Mint founder on branding: Keep it simple
Aaron Patzer, who founded Mint.com and sold it to Intuit for $170 million, tells CNET that entrepreneurs should start their strategy with the most basic of items: the company name.
MIAMI--Walk around the Future of Web Apps event in South Beach this week, and you'll see loads of eager young entrepreneurs and developers proudly displaying the names of their fledgling companies on their conference badges.
Aaron Patzer, who founded personal-finance site Mint.com and last year, might tell them that the company name might be the first place to make changes.
"Choose something with meaning, even if it's expensive and difficult to acquire, rather based on domain name availability, because otherwise, you're going to kill word-of-mouth," he told CNET on Monday, a day before his scheduled keynote at the FOWA conference, called "How to Take Your Start-Up to the Next Level." He said this was particularly crucial for Mint, a product that isn't a social site and therefore can't plan to rely on viral spread.
Mint may be recalled as one of Web 2.0's most notable successes, even though $170 million is small, compared to what we'd see from a Facebook, Twitter, or even some of the social-gaming companies that have sprung up on Facebook's platform. (Playfish sold to Electronic Arts for $275 million.) It was a start-up that used new technology to fix an old problem--the headaches associated with oft-expensive personal-finance services--and did it so well that one of those companies wanted to bring it on board to shake things up from the inside out.
Many Mint users had been horrified when they heard about the acquisition, thinking that Mint's team had been selling out and that Intuit's management team would effectively corrupt the product. To quell the concerns, Patzer, now serving as vice president and general manager of Intuit's personal-finance group, posted an announcement on Intuit's blog explaining the situation: that Intuit was shutting down its Mint rival, Quicken Online, and that the finance company had bought Mint because it really, legitimately wanted to learn from it.
He says that hasn't changed.
"They thought Intuit was going to screw this up. They thought Mint was going to become more like Quicken, and well, you can see that Quicken has definitely become more like Mint," Patzer said. Its revamped Quicken for Mac product, for example, was built by the former Mint team to better fit the Mac user interface.
"We've started to influence what the product is from Mint already; when I first got to it, it wasn't maybe as streamlined as it should have been, and we put a lot of user interface and product resources on it," he said. "Fortunately, the Mac team at Intuit--they work as hard as any start-up I've ever seen."
Mint's technology and expertise will be permeating many a Quicken product--but its name won't. This is largely because Quicken is a far more recognizable and trusted name among U.S. consumers; Patzer said Quicken has an 85 percent recognition rate, while Mint's is somewhere around 7 percent or 8 percent. But Patzer doesn't discount his near-obsession with the company's branding, an advantage he hopes other young entrepreneurs will recognize it gave him.
About a year before Mint's sale, Patzer had taken the stageand displayed a slide of Mint's name and logo alongside those of its competitors, an array of start-ups with names like Wesabe and Geezeo. Mint's product had an instant edge because of how its name branded it--a simple, easy-to-spell dictionary word, alluding to both the manufacturing of money and that fresh, clean taste. (The fact that it was a well-executed product couldn't have hurt, either.)
Mint, Patzer explained, is actually a contraction of the company's original name, "Money Intelligence." He'd purchased the domain mymint.com for about $3,000 of his own money prior to raising any venture funding, and then started pursuing Mint.com itself. The buyer, an investment banker who had run a fund called Mint Investments for years, didn't want to sell--and due to the success of the eponymous venture, couldn't be convinced by any sum of cash.
"I had my investors talk to him," Patzer said. They offered him equity in the company's Series A funding round rather than a cash payment, and assured him that he'd be the only New York financier they'd let in. "It [was] almost an appeal to ego [and] exclusivity more than it was money," Patzer explained.
"He made tenfold on his money, and on that part was so pleased with the business and the progress that he actually [contributed to] the B round and the C round," Patzer said of the Mint Investments founder. "It was a three-month negotiation. It was one of the most difficult negotiations of my life...that's how important branding is to me."