French Fintech startup called “Kard” aims to provide families with an account where parents are able to send their children instant finances while the teen customers are learning a lot about financial literacy and responsibility.
Launched in September 2019, Kard raised a € 6 million seed round from Founders Future and business angels, including several global Fintech experts. “We had 250.000 people on the waitlist before the launch with our refer a friend and get 1€ system,” said Scott Gordon.
The Founder & CEO at Kard Scott Gordon has provided Everly.eu with an exclusive interview in which he addressed what led him to the idea of Kard, why he believes we are experiencing a second wave of Fintech companies, and where he sees his company in the future.
Could you tell us more about you and your past professional experiences?
I am half American and half French, but I was born and raised in Morocco and lived there until the age of 18. Then I decided to study hospitality, mainly because I lived in Marrakesh that grew tremendously because of tourism. When I was born, it was difficult to buy diapers and when I left there were 14 golf courses there. So I saw a huge opportunity in the hospitality business and I am a very social person so I thought that could work well together. After graduating I moved to Dubai. I worked as a revenue manager there and my goal was to optimize the prices of hotel rooms according to the demand.
I then moved to Paris to study for my M.B.A. and the iPad came out. My idea was we could use the hardware of the device and create software that we could sell to restaurants to help them optimize their revenues and get a better understanding of their data. That was when I launched my first company called Tiller with my best friend and cousin and as we were scaling the product it grew quite nicely, to say the least (Tiller is today the leading iPad-based POS for Restaurants in France). The company is still doing great but I left it and moved on while keeping some equity and a board seat. Then I moved to Singapore to work in Strategy and M&Afor a hotel company called Accor.
How did you come up with the idea of Kard?
The idea came up when I was speaking to my cousin which is older than me and already has children. Her 10yo kid went to a surf camp so she gave him about 50€ pocket money. And as it was the kid’s first time alone away from home, he obviously spent the money right away for candies and other stuff. But he needed the money for something that wasn’t included in the price of the camp, so he called his mother asking to send him money and there wasn’t really any way to send it to him except sending an envelope through the french post office with a 50€ note.
So I was surprised by how the digital world did not really provide any financial solution for families and a simple way for parents to send money to their children instantly. That’s how we came up with the idea of Kard but obviously, we found out that we are not the only one out there. However, from my experience, if you are going into a sector where nobody has tried it’s either that you are a genius and it is going to be hard or it’s the wrong business and there is no business.
Two years ago when Kard was founded there was not much competition in terms of teen and kid accounts and cards but a lot has changed since then. How do you feel about the situation on the market now?
We have a very niche market and there are always leaders in these specific markets but it is not a “winner takes all” kind of situation. I believe we are still in the very early stage of a Fintech revolution. If someone had asked you 10 years ago, if all teenagers and kids would have smartphones today, you would have probably said no. And in terms of teenager accounts, it is a similar situation now. I am confident that within 3-5 years 100% of teenagers will be banked. We are moving away from cash and society is getting more and more digital so it is just a matter of time.
I think our segment is the most strategic, today traditional and challenger banks are looking big-time into it. What we are seeing now is the second wave of Fintech companies. In the first wave, you had companies like Revolut with a great product, great UX and UI that attracted millions of customers. But I believe it’s going to be very hard for them to win the primary banking relationship battle against traditional banks. Capturing existing customers from traditional banks is hard and very costly. People are always going to be willing to test your product, for example when they travel, but they will use it just in specific cases or even stop using it sooner or later.
It’s a different story for Kard, we are positioning ourselves as the first account and we don‘t want to get rid of our customers when they turn 18, on the opposite our goal is to grow and keep them forever. We are dealing with a specific generation here that is used to revolutionary business models like Uber and Spotify. My aim is to do what Spotify did with music but with banking.
And what attracts the kids or teenagers in terms of banking?
First things first, they want a cool card. Although we heard the arguments that cards are dead, they are still a thing. The symbolic of your first own card is amazing. You will always remember your first card. Mine was blue and looked like a library card. So we did put effort into designing a cool and personalised looking card. And because we don‘t show any personal information on the front of the card, people and teenagers are sharing pictures with their cards on social media.
Our mission is to educate the next generation to be smarter with money . Schools don’t teach you about money and very few parents do . With our product, the customer will get a better understanding of money and how to save in a wiser and smarter way. So savings is a core aspect of what we do.
Do you feel like there is a feature that is not yet on the market?
We have a feature that blends a social aspect to the banking industry where you can share and interact about your spendings, savings, with friends. Our idea was to build a much more community based financial service.Money is taboo, even more so in France! We’re going to demystify it with Kard.
Was there something that did not go well along the way for you?
We did not work on the business model from day one and that was a mistake. I also hired too many people too quickly, we went from 8 employees to 35 in four months. So we scaled the company too fast and this damages the culture of the company.
And do you plan to expand beyond France?
There are 80 million teenagers around Europe so absolutely. After the pandemic is over the expansion is our priority. If in 3 years we could become the market leader of the teenage segment in Europe, I would be extremely proud and happy.