Swipely is one of the up-and-coming e-commerce companies that's trying to focus on the "social customer." What is a social customer? They're the vocal and transparent ones using all sorts of social media to publicize their opinions and actions. In the case of Swipely, social customers are sharing their purchases with every credit card swipe. Hence the name.
In this episode of Vator Box, where we look at startups and analyze their prospects, we take a look at Swipely. Our guest host for this episode was Jed Katz, a venture capitalist at Javelin Venture Partners, a VC firm with $75 million under management. Jed joined myself and Ezra Roizen, digital media investment banker at Ackrell Capital.
Swipely is Angus Davis' latest company, which is riding the re-emergence of a wave called "social commerce" - the use of social networking to aggregate relevant information about commerce transactions, to ultimately encourage or influence commerce. Swipely raised $8.5 million, with $7.5 million coming just last month from leading venture capitalists, Greylock and First Round Capital. Prior to this Series A, Swipely raised $1 million from high-profile angel investors, such as Ron Conway. Angus Davis co-founded TellMe with Mike McCue. TellMe was sold for some $1 billion to Microsoft.
Here's our takeaway:
- Is there a way to "not" have the publishing aspect of all the credit card swipes but still be able to collect the data so that consumers can get relevant deals pushed to them? Said in another way, consumers will probably like the idea of getting rewards for making more purchases and getting recommendations. The question is whether most of them will want it publicized.
- Not all consumers want to share everything. So, sharing some things, like restaurants visited might be something people might want to share. If there was a filter on what kinds of events to share, that would be a good feature.
- There is a risk of having adding a lot more noise to the system. There is a PR risk that Swipely publishes something they're not supposed to.
- If this company gets the execution right, they can be huge. Swipely is going to have tons of information about the consumer. Its relationship with the consumer - if it can deepen it - will be worth a mint. Mint, which also tracks and owns valuable financial information about its customers, sold to Intuit for $115 a user.
- How does this company set itself apart from Blippy? Blippy shows the purchase amount of its customers whereas Swipely hides that information. Aside from this difference, it's unclear what their difference is. Personally, I like when the purchase price is shown.
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