Sydney-based fintech startup Spriggy has closed a $2.5 million funding round, which it will invest in evolving its educational pocket money app and bank card and growing out its user base of more than 35,000 parents and children.
As part of the round, which was led by Alium Capital with additional funding from Perle Ventures plus several high-net investors, Spriggy also welcomed two new advisors – former ING DIRECT Australia CEO Vaughn Richtor and ex-Delivery Hero CTO Scott Fletcher.
Alexander Badran, who co-founded Spriggy with Mario Hasanakos in March 2015, spoke to Dynamic Business about the genesis of their startup, the significance of their latest capital raise and why competition from other pocket money services is ‘good for the market’.
DB: What is the elevator pitch for Spriggy?
Badran: We’re an independent technology and education company helping parents teach their children about money in the digital age. As we transition to a cashless society, educating children about money has become increasingly complex. Spriggy aims to solve this problem via our prepaid card and mobile app, which allow children to grasp the concepts of earning, saving and responsible spending online.
Parents can sign their kids up for a Spriggy card online in a matter of minutes, draw funds from any Australian bank account to add to the card and set up automated pocket money payments. The app allows parents to manage multiple cards at once, view transactions in real-time, and lock and unlock cards instantly, at their discretion. Further, Kids can set their own savings goals and view their transactions on the app, setting up separate accounts for spending and saving. The Spriggy prepaid card can be used online or in-store, anywhere that accepts Visa.
DB: Can you give a sense of Spriggy’s success to date?
Badran: Since launching in November 2016, Spriggy has signed up more than 35,000 users with over 200 parents and kids joining us every day. We were also featured on the H2 Ventures/KPMG Fintech 100 Emerging Star list last year. Closing a $2.5 million funding round is, of course, one of our major successes and will enable us to continue evolving as a business and better serve our customer’s needs. This funding is on top of the $300,000 we raised back in 2015 to help us launch.
DB: What motivated you and Mario to launch Spriggy?
Badran: With backgrounds in education and finance, we realised that money was a serious cause of stress and anxiety for a lot of people – particularly parents. We also shared the view that financial institutions should do more to help their users live happier financial lives. We created Spriggy out of a desire to provide a simpler way for parents to give their kids pocket money, while better teaching them about the value of money in the digital age.
DB: What’s the story behind the company’s name?
Badran: It combines the words ‘spring’ (as in to leap forward) and ‘piggy’ (as in piggy bank). During our early testing, we operated under the name Piggy but this was just a working title. We chose the name Spriggy because the core team and our earliest customers thought it was more memorable – it harks back to days when piggy banks were used, but it has a modern ring to it. It evokes feelings of fun, youthfulness, and an initial sense of responsibility.
DB: What makes your new investors ideal partners?
Badran: We’re all excited by the opportunity to offer innovative products and create value for customers in a space that’s remained relatively unchanged for many years. In addition to their capital, each of our investors offers a depth of expertise, which has already proven invaluable.
DB: What do your two new advisors bring to the table?
Badran: Deep knowledge of both the finance and tech industries. Vaughn launched ING in Australia, which is now one of the most recognisable challenger brands in financial services. He is THE expert when it comes to challenging the way people think about banking and delivering simple and straightforward products supported by an exceptional customer experience. Meanwhile, Scott’s experience leading billion-dollar tech businesses will play an instrumental role in how we approach growth and meet the challenges that lie ahead.
DB: What has been a key growth challenge for Spriggy?
Badran: One challenge we faced was not being able to meet some of our user’s needs when we were starting out, simply due to resources and the rate we were growing at. In recent months, we’ve doubled the size of our team to include more marketing leads and developers. This means we’re able to add new features at a quicker rate than previously possible, expanding our product even more to meet the needs of mums and dads country-wide. With this latest capital injection, our plan is to continue growing the team, building a delightful product, and increasing our brand awareness.
DB: Are other players in the pocket money space a concern?
Badran: We strongly believe that competition is good for the market and support any business, such as Pennybox, which strives to educate Aussie kids about money in the digital age. Teaching kids about money is no longer as simple buying a piggy bank and giving a weekly coin allowance. We want to inspire change, and as an education company first and foremost, see any movement that does this in a responsible and family-first way as a benefit to the community. The easier we can make the transition to cashless saving for Aussie families, the better. We’re currently the only brand, however, to offer Australian families a pre-paid Visa card for kids as young as eight and firmly believe that real-world practice is vital when it comes to reaching youngsters about money.
DB: Looking ahead, what do you have planned for Spriggy?
Badran: We are constantly looking at ways to evolve the product based on what our customer need, and will be focused on building out Spriggy’s functionality over the next 12 months to help more Aussie mums and dads teach their kids about spending and saving in a digital world. Our latest funding round funding round is critical in this regard as it will enable us to grow our user base and improve the financial lives of more Australians.
See also: Fintech startup Pennybox is on a mission to turn kids into smart savers, savvy investors