Blackbullion’s Vivi Friedgut Wants to Do for Money What “Sex and the City” Did for Sex
How can we make students and others who are struggling financially think about and use their money like a Wall Street seasoned professional?
Guest writer Dianne See Morrison, a longtime independent tech reporter, co-founder and editor of the Pathfounder, sat down with Vivi Friedgut, founder & CEO of Blackbullion to find the answer.
For nearly a decade Vivi Friedgut, the founder and CEO of Blackbullion, the Hackney, London-based edtech startup has been on a mission to teach university students how to manage their money. But Friedgut, an economist by training and a former wealth manager by profession, is not here to exhort you to cut out your latte habit or to tell you to round up purchases and save the difference, she wants students to think of money the way her former wealthy clients used to. That is, when it comes to finances, Friedgut wants people to think big and to think strategically.
“One of the things you see when you work with a lot of wealthy people is the difference in how they view money and the power of money,” says Friedgut. “They tend to look at money as an opportunity to make more money and to create the impact they want. Wealthy people are a lot less afraid of debt, but they also view debt as a way to build assets. People with less money tend to view debt as a way to just buy stuff, like a holiday.”
Friedgut was also struck by how much emphasis her wealth management clients put on financial education for their family, “Like getting their kids comfortable with what money is and how best to use money,” says Friedgut. “I kept thinking, how can we bring this financial education to the masses? I really wanted to demystify money and make it okay to talk about. Money is such a taboo subject yet rules our lives. I want to do for money what “Sex and the City” did for sex.”
Bringing Financial Education Online: “Netflix, Meets Sesame Street, Meets Wall Street”
The answer came in 2012, as news hit that the outstanding student loan balance in the US had crossed the trillion dollar mark, and university fees in Britain were set to triple that school year. Across the world, it became clear that a shockingly high number of students taking on debt to finance their education didn’t understand how loans work, how they were funded, how they were paid off, or even the impact their debt would have as they embarked on their lives.
And, the problem persists. In the US, the college testing organization ACT recently found that 70 percent of students were unclear that the US government subsidized student loans. In the UK, student accommodation provider Unite Group found that two-fifths of students did not understand how student financing worked.
Friedgut began with face-to-face financial workshops in 2013, and quickly realised she’d have much wider impact and reach if her classes were online. At the same time, she knew the digital version would need to be financially sustainable and give universities a reason to buy the platform. For that, she would build a tool that would manage the financial application process. She went back to her university clients and asked if she built a platform, would they pay for it.
“Three of them said yes, and paid upfront for delivery,” recalls Friedgut. That September, the digital version of Blackbullion was launched.
Today, universities license Blackbullion’s platform to manage the funding applications of students and to give all of their students access to a library of educational content that covers everything from the basics of budgeting and managing money to how the financial industry and economy works. The content is broken into modules, and is a gamified mix of text, video and quizzes, or what Friedgut calls, “Netflix, meets Sesame Street, meets Wall Street.” Some universities require students applying for financial assistance to complete the modules to ensure they know what they are signing up for.
Despite an anxious few weeks at the start of the UK’s lockdown, the pandemic has unfolded to be a “net positive” for the company, according to Friedgut. The initial worry that Blackbullion’s customers - universities - would pull back, proved unfounded. Recently, it signed on Imperial College London, taking its university count to 43, now spread across the UK, Australia and New Zealand, and reaching some 700,000 students. King’s College London, meanwhile, renewed its contract, its fifth year in a row. Revenues from university licences have allowed Blackbullion to bootstrap itself. To date, the company has raised a total funding of £1 million; its last round was a seed raise of £400,000 in 2019.
Lifelong Financial Learning
For Friedgut, the student population is just the start, though it’s clear that the state of global student debt remains an entrenched challenge. Covid-19 has also laid bare the problematic relationship that many consumers - not just young people - have with money and just how many have taken a fingers-crossed approach to personal finances. “There are middle income and high income people who are in financial distress because they don't have an emergency fund because they didn't save. It’s not just young people by any stretch of the imagination who are sticking their heads in the sand about money,” says Friedgut.
In the future, Friedgut notes that every single financial product could be sold with an educational package that allows consumers to better understand what they are buying and the impact to their finances. Pointing to Barclays recent £26 million fine for mistreating business and personal customers who’d fallen behind in loan payments, Friedgut notes, “Financial education is not just a charity issue, but a cold hard strategic one.”
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