(2010-10-03) Hedlund Why Wesabi Lost To Mint

Marc Hedlund (ex-co-founder of Wesabe) on why Wesabe lost to Mint.com. First, we chose not to work with Yodlee, but failed to find or make a replacement for them (until too late)... Second, Mint focused on making the user do almost no work at all, by automatically editing and categorizing their data, reducing the number of fields in their signup form, and giving them immediate gratification as soon as they possibly could; we completely sucked at all of that. (To be defensive for just a moment, their data accuracy -- how well they automatically edited -- was really low, and anyone who looked deeply into their data at Mint, especially in the beginning, was shocked at how inaccurate it was. The point, though, is hardly anyone seems to have looked.)

No one, in my view, solved the financial problems of consumers (Personal Finance). No one even got close. Yes, both products helped some people -- ours mostly through a supportive community and theirs mostly through giving people a rough picture of where their money has gone. But when we analyzed the benefits we saw for our users, and when Mint boasted about the benefits they saw for their users, the debt reduction and savings increase numbers directly matched the national averages. Because our products existed during a deep financial crisis (Credit Crisis 2008), consumers everywhere cut back, saved more, and tried to reduce their debt. Neither product had any significant impact beyond what the overall economy led people to do anyways.

So, yeah. Changing people's behavior is really hard. No one in this market succeeded at doing so -- there is no Google nor Amazon of personal finance. Can you succeed where we failed? Please do -- the problems are absolutely huge and the help consumers have is absolutely abysmal. Learn from the above and go help people (after making them immediately happy, first).

Khoi Vinh says: On the whole though, most of the Personal Finance applications I’ve come across are still not particularly imaginative or insightful tools, including Mint. I liken the category to digital calendaring. Using Outlook/Exchange or Google Calendar is a significant upgrade from a paper desk calendar, but it really hasn’t changed the way we approach the management of our time, and it certainly doesn’t result in us having more time. No one would say digital calendaring has solved that problem. To fulfill its real mission, personal finance software should result in users having more money.