Vator Box

5

Google Ventures on Vator Box checks out Wipit

A look at mobile payments for the cash-preferred and prepaid consumer

Innovation series by Bambi Francisco Roizen
July 18, 2011 | Comments
Short URL: http://vator.tv/n/1cb7


(Correction: To reflect founder bios)

There's about 42 million people who are underbanked (those without access to credit cards) or unbanked (those without bank accounts) in the US alone. How do you give those consumers cash-payment options that are similar to the convenience of a credit card? It's a problem many want to solve, including Wipit, a promising new mobile startup with a solid pedigree.

Wipit's founders include John Tantum, founder and former President of Virgin Mobile USA, Michael Lanzon, former VP of Sales & Marketing of Boost Mobile USA, and Richard Kang, former partner at VHA, the largest distributor for Boost Mobile in the US. Wipit was recently a top 10 finalist at our Vator Splash LA startup competition and event this past May. 

So, we invited the Wipit founders to participate in Vator Box, our fast-paced show where entrepreneurs present their promising ideas or early-stage businesses in front of prominent angels or investors in Silicon Valley.

In this episode, Joe Kraus, partner at Google Ventures, is our guest host, joining Ezra Roizen and me. We take a look at Wipit, a mobile payment startup for the underbanked. John Tantum, co-founder and Chairman, kicks it off with his 90-second pitch.

Without diving into too much detail, here's some highlights:

- Wipit's transaction solution would cost merchants a similar amount that merchants currently pay to credit card companies. Wipit would, however, enjoy improved margins because their costs to execute would be lower, according to John.

- The Wipit solution works similar to PayNearMe, a well-funded competitor backed by Khosla Ventures and August Capital, to name a few VCs. If a consumer wants to pay by cash, he or she would have to go to a Wipit partner store to pay out the cash. The consumer would then get a credit to make a payment.

- On competition from PayPal, larger competitors, such as banks, who might move into this market, John said that he doesn't believe that it would be a focus area for such competitors as the complexity requires significant focus on just this problem.

- Joe's final feedback was positive, as he essentially said he'd take a meeting with Wipit. "What’s interesting is that you’re building a marketplace – customers that are putting cash in their accounts. And merchants accepting the cash... Two-sided markets take a long time to get started. But once they get started, they have incredible network effects to keep people out... I came in [to Vator Box] pretty skeptical because there’s Goliaths in this space. But I would be interested in a follow-up."

Watch the rest to see the kind of questioning and feedback Joe and Ezra provided, as well as John's pitch, response and answers.

For more on Wipit, watch Richard Kang give his presentation at Splash LA (hit video/documents on Wipit profile to see video), and feedback from VC/judges - Jed Katz (Javelin Venture Partners), Manu Rekhi (Inventus Cap), Michelle Wroan (KPMG), and Ron Bloom (Mevio).

(If you want to be on VatorBox, please write the [email protected])


Related companies, investors and entrepreneurs

Plogo_paynearme_paynearme_lowres
PayNearMe
Startup/Business
Description: PayNearMe combines a modified cash load network with an application technology platform so that consumers without credit or debit cards&m...
7924
Wipit, Inc.
Startup/Business
Description: Wipit is an early-stage venture in the burgeoning mobile payments industry focused on enabling the cash-preferred consumer to make mobil...
30232
Jed Katz
Managing Director,
Javelin Venture Part...
Bio: Jed Katz, Managing Director, Javelin Venture Partners One of the pioneers of Internet commerce, Jed has spent his career developing, a...
Bio: Manu is a seasoned internet executive and Venture Partner at Inventus since 2008.  Manu brings a well respected oper...
Bio: Joe has been with Google Ventures since 2009, and his primary areas of focus are mobile, gaming, and local services. Prior to Google Vent...
73546
Ron Bloom
Chairman and CEO,
Mevio
Bio: Ron Bloom is the visionary Chairman and CEO of MEVIO, the world's premier Independant Online Video Entertainment Network. Mr. Bloom ...
62
Ezra Roizen
General Manager,
STRATEGYfx, LLC
Bio: Advisor and commenter on emerging ventures, focused on digital media, e-commerce and mobile companies.My transactional activities are per...
90_70_default_profile_pic
John Tantum
Executive Chairman,
wipit

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