Perch Credit: The Journey of an SEP Startup
Sigma Eta Pi members have created many great businesses, but some end up going above and beyond. From getting investment from Jay-Z’s VC firm to getting into Y Combinator, Perch Credit, created by Ayush Jain and Michael Broughton of SEP’s USC chapter, is certainly in the latter category. In celebration of Perch Credit’s recent launch, we decided to interview Ayush about Perch’s journey and his experience as a college entrepreneur. If you are a college entrepreneur or thinking about starting your own business, we hope this article can be a source of inspiration for you!
What is Perch?
Ayush: Perch is a mobile app that allows users to build their credit score using non-traditional data points, such as rent, Netflix, utilities, and other recurring payments. We do this by furnishing on-time payments from our users to the US Credit Bureaus. This data can be backlogged up to 2 years, allowing you to see a significant boost in their credit score in under 30 days. This is much faster than the 6–8 months it takes to build your credit using a credit card or loan.
How did Perch begin?
Ayush: Although Mike and I came together to take Perch from an idea to a business in SEP, Perch’s story really started with Mike’s struggle to get a loan to cover his USC tuition. Coming from a military family of nine, he was disqualified due to family finances, a lack of a credit score, and no proof of credit history. With no means of accessing financial products, Mike ended up building his credit with his past rent payments, giving him the experience that millions of Americans have gone through, paving the way for Perch.
How did you and Michael meet and decide to become partners?
Ayush: Mike and I first met in SEP during the “New Member Welcome.” However, it wasn’t until later that Mike pitched his idea to us. At the time it was really just an idea and I myself had little experience with the credit industry. My main strength was that I had years of product development experience under my belt in highly specialized spaces like AI, aerospace, biotech, and commercial underwriting, so I knew jumping into financial technologies would be well within my capabilities. Paired with Mike’s keen business sense and vast knowledge of the credit space as the youngest board member of the USC Credit Union, we had a feeling it would be an incredible team. We ended up in the same SEP group (huge thanks to Tommy Cheng, Angela Zhang, and Angel Zhang) and officially became co-founders later that year.
How did you decide to go all in and drop out of school? Was there a specific milestone you hit or a moment when you knew this could become something big?
Ayush: Personally, formal education never really appealed to me, so making the decision to drop out wasn’t a very hard one. I think the moment that really confirmed this for me was the day we got into Y Combinator for the S20 cohort. That same day, I had a major midterm for my Applied Combinatorics class, but when I sat down to take the test, I knew it was finally time. I ended up writing a note to my professor about the news and walked out after handing the empty paper.
What was your funding experience like?
Ayush: Our funding experience started off really rough as our business is highly dependent on partnerships and integrations, and at the time we first started raising for pre-seed investment, we were barely getting by with third-parties. We eventually got past this by launching unscalable MVPs, refining our story, and winning pitch-competitions (kudos to Mike). That brought us to the attention of Marcy Venture Partners (Jay-Z’s VC firm) who ended up being our first investors. Not too long after that, we got into YC and the rest is history.
What’s been the experience working full time on Perch and living in a “hacker house”?
Ayush: Working full time in the “hacker house” has truly been a once in a lifetime experience. Living and working in the same place can be extremely stressful as there tends to be little work-life balance. But at the same time, I think it allows for extremely fast-paced development cycles and quick pivots when needed. In many ways, I think this made the entrepreneurial journey far more manageable with Covid-19 as we’ve always been able to support each other in the team through the tough times.
What role has SEP played in your entrepreneurial journey?
Ayush: SEP played a huge role in my journey as it allowed me to meet like-minded, ambitious individuals at USC. Throughout my time at USC, I joined the majority of exclusive business, CS, and entrepreneurship clubs. But of all the ones I joined, SEP was the one where I formed some of my closest friendships and met people with some of the craziest startup ideas. I knew SEP was a place where action mattered a lot more than words which was why I ended up being so involved in the club even after my first semester in it.
What are your goals with Perch?
Ayush: I really want to see Perch in the hands of all those who have been overlooked by the credit system. A product like ours has so much potential to break millions of Americans out of financial disparity and empower them with the knowledge to remain in control of their finances. I’d also like to see an exit, whether that’s an acquisition or an IPO but we’ll have to see how things pan out; it’s definitely a bit too early to tell right now.
While creating a startup in college is certainly a big endeavor, we believe nothing should hold you back from going for it. There will be difficulties along the way, but the reward of creating something great is something worth sacrificing for. A huge shoutout to Ayush and Michael for their amazing work and for being an inspiration to us all. We look forward to seeing Perch grow as a company and impact lives.
