Revolution Money Thinks It Can Win Friends On Facebook
Erick Schonfeld
45 comments »
Steve Case wants to make some new friends on Facebook. Today, his startup Revolution Money launched a friend-to-friend payment application on Facebook called MoneyExchange (as of this writing, it is still waiting to be added to the Facebook Application directory, but click on the link above and it should take you there if you are a Facebook member). Just like PayPal, which already has an app on Facebook, MoneyExchange lets you send money to your friends or receive money from them. Of course, if they want the money, they have to sign up for the application, and link it to their bank account. But that’s exactly how PayPal went viral. Revolution Money is betting that putting a payment service inside a social network will multiply that viral effect.
Sending and receiving funds on Money Exchange is free (as it is on PayPal for funds between two PayPal members). Dave Cautin, the senior vice president in charge of Revolution Money’s online business explains, “It is an opportunity to very easily collect money from your friends and associates. It could be used by housemates sharing the rent, or friends chipping in to buy a group gift.” Of course, there are many other apps that do this on Facebook already, including ChipIn, CashFly, and PayFriends, which are all based on PayPal. OboPay, which lets you text money to your friends from a mobile phone, also has a Facebook app. None of these are particularly popular, however. PayPal has 65 active daily users on Facebook. ChipIn has 81. CashFly and OboPay each have 3.
Revolution Money sees an opening here. “Massive online communities will have a currency,” predicts Cautin. And he wants Revolution money to be it. “For us, social networking is our laser focus,” he says. The company is also working on integrating the payment service into AIM, and offers it through its own Website.
In truth, Revolution Money sees MoneyExchange as a loss leader for its real business, which is the RevolutionCard, its credit card that undercuts Visa and Mastercard. It has no intention of making money off of MoneyExchange by charging for transactions because in its eyes the online payment service is just a way to build up a valuable network of potential credit card customers. You can be sure that every MoneyExchange member will get an offer for the RevolutionCard. Steve Case is just seeding the market.
Erick - good find. If you want to test out the app with me, send me a quick $5,000 and I will send it right back to you. Just use my name to find me in Facebook. Should be a good test to see the usability and so forth.
The money is on its way, Allen. Just keep hitting refresh.
Since when is sending money on PayPal free?
Looks like you can’t sign up for a new account unless you have a US address. That’s a shame. I think they should at least extend it to the UK (even for beta testing). The London network on Facebook is the biggest geographical network in the world, so a great potential test bed. I’d use it for all my events.
Great find!
There’s no way a facebook application is getting into my bank account.
Why do they expect this to take off if the stats for the other lending apps are so poor? Do they not make you link to your bank account?
I’m guessing the PayPal app probably does, if that’s how it went viral before being on Facebook. But I wonder.
Zach basic paypal is technically free. Granted it requires that all of your transactions get paid from people’s paypal account funds(w/o credit card etc)
too bad liberty dollar didn’t do a social network, maybe the fbi would’ve let them be
Get ready for next bubble burst, its coming…
Happy Holidays
Anything Steve Case touches turns to shit.
I can’t wait to receive RevolutionCard CDs in the mail
Ideas like this have always been successful in the past!
“Since when is sending money on PayPal free?”
PayPal charges recipients (just like credit card processors).
When does people think sharing private finance information online is getting safer now?
After $106B merger with Time Warner to 3 active users on Facebook? “Sic transit gloria mundi”
I find it odd that they chose to use the same logo as Revolution Health, another Steve Case company.
It confused me, at least, because I can’t see any clear correlation between the goals of the two companies. Certainly not enough to link them with the same mental recognition a logo creates.
BTW the Revolution Card sucks. 50m put into something that doesn’t appeal to the consumer. Oh…and Great name Steve. “Revolution” Come on now.
Steve Case wants to influence young kids to apply to get his RevolutionCard credit card. That is the catch.
If you go to the “revolutionmoney dot com/Docs/SummaryofCreditTerms.html” site, you can see that their Annual Percentage Rate (APR) 13.99%, 18.99%, 22.99%, 30.50%, 33.50%, or 35.50%.” are really high comparing to other credit cards.
Also, they have fees if you go over your limit and a transaction fee when you make a late payment:
” Late Payment Fee: $35.00
Over-Limit Fee: $35.00″
Wait, there’s more! In the fine prints at the bottom:
“* If you fail to pay your Minimum Payment by the Payment Due Date for two consecutive Billing Cycles, or for any four Billing Cycles in any 12-month period, we may increase your APR immediately to the applicable Default APR disclosed above.”
So every time your late, you pay $35 PLUS the APR.
If you do it twice, they will increase your APR. Thieves!
No xmas gifts for you, S”thief” Case!
Jared, I think Steve calls that branding. I would fire the marketing department on that one.
you have no idea how much trouble it is to use paypal in south africa. it sucks. i’ve been trying to make a $5 payment to someone on a forum, and it’s just so much trouble! i’ve contacted paypal, but apparently i have to wait for my unique user ID, which they can only help me with once the mad season is over. i don’t know what it’s like for the rest of the world outside of the states, but here it’s a mission.
This Facebook app has some real value for users (much like the other peer-to-peer money exchanges), unfortunately “value” is not the measuring stick used to gauge the success of these apps.
For widespread adoption on FB, they’ll have to take some notes from Slide and RockYou — hold the user’s hand through the app, add a very explicit viral component and incentivize users to invite their friends. How much is a true active user of the service worth to these guys? Their marketing guys should consider throwing some free money at users for the viral/incentive end of things to grow this service.
… and for some reason I’m seeing someone else’s friends list on the app??
“Of course, if they want the money, they have to sign up for the application, and link it to their bank account. But that’s exactly how PayPal went viral.”
Not true, PayPal went viral due to significant cash signup bonuses for sender and recipients. Also demand for the payment service was high because of a dire need for an easy auction settlement process (this market opportunity is now closed btw). Person-to-person payments was (and I’m guessing still is) a very small part of the online payment sphere.
Hackers !!! Write scripts to take all your friends money and put it in your account
Great! That’s all we need are kids getting ripped off on Facebook…I guess they did not learn anything from Beacon….Case refresh his account from AOL…..lol
Not bad actually, now TC send me some money!
You owe me !
WTF do people on facebook need to send money to each other for. When i was in college the defacto currencywas beer.
Finally, a clever start-up that’s not called Weebu or Moona or Janga or something stupid like that.
Ummm, who is Steve Case?
http://www.revolutionmoney.com....._team.aspx
Did you get the facts wrong on this?
*continuing Joe T’s comment* Instead it’s named Revolution! How clever! @#26 - Come now….not everyone is legal for beer….and some places crack down so hard on it, it’s hell :C
@28 Read:
revolutionmoney.com/PressUpdates/REV_PressKit_WashPost.pdf
@28, I believe Steve case employed this kind of money transfer software when he sold aol to Time Warner? Refresh “Revolution indeed”
I need another credit card offer in the mail… like I need another web 2.0 social network, or web 2.0 to do list, or another tech blog.
I can’t wait to sign up! Not!
>-)
PS- #18 “techcrunchreader”, you may want to note that the interest rates, terms/conditions, and fees are no different for competitor entry level cards from Capital One, WaMu, BofA, etc. in comparison.
@32 Brian
http://moneycentral.msn.com/ba.....itcard.asp
APR Range This Week Low: 6.5% High: 24.49% Avg: 13.69%
PayPal and a bunch of other money payments apps have all fallen flat on Facebook. And now Revolution Money, a clone of the others, comes along and is going to do well? Huh?
i met these guys for the first time at the web 2.0 summit. Although way wealthier than i am , i tried to point out some flaws in this revolution thing(to no avail). Leonis and Case have the insight, contacts , and money to do so much in the 2.0 space, but are missing a couple of key things. To date social networks have not proved to have even a blink of an interest in money exchange of any sort. I dont think you could get these kids (or adults acting like kids) on facebook to take out their credit card for mail order marijuana or buy one get one free ipods. Oddly enough, these same browsers have windows open at amazon , itunes, and specialty fish pond stores found through a google search in the toolbar above the profile page. They just dont do it through the socnet(ilike shows promise for others). One day it might all integrate in our minds and thus our user experience and trust, but by then it will be integrated into the sergey and larry icon in your brain at birth anyway.
The no fees feature will be attractive. PayPal tags you several ways if you use it for anything but personal use.
There are no friends on FaceBook!
Many do see Steve Case as bad business decision maker. He killed AOL Timewarner. Many executives don’t like his decision.
In the words of Time Warner shareholders “Steve was a bad Don”
Wow…with all the brain power you nerds supposedly have, you think you’d know a little more about what’s really going on here. Let me take you to remedial nursery school… do some research
a) the logo use is from the holding company Case and others own called Revolution, LLC. It’s used by all the corporate properties notably Revolution Health - which includes all the properties related to Revolution Health.com such as CarePages, Spark People, Health Talk, etc… I guess that’s what they’re now calling Revolution Health Networks but the press releases aren’t very clear. From the last press release, RevolutionHealth is now the number 2 most visited health site on the Internet behind WebMD. This is the part that sounds AOL-ish. Build your market through buying other companies and spreading the ad’s across all the properties.
b) Revolution owns other properties such as MiraVal, Zip/Flex Car, QLoud, Exclusive Resorts and other which you trolls should know are pretty finiancially successful (except for QLoud). So I guess not everything Case touches turns to S#@T, eh? He is also one of the largest land owners in HI and his pineapple company is also very finiancially succesful.
c) Revolution Card was a purchase by Revolution - the company was called GratisCard and was already being marketed. It’s the on line - PayPal portion that’s new. Revolution Card is primarily owned by Ted Leonisis…former vice chair of AOL/TWX and co-owner of the Washington Capitals, Washington Mystics and the Verizon Center through a company called Lincoln Holding, LLC. Case is a majority investor.
c) From the press I read, Case believes that Web 2.0 holds great promise if someone can figure out how to make money off it. Here’s where I see where he’s having trouble. And he’s far from alone. I don’t see ANYONE making money off of social applications.
Now you have accurate information to continue your trolling.
it’s US-specific. not interesting.
The company is new, but RevolutionCard already has some interesting deals…for example, you can get $20 off at Buy.com (and you can do this up to three times, so = $60). Pretty cool - and much better than Google Checkout’s one time $10 offer…
So what is it exactly that Revolution brings to the table with its Facebook application that the other existing, unpopular ones did not?
The alternative payments space is already very crowded. Their revenue model ‘if you built it (a solid user base) they (merchants) will come’ solves the problem that most alternative payment providers are struggling with: an active user base to create the demand from merchants. It will be interesting to watch 1) their loss leader approach to get a user base 2) whether merchants will pick it up as a payment option and 3) whether it will ever move beyond online payments and into the brick and mortar space.