NEW YORK--(BUSINESS WIRE)--Yotta set out in July of 2020 to help people save more money with the prospect of winning between 10 cents and $10M in weekly prize drawings through a prize-linked savings account. Since then, Yotta has grown to over 130,000 accounts, $200 million deposited into FDIC-insured accounts, and recently crossed $1 million in prizes and savings bonuses awarded to platform users.
Co-founders Adam Moelis and Ben Doyle founded Yotta in 2020 with the notion that it is difficult for people to adopt habits that are healthy in the long run but menial in the short run—and the data proves this. 40% of Americans are unable to pay for an unexpected $400 expense in the event of an emergency, but the average household in the U.S. spends $710 per year on lottery tickets. These trends are due in part to the fact that there is no short-term reward for savings, but lotteries provide immediate feelings of hope and excitement.
Yotta aims to bring this excitement into saving and make putting away money—something routine and boring that we all should do more of—as exciting as winning the lottery. For every $25 deposited, Yotta users earn one recurring ticket into weekly sweepstakes number draws. Users can select their own numbers for drawings or let the Yotta app randomly select numbers on their behalf. Yotta users all stand to win the $10M jackpot prize, with more frequent, smaller-sum rewards also available. Even if you’re not a prize winner, your FDIC-insured account with Yotta still earns a 0.20% savings bonus, over 3x the national average interest rate on savings accounts.
Today, the company is announcing the close of a $13.2M Series A, led by Base10 Partners with participation from YCombinator, Core Innovation Capital, and Slow Ventures. Notable backers of Yotta in their previous round include Cliff Asness and Ken Moelis. This round comes just a few months after the company announced its initial Series Seed in August of 2020. Yotta has raised $17.7M to date and plans to use the fresh capital to expand into other gamified financial services and banking offerings for consumers, including debit and credit cards.
“Yotta’s recent exponential growth is what attracted us to the company, and we are equally excited by the potential for societal good their platform stands to bring to people across the U.S.,” noted TJ Nahigian, Managing Partner at Base10 Partners. “Adam and Ben are out to change habits for the better and we’re proud to be partnering with them.”
Moelis and Doyle drew inspiration from lottery savings programs that are incredibly popular in other countries and were recently legalized in the U.S. in 2015. In the UK, “Premium Bonds” are the #1 method for individual savings, with 33% of the UK’s population depositing over $100B. New Zealand and South Africa have similar programs, and Moelis and Doyle believe Americans can improve their financial situations by using Yotta’s prize-linked savings account. Moelis and Doyle were featured in Forbes 30 Under 30’s Social Impact category this past winter.
“Savings accounts have worked the same, boring way for decades,” said Adam Moelis, CEO and co-founder of Yotta. “We are excited to make saving money and managing personal finances fun, so that it’s easier for Americans to build up their financial safety net.”
Yotta is an NYC-based financial technology company that offers free FDIC-insured bank savings accounts and rewards savings account depositors with weekly prize drawings with prizes ranging from 10 cents to the $10 million grand prize. Get started today at withyotta.com.
About Base10 Partners
Base10 is a San Francisco-based early-stage venture firm investing in Automation for the Real Economy. Founded by Adeyemi Ajao and TJ Nahigian, the firm invests in technology companies that are bringing automation to sectors of the Real Economy, including industrial logistics, consumer logistics, restaurants, financial services, and sales & customer service. Portfolio companies include ThePillClub, Virtual Kitchen Company, Popmenu, and others. Connect via base10.vc.