Dozens: Overall Update + Community Changes

Sorry the ISA is a red herring here. This is a product in its early days of development still, so plenty of steps to get through and am sure there will be wrapper specific considerations, but Lombard as a general concept exists for Private Banking clients and constitutes the majority of their non real-estate borrowing.

So, whilst we are still working through exact details and it will be a while before this is love, as yet we haven’t uncovered a blocker to bring this product in some form to mass affluents, and in fact have started to narrow in on one feasibility option already.

We designed it to dovetail it with the funds on our shelf, so unless you were in the same funds effectively there will be a sell and a buy, while staying within the same wrapper of course. So, launching this after widening the shelf further per comments here on this thread, may make sense. We are also still modernising the investment backend further and the right sequencing may well be to not jump the gun and complete that most complex step first or at least alongside shelf widening.

Yep, very clear! But looking forward to speaking soon anyway to brainstorm more.

Curious - any ideas on roundups? Do they matter to your savings? Should they go towards any other assets or uses like charity again (maybe alongside interchange as a boost, but as a switch on option of course)?

And is the IFTTT integration still worth it? Do people on the street who do not work in tech or close to tech, actually use IFTTT? I know we can do a more seamless integration than our current version but the usage stats are a bit weak, so curious about the qualitative feedback.

I can see why does it work for private banking clients. To open an account with a private bank, one must show evidence of either high income or high net worth, sometimes both. In that position, the 20k annual subscription limit for ISA and 40k annual allowance for pension are nothing, they will end up with most of their assets invested outside the tax wrappers. The nature of unwrapped account means they can be used as a collateral for leading. That’s why private banking customers have such an access to margin loans. This unfortunately doesn’t work for us who doesn’t earn half a million a year.

Maybe I’m wrong, you may have a different kind of product in mind, I’d love to hear more about it after you’ve worked out some of the details.

Imho no - Dozens could more usefully concentrate on other priorities

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I personally don’t use any of them, with Dozens or any other financial service provider. But as you can see, I’m not the typical banking customer, so please take my opinion on this with a pinch of salt, a fairly large pinch.

I don’t like idle money lying around my current account earning me nothing. I have a number of SOs and DDs on or just after my payday to empty my current account. As a result of that, my current account is kept at zero or close to zero balance all the time, and I spend on credit card instead. It would be a great loophole if I can roundup my spending on CC and put the money in a savings account :slight_smile:

IFTTT is also useless for me. I will know the credit card’s repayment amount and all other fixed outgoings (bills, etc.) about a month in advance, so I can update the SO to my savings account to take everything left on the payday. (Note: the DDs are often not on the same day, so the SO can’t simply take the account to zero balance)

What will work best for me? A programmable bank account, either in the form of APIs (to query balance and make payments), or allow me to write complex code (it needs to be able to fetch and parse the CC statement). This unfortunately isn’t available, I know no bank offering services like this. The closest one is the Starling bank’s API, it has everything else I needed, except that it can’t make payments. The SCA rule blew my last project which used automated web browser to access online banking and does those things for me. Now make a payment requires either an OTP from either the banking app or via SMS, and neither can be cheaply and easily automated.

What will work for me? Web browser based online banking and email based OTP. I’m fairly sure this doesn’t break the SCA rule, but no bank has done it. I know many savings accounts and investment platforms do this. Web browser automation is cheap and quick, and email OTP is much easier to implement on a computer than SMS or mobile app.

Can’t divulge too much obviously but wrapper specifics aside, at this stage we believe that this is a doable product for this segment and have identified the partner as well.

Just like the hedge fund / absolute returns product that we still haven’t given up on for the invest shelf. In both cases, Dozens as an institution will try and act as a go between institution to somehow then split the ticket sizes into smaller chunks for end users. Not a no-brainer but as of now, feasible on our books. Will keep you posted but to be clear again, this is on the slow burner - aiming for end next year perhaps.

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Thank you. There’s no rush for that, I believe it’s far more important to improve the invest section’s experience for your customers first. I also have reason to believe that’s exactly what you are doing behind the scenes right now. I’m happily paying over £200 per annual for the platform fee and trading commissions at the moment, across a few platforms. I don’t mind at all if Dozens charges me £200+ a year for the same service. But, keep in mind, the “same service” is full featured investment platforms I’m talking about - GIA, S&S ISA, S&S LISA and SIPP, and access to nearly all funds and exchange traded products (listed on LSE, AIM & foreign exchanges) available to UK retail investors.

This is definitely in the long-term aspirational category, but an alternative to an overdraft that offsets against savings or investments - and appears to the customer as simple as that - would be a massive win. I’d be super keen.

Completely agree - and yes can confirm a great fit-for-purpose for all degrees of sophistication, but still simple for first timers Invest is our absolute key focus mission-wise, only competing for mindspace with revenue initiatives (just to make the business side more sustainable)… and that’s why tying the £5.99 back to transparency and banking business models felt like a good way to go about the latter.

Feels like we are aligned in terms of direction though, so thanks once again for taking time to share your detailed observations! Super helpful.

They’re nice, and I use them on Monzo. I like a n.00 account balance so I use the native roundup together with ifttt.

But, that said, I wouldn’t lose any sleep if they weren’t a thing. Indeed, I’m very over ifttt - as I understand it they charge you for integration then me for use of the service.

I like @Roman’s idea of a programmable bank account. But let’s be honest: that’s niche even for us. Where I do think there’s mileage is in some native rules. The most basic is a trigger on “salary received” - but could be a whole bunch of things: changes to category, adding notes to direct debits - or more excitingly, pulling money from another account if my balance gets low; sending money elsewhere when conditions are met when it’s received etc etc.

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No, not since it stopped being free.

Direct access to your API far more interesting prospect… to actually move money programatically. I know it’s much to risky + niche to happen.

I think roundups are very popular and a good way to kick-start savings. Same for 1p challenge etc, its very accessible.

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Ditto, I have the IFTTT set for Fitbit but it died last year and I didn’t replace it. Never really felt bothered by it. Often I move the savings money back out to spend if I needed it so it’s wasn’t worth it as an incentive.

I think the real interest in round ups is Chase’s new entrant offer, where the roundups go straight to a premium rate savings account. I appreciate chase is bank rolling their 5% similar to dozens did with bonds as marketing but I’d say dozens should send round ups straight to the new 1% as an option. That REALLY makes saving a no brainer. (And once the chase offer is over would make me think about a move wholesale… That… and allowing crypto again, as that’s allowed by chase :stuck_out_tongue_winking_eye:)

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I think the issue is that as a shareholder, I can’t see the proposed Dozens Black offering with a monthly fee to have a wide appeal for most customers who don’t have lots of investments or cash to hand.

You only need to look at somewhere like Tridos Bank which charges a monthly fee and comes with a uniquely environmental USP which many agree with.

However, they haven’t really broken into the current account market as most are unwilling to pay a fee for a current account.

I didn’t mention BNPL or crypto?

However, in the interests of constructive feedback, if I consider various elements of the proposed Dozens Black offering:

Lots of banks offer fee-free ATM cash withdrawals at home and abroad without customers needing to pay a monthly fee

Sharing the interchange sounds gimmicky - whether it goes to a "good cause’ or the customer. Dozens might as well keep that income and look at lowering the monthly fee instead.

How much would customers benefit from this compared to using someone like Wise? (Edit: I see Monzo is also offering ‘0.3% cashback on international transfers’ though that’s obviously funded by fees).

The following remind me of Monzo’s failed attempt to launch a “Supporter” tier (and that’s with a brand with much stronger ‘customer loyalty’) and all customers deserve decent customer service regardless of their account type:

  • Dedicated customer service line
  • Exclusive Dozens Black card
  • Early access to new features, services and products

As others have said, you need to expand the range of funds/offer customers the option to buy individual stocks to be more attractive.

What happened to the intention to offer other savings options such as term deposits and some other innovative capital-protected savings products?

Hi @gt94sss2 ,

That’s some good insights. I totally agree with you. The Dozens Black as where it stands right now, is really only looking attractive to potential customers who already have a fairly large investment portfolio, but due to the funds availability issue (and other frictions), it isn’t looking attractive to this type of potential customers at the moment.

I assume the capital-protected savings products you mentioned are things like the structured deposits and guaranteed equity bond? These products are the result of financial engineering. They may look like a safe way to earn some of the stock market return, but in reality they are very complex products designed by actuaries to benefit the bank at the expense of their customers. Savers/investors are much better off to hold traditional savings and investment products. Here’s some pretty good analysis of the guaranteed equity bonds and how to create your own “capital-protected savings product” with the combination of a fixed savings account and an index fund.

Dozens aim was always to offer notice accounts and other capital-protected savings for domestic customers as a bridge between holding cash and equities. I recall it being mentioned several times in the past, as well as here

When the 2020 crowdfunding was taking place @AC also mentioned:

as well as Cheque Imaging (mentioned as particularly important for business accounts), offering insurance products and the potential for a Lombard Lending product (mentioned above)

It would be helpful to get an update on these, as well as what Dozens has learned from those customers currently trialling Dozens Black and their usage of the account.

Finally, on fees, I suggest Dozens do £x not £x.99 - I know some marketing theory suggests otherwise but am not sure it works as well in this market.

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All definitely part of the roadmap as well as live architecture, both technically and treasury wise. But we need longer term funding for these to be launched as I am unwilling to launch long horizon products that are difficult to unwind on a monthly or bimonthly funding pattern. Hence, the decision to build as much as nicely and as smartly as possible in this period.

Wrt shareholder views, rest assured these ideas have been vetted over months by the Board, where Clement and I still control 90% of the shares - simply because of amount invested btw not through any other means. I do also take the Seedrs commitments very seriously, and can restate my commitment that as long as I am in charge, we will never look at any deals - commercial or strategic - where your interests would be harmed.

Also, having promised an 12/18-month runway and delivered close to 30 already over a black swan event like Covid, and hitting growth numbers as promised or better, I think the discussion here needs to be more positive and mature, learning from our larger competitors’ missteps and therefore in the direction of: having built this initial foundation of tech, traction and team, what brings revenue and constitutes best monetisation for this platform, without breaking mission. It’s a long game and we have had less than three years, half in Covid!

Am all ears for your ideas on this btw - but subscription model is definitely the future of responsible banking in my view. It’s a question of how many iterations we need to get the package and pricing right, but we need to start somewhere.

On investments, agree on broadening the shelf and the only technical sequencing there is backend work on the Invest platform but we are in a position to widen shelf today if we want to. In its current form, Dozens is unlikely to offer direct equities though - it doesn’t meet suitability criteria for most of our target clients in the mass affluent savers yet to buy their first invest product.

Ps: For Savings, I can’t disclose specifics but we generally don’t view financially engineered products as Savings so its got to be a deposit product or equity funded bonuses etc. Rest could make it to Invest risk level 1, but the funnel shape would be different.

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Take your point on 0.99 - we might drop it in the future. Hard to do an A/B on so we will ensure we keep a watch on reactions somehow through research.

We haven’t really thought about cheque imaging yet but other than that, everything else you have mentioned is ready for launch within months of long term funding. For eg with term deposits - where we are not a bank - it is dependent on solid partnerships that depend on runway on both ends, and because of the setup, also add complexity to winding down. So again, back to the sequence:

  1. Fix front end alongside remaining back end work
  2. Launch Business Banking
  3. Push marketing budgets

It’s only post these three steps that I can report back on what’s working what’s not as there’s not a lot of successful profitable fintech models to learn from yet.

With just £23m raised so far, and a team of employees less than 30 and costs so low, we have built an amazing product company so far - it is missing the marketing lifecycle and pricing feedback loop but not the product and trust feedback loop. I believe we can carve a profitable and sustainable niche for ourselves when we execute this strategy but given its regulated financial services for the retail segment, our risk aversion stopping us from preemptively marketing is in the interest of our consumers. If we live and do well because of this, not despite yet, ie Trust has got to be a key brand differentiator alongside the other three pillars of cross-asset (seamless current savings investments transfers, to and fro), cross-segment (biz to retail cycle of money) and cross-border (FX products, not multiple countries).

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Let’s get @sam’s update on Biz Banking in at this point so we can also get your views in specifically on that.

Next week, we will followup with an update on partners and platform specifics from @Sandesh, bonds and 1% product update from @Tatia and a people / how we are dealing with remote working update from @hannah, to paint an even fuller picture.

Retiring for the weekend! Thanks again, so so much for your amazing engagement everyone - your thoughtfulness and care gives me a lot of hope for our future!

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