WHAT: Small businesses get discounts at over 60 vendors based on the number of purchases they make and those of their group -- friends on Facebook or an association/program partnering with Rewardli -- up to the max a retailer is willing to give. Group members do not need to buy the same thing at the same time to get the deal, and deals are always "on." Businesses make a purchase through the vendor's regular ecommerce site and receive their discounts as cash back in their PayPal accounts once a month.
Members can be part of more than one group. Those in a private group (e.g., alumni association, frequent flyer program) can get discounts not available to everyone on Rewardli.
Hardware discounts range from 1% to 3% and some web-based services are 30% to 50% off. Average discount right now is 10%. Vendors include Lenovo, FedEx Office, Priceline, GoDaddy, Staples, Skype and Sheraton.
Rewardli browser extension for Chrome alerts members when they are on a site that offers discounts -- click "yes" and continue purchase as usual to get cash back. Other browser extensions in development.
LAUNCHERS: George Favvas, CEO, founded Reflexity, a lead-gen company, and SmartHippo, which uses community input to make mortgage rates transparent. CTO Jean-Sebastien Boulanger co-founded a company that runs viral contests on Facebook.
[ J.S. (left) and George prepping for their launch at TC Disrupt. ]
WHY: The nation's 26M small business owners spend an average of $180K a year on services -- most of them don't get discounts on anything. Daily deal sites push deals rather than aggregate demand. Small businesses don't buy on impulse. Costco and Sam's Club don't offer SaaS and hotel discounts.
WHEN/WHERE: Sept. 13 / San Francisco.
BACKSTORY: George got a discount at the Apple store when he bought a few MacBooks and quickly realized small business owners didn't have the same access to deals as big companies. "It doesn't necessarily take a lot of purchases to get a better deal," says George.
Although the business sounds obvious, George says he spent a lot of time researching and was surprised no one had built it yet. He also studied successful social games, which showed him the value of two-sided benefits -- you and a friend win when you take an action -- and applied that concept to Rewardli.
BUSINESS MODEL: Percentage of each sale that goes through Rewardli. Also planning to sell white-label SaaS solution to affinity groups that already have discount programs.
Down the road, Rewardli will have a data product. Explains George, "We'll be able to do some very intelligent targeting, and we'll be able to give feedback and valuable data to vendors and group owners and group administrators."
HOW MUCH COMPANIES CAN SAVE: No average figure yet, but George says they're "trying to benchmark some of that now so we can come up with ways to extrapolate" the data. LinkedIn data will help [ see LinkedIn point ].
COMPETITION: Daily deal sites targeting small businesses like GroupPrice, Bizydeal and Boss Rocket. Cash-back or discount sites like Fatwallet and RetailMeNot. Retailers like Costco and Sam's Club.
ON COSTCO: "As we grow our user base, we'll get into specific niches that Costco or bigger big-box retailers wouldn't because they have to carry physical inventory," says George, who also notes, "I can't bring my social graph with me to Costco."
CUSTOMERS/GROWTH: 500 users in closed beta and since launching another 500 signups.
During beta $6K/month in transactions.
ON LINKEDIN INTEGRATION: Those signing up with LinkedIn give Rewardli valuable data about their location, industry and company size. "We can use that to base them in other groups and also target different types of deals," George says. The same info will help Rewardli estimate a company's savings.
ON THE BROWSER EXTENSION: "People who have the plugin installed make four to six times as much purchases as people who don't just because we catch so many things," says George. "Look at the vendor list. These are vendors almost everyone reading uses once or more in a 12-month period."
GOAL: "There's 26M SMBs in the U.S. spending $180K a year, that's $4T in spending. We want to be the conduit through which most of that flows," says George.
WHO BACKED IT: 500 Startups, Real Ventures, Initio Group, Kima Ventures, and angels.
TOTAL RAISED: $600K
NUMBER OF EMPLOYEES: 2 and hiring an engineer and UX designer.
Sign up with either your LinkedIn or Facebook account.
You're immediately prompted to invite friends from Facebook or email friends to increase your buying power. As the box on the right shows, your current buying power is only 20% at this point and will only you get a 7.2% cash reward at GoDaddy and 2.2% at hotels.com.
Now view the deals available. Rewardli shows you the popular list and the discounts you currently have, but you can also view deals by categories including accounting/HR, software and travel. The upper-right corner shows your cash back to date and your account balance. Note the link at the bottom that lets you request a deal if your favorite vendor is not part of Rewardli.
From the deals available, you can click on "details" to get to the page where you can get the deal. Rewardli shows you how much cash back you can get (in this case 7.2%) and the best deal you can get with more buying power (20%).
A purchase triggers an email (subject line: "You've got cash") that gives the dollar amount earned, how much greater the reward would be with a larger group and the chance to invite more friends.
Under the "transaction history" tab, review your transactions, which appear in reverse chronological order and show you the reward you earned for each.
1. "5 Things to Do Today to Get Discounts for Your Small Business" (Amex Open Forum, Sept. 10, 2010)
2. "Bizydeal offers daily small-business deals" (Chicago Sun-Times, March 21, 2011)
3. Rewardli presentation at TC Disrupt (Sept. 13, 2011)
CONTACTS & LINKS
Email: george at rewardli dot com
Email: js at rewardli dot com
Jobs: george at rewardli dot com