Accounting Made Easy: BillMonk Formalizes IOUs
“BillMonk helps you avoid the awkwardness of borrowing and sharing. We track the debts that might otherwise be forgotten, and we do the cumbersome money-math,” the company says.
In short, BillMonk helps a circle of friends keep track of who owes how much to whom. For example, a user wants to report a debt like shared rent or an IOU to another person. He or she simply enters it on BillMonk.com.
This is easy to do, says a review by Michael Arrington of TechCrunch.com, even for more complicated transactions, such as a bill shared among a lot of people. Simply input the amount of the bill and the e-mail addresses of those who participated.
The BillMonk software keeps the balance and sends out payment reminders, says Business 2.0 Magazine. Now, when the check comes for dinner, the young party of five can avoid those awkward moments of dividing up the bill at the table. It gets paid by whomever has cash on hand, then BillMonk will let you know later who owes whom.
But who will remember to log it into BillMonk in the morning? No need. It can be done by cell phone that night.
The Seattle-based service is the creation of two former Amazon.com software designers, Gaurav Oberoi, the chief architect, and Chuck Groom, who coined the term “social money.” The company claims 10,000 users as of today, its six-month anniversary.
The concept of paying by cell phone is not new and is in fact an exploding technology market. However, John Cook, Seattle Post-Intelligencer venture capital columnist, called BillMonk original in its notion of “combining elements of social networking with bill paying.”
The founders estimate that billions of dollars of informal debts go untracked each year, worldwide–accounting that is relegated to notebooks, sticky notes, or just mental notes. “If we just focused on roommates in the U.S. alone, according to the 2000 census we'd have 22 million potential users,” Oberi told eHub.
While unique in its marketing demographic, the pay-by-cell-phone field is exploding with companies such as PayPal, Obopay, TextPayMe, Billmycell and MyTango.