The Miami-based personal finance startup plans to publicly launch its free AI-powered app for consumers later this year
America is in a credit card debt crisis. The average American carries nearly $6,200 in credit card debt, the highest ever, and one out of every three adults has a debt in collections. It’s a problem that has impacted tens of millions of families, compounded by the pandemic.
The founders of a Miami-based startup, Relief, are on a mission to lift people out of this crippling credit card debt by negotiating with companies on their behalf. Their app uses AI and collective bargaining to reduce balances and help users become debt free faster. The app’s technology automatically analyzes a user’s personal finances, negotiates directly with creditors and then sends the consumer a payment schedule based on what the user can actually afford.
The founders say the app can cut credit card debt in half or more on behalf of the consumer — for free.
Relief already has a waiting list of consumers with a cumulative $750 million in card debt. Now with a new round of funding, Relief can further strengthen the platform to support the rapidly growing wait list and launch the app to the public later this year.
Relief announced today it has raised a $15 million Series A round, bringing total funding to $17 million. The round was led by Nava Ventures, a relatively new venture firm with investments across consumer, enterprise, and frontier technology. Participating in the round: A former CEO and chairman of American Express, Ken Chenault, and a former CEO of Citigroup, Vikram Pandit, as well as Interplay, Animal Capital, Necessary Ventures and Brand Foundry Ventures, among others.
“The company’s deep founder-market-fit is a hallmark of Nava’s investment thesis, and Relief’s consumer-first approach is a much-needed innovation in the debt settlement industry. We see Relief as a long-term partner for consumers looking to improve their financial well-being,” said Nava Partner Freddie Martignetti in a statement.
Relief’s team has been working on this problem for three years, said CEO Jason Saltzman, the CEO, in an interview with Refresh Miami. He co-founded the company with Bryan Okeke and Ram Berrouet (pictured above).
“Relief is a free app for people that are struggling with toxic credit card debt. It uses machine learning and AI to negotiate down people’s debt,” Saltzman explained. “And on the other side, it will actually lend capital to lower interest rates for people that are making payments on time or have a little bit better credit. So essentially, it does those two things to get people out of that. It’s an end-to-end solution, it’s completely automated, and it’s completely free to use.”
Saltzman is a 20-year entrepreneurial veteran who has built and sold companies, including in the debt settlement space. But he hated the business model that hurt the consumer and has spent his career looking for solutions to this. He also built a business incubator in New York called Alley, supported by Verizon, and stepped down from that in 2020 to focus on Relief.
Alley was where he first met his co-founders 12 years ago. “They built the first coding classes to teach people how to code in my office, and they went on to create different consumer applications as well as work for large organizations,” he said.
Okeke, now Relief’s CTO, is an expert in mobile development who founded Beginner Programmers, one of the largest meetups in North America. He also co-founded World of Ether, a hit blockchain game that saw over 1 million downloads in 48 hours. Berrouet, COO, is a full stack developer who launched World of Ether with Okeke in 2017, and before that he co-founded and grew the Fan10 sports platform to more than 5 million users before it was acquired in 2014.
Okeke said: “Each day we hear from our own communities that people need help managing their debt. With both myself and Ram being Black founders, we are proud to help solve such a huge problem at scale, while also growing the trend of investing into minority-owned communities.”
After the first year of deep research and putting together the technical schematics, Relief raised a seed found to begin to collect user interest. When they launched their waitlist a year ago, their goal was to acquire 50,000 users and have about $350 million worth of debt roll to the platform, Saltzman said. They doubled that with 100,000 users and over of $750 million of consumer credit card debt enrolled. “It’s proving that people actually need this and they trust Relief’s brand that we’re going to help them,” said Saltzman. “They stepped up to enroll.”
The business model is neobanking as a service. “So when you set up an account with Relief, you’re actually setting up a bank account, it’s just a bank for a purpose, it’s a bank to get out of debt,” Saltzman said. Relief also gets a small transaction fee from the creditor.
Relief has 8 full time employees, and plans to hire over 30 more with funding from the raise. All three co-founders and most of the team live in the Miami area. The positions are remote but “we’d prefer Miami because we want to give back to the community,” said Saltzman, who is on the board of Florida International University Foundation. Miami is a great place to grow the company because of its access to other business partners, large enterprises, other startups that are flocking to Miami — and its diversity, said Saltzman, a New Yorker much of his life. “I would argue that Miami is a bigger melting pot than New York ever was, and that is a very unique opportunity to grow a thriving business that is predicated on helping a diverse group of people,” he said.
“We get to wake up in the morning, and every time we hit our keyboards, we’re helping people because this problem is so big and it’s so toxic, and it’s not talked about. The goal is micro — if we’re helping one person, we’re in the right direction – and at scale. We do expect this platform to be used by millions and millions of Americans that are facing this problem,” added Saltzman. “Consumer debt has never been this high and now it’s been a volcano erupting due to the pandemic.”
Follow Nancy Dahlberg on Twitter @ndahlberg and email her at [email protected]
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