Christo Davel called an assistant to the front and asked him how many people he thinks noticed his Barry Manilow t-shirt. Everyone glanced at it, said the young assistant. Davel then asked the audience, a suave group of about 40 sitting in the function space at Circa Gallery in Rosebank, Johannesburg. Only a few hands went up. That’s how “dofly” we respond to things, said Davel. “Most of the time people don’t give a damn. You do things according to how we think people will react.”
Davel, a former dentist, hotelier and founder of the transformative 20Twenty online bank, was launching his team’s latest initiative, 22Seven. Pacing the floor in front of the seated audience, he was the centre of attention. The global financial crisis proved there are serious flaws in how “the average guy on the street” manages money. With no lectern, he faced the audience in black suede shoes, black trousers and a black shirt. Behind him, a projected presentation flowed in sync with each new point: 48% of people spend more than they earn; there’s a disconnect between the dumb things we do and the financial space. But how do you change behavioural patterns?
Behavioural economics, it turns out. Referring to the popular mantra of scholars like Daniel Kahneman, he said that financial decisions aren’t made in isolation from emotions. Studies have shown that if you want a phone for R2,000 at one store, you’re willing to travel four blocks to another store if it’s cheaper. But if you’re buying a suit, you won’t travel the four blocks for an identical but cheaper option. “It’s quite obvious people treat the same rand differently… People also treat different income differently.”
It’s hard not to look at Davel as a sort of South African Steve Jobs. It may be a fruitless comparison but it was mentioned over the gourmet finger food on the gallery’s rooftop. A tech-entrepreneur, he commanded the floor with a one-man show, and despite a presentation on finance – spending habits, no less – he held the audience’s attention. There was no turtleneck, but his outfit matched the 22Seven’s launch – simple, stylish and design focused.
That’s what Davel wants to offer your personal finances, too often governed by instinctive spending and a lack of understanding. “People are hard wired to make choices on instinct, intuition and emotion. It doesn’t matter how many budgets we do or how many books we read, we will still act like the complex, emotionally governed human beings we are.”
Photo: 22seven home page.
22Seven is an online service that automatically collates information from your bank, credit card and store accounts. You start by entering all those security details you’re told never to share. Staff assure the process is safe. 22Seven fetches your balances and transactions and lists them all in one place. “This is not so smart. This you can get from other people. This is just a statement,” said Davel
The cool part is how it organises your finances. After you play around with the categories of spending – the automatic presets aren’t always right – the site analyses of your habits. It’s what would happen if Apple made an accountant. You can see the money flows in and out and how you’ve been spending on certain things according to the timeframe of your choice. You can budget and build your savings. The best part is that all the information is collated for you.
The focus of Davel’s 20Twenty start-up was a fanatical attention to customer service, and he follows through with 22Seven. The site’s built in flash and is relatively simple to use. It means, however, that usability is limited on certain devices. But the analysis is sleek and straightforward, a scary reality check to those of us who worry about their finances only when they see the word “declined”. Davel wanted a site that helps teach users to manage their finances, not just offer information, and the service is engaging and occasionally humorous.
The question is: who will use it? Asked how many users he envisions, Davel would only respond “a lot”. It’s online so is limited to Internet users who make enough electronic transfers to need an organising tool. Factor in the R70 monthly fee and it’s unlikely to be affordable to the “average man on the street”. Antoinette Muller from MoneyWeb said it will be a hard sell to credit-addicted consumers whose habits are ingrained and don’t necessarily want the advice. Another personal finance specialist felt it was too complicated for the average Joe.
After leaving the launch, it’s hard to match 22Seven to the ambitious premise of Davel’s presentation: in a volatile economy the average person needs help with their financial decisions and an online site offers something more than the everyday advice they don’t trust. But with such high ambitions, a brilliant launch and a man resembling Steve Jobs at the helm, it’s easy to be tough on the team. Davel’s created a quality, consumer-focused product and now has to test ways to convince users to pay for the online service, a challenge this publication sympathises with.
22Seven is now available in beta and will eventually cost you R70 a month. “I guarantee, if you use it, you will come out with more money,” said Davel. We will be watching. DM
Photo: Christo Davel
Harvard's first black faculty member was a dentist. Dr George Franklin Grant also invented the wooden golf tee.