Looks like Loot’s fundraise is off, although Loot’s website still seem to be promoting it for some reason. On the other hand Seedrs have taken down the pre-registration page.
Wow, did not see that coming. I had pre-registered for early access to Loot - lucky escape for me I guess!
I was just discussing Loot with @simran last night as part of a “Fintech bubble” with so many apps with seemingly no new innovation between them. Glad no one got burned by this.
I wonder what their burn rate was - supposedly RBS had a 25% stake via their digital bank Bò for a £2M investment made in January.
Wow! - totally shocked by this - not so much as in I know and value the product at all but more so just on how much they spent on advertising the Seedr’s crowdfunding with Tube poster adverts!.. maybe it was just that they happened to focus on my commute but at london bridge and along northern line I saw loads of adverts pushing for the promotion of the Seedrs crowdfunding
Just checked and there is 0 other sources or references to Loot going into administration other than this single tweet… (im happy to be corrected) but think we need to be careful about fake news and rumours…
There’s a TechCrunch story confirming the news -
I noticed that as well but then Seedrs confirmed it with their Tweet, and by taking down the pre-register page. This was meant to be a big campaign for Seedrs, they had banners running on the site for a while now.
Thanks for confirming! - didnt want Freetrade getting cited as the source of a fake news story that caused a company problems… - its awful that they havent done anything to update the homepage!
Founded in 2014 by now 25 year old Ollie Purdue as he was finishing up university, Loot offers a digital-only current account aimed at students and millennials, and has around 250,000 registered accounts.
What’s happened is horrible for the people working at Loot. But putting that aside I find it impressive how a university student was driven enough to launch a financial service, then build it up to something that looks like it was in a decent state with 250k accounts.
I’m not surprised. They’re competing with Monzo, Starling and Revolut. Why use loot when you can have an account that does a lot more?
I think they actually did a great job targeting the student market and providing a high degree of ‘educational’ material advising people on how to save/earn etc… from what i know of them anyways…
My rule of thumb is, if an early stage FinTech pays for very expensive above the line traditional advertising like the Tube, then generally they are either desperate or in dire straits, or both.
Only larger FinTech like Starling can sustain the cost burden of such ATL advertising and even there it reeks of desperation as they have fallen behind user numbers compared to Monzo and Revolut.
They had a very niche spot targeting students but I think this raise was part of a plan to broaden their scope but was not meant to be but does show the market is there for the taking with 250k users now looking for an alternative!
Were they weekly active users though?
Apart from the ATM fee I can’t see how they would have made money
The only ones for whom this market is for the taking are the likes of Monzo, Starling, etc. Other than perhaps some educational needs, which is easily copyable and thus not provide sustainable competitive advantage, banking needs of students are not really different from your average millennial. Their jobs to be done are the same.
The idea that various segments of the population have very different banking needs is a fallacy, perhaps with the exception of kids (who GoHenry target) and maybe elderly people.
Loot was imply too late to the party and didn’t differentiate sufficiently. I can see Dozens go the same way in a few years.
I think in terms of budgeting needs I have to disagree… I think students do need a more tailored budgeting experience given the unique way in which they obtain income (loans… Termly) but have to manage outgoings in a more standard monthly cycle… Also, you capture a customer at the early stage of being a student and you tend to be able to keep them for a longer period…
If you put your loan in a separate account & then transfer it into your current account on a monthly basis (which is probably not a bad way to manage your money), then most of the challenger bank’s apps budgeting functionality should work for you.
My observation has been that this has traditionally been because banks lure students in with zero interest overdrafts or freebies & suck them into debt that they can’t afford to pay off which means that they have to stay with the same bank. The challenger banks are a little bit more ethical so they don’t do that sort of thing.
Or just put it in a pot in the Monzo account
Indeed, and even if the budgeting functionality of Monzo and the likes isn’t sufficient, you can just layer Emma or Yolt on top of whatever account you have. I really can’t see any need for a student niche bank.