PayNearMe, the cash payment network, today announced that it has closed a $16 million round of financing led by Khosla Ventures.
New investor August Capital and current investors True Ventures and Maveron also participated in the round. The company will use the funds to expand its network of retailer payment locations and payees, and to launch new service offerings, including its new mobile payment option, announced separately today.
PayNearMe also announced that payments veteran Mark Britto, CEO of BOKU and former BillMeLater board member, will join the company's board of directors.
"We look to work with great entrepreneurs in big markets undergoing disruptive change," said David Weiden, general partner of Khosla Ventures. "Danny has brought together a terrific team, and we are confident payment services with otherwise un-banked and under-banked consumers will change fundamentally over the next decade."
"We like to invest in companies that solve problems in large, underserved markets," said David Hornik, general partner of August Capital. "By combining the broad appeal of cash with PayNearMe's highly flexible technology platform, the company can serve consumers and payees in almost every industry, including ecommerce, lending and transportation."
"When I realized that PayNearMe could significantly improve consumers' financial lives by offering cash payment services that are better, faster and significantly less expensive than existing alternatives, I wanted to get involved," said Mark Britto, PayNearMe's newest board member. "Plus, I know from my experiences at BOKU, BillMeLater and FirstUSA how valuable a new payment network can be to merchants if, like PayNearMe, it allows them to unlock large segments of new demand."
"Every entrepreneur wants to work with board members and investors who share their passion for breaking the mold and building important businesses," said Danny Shader, CEO of PayNearMe. "With David, David and Mark's support, we will continue to build our suite of convenient, reliable, inexpensive and fraud-free offerings for consumersumers and payees across the United States."
Separately, PayNearMe, the cash payment network, today announced a mobile option for consumers who prefer to pay cash for e-commerce purchases, loan re-payments, e-wallet loads and a wide variety of other everyday transactions.
Using only their mobile phones and the new, free PayNearMe Card, consumers can complete transactions with a growing list of payees, including Amazon.com and Facebook.
PayNearMe Cards are available at more than 6,000 7-Eleven® stores across the U.S. In addition to the launch of PayNearMe Cards, the company also announced that it has secured $16 million in financing (see separate release for details) to continue delivering innovative service offerings, add payment locations, and expand its network of payees.
More than 50% of U.S. adults prefer cash for payment and a quarter of U.S. households lack credit or debit cards. This means American consumers need a secure and convenient way to complete remote transactions with cash. Because PayNearMe recognized that mobile phones represent a simple and easy way for these consumers to complete cash transactions, the company developed a mobile option based initially on the new, innovative PayNearMe card.
To complete a payment with a PayNearMe Card and a mobile phone, consumers:
1. Provide their mobile number to a business they wish to pay with cash
2. Get a free PayNearMe card from their local 7-Eleven store and reply to a text message from PayNearMe with the Card's unique number
3. Hand that PayNearMe Card and cash to a store associate who completes the transaction in real-time. After the transaction has been processed, the PayNearMe Card can be re-used or discarded.
As with all PayNearMe transactions, the payee is notified immediately that payment has been received with no risk of fraud, charge-backs or frozen funds.
Unlike gift or pre-paid cards, which store value and are typically in fixed amounts (or denominations), PayNearMe Cards simply enable mobile cash payments in any amount from $.01 to $1,000. There's no stored value, no hidden fees, no unused balances, and no need- or even ability -- to pay more than the consumer intended to spend.
"By creating mobile cash payments with the free PayNearMe Card, we're making it even easier for consumers to make payments with cash," said Danny Shader, CEO of PayNearMe. "Now, businesses that accept PayNearMe can serve the large and growing population of consumers who prefer cash and want to use their mobile phones."