Author & Audience
Who am I? Who am I writing for?
Who am I?
Hello, my name is Saeid. I am currently a Project Manager in the Oil & Gas industry. I have managed programs and projects in other industries such as non-profit industry, construction, engineering, and the financial sector. I have attended business school for both my undergraduate and graduate degrees. Completing an MBA provided me with the foundational skills needed in trading, investments, asset management, and risk management. While in school, I realized that “money management” is not really taught at schools (not even at business schools!) and is a skill which is learnt through experience. I strongly believe that money management learning experiences should start early for all kids.
Who am I writing for?
The following analyst report was created for the Assignment # 1 in ETEC 522: Ventures in Learning Technology, in UBC’s Master of Educational Tech program. For this report, we will be looking at a digital application called MYDOH, which aims to help kids learn and practice money management, while giving parents transparency and control. The intended audience for this analysis would consist of investment firms, banks, and financial institutions, that are committed to improving personal finance skills and having smarter and more-confident clientele through money management education.
2Ws
What is MYDOH? Why MYDOH?
What is MYDOH?
Mydoh is a money management app designed to help parents help their kids learn money values and skills. The venture was founded by Faria Rahman and Gaurav Kapoor, and supported/developed by RBC Ventures. The founders first met during their MBA at the University of Toronto. Both were passionate about changing the way people think about and deal with money.
Why MYDOH?
While there are plenty of money management apps out there, Mydoh’s Smart Cash Card gives kids the independence that they need and the security that parents are looking for. Kids learn money basics through Play, earn their own money through Tasks, and spend it wisely using their Smart Cash Card, and, it’s all controllable from the Parent Account. Smart Cash Cards are reloadable prepaid cards (not a credit card), kids cannot spend more money than they have.
Literature Review
Problem Identification / Market Gap
Existing literature collectively argues that “the lack of money management among college students represents a major concern” (Knight & Knight, 2000). Additionally, accumulation of financial debt in college students has proven to have one major root cause, “budgeting attitude” (Kidwell & Turrisi, 2004).
Research also reveals that in order to improve the budgeting attitude, educational interventions have been the most effective strategy (Carsky et al., 1984). Having said this, educational interventions have primarily had short-term successes as they fail to intervene when the golden opportunity window is open, during early years of a child’s life (Dandes, 1994).
Danes (1994) studied 182 parents as part of her research regarding family financial information and activity and the results revealed that most parents believe that only around 18 years old, their children are ready for credit experiences (Dandes, 1994). Additionally, the same study showed that parents thought that kids “ages 12 to 14” and “15 to 17” were ready to be involved in family finances” (Dandes, 1994). However, most parents thought children were not ready to establish their own financial credibility or a credit history and build assets until 18 years of age or older (Dandes, 1994). Citing the complexities associated with asset building and money management as the main reasons behind this delayed involvement.
This is where the opportunity lies for the Mydoh app. The controlled and transparent environment of Mydoh enables parents to start an effective money management education early on. The app allows parents to set tasks for children, see how kids are doing with their tasks, and if a job has been completed on time, kids get paid on the Pay Day. In addition to the sense of accomplishment that comes with making an income, children also learn the value of earning money and what goes into it. Task-based pay is separate from any “allowances” that parents can allocate for each kid and is not associated with any task. Allowances are still tracked by Mydoh and provide both the kid and the parent the transparency in how much has been spent by the kid.
SWOT Analysis
MYDOH
SWOT analysis is a compilation of a company's strengths, weaknesses, opportunities, and threats. Investors can use a SWOT analysis before committing to any sort of investments or considering capital spending.
SWOT analysis clearly highlights a company’s internal strengths and external opportunities for investors. Additionally, pairing external threats with internal weaknesses can underline the most serious issues a company faces before actioning capital spending.
MYDOH - SWOT Analysis
Strengths
Lower App fees & pricing compared to industry leaders
High degree of customization and personalization on the Mydoh App
No credit card debt (reloadable Mydoh Smart Card)
Available on both IOS and Android
No bureaucracy between the task-setter (parent) and the user (child)
Increasing number of mobile phone users in children
Weaknesses
No emergency funds available through Mydoh
Mydoh is not available offline
Mydoh does not offer 24/7 customer service (limited to 8am - 4pm)
Opportunities
Personal Financial Software demand projected to increase 5.7% from 2020 to 2027 (compound annual growth rate)
Positive shift/trend in educating kids on money management
No-fee bank account (if continued with RBC)
Partnership with highly regarded and respectable financial institutions
Threats
Strong existing competitors (Mint, Expensify, Mvelopes, etc.)
Possible threat of regulators
Competitor Analysis
With the influx of applications offered on Android and IOS devices, money management apps have gained more traction and major competition has formed. Looking at the data from both the App Store and Google Play, it can be concluded that MYDOH has three (3) major competitors.
The following is a brief synopsis of MYDOH’s competition:
Mint
Mint continues to be one of the most downloaded money management apps (24M users) that is capable of tracking all finances in a single place. This app is considered to be an advance-level tool which can sync credit history to financial goals. Having said this, the application does not have investing features and there is a clear lack of “education” material around managing money, budgeting, etc. Mint is free on trial and then has a $8 monthly fee for access to the full suite of money management features.
Expensify
Expensify with 10 million users is considered one of the major competitors in the industry. Having said this, it appears to be more tailored towards businesses, where users can upload receipts, scan documents, track business expenses, and book travel. Expensify is free to use during the trial period, and the paid version starts at $4.99 per month.
Mvelopes
Mvelopes has over 500,000 downloads on each platform and has a user rating of 4.7 out of 5. Mvelopes mainly focuses on money management by linking bank accounts to the app to ensure personal advice. The services offered fall in different price ranges, however the most basic package starts at $60 per year and the most advanced would costs around $590 per year.
Personal Finance Software Market
Key Highlights:
1) The global personal finance software market size was valued at $1,024.35 million in 2019 and is projected to reach $1,576.86 million by 2027 (Khan et al., 2020)
2) CAGR (Compound annual growth rate) of 5.7% from 2020 to 2027 (Khan, et al., 2020)
3) Region wise, the personal finance software market growth was dominated by North America in 2019 and is expected to retain its position during the forecast period (Khan, et al., 2020)
4) By product type, the mobile-based personal finance software segment is expected to have highest gains rate in revenue by 2027.
As shown on the following charts, both the web-based and mobile-based personal finance applications and software are projected to grow by 2027. Additionally, there is potential at the business level, as well as at the individual (household) level for an influx of demand for such software and apps.
Summary & Recommendations
Mydoh is a practical application that helps parents teach kids money values and skills. Through its unique design, the app establishes memorable and meaningful learning experiences that enforce the importance of personal finance and embeds a positive budgeting behavior. Investors can proceed with capital spending and invest in Mydoh confidently, given that the SWOT Analysis did not reveal any major red flags. Even though fierce competition exists when it comes to money management apps, but the significant majority of the market leaders are advanced-level apps or tailored to small business needs. Clear gap exists for money management apps that are tailored towards kids, and herein lies the opportunity for Mydoh’s investors. Additionally, market research endeavors and literature reviews show that Personal Finance Software Market continues to grow and North America is expected to retain its demand position for the next five (5) years.
References
Carsky, M. L., Lytton, R. H., & McLaughlin, G. W. (1984, April). Changes in consumer competency and attitudes: Do student characteristics make a difference. In Proceedings of the American Council on Consumer Interests, USA (Vol. 30, pp. 166-173).
Danes, S. M. (1994). Parental perceptions of children's financial socialization. Journal of Financial Counseling and Planning, 5, 127-149.
Khan, S., Modi, V., & Kumar, V. (2020). Personal finance software market size, share: Industry growth - 2027. Allied Market Research. Retrieved February 1, 2022, from https://www.alliedmarketresearch.com/personal-finance-software-market
Kidwell, B., & Turrisi, R. (2004). An examination of college student money management tendencies. Journal of Economic Psychology, 25(5), 601–616. https://doi.org/10.1016/s0167-4870(03)00073-4
Knight, L. G., & Knight, R. A. (2000). Counseling clients on credit. Journal of Accountancy, 189(2), 61.
Money management app for Parents & Kids. Mydoh. (2022, February 4). Retrieved February 1, 2022, from https://www.mydoh.ca/