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☕️ The genius of Starbucks payment app


This week in fintech

September 7 · Issue #26 · View online

A weekly summary of the latest news in our world of finance, design, and technology.

🗺 Vipps going international
The largest Norwegian Fintech news this week is, without a doubt, that Vipps is partnering with Visa. This is supposedly the first step for Vipps to be able to offer its payment service as a white label to European banks. Christoffer Hernæs, former CDO in Sbanken,has a more nuanced view of the matter.. He says it is difficult to see that a wallet app from a bank has the opportunity to survive considering there are almost 200 different wallets already in the market. He elaborates that Vipps is now split between many different business models and investments within the same company. Vipps now consists of:
  1. The peer-to-peer payment platform that everyone thinks of as Vipps
  2. BankID - the Norwegian national identity solution
  3. bankAxept - the national payment infrastructure
  4. And now they are also trying to position themselves as an international software-company
Selling a mobile wallet in Europe will be an uphill battle for Vipps when their main competitors are Apple and Google, which create the devices users are paying with. Lucas Weldeghebriel, a journalist in Shifter, joins in with seven challenges Vipps will meet in Europe. He compares this deal with the deal Vipps made two years ago with AliPay, resulting in nothing. Lucas concludes that solving problems for overzealous Norwegian domain buyers is not the same as solving large European banks’ problems.
Another competitor in this field is Curve, the all cards in one app-solution. They also have a superior payment experience leveraging the payment solution you prefer, whether it be cards, Apple pay, or Google Pay. Last week they even added support for loyalty cards, completely erasing the need for carrying a physical wallet.
📈 Swipe card - get stocks
Speaking of loyalty cards: One of the most exciting reward-cards we’ve seen so far is Stash’s Stock-Back® rewards program. Users who pay with their Stash card at a given merchant receive fractional shares of that merchant’s stock as a reward for spending. This is taking the term that «voting with your money» to another level: The places you spend money on become the companies you’re an investor in. Rewards like this might also help more people into the stock-market. Read more about Stash Stock-Back rewards
☕️ The genius of Starbucks payment app
While we’re still in the payment-sphere: Starbucks has, by investing in their mobile payment app, turned the company into a quasi-bank. They have ~$1.6 billion in stored value card liabilities outstanding from physical gift cards and the Starbucks mobile app’s balances. All that money is basically a free loan from loyal customers to Starbucks! Few companies can get that much free financing. But it gets even better - some of this money will never get redeemed - called breakage. In 2018 Starbucks recorded a breakage of $155 million,~10% of all card balances. Starbucks, this way, loan money from consumers at around -10% interest rate. Read more about Starbucks monetary superpower.
🏀 Ever wanted to own an NBA-highlight? Now you can!
Dapper Labs, the blockchain company behind Cryptokittes (remember them from the height of the 2017 Bitcoin mania?), has partnered with the NBA to make digital collectibles of in-game highlights a reality. We’ve all heard of expensive collectible sport-cards. But Dapper Labs CEO, Roham Gharegozlou, believes digital sports collectibles are the next frontier. Together with the NBA, they will sell “card packs” starting at 9$ containing a different set of highlights that you can trade on their platform. Only one of each highlight is released, creating scarcity. NBA Top Shot is built on a proprietary blockchain called Flow. This was created because existing blockchains (including Ethereum) are geared towards transactions rather than providing functionality for games, apps, and digital assets. Well, it sounds more promising to collect a video than digital kittens. 🤔 Read more about NBA Top Shot.
By the way: Cryptokitties aren’t dead. The English rock band Muse is teaming up with Dapper Labs and releasing a limited edition Kitty “signed” by the band. This follows the partnership Dapper Labs signed with Warner Music Group one year ago.
On a related note: Andreessen Horowitz, a large investor in Dapper Labs and their Flow Blockchain, has started a crypto startup school. A lot of the course videos are available at their website.
👨‍🚀 World's First Mixed Reality VR / AR Banking Design Concept?
World's First Mixed Reality VR / AR Banking Design Concept by UXDA
Our User Experience find of the week is from UXDA, which claims that they have made the first VR/AR banking design concept. And although they have a few interesting visuals and ideas, I can’t see what differentiates this AR / VR from a touch-screen design other than the video-backgrounds they have added. And how do you interact with it? But who can blame them? As they say: «The only way to be ready for the revolutionary switch to VR / AR digital reality is to start generating ideas and concepts today.» 
Btw: if you want to look more into concepts outside traditional finance, our team of fintech experts has a diverse background ranging from developing IoT solutions to creating VR-companies (not even kidding!). We’re happy to help with creating concepts, working prototypes as well as final solutions.
🙏 Don’t keep it a secret!
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Marius Hauken, partner Stacc X
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