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I'm not entirely sure why there needs to be a financial services or banking contract to build this app and startup. What's wrong with PayPal? Or bank accounts?

• Xyik 10y ago
  I'm also curious about the bank integration issue, but I'm tired of people saying things like why app x or website y "couldn't be functional in the first week". have you launched an app that you expect to build a company out of? it takes a lot more work than most people think. people love to over-simplify building software by saying 'its just an app', oh, twitter is just a list of sorted strings, seriously try building a solid, fleshed out product you expect thousands of users to use in 1 week. it's not that easy.
  • xigency 10y ago
    Fair points. I really am commenting as an outsider, so don't think that I speak from experience. As a programmer, though, I am much more interested in seeing something built than in selling it or seeing it become popular, which fair enough are the next two places a startup can fail. "One week" is also hyperbole because it isn't possible to deploy anything in that amount of time, so maybe in the first six-months is a fairer comparison.
    • lmm 10y ago
      > "One week" is also hyperbole because it isn't possible to deploy anything in that amount of time, so maybe in the first six-months is a fairer comparison. Not true. One week is plenty of time to plonk down a website in a basic CMS with an email form, or even a bit of code that sends you a daily spreadsheet of orders or whatever. Often that's all you need to validate the idea.
      • schwarrrtz 10y ago
        Yup, and you can even spend $50 on AdWords and estimate your CAC by measuring conversion rates.
  • xigency 10y ago
    Reading a bit more into the financial side of things — PayPal users must be 18 or must be using their parent's account. Adults can have one personal and one business account, so that wouldn't really work. It also isn't easy to get a plastic PayPal card. I hadn't thought about the minor accounts which obviously complicates things. It would have been harder to pitch but easier to start with small payments between friends in the app and work back around to the chores/PiggyBank idea. Still seems reasonable to expect a parent to set up a bank account for their child and then facilitate PayPal deposits into an account. ACH deposits have low fees but they're delayed one or two days. Was instant gratification the blocking factor? Why not use Bitcoin, for the hell of it. So I don't see what the problem is with — supply your own debit card, child's bank account, and adult PayPal account — then sign-up and press on.
  • 10y ago
• MOARDONGZPLZ 10y ago
  I agree with all of this except the one week thing. But the thing is, these deadlines were self-imposed. It wasn't like someone else was imminently about to release a similar app and they had to race to get it working. At least spend the time to get it working and fully-functional before really shopping it around. Rather they wanted to churn out some half-baked, random "good sounding" idea and then when they got funding race to make it work. In my experience when I'm building an app or something, I learn a lot about what features make sense and what's going to be really hard to implement while building it out privately or with a small team. I/we address those issues and look for solutions or other ways around and aren't on a schedule to ship some product and hire some backend database developer to fill some huge knowledge/experience gap on short notice. Of course hindsight is 20/20, but I think not jumping the gun like this should be good business practice. Really I see no reason why someone had to quit their job for something that wasn't even functional. If it's functional and getting some traction and has funding, great, quit your job and do it full time, imo. As an aside and maybe an unpopular opinion, I really doubt the founder's long-haired look was helping the brand's perceived legitimacy. Though I don't have a problem with it personally, I know the "out there" look can turn a lot of people off.
• madelinecameron 10y ago
  I was rather surprised that the founder who came from Stripe failed at this. You would think coming from a bank startup would make you acutely aware of these problems. Apparently not.
  • hkarthik 10y ago
    The difference comes from experience with banks versus experience with credit cards. These are very different in terms of implementation. Companies like Stripe initially focused entirely on inserting themselves into the Credit Card ecosystem. Banks are inherently slower to innovate and process because they are financially motivated to hold your money and collect interest by being slow. If you want to move money fast between banks, you will pay for that right with high transaction costs. Credit card companies, on the flip slide, are incentivized to go faster because they make money through transaction volume. They want you to use the credit card more often so they can collect tiny fees on every transaction. Payment companies typically focus on the credit cards first since frankly they are way easier to work with. They want to move money and they are happy to help with that process.
  • JeffreyKaine 10y ago
    Founder came from Bank Simple, not Stripe. (I'm pretty sure you knew that already and made a simple mistake, but I wanted to clarify for others who may comment.)
• ChemicalWarfare 10y ago
  Long story short here is this app isn't acting as a "merchant" rather as an intermediary between counterparties in financial transactions which requires banking relationships to be established to drive the flow of the funds. Also keep in mind that Stripe/Square/Braintree etc are processors not banks. They will help you move the funds around but as far as where those are moved from/to that's on you even if you're a Merchant. Once you get into the "middle man" business the plot thickens quite a bit.
• superuser2 10y ago
  PayPal, Stripe, Square, and Braintree (which is PayPal) are interested in helping merchants accept payments for goods and services. Dunno about Square, but PayPal and Stripe explicitly disallow the use of their platform to build any other money-sending service. In generally children need to be driven to the bank by their parents, so why we'd also loop in a 3rd party (instead of the parent writing the child a check) is unclear. My family solved this problem by maintaining an informal ledger and settling by transfer between our (linked) accounts at the same bank, but there's no way a random startup would get that kind of API from all the major banks - AFAIK even Mint is still screen scraping.
  • infinite8s 10y ago
    As a side note, your informal ledger and settling is basically how the entire securities industry is run (look up DTCC).
• hrabago 10y ago
  > having users is at least some sort of reward. When you have the revolutionary breakthrough, add that to the app Actually this approach "MVP" works well with web applications, but it doesn't work too well with mobile apps. In fact, it's quite the opposite. With mobile apps, you have to make a big splash in your launch, get most things right, and just minor tweaks once you're launched. The alternative approach is to launch your MVP in a small and/or isolated market (a non-US country), hash it out there, and once you have your approach all figured out and your "revolutionary breakthrough" working, then do your main release worldwide.