Did ChangEd secure a deal on Shark Tank?
ChangEd is designed to help people to save money for their student loan debt. Dan Stelmach and Nick Sky appeared on Shark Tank season 9 to display their mobile platform which is specifically designed to round up day-to-day payments.
They appealed to the sharks for an investment of $250,000 in exchange for a 15% stake in their businesses. Unfortunately, the sharks found that the amount was larger than the percentage of the share. The founders have helped students pay off more than $10 million in debt by 2021. As of April 2023, the company earns $6 million in revenue and they are handling over $2 billion on student loans.
Let’s check out what occurred between the sharks and the two businessmen in this article.
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A short overview of the ChangEd app?
The ChangEd app is a mobile app that you may download from the Google Play Store or the Apple App Store. The ChangEd app was launched to assist people with student loans so that they can pay off their debts within a short time by rounding up the amount of any purchases made with their bank account, credit or debit card.
For instance, if you spend $2.43 on a cup of coffee the app will round up the charge to $3.00 and will keep the additional 57 cents aside that will be applied for a payment on your student loan.
You need to keep in mind that it will not replace your daily payment on your loan. Rather, it will build up savings for extra payments toward the balance of the loan. On the other hand, it will save you money spent on interest and curtail the term you are perched with the debt.
ChangEd introduced its platform when it appeared on Shark Tank season 9 but at that time more than 9000 users had already downloaded the app for their savings platform and nearly 1000 saving accounts were opened through the app.
A few sharks were worried that other platforms have the same features to assist in saving money or repaying debts. But Dan and Nick ensured that their platform is supposed to be the first that targets student loan debt directly.
The sharks are not also happy with the business model. They said that it was not bringing adequate money so that they could invest such a large amount with confidence.
Dan and Nick acknowledged that they have 1000 open accounts and they have kept the membership fee $1 but they were still earning only $900 every month.
Robert Herjavec made up his mind to make an offer of $250,000 in return for a 48% share in the business. Nevertheless, Dan and Nick were not interested in this proposal.
Mark Cuban was ready to invest $250,000 in exchange for a 25% share in the business. Dan and Nick agreed to the proposal of Mark Cuban and made a partnership with Mark Cuban as he is from a technology background.
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The two brothers Nick Skrzyniarz and Daniel Stelmach started this business in 2016. Nick completed business studies at the University of Illinois and Daniel completed his education in business management from DeVry University.
Daniel said that though he made monthly payments regularly, his student loan was not being prepared quickly. That is why the idea of contributing spare change towards student loan payments came up in his mind and in this way, ChangEd was created. It is still in business as of 2023.
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What occurred to ChangEd on Shark Tank?
The founders of ChangEd managed to secure a deal after representing their business on Shark Tank.
Nick and Daniel initially wanted to get an investment of $250,000 in exchange for a 15% share in the business. As soon as they shared how the app was born and how it worked the Sharks started to throw questions to them one by one.
The founders shared that they have more than 1,000 active users and 9000 downloads. They had even collaborated with over 90% of student loan providers. When they appeared on Shark Tank, they assisted in paying off nearly $25,000 of student loan debt. They also added that they are expecting to pay off a minimum of $100,000 in student loans by the end of the year.
Barbara had sounds about the entire thing. She thought that the banks they are making collaborations with may offer the same benefits. That is why she left the show. Alex also left the show quickly.
Robert inquired the founders about their valuation. Nevertheless, he said that he was ready to invest $250,000 in exchange for a 48% stake in the business. Lori had doubts about the valuation. That is why she also left the show.
At last Mark Cuban proposed to them to invest $250,000 in exchange for a 25% stake in the business and the founder accepted the deal.
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ChangEd is now handling more than $2 billion in student loans. If you are looking for an overall loan payment app, the ChangEd app will be an ideal choice for you. It will not repay all your loan amount. Rather it will help you.
We are recommending this app as it applies to change from regular transactions to loan payments. You would have never imagined this type of change contributing to your loan repayment.
Some people think that it will repay only a small amount in this way, which will never be important. That is completely wrong as those people do not have any idea about the original nature of compound interest.
Compound interest can change from a small amount to a big one. That is why lenders find compound interest loans so interesting. It is very harmful to borrowers.
That is why even if you repay only $30 to $50 every month in loose change by using the app you will be able to save thousands of dollars easily on student loan interest. This app outs loan repayment on auto-pilot.
The original value of this refers to accepting the power of loose change. It applies small amounts towards loan payments that you would never have missed anyway but which can always make a big distinction towards your loan.
Nevertheless, paying this change from every transaction is a problem. This is where the app comes in as a saviour. It takes all the problems of loan payments by applying change from your daily transactions automatically.
In brief, you will be able to feel relaxed as the app will take the responsibility of paying down your loan by using small changes.
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What are the advantages and disadvantages of ChangEd?
- It enables you to get a hassle-free automated loan payment experience.
- It is easily usable.
- It has a clear user interface.
- To use this app you have to buy a monthly subscription plan.
The ChangEd app is a substantial business idea that can offer real value to its users by assisting them in saving thousands of dollars on loan interest only by paying it with small changes.
Who is ChangEd for?
ChangEd is for students who are struggling to repay their loans. If you want to automate the procedure of applying the small change on your regular transactions towards your student loan payment along with your monthly payments, you may choose the ChangEd app without a second thought.
Are there any alternatives to ChangEd?
There are a few alternatives to ChangEd. Some of them are Chipper and GradJoy apps which are based on the same platform.
How much is ChangEd?
You need to pay $1 as a membership fee if you want to get access to the ChangEd app.