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Financial Software - Thursday, September 11, 2008

The Sweet Smell of Profits With Mint

While many traders found some comfort with the market's modest gain, the staff at tech:stocker is still not sold on most of the financial stocks. Any company that relies on mortgages for profits or is still holding a substantial amount of asset-backed securities is hard for us to recommend. After Bank of America (BAC:NYSE) reports its third quarter earnings and the next wave of bad mortgages crashes, we might be ready to jump on board and might even consider boarding the Wells Fargo (WFC:NYSE) stage coach. Even though there might be hope for some of the big banks in the near future, we're still happy to be focusing on TechCrunch 50 for one more day.

After spending a few days at TC 50, we didn't walk away with the feeling that we would be seeing many of these companies a year from now, let alone as a listing on NASDAQ. To be fair we enjoyed the light presentation from the attractive co-founders of Mixxtt. Initially we thought the two girls were more interested in meeting rich VCs to obtain a ring versus a check, but once they fielded a few questions about their business model, we realized they were serious. While a Web site focused on helping people meet other people founded by a couple of frustrated Match.com users will be hard pressed to get users, if they can generate a strong user base they might be able to make it.

But the point of today's column is to discuss the company we liked the best at TC 50. And that company is Mint. When the worst thing you can say about a young company is that having mint leaves with a dollar sign is a weak logo, you know they have a good service. We liked Mint so much after having the CEO run through a demo, we signed up for the service.

Mint is the first site we've seen that not only organizes all of your finances in one place, it actually provides you with advice based on how you spend your money. Do you carry a balance on your credit cards? Mint will recommend cards with lower rates if possible. While this is nice, we ultimately like the fact that Mint organizes all of your accounts. At one time we had accounts at Fidelity Investments, Charles Schwab (SCHW:NYSE), Washington Mutual (WM:NYSE), Bank of America (BAC:NYSE), Merrill Lynch (MER:NYSE) and E*Trade (ETFC:NASDAQ). Would this be problem for Mint? Of course not. Mint has working relations with over 7,000 financial institutions. While most people don't have accounts with 7 financial institutions before credit cards, many have IRAs, 401ks and brokerage accounts at companies that do not service their checking account.

And the best part about Mint? It's free. While the chief marketing officer we spoke with briefly hinted at premium services in the future (in between disparaging remarks about the financial services industry and their lack of innovation), CEO Aaron Patzer didn't hint at anything of the sort. Mint is perfectly content to make money if you accept one of their sponsored recommendations for a credit card or brokerage account. Before you go crying "foul", Mint does not push its sponsor companies. Mr. Patzer insists they are ultimately about providing the best financial advice. Instead, Mint will be launching a tool later this year that will break down a customer's investments by asset class. This will be extremely helpful for active traders who don't want to duplicate the efforts of there 401k or IRAs.

And we're not the only ones who like Mint. Since their launch at TC 40 last year (and winning "best in show" or whatever TC 40 calls the award), Mint has developed over 420,000 customers. After hearing this number, we couldn't help but wonder why they were even bothering to exhibit at TC 50. A great service like this would be far better served on strategic press tours and innovative events aimed at acquiring more users.

While Mr. Patzer referred to Mint as a financial advisor, ultimately the site doesn't offer investment advice. While they do offer some pithy advice that is aimed at people who do not understand the term "mutual fund", let alone, "small cap".

From an investment standpoint, we don't see Mint as an acquisition target as the industry is moving towards a holistic approach of offering everything you need. There's no way Bank of America would want to purchase a site that would steer customers away from their high interest rate credit cards. Because of this, Mint might be forced into going the IPO route to reward its investors. But if Mint continues its rate of growth and takes its marketing activities to the next level, we expect the next time we write about Mint it will be a public company.

View - mint.com