Editor’s note: Zogo Finance, which is building a mobile banking app between parents and teens, came away with $300,000 in backing from the Startup Summit Shark Tank competition last week. Here’s a profile of the company.
DURHAM – Back in 2013, Bolun Li was a high school foreign exchange student from China living in Boston, Massachusetts.
To cover his expenses, his parents gave him a credit card – much to their detriment.
“I remember by the end of the month my parents would show me the big red statement, and I would have no clue how I spent so much money,” recalled Li, now 19 and an economics and statistics major at Duke University.
“I forced my parents to set a limit on my credit card, but I knew that was definitely not the best way of teaching myself personal finance.”
That’s how he came up with the idea of Zogo – a new mobile banking app that teaches teenagers how to manage their finances and establish good habits early on.
Using cutting-edge behavioral economic research and artificial intelligence, the app allows parents to automate allowance, set up tasks to reward teens and give money to teenagers in the form of a regularly scheduled paycheck.
Another perk: parents and teens don’t need to order a separate debit card from Zogo. Instead, they can simply link any of their existing debit cards to the app.
“I wanted to solve my own problem as a teenager, and also many of my friends’ problems as well,” said Li, who is self funding the startup using earnings from an earlier hedge fund venture. “Teenagers and their parents need this, and we are here to help.”
Expected to hit market by November
The product is expected to hit market by December. In the meantime, it’s being trialed by families at Durham Academy, and will soon start testing with other partners, including America Saves, a campaign coordinated by the non-profit Consumer Federation of America.
Local investors are also lining up.
Last week, Zogo won Startup Summit’s Shark Tank competition, walking away with local capital venture firm, Cofounders Capital, offering $300,000 in backing.
“It’s a great tool, and if they build it the way I envision it, it will be educational,” Cofounders Capital managing parner and Shark Tank judge David Gardner said.
“There’s a real gap in the education system today where we don’t teach any financial skills. This app will create teachable moments, and give parents the tools that they need to actually make sure their kids know these life skills.”
Nothing is finalized yet, but Li said he hopes to spend the funds on application programming interference, as well as development-related costs and marketing expenses.
“We want every teenager in the US, no matter their upbringings, to master personal finance. We are willing to do whatever it takes to achieve this goal, whether it is to partner with financial or education institutions or go to market as a stand-alone app,” said Li.