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Everyone would agree that they see more "Made in Taiwan/China/Japan/etc" tags than "Made in the USA" tags for the past several years...
Home / Markets / Innovation
Friday, August 22, 2008
Innovation
Intuit Sees Competition From Upstart Mint.com
Donna Fuscaldo
FOXBusiness
New York--At a time when Intuit (INTU) is focusing more of its efforts on its online businesses, the maker of Quicken software is facing increased competition from an upstart website that has racked up nearly a half million users in less than a year.
Called Mint.com, the Mountain View, Calif.-based personal finance site that has venture-capital backing from Benchmark Capital and boasts a former Intuit executive as a board member, is betting its way of helping people manage their money will push the old stalwarts like Intuit's Quicken and Microsoft Money into the background.
“Quicken is not quick” said Aaron Patzer, the 27-year-old chief executive and founder of Mint.com. “It takes an hour to set up and too long to maintain.”
Mint.com aggregates all of a customer's financial data, including credit cards, savings accounts, mortgage loans and investment portfolios. The service, which is free, automatically will update when a user buys something, withdraws money or makes a payment. The purchases are tracked so users can see graphs and charts of what they are spending their money on. They also can compare their spending habits to other users in cities across America.
But Mint.com doesn’t stop there. Instead of charging users for its service, the company struck deals with 7,000 financial institutions to offer customers credit cards, loans, checking and savings accounts and mortgages. Using proprietary technology, Mint.com is able to give customers credit-card deals customized to their spending habits and shows the customer how much money they will save by switching cards. For instance, if a customer spends a lot of money traveling, Mint.com could offer a credit card that will help the globetrotter save on trips.
“Most people have a checking or saving account that’s not earning much interest," said Patzer. “Mint.com recommends an optimal credit card (or account) for you based on your interest rate and spending habits.” Mint.com makes money when its customers switch to a new financial institution.
Patzer said he started Mint.com out of frustration he found with using Quicken and Microsoft's (MSFT) Money throughout the years.
“I would spend an hour every Sunday afternoon managing my finances,” said Patzer. “I got busy at a startup and hadn't logged into Quicken and it asked me to reconcile 500 transactions. It got me thinking: Can’t a computer do it for me?”
Mint.com’s success comes at a time when the grandfather of easy-to-use personal financial software, Intuit, is looking to grow its online business. While the consumer side of Intuit only represents a small portion of its revenue, it’s an area analysts said it can’t ignore.
“Intuit needs to do a better job with Quicken online,” said Gil Luria, an analyst at Wedbush Morgan Securities. “When you ask them (Intuit) what keeps you up at night, they don’t say Microsoft. They say the Mint.com’s of the world.”
According to Luria, Mint.com has come up with a “disruptive” business model that uses “distributive” technology. He noted that while Intuit was the first to develop easy to use personal-finance and small-business software, consumers these days are drawn to software that resides online, not on the desktop.
Scott Gulbransen, a spokesman at Intuit, said Mint.com has a different business model than Quicken.com, which was launched in January.
“Mint.com relies on advertisers and people switching banks and credit cards, which we don’t," he said. "Part of our mission is to help people get out of debt not move debt around.". While Gulbransen acknowledged that Mint.com is more “nimble” in its use of new technology, he said Intuit is refreshing Quicken online to ensure it doesn’t “become your father’s Quicken.” Gulbransen declined to name how many customers Quicken online has.
Mark Goines, a former Intuit executive and investor and board member at Mint.com, said what makes Mint.com stand out from the pack is the little effort needed to set it up and use the application. When setting up an account, all a customer has to do is choose from a drop-down list of financial firms, log in with the password for that institution and the data is automatically uploaded.
“It’s really easy to use. Aaron [Patzer, Mint.com's founder] has taken advantage of all the Web technologies to make it a really easy experience,” said Goines, noting that the fact that it’s free draws users.
According to Goines, Mint.com also benefits from its start-up status. After working for close to 25 years at large financial companies, including Intuit and Charles Schwab, one thing Goines learned is that often times big companies have a tough time embracing new technology.
“They couldn’t seem to innovate fast enough,” he said. “They didn’t seem to have the spirit to take the technology to the customer.”
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