FinTech startup aims to get Australians out of debt and $10K in the black

- July 30, 2014 3 MIN READ

Still banking with your Dollarmite account? Time to grow up, homie. Debt To 10K is a new online service designed to help those with sporadic spending habits create a custom repayment plan to pay off bad debts and reach a savings goal of $10,000.

Why $10,000?

Co-founder of the business Jessica Bailey says that  they wanted to create a goal that was achievable, yet still significant enough to make a difference for members. “We know $10,000 is not nearly enough for a deposit in today’s market, but it does show that our members believe it’s a beginning they can continue with,” said Bailey. 

The service is similar to setting up a dating profile; a user completes the sign up process and a four-step wizard guides them through the account setup. Members then input their income, expenses and bad debts and this data is used to generate a savings plan. Along with this plan, users can also access a savings toolkit which consists of a range of educational challenges and money saving deals in the areas of insurance, home loans and everyday living.

Any savings made through the use of the toolkit are then automatically fed back into the repayment plan to demonstrate the accumulative power of these small savings.

Bailey and Simpson started Debt To 10K after noticing that one in three Australian credit card holders admitted to struggling with their debt repayments. With Bailey’s experience working in an insolvency office, she was able to witness the constant struggle people faced thanks to greedy finance providers and general lack of willpower.  

“It’s a two-way problem and we’re tackling both sides,” Bailey said.

“We created Debt To 10k to give these people an empowering, long term solution to help them clear bad debt. Our business is doing something that no one else in the space is doing – giving our members hope, knowledge and access they need to take control of their own situation.”  

“They develop a sense of pride they’ve fixed their problem themselves instead of paying for the problem to go away.”Debt To 10K received support through the AWI Ventures accelerator program on their journey to becoming a full-time business. Bailey says that they received $50,000 cash investment plus an additional $50,000 in services for a 10% equity share of the business. 

Product development was straight forward according to Bailey, as Simpson is a Microsoft developer of 15 years who designed the system to be simple. The duo built their MVP as soon as they got their first 50 sign ups which only took a weekend of Facebook ads. This build is now complete and beta testers already have access to the full range and functionality of the service.How does Debt To 10K generate revenue?

“When our members take advantage of the money saving deals by either clicking through to the provider website, or signing up for a particular product, Debt To 10k will receive a referral fee from that provider,” explains Bailey.

Competition doesn’t seem to phase the pair just yet as Bailey says that their main competitors are offering different solutions to the same market. These competitors, according to Bailey, are personal budgeting services and Government regulated debt agreements – solutions which tend to offer short-term fixes where customers pay a fee to make the problem go away.

“Debt To 10k is different as we create a long term solution, breaking the cycle of debt through education.”For the moment, the service in its early stages has seen moderate success in the market. Their greatest achievement thus far is “simply giving hope to our early adopters” says Bailey.

“We’ve received feedback from 50% of these early adopters and in summary, they’ve been waiting for something like this for years. They’re excited to tackle their debt issues and are motivated by our ‘light at the end of the tunnel’ message. They have been overwhelmingly positive with our members really supporting our vision for this business.”

Naturally there’s no startup story without a few hurdles. The biggest challenge for Debt To 10K to date? Trying to connect with the right people in corporate Australia so that they can access more attractive deals for their clients.In the next twelve months, the duo’s goal is to help 5,000 Australians take back control of their finances without paying someone to make the problem go away.

More information is available via debtto10k.com.au.