San Rafael startup captures 1,500 customers; growing by 500 a month
By Loralee Stevens, Special to the Business Journal
SAN RAFAEL — Three partners with backgrounds in electronic payments have launched a loyalty card platform they say will enable small-and-medium-sized businesses to thrive.
SpotOn is the brainchild of identical twins Zach and Matt Hyman and technology innovator Doron Friedman. The Hyman brothers have sold one transaction-services startup and currently operate a second, Central Payment of San Rafael.
Since beta-testing began in April of this year, the company has signed up about 1,500 subscribing retailers across the country, 200 in the Bay Area. According to its founders, the service is attracting 500 new customers each month.
“We saw a huge gap in the loyalty card market,” said co-CEO Zach Hyman. “Individual loyalty cards are expensive to provide and a nuisance to carry. What consumers need is one card for multiple businesses, or better yet, an app that allows them to swipe their smartphones for awards.”
And merchants want the ability to track revenues, analyze their customers’ wants and contact them through email and social media, he said.
The SpotOn solution is a Samsung tablet for business owners equipped with a complete loyalty system, including customer tracking, interfaces with Twitter and Facebook, analytics, tools for promotional campaigns and more.
Users earn spots by registering, checking in, telling their friends about businesses they like via social media or participating in events devised by the subscriber. They can redeem their spots for goods and services provided by local retailers.
“People seem to like the interaction,” said Kevin Hamilton, general manager of health club Body Kinetics in Novato. “We were using a CRM service to track our customers and give awards, but SpotOn involves the customer. After they check in using the tablet they can scroll down to check out the awards.”
After a slow start in April, the service caught on among club members, he said. Now 300 are using it.
According to Luciano Faria, owner of Rocco’s Pizza in Mill Valley, high school students especially like using the tablet.
“Any kind of technology — they love it. We also use a card that we stamp, but SpotOn tracks their purchases automatically. Every 10 swipes they get a free slice,” said Mr. Faria.
Merchant subscribers pay about $50 a month for the service, with small fees for running promotions.
Consumers can download an Android app to turn their smartphone into a loyalty card.
“We’re focusing on small to midsize retailers and service providers right now,” said Mr. Hyman. “Large chains will eventually be a focus as well, but first we want to develop a strong network among local merchants.”
SpotOn has put sales teams in selected metro areas, including Southern California, Austin, Atlanta, Miami and Chicago, where its technical team is located.
The company, funded with $5 million by the Hyman brothers, has 35 full time staffers, mostly in the San Rafael headquarters, and about 50 salespeople.
Mr. Hyman declined to give revenue projections. He said current funding will be sufficient to take the company to profitability, although he and his partners are open to investment.
For more information visit www.spoton.com.
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