Have you cleaned out your wallet lately? As our social lives continue to defrost from months of pandemic-induced hibernation, it may be a good idea to take stock of your credit cards and loyalty cards. And chances are you have a lot of them. The average American has 14 loyalty program subscriptions. It’s a big business – brands around the world spend an estimated $75 billion on customer loyalty management each year.
There’s one up-and-coming Boca Raton and Palo Alto-based startup that’s getting in on the points game, and helping consumers in the process. And they’re using blockchain to do it (it’s South Florida, of course).
Meet PointsKash. Users sign up and in a few clicks are able to consolidate all their points from various loyalty programs into one central account. Consumers can then convert these points into cash to use at their favorite stores.
PointsKash has an equally beneficial value proposition for the companies that offer loyalty programs. Partnering with PointsKash means that they can remove the points from their balance sheets, which is increasingly important because, according to the PointsKash team, consumers have stockpiled points during the pandemic. Working with PointsKash also gives companies an additional revenue stream because they get a share of the 3% fee that consumers are charged to redeem their rewards points.
But perhaps the most innovative aspect of PointsKash is its use of blockchain technology. PointsKash CEO Steve Janjic, a Wall Street veteran, explained that the startup leverages the Algorand blockchain for its payment system.
“We feel that with this application, we truly get to change the way that the entire rewards point and loyalty system works globally,” Janjic told Refresh Miami. “And we want to be the leader of that pack.”
PointsKash holds its assets in a stablecoin pegged to the US dollar. Then, when a user wants to redeem their points, the startup’s platform automatically converts the crypto into the fiat required to make the purchase.
Janjic highlighted a few advantages to this use of blockchain technology. “It really offers security that none of these individual platforms have ever had the ability to offer,” he explained, since users’ points are safely stored on the blockchain. Janjic also noted cost savings as another plus: “Blockchain cuts down the cost [of maintaining loyalty programs] from a third to a half – big numbers when it comes to ROI.” Additionally, the scalability of the blockchain-based platform is a key advantage: “it’s an infrastructure that’s able to scale globally.”
Despite these advantages, Janjic said that it can be an uphill battle to convince traditional companies to get behind blockchain. But when he explains that all it takes is to plug into PointsKash’s API, he’s often able to change their minds.
“We feel like the only way for them to succeed in the loyalty and reward space is to go on the blockchain, and we’re going to introduce that to them,” he said. “It’s never easy, but there’s always somebody that’s able to break through the door.”
PointsKash recently announced a $1.25 million seed round led by fintech-focused Seabury Global Markets. Janjic reports that this funding will enable them to launch early next year. However, Janjic already has his sights set on the next round of funding: a Series A round targeting $25-40 million. The startup, which was founded a year ago, currently has 15 full-time employees across its offices in Boca Raton and Palo Alto.
Stay on top of the latest from PointsKash by visiting PointsKash.com.
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