With his last startup Waze — the crowdsourced traffic app recently purchased by Google — Uri Levine wanted to help save you time. But if he’s successful with his latest venture FeeX, he could help save you money.
For the past three months, the Tel Aviv, Israel and (soon-to-be) New York-based startup has been piloting its crowdsourced financial information service in Israel. On Tuesday, it announced that it had raised $3 million in a Series A round from Blumberg Capital. Levine, who is a co-founder and chairman of the startup, personally invested $100,000.
Much like Waze seeks to help people navigate the road by pooling traffic and mapping information, FeeX aims to help consumers dodge excess financial fees by anonymously sharing their financial information.
Users sign up and, without disclosing personally identifiable information, they are prompted to connect their financial accounts — from 401(k) plans to credit cards to mortgages and other financial products. Then the site enables them to see how much they pay in fees compared to other consumers with similar profiles. It helps them understand what they should be paying in fees and how to get cheaper rates, and it even shows users their standing on a “sucker meter” that highlights where they fall on the fee scale relative to their peers.
“Until now, people have been afraid of the financial world,” said CEO and co-founder Yoav Zurel in an interview ahead of the deal. “But the sucker meter is the clearest call to action. No one wants to be called a sucker – and no one should be a sucker.”
The problem, he said, is that because people are so reluctant to talk about their personal finances, financial institutions can easily exploit their asymmetric advantage when it comes to information. The company says that last year, Americans paid $500 billion to $600 billion in financial fees and that a full third of 401(k) savings are lost to fees.
When it launches in the U.S. in a couple of months, FeeX will only offer services related to 401(k)s, but Zurel said it plans to expand beyond that into a broad range of financial products. As it grows, he added, the plan is to remain free to users but ultimately charge small- to medium-sized businesses that want to lower their own fees.
Other startups, like LearnVest and WealthFront, similarly want to give consumers better control of their personal finances. And when it comes to financial intelligence about corporations, StockTwits provide a social network for traders and investors to share information and Estimize crowdsources earnings estimates for stocks.
But FeeX brings a pretty unique community-based personal finance service to consumers. From chatting with Zurel, it sounds like the startup is still very much in an experimental phase, as it figures out consumer behavior when it comes to sharing financial information. But, especially given Levine’s track record building crowdsourced services, this will be an interesting startup to watch.
Image by Alexander Kalina via Shutterstock.