Yiftee, a gifting service that aims to drive business to local merchants, has raised $850,000 in seed funding from Scott Cook, Mohr Davidow Ventures, and other angel investors.
Similar to other gifting apps, Yiftee allows you to give gifts to friends via a mobile app. However, all gifts on the platform are from local businesses. For example, you could gift your friend a glass of wine, manicure, or lunch at a local merchant.
To send a gift, the consumer fires up the Yiftee iPhone app or website, chooses a friend and their location, and Yiftee will present gifts from featured merchants in that area first with pictures, descriptions, and pricing. Once the consumer chooses a gift, she writes a note, pays Yiftee for it, and sends the gift notification via Facebook, email, or text.
The gift recipient can then pay for the gift via a prepaid MasterCard credit card that he or she shows the merchant on a smart phone. Yiftee makes money by charging a convenience fee that is paid by the gift giver. Yiftee currently has 2 million local restaurants and shops listed.
The startup is the brainchild of Lori Laub and Donna Novitsky, who was previously the CEO of Big Tent, which was sold to Federated Media in 2010. She was also a partner at Mohr Davidow Ventures for nine years. As Novitsky explains to us, Yiftee provides an interesting alternative to local commerce by helping drive traffic into stores. The startup, of course, will face the challenge of providing customers who will become repeat visitors.