App developer shopkick gets $15M in funding
Mobile retail application developer shopkick Inc. has raised $15 million in Series B financing led by Greylock Partners, a sign that the mobile medium is becoming more of a priority for retailers.
Reid Hoffman, cofounder and executive chairman at LinkedIn and investor in Facebook and Zynga, has taken his first full board seat in any investment as a Greylock Partner. Kleiner Perkins Caufield & Byers, Citi Growth Ventures & Innovation Group and Silicon Valley angel investor SV Angel, led by Ron Conway, also participated in the round, which comes one year after shopkick launched the company and closed its $5 million Series A funding from KPCB’s iFund and Mr. Hoffman.
“The funding will be put in the bank and we have no plans of increasing our burn rate simply because we have more money,” said Cyriac Roeding, cofounder/CEO of shopkick, Palo Alto, CA. “We want time to continue to build a great product, build our brand and build retail relationships.
“If we find great people we may grow faster, but we have a great team already—incredibly good, some of the best people I’ve ever worked with actually,” he said. “We won’t explode just because we have money now.
“Our platform is based on what consumers want to do with their phones when they’re out shopping.”
Shopkick launched its mobile application CauseWorld in the United States in December 2009, in partnership with Citi, Kraft Foods and Procter & Gamble.
The company is planning to release its shopkick retail application for iPhone, iPod touch and Android before the end of the year, with Best Buy and Macy’s as the first two retailers to jump on board.
Shopkick till you drop
Location-based applications at the intersection of physical retail stores and smartphones are the next big opportunity in mobile, according to Mr. Hoffman.
Shopkick’s goal is to turn offline stores into interactive worlds, offering retailers and brands a marketing vehicle that is performance- and location-based.
Mr. Roeding said that the new funding allows shopkick to focus 100 percent of its resources on building its product, expanding its partnerships with retailers and brands and help to improve shopping for consumers in the physical retail world.
Shopkick will use the funding to further enhance its location-based shopping capabilities and accelerate partnership development in time for the release of its mobile retail application, shopkick, due for release this summer.
Shopkick has signed partnerships with retailers and brands such as Best Buy, Macy’s, Citi, Procter & Gamble and Kraft Foods.
Mr. Roeding said that shopkick’s first mobile application, CauseWorld, helped prove the utility of location-based mobile technology in the shopping world.
Since its December 2009 launch, shopkick claims that CauseWorld has been one of the fastest-growing and largest mobile retail applications in both the iPhone App Store and Google Android Market, downloaded more than 550,000 times in five months.
The four sponsors have donated more than $1 million to various charities so far.
“CauseWorld is the fastest growing location-based retail app in the entire App Store—why?” Mr. Roeding said. “Each check-in means something—every check-in is changing the world.
“How would you feel if you walk out of a McDonald’s and you’ve already fed a family in the U.S. or helped an earthquake victim in Haiti, made possible by Citi, or helped plant a tree in the rainforest, made possible by Kraft Foods,” he said.
“It turns marketing dollars into charity money directly—users earn karma points by checking in that turn into actually charity contributions to the charity of their choice.”
The company will take the lessons learned from CauseWorld and apply them to its new application.
“It’s one big national experiment to learn about shopping behavior and mobile, and we’ve taken that information and we’re now going to insert it into the shopkick app that is coming soon,” Mr. Roeding said.
“The shopkick app is going to be an app that is going to dramatically improve your shopping experience in the physical retail world—it’s very consumer focused,” he said.