Struggling with the Covid-19-era economy and rising prices of everyday goods, some consumers are turning to lines of credit to make ends meet. In the year According to a September 2021 survey from Bankrate.com, 42 percent of adults with credit card debt have increased their balance since the pandemic began in March 2020. The latest report from the Federal Reserve Bank of New York estimates total household debt in Q3. 2022 reached $16.51 trillion, up from $2.36 trillion at the end of 2019.
A New York Fed survey also found that the proportion of current debt going delinquent has risen for almost all types of debt, from mortgages to auto loans. But even before the pandemic and falling inflation, the US had a delinquent debt problem. In the year According to a 2016 white paper by Credit and Collections Professionals International, debt rose from $150 billion to $600 billion over the past five years. In the same time frame, collection agencies that took 20% to 50% of the proceeds – had an annual success rate of 7%.
To solve it—a lofty goal, to be sure—Hanif Joshaghani and Tiffany Kaminsky founded Symend, a company that employs AI and machine learning to automate processes around debt settlement for telcos, banks and utilities. Symonds today announced that it has raised $42 million in Series C led by Innovia Capital with participation from Impression Ventures, Mistral Venture Partners, BDC Growth Ventures Fund, BDC Capital Women in Technology Fund, Plaza Ventures and EDC. While less than Seamond’s once-extended Series B ($95 million), Seamond CEO Joshaghani noted that it was “all equity” and brought the company’s total capital to date to $140 million.
“We have maintained and continue to maintain a very conservative balance sheet profile,” Joshaghani told TechCrunch in an email interview. “This latest injection of growth capital will enable us to meet the growing demand for behavioral engagement technology around the world. While this is not an ideal time for many businesses to transition to crowdfunding, for Symend, this is a time when our product needs are growing and the realities of the market have created a deep white space for us to capture.”
Joshaghani comes from the financial industry, having worked as a corporate finance manager and investment banking associate. Kaminski’s background is in marketing – before founding Symend, she was head of sales and marketing strategy at Frog3D, a CNC fabrication business.
Examples of messages customers may see from brands that work with Symend. Image Credits: When driving
Both Joshaghani and Kaminsky say they have personally experienced the negative effects of debt. Joshaghani grew up in a household that was frequently targeted by calls from debt collectors, and Kaminki ran into problems with balances on her first credit card as a teenager.
“To this day, I remember the stress I felt when I received calls from groups and knew there had to be a better way – for customers and for businesses,” Joshaghani said. “We founded Cymand to help consumers like us, and as we’ve grown over the past six years, our mission has remained the same – our vision is to transform the science of engagement on a global scale.”
Symend identifies when customers are struggling to pay bills and provides analytics and tools aimed at helping companies develop debt improvement programs. Through the platform’s workflows, businesses can engage with loyal customers at points that can drive change. For example, you can configure SimNd to create payment plans and fixed-term payment discounts for certain customer segments, or have the platform connect at-risk customers with financial planning tools, resources, and credit recovery programs.
As Joshagani explained to me, Simond works with the company’s existing systems to “facilitate communication” with customers whose bills have fallen due to illness, job loss, family problems and other unforeseen and unexpected circumstances. The platform allows a business to send messages through the customer’s preferred channels (e.g. text and email) to access playbooks for various debt collection situations (e.g. delinquent credit cards).
“Our clients continue to use general-purpose engagement platforms to manage their broad-based customer relationships, but when driving, they specifically deploy their legacy customer bases to solve complex challenges,” Joshaghani said. “Our ability to leverage behavioral science is one of three key innovation areas of our technology that leverages proven behavioral engagement playbooks using AI, machine learning and data science to deliver out-of-the-box impact for companies across industries.”
Symend is vague about the platform’s functionality and technical underpinnings – its website prefers jargon buzzwords over plain English descriptions. But this does not scare customers, it seems; Joshaghani Simmonds says it currently serves financial institutions, alternative lenders, utility companies and most telecom providers in North America, including Telus.
Undoubtedly, the rise of Buy Now, Pay Later (BNPL) services – which allow users to spread purchases evenly over a short period of time – is driving new business to Symend. According to a recent report by the US Consumer Financial Protection Bureau, delinquencies on BNPL services are on the rise as sellers approve more customers for loans.
Joshaghani added, “As with any business, the current market conditions and economic uncertainty have left us looking at clients with tight budgets and streamlined decision-making. However, this latest round of funding highlights the market’s need for compassionate, personalized solutions to meet the needs of consumers when they are facing financial difficulties.” It leverages the approach, and demonstrates investors’ confidence in the company’s proven track record with major financial institutions and telecommunications providers.The dollar and the customer are more important than ever.
