Featured Pitch: Friendgiftr

By Rob Carpenter, Founder & CEO

E-commerce 2.0 is here, and Friendgiftr is proud to lead the way.  We are the first social media and mobile based company in the world to offer real, purchasable brand name company products—currently virtual and physical gift cards—to be bought through social networking sites like Facebook and mobile phones like the iPhone.  We have partnered with over 135 big names in the retail and restaurant businesses—players like GAP, Starbucks, Chili’s, Banana Republic, Sephora, Regal Cinemas and others—specifically with the intent of enabling consumers to shop from anywhere.  In other words, we have started to commercialize both the social media and mobile platform spaces for the first time in the U.S. but are also moving into other profoundly innovative areas so people can quickly and conveniently make purchases (most of this is still secret for now).

The idea behind this entire concept occurred in late 2008, as there was a realization that the then novel social media and mobile application platforms would become huge commercial playgrounds if you leveraged them properly.  In other words, there was an increasingly palpable feeling that a company could market and sell real brand name products to the existing users in these communities just like they had on eBay (as an aside, one of the brilliant parts of eBay’s business model, for example, has been that they have allowed smart companies to set up online retail storefronts on their website, adding great value for customers, businesses, and eBay itself).  When Facebook and Apple created their own application programming interfaces (APIs), it became clear that, just like on eBay, companies were willing to establish large footprints on these platforms.  But they were only doing so with virtual goods and virtual games.  And that is when Friendgiftr was born.  We realized that these companies were doing a great job at monetizing items like virtual smiley faces and cupcakes but that the market was much bigger for real products, which is the void we wanted to fill as the first company to offer real products through these APIs.

So in October 2008 I tossed the idea around with several friends and we began to do our startup homework on the who, what, when, where, how, and why of the company, our first targeted industry (gift cards), the available developer platforms, and everything else we needed to know.  The original Friendgiftr team was pretty diverse—we had several skilled programmers, a serial entrepreneur, and myself (somebody who had previously worked at the White House, as a business op-ed columnist, and as a social entrepreneur)—and worked pretty hard on the idea. But in the first few months all of the original team left even before any working prototype was produced, leaving me on my own (I surmise these members exited our project because of the very physically, mentally, and financially stressful nature of creating a never-before-tried company—or any company for that matter).  However, it has all worked out for the best and I wish the original team that helped me research the concept all the best.

Friendgiftr is now backed by Tech Coast Angels, has scaled to 22 employees, and is pursuing a business model with multiple viable revenue streams.  First, we get a percentage of every gift card sold through our various platforms.  Second, we receive slotting fees from merchants who are featured on our growing virtual commercial network—currently at six e-commerce storefronts and rapidly expanding to many more (most e-commerce companies only have one website or e-storefront from which to offer their products).  Third, we have a creative affiliate marketing program (and this phrase is used deliberately for lack of a better term, because we are turning this concept on its head and are not really pursuing traditional affiliate marketing).  And finally, we receive traditional ad-based revenue.  So in other words, Friendgiftr has built a business model with many sources of income, across many platforms, and with many partners not only because we want to diversify our risk profile, but more importantly because we want to maximize our potential reach and opportunities.

And the reach and opportunities for our company are endless.  While I cannot say too much more on our business model, strategic priorities, or where we are going next given the time-sensitive nature of our work—a lot of what we are working on are first-to-market projects—but I can say that we are obviously looking to grow our brand, expand our customer base, add new products and services, continuously improve, and, most importantly, add real value in this great financial ecosystem we call the private sector. We hope you will check us out when you get some time: www.friendgiftr.com.