stevesaldana

13 anni fadiscuss

I recommend jumping into topics that are relevant to what you are working on and aim to be a subject matter expert on whatever it is. I got involved in a conversation on HN related to my project (how to manage debt) and came away with a lot of good feedback and a few signups. It didn't solve the problem overnight, but every little bit helps.

stevesaldana

13 anni fadiscuss

My company was accepted as well. Looking forward to seeing you there! Before I applied, I read Nate Lustig's book [1] and found it helpful.

[1] http://www.amazon.com/Startup-Chile-101-Everything-Business/...

stevesaldana

13 anni fadiscuss

I'm not really sure I have an answer to that as I'm just figuring it out as I go. The most typical customer would be a first-time homeowner, early 30s, and 18-36 months post-grad school. At that point, you've accumulated a lot of debt, but likely have a well-paying job and stable career.

Everyday, I question if the Internet is the best place to market something like this and if a price point in the $5-$15/month range is too low. Eventually you start to creep up towards the level of service that a personal financial advisor would offer. But, I have limited desire to support the asset-side of household balance sheets (401K, stock investments, cash, etc). It's not that I don't want to go down that path, it's just that there are many more variables once you start to incorporate investment objectives, risk tolerance, return forecasting, and stochastic outcomes.

The other marketing challenge is how to cater towards people outside the US. In Europe especially, there are some crazy forms of credit made to people which have all sorts of embedded optionality. I used to work for a bank, building models to forecast this kind of stuff and it was such a challenge looking at it from the lender's perspective, I can only imagine the confusion from the borrower's point of view.

stevesaldana

13 anni fadiscuss

Thanks for the advice!

stevesaldana

13 anni fadiscuss

Ironically, our target market is actually folks who are the top 60% income earners in the US. Debt and income are directly related, and higher earners have a majority share of the debt in the nation[1]. It makes sense intuitively because these are the people whom are more likely to have tertiary education degrees and a mortgage. So, I'm really trying to find the sweet spot of households with low debt-to-income ratios (high ability to repay), but also large amounts of debt (high need for a solution).

Lower income earners, with primarily unsecured credit card debt for example, are basically faced with two options - spend less or earn more. There's no panacea that software can provide, other than increasing awareness of costs and consequences.

Thanks for the link - I'll check it out.

[1] http://www.federalreserve.gov/pubs/bulletin/2012/pdf/scf12.p...

stevesaldana

13 anni fadiscuss

There isn't one at the moment. I removed it about two months ago as an attempt to encourage more signups.

stevesaldana

13 anni fadiscuss

Your third point is good and one that I personally think is the most impactful. At the end of the day, everyone has their "price". You can't take BTC to the grave with you, so at some exchange rate, you are a seller. For some people this amount is $130, or $500, or $5000. But at every new BTCUSD high, it introduces a new group of sellers and eventually all hoarders will get shaken out.

I'm not sold on your second point "someone who sells a Bitcoin for X would have been equally happy to spend it on something they value at X." Using daily volume on Gox as an example, just because $2M changed hands yesterday, it doesn't necessarily imply that these folks would have happily exchange their coins for a good or service. A lot of this volume could represent traders getting in and out of a position, not someone ready to empty their account. However, your general point is that liquidity is a positive reinforcing signal, and I can agree with that. If liquidity is increasing because more merchants need to swap out, this is a direct indication that spenders are willing to transact.

stevesaldana

13 anni fadiscuss

You are spot on. There are so many alternative fee-generating sources and maybe I've been too stubborn at ignoring them. My motivation going into this was that I wanted to create something that provided a definitive value of x, and have customers happily pay a function of x. The known value / known cost approach seemed fair to me.

Pitching additional product for me is troublesome because of the intrinsic fees associated with them. I look at my service as something that accelerates debt repayment in the most efficient way. But to encourage customers to roll-over into a cc balance transfer, mortgage refi, or student loan consolidation, it just pushes their obligations further out in the future. Now, this might not be a bad thing for some people. But ultimately you could get a lot of people into the fee roulette game and it becomes a never-ending cycle where every economic peak and trough of high->low interest rates creates a new incentive for a financial services company to pitch new product.

So, I struggle with this. Do I want to maximize my revenue, or do I want to just provide a really good service for the small group of people willing to pay for it...

stevesaldana

13 anni fadiscuss

Guilty as charged. But I do appreciate hearing it directly from you as it serves to drive the point home.

As a first-time founder and relatively new developer, I could never really tell when the time is right to stop creating and start pitching. Looking back, I definitely went too far with the build, but better late than never to snap out of it and start soliciting.

stevesaldana

13 anni fadiscuss

The article opened my eyes to that. I am treating all feedback as valuable, whereas that might be the wrong way to go about it. It's clearly something I need to think about more deeply and work on discovering the true customer pain points, not just the "it would be nice if you had x, y, z" type of response I'm accustomed to reacting to.

stevesaldana

13 anni fadiscuss

One of the biggest problems I face is determining when the time is right to shift from free to paid. I originally slapped a subscription page on my app[1] thinking "we'll see how this goes". But after a few weeks of 0 conversions, I had a tough time justifying turning down folks who would have at least signed up if there wasn't a payment required - so I made it free.

The way I look at it is that any feedback with a free plan is better than zero feedback with a subscription. I gain a lot of valuable insight observing how users actually use the service. I'm hesitant to give that up by switching back to a subscription plan and watching new signups die again.

I know there's no magic bullet. I suppose this could be solved quickly if I had more time to devote to selling and marketing - admittedly I've been slacking in that department.

Any words of wisdom would be much appreciated.

[1] https://beanjockey.com

stevesaldana

13 anni fadiscuss

I just received their email (5:35pm EST)

stevesaldana

13 anni fadiscuss

To clarify, my definition of savings refers to "payments you would not have had to make". Regardless of the proportion of principal to interest, the payment is still the contractual amount you have to pay each month. If you have a fixed minimum payment, any extra payment you make is not impacting the amount due next month.

To your point, yes, next month's payment has a higher ratio of p:i, but you have not "saved" anything...yet. In the end, the extra payments you make are just going towards reducing the maturity date of the loan. You are correct that the relative impact of making these extra payments early on does have a tremendous influence on the total interest saved over the life of the loan (and determines how many minimum payments you will chop off the end of your term). I didn't make that clear in my initial comment.

stevesaldana

13 anni fadiscuss

Sure, no doubt in many cases the interest savings would be worth it. The real benefit of looking at the timing of savings is apparent when comparing multiple loans with different contract terms, and trying to figure out which you should be paying off quickly. All else being equal, two fixed-payment loans - one with 120 months remaining and the other with 360 months remaining - each have different "savings profiles". That is, they have different points in the future when the savings are actually going to recognized as well as different interest savings amounts. It can get kinda difficult trying to figure out if saving $1000 in 10 years is better than saving $1500 in 30 years, for example.

stevesaldana

13 anni fadiscuss

You make a good point. Consider making an extra payment on a 30-year fixed-rate mortgage. The "savings" you recognize are not showing up tomorrow, next month, or even five years from now. What you are really doing is shortening the maturity of your loan (knocking off payments at the end of the term). So, in most cases, making extra payments on a mortgage is essentially making a bet on future interest-rates / inflation in years 25-30 from now.

stevesaldana

13 anni fadiscuss

I had a friend that approached me about 18 months ago regarding the best way to pay down his loans. I started with a simple model and as it came to fruition, wound up with a solution[1] that factors in the present value of savings, future interest rates, and tax consequences. This is a more mathematical effective strategy for paying down debt.

By considering the present value of savings, you are able to judge the relative difference between a loan that recognizes savings in 30 years vs 10 years, for example. Future interest rates are important here because it reflects your opportunity cost of paying down debt (ie you could be saving this money in a risk-free investment instead). Lastly, taxes are extremely impactful because, for those who qualify, paying down a tax-deductible mortgage or student loan ultimately lowers your after-tax income.

Although my site is still somewhat beta, I invite folks to come sign up for free and give it a try.

[1] - https://beanjockey.com

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