GigaOM » Zipmark

Zipmark takes aim at the monthly rent check

Ryan Kim — Fri, 07 Dec 2012 19:13:30 +0000

When Zipmark CEO and co-founder Jay Bhattacharya’s father came to the U.S. in 1974, he started paying his rent with paper checks. That’s still pretty much the case for most renters today, though if Bhattacharya has any say, those days may be numbered.

Zipmark, a New York payment company that builds off of the existing checking infrastructure, is now putting the pieces in place to allow renters and management companies to do away with paper. The company announced this week that it has signed a deal with property management software provider Integrated Business Systems, which will make Zipmark available as a payment choice for its customers, who control about 300,000 units in the Northeast.

Zipmark CEO and co-founder Jay Bhattacharya

For property management companies who opt in, they can include a QR code on their bills, that allow users to scan them with Zipmark’s iPhone app or web app. Renters connect their checking account one time and then get notices via their iPhone app about future rent invoices. Users can pay each bill as they come in from their app or the web or set up recurring payments and the property management company gets paid the next day. Zipmark can also build a simple payment website for property managers that allows them to offer Zipmark payments online.

The deal will go into effect early next year and follows up on a partnership last month with RentShare, a rental payment portal that now offers Zipmark as a payment option. The partnerships, which Bhattacharya said will be followed by even bigger deals next year, are making good on Zipmark’s promise as a way to modernize the old rent check payment system. He said Zipmark will reach millions of units in 2013.

“What we’ve done with real estate is take out the friction,” said Bhattacharya. “There’s no reason I should be paying rent the same way my father did.”

Zipmark still faces some challenges in killing the rent check. Property managers need to adopt it. And users have to decide to pay that way. But there are benefits for both. Property management companies can get paid almost immediately and know that the funds are good instead of the potential for bounced checks. And they can get started in about 15 minutes. They need to pay 1 percent per transaction for using Zipmark, but payments are capped at $5 per transaction.

Consumers can do away with the pesky process of sending off a stamped envelope each month. Some property managers have previously offered ways to pay online but often it comes with a big credit card fee. Renters can still control when they want to pay and with Zipmark’s mobile app, they can pay from anywhere.

“The Zipmark experience is great for the payer, and our customers receive guaranteed funds on the next business day,” Mike Mullin, IBS president in a statement.

Zipmark graduated from the New York FinTech Innovation Lab last year and first considered handling all kinds of payments, including P2P and retail payments, which would pit it against PayPal and others. But in the last year, it’s narrowed its focus to B2B payments and recurring and high value payments from consumers to businesses. That makes more sense and allows Zipmark to focus on areas where it can make a difference. The company raised $2 million a year ago from NYC Seed, High Peaks Venture Capital and the New York City Investment Fund.

As someone who still scribbles out a rent check each month and mails it, I’m hoping my landlord gets on board with Zipmark. This is one of the only reasons I still use my checkbook and it doesn’t make sense in a world that’s moving to digital payments. Regulations in many cities will keep people getting invoices in the mail, but there’s no excuse why payers should have to kill any more trees to pay the rent.

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Zipmark raises $2M for check-based payment system

Ryan Kim — Wed, 14 Dec 2011 02:16:18 +0000

Zipmark, a New York start-up I wrote about when it graduated from the FinTech Innovation Lab, has raised $2 million to build out an alternative payment system that enables mobile payments that ride on checking networks. The money was raised from Village Ventures and Contour Venture Partners with participation from NYC Seed, High Peaks Venture Capital and the New York City Investment Fund.

Zipmark leverages the existing check-processing infrastructure to create a payment system that is fast, simple and cheap for users. The startup charges 1 percent for each transaction and caps fees at $5 regardless of the total amount. It can receive payments from any bank, thrift or credit union checking account and can send payments to a the recipient’s bank account by the next day. For merchants who use Zipmark, it can be a low-cost alternative to credit and debit cards and can also reduce the risk of bounced checks.

Zipmark ran a pilot earlier this year and is planning a bigger rollout next year including an iPhone app launch in the first quarter. Users of the mobile app will be able to make payments for things like rent, fees or subscriptions by scanning QR codes from printed invoices.

“Our goal is to modernize the checkbook—to reduce the amount of time and money it takes to make a check payment, eliminate the possibility for bounced checks, and take all risk out of the equation for payer and payee alike,” said CEO and co-founder Jay Bhattacharya.

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FinTech startups wield data and smarts

Ryan Kim — Fri, 22 Jul 2011 19:25:22 +0000

New York, already home to an impressive number of financial technology startups, just welcomed a new batch of companies that are bringing some impressive ideas to bear on data, analytics and payments. The FinTech Innovation Lab, a collaboration between the New York City Investment Fund and Accenture with support from the New York banking community, just graduated its first class of six companies on Friday and showed them off to a group of investors.

I had a chance to hear their presentations, and it was a rock-solid group pulled from more than 90 applicants. The class showed that there is a lot of innovation happening in this field and that there is still room for new approaches in the financial sector. And the program showed that New York overall is honing its pitch to be a home for startups. Category-specific programs like this and NYC SeedStart’s media-focused summer class show that the city has some attractive accelerator options for entrepreneurs that address particular verticals. That may be the next step for accelerator programs, to focus on specific areas rather competing head-to-head as general startup programs.

Back to the new FinTech Innovation Lab class. I really enjoyed hearing from all the startups, but a few stood out to me.

Zipmark CEO Jay Bhattacharya

I liked Zipmark, a new mobile-payments service that is leveraging checking networks to enable fast, simple and cheap payments. By tapping the existing low-cost check-processing infrastructure, Zipmark is able to limit the cost of P2P payment fees to $1 for transactions of between $40 to $400 and makes it free for anything less than $40. Vendors using Zipmark pay fees of 1 percent, capped at $5 per transaction.

The system is not only cheaper than competing offerings such as PayPal but it also offers ease of use, especially for companies that are used to taking payments in checks. Real estate and property owners and other billers can include a QR code on their bills, allowing Zipmark users to scan and pay. The system basically connects to a user’s checking account, verifies and authenticates the payment and then sends a check to the recipient’s bank account by the next day. Zipmark doesn’t hold on to the funds or force people to carry a balance with them.

I like Zipmark because it taps existing accounts, similar to how Dwolla and eWise also connect payments to a user’s bank account. We’re hearing a lot about new approaches like near-field-communication payments, but for some payment situations, it makes sense to tap existing networks. Customers track their Zipmark payments and see a digital check receipt. Zipmark will need to find traction with billing services and commercial banks; right now, it has just one pilot under way.

CB Insights CEO Anand Sanwal

CB Insights, which already provides structured data on startups and private companies, is taking its service to the next level with Mosaic, a real-time insight and intelligence service that pulls in a wealth of data — unstructured, semi-structured and structured — to paint an overall picture of the health of a private company.

Mosaic integrates data from social media, job boards, press publications, government filings and other sources to create an index about how a company is doing. Some services give a limited look at specific signals, and some research firms look at a group of startups in particular areas. But Mosaic should be able to cover a wider array of private companies with at least 10 employees and provide a deeper assessment of their current state. It’s reminiscent of DueDil, a British company taking a similar approach to assessing companies with publicly available data.

This is helpful for firms doing business with a private company, to understand how reliable their partner might be. But it can also be useful for vendor selections, supply-chain decisions and secondary markets and should be attractive to investment bankers, private equity firms, venture capitalists and corporate M&A teams. The key is in ingesting a wide array of information, applying sentiment analysis to things like press mentions and then properly weighting the data to come up with a comprehensive picture.

“There’s no one smoking gun, but when you weave disparate signals together you can create a picture of a company’s health,” said Anand Sanwal, the CEO and co-founder of CB Insights.

Aqumin CEO Michael Zeitlin

The most visually arresting startup was Aqumin, a software company that lets traders, investment researchers and analysts use its 3-D visualization and analytics tool to create interactive “landscapes” out of mounds of data. More than just a visualization tool, Aqumin’s AlphaVision lets people get into the data, apply filters and algorithms to it and see how it responds in real time. Users can zoom around a set of data supplied by Bloomberg, for instance, and click on information to get more information.

By letting people visualize data and interact with it, Aqumin enables people to see patterns and trends much faster than if they used traditional spreadsheets or 2-D charts. CEO Michael Zeitlin said the tool takes advantage of our ability to naturally pick out patterns visually, something that is much harder to do when poring over spreadsheets. He said AlphaVision will be indispensable in ten years as financial workers try to grapple with a deluge of data. Zeitlin has had success before with data tools, building a geo-seismic software company called Magic Earth. The company offered a 3-D visualization product for the oil industry that was eventually bought by Halliburton for $100 million.

I’m not sure if everyone will be using AlphaVision, but I do think these types of tools will be more critical as people delve into more data. Visualizing information is important, but as we’ve said before, the big money is made in analyzing it. AlphaVision helps people do both in a way that’s fast and pretty easy to use.

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