Payfone bags $11M for expansion in mobile payments
Payfone Inc. has closed an $11 million round of Series B financing, which is one of the biggest investments in the mobile payments space to date.
Opus Capital and BlackBerry Partners Fund joined founding Series A investor RRE Ventures in this latest round of funding. Bob Borchers of Opus Capital and Kevin Talbot of BlackBerry Partners Fund will join Payfone’s Board of Directors in connection with this financing.
“Mainly we really think that this is a global opportunity—if you’re a major brand you can reach a global audience,” said Rodger Desai, CEO of Payfone, New York. “You want as much reach conversion and yield as you can as a business, and Payfone lets you get that global reach and conversion.
“We offer an opportunity for someone to put a shingle up and sell globally,” he said. “We want to open up offices in markets worldwide as a way to work with global brands.
“Clients want to know how best to market their services and operators want to know how to let consumers that this is available to drive revenue, transactions and conversions—click to buy and it shows up on your mobile bill.”
Payfone powers mobile billing for application stores and digital content storefronts, with a Merchant Hub that includes 300,000-plus merchants.
Beyond SMS to carrier billing
Payfone has built a mobile payments platform that leverages the capabilities of existing inter-carrier networks.
Designed from the backbone of the carrier network, Payfone uses signaling and global carrier standards to deliver mobile payment and billing capabilities.
Using these standards, Payfone connects application stores and content brands to carriers via existing network infrastructure.
Payfone claims that it enables online merchants, mobile application stores and brands to extend their reach, conversion and yield worldwide.
The consumer pays by providing a phone number for purchases that are then billed directly to the consumer’s prepaid or post-paid mobile account.
Payfone’s platform does not rely on premium SMS, fixed price points or complicated bill presentment.
Instead, it enables one-click mobile billing for online and mobile purchases worldwide with fraud prevention and detailed billing records.
The company plans to use the funds to scale its presence across Europe, the Middle East, Africa, Latin America and Asia.
“Many people in the world have phones buy only have access to a few card products, and for many people their most important financial relationship is with their phone,” Mr. Desai said. “Our platform has the reach and intimacy that mobile provides, as well as operator integration.
“The global ability to micro-bill is an amazing contribution to the Web, and there are different kinds of models that take advantage of that,” he said. “It starts with virtual and digital goods but this is just the beginning—media is the first thing you can consume, but many business models will be built on this.
“Operators trade $100 billion a year with each other for things like roaming, and a lot of commerce that they do is being extended to merchants because of us.”
Dan Butcher, associate editor, Mobile Commerce Daily