58% of Gen Z customers present a desire for debit playing cards over bank cards, indicating a pattern towards avoiding potential debt accumulation. Nevertheless, usually, debit card utilization doesn’t contribute to credit score constructing since such transactions should not reported to credit score bureaus. Enter Fizz, a monetary literacy platform coupled with a debit card, designed for school college students. It requires no prior credit score historical past, cosigners, or safety deposits. The platform incorporates AI-powered budgeting instruments that tailor spending limits and presents customized suggestions, alongside gamified academic programs. Distinctive to Fizz, it reviews to credit score bureaus, enabling college students to ascertain a credit score historical past and in addition keep away from conventional bank cards. Moreover, it options an intensive rewards program. At present, Fizz is operational in over 300 faculties and is projected to surpass 9 figures in annual card quantity this yr.
AlleyWatch caught up with Fizz COO and Cofounder Scott Smith to be taught extra concerning the enterprise, the corporate’s strategic plans, latest spherical of funding, and far, rather more…
Who had been your traders and the way a lot did you increase?
We raised a $14.4M seed spherical led by Kleiner Perkins, with participation from SV Angel, Y-Combinator, New Period Ventures, and the founders and operators behind many family identify unicorns, like Postmates, Handshake, Public.com, and Airbnb.
Inform us concerning the services or products that Fizz presents.
Fizz makes a monetary literacy and budgeting app for school college students, and a debit card that builds credit score. With Fizz, college students get a holistic residence for all issues monetary adulting, from constructing credit score historical past and monitoring their rating, to AI financial savings suggestions, a budgeting toolkit, and game-like monetary literacy programs.
What impressed the beginning of Fizz?
Carlo (cofounder) and I confronted the difficulties of economic adulting, lack of economic literacy, and constructing credit score historical past head on. As a freshman at Harvard, Carlo couldn’t get accepted for a bank card, and couldn’t begin constructing credit score historical past. Just a few states away at Cornell, I noticed that even my smartest buddies weren’t nicely knowledgeable about their funds, and didn’t have good cash habits. We each dropped out to create Fizz and develop the merchandise that we and our buddies desperately wanted in class.
How is Fizz completely different?
What units Fizz aside is that we create monetary merchandise completely for school college students and younger adults. This group is missed as a result of they usually don’t but have credit score scores, or regular earnings streams, however that doesn’t imply they don’t want options that may present shopper and enterprise worth. By focusing solely on 18-24 yr olds, we will construct tailor-made options that tackle their distinctive wants, unlocking vital untapped potential, and driving immense worth for customers.
What market does Fizz goal and the way huge is it?
Fizz targets school college students (>20M of them within the US, with 5M freshmen coming into every fall), and younger adults. Fizz is focusing on probably the most beneficial and excessive LTV phase in shopper finance and retail banking.
What’s your online business mannequin?
Fizz makes cash primarily from subscriptions, interchange charges, and affiliate partnerships.
How are you making ready for a possible financial slowdown?
Fizz constructed and owns practically all of its personal ironclad software program infrastructure, driving vital value synergies and permitting it to broaden throughout the vertical quicker.
What was the funding course of like?
Fizz ran a traditional fundraising course of bi-coastally, courting traders in New York, and in Silicon Valley. We took 95% of Fizz’s fundraising conferences in individual.
What are the most important challenges that you just confronted whereas elevating capital?
Demonstrating that there’s nonetheless immense and sturdy worth in shopper and in fintech, unbiased of market cyclicality.
What components about your online business led your traders to put in writing the examine?
Distinctive penetration into a really beneficial phase with one of many quickest monetary merchandise and platforms to realize adoption amongst school college students since Venmo.
What are the milestones you intend to realize within the subsequent six months?
Deliver Fizz to much more faculties and universities, and turn out to be the go-to monetary useful resource for the incoming class of 2028.
What recommendation are you able to supply corporations in New York that would not have a contemporary injection of capital within the financial institution?
Staying lean and speaking to your customers isn’t essentially as trite because it might sound. Fizz constructed its infrastructure with an extremely small crew, and with much less cash than the subsequent closest competitor. Speaking to customers obsessively will help you identify the place the enterprise can drive near-term money flows in generally extremely shocking or surprising methods. This goes for each B2B and shopper.
Staying lean and speaking to your customers isn’t essentially as trite because it might sound. Fizz constructed its infrastructure with an extremely small crew, and with much less cash than the subsequent closest competitor. Speaking to customers obsessively will help you identify the place the enterprise can drive near-term money flows in generally extremely shocking or surprising methods. This goes for each B2B and shopper.
The place do you see the corporate going now over the near-term?
Fizz has a really bold product roadmap and is presently sprinting to launch two extra merchandise earlier than the 2024 fall back-to-school season.
What’s your favourite summer time vacation spot in and across the metropolis?
Prospect Park is nice for summer time weekends, and there’s nothing higher than a summer time workday in Soho, the place practically 90% of Fizz’s crew works in individual.
