“There’s a metaphor to it,” CEO Pieter Gorsira explains, addressing his startup Lawnmower, and its, by bitcoin industry standards, unconventional name.
If the name Lawnmower at first keeps users at a distance, however, the explanation does much to illuminate the novel concept the Boost VC startup is hoping will help it become a low-risk bitcoin investment solution.
“Working backwards, it’s like we’re running the lawnmower over the grass and we’re clipping off a little bit of change. So, as you go along, we slice all these little blades of grass and collect change from these transactions,” Gorsira continued.
Put more directly, Lawnmower uses an API developed by Spark Capital-backed Plaid to connect to users’ online banking accounts at Bank of America, Chase, Wells Fargo, Citibank and US Bank.
From there, Lawnmower watches its users’ accounts for transactions, rounding up the purchase of say a $ 3.50 latte to $ 4 and saving that 50 cents for later. Once users have accumulated at least $ 4 in total savings through small debit or credit purchases, Lawnmower purchases bitcoin on behalf of the user.
The effect, according to Gorsira, is a solution to bitcoin’s volatility that also allows investors a chance to get exposed to its potential benefits.
“We’re trying to raise consumer awareness about bitcoin and give them an easy way to get in without huge commitment, so you can buy $ 3–$ 4 every couple days instead of buying bitcoin at $ 300 and worrying about where it’s going to go.”
As for whether the name is the best way to communicate these goals, the three-person team (complemented by CTO Patrick Archambeau and CFO Alex Sunnarborg) behind the project is confident it will resonate with consumers, or at least, differentiate it from the competition.
“Having ‘bit’ or ‘chain’ is like an Internet company having the letter E, like E-school.com,” Gorsira added.
The idea that spare change can be converted into investments is not exactly a new one, with the concept already in use by startups like Acorns, an app that has raised $ 9m in funding to allow users to make small-scale investments.
Gorsira acknowledges that he was worried that Lawnmower wouldn’t be first to market with the concept in the bitcoin space, expressing a fear that a company the size of Coinbase could develop a similar app “in a week”.
Still, the team reports that Coinbase isn’t interested in a similar idea for its own, and that to some extent, the company supports the Lawnmower project. “All of the bitcoin is housed on Coinbase, so when you sign up you have to have a Coinbase account that you log in with,” Archambeau clarified.
As for a long-term competitive advantage, Lawnmower’s team sees its product evolving similarly to Acorn’s in terms of the variety of investment options it offers.
“We have a lot of different ideas like putting 20% of the savings into a different currency like litecoin, dogecoin or maybe having a slider that lets you invest 200% of your change into bitcoin,” Gorsira said.
Lawnmower officially opened a beta on 25th March, allowing a small group of users into the program for an initial glimpse. Sign-ups, Archambeau said, are still available.
In part, the team wants to get some fresh air into the room in terms of the ideas that they’re able to generate for the project, so that they can best align the final launch product with informed feedback.
“We need to see what people like or don’t like so we can start adding features. The point is to have users use it, break it and tell us if they like it. [It goes] beyond three people who live in the same room everyday. We get kind of hive-minded,” Gorsira quipped.
As for signing up for the service, beta users will need to have iOS 8 to run the TestFlight application, though Lawnmower is built for iOS 6 and 7 compatibility.
The installation process is simple provided users meet these qualifications, as the app quickly moves through a series of windows that encourage users to connect to their bank and answer security questions necessary to access the accounts.
Over time, Lawnmower sees value in creating a platform that it believes will have a unique set of users among bitcoin companies, especially given that it will in effect monitor the traditional financial behaviors of bitcoin users.
“There’s no company in the bitcoin space that has those ties with fiat,” Gorsira said. “By linking your spending and saving if you will, having information on both the bitcoin and fiat side is a lot more powerful.”
Gorsira described Lawnmower as a bridge between products like Mint and Coinbase, in that it appeals to both sets of distinct users, though he believes the company will likely seek to move beyond bitcoin.
“People are starting to get used to conscious saving. So, [we want to] target those people who are less technical and encourage them to diversify some of their assets,” Gorsira continued, concluding:
“We have a lot longer plans once we acquire a user base.”