The abrupt shuttering of FiLife, a well-known personal finance destination backed by IAC and Dow Jones Interactive, has loosed speculation that the site was paying for clicks to reach its eye-popping 3.4 million monthly unique visitors. I made a bad call on this one, highlighting FiLife's "exploding traffic" in my Most Innovative Company entry—and some finance reporters whispered at the time that the wool had been pulled over my eyes.
Former CEO Ezra Kucharz, who departed for CBS just after the site's traffic took a nosedive, had no comment. Nor did their former PR firm Ketchum.
Regardless of how the accusations play out, the disappearance of FiLife begs the question of why it’s been so difficult to get personal finance right on the Web. Every year, it seems, the Finovate conference bows a host of promising startups like Thrive, Wesabe, Geezeo Buxfer, Tile Financial and Rudder. All promise to make saving, credit, and investment easy for bewildered customers, especially the members of Generation Debt.
Thrive (which I also wrote about) was rumored to have been shuttered in a fire sale to Lending Tree in February 2009, followed quickly by the departure of founder Avi Karnani. Geezeo dropped its consumer-facing services in January in favor of serving banks. The others—save for Mint.com—have failed to make much of a dent in terms of traffic or awareness. Why is that?
Maybe money is just too hard to discuss. Personal finance is the very definition of a "pain point" in a nation with $2.5 trillion in consumer debt. It’s a topic of intense privacy—more so than sex or health. Distrust of financial institutions is at an all-time high.There are fraud and identity theft concerns (late last week some members of the social finance site Blippy saw their credit card numbers appear on Google). And there are major trust issues when a personal finance company makes its money from advertising or recommending consumer financial products.
The shining exception to most of this is Mint.com, which has over 3 million users—more than double since they sold last fall to Intuit for $170 million. (Disclosure: I moderated an Intuit Town Hall event on kids and money with Mint founder Aaron Patzer and his father just this morning.) Is their software, which automatically categorizes and visualizes transactions from tens of thousands of merchants, really that much more powerful and easy to use than the competitors? Can a bunch of pretty pie charts actually make people forget that they are looking at something as dismal as their credit card bill? Can they keep their integrity and trust with users while recommending products and introducing features that are more about goal-setting than simply tracking spending?
Now that Mint is owned by a much larger company, will they be able to keep listening to users in the way that made them so successful? (A positive sign, as we've noted, is that Intuit put Patzer in charge of Quicken as well. )
All remains to be seen. But there are still a lot of clueless people out there who need help with their finances—41% of Americans surveyed in 2009 gave their own personal finance knowledge a grade of C, D, or F.