Blackhawk Partners with Stockpile for U.S. Stock Investment Gift Cards (Oct. 14, 2015)
Blackhawk Network Inc. today announced a key partnership with the 5-year-old Palo Alto, Calif.-based startup Stockpile Inc., to distribute a line of gift cards representing U.S. stock market shares that can turn recipients into equity investors for as little as $50. Blackhawk sees the move as a significant step forward for financial inclusion that may “revolutionize” consumers’ access to stock market investing, said David Tate, Blackhawk senior vice president of products and marketing.
Available online and at participating retailers, the gift cards come in denominations of $25, $50 and $100 and are redeemable for fractional ownership of popular stocks or exchange traded funds like the S&P 500 or Nasdaq. For example, if a $50 gift card is applied to Disney Inc. when the company is trading at $100 per share, the recipient owns half a share in Disney stock. The first stores to carry Gift Cards for Stock are select locations of Safeway, Wegmans Food Markets, Giant Eagle and Kmart, the companies said.
Gift Cards for Stock enables consumers to purchase gift cards from Stockpile with a credit or debit card through Stockpile’s Website or the company’s mobile app. The company charges a 99-cent fee for each online stock purchase transaction and a $4.95 fee for cards sold at stores. Recipients peel off a sticker on the card to reveal a code, which they enter into Stockpile’s Website or the mobile app to activate the card. Recipients have the option to switch the initial gift card amount to a different stock at no charge, or opt out and convert the funds to a traditional gift card good for purchase for face value at a participating retailer.
Stockpile CEO Avi Lele is a former patent attorney and Dan Schatt, former general manager at PayPal, is Stockpile’s chief commercial officer. The company recently amassed a $15 million funding round from investors, which include Sequoia Capital. Stockpile says it devised Gift Cards for Stock to expand access to stock market investments to nontraditional investors and to simplify the process of giving stocks as gifts. The traditional approach to giving stocks usually requires opening a brokerage account with the recipient’s Social Security number, along with an initial minimum investment that usually exceeds $1,000. Stockpile says its service eliminates those hassles, and its all-digital business model provides cost advantages over traditional brokerage firms.