Ask HN: Rate this Start Up - Venmo.com | Hacker News Reader

Ask HN: Rate this Start Up - Venmo.com

venmo.com

40 pointskeltecp1160 comments

I like it - it's software the encourages you, maybe even forces you, to share the experience with someone else turning every user into evangelist. It also seems like it would make financial transactions very simple.

My only concern would be that phone numbers still haven't become non-transferable identification.

I'm sure you have considered these issues before but I would wonder about:

My parent dies and their cell phone account is turned off - how do I get their money out of this service?

My wife and I share a cell phone but we don't share checking accounts.

Someone has already created an account for my phone number.

I use multiple cell phone numbers.

etc.

Just curious: Do you eat the transaction fee if people fund their accounts with credit cards? If so... it seems like people might pay themselves thousands of dollars to rack up rewards at your expense.

It's a great idea, but in reality, it's going to be a very tough job to make it secure and legal. If you haven't read the PayPal chapter in "Founders at Work" yet, you should.

Or, PayPal Wars: http://www.amazon.com/PayPal-Wars-Battles-Media-Planet/dp/09...

It also mentioned the legal hoops they had to jump through...and was a very interesting read.

In South Africa (I moved to New York five years ago), it is common for people to transfer money from their bank account to that of a friend's electronically - either online or on your phone.

I was quite surprised coming to the US that it is not common here as well.

Actually despite my earlier comment, this practice is also very common in New Zealand, and I too was surprised when I spent a year in Washington, DC. However, the idea of doing it via SMS has never taken off here (as per previous post).

It's the same in Europe. My wife is Spanish and when I learned that you could transfer money to anyone's bank account easily and free, my brain exploded.

It's amazing that the U.S. is (was?) considered the leader of technological innovation, but we're still so backward on something like this. It reeks of corruption and lobbyists.

The fact that the site is "godaddy secured" fills me with confidence.

I get the sarcasm, but I don't get the point. Does the fact that GoDaddy has a horrible site/shopping experience from a usability standpoint somehow translate into a security stamp of approval that is "watered down"? Has GD has some major security breach? (maybe they have, I don't know).

Are everyday users of this service going to care?

The point is that GoDaddy has destroyed their brand to the point where their security guarantee inspires nothing but a visceral "ugh" reaction from everyone who's ever used them.

250% revenue growth over 3 years isn't evidence of a destroyed brand, IMO.

http://www.inc.com/inc5000/2009/company-profile.html?id=2009...

That will work only if it is guaranteed that the sender phone number in an SMS message cannot be spoofed. Is this the case? Does anyone know?

SMS isn't secure.

Not even close to secure.

I haven't worked with US phones, but in Europe I can send you a SMS message that appears to be from any MSISDN (phone number). Violates all kinds of terms of service and contracts, but there's absolutely no technical verification of origin of standard SMS.

What's the revenue model?

I love how this comment has no upvotes.

That says a lot about startups now a days.

They could probably get away with charging 1% or 2%, but it looks like they don't take any transaction fees.

It clearly states on the site they make money of every text message sent.

edit: from the info pages

"We charge a transaction fee every time you receive money. Sometimes, the person sending you money can pay for the fees associated with the transaction. Those fees are outlined on our Venmo Fees page."

There's also a premium service for businesses.

http://info.venmo.com/pricing/pricing-plan-comparison/

But the person who submitted the story says otherwise:

http://news.ycombinator.com/item?id=948793

As of right now they are not charging... it is open beta... but i'm sure that will change.

You need some kind of a security code / pin system to prevent against fraud. Venmo has to match the pin in the message sent along with the phone number the message is sent from. And proceed with the payment only if the pin matches.

Venmo $10 to Jenny 1990

Where the last 4 digits of the message - 1990 in this case - is the security pin code.

A bunch of you all emailed for invites--we're sending a batch out later this week. We'd love to hear more of your thoughts once you use it. A few cursory answers: everything is free for now (we're still trying to figure out what the transaction fees will look like, but they will be competitive with credit card), Paypal is a great comparison and as someone recced with a link Paypal Wars is an awesome read, we love the Godaddy brand too, the syntax is very flexible and constantly adapting to the way people want it to work, if anyone knows the textpayme guys would love to chat with them (i'm @kortina), Fundraiser events-YES!, and yes security and fraud are tough problems but we are eager to tackle them. Think that covers most of them. Again, thanks to those who wished us luck and provided criticism.

If it's a service that holds any large amount of money, I'd want to make sure it's associated with or somehow endorsed by a major, trusted organization. The site looks nice and all, but still like a small business.

Also, doesn't Paypal offer this?

and we use advanced encrypting algorithms to protect the financial information stored in our system.

encryption algorithms

Have you thought about giving the option to link to paypal accounts?

Early adopters will not have venmo accounts but will have paypal accounts. You may get more new users if you give the option to use funds in the paypal account. The service could at minimum send the user an e-mail with a link to the paypal destination and amount.

http://www.crunchbase.com/company/textpayme anyone?

Also:

https://www.paypal.com/cgi-bin/webscr?cmd=xpt/Marketing/mobi...

There are A LOT of rules around money transaction services and the feds have only gotten stronger in their enforcement of them post-9/11. You'll need to watch out for so much fraud from carders. Best of luck, but perhaps you should talk to the textpayme guys, who did some very fancy things to avoid regulation.

I'd make that "godaddy secured" animation static. It completely distracted me from your how-it-works anim up top.

I think buying your own SMS short code is key to making this service look legitimate to new users. No one wants to text information about money transfers to a phone number that could be anyone.

Also, the phone graphics on your homepage are copied directly from the TextMarks site!

This is a hot space, note that Gartner just released a list of the top 10 consumer mobile applications for 2012 and Money Transfer via SMS is #1: http://www.gartner.com/it/page.jsp?id=1230413

first impression - how flexible is the input syntax? as a user, i'd be mad if i thought i typed in something syntactically correct (e.g., "venmo $5 to bob for lunch") but there was actually a syntax error and my transaction didn't go through

This is almost exactly how Paypal started - except they 'beamed' it over instead of using SMS.

Eventually they realized that people were much more interested in using their website to transfer money, hence what we have today..

Nicely done interface. A minor nitpick, if you send SMS to 646-863-9557, shouldn't the second screen have a different phone number? Or does all of the interaction you show there happens on the person sending the money?

Very cool & good luck! I hope you can bring down PayPal to their knees.

what happens if someone picks up your phone and writes venmo $100 to 555-123-4567 for hack. 555-123-4567 being their number? how can you issue a refund or deal with issues like this?

They got around this with Pago in NZ (https://www.pago.co.nz/section261.aspx) by working with the banks. The money doesn't get transferred from your primary chequing account - you have a separate account which is your Pago 'wallet'. Only that money is accessible to the service, and you have to use internet banking to transfer money from your chequing account into your wallet.

i understand. but the money still gets transferred from your 'wallet' account to the destination. how is that a reversible action in case of user error or malicious intent?

Pretty cool, but I don't like the logo, it's hard to read. V & e have too similar colors and the "Ven" part is too tight above each other.

My bank does this for free, and I can also withdraw the money from any of their ATMs as cash instantly if I want.

Your bank lets you send payments via SMS? What's your bank? Mine doesn't do that, I'd be interested in switching.

http://www.garantibank.com/index.html Best online banking I've seen so far too, I think they've won awards for it.

Home page has annoying animation. Guess there's still room for improvement.

I tried it out, it's super viral... I think it'll spread very easily, just like Paypal did.

That's what I thought when I signed up for Pago - an identical service which launced in New Zealand three years ago:

https://www.pago.co.nz/section261.aspx

It was launched by one of the major banks in co-operation with one of the major wireless providers. Still, it never took off. I certainly never found myself using it. I would've thought New Zealand was a prime test market, because we are incredibly reliant on txt messaging down here; around 85% of the population regularly use txt messaging.

I should note that when I say 'identical', it was identical. They have since shifted more toward online payments. It used to be solely for one-to-one payments. In fact one of the use cases on their original marketing website was the ability to 'split a restaurant bill'. Which is similar to the use case from the venmo website.

Whoever makes mobile payments ubiquitous will make billions.

There are no transaction fees?

100% free

I don't see the point here. I mean, I could pay Jenny back next time I see her. Am I missing something ?

Sending the SMS is instant, waiting until next time isn't.

And what does instant payment bring ? To me, it looks like a solution looking for a problem.

PayPal did pretty well with the idea.

PayPal is about secure payment, it doesn't need to be instant.

I don't see the point here. I mean, I could write Jenny a telegram if I wanted to tell her something. Am I missing something?

There are a few things here - 1) You don't have to remember that you need to pay. You pay instantly and be done with it. 2) Jenny may be someone you don't often see. 3) You're away but want to pool in for a gift or celebration back in town.

Thank you.

Word.

1. I am confused if I text a shortcode, or if I have to text that 646 bullshit?

2. I should be able to click on step 1/step2/step3 in your animation in case I want to review the information contained in that slide a little longer.

3. You have to be EXPLICIT about fees on the front page.

Think about use for Political/Charity Fundraiser events... I think the product is very beneficial.

great idea, very clever. i posted this to pikk: Thrive or Fail? Send And Receive Credit Card Payments Through SMS Text Messages [VOTE] - http://www.pikk.com/297fd

I am not sure why you would want to do this. If it is interesting, then please discuss it here. Don't spam for another website to discuss it there.

Reply on news.ycombinator.com