Swipely: Integrating Payments with Customer Analytics

With the availability of huge amount of data around customer profiles and advent of Big Data tools, customer analytics has gained importance. To empower small businesses with customer analytics, startups are coming up with easy ways to integrate small business’s operation with advanced customer analytics tools. One such startup innovating in the area of payments and customer analytics is Swipely.

Swipely, a Rhode Island company, was founded in 2009 by Angus Davis. They received $1 Mn, Angel funding in 2009. In 2010 Swipely acquired $7.5 Mn through investors such as Index Ventures, Greylock Partners, First Round Capital, Charles Moldow, Emil Michael, Angus Davis etc. (total 11 investors). In series A funding. The company further received $7.5 Mn from Shasta Ventures, Reid Hoffman, Danny Rimer and Josh Kopelman in series B funding in May, 2013 bringing their total up to $20.5 Mn.

Swipely claims to be an easier way for local merchants to accept payments, understand customers and grow revenue with valuable analytics, loyalty and marketing tools. Swipely doesn’t install any new equipment. It integrates the existing POS at merchant site with internet to capture transactional data which is later used to give meaningful customer insights using analytics.

Swipely’s main idea is to make your everyday transactions social. But how we execute is completely different. The key idea behind Swipely is to add value to every swipe, What it means is that with every swipe of a credit card, Swipely wants to make that information more useful to both customer and the merchant. It’s not about how much customers are spending (Swipely doesn’t show that) but rather, where they are spending and what they are buying says Angus Davis, CEO of Swipely.

However, there may be a few limitations. As it does not capture point of sale data, Swipely does not know how much money was spent for a particular transaction which poses a limitations on its analytics and also poses problem in designing customer loyalty programs. A customer that buys a soft drink will receive as many reward points as a customer that buys an entire burger meal. The only information that a merchant has about a customer is when and how often the customer comes in. According to Forbes the annual number of transactions through Swipely have increased to $500 Mn from $250 Mn in 2012. According to TechCrunch, Swipely is growing at a rate of about 15 locations per month with $730 Mn in total transactions for 2013 which shows good growth.

Swipely’s payment model competes with Square, Blippy, Elavon, Mercury Payment Systems, Heartland Payment Systems, Global Payments.

LTP View: In comparison to its competition, Swipely has taken that extra step of integrating customer analytics and Big Data to provide value to small merchants. Swipely’s pricing may give it an edge over its largest competitor Square. As its pricing is 10 basis points less per swipe in comparison to that of Square..