location, NFC-enabled POS purchase, social network integration

Kiboo launching mobile app companion to the online youth-oriented banking platform

Ready Receipts allows users to upload receipts or, with merchant participation, get paperless receipt at POS and opt out of paper

Ready Receipts launching system to get rid of paper receipts; showing receipt dashboard

See Afiniate in the hall this afternoon; I’m sure their iphone will connect the minute they step off stage

Affiniate launching on-the-go financial coach to turn mobile app into customer’s personal financial advisor

Mint.com launching mobile advice, alerts when available credit gets too low; some advertisers get more leads by mobile than online

Mint.com says 50% of users have smartphone attached to acct; 20-25% of new users coming via mobile app and using mobile only

Bill.com charging $0.49 fee for invoices paid via electronic payment; something businesses will like

Bill.com launching mobile version for biz owner to handle/approve bills, make payments and handle receivables

Bill.com showing online invoicing system for small businesses; moving $2.5 billion in bill payments annually

Showing peerTransfer
in use at Boston-based Suffolk University; novel use of peer-to-peer services

peerTransfer launching p2p international money transfer service; currently offering for tuition payments for intl students

Wikinvest taking signups for beta users of SigFig

Wikinvest launching SigFig; helps users analyze trading fees & commissions they are paying; compares to peers and other providers

BillFloat showing easy to understand disclosure on complete cost of short-term loan; merchant can offer fee discount

BillFloat system for helping users get individual bills paid, introducing “Less is More” to help users get correct size loan

Profitstarts also allows line-level employees to make individual pricing decisions in the same tool

Jack Henry’s ProfitStars introducing Margin Maximizer Interactive, a system to help FIs make better pricing decisions

Billeo ShopSmart includes option to show Groupon and other daily deals into the interface; working with 2 of top 5 card issuers

Billeo has seen conversions as high as 8% on offers; includes integration to Facebook to share product info

Billeo launching integration of merchant offers into mobile search results; demoing slick integration on iPad

Arroweye can be integrated into secure online banking; choose from clipart or upload own image and resize to fit card exactly

Arroweye Solutions is launching a highly-customized online digital design platform for debit/credit/prepaid cards

Doxo showing for first time the business control panel, dashboard for talking with customers, as easy as tweeting or Facebooking

When billers are connected to user via doxo they can communicate billing info and other account info right through doxo

Doxo solving paper statement problem, only 15% paperless; “why isn’t interacting w/ billers as easy as talking to friend @Facebook

HOYOS selling USB device for $99, not a hurdle for business users and high net worth

HOYOS is showing actual live login with eye scan to Twitter, Gmail, Paypal and Facebook and they all worked!

HOYOS launching EyeLock, a biometric system to login to any of your online accounts with iris scan via USB device

Bancbox showing acct opening; integration with LoanBack (p2p loan platform); includes reporting, reg compliance, educational tools

Note to self: copy that cool spotlight Bancbox is using to highlight features on screen

BancBox launching “API to US banking system” (awesome opening line) so fintech startups can quickly offer bank & pay services

Code Green showing how FI clients can customize how their rates look; showing results via Virginia Credit Union mockup

Code Green launching Ratecast to help FIs get their rate info into the market, showing integration with Facebook

Kabbage is launching today their support for Amazon merchants in addition to eBay

Kabbage, which funds online merchants, launching system that rewards them (w/ more capital) for adding more data to Kabbage acct

Gold Bullion showing dashboard: buy & choose where metal is stored. Fully audited & insured; integrate with other asset mgmt systems

Gold Bullion International showing online precious metals trading platform; makes buying the metals as easy as buying securities

Xero showing simple report generation via drop-down boxes, makes it easy create and share reports; showing NZ accountant search

Xero out of New Zealand is showing its online accounting dashboard with business indicators to help manage

Intellaegis tools save 1 hour /day per employee plus increases their effectiveness; Findex score = how easy to find person

Intellaegis demoing MasterQueue dashboard which gathers public data on loan holder incl. social networks; develops Findex score

Intellaegis launching system to better manage massive data gathered for loan collections

Bundle’s merchant tool shows average ticket value to see how expensive, showing example from Ozumo in SF; also discovery tools

Bundle is demoing new merchant recommender so users can see where others are spending their $$; calculates loyalty score

Clovr Patch is the consumer UI for tracking offers and redemption; good web 2.0 look and feel; also links offers to mobile

Clovr Media (Card Linked Offers Virtual Redemption) starts Finovate off with huge new opportunity, merchant-funded rewards systems

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