Fintech Spotlight: Unpacking Finny's Quiz-Based Take On Financial Literacy

In the last two years, the commission-free revolution and gamification of online trading platforms increased engagement in markets. Now more than ever before are people interested in learning about finance and unique ways to put their money to use.

In light of this, Benzinga spoke with Milan Kovacevic, co-founder at Finny, a fintech platform dedicated to financial literacy and wellness initiatives.

About Kovacevic: Twenty years ago, Kovacevic fled war in the Balkans and immigrated to the United States.

“I had about $2,000 in my pocket, and that’s all we had to kind of escape the war,” he told Benzinga. “After landing at LAX, I had to figure out pretty quickly, on my own, how to get by.”

Kovacevic did have a motivating support network; shortly after settling in with family, he was accepted to graduate school.

“It was a tremendous amount of pressure in the beginning,” he said. “It was an advantage, though, because I didn’t have the student loans many of my classmates had.”

During his studies, Kovacevic turned to the wild markets of the late 1990s for engagement, stock picking and “gambling,” as he said.

“It was 2000 and Jim Cramer was still around,” Kovacevic noted. “I took notes and bought every stock he recommended. As you can imagine, by the beginning of 2002, I had like 10% of what I invested.”

After losing money during the burst of the dot-com bubble, Kovacevic turned to personal finance education, an interest that later turned into a passion when he left his Oracle Corporation ORCL vice president position to launch Finny with his wife, Chihee Kim, a former executive director at MSCI Inc MSCI, a global provider of indexes and portfolio analysis tools.

“We did pretty well, and we thought it was time to do something we were truly passionate about. Working for the man can be financially rewarding, but we wanted more.”

The duo combined learnings from retail and institutional finance, sharing best practices for budgeting, spending and investing through Finny’s gamified, quiz-based web-app and online investor community.

More On Finny: At the outset, Finny was a way for retail investors to do due diligence on passive investments.

“Often, people would come to us and say: ‘Hey, what do you think about this stock or ETF? Can you give me an unbiased view?’”

The team at Finny, through a rules-based methodology, provided a bull- and bear-case, on a number of parameters.

“We start with the valuation and fundamentals because that’s easy,” the co-founder said in reference to Finnyvest, Finny’s online market analysis tool. “We also give them the tools to compare individual investments.”

Pictured: Finnyvest by Finny, a stock and ETF analysis tool.

From there, Finny’s founders built a discussion forum and support system for the investment community. Users can ask questions and receive answers from staff members, as well as professional consultants and wealth advisors contracted by Finny.

Additional solutions include a newsletter with 60,000 subscribers.

“We’re on this mission to educate, to make personal finance and investing education easy and accessible.”

New Wave Of Investing: 2020 was a year of extreme financial markets engagement.

According to Kovacevic, the barriers to entry are lower and retail investors, together, are becoming just as impactful as institutions.

“Gamification is controversial; in some ways, it’s a good thing because you’re lowering the barrier to entry, and making people more motivated to participate in something that’s perceived as a game,” he said. “But, it can be dangerous. If you apply it to trading, and encourage people to trade just because the cost to trade is zero, that’s not necessarily a great thing.”

That’s where the next evolution of Finny comes in. After the pandemic started, the team at Finny looked to apply gamification to education. The interesting take on personal finance learning comes in the form of gamified quizzes.

“When you go onto Finny today, you can learn in a programmatic, gamified and quiz-based way that’s tailored just to you.”

Pictured: Landing page for Finny’s guided, personalized learning experience.

The platform gives learners a strong foundation, educating first in saving and budgeting, as well as credit and debt.

“We don’t start off with investing because we think you should start with some basic things that everybody should know,” Kovacevic said. “Once we’re done with that, then we move on to investing because you have to have the fundamentals, right, along the way. We start with the basic stuff like what’s an asset class? What’s a stock? Diversification. Why does it all matter?”

Pictured: Finny users can earn rewards for their engagement on the platform.

Fueling The New Wave: Alongside speculative commentary on online forums like WallStreetBets, shares of GameStop rose as high as $513.12 in premarket trade on Jan. 28, after which numerous brokers made the controversial decision to limit trades, creating a synthetic imbalance that caused the stock to plummet.

Popularized brokers like Robinhood later came under scrutiny because the decision came off as a collusory initiative with liquidity providers like Citadel, a customer of Robinhood’s order flow.

“We see people who are riding the surf and those that are wiped out,” the co-founder said in a discussion on the next set of lessons retail investors are likely to learn in light of a new, volatile market regime. “At the end of the day, it will come down to the basics, and I think to win in the long-term, particularly as … an investment powerhouse, you have to do the right thing.”

Though Kovacevic is encouraged by recent engagement, he said it’s paramount investors increase their awareness.

“As retail investors are banding together to march toward the same goal, I think we’ll see a lot of people who will come out of this scarred -- not to make this sound horrific -- but, I think there’s going to be the next wave of lessons of all of us to learn, and so, we’re going to continue to provide that education, and a perspective on what’s happening, and how do we go to the next phase.”

Going Forward: Finny is looking to grow thoughtfully, letting feedback dictate its plans for growth.

“We’re constantly thinking about how we scale and continue to provide value to our members,” Kovacevic said. “In the longer-term, we’re going to be focused on financial wellness and health. That’s really core here because I think in America we have this problem where society is becoming increasingly polarized.”

The co-founder said his team has a keen eye for what consumers want -- free and fast access to actionable insights -- and markets are reaching a tipping point where consumers are getting more power and are willing to get educated.

“Our responsibility is to continue to provide education and research for the retail investor.”

To learn more about Finny, click here.