Kiddie Kredit founder Evan Leaphart wasn't sure what to expect when he sent a cold pitch to Equifax (NYSE: EFX), one of the country's premier credit reporting agencies.
He didn't have an inside connection with the company; in fact, he didn't even have a direct email address to contact. Instead he pitched his startup Kiddie Kredit, a platform that teaches children about credit scores, in a message to Equifax's general inquiries email address. Then, he hoped for the best.
That email was forwarded to the company's president. A few days later, they hopped on a call, and a partnership was born.
"The lesson is, never doubt the power of cold calling," Leaphart said.
This month, Equifax officially announced it teamed with Miami-based Kiddie Kredit to teach kids about financial literacy. The platform's downloadable app uses a 1-100 scoring system to reward children for completing household chores. Aimed at users ages 4 to 12, the goal is to instill positive habits in children that help them become financially literate adults.
The strategic partnership also aims to help lower- and middle-income individuals improve their own credit scores. In the long term, that will enable them to build wealth by qualifying for better mortgage rates to purchase homes and small business loans to start their own ventures.
"Working with Equifax gives us a massive potential distribution channel because they access to a majority of America's adult population," Leaphart said.
Not everyone understood the potential behind Kiddie Kredit when Leaphart founded the startup in 2018. At first, he struggled to communicate the company's potential in a way that piqued the interest of venture capitalists. Instead of emphasizing the product's market potential, he tended to focus on the social good it could spark by improving the finances of low- and middle-income users. It was a learning experience he took to heart.
"If you're trying to get capital and reach certain targets, like an acquisition or IPO, you have to be able to narrate that vision," he said. "When I started, I didn't understand that quite as much."
Leaphart turned to crowdfunding as an alternative to venture capital, eventually raising $75,000 for Kiddie Kredit in 80 days. The firm is also backed by more than $37,000 in angel investor funds and a $10,000 grant from WeWork.
Moving forward, Kiddie Kredit will create a financial literacy product targeted toward teens and young adults who don't have a credit history. Eventually, the company may even issue credit products, like credit cards, to its users.
It wasn't a straight path, but Leaphart said working with Equifax is confirmation he's on the right track with Kiddie Kredit.
"There's only three main credit bureaus in the U.S. So having a partnership with even one has been a very big validation," he said.
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