In the first half of 2024, Albert Wang was working as an oil trader at Morgan Stanley, and his co-founder, Eric Xu, was a quantitative portfolio manager at Hudson River Trading. They were comfortable, deeply entrenched in the data-driven world of predictable market volatility. Then, a mutual friend introduced them to an entrepreneur pitching an angel investment opportunity.
It was an idea Wang now calls the "exact opposite" of their current venture.
"His idea was more like a punitive budgeting tool," Wang recalls. "Whenever you spend over budget, the app... will take money away from your bank account, lock it up into an investment management account, and then recommend to you a product that’s cheaper. When we heard about the idea, we were like, ‘Well, only my Asian parents would sign up for me,’ and no one would actually want to use it.’ "
But it sparked a revelation. The pair concluded that while legacy credit card rewards systems had essentially stopped evolving, the consumer of the 2020s was starved for a more novel financial experience.
"Nobody’s actually been really excited about their personal finance offerings," Wang said in an exclusive interview with This Week in Fintech. "The consumer in the 2020s clearly wants something different – not access to B-tier lounges that you maybe use twice a year if you’re a frequent traveler, or like $200 of yoga pet credit."
Coverd co-founder Albert Wang
Instead of punishing consumers for spending, the duo decided to use their quantitative backgrounds to build Coverd: a gamified personal finance ecosystem centered around a Visa credit card that offers users the chance — albeit a small one — to earn up to 100% cashback on everyday purchases.
After spending more than half a year navigating the complex legal framework necessary to make the concept a reality, they quit their jobs in the second half of 2024. Backed by just shy of $8 million in combined pre-seed and seed funding from top-tier investors – including Andreessen Horowitz’s a16z Speedrun accelerator, Astute, Wonderco, Bolt Capital, and Yolo Group – the now eight-person company set up shop in New York City.
Inside the "Tesseract": How 100% Cashback Actually Works
To the average consumer, the promise of “up to 100% cashback” might sound like a marketing gimmick destined for bankruptcy. But according to Albert, predicting consumer behavior is significantly easier than predicting the volatility of the energy and equity markets he and Xu used to trade.
"Our full-time job was to predict price movements and price volatility," Wang said. "It turns out people’s spending patterns and habits are actually much easier to predict... If we aggregate 10,000, 20,000 of you, and given the times of day, times of month, and what you’ve already spent, we’ll have a pretty good idea of what can be forecasted."
By understanding these cohorts and knowing their total upper credit limits, Coverd claims it can accurately forecast the merchant interchange fees it will collect. The startup then aggregates past and future fees into a rolling, dynamic prize pool.
Every swipe of the physical Coverd card – issued in partnership with stablecoin payments platform Rain, a Visa principal member – essentially acts as an entry into this pool. The mechanics are governed by a multi-dimensional public matrix they call the Tesseract, which scores transactions based on variables such as category, time of day, dollar amount, location, and the last two digits of the user's card.
“For example, right now it's 1:38 PM," Xu noted during our interview. "I can tell you that from 1:38 PM to 1:45 PM, transactions in food and drinks› from $10 to $25 with cards ending in '00' will get 100% cashback. If you meet four out of five criteria, you get 50%. Three out of five, maybe 20%, maybe 10%. We publish this payout matrix... and we give users total transparency.”
While lucky hits pull in the 100% returns, Coverd targets an overall average baseline of 2.5% cashback across its user base. The system is naturally optimized for smaller daily transactions.
“If you buy a $20,000 or $30,000 car, it’s very unlikely that you get 100%, versus a $12 coffee,” Xu noted. “It will be largely contingent on how much people are spending around the time you’re spending."
The Road Ahead: From Beta to Liftoff
Though the card officially opens to the public on Thursday, Coverd has already quietly stress-tested its ecosystem. Using a Plaid integration, early beta users were able to link their existing cards to Coverd's rewards platform to simulate the experience, racking up $25 million in transaction engagement.
"People link their other cards to get the same type of experience, and we give daily free bonuses... to gauge engagement," Wang said. "Users sometimes buy rewards points because they’re not satisfied with only the free option, but when the card is live, we think the primary way for people to get rewards points will be from the card."
As the waitlist approaches 50,000 applicants – growing at a clip of roughly 1,000 new signups a day – Coverd will begin a tightly controlled, phased rollout on Thursday to mitigate operational risks.
Once users accumulate rewards, they can either redeem them as standard statement credits or pool them into community-driven "games of skill, games of chance, and contests" hosted on the app, competing for items such as World Cup tickets, Coachella passes, or even simple Chipotle gift cards.
When asked about near-term monetization, Wang appeared unbothered, drawing parallels to tech giants who focused heavily on initial consumer scale. Coverd currently generates revenue from merchant interchange fees and the margin built into their rewards contests.
"The goal right now is really not to be profitable…but rather to introduce a new paradigm that users respond very well to," Wang said. "Just like Facebook, YouTube, Uber, it was not critically important that they were immediately profitable in the beginning.”
The ultimate vision for Coverd stretches beyond credit cards. The founders plan to leverage the high-engagement, gamified consumer footprint to eventually cross-sell serious fintech products, including refinancing options for student loans, auto loans, and mortgages.
"We want to be a full-suite personal finance platform," Wang emphasizes, pointing to a broader shift where Gen Z and Millennial audiences have widely adopted gamified platforms like Duolingo for education and Popshop Live for retail. “All of these can be categorized as entertainment, but people don’t spend 100% of their time and money on entertainment, whereas actual personal finance spending is more important.”
In a written statement, Josh Lu, partner at Andreessen Horowitz Speedrun, said he believes that Coverd is defining “an entirely new category” in consumer payments “just as Duolingo redefined how a generation learns languages and Kalshi brought prediction markets into the mainstream.”
“The appetite for interactive, experiential financial products is real, and it is growing,” Lu added. “Coverd is the first company to bring that to everyday spending in a way that actually works at scale.”
(Disclosure: Plaid is the parent company of This Week in Fintech; it does not have any say in our editorial process)
