Delicious For Money

I've been using Quicken since April 7, 1988. I know that because Quicken sits open 24/7 on a windows desktop in my office and I just checked to see the date of the first transaction. I remember that time well. It was the spring of 1988 and the Gotham Gal and I had gotten married after living together for five years and had just purchased our first home, a one bedroom apartment. It was time to get serious about money and at that time (the mid 80s), getting serious about money meant Quicken.

Quicken's taken us a long way, from two kids who had to borrow money from our parents to come up with the down payment for that apartment to two middle aged adults with three kids and the financial freedom to do what we want. The financial controls we put in place and managed with Quicken got us through some tough spots when we had no money and at ton of expenses.

I've been thinking a lot about the age question, particularly in light of Clay Shirkey's post where he said, "In the last 15 years or so, I’ve had to unlearn every one of those things and a million others". I am a child of the desktop software era, not the web era. I grew up playing with Radio Shack, Apple, and IBM desktop computers. That took me to MIT and on to the VC business. The Googles of my generation are Microsoft and Apple.

But I know one thing, the web changes everything. It's a better platform. And so we are moving on from Quicken. To a service called Wesabe. The Gotham Gal blogged about it earlier this month and I've been meaning to do the same ever since. Wesabe is a web based financial management service. It allows you to upload all the accounts you transact in (checking account, credit cards, etc) and manage your spending on the web. There are other services like Wesabe and more are coming, but right now Wesabe is the best fit for our needs.

Wesabe is a social tag-based web app and in that statement lie to the two reasons I think its vastly superior to Quicken.

Wesabe is social meaning that it's not an island of information sitting on my home desktop computer. I certainly don't want others seeing my personal financial information and Wesabe is obsessed with data security, maybe a tad too much for my taste. But it is still a social app. When it sees that I am spending $100 per month at Astor Wines, it makes the connection to others who frequent the same wine store so we can connect and talk about what we like and don't like and possibly find other places to buy wine in the neighborhood.

Wesabe uses tags to categorize information. Most accounting services use the standard hierarchical accounting conventions that every transaction has to be placed in a single category. The dinner we had on vacation with my brother in law has to be placed in either dining or vacation, or possible the dining subcategory of vacation. In Wesabe, you just tag it with as many categories as you want, dining and vacation for sure, and maybe also my brother in law's name and sushi and fantastic to boot. You never know when you are going to need that info. It's a fundamentally different way of organizing data and once you've gotten used to tagging instead of foldering, you can't really go back.

Here are some screen shots that show what I am talking about. These are a few transactions from my American Express account.

You'll see that each of them has multiple tags. I use the tag FB to symbolize my personal budget. The Gotham Gal and I have managed our discretionary spending since the early days of our lives together with two budgets, hers and mine. Each have a monthly number attached to them. Beyond staying in budget, we manage our discretionary money the way we choose without recrimination from the other side. It works like a charm and I recommend it to everyone. But you'll also see that the transactions have other tags. While Emusic goes into my budget, it's also a music expenditure and a monthly subscription. You'll also note the tips. When Wesabe sees others who use the same vendor, they generate user tips. They can be really helpful.

Here's some more detail on the Emusic vendor.

This showcases the social side of Wesabe. You can see that Wesabe knows a lot about Emusic and is sharing that with me. I love that and hope they do more with this aspect of the service over time.

We are using Wesabe and Quicken in parallel right now. Old habits die hard. But I can feel it already. Quicken's toast. It's just a matter of time before we pull the plug on that windows machine in my office and don't replace it. The web's a better platform for everything, managing your personal finances included.

Comments

[scotty the body]

Wow! I hdad heard of it, but haven't had time to check it out. You've enticed me to do so.

One of the key leverage (I guess that's the word) points for truly useful social networking is where it interfaces with your life. Browsing (delicious, etc.), music listening (TBD, but last.fm is a good start), and now, through your economic participation in society. I really can't think of a better point of interaction than that, honestly. I'm already imagining all sorts of future utility:

"Did you know that your friend Fredwilson switched from Vendor x to Vendor y and saved $30/month on the same service you just paid for?"

"That vendor you just paid has a history of disputes with your friends... ask them more about it"

etc. etc. etc.

VERY cool!

[Zoli Erdos]

Fred,

Does Wesabe provide the transactional basics, like auot-download of checking and credit card transactions, online paymnents ..etc?

I found a reference to data export in the FAQ, but it wasn't clear whether it's automated or manual.

Thanks.

[Michael]

I made the HUGE mistake of upgrading Quicken last year for the first time in about 5 years. IMHO, the older version(s) were much better -- way less bloat and didn't try to steer you to Quicken's online services. Ever since I've *upgraded* I've been regretting that decision and looking for an alternative. I may have to give Wesabe a try although I'm hesitant about having all my financial info online no matter how obsessed with security the site/service is.

[Kristian Hansen]

Wesabe is an amazing service. In March I met up with Jason Knight, their CEO, in Berkeley to talk more about the future of Wesabe and how he sees it working in the future.

I am really glad to see that Wesabe is gaining market traction.

Jason is one of the most accessible CEO's that I know. His phone number is listed on the website and he really picks up the phone between noon and two pm to answer customer questions.

If you doubt it, try calling one day.

KLH

[Bill Erickson]

Zoli, it doesn't auto-download the information, but it does give you two ways to get it in there:

1. You can download the data file from your bank account and then upload it in Wesabe; or,
2. Use the Wesabe Uploader (a desktop app a lot like the Flickr Uploader) and just press the upload button. It will do all the downloading/uploading, and tell you the last date of upload.

I love wesabe and its embrace of the social qualities and tags. My only problem with tags is I like to see a breakdown of all of my expenses, and tags makes it much more difficult. If you tag everything with multiple tags, and then view expenses by tags, the total expense will be MUCH more than your real total expense (because everything will be counted multiple times). I've found myself using 4-5 basic tags like food, car, misc... so that I can see a good breakdown of spending. If I want more information on it I put it in the notes.

[Mitch Rubin]

Last year I decided that I wanted as many of my applications as possible to be web based and accessible from anywhere. I use a Windows desktop and Macbook when I’m traveling and wanted to use a software as a service accounting program. The Intuit hosted solution seemed like a good starting point until I realized that it only supported IE as a browser and would only run on Windows. This is worth repeating: web-based and only runs on Windows. Same story with Peachtree. My first reaction was “these dinosaurs just don’t get it.” My second reaction was “what an opportunity!”

These are the kind of things I come across in life that keep my entrepreneurial side forever optimistic. Big companies tend to lose vision and move too slowly, opening the door for small businesses who can execute innovative ideas quickly.

I’m looking forward to checking out wesabe. I can’t wait to get rid of Quicken and the old Windows machine it’s running on.

[Marc Hedlund]

Thanks much for the great post, Fred, and thanks for all the comments.

Zoli/Bill -- Bill's description of upload is correct right now, but as a note, we're currently testing a new way to upload that we think is pretty cool. Drop me a line at marc at wesabe dot com if you want to join the test program.

Bill - You're completely right about tags overlapping. We're working on a new feature that we think addresses this concern. If you have particular requests, I'd love to hear them, and again, please feel free (everyone) to send me mail directly.

We also have a group on Wesabe called "Make Wesabe Better," where we get lots of feature requests. If you find we're missing something, mentioning it there will often get you suggestions from other users, or supporters for getting us to act on it quickly! Please feel free to drop by.

Thanks again.

Marc Hedlund, co-founder, Wesabe

[Rob Long]

Wow. I remember getting into Quicken not too much after 1990, when I was 24, and for the first time ever, I actually had money to keep track of. I remember the incredible feeling of power and efficiency I got when I printed out all those neatly stacked checks, and the sfx of the "save transaction" button, halfway between a cash register and one of those old Pitney Bowes postal machines.

What's cool about Wesabe, from the way you describe it, is the way it integrates a pretty private and (formerly) very personal thing -- your spending; your money -- into a social sphere. So whatever nervousness a person has about putting their data up on the web is mitigated, I think, by the feeling you get knowing that you're not alone -- other people are spending money at Wally's Wine, other people are paying Allstate every month, other people are writing checks to the same dry cleaner....in one way, that's what the web has always been for me: a way to feel less isloated, less alone. (Ironic, of course, that most web interaction occurs when you're alone!)

In another way, it evokes another one of the web's great powers: it aggregates. If customers of a business can all find each other quickly and easily, imagine how responsive that business is going to have to be.

So whatever hesitation people have about data security, or privacy, is probably overcome by the twin feelings of connectedness and power. Cool. If I wasn't incredibly lazy and didn't have an accountant do all that stuff for me, I'd sign up. Actually, maybe I will anyway...

[DAR]

I know you and others have been lauding Wesabe for some time now, Fred, but I have to say I'm still pretty dubious, for the following reasons:

First off, security. Perhaps their security is excellent, but for me the issue is confidence. I have much more confidence in my own personal ability to keep my financial data secure than in someone else - simple as that. Yes they're secure today, but they're much more likely to get hacked in the future than my own personal PC. And perhaps they keep your personal information nicely private today, but what about in the future after they go IPO, change management, get bought, etc. What's to prevent "Wesabe by Bank Of America" from abusing and selling my personal data?

Second, frankly I just don't see a burning need for a "social financial community" site. I'm not really all that interested in having social interactions around every financial transaction in my life. When I want social interaction about something, I can easily seek it out and it's a mouse click away. I just don't see these features as being compelling enough to attract users.

Frankly, Wesabe strikes me as one of those things that the "blogosphere" loves, but will never gain widespread adoption.

Don't get me wrong - I hate Quicken, and Intuit is at least as much of an abusive monopolist as Microsoft. But I don't see a web-based, social version of it as the solution. An open source version of Quicken (or some variation on that idea) is the real solution to this problem, IMO.

[Bill Davenport]

I wonder if there's an opportunity to aggregate the data into some useful market research info. For example, to use Fred's screenshot, how are revenues accelerating for eMusic based on Wesabe's users? That'd be great data to have for public/tradeable companies and wouldn't seem to me to violate user privacy. I had thought about starting up an institutional investment service a while back where MSN Money/Quicken users could upload their data and get rights to the aggregate analytics while the company could then resell the rolled up data but Wesabe already has the data so seems an even better opp for this.

[Charlie Crystle]

The web is not a better platform. It's part of a better platform, which is the web and desktop together, a hybrid web: the power of the desktop seamlessly integrated with web services. code should run where it serves the user best. Sometimes it's the web, sometimes it's the desktop, sometimes it's both. Google and Skype are great examples of that. As is our GiftWorks fundraising software, and soon SalesWorks, which are both seamlessly integrated with the web but outperform any web application.

[Dave Schappell]

Fred -- thanks for an introduction to another service that sounds just right for where I am right now.

As a loyal reader, I want to thank you for saving me tons of time by filtering the seemingly accelerating influx of new apps that are out there.

One request -- could you create and manage a list of the key applications that you use for each major area of your life (sort of an 'App Roll' or a 'Web 2.0 App Roll'? I know that seems like a lot of work, but for folks who are new to A VC, I think it would be really useful to see the social apps that you've merged into your life, and then link them to the article(s) tagged with those apps so that we can see how and why you've made the switch.

An example of where this would be helpful for me is that I'm still wrestling with "what is the right Outlook replacement on my new MacBook Pro?". I finally made the switch to the Mac and have been struggling with Entourage; however, I'm pretty certain that GMail and GCalendar are in my very near future. I'd love to know if your experience validates that decision (since you've probably made your decision based on many more interactions with folks who have tried the hundreds of alternatives).

In any case -- thanks for the Wesabe intro!

Dave

[ellen]

How would I keep my husband from seeing all that I purchased at Neimans if I used Wesabe? This is a bit too open for me.

[Alan]

I'm excited about Wesabe. I've been looking for a web based alternative to MS Money for a while. A few months ago I discovered both Wesabe and Yodlee Moneycenter about the same time. I completely ditched Money after getting Yodlee set up, it's a much more traditional approach (along the lines of Quicken) but much cleaner, web-based, and no manual downloads (also has bill pay, funds transfer, reporting, etc.). That said, your wife's post about Wesabe reminded me to check it out again. I like it, but haven't gotten my workflow down yet with the manual uploading process. From what I can tell, my bank (Wachovia) requires me to download and import it manually, I haven't been able to get the uploader to get the data. For now I'm consider Yodlee my money management tool, but I'm going to keep an eye on Yodlee.

[howard lindzon]

Man I dont get it. Something to make you more anxious than even spending the money in the first place.

Obviously I wish it well, it is smart and ambitious, and their are many anal eople that want this.

Maybe if they bundled with Prozac and Lifelock i would FEEL better about it.

I like DAR's comments

Disclosure - Long Lifelock

[zhongliu]

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[Arjun]

I've tried wesabe, but unfortunately was somewhat disappointed. Their interface is a bit clunky.

Keep an eye out for mint.com. I have a feeling they're going to be awesome..

[josh]

I don't get it. I just signed up, transferred my accounts. Tagged everything hoping to get to some kind of zen bliss of understanding where my money goes. But the tagging system is a bit silly. The web page says the CEO is available for calls, so I called him. He was away, so I emailed him. Lets see what he says.

So far, it lets me tag things - Good. Auto-tags some things - OK. Doesn't let me set up auto-tagging rules (e.g., any transaction with the 'ATM' in it gets tagged 'atm') - Bad.

It has tips. They are pretty useless and generic at the moment. I guess they might get better with time.

It lets me set up goals. But until the tagging system works properly this is pretty useless.

[Ethan]

One of the main ways I use Quicken is to plan financial transactions. Basically, balancing my checkbook so I don't overdraw. I can't move to Wesabe until I can enter future scheduled transactions, and I also would like to see a balance transfer function so that transactions on two different accounts can be linked...