Innovators’ Spotlight: Waspit Group Inc
With an evolved platform and new B2B focus, NYC firm is making a buzz in “engagement banking”.
By Adam Perrotta, Assistant Editor, Paybefore
When it comes to multichannel commerce and mobile financial services, there’s a wide gap between the seamless, integrated experience today’s users want and what’s being offered, according to New York City-based Waspit Group Inc. The company has set its sights on filling that gap with an “engagement banking” platform that brings money management and transfer, e-commerce, social media, daily deals and reviews into an integrated user experience accessible entirely from a mobile device.
Evolution to Revolution
Formed in the U.K. in 2010, Waspit started out as a basic mobile payments platform aimed at a general audience. The company soon found, however, that its service was drawing most of its interest from the youth segment—users in their teens and early 20s, including college students—and that these users had a particular set of demands and expectations.
Getting to Know
Marketplace Names: Waspit
Location: New York City
Open for business: 2011
Line of Business: Engagement banking—B2C and B2B
Secret Sauce: Waspit has created the first true user engagement platform that combines the financial and non-financial ecosystems. Predictive Commerce Engine uses proprietary algorithms to identify a user’s spending trends and then push relevant deals and offers to them.
Founder: Richard Steggall
Funding: $3.8 million
Ownership: Public Unlisted Company
Business Model: Direct to consumer (students), and now supporting small FIs by providing Waspit as a PaaS.
Business Philosophy: “Challenge the normal, think differently, and be great.”
“Over nine months, we took on over 32,000 users,” says Waspit founder and CEO Richard Steggall. “And one of the key things we learned was students want to manage their financial affairs from their Facebook accounts and be able to do more than simply make payments.”
With that knowledge in hand, Waspit took flight across the pond, relocating its headquarters to Manhattan, and shifting its focus to the U.S. market. The company began a promotional campaign on dozens of college campuses, while revamping its platform to link mobile commerce with other key aspects of what Steggall calls the “online ecosystem.” That ecosystem includes mobile banking, enabling users to send and receive money to friends and family and make in-store purchases using a prepaid card linked to their Waspit accounts. Waspit’s social features, meanwhile, include automatic check-ins via Foursquare, along with giving users the ability to read and write reviews of stores, restaurants and other venues that can be shared with friends.
The platform also enables users to find daily deals at nearby merchants—but in a much smarter way than simply bombarding users with dozens of deals, Stegall says. Waspit leverages data gleaned from past shopping and check-in behavior to tailor deals by merchant or merchant type. Such data-driven “predictive commerce,” Steggall tells Paybefore, enables Waspit to earn the bulk of its revenue from percentages merchants pay the company on transactions that come from those deals.
“Because we understand what a user is doing from search and payment history, we’re not only driving transactions, we’re also increasing our own revenue capabilities,” he notes. Waspit typically keeps a 12.5 percent to 20 percent cut of each purchase made through its daily deal system. This revenue stream, Steggall says, means the company also can rely less on interchange and user fees—two aspects of payments that have come under increasing regulatory scrutiny over the past several years.
The Platform’s the Thing
After launching its revamped service as a beta test in the fall of 2012 and adding The Bancorp as its issuer, Waspit combed feedback from its more than 5,000 U.S. beta users to continue to hone its platform. And what the company soon realized, Steggall says, is that the platform itself could be a very attractive model for other financial services providers looking to offer their own customers a way to integrate banking, commerce and social media. “What became apparent to us late last year is that the platform we had built was extremely valuable,” Steggall notes.“We’re now moving into a B2B model where we’re going to provide FIs with our platform as a service to enhance their user engagement.”
The company announced this new focus in late May, and while no deals have yet been struck, Steggall says the company wants to work with firms “that have a banking or payments relationship with users.” Providers who could benefit from Waspit’s platform include smaller financial institutions looking to compete against larger banks with more resources and larger customer bases—as well as daily deals companies and review sites who are interested in integrating payments functionality into their offerings—a complicated process that could be greatly simplified by turning to Waspit’s out-of-the-box platform, notes Steggall.
Furthermore, the behavioral data generated by the platform’s commerce and social facets is a key for companies to generate consumer engagement that’s efficient and produces results, while not being a burden on the user. “It’s not as simple as offering a payment card” for those looking to offer payments, Steggall says. “It’s about having the search and purchasing data capability to interact with a customer in an effective and non-invasive way. Our platform is really a user-interaction model.”