Pact Raises $1.5M to Help People Hit Health Goals by Putting Money on the Line
A motivational startup called Pact has raised $1.55 million, led by Khosla Ventures and Max Levchin, for its mobile apps, which help people set monetary stakes for meeting their goals.
Users pledge via iOS or Android app to pay at least $5 if they fail to complete one of their committed workouts. And all those who do complete their goals gets cash rewards split out from the flakers — generally 30 cents to 50 cents per workout.
Now Pact wants to apply the same ideas to eating, so it is broadening both its name and focus. New versions of the app under the new brand are set to launch January 1.
Unlike some other goal-setting apps, which often subsist on button clicking and social pressure, Pact tries to hold users to their word. It validates workouts using phone accelerometers that track a minimum of 30 minutes of activity, or by connecting to FitBit and RunKeeper.
For food challenges, Pact will connect to MyFitnessPal for meal logging — and a day only counts for credit if users track at least 1,200 calories eaten across three meals. It will also offer an option for daily fruit- and vegetable-eating commitments, where users submit mobile photos.
“The very special thing about Pact is that our financial incentives are very motivating,” said Pact co-founder Yifan Zhang in an interview today. ”We are 92 percent effective at getting people to hit their commitment. The average user stays with a pact for six months.”
Okay, but what about the kind of sadistic twist that Pact is fostering urges for users to punish themselves for bad behavior?
“I think the strongest incentive is the negative incentive,” Zhang said. “It doesn’t mean the motivation comes from you paying money; it comes from you having money on the line.”
Zhang said she has faith that Pact has broad appeal, given that only 20 percent of its current users live in major cities. “There are lots of people in suburbia — regular people — trying to get healthy,” she said. Future versions of the app may include new pacts for categories like sleep and weight loss.
Pact has raised a total of $2.4 million across two seed rounds, and has a team of 14 people based in San Francisco. It currently takes a 50-cent fee on each cash transaction.