PocketSmith CEO: What Mint's Closure Means for the Future of Personal Finance Software

A very brief history 

It tickles me to think that we’re continuing a tradition of products that began in the early days of personal computing. 

The very first PFM, Quicken, made its debut in 1983. Its success was notable, as was the impact of Microsoft Money, which entered the scene in 1990.

At that point in time, PFM was still a relatively niche product as it catered to home budgeting enthusiasts with personal computers. Software came boxed and on floppy disks, data was manually entered on heavy keyboards attached to big beige machines, and it wasn’t until the mid-2000s that online versions emerged. 

Wesabe and Mint were a part of this first wave in the US. They capitalized on the ability to swiftly import account transactions through file uploads and connecting directly to users’ financial institutions — a feature colloquially called “bank feeds”.

While both were popular products that were free to use, Mint was eventually acquired by Intuit (which was then Quicken’s parent company), whereas Wesabe shuttered its operations. This showed the significance of bank feeds as a crucial part of a successful PFM user experience.

Mint, becoming a free product supported by a multi-billion dollar company, steadily grew its market share, introducing a new generation of people to online money management.

While its significance and value to the public should not be understated, Mint’s dominance has long disrupted the market dynamics for subscription-based PFMs by setting a precedent that alters user expectations. 

In doing so, it has also posed a unique challenge for companies like ours that have chosen not to pursue venture capital and instead, self-fund in order to stay independent.

Thanks, Mint

Today, in the roaring 2020s, consumers are much more privacy-aware than they were a decade ago, and many are now familiar with the phrase “if you’re not paying for it, you’re the product”. 

But in the 2010s, it wasn’t uncommon for more people to be offended by the fact we charged for PocketSmith, asking, “Why should we pay for software to manage our money?” as if there was a grand irony in having to pay a reasonable subscription fee that would diminish the pool of funds they were looking to save.

This was largely because Mint’s backing by Intuit furthered the narrative that consumers saw little value in paying for PFM. Its supposed commercial success with a free model shaped the landscape in a way that made it seem peculiar to build a SaaS business around PFM with a traditional subscription fee structure.

It should go without saying that PFMs cost money to build, maintain, and support — just like any other software. They also incur ongoing costs for each customer because bank feeds are subject to fees, and they’re expensive and complex to maintain.

It may be that the very presence of bank feeds implies that PFMs are also somehow bank-like and have deep pockets, but no. We don’t hold customer funds, we don’t earn interest from deposits, and we don’t take percentages of customer transactions. Still, we’ve been expected to wear the cost to serve and recoup it through means other than subscriptions, like ads. 

The recent closures of popular free PFMs in the last year alone — Pocketbook and MoneyBrilliant in Australia, and most recently, Money Dashboard in the UK — seem to indicate that this business model doesn’t work. Now, perhaps the chickens have finally come home to roost for Mint as well.

PFMs are not just about helping people count their pennies. They also save people time because they put actionable financial data at their fingertips. They save people from stress, heartache, and poor financial decisions by presenting important information in a useful manner. These things are absolutely worth paying for. 

All this aside, a company that has a duty of care over your personal financial management should not be incentivized to sell you financial products and services. Val Agostino at Monarch Money has written an excellent piece about this very topic.

As we bid farewell to the reign of a titan, we welcome a whole new generation of users and companies who we believe will contribute to an incredibly bright future for PFM.

Personal finance isn’t a one-size-fits-all problem to solve

The presence of a dominant PFM establishes a “common” approach to money management that is assumed to work for all. This risks alienating those who don’t resonate with its features, causing many to feel that effective money management is out of their grasp.

The original idea for PocketSmith was a simple calendar for your money that would help you forecast your future bank balances. We firmly believed that we had created a new and better way for people to manage their money, so our original business model was designed around the calendar.

As we shipped our alpha and beta versions in 2008, we quickly learned that people had a wide range of reasons for working on their finances, along with a wide range of mental models of their money.

We learned that while there’s an allure to making money management “simple”, relying on simplicity does little to help us when our finances inevitably get more complex as we grow families, make homes, and go on to lead more interesting lives.

This understanding led us to the product we have today: PFM for all walks of life. One that grows with you, and that offers you the tools you need to find the facts in your finances so you can make the best decisions for your future. The original calendar is now one of a suite of features available to our users.

It wasn’t easy to build the product we wanted for the people we wanted to help. Growth took time amid a market that wasn’t wholly receptive to paying for PFM. Over the last fifteen years, we’ve seen other PFMs come and go, and I wonder if we would be seeing many more innovative products today had the landscape not been in the shadow of Mint’s eclipse. 

Now that the Mint era is over, I’m hopeful for a gradual adjustment of that landscape. I’m optimistic about what this means for our industry, and, most importantly, for you, the consumer.

The rise of the boutique PFM

If you’ve only ever used Mint, I’m excited for you because you’re about to discover what boutique PFMs have to offer. And yes, most businesses are “boutique” when compared to Intuit — but hear me out.

The businesses I’m describing make PFM software at an artisanal level, and we share a very similar set of values, among which:

• We each have a clear purpose to fulfil and a reason for believing in it (i.e. an interesting origin story).
• We care about the mission, and we care about people: our customers, our teams, and their families.
• We believe in aligning our incentives with positive customer outcomes.
• We believe that personal finance isn’t a one-size-fits-all problem to solve. It’s okay if our software isn’t a good fit for a customer; we’ll happily recommend another that does.
• We have a high degree of control and independence and are likely still founder-led.
• We use our own products, we believe in privacy, and we put our energies into building an Internet that we want to leave for our children.
• We don’t believe in growth at all costs.

It is a rewarding experience to engage with a product and business that you feel a connection with. You’ll know it when you find one that prioritizes your best interests, aligns with your perspective on personal finance, and is genuinely enthusiastic about embarking on a journey with you. You’ll know, because the product will resonate with you, and if you reach out to the company, you’ll find passionate people keen to support you.

So please go check out:

• Tiller if you love spreadsheets
• Copilot if you love beautiful Mac software
• YNAB if you love a system that guides you
• Toshl if you love a team with an impish sense of humour
• Monarch Money if you love to manage money with someone you love
• And of course, PocketSmith, if you love all of the above (yes, we’re being cheeky)

Mint started out as a boutique PFM, and I foresee its legacy being cemented as both an inspiration and a cautionary tale for us.

A day in the life of PocketSmith

I’ll leave you with a glimpse into what our boutique PFM does on a day-to-day basis. We’re a remote-first team of 24 based in New Zealand, serving customers in over 190 countries.

Over in Support, we’re reading and responding to customer emails about topics that range from the minutiae in our features, through to offering help setting up things like budgets, forecasts, and mortgages. We have two teams in Support. One is dedicated to guiding customers, and the other is dedicated to helping customers with their bank feeds. We partner with multiple data providers to offer the most reliable bank feeds in each region because we know how important it is to have timely and accurate data.

We take a collaborative approach towards customer support, often seeking advice from each other in order to craft the most accurate response we can for our customers. 

Along the way, we take note of customer feedback and raise it with our designers and product owners in order to maintain a constant rate of improvement to our product. We also keep tabs with the Marketing team to ensure that we’re mutually prepared for upcoming campaigns. 

We also keep our Learn Center as up-to-date as possible with comprehensive guides on how to make the most of PocketSmith, and there will be no end to the number of articles we’d like to write.

We’ve been chosen for this role because we’re loving, empathetic, and artsy. Seriously — from bands to baking to brushwork, we’ve got it covered.

It tickles me to think that we’re continuing a tradition of products that began in the early days of personal computing. I hope we make our forefathers proud.

Our Engineering team cycles between upkeep weeks and sprints, and we have a Slack channel dedicated to S4S, or Support for Support. The latter is a hotline that we spring to when one of our friends in Support needs a hand. We may offer some some timely advice, fix a newly discovered bug, or tinker with any plumbing issues that might arise with bank feeds.

We’re composed of experts in our field, and we hand tasks elegantly to each other, from the stack to the back end, to our front end, and beyond. Curiously, we all share a love for craft beer.

There is no shortage of work to do, and we manage to deliver while constantly working to pay down our technical debt. It’s pretty great actually, considering our technology will celebrate its Sweet Sixteen in 2024.

We keep a keen eye on PocketSmith’s vital statistics and ensure that it never runs out of steam, especially when demand is high. Every so often, we surprise the team with a new innovation or improvement that makes things better for the team, our customers, or both.

We’ve been chosen for this role because we take an immense amount of pride in our work, we’re trusted to make ethical decisions, and we’re constantly looking to deliver a better experience for our customers and our team.

Meanwhile, over in Marketing, we’re getting together for our weekly morning tea, where we extend an open invite for everyone in the company to join in. This might give you a clue that we’re PocketSmith’s social butterflies, and this is why we’ve been chosen to be the voice for our company.

We love popular culture, books, music, and film. Later today, we’ll connect with some of the many people we enjoy working with — an influencer in Melbourne, a publication in North America, and our favorite podcaster from right here in Central Otago, New Zealand. 

We keep our blog updated with interesting articles and customer stories, sometimes sharing perspectives from our friends and family. We keep a keen eye on statistics and pay attention to how our customers are using our product.

Our designers are part of our team, and so we’re plugged into the Engineering and Support teams by way of user experience and user interface design. It’s important to us that we can collectively express ourselves honestly through our work.

Our Founders flit between all teams and find it an absolute pleasure working with people who are amazing at their craft. Together, we determine our commercial and product strategies and do our best to convey them to our team. We remain dedicated to nurturing and preserving our culture and values.

We’re now fifteen years old, and still, we thrive on the same kind of excitement and energy we did when we were founded. In many ways, we’re still just getting started. 

So — yeah. It tickles me to think that we’re continuing a tradition of products that began in the early days of personal computing. I hope we make our forefathers proud.

As we bid farewell to the reign of a titan, we welcome a whole new generation of users and companies who we believe will contribute to an incredibly bright future for PFM.

Jason is the CEO and co-founder here at PocketSmith. He is fascinated by our unique relationships with our money, and is passionate about making peoples’ lives better through the technologies we craft. He’s been a sneakerhead since the 80’s, and loves gardening on sunny days while listening to Planet Money.