FLATIRON DISTRICT — New York’s “Silicon Alley” has welcomed yet another new addition — a startup aptly named Tykoon that is dedicated to helping kids learn the intricacies of personal finance.
The online platform was launched about a year ago by Doug Lebda, the founder of LendingTree.com, and Mark Bruinooge, an entrepreneur and former Bank of America executive.
As the company continues to grow, both founders have decided to base the company in 2,100-square feet of space at 37 W. 20th St., amid the Flatiron's many other tech companies that have already set up shop.
“The location allows us to kind of be in the middle of everything,” Bruinooge explained, adding that the community of startups in the neighborhood is a supportive and collaborative one.
The area is home to tech companies both large and small. The popular review site, Yelp opened its Manhattan headquarters close by, on Fifth Avenue near Union Square, last fall.
General Assembly, which bills itself as "a campus for technology, design and entrepreneurship," recently moved from 902 Broadway to a bigger space at 915 Broadway, near East 21st Street.
And in April, the neighborhood will host its first-ever NY Tech Day, an event catering to startups in need of a little business-world guidance.
Now, Tykoon is jumping into the mix with its staff of about six. It plans to hire more as the business grows, Bruinooge said.
Bruinooge and Lebda decided to develop the online platform based on their experience trying to teach their own children how to manage their money.
The program they’ve developed over the past year functions like a virtual bank account for kids. As children complete chores and other tasks, they earn an allowance and can watch their nest egg grow. When kids spend, they watch their balance decrease.
In addition to helping kids track their spending, Tykoon allows parents to stipulate how much their children need to save and how much they should donate to charity.
In Bruinooge’s household, for example, his 7- and 10-year-old sons have to save 20 percent of their money and donate 20 percent before they can spend the remaining 60 percent.
"It’s not about Mom and Dad saying 'No,'" Bruinooge said. "The product actually gives parents and kids a basis to have a conversation.
"Most of the users, the families, have really responded positively to feeling empowered."
Tykoon has forged partnerships with several outlets to facilitate the donating and the spending. Amazon connects kids with age-appropriate purchases, and children can review more than 50 charitable organizations that are aligned with the startup to choose which cause should receive their hard-earned cash.
No money is actually deposited through the online program, and when children want to make a transaction — be it a donation or a purchase — parents need to pull out their debit or credit cards, Bruinooge said.
But the program’s co-founders hope that it is teaching children to strike a balance in managing their finances.
"Really, we wanted to create a site…that helps parents manage what we call the money conversation," Bruinooge explained. "The kids' experience is connected to real giving, real spending and real saving."
So far, 400 families have signed up for Tykoon, which translates into roughly 1,200 users, Bruinooge said. Most of the children using it range in age from 8 to 12-years-old.
The plan to make Tykoon profitable continues to evolve, Bruinooge said. The program is free now, but there are plans to create a premium version that will come at a price and offer a bit more in the way of financial educational materials.
Tykoon also receives some money through the partnership with Amazon, Bruinooge said, and the co-founders envision additional corporate collaborations in the future.