Student management

Scout raises $2.6 million to turn student-athletes into investors

Scout, an app designed to help people establish early investing habits, recently raised $2.6 million in a seed funding round. So far, the company has focused on getting users on college campuses, and especially sports facilities.

Scout CEO Michael Haddix Jr., a former college basketball player and son of NFL running back Michael Haddix, has traveled the country training athletes at 20 institutions and creating an app to make it easier for them to build a long-term plan.

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“They have no income, do they? So the standard idea of, Take 20% and put it here, doesn’t really apply to them,” Haddix said in an interview. But between cost-of-living allowances, academic performance benefits and sporadic NIL deals, college athletes have more and more money to play.

Scout builds personalized “starter pack” investment plans for each user, mixing personal interests (food, games, luxury items, pets, technology, etc.) with diversified stocks and bonds. Users can set up recurring deposits or have their “reserve currency” invested each time they make a purchase. The app also aims to educate along the way, while mixing gifs, emojis and colloquial language.

A number of athletes invest in Scout itself. Chingona Ventures led the round, joined by OneTeam Partners, Chris Paul, Vernon Davis and Jimmer Fredette, alongside other venture capital groups (BDMI, OnDeck, Reach Capital, Gaingels, Hustle Fund, Alive VC and Broadhaven Ventures) and individuals (Tim Fong, Jay Kapoor and Kyle Hines). The startup plans to make money from subscription revenue and management fees.

“Financial education and encouraging young people to prioritize it has always been important and I have a unique opportunity and responsibility to use my platform to deliver this life-changing message to everyone.” Paul said in a statement. “Mike has long been a trusted advisor to young athletes, but what really drives him and his reason for starting Scout is an underlying desire to inspire the next generation of kids from all walks of life to not only succeed , but to take ownership and active participation in saving and investing for their future.

In addition to educating the athletes, Haddix hopes the players will “in a way be our standard-bearers on campus,” given the formal and informal leadership roles they often fill in college communities. “I’m going to make sure we help the players who get these checks get on the right track,” Haddix said, “but also using them as an example for everyone else.”

More than half of the app’s current users are athletes. The average user has around $5,000 in savings.

The Public Investing app has also dabbled in educating athletes with a specially designed financial literacy program that includes $100 to get started, informational workshops and the chance to earn referral bonuses.

Scout hopes to separate itself from other investment apps aimed at younger users by emphasizing actively managed recurring diversified investments on one-off transactions, as well as other money management tools such as expense analysis. For example, a demo shows how investing $12 a month that would otherwise be spent on fast food adds up in the long run.

“There are so many young investors who have been scared off by the market or don’t have enough information and are keeping money in savings accounts,” Haddix said. “So inertia is another big, big contender.”

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