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Higher Education's Last Mobility Engine

· Charlotte Fintech,Fintech Accelerator,QC Fintech 2017

How Edquity Provides the Platform that Students, Schools, and Society Need

“Higher education is the primary mobility engine and it has eroded,” says David Helene, CEO of Edquity. “Whether you can succeed in college is now largely dictated by how much money you’re born into.”

David Helene and Max Wilson, co-founders of Edquity, recognize that they fall into the lucky category. The two friends, who both studied economics, graduated from Yale in 2012.

However, they aren’t comfortable with the status quo — and they’re concerned for everyone if the status quo persists.

“It is tragic and morally reprehensible that at an individual level, certain students are set up for a lifetime of financial hardship simply because they were born into an environment in which they have no access to meaningful counseling resources,” David says. “When you add it up at the macro level, this is also how societies fall apart.”

Thus the catalyst for Edquity, the college financial planning platform built to support students through all financial pressures related to college. The solution, which serves both high school and college students, is an admittedly intricate solution to a complex problem and is one that certainly wasn’t formulated overnight.

“Edquity is the product of a long evolution of thinking and one that required a long time to truly understand the nuances of the problem — I’d honestly say I began thinking about this issue four years ago,” David explains.

Four years ago, after eating Pepe’s pizza and playing club soccer together during their Yale years, David and Max were working their first post-college jobs in New York City. Max worked in a behavioral economics lab at Columbia University and David in the communications umbrella of The Clearing House, a financial trade association. David’s day-to-day highlighted the inability of banks to communicate effectively to consumers. And, pushed the term “systemic risk”, risk that could bring about the collapse of an entire financial system or market, to the forefront of his vocabulary.

“'Where are next greatest systemic risk concerns?’ was something that came up a lot at The Clearing House,” David says. “I personally became concerned with the macro risks posed by the student loan market — not to mention the human implications.”

David approached Max, the Chief Product Officer of Edquity, with his half-baked idea to help at-risk high school students prepare for and understand the long-term implications of student debt. And in turn, reduce the credit risk of at-risk student borrowers. David and Max — along with their third co-founder Georges Clement — founded UniFi Scholars, a non-profit provider of college financial planning education for low-income high school students. While growing UniFi Scholars, research came out that made David, Max, and Georges pivot.

“While $100,000k in student debt is never a great thing, it turns out big dollar student debt isn’t driving the majority of default. It’s small dollar default — the result of dropout,” David explains. “And the number one driver is financial pressure.”

David and Max realized that their students needed support around the financial implications of their various college decisions from start to finish. They also realized that education wasn’t enough — students needed something dynamic, personalized, and action-oriented.

While UniFi Scholars allowed David and Max to make a big impact on 400 individuals, they founded Edquity to make an impact on a large scale.

“The scale and complexity of this problem require a scalable solution that facilitates accessible decision making. Providing education and then saying to the student “now go figure it out” doesn’t cut it,” David says.

David and Max say the advantage for Edquity is that the economic relevance of this issue extends beyond the 70% of students on financial aid at colleges.

“This is a problem that affects all of us,” says David. “If a student is hampered by debt or by an inability to earn, they can’t spend, they can’t invest, they can’t save, they can’t buy a house. They’re less valuable to financial institutions, less valuable as consumers, and they make their colleges look bad. Everyone has an incentive to step up and solve for this issue.”

The Edquity team understands why their platform is necessary for all — and how to get kids to use it. They understand the challenges that face Edquity such as the notoriously slow sales cycle in education and the personal effects of losing face time with the students they want to help, something that they all value immensely. But, they are optimistic because they are passionate about the problem they want to solve. Edquity is ready to transform how students engage with the college process and do their part in making post-secondary pathways a reality for all socio-economic classes.

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