With fintech company Hyperjar, the customer is able to divide their money into virtual Jars, treating each like a mini account. The Jars reflect spending habits and goals the customer sets up. The mini account Jars can be used for recurring costs like groceries, fuel, kids’ clothes and bills, or to plan for things like a new bike, Christmas and holidays.
Hyperjar’s CEO Mat Megens has provided Everly.eu with an exclusive interview in which he has disclosed the company’s core philosophy and why he believes the idea of a sustainable savings app is more profound than it may seem.
Mat was born and raised in Canada where he studied engineering. His first job was in Ottawa building network switches. Then Mat moved to Boston to pursue a job as a circuit board designer within a startup company, where he believes he got his first ideas about entrepreneurship. He then decided to get an MBA in New York as he wanted to focus more on the business side of things which led to a move to the investment banking sector. Mat has a Dutch passport because his parents were Dutch immigrants. This made it easier for him to move to London where he worked for Lehman Brothers and Morgan Stanley. Mat has also worked for the IFC that provides developing countries with funding for innovative projects. Experiences from these companies have inspired Mat the most as he came up with the idea of Hyperjar.
How would Mat briefly describe the company?
“We created a visual operating system for your finances and that’s what we think is special. But what does a “visual operating system” even mean? Every person who deals with finances is trying to match different budgets and has complex financial relationships with either their spouse or children. The banking system offers either completely closed or completely shared accounts which we believe does not fit the needs of customers. We provide the customer with the visual idea of jars.”
“The customer sets up a jar and then decides with whom they will share it and to what extent. The jar is shareable with up to 100 people and each one may have different permissions. One person may be able to spend 10£, the other one up to 100£ and another could be just approved to view the transactions without any spending budget. We believe the visual operating system of „jars“ is very powerful.”
That does sound like a great idea indeed, but budgeting is already implemented in some fintech apps. A similar proposition, for example, can be found in bunq, a Dutch challenger bank. Does it work with physical cards or virtual cards?
“Every user gets a card. The thing is that you link the card to the jar you want to be spending from. If I want to spend from “Jar X”, then I would link my card to “Jar X”. Imagine you are on a trip with 5 friends, you go to Sweden, you create a Sweden jar, you all link your card to it. Anybody can spend, it all comes from the same jar. Our UX advantage is in the option of customization of our product. The user is able to create an infinite number of jars.”
You have mentioned the advantage of your UX and “visual operating system”. There are also neobanks who buy the whole core banking and are ready to launch in two months. How long has it taken to build the whole product for you?
“First, we are not a bank and we don‘t aspire to become one. With that said a lot of our functionality is what a bank would provide. If you are an HSBC customer, you can complement that with Hyperjar because we are going to get you a far better budgeting experience. The core architecture of our product is something we built ourselves during the past few years. Obviously, we could have used some third party product and we even use some, but it has to be perfect. We believe that if it isn’t perfect, we have to build it. And because of that, I believe our product is very different from anything I‘ve seen in the world.”
Many fintech companies are able to come up with amazing ideas but struggle with monetization. How does your revenue stream work?
“We have a monetizing model connected to the retail sector similar to Facebook and Google. This way we don‘t have to rely on overdrafts, lending, fx fees, or subscriptions. And that‘s where we believe we are very unique in comparison to any other fintech. That‘s also how we built the sustainable saving model because most savings apps don’t really have a business model. With Hyperjar you don’t get any surprise bills, every specific thing can have its own jar and own budget, like for example your child’s iPad gaming budget.”
You come from Canada and your parents are Dutch. Why did you choose the UK and what are your plans for expansion?
“I live in the UK so that is the main reason, but UK retail businesses are distributed nationally whereas in other countries such as the US and Canada, retail businesses can be more regional. This makes it much easier to scale our business. So first we are going to launch in the UK but we want to expand globally.”
Mat has also mentioned to us that their idea of a sustainable business model has always excluded lending and bringing customers into debt. What led him to this concept?
“The marketing objective of many fintech companies is to make debt seem like it isn’t even debt. But they are technically offering a credit card product. The point is there are lots of businesses out there who are monetizing by getting you into debt, that’s a proven model.”
“However, we just think that is an unhealthy model. We believe debt has its place but only if used in a responsible way. And there is a lack of apps that encourage responsible spending and saving. So our model is also adjusted to help you spend better. We don‘t want you to spend for anything you don’t need.”
“But obviously to make our model monetizable we have to find a middle ground. So we are a free fintech app subsidized by the retail sector because if the customer is saving money for something specific, there is value in that data for the retailer. There is a lot of intent data and we want to acquire the intent data and monetize it. That is how we were able to make a business model that is sustainable and encourages planning. If you save up for something, you feel good about buying it. Whereas if you buy something for an exclusive cashback opportunity, then you might regret it as it was impulsive. With Hyperjar we want our customers to look back and have no regrets. Our model sounds simple but is actually very profound and delivers longterm value to our customers and retailers.”
And what are some of your other plans with the company?
“We also plan to have a child card that would be a part of an adult‘s account to provide children with financial literacy from a young age, so we feel very excited about that. This adds to our philosophy of functional money. This way money in our app can be even restricted from being spent on booze or gambling or can only be spent at say Lidl or Kano. We want to give people the ability to monetize their own money because, at this point, the bank monetizes their money,” Mat Megens concludes the interview.