ReadyForZero

Overview

The free ReadyForZero web application was designed as a tool to help lead its users out of credit card, mortgage, automotive, and education debt by automating and speeding up the credit management process. The service allows its users to create debt repayment plans, track finances, make bill payments directly, and monitor progress of debt paid off and interest saved via personalized graphs.

History

ReadyForZero was co-founded by entrepreneurs Rod Ebrahimi and Ignacio Thayer in Summer 2010. The first version of the online debt management tool became available to the public in February 2011. Within the first six weeks of its launch, users of ReadyForZero had registered approximately $30 million of credit card debt with the online service. After its first two years, ReadyForZero had helped its users pay off over $25 million in debt, and the company's number of users was growing at a rate of 15% month-over-month.

In January 2013, the company collaborated with Stanford University economics students on an academic study about why individuals continue to stay in debt when they possess the means to get out. The ReadyForZero team participated by providing anonymous data for the study.

In March 2015, ReadyForZero was acquired by Avant.

Effective November 12, 2016, Avant will shut down ReadyForZero's credit score and debt planner tools. All user accounts will be deactivated and users will no longer be able to log in.

Funding

ReadyForZero is a Y Combinator-backed startup. Shortly after its beta launch in October 2010, ReadyForZero announced it had raised $260,000 in seed round funding. Angel investors in the round included Dave McClure, Steve Chen, Benjamin Ling, Nils Johnson, and Maneesh Arora.

In June 2011, the company received $4.5 million from a Series A funding round. Polaris Venture Partners led the round.

Partner companies

ReadyForZero features a Savings Platform to provide information about the company's financial partners (including Lending Club and Prosper), and connect lenders to users based on users' responsible finance management history.

Lending Club and ReadyForZero have been partners since ReadyForZero's public launch in 2011, facilitating loans for many of the debt payment tool's users.

In 2013, ReadyForZero forged a partnership with credit reporting agency Experian as part of its new credit report monitoring feature. The same year, Planwise and ReadyForZero announced a partnership that would direct in-debt Planwise users to ReadyForZero's services.

Personal online debt management platform

Users enter either the date that they aim to be debt free by or an amount they are willing to pay each month. The service connects to credit card, loan, and bank account information and calculates total debt and amount of time it will take to be paid off. The user is provided a payment schedule, consolidation loan possibilities, and debt-reduction progress statistics. All of the information is presented using graphs on the user's personalized dashboard.

The company has also designed alternative psychological techniques for their users to spend more wisely, including mailing out stickers to cover the magnetic strips on credit cards that have high interest rates and displaying total interest owed per day across all debts.

A mobile app for iOS and Android devices with push notifications and payment features has also been made available.

ReadyForZero PLUS

ReadyForZero PLUS was released in October 2012. The service includes all of the features of the freemium model as well as an automated payment system, allowing users to make direct payments to credit cards and loans.

The ReadyForZero PLUS version is available as a yearly or monthly plan, the primary difference being that the yearly option allows users to access the credit score monitoring tool.

Biweekly loan acceleration

In January 2013, ReadyForZero launched its student loan payment accelerator. The option allows individuals with education debt or other large loans to enroll in a biweekly payment plan, which increases interest savings over time. The loan accelerator works in conjunction with either the basic ReadyForZero service or the PLUS model, depending on whether or not the user wishes to have automated payments.

Credit score monitoring

ReadyForZero unveiled a credit score tool in August 2013. The new function included a credit score as well as a premium service to help users monitor their creditworthiness develop while debt is paid down. As a part of the expanded service, ReadyForZero was required to become fully PCI compliant, a process that included going through an audit to secure a partnership with Experian.

Security

The company's security measures are compliant with Payment Card Industry Data Security Standards and comparable to those in place at banks and other financial institutions.

Honors and awards

In 2012, ReadyForZero received an award from Interaction Awards in the Empowering category.