While working for a big-box company, Clarence Bethea needed service on his laptop, but he’d lost his receipt, and his warranty was nowhere to be found.
Frustrated, he founded Upsie. The Minneapolis-based warranty company now protects thousands of customers and millions of dollars of technology, and it works to counter issues common to retail-sold protection.
“We all hate going to the register at a big-box store, checking out and them offering us a high-price, no-transparency warranty,” Bethea said during a visit to Benzinga's downtown Detroit newsroom as an advisor to — and 2016 alumnus of — Village Capital’s 2017 Fintech Program.
Part of Upsie’s goal is to educate consumers, many of whom are pressured to make on-the-spot warranty purchases while unaware that retailers significantly mark up the service.
As Best Buy Co Inc (NYSE:BBY) provides two-year smartphone protection for $199.99 and Verizon Communications Inc. (NYSE:VZ) for $264, Upsie covers the product for $79.99. Its three-year laptop warranty runs for $246.22 compared to Best Buy’s $349.99 and Apple Inc. (NASDAQ:AAPL)’s $249.99.
“It’s really nothing special that we do,” Bethea said. “The retailers are greedy. A lot of their bottom-line profit is built up inside of the warranty business, so they don’t have the opportunity to come down and price match us.”
About 40 percent of clients purchase warranties prior to buying their products, and the rest act within a 45-day post-purchase window on smartphones and 60-day window on other devices. The 18-month-old company completes transactions on the company website and app.
Image Credit: Benzinga CEO Jason Raznick sits with Upsie's Clarence Bethea to discuss fintech.