It has been called vapourware, a laughing stock, and an instant flop. The mobile payments app Clinkle attracted a huge $25m seed round in 2013 but then went quiet. Billy Bambrough investigates the app based start-up and where it can go from here
Arrogant, late, and without the technology that earned the company its seed money Clinkle personifies the app start-up company in the early 21st century.
Like the dotcom bubble there is a lot of money being thrown around but no one seems to know where the value is in any of the many mobile payments offerings on the market. And also like in the dotcom bubble there are cracks appearing in companies that were once lauded.
The Clinkle saga, a tale that feels as though it is in its death throes, began in 2009 and culminated in September 2014 with an app that offered nothing more than a prepaid debit card and an online wallet to track your spending. Is this really the kind of innovation $30m buys in 2014?
People were expecting a revolution, what they got was the mundane
Hypothetically speaking, if we were all using Clinkle it would be great (though I wouldn’t bet on its systems being up to the challenge). One of the biggest incentives for using Clinkle is that you can transfer money to other Clinkle members for instantly and for free, this alone should be enough to keep people interested.
When a bank transfer takes typically three days in the US, cutting this time to nothing is an attractive idea but it’s useless if no one you know is using the service.
Payments is beginning to have a lot in common with social media
It clearly isn’t just Facebook’s early day exclusivity that Clinkle is trying to replicate, what it is creating is more of a social network than a payments platform. But really, these days what’s the difference?
Getting people on board is now the most important aspect of a social media platform or a payments app – If your friends aren’t there then there is no point you being.
A lot of this similar success can be found in Clinkle’s arch rival Venmo. A p2p payments app from Paypal, Venmo has done a great job of blending instant payments with social media, allowing users to pay fellow Venmo users instantly and share payment requests on their timeline.
What’s the difference between Venmo and Clinkle?
While Venmo’s USP is instant payments that you can tell your friends about, at Clinkle it’s all about payments that earn you something that back and let you share the love.
Clinkle calls them "treats", making all users sound like the company’s pets. The idea being that you gamify the spending experience, making it possible for each payment earning you a reward – something free or even a refund on your last purchase. Once you’ve got a treat, you can either reap the reward yourself or pass it to someone else.
Both Clinkle’s treats and Venmo’s social sharing are interesting ideas that might may you more inclined to use one or the other. Ultimately you’ll want to be using the same platform as the one your friends are on, and any additional features are a nice bonus.
Speed of growth is the biggest issue both these budding services are facing. For Clinkle, and the investors that backed it, a buyout by a social media company with an already established user base would be the best case scenario. Without rapid adoption, a slow fade to obscurity awaits.
The big question around Clinkle that all of the tech blogs are asking is what happened to the feature that was supposed to allow payment information to be transferred from a shopper’s phone to a store’s checkout system using ultrasound technology? It looks as though, for now at least, we will have to wait. Perhaps the future isn’t now after all.
The Clinkle car crash as it happened
- Clinkle was founded in 2011 by Lucas Duplan, then a computer science student at Stanford University.
- Accel partner Jim Breyer became an investor following his first meeting and product demonstration with Duplan and participated in a round of funding for the company.
- By June 2013, Clinkle had raised $25 million from a broad range of investors, including Greene, Andreessen Horowitz,Intel Capital, Intuit, Peter Thiel, and Owen Van Natta.
- In July Duplan moved the 50-person company from Mountain View to San Francisco.
- In October 2013 former Netflix chief financial officer Barry McCarthy became Clinkle’s chief operating officer.
- Two more former Netflix executives later joined as vice presidents.
- In November 2013 Chi-Chao Chang, former Yahoo and xAd executive, came on board as vice president of engineering. He remained at the company for 24 hours.
- In December 2013 the company laid off a quarter of its employees.
- McCarthy left Clinkle after less than 5 months at the company in Feburary 2014.
- The app launched to much ridicule in September 2014 allowing users to pay money to friends Clinkle accounts, get a pre-paid Visa, and earn gifts like Baskin-Robbins ice cream for buying stuff with your Clinkle card. Not the revolution we were hoping for but far from write off