Consumer debt is a problem that doesn’t seem to be going anywhere. Over the past few years, the amount of money owed by the average American has continued to increase, with credit card and student loan debt both key factors in this upturn.
Recent Georgia State University graduates Christian Zimmerman and Nate Washington started app-based company Qoins in 2016, with the intention of helping users get out of debt. The app is a debt-payment solution that helps consumers pay off debt faster by automating the process of saving money throughout the month and then making an additional payment to the creditor on their behalf. These payments can accumulate significantly over the course of a year, which has led to strong case studies and a growing positive response among users. Qoins was even recently highlighted on a national level by Forbes, in an article on the market’s leading financial wellness apps.
But the three-year journey from beta testing to industry presence has been far from easy. Because the app involves monetary transactions, Qoins must navigate the often complex web of state and federal regulations that exist within the financial industry.
“It’s been a process,” says Christian, who manages the business side of Qoins, about the challenges they’ve faced. “Neither one of us had experience starting a financial company before. We had a number of issues arise, and for a while we were struggling to figure out how to move forward.”
Thankfully, they found a banking partner who was able to help.
Christian met Atlantic Capital’s Chris Stanley through one of Qoins’ early investors, and in Chris he found the kind of industry expertise and commitment necessary to support the Company’s growth plans. As SVP, Fintech Industry Banking, and with a number of years spent in the startup world, Chris brought immediate insight and solutions for overcoming the difficulties of launching a financially based B2C app.
“Chris put us into an FBO account structure, which has been crucial in maintaining our regulatory compliance,” Christian says. “He helped us change our payment processor, adjust our cost/pricing structure to improve margins on the business model, and fine-tune our long-term product roadmap. All of these things have been immensely valuable to the business as a whole.”
With Chris’s help in streamlining key elements of the company’s financial structure, the future for Qoins looks bright. The company has rolled out new options for saving money within the app, including an algorithm that makes automated withdrawals based on how aggressively the user wants to pay off their debt. They’re also exploring partnerships with larger companies in the consumer debt-management space. And as functionality and user experience improve, the word continues to spread about Qoins and its ability to help consumers improve the health of their finances. But the company’s current position wouldn’t have been possible without first securing compliance expertise.
“The compliance landscape is complex,” Chris says. “A lot of fintech companies, at the early stage, don’t understand it. They’re looking to do whatever they can to prove product-market fit, even though they may not be operating in a fully compliant manner. And this is normal. But at some point, in order to scale you need the right type of partner to help. And that’s what Atlantic Capital can provide.”
As Qoins continues to explore the best possible avenues for growth, Nate and Christian are grateful to have found a way through the initial difficulties that come with starting a fintech business. And they’re looking forward to working with Chris on addressing any issues that might come up along their growth journey.
“We’re glad to be in a position where we are ready to scale for the future,” Nate says. “With Chris, it feels like we have a partner, whereas with our previous bank, it felt like we were just another customer. I can call or even text him if I have questions – and surprisingly enough, that’s not something you get everywhere you go.”
