Kevin and I decided to switch things up at TabTab around Christmas of last year. After launching our product, getting over 1k app downloads from this TikTok, and receiving amazing feedback from acquaintances and strangers alike, we were both ecstatic. The work we put into making the product was paying off, and we were ready to add tons of new features through rapid build sprints.
We personally emailed, texted, and/or called every single person that signed up. We had tons of feature requests ranging from modifications to our onboarding flow, to enabling funding of accounts via debit/credit card, to even facilitating general household expense splitting. Admittedly, the lack of consistency in the feedback we got was confusing.
Two things, however, were unequivocal:
People liked our product, but were largely unwilling to pay for it.
We weren’t communicating our features or pricing model very well.
At first, the former was only a mild concern. With sufficient users and traction, we thought, we would eventually figure out how to monetize the app. So, with feedback from our users in mind, we scoped and designed a completely new UX for our app:1
Midway through the sprint, however, Kevin and I started having conversations about the novelty of our product (which we also had prior to launch). Peer to peer payment apps (Venmo, Paypal, CashApp, Zelle) exist and — despite the fact that they don’t have recurring payments — are pretty awesome and completely free to use. Did we really want to spend this time we were taking off school creating a slight variant of something that was invented over a decade ago? We weren’t sure, and we weren’t sure we could do a better job than them.2
We also weren’t sure of this “figure monetization out later” approach. TabTab was pretty capital intensive:
Sending payments via ACH using Dwolla cost us 1% of the total value of every transaction + $0.05.
Securely authenticating a user’s bank account using Plaid cost us $2.50.
Obtaining subscription transaction data from Plaid cost us $0.30 per user per month.
This meant we had to approach the business with a “raise or die” mentality: either take money from VCs to finance growth (disclosure: we’ve already raised some money), or implode because we can’t pay for our users to sign up. It was an uncomfortable dilemma, as Kevin and I:
Really value having a large portion of our business,
Want the ability to decide to work on something different for whatever reason
Slash was a natural response to both our personal and product concerns. We now make money by charging merchants (interchange), we’re building something that didn’t previously exist (with a lot more potential applications/room to grow), and most importantly, are better serving the needs of our customers.
Excited for what’s to come!
P.S: Huge thank you to everyone that has written about or mentioned TabTab in a blog/news article/newsletter, including:
 I am admittedly somewhat salty that we never got around to building this version of the product. It’s probably the most thorough and organized design work I’ve done in my life! Feel free to open the Figma file in full screen and sift through the pages.
 If we wanted to migrate from making peer to peer payments via ACH to making transactions be free and instant (entries in a database), we would most likely have had to get something called a Money Transmitter License, which takes a couple of years and can cost millions of dollars. Andrew Kortina sent me a useful google doc with notes he had compiled on the subject.