Lazy Man and Money

Remember BitCoins? They Aren’t Going Away.

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Have you heard of Bitcoins? They are a form of digital currency that have made the news here and there, but hasn’t gone mainstream. However, that might be about to change.

If you aren’t familiar with them, here’s a brief introduction:

In June 2011, I wrote, Bitcoins: The Future of Money or End of the World? There’s no question that there is a brilliant design behind Bitcoins. In fact, the design is so brilliant that despite a few obvious problems, (ahem, liquidity), I couldn’t dismiss them. They truly could be the future of money.

If you read that article and bought some Bitcoins, you could sell them today for a nice profit. However, you would have gone on a roller-coaster ride watching about 80% of your investment disappear along the way. I like to judiciously speculate and even I can’t convince myself to buy them. I tried to the other day, but after they nearly doubled in a few short days due to this Cypress mess, I couldn’t pull the trigger. (Of course, I also like to buy things at a discount, so this sudden raise in rates made it the opposite of the “bargain” that I look for.)

Yesterday Expensify announced that they are officially taking Bitcoin as a reimbursement option for expense reports. This is kind of a big deal, because as corporations start to acknowledge Bitcoins, they become a more legitimate form of currency. So despite what Bloomberg said a week ago about it not being a currency, I wouldn’t bet against it.

I talked with CEO David Barrett of Expensify about their adoption of Bitcoin and why they’ve chosen to support it. If I was a real reporter, you’d probably see a quote here. Instead I’ll just paraphrase how it went, using my own interpretation (not David’s). Reimbursement via direct deposit is great because it only costs Expensify a few cents in transaction fees. Reimbursement to other accounts, such as Paypal are really tough, because Paypal fees eat up 3-5% of the reimbursement. As Expensify deals with more international clients, they have a need for a payment system that A) can meet their needs of servicing many countries and B) can keep the fees low. Bitcoin fits with exactly what Expensify is looking for.

I think many other companies will feel the same. That’s one of the big benefits of Bitcoin. However, again the downside was support for Bitcoin. I asked Barrett about that and he was quick to point out that while Expensify is clearly an early adopter, the path for Bitcoin’s legitimacy is already paved. Companies like CoinLab have been attracting venture capital funding in it’s quest to provide support tools for Bitcoins. Silicon Valley Bank will be holding Bitcoins for CoinLab.

So now it’s time for me to ask the readers? Is it time to start putting some of your money in this extremely speculative currency that may be where the future is going? Let me know if the comments.

[Final Thought that Maybe Only I Find Interesting: I didn’t realize when I was talking with David Barrett that he was the CEO of Expensify. It wasn’t until I read this this article on the Verge (which has the real quote from Barrett) that I learned it. Someone less professional than I would probably do Xander’s imitation of the Snoopy Dance at getting the same level of access to the story as the Verge. Someone more professional than I would probably have not mentioned this…]

What’s Hot and What’s Not from Finovate 2012

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On Monday, I mentioned that I was going to Finovate for the fifth time, but for the first time I had reservations as to whether the event would be worth going to. When I started going, most of the companies were creating products that you, the consumer could sign up and use right away. Every year Mint, Credit Karma, Lending Club, Prosper would show up. There were companies like Wesabe that didn’t make it and companies like Money Strands that are technically still around, but whose blog has one post in the past year and a half. In fact there were so many PFMs (that’s personal finance management software applications) that I just started summarizing them as, “another Mint.”

Last year around half of the companies at Finovate were marketing their products to financial institutions. Their pitch was, “That’s our demo. If you represent a bank, please come to our booth and invest and/or partner with us.” It’s disheartening to see something interesting only to find that I can’t write about it because people can’t use it.

Yesterday I went to the show with SVB from The Digerati Life and watched 32 companies present demos of their products. Only five struck me as being of possible interest to people who aren’t bankers looking to invest in other companies. I never would have imagined I’d long for the days of writing “another Mint” in my notes.

Here’s a countdown of those top 5:

5. Expense and Itinerary Tracking – There were two companies that seemed to do the exact same thing: Concur and Expensify. They take the paper receipts and turn them into digital ones, making the reporting much easier. This year each company added itinerary tracking to their platforms. Concur bought TripIt, a company I had heard of before and Expensify developed their own solution in house.

4. iQuantifi – This company is has four employees and it is just getting started. They are another personal finance management software company (like Mint). What caught my attention is their goal engine. The user creates goals such as buy a new car or buy a new house and the software creates a saving plan for you. You can drag the new car up, but you’ll need to save more and/or push the new house back. It looked like a great visualization and budgeting tool. While the company is in its very earliest stages, it has promise.

3. Personal Capital – They were launching an iPhone application that seems to do everything you’d ever want in a personal finance application. They showed off integration of many bank and investing accounts and the ability to move money between them easily. I would have ranked it higher, but an HTML5 mobile website would have been preferred so that everyone with a smartphone can use the product.

2. WattzOn – Their software analyzes your energy use and gives you tips on saving money. I wrote about this on Monday and one commenter made the point that their software wasn’t very helpful for them. I’m still giving them second place, because the concept is good. Their management is smart, and if their software doesn’t work for everyone now, it should evolve and be a good resource for consumers for years.

1. BillGuard – This company allows people to flag questionable charges in their bills. BillGuard uses this input from many people (crowdsourcing at its finest), and lets you know if you have questionable charges on your bill. They were at the show to announce something even more helpful: a transaction resolution center. They’ll dispute the charges for you. Lazy-approved!

Day 2 of Finovate is going on as I post this. However, SVB and I decided not to go today. It simply didn’t make much sense when a vast majority of the companies don’t apply to your audience. After yesterday, I gett the feeling that we’re just missing 15 more companies who help people send money from one person to another via a mobile app.