Announcing our investment in TrialPay

January 31, 2012 1 Comment

We are thrilled to announce our investment in TrialPay today, alongside T. Rowe Price, Visa, and DAG.

TrialPay’s CEO, Alex Rampell, is a world-class entrepreneur.  He’s been a software entrepreneur even before graduating from Harvard — and also an advisor, investor and board member at world class software companies.  We’re really excited to be working with Alex and the great team he’s built at TrialPay.

Alex has been a thought leader in online-to-offline commerce – he coined the phrase with this post in 2010  – and the evolving payments space.  We agree that there are massive opportunities for the consumer internet (including mobile and data) to transform offline commerce.  Retail is being revolutionized.  In terms we over-use in the valley, we are heading into retail 2.0.  Most importantly Alex has proven himself to be a world class operator building a substantial business at TrialPay.

TrialPay provides a transactional advertising platform.  This enables merchants to generate offers for consumers during the checkout process, for example, to get a better deal on a purchase they were in process of making.  While a seemingly simple idea, because it is executed well, it has the potential to markedly improve the experience for consumers, advertisers, and both online and offline merchants.  For consumers, they can receive significant discounts (and sometimes even free products) for things they were already going to purchase.  For example, as you are checking out at Fandango, you may receive an offer for a free ticket to the movie you are purchasing if you sign up for Netflix.  For global advertisers, they have the opportunity to acquire customers that have proven intent (going thru a check out process) and significant information about their interests.  For online and traditional retailers, with the addition of Visa to the platform, TrialPay can now help their merchant customers not only track online effectiveness, but can also see if they are driving traffic to stores.  It becomes an opportunity by which everyone wins: the consumer gets advantaged purchasing, the merchant makes a sale, and the advertiser engages a new customer.

TrialPay’s progress points to the power of its model.  Over 150 million online shoppers have been exposed to great offers since its launch in 2008.  Transaction volume increased 7x in 2011 while traffic to the platform increased 4x.  TrialPay’s platform now reaches over 70 million monthly active users.  Online and offline global advertisers believe in the vision, as TrialPay counts facebook, the Gap, Fandango, and Trend Micro among its customers.

TrialPay’s transactional advertising platform boosts revenue and converts more customers for online merchants by placing targeted promotions around transactions.  We anticipate seeing a significant new payment category through transactional advertising.

Congratulations to the team and we look forward to working with them as they pursue their very compelling vision.

Reid

Reid Hoffman

Filed under Security

Cardspring Launches Payment Network Platform

January 31, 2012 5 Comments

We’re pleased to announce our investment in CardSpring today, alongside our friends at Accel. We originally invested with Accel and several others in CardSpring’s seed round out of our Discovery Fund last year, so we’ve had the opportunity to partner with the team and see them in action. CEO Eckart Walther and the core team have great experience building scalable platforms at companies like Google, Demandtec, Tellme and Netscape, and we think they have the potential to build another significant company with CardSpring.

We’re big believers at Greylock in the “online-to-offline commerce” opportunity. Consumers often research online and then actually transact offline. While online commerce is significant at almost $200 billion annually, the offline commerce market is still over 10x larger (ie trillions of dollars). We’ve invested in a number of promising companies who are innovating in different facets of online-to-offline commerce including Groupon, Coupons.com, Shopkick, Wrapp, Swipely, TrialPay, and now CardSpring.

CardSpring’s vision is big and exciting. Their technology is super-charging the payment network, by bringing it into the cloud. For developers, CardSpring built a Payment Network Platform that lets them create a wide variety of new apps for credit cards and debit cards. CardSpring isn’t building apps. They’re connecting into the payment network and creating a smart layer to make app development for credit cards simple and secure.

For consumers, CardSpring’s technology will enable you to add apps to your credit cards, in the same way that you add apps to your iPhone today.  So you can click on an offer that you see in an online ad (15 bucks off your next oil change) to add the offer to your credit card. You can easily add a loyalty card (ie Starbucks), gift card (ie Best Buy) or a coupon (ie Groupon) to your credit card, and then the next time you’re in a store and pay with your credit card, you’ll automatically receive the benefit. You could also opt-in to receive a text message reminder based on your credit card purchase to check in, write a review, or receive a digital receipt.

For online publishers and marketers, CardSpring is a vehicle for closing the redemption loop. So a marketer can tie the performance of an online ad campaign directly to the resulting offline transactions. It’s like Google AdWords for online-to-offline commerce, where performance is measured in actual transactions instead of click-throughs.

Congrats to CardSpring on the launch of your Payment Network Platform! We’re excited to be working with you.

James, Reid, and Ali

James Slavet

 

 

Reid Hoffman

 

 

Ali Rosenthal

Filed under Security

Wrapp: The Future of Social Gifting

January 18, 2012 1 Comment

We are really excited to announce today our investment in Wrapp.

The recent explosion of both social and mobile platforms offer an unprecedented opportunity for new companies to revolutionize huge markets for hundreds of millions of people globally. Wrapp brings these social network and mobile platforms together to transform the gift card industry and the social expression of gift cards.

Wrapp has the potential to transform the consumer experience of gifting.  Now, your Facebook wall can be more than a set of text messages; it can be how your friends collaborate on gifts.  Moreover, since sending a gift is as easy as sending a message, we may see a new form of sharing culture grow on the web. Wrapp makes it not only trivial to know when someone you know receives a gift, but also gives you the ability to let them know you care by adding something yourself.

Wrapp also has the potential to transform dynamics for the retail merchants.  Merchants can use gift cards to attract ideally targeted customers into their shops.  They can leverage social networks to identify and socially reward customers to come shop in the real world.  Customer acquisition is 100% performance based and potentially collaborative with the customer’s friends.  Unlike the daily deal space, there is no overhang of liability for providing specific goods and services to pre-sold customers.

When Reid & I met Hjalmar and Andreas on our recent trip to the UK, we were immediately excited about their passion for reinventing the way that we give gifts to our friends and colleagues. Hjalmar and Andreas are both experienced consumer internet entrepreneurs bringing their online expertise to transform the experience and massive market of gifting.

The early results point to the power of the model.  Wrapp launched in Sweden late last year, and was used to send over 250,000 gift cards in December alone.  After just three months in operation, over 90% of all Swedes are targetable by Wrapp campaigns, one percent are already active with the Wrapp mobile application, and Wrapp users are sending approximately two gift cards per week.

We’re extremely excited to help Wrapp bring their innovations to the US market, where gift cards are an over $100B market annually.  Reid Hoffman will be joining Niklas Zennström on the Wrapp board of directors.

Adam and Reid

Adam Nash is an entrepreneurial executive with a passion for product and deep experience with mobile and social platforms.  He joined Greylock Partners in 2011 as an Executive in Residence, where he advises the leadership teams of the firm’s existing consumer technology companies as well as evaluating new investment opportunities. His complete profile can be found here.

Reid Hoffman is Co-Founder and Chairman at LinkedIn and a partner at Greylock Partners. He is a member of the founding team at PayPal and has been an angel investor and adviser to dozens of organizations including Facebook, Zynga, Flickr and Last.FM. Reid is a board observer at Airbnb and Swipely, an advisor to Groupon and a director at Zynga, Mozilla Corp., Shopkick, and Kiva.org. His complete profile can be found here.

Filed under Security

6 Insider Secrets to Partnering with Executive Recruiters

January 10, 2012 2 Comments

By Jeff Markowitz, Talent Partner at Greylock Partners

The right people are often the difference between success and failure in building companies. For startups, this is doubly true when it comes to executive hires. While co-founders and other early employees might find each other organically, this is rarely the case for executive talent.

For many entrepreneurs, this is the moment of introduction to the unfamiliar world of executive recruitment. Before joining Greylock to help manage executive talent within our network, I spent 14 years in the executive recruitment business. I hope to share a little of what I learned during my career to help entrepreneurs navigate this world.

In coming months, I’ll dive into some of the details of the recruiting process and share some of my favorite stories. Consider this post the Cliff Notes version of what’s to come, covering some, but definitely not all, of the elements of a successful search process.

1)  Think partnership, not outsourcing.

One of the most common mistakes entrepreneurs make is to think that once they’ve hired a search firm, the hard part is over. Unfortunately, executive recruiting is not something that can be outsourced like you might your payroll functions. Instead, you need to be actively involved and plan for it to take a meaningful amount of your time.

Sadly, as with marriages, not all hires work out. The more time you spend on your search, the more likely it is that yours will be one of the successful ones. In fact, I’ve turned down potential clients if it was clear that they didn’t intend to be an intimate part of the process, but were just looking for me to source great people.

2)  Fast-forward two years.

Before you even talk to a recruiter, you need to clearly define the sort of executive you are looking for. Jump forward a year or two, and articulate what a successful hire ought to have accomplished in that time.  Use this to put together a draft version of a position profile.

Early in your search, take the time to see what “Best in Class” looks like. While everyone thinks they can immediately spot first-rate talent, until you see a few in the flesh, you’re operating in the dark. Whether through your investors or your recruiter, meet with someone who is widely considered among the very best in the field. These early, potentially “ungettable” candidates help you calibrate your ideal profile for the job.  Remember, these individuals are not necessarily the bar.  You have to keep in mind your company’s stage and what you want this person to accomplish over the next few years. You’re trying to mitigate the risk of passing on the right person because you didn’t know what to look for.

3)  Don’t plan for lucky; it takes a while.

The day your A Round funding is announced, you’ll probably be swamped with calls from recruiters who want to help you with hiring immediately. Unfortunately, the very best recruiters are typically already engaged in searches and, on average, take 3-4 weeks to free up for a new search unless you get lucky and catch them at the right time. A talented, busy recruiter will typically be running somewhere between three and five concurrent searches.

Once the recruiter you’ve chosen becomes available, expect the process to take between three and six months. This might seem like a lot of time. But when you consider the years you will spend with your hire, and how harmful a bad fit can be, you’ll understand why it’s almost always time well spent.  It is possible to get lucky and have the search take less time, but don’t plan on it.

4)  Find the right person and process.

Every search firm can show you a fancy list of companies and executives they’ve worked with. But you need to know much more. You’re looking for a recruiter who you feel confident in as a representative of your company and who lays out a search process that you feel comfortable with. Ask yourself whether you will want to spend the hours on the phone with them on update calls, or how you’d feel if you were the candidate and they were selling you on the company and position. Do you feel good about the knowledge they demonstrate of what a successful search looks like, and how they walked you through their process?

5)  Listen for the why and the objections.

During your weekly status meetings with the recruiter, remember that you’re paying your search firm not just to come up with a list of names, but to also have a strongly informed opinion. Which candidates do they think are the strongest and best fit? And, of course, why? This will also help them fine-tune the future candidates they recommend.

Push for an added layer of data as well. Ask which candidates turned them down, and the reasons they said no. Understanding objections and preconceptions is very helpful in how you approach future candidates.  Also, you may learn when a candidate turns down a role for business reasons you feel you can overcome, ask the recruiter to arrange a call for you and the candidate to discuss.

6)  Listen for real references.

Once you’ve got a few candidates who you really like, you’ll want to begin checking references. While this can be a notoriously tricky process, there are tips that can help. A key thing to look for is balance.  You want to ask and look for critical comments about the candidate.  This evidences that the reference is being candid and not acting purely as a cheerleader. You’re looking for as rich a portrait of your candidates as you can get, and you need balanced references to achieve this.

As you can see, executive searches are complex beasts.  Like with everything else, the right preparation, focus and execution can yield terrific results. In future posts, I’ll elaborate on each of these, as well as discussing how to handle the offer process (when and how to give an offer), closing the candidate (much more art than science), and effectively on-boarding the candidate to ensure a smooth transition. Happy recruiting!

Jeff Markowitz is the Talent Partner at Greylock Partners

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