Most people would agree that the warranty system for gadgets and appliances purchased at big-box retailers leaves a whole lot to be desired. Plans are pushed on consumers at the register, sometimes to the point of harassment, and the worst part is that these plans rarely offer a good value proposition.
We all want to protect our major purchases, but paying a large fraction of the cost of the product for that peace of mind can be difficult to justify, and it’s especially stressful trying to make that decision while being pressured at the point of sale.
It was a problem in need of a technological solution, believed Clarence Bethea, and this was the inspiration behind Upsie, a new mobile app that offers the same warranty coverage you’d get from other companies at a much lower price, and with far more convenience. The app went live for iOS and Android in late November.
“Consumers are getting charged way too much for protection plans,” says the Twin Cities entrepreneur, adding that these warranties are often marked up by as much as 200 percent when sold in stores.
Based in Minneapolis, Upsie works with Texas-based New Leaf Service Contracts as a gateway to insurance providers, and Bethea says that through this arrangement, his app can offer product insurance on electronics and appliances at a cost that is often 50 to 90 percent lower than the plans peddled in retail shops or online. You can elect to buy coverage any time within 60 days of the purchase. To determine whether an item you’re considering is eligible for coverage, you can search within the app or simply scan the barcode.
Not only is the pricing more affordable, but Upsie also adds convenience by housing all necessary documents and details within the app so there’s no need to keep track of paperwork and there will never be confusion surrounding the length or terms of your coverage. You can also use the app to make and manage a claim.
This service was developed as a response to the consumer pitfalls associated with the aforementioned warranty sale process at big-box stores, and to ensure that Upsie can effectively navigate away from that path, Bethea has brought in two former Best Buy employees: John Anderson, who is director of operations, and Daniel Fleischman, who runs the business development side.
Bethea likens Upsie to the models of Lyft and Airbnb — tech solutions that deliver value by cutting out corporate middlemen and putting power in the hands of users.
“New Leaf and our carriers don’t work for us. We’re just a technology that’s creating the link between the two, and we’re taking a margin out so that the consumer can win.”
That margin is the sole revenue stream for now, but he sees additional opportunity down the line in terms of personalization and expanding to different areas of the insurance realm beyond electronics.