Investments

Hiatus App Tracks Subscriptions, Scores $1.2M Seed

The subscription model has taken off across commerce categories in recent years. It’s a versatile business model being used by merchants across segments to both reach and keep consumers. But as the number of subscriptions increases, it’s becoming easier for consumers to forget what they’re paying for.

New York-based startup Hiatus offers a mobile app for iOS with a simple premise: tracking subscription service payments to save users cash on unwanted or forgotten purchases.

Founded in 2015, the Hiatus app connects to users’ bank accounts, identifying recurring payments to subscriptions services in the transaction history. The mobile app uses 256-bit encryption to secure users’ financial information.

After scanning transaction history, the Hiatus app displays all identified subscription services in its interface, allowing users to cancel the subscription via phone, email or on the services’ website. Additionally, the app notifies users each month before an auto payment occurs.

While other startups out there also track recurring payments, said TechCrunch, Hiatus works to stand out by providing users the option to let the startup negotiate down their monthly payments without changing the other features of the service.

Investors are taking notice — Hiatus recently scored $1.2 million in seed funding. The mobile app is now available on iOS.

In a six-week beta test, TechCrunch said, Hiatus was able to successfully negotiate down the price of monthly subscription payments for some 93 percent of users — saving them an average of $137 per year.

For this service, Hiatus reportedly charges its users half of what they save in their first year, meaning if the startup doesn’t save users anything, the service is free.

In the past two years, Hiatus has reportedly analyzed some $2.5 billion worth of transactions from users who have connected their bank account, said TechCrunch. The company currently manages $50 million worth of yearly subscriptions.

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The July 2019 Pay Advances: The Gig Economy’s New Normal, a PYMNTS and Mastercard collaboration, examines pay advances – full or partial payments received before an ad hoc job is completed – including how gig workers currently use them and their potential for future adoption.

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