Printer Friendly

Intuit continues shopping spree with online provider Mint.Com buy.

Marking its second major buy over the past few months, Intuit Inc. said it will purchase online personal finance provider Mint.com in a cash transaction worth approximately $170 million.

Launched in September 2007, Mountain View, Calif-based Mint.com allows users to set up an account on its Web site and then add their credit card, bank, home loan and investment accounts for the online provider to manage for free. According to its Web site (www.mint.com), the company tracks more than over $175 billion in transactions and $47 billion in assets.

The deal is the latest for Intuit, also based in Mountain View, Calif. In June, the company announced that it would buy PayCycle Inc., an online payroll service provider to small business members and customers for $170 million. Digital Insight, an Intuit company, provides online banking services to credit unions and midsize banks. Both deals could expand the credit union industry's reach within the small business and consumer finance market.

"This deal is a huge win for Mint.com. It represents an admission on its part that its business model wasn't sustainable over the long term," Aite Group Senior Analyst Ron Shevlin said. "While Mint's interface is superior to Intuit's FinanceWorks and has functionality that FinanceWorks doesn't have, it's not clear why Intuit would pay $170 million to acquire those capabilities."

Mint.com says it has 1.4 million registered users, which means Intuit is paying approximately $120 per user, he explained. Because users do not pay, there is no immediate revenue for Intuit.

Intuit said it intends to keep both the Mint.com and Quicken Online offerings, with each serving separate and equally important purposes. Mint.com will become the primary online personal finance management service that is offered directly to consumers by Intuit. After the transaction is complete, Mint.com will become part of Intuit's consumer group, which includes both Quicken and TurboTax products. Aaron Patzer, Mint.com's founder and CEO, will become general manager of the personal finance group. Patzer will be responsible for online, desktop and mobile consumer personal finance offerings.

Jacob Jegher, senior analyst with Celent, a Boston-based financial research and consulting firm, also wondered if the transaction is in Intuit's best interests.

"It's a bit of a bizarre acquisition since Digital Insight already has a personal finance management product called FinanceWorks that they are offering to financial institutions, as well as Quicken Online which is a consumer-direct product. There is, however, no doubt that Intuit is all-in when it comes to [personal finance management]."

Jegher said Mint's business model is questionable because while the company has been successful at growing its user base, it is unclear if they have been able to generate revenue.

-msamaad@cutimes.com

COPYRIGHT 2009 Summit Business Media
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2009 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Author:Samaad, Michelle A.
Publication:Credit Union Times
Date:Sep 23, 2009
Words:456
Previous Article:Credit unions receives scant attention at CRA hearing.
Next Article:Debate on NCUA merger policy emerges after California roundtable.
Topics:


Related Articles
Intuit tight-lipped about PayCycle acquisition's impact on credit unions.

Terms of use | Privacy policy | Copyright © 2021 Farlex, Inc. | Feedback | For webmasters |