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May 20, 2021

Why QED Invested in Spinwheel

In the latest installment of the series, QED Investors Principal Laura Bock explains why we led the $11 million round in Spinwheel, a company that helps Americans get out of debt sooner by embedding the payment, management and application of loans into the apps they use the most.

Americans are struggling with historic levels of debt: 80 percent have some form of consumer debt, and the average debt burden is $90,000. For most people, stress and anxiety around how to repay their loans is the No. 1 pain point they face when it comes to dealing with money.

This stress spills over into many aspects of life as debt causes delays in major events, such as buying a car, getting married, buying a home and having children. Many borrowers are also forced to delay saving for retirement as nothing is left after expenses and debt payments. The situation has only been exacerbated by the COVID-19 pandemic in which four of 10 households suffered the loss of a job or wages.

While consumers have benefitted from a growing set of tools to help them understand and manage many aspects of their finances -- easily tracking their spending habits and balances, for example -- support for debt repayment has lagged. Many companies would love to help consumers with debt but have abandoned efforts given how difficult it is to navigate archaic lender systems to access data and initiate payments without robust middleware connectors that are available for understanding the other side of the balance sheet. As a result, consumers have been left without technology to help them tackle their biggest financial challenge.

We believe there has never been a more important time to remove the technological barriers preventing borrowers from having access to easy-to-use tools and solutions for managing their debt. That’s why Adams Conrad and I were so excited when we met Tomás Campos and Tushar Vaish and learned that they founded Spinwheel to solve this exact problem. Spinwheel provides the core infrastructure developers need to embed the application, payment and management of loans into the apps and services people use the most. They are starting with student debt but plan to expand to credit card, auto and other loan types so that borrowers are empowered to understand, plan, monitor, optimize, pay and refinance all their debt holdings.

Building new fintech rails is not an easy endeavor, but after spending a good part of the past year getting to know Tomás and Tushar, we are confident they are up for the challenge. They previously built the APIs and financial technology for one of the largest payment networks in the world at Blackhawk Network and are invigorated to use their talents and expertise to help Americans struggling with debt. After working together for more than 16 years, they have become a complementary and supportive duo, sometimes completing each other's sentences.

We are thrilled to announce that we are leading Spinwheel’s $11 million seed financing. We believe Spinwheel’s platform will pave the way for a whole new category of financial tools. With Spinwheel, employers, financial institutions and other companies will be empowered to innovate and solve problems for the millions of Americans looking to navigate their debt. By increasing access, choice and transparency, they will help alleviate the burdens of living with debt and improve outcomes for borrowers. We could not be more excited to be along for the ride!