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As data-driven technology continues to infiltrate our digital lives, what impact can it have on our money?
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Front (an automated strategy platform for everyday investors) and Katapult (a rental platform with an option to buy for low-credit consumers) operate at different ends of the market, but the two are driven by a passion to give everyone more control over their money. .
Katapult– interest charges
Katapult has identified a clear need in an underserved market and aims to help the 55 million underbanked Americans who, according to the Federal Reserve, made up 22% of U.S. households in 2018. Additionally, only 40% of Americans say that ‘They could pay an unexpected $ 1,000 expense, such as an emergency room bill, car repair, or appliance replacement.
Katapult allows low-income people to afford things like new furniture or electronics, using a clear and easy-to-understand capital lease, eliminating the fear of being penalized for late payments or payments. increasing interest charges.
“Many Americans do not have access to traditional financing options due to a lack of credit or bad credit,” said Orlando Zayas, CEO of Katapult. “Our belief is that you are more than your credit score and that everyone should have access to financing with transparent payment terms. ”
The chaotic markets of the past year inspired the launch of Front, an algorithm-based investment strategy platform to give investors off Wall Street the same level of information to aid in decision making. . Founder Bam Azizi drew on his experience during the 2008 stock market crash to create technology for small investors that gives a personalized risk score for stocks, combining financial valuation metrics with individual preferences and portfolios. current.
The startup has developed a model called FISCO (“Front Investment Score”), which makes investment risk easy to understand by calculating a unique score for each stock. This automates the usual manual process of analyzing a company’s performance, evaluating news for any impact on stock prices, examining financial performance over time, and predicting future changes in value. They then automatically assess the stock’s compatibility with the investor’s current portfolio to give a final percentage score. Their model delivers a result in seconds rather than days. The lengthy manual process can make investors rush into a decision, and Front argues that it allows people to invest with data, not instinct. The app then links the investor to their usual brokerage platforms, like Robinhood and Ameritrade, to buy shares.
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“The pandemic has brought unforeseen circumstances that we have never seen before,” Zayas adds. “Some decisions like remote installation and employee support had to be made quickly during the shutdown, but as we have been going through this pandemic on an ongoing basis, we really listened to understand the situation and the weak points in order to that we know how to solve them.
The Front team has always been distant, dispersed, and got things done virtually. Even in a post-pandemic world, Azizi plans to continue hosting most video call meetings. This saves money and the team can focus more on the things that matter, rather than transportation and logistics.