Button Raises $2.5 Million to Create Loyalty Program, Cross-App SDK
Two Venmo veterans are launching their own loyalty app. Mike Dudas and Chris Maddern, both former employees of Venmo/Braintree/PayPal, have teamed up to start an app that will add functionality to on-demand apps such as Uber.
With on-demand services like Uber, Seamless, and Hailo growing in popularity, adding services and benefits to these services is becoming more important as well. A new New York-based startup, Button, aims to do just that — add even more value to on-demand apps by creating loyalty programs and increasing inter-app operability.
While on-demand apps already have loyal users, Button asserts that it can improve customer retention through positive loyalty programs that “aren’t as interruptive as push notifications,” Chief Revenue Officer and cofounder Mike Dudas told Bank Innovation. The loyalty program will focus on rewards for users, creating a VIP or Gold status for frequent users, and offering them perks based on location or time.
Button announced today that it raised $2.25 million in funding from a number of investors, led by Atlas Ventures, including DCM, Greycroft Partners, Mesa+ Capital, and VaynerRSE and angel investors like Tim Kendall. Dudas said that Button looked for angel investors with relevant experience in Button’s product and vision — loyalty programs, monetization, e-commerce, etc. — and institutional investors that were located nearby, like Atlas Ventures, and could give Button guidance (though these weren’t hard guideline, Dudas notes).Button looks to use the investment to expand its team to 8 to 10 people — with many of them focused on engineering — continue to build its platform, and develop the first dozen (but hopefully more) partnerships, according to Dudas. Chris Maddern, another cofounder of Button and ex-mobile head of Venmo, added that Button did have some partnerships, but Button isn’t ready to announce them.
Maddern spoke about iOS 8 and the new extensions feature that will allow apps to communicate with each other easily, which wasn’t possible in previous iterations of iOS due to the “closed” nature of the updates. Button plans to develop an SDK so that apps can easily integrate, Maddern told Bank Innovation. “Extension gives us an ability to embed in app in a way we’ve never been able to do. App developers never want to take a user out of your app. With extensions, we can do collaborative cross-app interactions without leaving app. Also, companies can realize the value that’s added from other places. It’s a win-win.”
It looks like we could be seeing the first product from Button as soon as the end of this month.
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