Many Lincoln musicians have made the annual mid-March pilgrimage to Austin, Texas, for the ever-expanding SXSW Conference and Festivals.
Bands play in nearly every venue and busk on the streets. An eye-opening set at the right showcase can lead to a next-level opportunity.
And droves of showgoers in that oft-targeted millennial age bracket blow through their meager savings at shows, bars, brunches and the like during the bash set for March 10-19 this year.
On March 11, Lincoln entrepreneur Mark Zmarzly will try to convince a panel of judges that Hip Money, the latest app he and his Hip Pocket team designed, can persuade 20-somethings, 30-somethings and really anyone with a smartphone that stashing a few bucks every day will go a long way over time.
He does not get all that much time to do it. “I’m on stage for nine minutes, twice, if I do it right,” he said.
Hip Money has already made it pretty far.
Zmarzly learned in January that his application was chosen from hundreds submitted to the SXSW Accelerator Pitch Event, and the app is one of five finalists in the financial technology category. He's one of several Lincoln residents going to Austin during the arts and tech festival's first weekend to talk business.
With Hip Money, users link their checking account info to the app and enter a collection of goals to save for -- retirement, paying off student loan debt, taking a Caribbean vacation, etc. -- and the app offers a daily recommended dollar figure to put away based on money coming in and going out of your account. The dollar figure, say $5.55, includes future value estimates if that cash gets kicked a little or a lot down the road. Accrue interest for a few months and it’d be worth an estimated $5.89 by the time the vacation rolls around or $67.91 by the time a millennial-aged user is ready to retire.
The goal with the app, Zmarzly said, is to offer easy-to-understand and easy-to-act-upon financial advice at a time when, according to a recent Federal Reserve study, 46 percent of all American adults would be challenged to cover an unexpected $400 expense.
“We know there’s a problem, because they’re not saving money,” Zmarzly said.
But not many people want to sit through a six-hour financial planning session to figure out how to do it, he said.
“Most people dread the idea of talking about money,” Zmarzly said. “Money is one of those taboo topics, especially in the Midwest.”
Zmarzly, who worked in the financial services industry for a decade before founding the startup Hip Pocket, admits to being an outlier there. (He's the kind of person who reads a book on selling a house without a broker, and then does it.)
This wasn’t exactly the plan. He got his Master of Arts in creative writing at the University of Nebraska-Lincoln and got a copywriting job crafting the mailers that banks send to prospective customers. As he read the rates a bank was offering on a savings program, he investigated his own financial outlook. He was accruing next to nothing, and nobody at his bank was alerting him to it until he went in for a face-to-face discussion about it.
“What we should be asking ourselves as a (financial technology) industry is where is the tech that gets the average user 90 percent of the benefit with only 10 percent of the effort?” Zmarzly wrote on his website, thefutureoffinancialservices.com. “If the smartest banker is in your pocket (your phone), then why do today’s banking apps merely help to deposit checks and transfer funds? Where is my consultative financial best friend app for life’s most important decisions?”
Hip Money was designed with ease in mind, Zmarzly said. To save that $5.55 for the day, the user swipes right across the screen, same as with a dating app like Tinder.
Chris Valentine, who has been the SXSW Accelerator Pitch Event manager since it began nine years ago, said that, when he first saw the Hip Money application, he considered how millennials are and aren’t spending their money. They’re trending away from ownership of things -- from cars and homes to CDs and DVDs -- and gravitating toward “experiential” purchases, he said. Trips, rentals, rides.
That Zmarzly is based in Lincoln, rather than San Francisco, Austin or New York, was an added bonus to Valentine, who set out years ago to make the pitch event more inclusive to startup founders across the map. (Sixteen of the 50 startup companies presenting at SXSW aren’t from the U.S.)
That doesn’t mean Hip Money was picked simply because it was based here. Valentine knew where the SXSW applicants were based, but the 95 members of an advisory board who reviewed and selected the finalists in each of the categories were blinded to the companies’ locations. They didn’t know if Zmarzly was based in Lincoln or Lisbon.
“The best of the best rise to the top,” Valentine said. “For me, I’m excited to see how this company does. Time will tell how they present onstage.”
Zmarzly said he expects questions about Hip Money's target audience. (The answer is millennials as well as corporations that would provide the app to employees as a wellness benefit. He already has deals with several Lincoln companies interested in doing that.)
This month, Zmarzly has been working with a San Francisco-based consultant provided by SXSW to help distill his pitch into a two-minute presentation that judges will evaluate on creativity, potential, functionality, the team building the app (which includes chief technology officer Ed McKee and Jana Miller, director of client services) and how the product or service improves the world. Then there’s a seven-minute Q&A, which Valentine compared to the interrogation sessions inventors face on “Shark Tank,” and where he said he’s seen CEOs both triumph and collapse when faced with hard questions from judges who are often tech industry titans.
There’s a prize, but not guaranteed funding. That said, the 353 alums of the SXSW Accelerator Pitch Event have gone on to acquire roughly $3.1 billion in funding. The list of past demo-ers includes some now-mammoth tech companies -- social media impact manager Klout, travel service Hipmunk and Siri -- among them.