Augie
Setting the Scene
Over 54 million Americans lack sufficient credit history, severely limiting access to essential services like housing and insurance.
Traditional solutions pose barriers:
High Fees: Secured credit cards often require high deposits and fees.
Credit Checks: Many credit-building options still require credit checks, excluding those with poor or no credit history.
This week’s company, provides a fee-free, no-credit-check credit card that helps users build financial health with every payment.
In a Sentence
Augie is a free secured credit card that enables users to build credit history with every payment.
Free: Customers won’t be burdened by fees, interest, or security deposits.
Build Credit: Augie is the only card to offer transaction-by-transaction credit building.
Bulleted Version:
- Imagine a credit card that’s as simple to use as a debit card but helps you build a profile with every transaction, without costing you a dime.
The Basics
- Headquarters: NYC
- Investors:
HNWIs
- Funding amount: $1.5M in pre-seed funding
- Business model: Revenue from merchant interchange fees (1.8% per transaction) and data monetization
- Early traction: Signed agreements with key partners, Including several employee benefits groups, such as EBG, targeting over 60 million consumers
Due Diligence
WHAT WE LIKE
Market Opportunity: The market for credit-building solutions is vast, with over 54 million Americans struggling to establish or improve their credit profiles.
Patent Pending: Augie’s patent-pending, secured credit card operates like a debit card but builds credit on a transaction-by-transaction basis, which creates accessibility by removing barriers.
Low-Cost Acquisition Strategy: Augie’s B2B2C go-to-market strategy leverages trusted partners to acquire users at a low cost, potentially leading to rapid and scalable growth.
POTENTIAL RISKS
Retention: As users build credit, they may move to traditional credit cards, potentially reducing long-term retention.
Reliance on Partners: Although B2B partners will potentially help lower CAC, these partnerships could limit direct brand influence in conveying the value prop.
Regulatory: Augie operates in a highly regulated industry, and any changes in credit reporting, consumer protection laws, or financial regulations could impose additional compliance costs or limit Augie's ability to offer its services as originally intended.
Founder Profile
Paul Harkins, Corporate Development: A multiple-exit entrepreneur previously founded Billaway, as well as experiences at Instream Media, and offerIQ.
Amit Thakur, CEO: Previously at Morgan Stanley and Standard Chartered Bank with a 23 year banking career.
Comps
Chime: Backed by Sequoia Capital, General Atlantic, Amino Capital, DTS Global, and others.
Self: Backed by Altos Ventures, Meritech Capital, Conductive Ventures, and Silverton Partners.
Petal: Backed by Trinity Capital, RiverPark Ventures, Victory Park Capital, Valar Ventures, and others.
Why Augie
By offering the only free to consumer credit card that avoids unsustainable debt and incurring costs, Augie is set to charge ahead in the future of fintech.