Some more consolidation afoot in the worlds of mobile marketing and mobile payments: Payvia, one of the many startups working in the area of carrier-based mobile billing, is buying Mogreet, a mobile marketing company that delivers campaigns via text, video and picture messaging services. Terms of the deal were not disclosed — although we have contacted the company to ask. Payvia says that the whole of the Mogreet team will be coming over, including Mogreet founder and CEO James Citron, who will become Payvia’s Chief Marketing Officer.
Update: Payvia tells me it is profitable company, with $400 million in sales last year, and that it will look at other acquisitions in the future “as we expand our focus onto emerging markets,” says a spokesperson. Today 80% of Payvia’s business is in the U.S. but it wants to expand that to build on the carrier connections that it has in 40 countries (among those, it powers carrier billing for Skype in the U.S.). Together the two companies will have 150 employees. [Original article continues.]
The move is an interesting one, in that it signals how Payvia, to differentiate itself from the pack, is creating applications itself that utilize its payment services.
“Our mobile payments offer resonates strongly with the market because it is built on our proprietary carrier connected technology that gives us a unique ability to understand consumer mobile usage,” said Darcy Wedd, CEO, payvia, in a statement. “Our clients have told us they also need a simpler way to link targeted mobile transactions to their marketing campaigns. By integrating Mogreet’s solutions on our platform we answer that need. As the only company to solve a known disconnect between traditional mobile commerce and engagement solutions, Payvia is well positioned to increase mobile’s share of the $252 billion* e-commerce market.”
Payvia says that it has the largest direct carrier connected messaging and mobile payments platform in the U.S., covering 120 million unique mobile users and processing billions of mobile messages every year. The company says it has paid out to merchants and developers worldwide more than $2 billion in global mobile commerce revenues. (There are other carrier billing platforms that will claim they are bigger, but the qualification here seems to be around the messaging platform that Payvia does this through.)
The trick with carrier billing services is that they give publishers, developers, and in this case brands and marketers, ways of offering goods and services to consumers on mobile devices, letting them complete purchases by charging those goods/services directly to their mobile bills. Services like these mean more seamless payments because they do not require users to enter credit card details, which can be painful to do on handsets and in some markets are a dead end because of the low penetration of payment cards. Other carrier billing companies like Bango claim that as a result carrier billing services are a more lucrative channel overall for getting users to pay for things on mobiles.
Last year, Payvia hit the news when it won a deal to power mobile/SMS-based donations for the Obama re-election campaign: a more classic example of how many mobile payments companies generate revenues, as the backend provider for services created by others, and also a sign of how Payvia was already formulating services that basically let users make transactions from within messages.
What the Mogreet acquisition will give Payvia is the ability to apply this to a wider variety of messages, and also a client base. Current customers of Mogreet’s include Cox Media Group, Emmis Communications and Gamefly.
The acquisition also signals a potentially new phase in the development of mobile marketing campaigns. While Mogreet’s services up to now have been more focused on encouraging people to click through to mobile web sites, or to enter short codes to receive further information, this potentially could mean that now marketers could create campaigns that encourage purchases from within the message.
Payvia is backed by Silver Lake Sumeru, Montgomery & Co., and Trinity Ventures (amount undisclosed), while Mogreet has raised some $14 million from DJF Frontier, Black Diamond and others.
More to come.