The Next Generation Social Finance App For GenZ w/ Katrin Kaurov & Aleksandra Medina (Co-Founders)

Hey everyone, thank you for tuning in to the mBit podcast. In today's episode, we have two guests joining us to talk about their startup Fritsch, which is a social finance app for Gen Z. Today, Katrin Kaurov and Alexandra Medina, both are the co-founders of the company with Katrin being the CEO. Quick disclaimer, the podcast is not financial or investment advice and is for informational purposes only. So Katrin and Alexandra, would you mind talking a little bit more about your backgrounds and how you came up with the idea for Fritsch?

Happy to get started. So both me and Aleksandra were living in New York at the time, and both of us had worked and studied across multiple different continents around the world and struggled ourselves with personal finances, both as students and young professionals. And as during COVID all of us had a bunch of free time, we really wanted to build something together. And we were kind of going through different issues that young people are facing in personal finances somehow. Stayed on top of that. And then, you know, as we again had a bunch of free time, we were testing out different available budgeting tools and really didn't like any of them. And that made us think about apps that we did like, which were different fitness tools, whether it was Nike Training Club or Strava or MyFitnessPal, that together we had used religiously for years. And really, really, those things really helped us, you know, shape our fitness journeys and our healthy habits. So we wanted to connect those two together. So bringing in the elements of success from fitness apps to personal finances.

And how did you both meet? I noticed you both went to NYU. Did you meet there? And when did you decide to co-found a company?

Yeah, I mean, I'm happy to say that. So Katrin and I, we met in our first year at NYU. So we actually went to NYU Abu Dhabi, just met there during the first semester. Katrin ended up transferring to another school, but we somehow just ended up being really, really close friends during our travels. And while we were, even though our paths kind of diverged, we kept a lot in touch and we shared those common similarities that Katrin just mentioned, like, you know, how tricky it is to move from place to place, to find and build a new friend group, to sustain that friend group, to figure out how to manage your finances in different countries. And as we went through these processes being students and then obviously graduating and like working, we just kind of like found our way back in New York and then started kind of really doubling down, trying to figure out this problem for ourselves. And I think the catalyst really was COVID because we were kind of bored. There was so much free time. So we're like, okay, like it's now or never.

So Katrin, you talked about how Fritsch is trying to build the social finance app for Gen Z. When did you come across that Gen Z needs some more personal finance help?

I mean, it really was first like looking at our own personal problems, right? Like seeing ourselves and our friends, all of them, like, you know, graduated from some of the best universities and still not knowing like how much should you be budgeting for like dining out or bars, or what are you supposed to be doing with your money in your like early 20s, whether it's at school or when you start your first job. And, you know, just seeing that there weren't any tools out there that were guiding you or that were letting you compare yourself to your community was definitely one of the things that was driving us. And I think, you know, fintech happened to have a moment in time. And also Gen Z as a generation was having a moment in time because I think it was right during COVID or after COVID when the world started to understand that it's, you know, one of the biggest generations out there. And that's really Gen Z is the future and we need to build tools that are relevant to their generation.

And speaking of tools, how does Fritsch help solve that problem with getting Gen Z access to more personal finance tools?

Yeah, so we briefly talked about this before we started the conversation here on the podcast, but the really big differentiator between Gen Z, and I think Gen Z is the first generation that is actually willing to embrace this, is the fact that we are so open talking about our problems because we've seen the world fall apart so many times in front of us. So we're like, okay, Let's just collectively figure out how can we deal with this. And one of the big things that people are so willing to talk about is money, because they've seen their parents, their older siblings, their cousins, whoever go through multiple economic breakdowns, seeing that they can't afford buying a house, they can't afford to have children, they can't afford literally anything even though they work those perfect 9-to-5 jobs that were always kind of set to lead to a very comfortable financial life. So we realized that that was the first thing, like people are really willing to talk about it. And obviously you are trans yourself and assume most of the audience here as well is. You know that what matters for us is community, that we want to have that purpose, we want to have a purpose-driven community. And the big thing that really right now is kind of shining through is the fact that we don't want, we don't trust these traditional institutions to tell us what to do because we've seen in our own lives how people have been following this advice and They're nowhere, their lives just fell apart. So what we want to do instead, and what we've seen in like different other platforms like Discord or wherever else, TikTok, people sharing their ideas of how to like, how to retire by 25. We've seen that we want to find these community leaders and we want to follow their lead and want to see proof of how they got these things. So with Bridge, what we do is that You have your close friends, so you invite your close friends to share your finances with, to have this open conversation, to be a little bit more open. What's your financial situation? What can you, what can't you afford? And then have your larger community. So you have this anonymized group of community where you can see how, for example, an average New Yorker who's in their early 20s, how much do they spend on coffee? Like, how much is it normal for me to spend on coffee? And then I enter this challenge, I see where I benchmark against them, and then I can have my close little community and I can share my daily wins and failures. So you as a close friend of mine can see that, you know, on Tuesday I actually went and I bought that coffee, but within that bigger community, I can see that, okay, but I'm still kind of living up to the expected amount. So I know how to dedicate my budget. And this is how we're starting. We're starting with really figuring out like, how do you set a budget? How do you manage your spendings? And from then, obviously we can go forward and we can start thinking about other avenues of how can you plan your life based on your financial prospects.

And an interesting statistic that I've come across after interviewing quite a bit of SaaS entrepreneurs is less than 25% of people open up an app after the first time. How do you plan to keep getting users back on the app and continuing to use it?

Mm-hmm.

That is a very, very, I mean, that's a painful and true statistic. An app has to give you value. So I mean, there's, there's multiple ways. Like there's one, which is fully just like a product perspective where you just have to figure out a way very, very quickly to convey the value you can give to the user. So from my side of the team, since I lead the whole product team, our big goal in our workload is, you know, how do we give this big aha moment as quickly as possible? Like, how do you make that click in your brain where you're like, oh, now I get it. This is what Fridge does. This is the value that Fridge can get me. And once you figure it out, then you're kind of hooked because you, well, I mean, whether or not you're hooked, the people that will find value in Fritsch will stay because they understand that that's what it does. And if we fail to bring this early enough, then like you said, like 1 out of 4 people will just drop off because they won't figure out what the reason for this app is. And then of course, like from other parts of the company, there's multiple moving blocks, so to say. So, you know, the marketing team is working really hard. You know, we're trying to partner with, vendors that you like, partner with the university so that we're always kind of in the vicinity of your life. We kind of try to make sense to you how Fridge plays a big and lasting role in your life. And then obviously, like you mentioned, social media is such a big thing, so really trying to explain what we do in the most relatable and non-intimidating ways possible over such social media channels as like TikTok.

And since you are partnered with Mastercard, later down the line, do you plan to offer your own debit/credit card that offers incentives that would pair well with your app?

So Mastercard was kind of the first step along our entrepreneurial journey. So right after we put Fridge out there on LinkedIn and like AngelList before we really even knew what we were doing. We got scouted by them and that put us through their accelerator, which was a really intense 12-week program where honestly I feel we like acquired most of our very like kind of sometimes boring, but like really useful knowledge about how to build a company in fintech. So they've been supporting us from day one. That being said, I think debit card is something that can happen down the line, but right now really, really focused on fixing the core problem, which is Fixing people's spending habits, helping them leverage their community to develop better spending habits, whether it's gonna be social life or like bigger goals down the road. So I think that's something we still gotta decide internally.

Gotcha. And being that 34% of Gen Z is learning personal finance through TikTok and YouTube, according to a Yahoo Finance article, how does Fridge plan to take advantage of short-form media to grow their brand?

That's a really, really good question. I would, I, I mean, question and statistic. I would also wanna like follow up with that. I think 70% of those People also say like, yes, that's where I get most of my knowledge from, but I don't really trust these sources. Like I know this is not going to be the thing that's gonna make me be able to retire in a decade. So I think in like a very relatable and again, non-intimidating way, we can just kind of poke fun at you a little bit, right? I think Gen Z is super, super good at making fun of themselves and laughing together about themselves. With their friends. So that's like one thing that we're doing. We are playing a little bit this card of, you know, we're just giving you some tough love. Like we are your relatable and we are your reliable friend. Like imagine if you're like the mom friend of your group was an app, like that's what Fridge wants to be. And in terms of like how can we leverage this content, I think One, obviously our social media is a really, really big tool of how we can acquire users, especially as we grow. But there's also some elements that we can implement inside of the app. So very familiar visual elements and features that you've seen elsewhere. So that, you know, the idea of a finance app that suddenly doesn't sound as intimidating because it looks similar to things that usually bring you positive emotions in your life. So that's actually something we're trying to leverage. So how do we, for example, involve the idea of stories into a finance app. Like how do we involve the feature of liking things and commenting things, and how do we involve chatting and groups and communities? Like how do we do these things so that it reminds you of things that usually give you a little bit of a serotonin boost, so that when you open up a finance app, you don't feel bad about yourself every single time?

For sure. Fintech has been an extremely popular space in the past couple of years. How do you compare to other finance apps like Mint and Intuit?

Yeah, I mean, I would say like the first thing we always say when we would start describing Fridge is that Fridge is not a budgeting tool. We're building a community for Gen Z. I think tools like Mint and Digit and a couple other ones that are out there, I think they were great for millennials and they served kind of the tracking purpose, but Gen Z is not looking for tracking. They want someone to guide them. They want to learn from their community. They want to connect, you know, for a purpose. So I would say we're just playing in two totally different categories and we are building for the new generation.

And speaking of building a community, what do you believe is the number one most important thing to factor in when you're building a community?

It's a billion-dollar question. I mean, I think, listen, there's like so many problems going around now of like, how do you moderate your community? How do you like, how do you balance you being a free platform for everyone versus like making sure no one gets offended, no one gets hurt? So I, I don't know if we figured it out yet, but I think for us really it is to fully understand when you think of your life goals. And that's like another thing that we realize is that, you know, when we think about money, we don't really think like, oh, like in 4 years I want to have $8,328 in my bank account. Like, that's not what you're thinking about. You're thinking, okay, in 3 years I want to have a super nice apartment in West Village. I want to have maybe a car. I want to have XYZ, whatever it is. So that's how we're trying to figure out like these things, like how do people think about details and elements that create a community? Like when you think of your life goals and your financial goals, what are the elements that make you feel similar to someone? And how can we group you with similar people, but then sprinkle in a few aspirational people, so they keep you motivated, so that you can look at them and you can be like, okay, that's my north star. I'm going to follow their lead, they know what they're doing. And really trying to figure out what is that core element that makes you feel like you belong somewhere. So I think the other big things that huge, huge social media networks are, trying to figure out right now. I think it's just the, the pink glasses of like the dating period is over now. You're like, oh my God, social media like really sucks. Like there's so many bad things about it. But for us, like we really just wanted to be anonymized. It's more about your very, very close friends. And then there's this anonymized North Star that you're working towards. So we just have to figure out like, how do we give you this? How do we know that you align with this goal so that we can give you this aspirational thing to live up to?

And earlier you talked about raising capital. You've raised capital from Financial Venture Studio, Antler, and K20. Having this been your first time raising VC, what is your advice to founders in the audience that might be looking to do the same?

I would say a couple of pieces of advice. One would be first, like fundraising is definitely more like a numbers game as well, uh, especially in the very early stages when you just have your vision. So, You know, don't get discouraged if the first 5 people say no, maybe the first like 100 say no, but the 101st investor is gonna say yes and they're gonna be the perfect fit. So I think I didn't know that and we didn't know that this is the norm. So I think that's really important. Then knowing that like confidence really matters, like especially in the early stage, like you probably have no product or users. So it's just kind of your vision that you have to sell and monetize. So it's really like almost like a sales job at the end of the day. And then lastly, I think something we're now figuring out, but in a really positive element, is investors are there with you for the long ride. Maybe it's not as intensive a marriage like co-founders have, but like, it's still— they're going to be really involved probably, you know, for the next 5 years at least. So you want to make smart decisions and see kind of how your relationship plays out before you take a bigger check of money. So they're going to have a bigger ownership in your company.

And to wrap it up here, what are some takeaways about personal finance, and where can people find more about Fridge?

Yeah, I mean, I think what we really, really learned during this journey is actually quite sad. People have a lot less of an idea of what to do than we expected. The very first version of Fridge was basically like kind of free for all. Like we're like, okay, here's all the tools that you can do. Go out there, set your challenges for yourself. And we just saw people being like dumbfounded. They were like, I don't really know, like what's the normal, what do I do? So there was like a kind of like a tough learning and kind of sad to see. But the upside is that we're working together with smart people to create those journeys for you and build those communities for you. So that is like one big learning for personal finances. And I think a lot of times, if anyone out there is trying to build like a finance product, a lot of people are going to tell you like it's an oversaturated market, don't try, like there's already like Mint and Acorns and blah, blah, blah, blah, blah. But the problem is still there, right? Like ask around how many of your friends are in debt, like how many How many of your friends are so nervous if they're going to survive until their next paycheck? That is a sign for you. There's a signal that the problem hasn't been solved. So there needs to be a little bit more creativity there. So it's definitely, if anyone's interested, so much space, so many more problems to solve. So I actually do have a lot of hope. I think the more people think about community and the more people think about like, sharing and like more of like a positive spin. I think there's like some really, really cool products coming out. So I think hopefully it's going to help all of us to become more financially smart. But if you want to download Fridge, we can only do it unfortunately right now on the iOS App Store. So only if you have an iPhone. So just search Fridge. Fridge as in effing rich. That's what the name stands for also. And if you want to find us on our socials, it's Fridge Money.

Got it. Well, I appreciate you both for coming on the podcast. That wraps it up for today's episode. Everyone else in the audience that are interested in checking out Frish, I'll have a link to the app posted in the episode description down below.

Thank you for having us.

Thank you so much for having us.

I appreciate it.