Digit, a financial startup that helps users save by taking money out of their checking accounts when they’re not looking, has pulled in $2.5 million in seed funding, TechCrunch reported on Tuesday (Dec. 16).
The round was led by Baseline Ventures, with Freestyle Capital, Upside Partnership, Google Ventures, Operative Capital, Garry Tan, Alexis Ohanian, Aaron Harris, Rick Berry, Nate Bosshard, Eric Ries, Joshua Greenough, Randy Reddig, Eoghan McCabe and Ted Rheingold also putting money in.
Digit positions itself as financial management for people who can’t be bothered. Users of the service give their banking credentials to Digit, which then monitors the checking account, calculates a pattern of deposits and withdrawals, and automatically decides how much to withdraw and when. (Users literally can’t decide for themselves how much to move or how often.) Then Digit moves money to an account it controls at a partner bank, without notifying the user of the withdrawal or amount. Digit keeps the interest, but the user can withdraw funds at any time.
Users can find out their Digit balance, average transfer amount and transfer frequency on Digit’s website, but there’s no mobile app, and most information requests are done through text messages. Digit sends users daily SMS updates with different pieces of information each day, which may include checking balance, how much a user is saving over time, or other details. Users can respond with requests for more information, or move funds back to the checking account by texting “withdraw.”
Along with the seed funding, CEO Ethan Bloch said Digit is also adding advisors for the company, including Braintree founding CTO Dan Manges, early Square team member Randy Reddig, Airbnb global payments general counsel Sharda Caro-del-Castillo, and Paul Hastings partner Tom Brown.