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FiveStars Raises $13.9 Million From Lightspeed Venture Partners & DCM
FiveStars announced today that it has received $13.9 million in Series A funding from Lightspeed Venture Partners and DCM to support the company’s product development and growth into new markets. The company also announced that it has tracked more than 3.5 million items purchased by repeat customers at local merchants. FiveStars loyalty solution is integrate directly into over 90 percent of existing point of sale (POS) systems, making it easy and affordable for merchants to connect with customers based on their in-store, online and social behavior.
“On average, those customers are visiting 15% more often and are purchasing 1,100 cups of frozen yogurt every week! Best of all, we’ve been able to do all of this without offering deep discounts; it’s real profit I can count on month after month.”
“Every consumer knows a few local gems — the places where we love to eat, drink, and shop. With FiveStars, you earn rewards by frequenting the places you love,” said Victor Ho, CEO and Co-founder of FiveStars. “Meanwhile, every merchant knows that the best marketing tool is word-of-mouth and repeat business from loyal customers. FiveStars enables merchants to amp up these age-old techniques in a world that’s increasingly networked, social and mobile.”
FiveStars offers consumers a single card that they can use to earn rewards for everything from yogurt to yoga, without the hassle of carrying different cards for different stores. For merchants, FiveStars is an inexpensive and easy-to-use solution that integrates with over 90 percent of point of sale systems.
FiveStars cards are accepted at local merchants and retailers around the country, including SUBWAY, Round Table Pizza, Metro PCS, and Baja Fresh locations.
“I’ve tried several different customer loyalty programs and nothing comes close to FiveStars. 2,200 customers sign up for the program within the first three months,” said Nichole Garcia, a franchisee of Tutti Frutti, the specialty frozen yogurt chain with 584 locations worldwide. “On average, those customers are visiting 15% more often and are purchasing 1,100 cups of frozen yogurt every week! Best of all, we’ve been able to do all of this without offering deep discounts; it’s real profit I can count on month after month.”
“Five Stars’ point of sale integration allows retailers to deploy loyalty solutions in a frictionless way and offer the most personalized marketing programs,” said Peter Nieh, Managing Director at Lightspeed Venture Partners. “We believe that FiveStars has the team and technology to disrupt this market and look forward to working with them as they grow.”
Through integration into the POS, retailers also receive real-time tracking and analytics on customer spending habits, to help them customize promotions and rewards. FiveStars requires no extra equipment, such as iPads or smartphones, and includes fraud prevention tools as well as integration with email, text and social networks like Facebook.
“Studies have consistently shown that it is far more expensive to acquire a new customer than it is to deepen the bond with an existing one. It is imperative for merchants to identify, engage, and reward their most valuable customers,” said Jason Krikorian, General Partner at DCM. “By connecting customer loyalty to the cash register, FiveStars can truly help retailers deliver better customer service, increase customer loyalty, and ultimately drive increased sales and profits.”
FiveStars cards are currently available at ssome retailers and local merchants across the country. FiveStars was founded in 2010 by Victor Ho and Matt Doka, both of whom advised Fortune 500 executives on loyalty while working at McKinsey & Company. FiveStars has raised $16 million in funding to date. Other investors include YCombinator, Mayfield Fund, and angel investors, Hadi and Ali Partovi, and Chamath Palihapitiya. More information is available at: http://www.FiveStarsCard.com/.