So the investor event level 39 Canarywharf was a great setting and was super excited but left a bit deflated with a bit more to be desired.
The Q&A was quite short but appreciate the timings had to be kept with the guest speakers coming into speak.
Met the Man himself and had the chance for a couple of questions but he was a bit more distracted and focussed on his angel investor than a small investor like myself (might I add we small investors make up a large part of your investor pool for your crowdfunding campaigns)
Anyways but as an investor as user as a millennial saver I did feel a bit more to be desired when I asked some of my questions reposting here based on my conversation
- Is Chip making money now/ if not when are we expected to break even ?
Did not get a straight answer so I presume Chip is not making money now as the main revenue stream is expected of targeting the existing user base and convert all of them (hopefully … as the target is to get 500,00 users signed up for Chip by largely just via the existing users bringing in more users and limited or no marketing or TV ads) in to active ChipX users at £3.49/monthly fee.
No update on how many ChipX users does ChIP need to break even on an annual basis. (Note this does create the risk of Chip burning through their investment and go back to the market for additional funding which also dilutes the value of the shares from the crowdcube campaign.)
I also then requested clarification if the products offered in ChipX will beat the market products offered by the highstreet bank and the answer was again vague so at a premium of £3.49 the ChipX products offered are not really guaranteed to be market beating it’s almost a similar approach like moneybox/plum/Wealthsimple that offer putting a portion of your savings away by investing in different funds and share and bonds for X returns with a decent education of how risk of each investment.
While there is no plan in ChipX to risk educate how these financial products are selected by Chip and what risk they carry besides a statement in fine print drafted by their CTO that everyone was proud off. I did mention if Chip can assign a Chip risk category to each financial product within ChipX it would be helpful.
I did also challenge if Chip whole revenue model is only ChipX what is the USP other than ease of use of the app and what is stopping a highstreet bank like HSBC / santander to incorporate something similar on their app - no clear response . Did highlight to the Big Man behind Chip that not exact similar but speaking on the ChipX fee if a Chip user that they will make up their ChipX monthly fee not many users may convert to ChipX users gave the example of a santander 123 account for a £5 monthly fee guarantees you 1% & 2% and 3% returns with no risk and it’s a saver cum current account for me personally and I easily make back my fee I pay to santander not a like for like comparison but it was around the fee and the reward of return …however the Big man of chip And his angel investor insisted the ease Of the Chip platform people will pay for the premium monthly fee(Time will tell and I hope for all of us i am wrong and hope this model is sustainable) Chip on the other hand need to really ensure that ChipX is tempting and rewarding to convert existing chip users to ChipX users or it will be a disaster as when Monzo launches their premium accounts and the shut them down.
The basic Chip saver again with the brilliant AI to assess how much money is saved on a weekly basis is a USP but it would be more brilliant if we are awarded an interest on the savings instead of the referral scheme (now withdrawn but maybe back again in the future)as the sole way of earning something more on your Chip saving is ChipX but it comes with a high risk /reward which is not guaranteed as any financial product investment.