Finnest is one of the many FinTech companies to be accepted into the MassChallenge 2017 cohort. However, a big differentiator from other FinTech startups is the company’s mission: teaching children to learn more about managing finances.
Co-Founder and CEO Clemens Grave was born and raised in Austria, where he grew up in a culture where he learned how to handle money as a child. This was a completely different experience from Co-Founder Richard McDonald, who grew up in the US.
“At six years old I was given my first debit card,” Grave said. “In Austria, they introduce the concept of handling money when we are children. When I came over here [to America], I started to notice cultural differences in how Americans handle money. When I met Richard, he told me he got his first card in college.”
Grave met McDonald while they were attending Brown University, and they both connected through their interest in finances, particularly the stock market. The two were part of PRIME: Program in Innovation Management and Entrepreneurship at the university, a year-long master’s degree program.
Initially, the two wanted to build a mobile bank for children, but it soon spun out into something different. After learning more about the industry, especially in regards to how banking information is shared among bank clients, Grave and McDonald decided to leverage the technology and service of prepaid cards.
“Prepaid cards have a bad reputation, but the technology is great,” said the CEO. “Richard and I found that there are more options to control the money flow with prepaid cards.”
In the fall of 2016, Finnest was founded. The company’s technology utilizes prepaid cards and a smartphone application. Parents can load up the card through the app and they will be able to keep track of where the kids are spending their money.
Limits can also be placed on certain areas of spending, such as food/entertainment/etc. The idea of this feature is for children to learn how to save money.
“Kids are always stuck with cash,” Grave said. “We want to be able to give kids their freedom with their allowances. The technology will hopefully bridge the disconnect between kids and parents.”
For parents concerned with their children shopping through independent retailers, the cards do have a layer of security. The funds are also protected by the FDIC.
The biggest challenge the two entrepreneurs faced was in the development of the application itself. The two experimented with hiring freelance developers for the UX and UI, but found it to be frustrating.
“When you have this idea in your head and know what you want to see, it can be difficult to translate that to a developer who has a completely different vision,” the CEO said. “I actually started to learn how to use Photoshop and how to wireframe a website.”
Despite those early struggles, Grave and McDonald were able to round out their team with a designer and two software engineers. The duo was able to design a user-friendly application for the parents who aren’t too tech savvy.
The MassChallenge program accepts startups from all over the country and world, Finnest comes from the burgeoning Rhode Island tech scene. Prior to coming up to Boston, Finnest was part of SE Greenhouse in Providence, where they had the distinction of being the only FinTech company in the accelerator.
“SE Greenhouse is a social impact accelerator devoted to startups looking to make changes,” Grave said. “While we were there, we were building up our own advisory board.”
At a young age, Grave learned that teaching children how to manage their finances can prove to be helpful. If he’s right, Finnest could be the key to assisting parents with these skills.