Rumor Mill: Intuit to Acquire Mint.com for $170 Million
An interesting post on TechCrunch caught my eye this morning. They are reporting that Intuit is a few days away from announcing the acquisition of Mint.com. The deal is valued at an estimated $170 million. It is certainly a great feat for Mint.com, and outspoken CEO Aaron Patzer. At the 2008 Celent Innovation & Insight Day, I had the pleasure of having Aaron sit on a panel I was moderating on Web 2.0 (see the following summary in Bank Systems & Technology).
What are the ramifications of this deal? It’s a bit of a bizarre acquisition since Digital Insight (an Intuit company) already has a PFM 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 PFM. They clearly want to control the market as Mint claims well over 1 million users and Quicken has been quick to boast that it is not far behind. It’s also the final jab at the already dead Microsoft Money. How Intuit will add Mint.com to this product suite remains to be seen, but is certainly not immediately apparent. There are a few challenges with this acquisition:
- There is a big difference between number of users and number of ACTIVE users. Total number of users is a meaningless figure. Anyone can sign up for an account, try the service, leave, and never come back. The number of active users is not a publicly available figure and they are the ones that really matter here. Intuit will obviously acquire Mint’s user base as part of this deal and it would be useful to know more precise figures regarding active users.
- Mint’s business model is questionable. Mint has always been clear that they believe consumers should take care of PFM with them instead of with a bank. While they have been successful at growing their user base, it’s unclear if they have actually been able to generate revenue. They started off with a model based on referrals and suggestions (e.g. suggest a new credit card that may be better than the one you currently have). In May announced that they “may begin to sell anonymous consumer data” (see my blog entry, The Risks of PFM Revealed), a practice I am very much against.
I would also like to point out that this could be good news for banks who are looking at their PFM options. A combined Mint/FinanceWorks solution offered to financial institutions could prove to be a compelling option. This could be particularly appealing to midsize to large banks who want to work with an experienced vendor like Digital Insight / Intuit.
UPDATE 11:43am. Intuit confirms Mint.com acquisition