Stage: Revenue generating
Number of employees: 1-5
Short URL: vator.co/allowancetree
On AllowanceTree, kids and teenagers manage and grow their real money in a fun, interactive, and parent supervised platform that mirrors the real world. They learn financial literacy and healthy money habits by doing, with their own money. They can save, invest (in their grades), give charity, diversify, take out loans (from their parents) and learn to avoid debt. Ages 9-17.
This product is a much needed and timely solution to the prevailing problem of financial illiteracy. Everyone seems to agree that if children were taught finance in a stimulating, technologically exciting environment, where they could learn to succeed and fail under controlled circumstances, they would grow up far better equipped to deal with the financial stresses that life entails. Our hope is that this product will help spare the current generation of youth from the sometimes catastrophic consequences and burdens that financial illiteracy has placed on the lives, marriages and happiness of their parents' generation.
AllowanceTree's business model consists of three revenue streams:
AllowanceTree.com has four major advantages:
Are there other websites like AllowanceTree?
While there are a few websites geared towards teaching kids financial literacy, they tend to target pre-teens primarily, and with a more video game-type flavor. AllowanceTree not only targets middle school and high school age students, it was designed by educators, around specific educational processes, to mirror the real world of finance. As a result, none of the other sites feature the functionality that AllowanceTree has developed, such as our Stock Market, Loans, or Credit Score modules.
What is the marketing strategy?
The AllowanceTree site has just entered its live beta phase. Our initial marketing plan involves donating a fixed number (ex. 50) of free memberships to churches and other institutions in order to get a base of initial users to prove and improve the concept.
We are currently working on developing a strategic relationship with a large financial planning house to have our product bundled into their existing services as a value-add.
After our beta launch, we will involve a broader medium of distribution centered around top-down approaches, ex: talk radio host-read commercials, in order to reach a large audience in the most cost-effective way in order to prove the subscription model and test market engagement.
We will also approach educational institutions to establish the best means of getting the product into their communities, whether by offering free membership to specific economics classes within the school, or whether by approaching the administration or PTSO organizations directly.
We will concurrently be pursuing press and blog coverage in order to raise awareness of the site.
All initial revenues will be redirected into marketing efforts.
Does AllowanceTree involve real money?
AllowanceTree represents the real money that parents give their children. The system automatically tracks monthly deposits, and allows children to use and manage their money online. Parents do not deposit real funds online, but they are responsible for holding their children's money so it is available when their children want to use it.