For the seventh stop of the nationwide Shark Tank Diversity Tour, the casting team for ABC’s “Shark Tank” visited Houston, where entrepreneurs pitched their business concepts at the 2017 Black Enterprise Entrepreneurs Summit. Here, Brandon Andrews engaged in a Q&A session with entrepreneurs at the casting call, and the organizations that support them, including Kiley Summers, founder and CEO of SpenDebt.
Shark Tank Cast (Photo: ABC Television Group)
Brandon Andrews: There’s a serious student debt problem. SpenDebt is addressing it. What’s the story?
Kiley Summers: Student loan debt is definitely a real problem for 43 million people in America. In fact, 63% of student loan borrowers are not making payments on time and not reducing their loan balances. There is a total of $137 billion in delinquency owed by 8 million people. To provide more statistics, the average undergraduate person graduates with roughly $38,000 of student loan debt, while graduates graduate with roughly $58,000.
SpenDebt CEO Kiley Summers (Photo: SpenDebt)
In 2007, I graduated with about $30,000 of student loan debt. I understand the pain of many Americans. I hired and counseled with my financial adviser, and he introduced me to Dave Ramsey’s debt snowball method. The steps introduced through the debt snowball method helped me build the foundation of my financial house. Now let’s fast forward, in 2015 my wife and I were able to become debt-free. We paid off our student loans and other consumer debt. While celebrating our success and sharing our story, we found many people close to us were drowning in debt. They were enjoying life, as we were, entertaining, going out to eat, vacationing, etc., but the main difference was that we had become debt-free.
As an engineer, I’m always thinking of solutions, but God planted this idea in me to help those around me; hence SpenDebt was born. SpenDebt is a financial technology company providing a micro-payment debt solution to help consumers reduce their debt as they spend. The website application enables consumers to apply a micropayment (i.e. $1) toward repaying a debt every time a purchase is made. As users spend, the specified amount is added to the purchase and then directly applied toward a debt, such as student loans.
BA: Why is this the right solution to address student debt?
SpenDebt Logo (Photo: SpenDebt)
KS: We believe SpenDebt is the right solution to solve student loan and consumer debt for a couple of reasons. It works in parallel to what most people are already doing and that’s spending money. SpenDebt provides an opportunity for those that are looking to accelerate debt payoff by complementing their current monthly payment, targeting mostly the principal balance. Also, the debt tool allows people to make a commitment to paying something toward their student debt all from their everyday transactions. SpenDebt makes debt repayment automatic and painless, creates discipline, and reduces loan balances over time.
BA: How does SpenDebt work?
KS: Here’s an example of a transaction: Let’s assume a user has signed up for SpenDebt’s web application, created a profile, linked their bank account to pay from (ex: Capital One – checking account), linked their debt account to pay to (ex: Sallie Mae student loan), and defined their micropayment (ex: $1). Also, let’s assume the user is buying a cup of coffee for $5. At the point of sale, the user will pay $5 for the cup of coffee plus the $1 micropayment.
SpenDebt Payment Screen (Photo: SpenDebt)
The $5 will go to the merchant and $1 will go toward Sallie Mae. On the receipt for the cup of coffee, the user will only see $5. However, behind the scenes blind to the point of sale, the $1 micropayment will be added. The $1 micropayment will be a separate transaction on the user’s bank statement.
BA: You pitched at our Shark Tank casting call at the Black Enterprise Entrepreneurs Summit. What does the opportunity to be on Shark Tank mean to you?
KS: Being on Shark Tank would be very special to me but more importantly the community I represent. It would give me the opportunity to share my story with the world. Not only that, but partnering with the Sharks could instantly change my company’s trajectory with their remarkable business expertise and impressive network. The power of Shark Tank is real and inspiring, even from the comforts of my couch. So being on the show, getting a deal, and working with either or all of them would be a game changer for sure.
BA: What did you learn at the Black Enterprise Entrepreneurs Summit in Houston?
KS: Participating at this year’s Black Enterprise Entrepreneurs Summit I learned a lot of things and built some great relationships. Some of the takeaways came from various speakers. Bonin Bough dropped a ton of nuggets during his presentation. One thing that caught my ear was how he defined this term “hackonomy,” creating value by breaking the mold or system. He explained how all of the great leaders and brands have done this and really pushed the culture forward; i.e. Mark Zuckerberg and Oreos. Hill Harper implanted his thesis on the word “FEAR” and the paralyzing stigma it has on people. He mentioned the etymology of the word and made the connection with “courage” leaving an optimistic definition on how not to limit your thoughts or actions based on “FEAR.” Pastor Kirbyjon Caldwell taught us that what your ears hear you say has more influence than what others say to you.
BA: As a black fintech (financial technology) entrepreneur, what do entrepreneurs like you need to be successful?
KS: Being a black (fintech) entrepreneur, I believe it is all about having access and exposure. Having access to capital, resources, and networks, increases the viability of a company’s success. It provides a blood flow of confidence in the business but ultimately the entrepreneur. All businesses need some type of financial injection at some point. Resources, such as a banking partner or financial institution, are huge because it could be the nucleus to help propel the startup from ideation to a minimal viable product. Also, being surrounded by a connected network of people makes both access to capital and resources more attainable. There is a well-known saying; your network equals your net worth. Lastly, I would suggest that exposure is key to being successful because it provides a level of validation. Allowing potential consumers, industry experts, advisers, etc., insight on what you are working on gives them the ability to provide feedback to the entrepreneur early and often. This is so vital for any startup; simply put by a wise man… “Exposure expands expectations!”
BA: How do you plan to grow SpenDebt in 2017?
KS: Currently, we are completing some internal testing preparing the web application to go live with our first beta 1.0 this summer. We plan to grow SpenDebt this year by continuing to leverage great events such Black Enterprise Entrepreneur Summit by networking and engaging potential customers. Also, we plan to broaden our reach by developing a digital strategy and presence on social media outlets.
SpenDebt App (Photo: SpenDebt)
Lastly, we are seeking partnerships opportunities with financial institutions and schools to offer our platform to students when the loans are extended to the students. We believe these three mediums will position us to grow our brand and provide student loan borrowers an opportunity to accelerate debt payoff and/or make a commitment by servicing the loan.
During 2017, Values Partnerships has been leading a nationwide casting tour for ABC’s Shark Tank. This casting tour is focused on to giving diverse entrepreneurs the opportunity to pitch their businesses and appear on the show’s ninth season. In addition to having the opportunity to audition for Shark Tank, Values Partnerships has also held discussions on access to capital, offered pitch prep sessions, and shared entrepreneurship resources with entrepreneurs from around the country, all throughout the Shark Tank Diversity Tour.
To apply to audition for the ninth season of Shark Tank and find out more information on the Shark Tank Diversity Tour, visit www.sharktankdiversitytour.com.