The use of credit cards has grown exponentially since their inception in the 1970’s. While our consumption-driven economy has allowed us to grow to new economic heights, our reliance on credit has left us stuck with bad financial habits. More Americans are now more in debt than ever with no way out of their financial hole. Debt is so pervasive in our society that Pizza companies offer a “buy now, pay later” option for ordering via their online checkout. Frida Leibowitz, Rachel Lauren and Maxime Fourmault help Americans reduce their dependency on credit with Debbie before they financially overdose. Debbie is a “habit-changing rewards platform” that uses behavioral psychology to create financial products that guide users out of debt and into a healthier financial future. The Miami, Florida-based startup has raised $1.2 million from One Way Ventures, BDMI, TA Ventures, Village Global, Green Egg Ventures, Liquid2 Ventures, If Then Ventures, Dipanjan Bhattacharjee, and several other angel investors.
Adam Moelis, co-founder of Yotta and angel investor at Debbie, says: “Many FinTech apps now offer financial wellness tools, but they often focus on short-lived relief rather than building long-term financial habits. Debbie uses behavioral concepts to create a personalised, engaging and accessible path to debt freedom for those struggling in a perpetual cycle of debt, greatly increasing their chances of long-term success.”
Dipanjan Bhattacharjee, COO of Nirvana and Angel Investor at Debbie, explains: “I’ve known Frida for years and have seen how smart and passionate she can get things done. I was very impressed with Debbie’s vision and the way Frida and Rachel wanted to challenge the status quo of debt consolidation loan offerings. The rare combination of relevant experience, the right skills and a willingness to do anything convinced me to invest and help where I could.”
America’s addiction to debt has only gotten worse over time. As a consumer who is constantly advertised throughout the day, the temptation to spend only grows proportionately. Credit cards are incredibly useful for bridging the gap when you’re struggling with cash or wanting to earn reward points, but they’re a double-edged sword once the bill comes due. Many Americans have a balance each month, which puts them in a worse position due to exorbitant credit card interest rates. (There’s also the common financial misconception that it’s better to have a balance in order to improve your credit score, which isn’t true. You should aim to pay off your balance every month!) Healthy credit card usage is critical to high Creditworthiness, which can affect your ability to access loans for a car or home, and even whether or not a potential employer will hire you. As the use of American credit cards increases for the worse, there is a lucrative market for helping Americans get out of debt.
consumer credit card debt $841 billion in the first quarter of 2022. With such massive debt, every user is unlikely to be able to repay their balance immediately. Payday loan companies take advantage of individuals and families in financial distress by lending them money at rates that would make credit card companies blush sometimes over 600%. The stigma of bearing debt can psychologically debilitate someone to such an extent that they begin to fail to be a functioning member of society. Leibowitz, Lauren and Fourmault are able to intervene with Debbie before it’s too late for individuals and families in debt.
Debbie provides its users with a debt payoff rewards platform and puts them on the right path to positive net worth and cash flow. The startup encourages positive and constructive behavior with financial incentives for users to build good financial habits. The founders believe that the technical implementation of their solution is simple; The real difficulty, however, is understanding users’ relationship and habits with money and integrating those lessons into the core of Debbie’s platform. Debbie relies on cognitive behavioral therapy and behavioral psychology to help users gain insight into the drivers behind their spending habits. By bringing these insights into spending habits through the app to the forefront of a user’s attention, the startup is able to design real-time reward actions to incrementally change the donor’s behavior.
The startup’s current offering puts it on track to offer future products and services that incentivize simultaneous debt payoff and savings, and more importantly, help users build long-term wealth through home ownership, investing, and retirement. In relation to loans in particular, the data Debbie collects can provide a more dynamic, real-time perspective of the credit card user, which can be helpful for lenders in deciding who to approve loans to in the form of mortgages or other lending products. Leibowitz herself was previously heavily in debt, both individually and with her family. As much as she builds a product for people other than her customers, she is building a tool that she and her family will want as they navigate America financially. Thankfully, her partnership with her co-founders is making Debbie’s massive potential impact ever more of a reality with each passing day.
CEO Leibowitz explains, “I grew up in an immigrant family with no college degrees, no access to financial education and always struggled with debt. As an adult, I fell into the same debt trap and by the age of 21 had accumulated $15,000 in credit card debt. Hoping to make a difference for others, I spent my early career days in the digital consumer lending business and had the unique opportunity to sit in the seats of borrower and lender at the same time. I became increasingly frustrated that our current financial system quickly throws us down when we misbehave but doesn’t celebrate our achievements well enough.”
Leibowitz leads the founding trio as CEO. She graduated from NYU’s Stern School of Business with degrees in business administration and political economy, and was previously a member of the core team at Goldman Sachs Credit Risk and Product, where she worked on the company’s growing consumer credit card product, Marcus. Lauren, Debbie’s COO, earned her degrees in business administration and political economy from NYU’s Stern School of Business and previously worked as a venture capitalist at BDMI and conducted equity research at Credit Suisse. The team is rounded off by Fourmault, who is educated at the Ecole Privée des Sciences Informatiques (EPSI). A computer major, he previously worked at Earnest as an engineering manager and has entrepreneurial experience. These three combine their extensive financial experience and temper it with a healthy respect for mental health as entrepreneurs. Together they will lift Americans and their families out of debt and create prosperity for generations to come.