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PCKT Money Plc - Let your own money teach you
There are almost 400,000 people in Finland with a payment default. Invest in PCKT and join us on our mission in educating the next generation - today’s children and youth - to be more responsible spenders and economists of their own lives.
- 27.5.2019: PCKT Money starts co-operation with Rovio Entertainment and launches Angry Birds cards with exclusive rights in Finland and Sweden. Read more (in Finnish HERE.
- 15.5.2019: PCKT’s three pockets - Spending Pocket, Savings Pocket and Investment Pocket - has been developed by Terhi Majasalmi from Vauras Nainen community. All investors investing in PCKT Money will receive a book, “The Schoolkid’s Money Book” (in Finnish), authored by Terhi Majasalmi and Camilla Tuominen. Books will be delivered after the funding round has been closed successfully.
- PCKT Money’s CEO Jaakko Rytsölä was interviewed by Nordnet about families’ finance. You can listen the podcast (in Finnish) here: https://blogi.nordnet.fi/rahapodi-162-vieraana-jaakko-rytsola/?autoplay=1
On a mission to preserve the welfare state
100+ years old Finland is one of the finest success stories in the world. The small northern nation has been able to build itself into a widely admired welfare state. The foundations of the welfare state, however, have started to creak.
We’ve lost some of our global competitiveness. Large age groups are retiring, and our purchasing power has weakened when costs of living have increased.
To overcome the weakened economic situation, we have taken, and are still taking, debt. We owe as state, cities, municipalities, families and citizens. We spend more than we earn. This is a heavy economic and social problem.
Jaakko Rytsölä is known as a man who bought a Lamborghini and lost it. Now, 17 years later, there are almost 400,000 people in Finland with a payment default. This spiral can be cut off by educating the next generation of more responsible spenders.
The welfare state of ours is a unique entity we want to maintain for future generations. However, the current development is making this difficult. We have genuine concerns about the future of our children. We’ve decided to change the course, to work for the preservation and development of the welfare state. We see a new, better-off nation, whose economic skills already acquired as a child allow the welfare state to survive.
We invite all parents to a joint mission. The recipe is simple; together we’ll raise our children to become the financial experts of the future - thoughtfully consuming, goal-oriented new-age citizens.
PCKT helps children to become economists of their own life
PCKT, or "pocket" is a weekly allowance and payment card for children and youth with mobile applications for both the parent and the child. It makes receiving, paying, saving and investing money, monitoring of spending and learning financial skills easier than ever before.
The use of cash is decreasing. In Sweden, researchers have estimated that no cash should be received after March 2023 (Source: Talouselämä 8.10.2017). As physical money disappears, understanding the value of money and teaching your own finances requires new methods.
PCKT is a mutual learning environment for the child and the parent. It allows the child and the parent to see how much money has been spent, what it has been used for, and how much has been saved and possibly invested.
With the help of PCKT, the child learns the value of the money faster, and that all the money does not have to be spent immediately. Part of the money can be put aside for savings or investments. With PCKT, the child learns together with his parents about intelligent use of money, delayed gratification and self-control. Through these skills, we raise the new generation of citizens, economists of their own lives.
Features of PCKT
PCKT is bank-independent, thus suitable for customers of all banks. The parent adds his/her payment card credentials to the mobile application and order the card for the child. In case of multiple children, all cards are controlled by the same parent’s application. The child’s card will be delivered home by post. The parent can transfer money to the child's card via the mobile application, automatically every week or ad hoc when needed. The parent sets the usage limit for the card and will be notified about the purchases made by the child.
According to our research (TNS Gallup 2015, n = 1004), most families use chores around the house, or doing homework, for weekly allowances. With PCKT, parents are able to set tasks for their children and when the task is done, the agreed amount of money is transferred to the child's card.
PCKT is based on three "pockets": the Spending Pocket, the Savings Pocket, and the Investment Pocket. With these pockets, it’s easy to discuss the different ways how money can be used, and to increase the child’s understanding and perseverance.
The Spending Pocket
The money in this pocket, used by the child with his own payment card, is for everyday expenses. The application tells you how much money has come and gone, how much is left and where it has been spent. The parent can receive, if wanted, real-time notifications of all purchase transactions.
The Savings Pocket
The money in the Savings Pocket is for child’s own goals. The child can create his own savings targets and follow up on saving them. Regularity is the key here.
This pocket is for the future, but it’s useful to get familiar with the subject of investing already at a young age. Money in the investment pocket is directed to a bank account chosen by the parents. Repetition helps the child to learn the concept of investing.
PCKT Money Plc has its own Mastercard card license, which is required when issuing Mastercard cards. With the license, the company has the opportunity to make various card programs. The company processes the Mastercard transactions itself in real time. Proprietary payment processing ensures a low cost structure and independence from third-party systems. It also enables fast product development in payments industry in the future. PCKT Money Plc's technical environment is PCI DSS* level 3, which is a prerequisite for safe handling of card data and for joining the international payment system.
*) PCI DSS (Payment Card Industry Data Security Standard) defines a minimum level of technical requirements for card payment security. The standard is managed by an international independent institution, PCI Security Standards Council, founded by Visa International, MasterCard Worldwide, American Express, JCB and Discover Financial Services.
Vår affärs- och marknadssituation
PCKT Money Oyj
PCKT Money Plc is financially sound, profitable company founded in 2003 by the founders and investors. The company is currently owned by its founders and investors. PCKT Money Plc is a registered payment service provider under the supervision of the Financial Supervisory Authority (FIN-FSA) and also has its own Mastercard license. PCKT Money's subsidiaries Devolon Oy and Devolon Oü operate in Finland and Estonia and employ nearly 30 software industry professionals, representing 9 different nationalities.
PCKT Money Oyj is the group's parent company, which is responsible for the PCKT business and owns the rights associated with it (eg brand, technology) in its entirety. Devolon Oy and Devolon Oü are 100% owned subsidiaries of PCKT Money Oyj, and they provide IT consulting services to various companies. Devolon Oy and Devolon Oü are also responsible for the technology development of PCKT. There is an agreement between PCKT Money and Devolon Oy about the development with a 20 000 € monthly fee.
2003 Jaakko Rytsölä establishes the company together with his brother Antti Rytsölä.
2003 - 2006 Neocard develops and launches Neon, a new payment card for young adults, operating in a limited number of stores, mainly in the metropolitan area of Helsinki. The Neo business was discontinued 3 years later because, unlike PCKT, the business model was not scalable.
2007 Neocard delivers loyalty and payment cards for several companies (eg S-Group, Guess, Calvin Klein, Nike, Primula)
2014 Company establishes a subsidiary in Tartu, Estonia.
2016 Development of PCKT concept begins. The company receives a full Mastercard license and registers itself in the Financial Supervisory Authority (FIN-FSA) as a payment service provider.
VAT registered business is extracted into a new company, Devolon Oy, which continues to develop loyalty and payment cards as a consultant for other companies. Parent company PCKT Money Oyj focuses on PCKT business.
2018 PCKT focuses on brand building. The mobile application and cards launched for test users in May 2018. Building of the product features and other business development.
2019 The PCKT mobile application was released in application stores at the end of March 2019.
Only about 10% of Finns use cash (Source: Suomen Pankki / Yle 30.10.2018). The decrease in cash use has led to a lack of understanding of the value of money. There’s also a lack of financial education. According to our study with TNS Gallup (2015, n = 1004), as many as 84% of parents feel that financial skills, e.g. own income and expenditure management, should be taught more in schools.
The primary target group for PCKT are families with school aged children. In 2017, for example, there were 489,133 children in Finland aged 7-15 (Source: Statistics Finland). In Europe, the figure is about 75 million children (Source: Eurostat). PCKT cards are technically parent's parallel cards, so there is no actual age limit for the PCKT card holder. Secondary target groups are families with children of other ages as well as families with a need for a payment card and the associated mobile application (eg people with guardians).
Most families give their children weekly allowance, either in cash or in the child's own bank account. The solution traditional banks offer is typically the use of bank account and the associated Electron card, which does not allow saving, investing and creating goals as easily as PCKT. In addition, money transfers require a visit to the online bank. Most children also get money from grandparents and relatives. Some of the money goes to funds and bank accounts that children have no visibility to.
These factors create a business opportunity for PCKT, who is able to offer a better solution as an agile and bank-independent operator. The new PSD2 Payment Services Directive will further increase the business opportunities of PCKT.
The main competitors of PCKT are cash, that some families still use, and the bank account + Electron card solutions offered by traditional banks. Traditional banks have been passive and slow to develop - and above all to actively market - agile financial technology services. Also, new operators are not expected to enter the market at a fast pace, as market entry requires registration to the Financial Supervisory Authority and substantial investments in technology.
Our major competitor in the international market is UK-based GoHenry, which is primarily active on the UK and US markets. In the autumn of 2018, GoHenry, according to its own estimate, had a 5% market share in the UK (source: GoHenry Finance Round Materials, Crowdcube). One of the competitors in Finland is the DanskeBank MunRahat service, which does not have similar features, such as savings or goals, as PCKT.
PCKT was released in mobile application stores in end of March, 2019. The strategy is to grow rapidly in Finland by investing heavily in customer acquisition. According to PCKT Money's plan, Finnish business is estimated to be, with the minimum level of funding (€ 400,000), profitable in July-August 2020. Preparations for internationalization into the other Nordic countries and Central Europe will start immediately after this funding round.
PCKT's scalable technology and the EEA-wide Mastercard license allow fast and cost-effective opening of new markets. Customer acquisition is based on strong PR and communication, digital marketing, influencer and referral marketing and marketing with locally selected partners (eg media companies, junior sports clubs).
PCKT’s business model consists of a 5€ opening fee and a 3€ monthly fee per payment card. Additional revenue is generated e.g. by new card orders in place of lost cards. In addition, a number of additional features, that will further increase the customer lifetime value (LTV), are on the roadmap.
Competitive advantages - why to invest
- The product is ready and the biggest investments in technology have already been made by PCKT Money Plc
- Team with over 15 years of experience in financial technology (FinTech)
- FinTech is one of the most interesting technology industries with a clear exit market
- Technology and business model that can be scaled fast and cost-effectively
- Provides a bank-independent, easy-to-use solution to a universal problem - learning the value of money
- The stable and cash flow positive business of 100% owned subsidiary of Devolon Oy secures the overall business of PCKT Money Group and provides sufficient resources for the further development of PCKT and new products.
Value creation and exit strategy
In this funding round the potential exit options for a prospective investor consist of future financial rounds, trade sale or listing on a stock exchange. PCKT Money works in the desired FinTech (Finance Technology) sector, where market entry is difficult due to technology, regulation and capital requirements. PCKT Money's Board of Directors has set a target for the company to operate with the PCKT business in all the Nordic countries and in a few selected Central European markets in 2025, when the company's target revenue would be over EUR 40 million and EBITDA nearly EUR 15 million. To achieve this goal, the company may need additional rounds of funding. Future rounds of financing have not yet been decided. This round of financing is estimated to be sufficient to make the company's business profitable in Finland.
Financial Technology (fintech) is an industry that has interested investors and industrial buyers. For example, our UK-competitor GoHenry's last funding round was £ 58m (pre-money) in autumn 2018, with 550,000 users (330,000 children, 226,000 parents) in the UK and the US. Their previous funding rounds were pre-valued £ 36m (November 2017) and £ 21m (March 2016).
The company has an experienced team, who has been or will be engaged with ownership or option program. The company's board has an extensive experience on entrepreneurship, legal, international business, sales and marketing. The registration request of the new board presented below has been sent to the Finnish Patent and Registration Office (PRH).
CEO, board member
Jaakko, who founded his first company at the age of 14, is an experienced entrepreneur. When others see opportunities, Jaakko has already developed a solution for the opportunity. Jaakko acts as the CEO of PCKT Money with full responsibility of the business.https://www.linkedin.com/in/jaakkorytsola/
Account Service Manager
Perttu is the company's contact person for the Financial Supervisory Authority and is responsible for the anti-money laundering and counter terrorist financing measures. Perttu holds a Master's degree in Political Science and has worked as a journalist and in various positions in business.https://www.linkedin.com/in/perttur/
Priit, PCKT’s Chief Technology Officer, joined Devolon in 2016 and has since been involved in growing the company from a 3-person nerd workshop to a 24-person information technology service company.https://www.linkedin.com/in/priitpihus/
Lauri Lani acts as a contact person for Mastercard and is responsible for payment transactions control.https://www.linkedin.com/in/lauri-lani-539660165/
Chief Program Manager
Louise is the Head of Product Development at PCKT. Louise is a passionate, proactive and result-oriented web and software and digital marketing professional with over 15 years of experience in managing demanding technology projects.https://www.linkedin.com/in/louisewatt/
Tulos Helsinki Oy
Tulos Helsinki, a specialist in digital marketing, is PCKT’s outsourced marketing team responsible for all digital marketing activities, such as analytics, display and search engine advertising, email marketing and social media community management.http://www.tulos.fi
Chairman of the board, HHJⓇ
Jari is the CEO of Visionplus Oyj, a venture capital firm, with extensive experience in entrepreneurship, business development, corporate acquisitions and venture capital investment. Jari is the Chairman of the Board and the largest shareholder of First North listed Avidly Plc. In addition to PCKT Money, Jari is a board member or chairman of several other growth companies such as Transfluent Ltd, Bonusway Ltd, TLD Registry Ltd and Solar Foods Ltd. Visionplus Fund I Ky is not an investor in PCKT Money Plc.https://www.linkedin.com/in/jarituovinen/
Member of the board
Antti has over 18 years of extensive experience in strategic marketing. For the past 4 years, Antti has been an entrepreneur, helping many growth companies in their marketing challenges. Before becoming an entrepreneur, Antti worked as the Chief Strategy Officer at Dentsu Aegis Network, whose clients include a number of the world's largest advertisers. At the moment, Antti also acts as a consultant at Invesdor (CMO, interim). Antti is not currently a shareholder in PCKT Money, but is going to invest in it during this funding round.https://www.linkedin.com/in/anttikaihlanen/
Member of the board
Tuomas has extensive business, sales and marketing expertise. Currently Tuomas is an entrepreneur and investor. At PCKT Money, Tuomas has been an investor and member of the Board since 2003.https://www.linkedin.com/in/tuomastorkkomaki/
Board member, lawyer
Jaakko is a lawyer who has been a member of PCKT Money's Board of Directors since 2004. Jaakko has more than 30 years of experience in tax law, banking law and M&A.
Member of the board, HHJⓇ
Joni Alasaari is the main owner and chairman of the board of Janneniska Ltd, a leading Nordic truck leasing company. Janneniska Ltd is the main owner of Bladefence Ltd, a company specializing in windmill repair in Europe and North America. Joni brings international business expertise to the board of PCKT Money.
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Success of the concept
Although the PCKT concept has been tested to be functional, every business always has some sort of risk of the concept's success in the future.
Our team consists of committed individuals with solid experience in various payment cards and mobile applications as well as entrepreneurship. All members of the team are owners of the company, or are subsequently tied to a separate stock option program. Marketing and customer resource allocation has been outsourced mainly to Tulos Helsinki Oy, which reduces dependence on individuals. Losing a key person or partner might make company's business more difficult. The processes of the company are to be designed in a way that these type of harms are minimised.
In the company, the financial risk is primarily related to the availability of financing and liquidity. The business of PCKT Money's subsidiary, Devolon Oy, is already stable and cash-flow positive when the resources devoted to the development of PCKT are not taken into account.
Risks related to financial forecasts
The forecasts and future plans presented are somewhat uncertain, and if the targets are not reached, this can have a negative impact on the company's performance and investment value. PCKT's economic forecasts are based on metrics (customer acquisition cost CAC, customer lifecycle value LTV) set at a very realistic level by seeking comparative information on similar services on the market.