gamification

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Play2Pay raises $13M to convert mobile user engagement into bill payment

The gamification of payments is not a new concept.

A number of companies are attempting to combine gamification and payments in creative ways. And today, one such company, Play2Pay, has raised $13 million in a Series A round of funding.

The Miami-based startup has a straightforward mission. It wants to give consumers a way to reduce their bills — it claims by an average of 30%! — by playing games, watching videos and completing daily challenges, offers and surveys.

Play2Pay was bootstrapped for the first five years of its life, raising its first external capital in June of 2020 — a $7.5 million seed round from individual angel investors. Telesoft Partners led its Series A round, which included participation from Harbor Spring Capital and individual investors including former AT&T vice chairman Ralph de la Vega, former Reuters CEO Tom Glocer, Madison Dearborn Partners co-founder and senior advisor Jim Perry and Virtusa founder and former CEO, Kris Canekeratne.

The alternative payment platform says it brokers a “value exchange” between brands and consumers, converting attention and engagement into a currency, which can be redeemed for bill payment. Meanwhile, brands get a new way to promote their products and services.

Play2Pay founder and CEO Brian Boroff started the company in 2015 based on a vision that prepaid mobile phone users should have an alternative way to pay for their mobile phone service and that wireless carriers would adopt an ad-funded commercial model.

Today, the company claims to be positioned to be the world’s first “ad supported payment rail” directly integrated into payments platforms of major service providers and financial institutions. It also claims to be the only company that converts user engagement directly into bill payment.

Image Credits: Play2Pay

The “opt-in” offering is currently available to more than 100 million mobile subscribers across the United States, United Kingdom, Mexico, Brazil and Indonesia through partnerships with telecom companies such as AT&T Mexico, Cricket in the U.S., TIM in Brazil, lndosat Ooredoo in Indonesia and U.K.-based Lycamobile.

The rewarding approach seems to be resonating with users. From June 2020 to June 2021, the startup saw its ARR (annual recurring revenue) spike by nearly 300%, according to Boroff, a telecom veteran.

Among the users engaged on the platform, about 25% generated revenue daily, he said. And service providers realized up to 17% revenue expansion as a result of subscriber engagement on the Play2Pay platform, according to Boroff.

“Our distribution model is B2B2C, with Tier-1 service providers worldwide directly integrating our bill payment capability. We’re growing our audience through promotion of the service to their customer base,” he told TechCrunch. 

End users, he added, can share their targeting preferences in exchange for value, giving mobile app developers and brands more information when promoting their own products and services to Play2Pay’s audience.

The platform is free for service providers and merchants, meaning the payment does not have costs or fees from interchange, acquirers, chargebacks or gateways.

Instead, Play2Pay generates revenue from mobile app developers and brands. Those developers and brands pay to access Play2Pay’s mobile audience in order to promote their products and services. For example, a mobile gaming company might pay Play2Pay $100 for every user that downloads their app from the Play2Pay app and plays the game for a period of time (such as two hours). Through its technology and partner network, Play2Pay has attribution tracking to ensure that the end user and mobile gaming company both know how much progress has been made toward completing that goal. Other formats include watching videos, completing surveys and more conventional native advertising in some areas.

All of this revenue is aggregated by Play2Pay, the majority of which is passed on to the end user in the form of in-app currency. The balance goes to service providers such as its wireless carrier partners for promoting the Play2Pay platform and to Play2Pay for running the service and processing payment. Play2Pay collects all of the cash and pays out the various parties accordingly.
The company will use the new capital toward product development, hiring and partner engagement.

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Cadoo gets $1.5M to gamify fitness with betting challenges

Cadoo, a US-startup that’s gamifying fitness by turning it into a betting opportunity, using the prospect of winning (or losing) cold hard cash to motivate people to get off the couch, has collected $1.5 million in seed funds from Sam & Max Altman’s Apollo VC and the student-focused Dorm Room Fund.

The app itself has been around since 2018 but in March 2020 it launched a “challenge model” that lets users stake money to join a challenge related to a specific fitness goal — be it running 10 miles in 10 days, or walking three miles in three days.

Participants who achieve the challenge goal get their stake back and a pro-rata share of losers’ staked entry fees.

A range of fitness levels are catered to by Cadoo’s challenges (“from daily steps to marathon training”), with some 50 public challenges hosted per week.

It’s also adding private challenges this month — which will enable users to host and configure fitness challenges for themselves/family and friends, or larger groups, such as companies, clubs, or schools.

Challenge-related activity is verified by the app via API data from activity trackers and fitness apps. (Which hopefully means Cadoo is smart enough to detect if someone has attached their Fitbit to their dog… )

The app has support for a number of third party fitness services, including Strava, Fitbit and Apple Health.

CEO and founder Colm Hayden describes the startup as “DraftKings for your own fitness goals”.

“Our audience consists of 25-50 year old fitness fanatics’ who use Cadoo to stay committed to their monthly/weekly fitness goals,” he told TechCrunch, adding: “When people are serious about a goal they are trying to reach, they want intense motivation to back their ambitions.”

He says the app has attracted around 7,000 wager-loving users so far.

Cadoo’s business model is based on taking a fee from challenge losers before their entry fee stakes are distributed to challenge winners — which does potentially give the business an incentive to set harder challenges than users are able to complete.

But of course it’s up to users to pick which challenges to enter and thereby commit their hard earned cash to.

It also claims that 90% of users who sign up for Cadoo challenges successfully complete them.

Hayden says it has future plans to expand monetization potential by offering winners fitness products — and taking a margin on those products. And also by expanding into other types of verifiable goals, not just running/walking. 

“We are working to build a motivation platform that enables anybody to reach their goals,” he says. “Financial incentives is an intense motivator, and 90% of users who sign up for Cadoo challenges reach their fitness goals. We are making Cadoo much bigger than just running goals, and in the future incentivizing almost any goal verifiable on the internet.”

While the app is US-based payments are processed by PayPal and Hayden says it’s able to support participation internationally — at least everywhere where PayPal is available.

Commenting on the seed raise in a statement, Apollo VC’s Altman brothers added: “Cadoo makes it easy to motivate users to stay active with financial incentives. We believe the motivation industry that Cadoo is pioneering will be an important digital money use-case.”

Before the seed round, Cadoo says it had raised $350,000 via an angel round from Tim Parsa’s Cloud Money Ventures Angel Syndicate, Wintech Ventures, and Daniel Gross’s Pioneer.

Of course gamification of health is nothing new — given the data-fuelled quantification and goal-based motivation that’s been going on around fitness for years, fuelled by wearables that make it trivially easy to track steps, distances, calories burned etc.

But injecting money into the mix adds another competitive layer that may be helpful for motivating a certain type of person to get or stay fit.

Cadoo isn’t the only fitness-focused startup to be taking this tack, either, though — with a number of apps that pay users to lose weight or otherwise be active (albeit, sometimes less directly by paying them in digital currency that can be exchanged for ‘rewards’). Others in the space include the likes of HealthyWage (a TC50 company we covered all the way back in 2009!); Runtopia and StepBet, to name a few.  

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The Robinhood competitor landscape intensifies as Invstr raises $20M

One of the biggest gripes about investing apps is that they are not acting responsibly by not educating users properly and allegedly letting them fend for themselves. This can result in people losing a lot of money, as evidenced by the number of lawsuits against Robinhood.

Today, an eight-year-old company that has been focused on nothing but financial education is now offering trading and banking services in the U.S..

Over the years, London-based Invstr has built out an educational platform with features such as an investing academy. It’s created a Fantasy Finance game, which gives users the ability to manage a virtual $1 million portfolio so they can learn more about the markets before risking their own money for real. Via social gamification, Invstr has set out to make the educational process fun.

It has also built a community around users so they can learn from each other (something another Robinhood competitor Gatsby is also doing).

Over 1 million users have downloaded the platform globally.

Invstr, according to CEO and founder Kerim Derhalli, is taking a different approach from competitors by offering education and learning tools upfront. And in addition to giving users the ability to make commission-free stock trades, it’s also giving them a way to digitally bank and invest using their Invstr+ accounts “without ever needing to move money from one place to another.”

Invstr takes it all a step further for subscribers who have access to an “Invstr Score,” performance stats and behavioral analytics among other things.

Derhalli said moving in this direction with the company was part of his business plan from day one.

“I think the most powerful trend in the U.S. is self-directed investing,” Derhalli told TechCrunch. “Younger generations have grown up in an app world and they expect to be autonomous and do things for themselves. Many distrust the banking system, and they don’t want to follow in their parents’ footsteps when it comes to banking and finance. We think this is a massive opportunity.”

In the unveiling of its new offerings, Invstr also announced Wednesday that it has closed on a $20 million Series A in the form of a convertible offering. This builds upon $20 million it previously raised across two seed rounds from investors such as Ventura Capital, Finberg, European angel investor Jari Ovaskainen and Rick Haythornthwaite, former global chairman of Mastercard.

Derhalli said he felt compelled to found Invstr after seeing firsthand how a lack of knowledge and confidence can prevent individuals from starting to invest. He worked for three decades in senior leadership roles at Deutsche Bank, Lehman Brothers, Merrill Lynch and JPMorgan before founding Invstr “so that anyone, anywhere could learn how to invest.”

Invstr is offering its new investing services in partnership with Apex Clearing, which formerly provided execution and settlement services to Robinhood. Its digital banking services are being offered through a partnership with Vast Bank. To address the security piece, Invstr said its user data is also protected by technology from Okta.

The company, which also has offices in New York and Istanbul, plans to use the new capital to launch new brokerage and analytics tools and a portfolio builder.


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Kaizo raises $3M for its AI-based tools to improve customer service support teams

CRM has for years been primarily a story of software to manage customer contacts, data to help agents do their jobs, and tools to manage incoming requests and outreach strategies. Now to add to that we’re starting to see a new theme: apps to help agents track how they work and to work better.

Today comes the latest startup in that category, a Dutch company called Kaizo, which uses AI and gamification to provide feedback on agents’ work, tips on what to do differently, and tools to set and work to goals — all of which can be used remotely, in the cloud. Today, it is announcing $3 million in a seed round of funding co-led by Gradient — Google’s AI venture fund — and French VC Partech. 

And along with the seed round, Kaizo (which rebranded last week from its former name, Ticketless) is announcing that Christoph Auer-Welsbach, a former partner at IBM Ventures, is joining the company as a co-founder, alongside founder Dominik Blattner. 

Although this is just a seed round, it’s coming after a period of strong growth for the company. Kaizo has already 500 companies including Truecaller, SimpleSurance, Miro, CreditRepairCloud, Justpark, Festicket and Nmbrs are using its software, covering “thousands” of customer support agents, which use a mixture of free and paid tools that integrate with established CRM software from the likes of Salesforce, Zendesk and more.

Customer service, and the idea of gamifying it to motivate employees, might feel like the last thing on people’s minds at the moment, but it is actually timely and relevant to our current state in responding to and living with the coronavirus.

People are spending much more time at home, and are turning to the internet and remote services to get what they need, and in many cases are finding that their best-laid plans are now in freefall. Both of these are driving a lot of traffic to sites and primarily customer support centers, which are getting overwhelmed with people reaching out for help.

And that’s before you consider how customer support teams might be impacted by coronavirus and the many mandates we’ve had to stay away from work, and the stresses they may be under.

“In our current social climate, customer support is an integral part of a company’s stability and growth that has embraced remote work to meet the demands of a globalized customer-base,” said Dominik Blattner, founder of Kaizo, in a statement. “With the rise of support teams utilizing a digital workplace, providing standards to measure an agent’s performance has never been more important. KPIs provide these standards, quantifying the success, achievement and contribution of each team member.”

On a more general level, Kaizo is also changing the conversation around how to improve one’s productivity. There has been a larger push for “quantified self” platforms, which has very much played out both in workplaces and in our personal lives, but a lot of services to track performance have focused on both managers and employees leaning in with a lot of input. That means if they don’t set aside the time to do that, the platforms never quite work the way they should.

This is where the AI element of Kaizo plays a key role, by taking on the need to proactively report into a system.

“This is how we’re distinct,” Auer-Welsbach said in an interview. “Normally KPIs are top-down. They are about people setting goals and then reporting they’ve done something. This is a bottom-up approach. We’re not trying to change employees’ behaviour. We plug into whatever environment they are using, and then our tool monitors. The employee doesn’t have to report or measure anything. We track clicks on the CRM, ticketing, and more, and we analyse all that.” He notes that Kaizo is looking at up to 50 datapoints in its analysis.

“We’re excited about Kaizo’s novel approach to applying AI to existing ticket data from platforms like Zendesk and Salesforce to optimize the customer support workflow,” said Darian Shirazi, General Partner at Gradient Ventures, in a statement. “Using machine learning, Kaizo understands which behaviors in customer service tickets lead to better outcomes for customers and then guides agents to replicate that using ongoing game mechanics. Customer support and service platforms today are failing to leverage data in the right way to make the life of agents easier and more effective. The demand Kaizo has seen since they launched on the Zendesk Marketplace shows agents have been waiting for such a solution for some time.”

Kaizo is not the only startup to have identified the area of building new services to improve the performance of customer support teams. Assembled earlier this month also raised $3.1 million led by Stripe for what it describes as the “operating system” for customer support.

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Salesforce expands Trailhead training as it envisions a world of citizen developers

Trailhead If every company is a software company, perhaps every line of business (LoB) employee should be a programmer. That would be appear to be the idea behind Salesforce’s massive TrailheaDX announcement today. Ultimately, Salesforce hopes these LoB employees will be able to build apps without the help of IT or trained programmers. While the technical folks with programming knowledge… Read More

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Hate the games, not the players

chess Imagine that you are lead strategist for the Hillary Clinton or Donald Trump campaign (take your pick). Your job is to maximize voter turnout in November. You hypothesize that more people would vote if doing so were fun. If your campaign could turn rallies and voting into a game, you’d drive more people to the polls, right? Not exactly. Read More

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Swarm Now Lets You Spend Those Coins On Upgraded Stickers

sushi Remember when Swarm launched coins? While the reward for checking in was entertaining, the coins had no real use other than providing a measurement by which to rank you on the weekly leaderboard. Today, however, that changes. With the latest Swarm update, folks can use their coins to pay for sticker upgrades. Upgraded stickers yield 2X the amount of coins when used in a check-in. That said,… Read More

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