PocketSmith: Take control of your personal finances
The standard New Zealand startup playbook goes something like this:
- Come up with a great idea to solve a problem whose market pain you have experienced personally
- Form a team of cofounders
- Build a Minimum Viable Product (MVP)
- Get initial traction
- Raise investment
- Go global
- Exit
Most investors I talk to hope that the entire process will complete, from go to whoa, in five to seven years.
PocketSmith, a great startup out of Dunedin, formed in 2008, got to step 4 (initial traction), and decided that the global market for personal finance wasn't really ready for their product. So they're waiting for the stars to align, and meanwhile will surpass NZD 1m in annual recurring revenue (ARR) this year, without having spent any money on marketing. The vast bulk of their 110,000+ users are are in 200 countries, with the majority in the US, then Australia and the UK, then NZ, and they're growing at about 8% per month. They're biding their time, waiting for the optimum moment to strike. They know that if they went as big as possible as fast as possible, they would have missed the boat. It's all about timing, and that time is now.
PocketSmith answers basic questions about your personal finances: What's my net worth? How does my power bill vary over the course of a year? What would happen if I trimmed my entertainment budget by $100 per month? How do I manage accounts in multiple currencies? This is all done with a very slick, easy to use interface, which automagically pulls data from your bank and credit card accounts, and cleverly classifies your transactions with not much intervention.
Cofounder Jason Leong says the product is centered on your relationship to your money. "For most people, budgeting is right up there with dieting and going to the gym – we want to make it fun and interesting to be in control of your finances. Our overriding goal is for people to have a better relationship with their money.
According to Jason, the product is just where it needs to be now, and so they're starting a big international marketing push. They've hired a Growth Manager – Bridie O'Leary – to increase signups and conversions to the paid product, and are establishing a formal presence in North America through an agency. 2016 will be PocketSmith's year. Co-founder James Wigglesworth spearheads a development team that continues to refine and innovate upon the core software.
Although they took in a small investment a couple of years ago from Lance Wiggs, they have yet to spend it; their strategy is to continue to fund growth out of cash flow. Lance loves their capital efficient parsimonious approach.
Jason believes that Pocketsmith is well placed to become the centrepiece in a personal finance ecosystem. Just imagine what you could do with an automation layer on top of your inflexible online banking access. Think IFTTT or Zapier for your money. They already have a developer API going – they invite you to give it a shot. As PocketSmith becomes the platform for personal finance, they are aiming to become a $100m+ company in the next few years.
I've watched these guys with interest since their humble beginnings, and I like what they've achieved. I use PocketSmith myself for my personal finances, and would recommend that anyone concerned about how they're spending their money give them a go.
You can sign up for free at: https://my.pocketsmith.com/plans
