Technology Entrepreneurship Venture Lab 2012 class project

1. Payment by Cellphone!
Because No One Likes to carry cash &
credit cards...

2. Who Likes Big, Bulky Wallets???
Our research using Survey
Monkey found that most people
like the idea of not having to
carry a wallet. Some however
are concerned about security....
What do we keep in our wallets: Credit/Debit and ID cards,
photos of loved ones, change, membership cards, change
All of this is quickly turning into the "digital wallet"
The digitally savvy (people with iphones and androids) are
ready to make the shift, if we can get over the security
concerns

3. Options already out there, Side by side of 4 existing companies
offering cellphone payment:
how do they compare? Google Wallet, Isis, Boku and Square

4. From our online research we found:
There are differences in what companies offer:
A. Payment Options. Either favor one credit card company over
another - making the consumer pick one based on their credit card
preference. Also, some only offer a paypal type card or do not offer
debit card use. Same goes for customer loyalty cards.
B. Phone Type. Some companies only serve iphones while others
offer both.
C. Transaction Costs. How the payment gets handled varies:
Some retailers pay direct to the credit card companies (often with a
4% fee), an intermediary like Square (2.7% fee), or directly to the
mobile phone companies.
The later option sets up the mobile phone industry to take over
credit card payments which would be a big shift in the industry.
Currently there are 2 billion credit card users, but more than 6 billion
mobile phone customers (via Boku).
D. Advertising. This can be built into the transaction/receipt and if
you have your phone on while shopping the retailer can wirelessly
transmit offers to the customer.

5. One of the Most interesting Differences
is how we are able to make Payments:
Tap the Phone
Swipe a Card
Pay with your
Phone Number

6. What is our Market Size in $$$:
200 million wireless subscribers
100 million phones sold each year
3-4 People in the U.S. are wireless users
20,000 retail outlets that accept mobile phone payment
Source: Isis
2 Billion credit card users world wide
6 Billion Mobile phone users world wide
Source: Boku

7. What we learned from customers:
Yes it's great not to carry your wallet for those
of us into tech....
The early adopters are people that already
own an iphone or android
What we learned from the competition:
It's not enough to have the consumer willing to make the shift
Businesses have to be willing to shift to the new infrastructure. And that
adoption needs to be cost neutral or even a cost advantage. Small Local
Businesses do not have large profit margins. Any mass-market solution
needs to fit into both large and small businesses' cost structure.
Square and Verifone are pursuing small business owners with offers of free
swipe accessories that allow for point of sale transactions (see above) without
a large infrastructure cost and a lower transaction rate.
Maybe we could pursue a different angle like....focusing on pre-payment the
way that Fandango does. That is not strictly a cellphone payment.

8. Cellphone Payment - Current Available Use:
Google Wallet: Online only
It's the future, we think that Isis: In Austin and Salt Lake
City at approx. 30 retailers ea.
Boku: Online currently
It's worth pursuing with a pivot Square: Retailers - amt.
Unknown

9. Cellphone Payment - Current Available Use:
Google Wallet: Online only
Beta Test Isis: In Austin and Salt Lake
City at approx. 30 retailers ea.
Partner with Restaurant.com - widely used
Boku: Online currently
and trusted by consumers. Square: Retailers - amt.
Unknown
Two limited test markets to validate concept -
Los Angeles and San Francisco.
Data gathered will be used to determine
usage information, work out bugs, get
feedback.