Menu

Timesdelhi.com

March 23, 2019
Category archive

eCommerce

Zeus raises $24M to make you a living-as-a-service landlord

in 2nd Address/Airbnb/Apps/Delhi/eCommerce/Finance/funding/Fundings & Exits/garry tan/India/initialized capital/Personnel/Politics/Real estate/Recent Funding/Sonder/Startups/TC/Venture Capital/zeus by

Cookie-cutter corporate housing turns people into worker drones. When an employee needs to move to a new city for a few months, they’re either stuck in bland, giant apartment complexes or Airbnbs meant for shorter stays. But Zeus lets any homeowner get paid to host white-collar transient labor. Through its managed ownership model, Zeus takes on all the furnishing, upkeep, and risk of filling the home while its landlords sit back earning cash.

Zeus has quietly risen to a $45 million revenue run rate from renting out 900 homes in 23 cities. That’s up 5X in a year thanks to Zeus’ 150 employees. With a 90 percent occupancy rate, it’s proven employers and their talent want more unique, trustworthy, well-equipped multi-month residences that actually make them feel at home.

Now while Airbnb is distracted with its upcoming IPO, Zeus has raised $24 million to steal the corporate housing market. That includes a previous $2.5 million seed round from Bowery, the new $11.5 million Series A led by Initialized Capital whose partner Garry Tan has joined Zeus’ board, and $10 million in debt to pay fixed costs like furniture. The plan is to roll up more homes, build better landlord portal software, and hammer out partnerships or in-house divisions for cleaning and furnishing.

“In the first decade out of school people used to have two jobs. Now it’s four jobs and it’s trending to five” says Zeus co-founder and CEO Kulveer Taggar. “We think in 10 years, these people won’t be buying furniture.” He imagines they’ll pay a premium for hand-holding in housing, which judging by the explosion in popularity of zero-friction on-demand services, seems like an accurate assessment of our lazy future. Meanwhile, Zeus aims to be “the quantum leap improvement in the experience of trying to rent out your home” where you just punch in your address plus some details and you’re cashing checks 10 days later.

Buying Mom A House Was Step 1

“When I sold my first startup, I bought a home for my mom in Vancouver” Taggar recalls. It was payback for when she let him remortgage her old house while he was in college to buy a condo in Mumbai he’d rent out to earn money. “Despite not having much growing up, my mom was a travel agent and we got to travel a lot” which Taggar says inspired his goal to live nomadically in homes around the world. Zeus could let other live that dream.

Zeus co-founder and CEO Kulveer Taggar

After Oxford and working as an analyst at Deutsche Bank, Taggar built student marketplace Boso before moving to the United States. There, he co-founded auction tool Auctomatic with his cousin Harjeet Taggar and future Stripe co-founder Patrick Collison, went through Y Combinator, and sold it to Live Current Media for $5 million just 10 months later. That gave him the runway to gift a home to his mom and start tinkering on new ideas.

With Y Combinator’s backing again, Taggar started NFC-triggered task launcher Tagstand, which pivoted into app settings configurer Agent, which pivoted into automatic location sharing app Status. But when his co-founder Joe Wong had to move an hour south from San Francisco to Palo Alto, Taggar was dumbfounded by how distracting the process was. Listing and securing a new tenant was difficult, as was finding a medium-term rental without having to deal with exhorbitant prices or sketchy Cragislist. Having seen his former co-founder go on to great success with Stripe’s dead-simple payments integration, Taggar wanted to combine that vision with OpenDoor’s easy home sales to making renting or renting out a place instantaneous. That spawned Zeus.

Stripe Meets OpenDoor To Beat Airbnb

To become a Zeus landlord, you just type in your address, how many bedrooms and bathrooms, and some aesthetic specs, and you get a monthly price quote for what you’ll be paid. Zeus comes in and does a 250-point quality assessment, collects floor plans, furnishes the property, and handles cleaning and maintenance. It works with partners like Helix mattresses, Parachute sheets, and Simple Human trash cans to get bulk rates. “We raised debt because we had these fixed investments into furniture. It’s not as dilutive as selling pure equity” Taggar explains.

Zeus quickly finds a tenant thanks to listings in Airbnb and relationships with employers like Darktrace and ZS Associates with lots of employees moving around. After passing background checks, tenants get digital lock codes and access to 24/7 support in case something doesn’t look right. The goal is to get someone sleeping there in just 10 days. “Traditional corporate housing is $10,000 a month in SF in the summer or at extended stay hotels. Airbnb isn’t well suited [for multi-month stays]. ” Taggar claims. “We’re about half the price of traditional corporate housing for a better product and a better experience.”

Zeus signs minimum two-year leases with landlords and tries to extend them to five years when possible. It gets one free month of rent as is standard for property managers, but doesn’t charge an additional rate. For example, Zeus might lease your home for $4,000 per month but gets the first month free, and rent it out for $5,000 so it earns $60,000 but pays you $44,000. That’s a tidy margin if Zeus can get homes filled fast and hold down its upkeep costs.

“Zeus has been instrumental for my company to start the process of re-location to the Bay Area and to host our visiting employees from abroad now that we are settled” writes Zeus client Meitre’s Luis Caviglia. “I particularly like the ‘hard truths’ featured in every property, and the support we have received when issues arose during our stays.”

At Home, Anywhere

There’s no shortage of competitors chasing this $18 billion market in the US alone. There are the old-school corporations and chains like Oakwood and Barbary Coast that typically rent out apartments from vast, generic complexes at steep rates. Stays over 30 days made up 15 percent of Airbnb’s business last year, but the platform wasn’t designed for peace-of-mind around long-term stays. There are pure marketplaces like UrbanDoor that don’t always take care of everything for the landlord or provide consistent tenant experiences. And then there are direct competitors like $130 million-funded Sonder, $66 million-funded Domio, recently GV-backed 2nd Address, and European entants like MagicStay, AtHomeHotel, and Homelike.

Zeus’ property unit growth

There’s plenty of pie, though. With 330,000 housing units in SF alone, Zeus has plenty of room to grow. The rise of remote work means companies whose employee typically didn’t relocate may now need to bring in distant workers for a multi-month sprint. A recession could make companies more expense-cautious, leading them to rethink putting up staffers in hotels for months on end. Regulatory red tape and taxes could scare landlords away from short-term rentals and towards coprorate housing. And the need to expand into new businesses could tempt the big vacation rental platforms like Airbnb to make acquisitions in the space — or try to crush Zeus.

Winners will be determined in part by who has the widest and cheapest selection of properties, but also by which makes people most comfortable in a new city. That’s why Taggar is taking a cue from WeWork by trying to arrange more community events for its tenants. Often in need of friends, Zeus could become a favorite by helping people feel part of a neighborhood rather than a faceless inmate in a massive apartment block or hotel. That gives Zeus network effect if it can develop density in top markets.

Taggar says the biggest challenge is that “I feels like I’m running five startups at once. Pricing, supply chain, customer service, B2B. We’ve decided to make everything custom — our own property manager software, our own internal CRM. We think these advantages compound, but I could be wrong and they could be wasted effort.”

The benefits of Zeus‘ success would go beyond the founder’s bank account. “I’ve had friends in New York get great opportuntiies in San Francisco but not take them because of the friction of moving” Taggar says. Routing talent where it belongs could get more things built. And easy housing might make people more apt to live abroad temporarily. Taggar concludes, “I think it’s a great way to build empathy.”

News Source = techcrunch.com

Can there be too much competition between startups?

in alibaba/Amazon/China/Delhi/eCommerce/India/JD.com/jumia/Kai-fu Lee/Luckin Coffee/Politics/The Extra Crunch Daily/Venture Capital by

Competition is the core of capitalism. Competition between companies lowers prices — on average — and ensures that they are forced to innovate lest they lose their markets to others. Competition between workers ensures that people strive to do their best work lest their jobs go to more qualified or faster or cheaper replacements.

Obviously, there is a spectrum here from lethargic monopoly to cutthroat competition that causes more problems than it’s worth (environmental damage in the hopes of cutting costs, fraud, deceit, etc.). Drawing that line though is really, really hard though, and there are unfortunately not many non-academic discussions of how much competition is needed to spur innovation.

You’re reading the Extra Crunch Daily. Like this newsletter? Subscribe for free to follow all of our discussions and debates.

So it was surprising to read an entire chapter about this dilemma comparing China and the U.S. in Kai-Fu Lee’s book AI Superpowers (yes, yes, I am dreadfully behind on this particular book review).

While the book is about AI, Lee is trying to undo American conceptions of Chinese innovation early on in the text. Yes, the country was once a copycat haven, but that has changed as the learnings of copying have led to originality:

The first act of copying didn’t turn into an anti-innovation mentality that its creator could never shake. It was a necessary steppingstone on the way to more original and locally tailored technology products.

In his narrative, American (tech) companies didn’t fail in China because they were incompetent, but rather because they never made the effort to localize:

American public companies tend to treat international markets as cash cows, sources of bonus revenue to which they are entitled by virtue of winning at home. […] American companies treat China like just any other market to check off their global list. They don’t invest the resources, have the patience, or give their Chinese teams the flexibility needed to compete with China’s world-class entrepreneurs.

China’s entrepreneurs didn’t just learn how to build products quickly from their early copying, but also learned that they had to ferociously compete for markets:

The sheer density of competition and willingness to drive prices down to zero forced companies to iterate: to tweak their products and invent new monetization models, building robust businesses with high walls that their copycat competitors couldn’t scale.

Lee’s ultimate point is that by focusing on markets instead of mission, Chinese startups move far faster and more aggressively to seize opportunities. But that also means that there are can be thousands of startups all targeting the same market at the same time, which forces outside-the-box (read: quite possibly unethical or illegal) behavior in order to compete. “For these gladiators, no dirty trick or underhanded maneuver was out of bounds. They deployed tactics that would make Uber founder Travis Kalanick blush.”

I’ve talked a number of times about the “Chinese think Palo Alto is dumpy” problem. But it bears repeating: competition is the key to a startup ecosystem. Competition forces founders to move faster, to hire quicker, to make product decision with alacrity and otherwise to win their markets today and not a year from now. The best founders in Silicon Valley founders understand this, although this secret seems to be increasingly lost today.

History, of course repeats. Just yesterday, it was revealed that Chinese caffeine chain Luckin Coffee received a $200 million loan from investment banks in prep for an IPO. From Julie Zhu and Kane Wu at Reuters:

The firm officially launched its business only in January last year and in July raised $200 million in its maiden funding round that valued it at $1 billion, making it one of the fastest-ever firms to make the ‘unicorn’ milestone.

[…]

The loss-making firm has been expanding at breakneck speed with over 2,000 cafes opened and plans to open 2,500 this year – displacing Starbucks as China’s largest coffee chain in the process.

15 months and larger than Starbucks. That’s speed, and that’s how you compete.

Digging into the S1: Jumia IPO has points for praise and pause

PIUS UTOMI EKPEI/AFP/Getty Images

Written by Arman Tabatabai

Jumia grabbed headlines yesterday after the African e-commerce player filed for an IPO on the NYSE. Our writer Jake Bright covered the news and provided insightful context around Jumia’s business model, its footprint, and the state of e-commerce in Africa.

With Jumia en route to becoming Africa’s first public tech company listed abroad, we dug into the company’s S-1 to get a better understanding of all its moving parts. Generally, the story is pretty compelling: Jumia is one of the largest pan-Africa e-commerce businesses with a large and rapidly growing active user base that is positively levered at Africa’s economic development and mobile adoption.

While the company is burning cash and losing hundreds of millions of dollars each year, that’s hardly uncommon anymore. But one area that gave me pause was the company’s margin breakdown.

To measure the economics and operating performance of the company’s core operations, Jumia uses “platform contribution,” a metric it defines as gross profit — excluding revenue from services outside the core platform — subtracted by fulfillment costs from third-party logistics providers, primarily related to freight and shipping. Using this metric, Jumia’s platform contribution was about 9-11% of sales in 2017-18.

However, Jumia’s metric excludes fulfillment and delivery costs associated with Jumia’s network of warehouses, their fulfillment employees, and other related expenses, with the logic being that these costs are fairly flat year-to-year and less indicative of the variable costs of the business. However, as an e-commerce logistics and delivery provider, the unaccounted for fulfillment costs seem at least relevant, if not core.

If we were to include all Jumia’s fulfillment expenses in the calculation, Jumia’s platform contribution would actually be negative 5-11% in 2017-18. While thin to negligible margins aren’t unusual for scaling e-commerce platforms, Jumia’s margins fall short of levels seen in past prospectuses from some of the e-commerce giants Jumia looks up to. Amazon, Alibaba, and even JD.com all had at least a year of positive margins including total fulfillment costs at the time of their S-1s. (Though to be fair here, none of the three companies are apples-to-apples comps — Amazon’s S-1 was decades ago, Alibaba operated on a completely different scale at the time of its IPO, and JD.com used a different model focused on direct sales).

Still, the numbers here are just a little unnerving within the context of Africa’s previous e-commerce failures, as discussed by Jake Bright:

“Jumia’s move to go public comes as several notable consumer digital sales startups have faltered in Nigeria…

…In late 2018, Nigerian online sales platform DealDey shut down. And TechCrunch reported this week that consumer-focused venture Gloo.ng has dropped B2C e-commerce altogether to pivot to e-procurement. The CEO cited better unit economics from B2B sales.

Jumia also competes with services backed by Amazon and Naspers in several of its markets, which can be daunting when competing on economics.

The other disclosure that had me harping on Jumia’s fulfillment expense was in the “Risk Factors” section, where the company highlighted that it operates in markets with under-developed physical, economic, legal, and institutional infrastructure. And while there’s heavy investment going into African infrastructure — which could act as a growth tailwind for Jumia in the long-run — improving, let alone creating, infrastructure takes much longer than doing the same in normal business operations, as we’ve discussed ad nauseam.

Because of the lack of infrastructure, Jumia openly discusses the difficulties of delivery and stable fulfillment in its markets and has had to build out a lot of operational infrastructure itself. To me, it at least raises questions around how quickly Jumia will be able to get its cost structure down and whether it might take a bit longer compared to some of its global e-commerce peers.

Thanks

To every member of Extra Crunch: thank you. You allow us to get off the ad-laden media churn conveyor belt and spend quality time on amazing ideas, people, and companies. If I can ever be of assistance, hit reply, or send an email to danny@techcrunch.com.

This newsletter is written with the assistance of Arman Tabatabai from New York

You’re reading the Extra Crunch Daily. Like this newsletter? Subscribe for free to follow all of our discussions and debates.

News Source = techcrunch.com

African e-commerce startup Jumia files for IPO on NYSE

in africa/Delhi/eCommerce/Egypt/Fundings & Exits/Ghana/Goldman Sachs/India/IPO/jumia/kenya/Lagos/morgan stanley/morocco/Naspers/Nigeria/online retail/Politics/Rocket Internet/smartphones/Startup company/Startups/TC/tech startup/travel bookings/U.S. Securities and Exchange Commission/unicorn by

Pan-African e-commerce company Jumia filed for an IPO on the New York Stock Exchange today, per SEC documents and confirmation from CEO Sacha Poignonnec to TechCrunch.

The valuation, share price and timeline for public stock sales will be determined over the coming weeks for the Nigeria-headquartered company.

With a smooth filing process, Jumia will become the first African tech startup to list on a major global exchange.

Poignonnec would not pinpoint a date for the actual IPO, but noted the minimum SEC timeline for beginning sales activities (such as road shows) is 15 days after submitting first documents. Lead adviser on the listing is Morgan Stanley .

There have been numerous press reports on an anticipated Jumia IPO, but none of them confirmed by Jumia execs or an actual SEC, S-1 filing until today.

Jumia’s move to go public comes as several notable consumer digital sales startups have faltered in Nigeria — Africa’s most populous nation, largest economy and unofficial bellwether for e-commerce startup development on the continent. Konga.com, an early Jumia competitor in the race to wire African online retail, was sold in a distressed acquisition in 2018.

With the imminent IPO capital, Jumia will double down on its current strategy and regional focus.

“You’ll see in the prospectus that last year Jumia had 4 million consumers in countries that cover the vast majority of Africa. We’re really focused on growing our existing business, leadership position, number of sellers and consumer adoption in those markets,” Poignonnec said.

The pending IPO creates another milestone for Jumia. The venture became the first African startup unicorn in 2016, achieving a $1 billion valuation after a $326 funding round that included Goldman Sachs, AXA and MTN.

Founded in Lagos in 2012 with Rocket Internet backing, Jumia now operates multiple online verticals in 14 African countries, spanning Ghana, Kenya, Ivory Coast, Morocco and Egypt. Goods and services lines include Jumia Food (an online takeout service), Jumia Flights (for travel bookings) and Jumia Deals (for classifieds). Jumia processed more than 13 million packages in 2018, according to company data.

Starting in Nigeria, the company created many of the components for its digital sales operations. This includes its JumiaPay payment platform and a delivery service of trucks and motorbikes that have become ubiquitous with the Lagos landscape.

Jumia has also opened itself up to traders and SMEs by allowing local merchants to harness Jumia to sell online. “There are over 81,000 active sellers on our platform. There’s a dedicated sellers page where they can sign-up and have access to our payment and delivery network, data, and analytic services,” Jumia Nigeria CEO Juliet Anammah told TechCrunch.

The most popular goods on Jumia’s shopping mall site include smartphones (priced in the $80 to $100 range), washing machines, fashion items, women’s hair care products and 32-inch TVs, according to Anammah.

E-commerce ventures, particularly in Nigeria, have captured the attention of VC investors looking to tap into Africa’s growing consumer markets. McKinsey & Company projects consumer spending on the continent to reach $2.1 trillion by 2025, with African e-commerce accounting for up to 10 percent of retail sales.

Jumia has not yet turned a profit, but a snapshot of the company’s performance from shareholder Rocket Internet’s latest annual report shows an improving revenue profile. The company generated €93.8 million in revenues in 2017, up 11 percent from 2016, though its losses widened (with a negative EBITDA of €120 million). Rocket Internet is set to release full 2018 results (with updated Jumia figures) April 4, 2019.

Jumia’s move to list on the NYSE comes during an up and down period for B2C digital commerce in Nigeria. The distressed acquisition of Konga.com, backed by roughly $100 million in VC, created losses for investors, such as South African media, internet and investment company Naspers .

In late 2018, Nigerian online sales platform DealDey shut down. And TechCrunch reported this week that consumer-focused venture Gloo.ng has dropped B2C e-commerce altogether to pivot to e-procurement. The CEO cited better unit economics from B2B sales.

As demonstrated in other global startup markets, consumer-focused online retail can be a game of capital attrition to outpace competitors and reach critical mass before turning a profit. With its unicorn status and pending windfall from an NYSE listing, Jumia could be better positioned than any venture to win on e-commerce at scale in Africa.

News Source = techcrunch.com

Funerals are tough. Ever Loved helps you pay for them

in Amazon/Apps/Delhi/eCommerce/Education/funerals/India/InstaEDU/memorial/Payments/Politics/Recent Funding/Social/social + capital/Startups/TC by

Alison Johnston didn’t plan to build a startup around death. An early employee at Q&A app Aardvark that was bought by Google, she’d founded tutoring app InstaEDU and sold it to Chegg. She made mass market consumer products. But then, “I had a family member who was diagnosed with terminal cancer and I thought about how she’d be remembered” she recalls. Inventing the next big social app suddenly felt less consequential.

I started looking into the funeral industry and discovered that there were very few resources to support and guide families who had recently experienced a death. It was difficult to understand and compare options and prices (which were also much higher than I ever imagined), and there weren’t good tools to share information and memories with others” Johnston tells me. Bombarded by options and steep costs that average $9,000 per funeral in the US, families in crisis become overwhelmed.

Ever Loved co-founder and CEO Alison Johnston

Johnston’s startup Ever Loved wants to provide peace of mind during the rest-in-peace process. It’s a comparison shopping and review site for funeral homes, cemeteries, caskets, urns, and headstones. It offers price guides and recommends top Amazon funeral products and takes a 5 percent affiliate fee that finances Ever Loved’s free memorial site maker for sharing funeral details plus collecting memories and remembrances. And families can even set up fundraisers to cover their costs or support a charity.

The startup took seed funding from Social Capital and a slew of angel investors about a year ago. Now hundreds of thousands of users are visiting Ever Loved shopping and memorial sites each month. Eventually Ever Loved wants to build its own marketplace of funeral services and products that takes a 10 percent cut of purchases, while also selling commerce software to funeral homes.

“People don’t talk about death. It’s taboo in our society and most people don’t plan ahead at all” Johnston tells me. Rushing to arrange end-of-life logistics is enormously painful, and Johnston believes Ever Loved can eliminate some of that stress. “I wanted to explore areas where fewer people in Silicon Valley had experience and that weren’t just for young urban professionals.”

There’s a big opportunity to modernize this aging industry with a sustainable business model and empathy as an imperative. 86 percent of funeral homes are independent, Johnston says, so few have the resources to build tech products. One of the few big companies in the space, the $7 billion market cap public Service Corporation International, has rolled up funeral homes and cemeteries but has done little to improve pricing transparency or the user experience for families in hardship. Rates and reviews often aren’t available, so customers can end up overpaying for underwhelming selection.

On the startup side, there’s direct competitors like FuneralWise, which is focused on education and forums but lacks robust booking features or a memorial site maker. Funeral360 is Ever Loved’s biggest rival, but Ever Loved’s memorial sites looked better and it had much deeper step-by-step pricing estimates and information on funeral homes.

Johnston wants to use revenue from end-of-life commerce to subsidize Ever Loved’s memorial and fundraiser features so they can stay free or cheap while generating leads and awareness for the marketplace side. But no one has hit scale and truly become wedding site The Knot but for funerals.

I’ve known Johnston since college, and she’s always had impressive foresight for what was about to blow up. From an extremely early gig at Box.com to Q&A and on-demand answers with Aardvark to the explosion of online education with InstaEDU, she’s managed to get out in front of the megatrends. And tech’s destiny to overhaul unsexy businesses is one of the biggest right now.

Amazon has made us expect to see prices and reviews up front, so Ever Loved has gathered rate estimates for about two-thirds of US funeral homes and is pulling in testimonials. You can search for 4-star+ funeral homes nearby and instantly get high-quality results. Meanwhile, funeral homes can sign up to claim their page and add information.

Facebook popularized online event pages. But its heavy-handed prerogatives, generalist tone, and backlash can make it feel like a disrespectful place to host funeral service details. And with people leaving their hometowns, newspapers can’t spread the info properly. Ever Loved is purpose-built for these serious moments, makes managing invites easy, and also offers a place to collect obituaries, photos, and memories.

Rather than having to click through a link to a GoFundMe page that can be a chore, Ever Loved hosts fundraisers right on its memorial sites to maximize donations. That’s crucial since funerals cost more than most people have saved. Ever Loved only charges a processing fee and allows visitors to add an additional tip, so it’s no more expensive that popular fundraising sites.

Next, “the two big things are truly building out booking through our site and expanding into some of the other end of life logistics” Johnstone tells me. Since the funeral is just the start of the post-death process, Ever Loved is well positioned to move into estate planning. “There are literally dozens of things you have to do after someone passes away — contacting the social security office, closing out bank accounts and Facebook profiles…”

Johnston reveals that 44 percent of families say they had arguments while divvying up assets — a process that takes an average of 560 hours aka 3 months of full-time work. As the baby boomer era ends over the next 30 years, $30 trillion in assets are expected to transfer through estates, she claims. Earning a tiny cut of that by giving mourners tools outlining popular ways to divide estates could alleviate disagreements could make Ever Loved quite lucrative.

“When I first started out, I was pretty awkward about telling people about this. We’re death averse, and that hinders us in a lot of ways” Johnston concludes. My own family struggled with this, as an unwillingness to accept mortality kept my grandparents from planning for after they were gone. “But I quickly learned was this was a huge conversation starter rather than a turn off. This is a topic people want to talk about more and educate themselves more on. Tech too often merely makes life and work easier for those who already have it good. Tech that tempers tragedy is a welcome evolution for Silicon Valley.”

News Source = techcrunch.com

Hooch moves beyond subscription drinks, with rewards for travel, dining and more

in Apps/Delhi/eCommerce/Hooch/Hooch Black/India/Lin Dai/mobile/Politics/Startups/TC by

When we first wrote about Hooch, it offered a fun, straightforward deal — for $9.99 per month, you could claim one free drink per day from participating bars and restaurants.

Since then, the company launched Hooch Black, a pricier subscription that includes perks like hotel discounts and concierge service. But even then, co-founder and CEO Lin Dai was hinting at plans to use blockchain technology to create what he called “a decentralized model for consumer rewards.”

Now Hooch is delivering on what Dai promised, with a relaunched app that rewards users for their purchases.

“We were super excited about the feedback and response [to Hooch Black] that we saw from our members,” Dai said. “What we decided to do is just completely update the app with rewards for consumers across four different categories — travel, dining, entertainment and e-commerce.”

He noted that while most loyalty programs reward you for using a specific card or for shopping with a specific company, Hooch has partnered with more than 250,000 merchants (including Marriott hotels, TAO restaurants, Starbucks, Uber, and Amazon). The company can actually scan the purchases made on any linked debit or credit card, and you’ll be rewarded whenever you spend money with those partners.

The rewards take the form of what Hooch is calling TAP rewards dollars — the exact reward will vary depending on the merchant, but the company says it could be as high as 10 percent of your spending.

Lin Dai, CEO of Hooch

Dai said TAP dollars are actually a stablecoin pegged to the U.S. dollar, but he emphasized that you don’t need to understand the backend to use the rewards. For most users, TAP dollars will simply be a digital currency that they can redeem for hotel bookings, restaurants credits and gift cards.

“Security is our top concern,” Dai added. The idea is to access your transaction history to verify your purchases (Hooch makes money by driving purchases for merchants), but without storing or sharing identifying information. “When we capture the consumer purchase information, we actually don’t capture any of their names or credit card numbers … We don’t store any identity.”

The program also comes with a big perk for enlisting your friends. There is an upfront reward of five TAP dollars, the real selling point is the fact that you’ll get 20 percent of their rewards — not just on their initial purchases, but for the entire time they use the app.

If you like the Hooch Black plan, you’ll still be able to sign up and pay for it. But the company’s emphasis has shifted to the broader rewards program, which you can join for free.

News Source = techcrunch.com

1 2 3 64
Go to Top