New fintech startup PrizePool, which mixes on-line banking with a month-to-month sweepstake designed to incentivize private financial savings, has picked up $4.25 million in seed funding.
“It is a new approach to economize, and hopefully incentivize of us to economize, for these sudden bills,” CEO and co-founder Frank Chien instructed Cheddar.
PrizePool will assure $50,000 worth of prizes every month, together with at the very least one $25,000 sum given out to a single winner. The remainder of the prizes start at $2 and go up.
“The way in which you enter is just by saving cash,” Chien stated.
The entrepreneur confused that consumer deposits might be held by Evolve Bank & Belief, a business bank with a footprint in Arkansas and Tennessee.
“So your cash is FDIC insured and risk-free fully,” he stated. “We really run your complete program underneath sweepstakes regulation, so we’re fully compliant and eligible in all 50 states.”
The startup can be selling how customers can additional incentivize one another to avoid wasting via a system that rewards referrals with a 10 p.c bonus on the brand new consumer’s winnings.
“We’re making financial savings a extra shared expertise,” Chien stated. “Each pal or member of the family that discuss with PrizePool provides you extra possibilities to win.”
The seed funding will assist PrizePool develop its software program and pay for a advertising push, he stated.
LearnSprout seems to have since been absorbed into the bigger firm.