PayPal, Visa expand Instant Transfers for fast payouts globally on all PayPal’s networks

The COVID-19 pandemic continues to put huge stress on people’s and businesses’ finances, and in an effort to meet some of the crunch, today PayPal and Visa announced an expansion of a service to get cash into people’s hands faster. Instant Transfer — a service where PayPal lets people and businesses quickly access transferred funds by moving them to bank accounts (cutting down waiting time from days to seconds) — is expanding globally to both domestic and cross-border payments in international markets.

This will mean that consumers and businesses globally that send or receive money by PayPal, Venmo or Xoom, or via Braintree, Hyperwallet and iZettle product solutions (all of which are part of PayPal), will now be able to opt for the Instant Transfer option to get electronic funds faster. PayPal’s services use Visa Direct for making the payouts.

The service is a progression and expansion of Instant Transfers, which PayPal launched in March 2019, initially in the US.

The likes of Stripe and Square, as well as payments providers in other regions like Europe, have also launched products over the years to cut down the waiting time it typically takes for transferred funds to become usable by recipients over their platforms.

But in recent months that kind of feature has taken on an increased urgency. Businesses and individuals are living in leaner times, with many out of work and commerce gripped in general with a slowdown in buying and selling (despite the fact that some businesses, especially larger ones, have in fact seen a boost). All of that means that the turnaround time of needing to use the money that you receive from a contact has shortened, and more simply become significantly more necessary.

PayPal said that a recent survey it conducted found that 76% of small businesses in the US have reported that they are struggling with cash flow shortages, and 91% said the having real-time settlement could help with some of that.

There is another reason why PayPal is rolling this out globally and that is for more competitive edge in what is now a very crowded payments market. E-commerce, as we have pointed out before, is a very localised affair, with consumers and businesses in each country converging around their own preferred methods for making and receiving payments, which may or may not be the same as those in other markets (and that’s before you consider the the places where money gets spent also vary massively country by country).

That is something that PayPal has tried to address both through the launch of its own services, as well as via investments in other interesting startups. By offering Instant Transfers within its own products, it’s one way of bringing more people to using and transacting on its own platforms — which gives PayPal better returns even as it works on making PayPal a more flexible service that can be integrated and used with a number of other services, even those that seemingly compete with it.

“Sending money to loved ones or giving small businesses real-time access to earnings is critical during these challenging times,” said Jack Forestell, CPO, Visa, in a statement. “By partnering with PayPal on a global scale, we are bringing together two trusted brands to provide hundreds of millions of consumers and small businesses globally with quick and secure payment options that can help them maintain financial stability.”

Visa Direct has had a big boost in business already this year, Visa said, growing by some 80% in Q3 — underscoring the need for faster access to funds that are being sent virtually. Speeding up settlement is an important thing to get right for e-commerce businesses that are hoping to present themselves as a viable replacement or proxy for doing transactions the old fashioned way, in person, regardless of how the pandemic or social distancing measures play out in the longer term.

“Digital is quickly becoming the preferred way for people and businesses to move money,” said Jim Magats, SVP Omni Payments, PayPal, in a statement.  “While the global pandemic has dramatically accelerated the shift to digital, we see this move to digital as a long-term change that will outlast the pandemic. We’re excited to expand our partnership with Visa to help more customers around the world get faster access to their funds, which is all the more critical during these challenging times.”

PayPal joins the ‘buy now, pay later’ race with new ‘Pay in 4’ installment program

PayPal today introduced a new installment credit option for PayPal users called “Pay in 4.” The name itself explains what the service offers — basically, it’s the ability for customers to pay for purchases, interest-free, over four separate payments. The service is an expansion on PayPal’s existing lineup of Pay Later solutions, which also includes PayPal Credit’s revolving credit line and its Easy Payments.

With Pay in 4, customers can choose to pay for purchases between $30 and $600 over a six-week period. Because it’s included with the merchant’s existing PayPal pricing, they won’t have to pay more fees to offer the option to their customers — as they do with several competitive “buy now, pay later” services.

For customers, the short-term payment option allows U.S. customers to pay for a purchase over time, without fees or interest. After their initial payment, the remaining three payments are automated. The feature will also appear in the customer’s PayPal wallet, where the payments can be managed.

Pay in 4 builds on PayPal’s tests with Easy Payments. The company says it learned that, at some price points, customers preferred the option to pay over a six-week period.

The service clearly is meant to compete with rival fintech services like Klarna, AfterPay, Affirm and others, which may or may not charge fees or interest up front, but do often tack on late fees when consumers can’t pay. Klarna, for example, even offers a direct competitor with its program offering four interest-free payments charged to your card every two weeks.

Because PayPal is tied to a customer’s payment card or bank account, it reduces the chance of a forgotten payment. But if the customer can’t pay, there will be fees involved. These will vary by state, as each state has its own late fee structure which PayPal will abide by, the company says.

“In today’s challenging retail and economic environment, merchants are looking for trusted ways to help drive average order values and conversion, without taking on additional costs. At the same time, consumers are looking for more flexible and responsible ways to pay, especially online,” said Doug Bland, SVP, Global Credit at PayPal, in a statement about the launch. “With Pay in 4, we’re building on our history as the originator in the buy now, pay later space, coupled with PayPal’s trust and ubiquity, to enable a responsible and flexible way for consumers to shop while providing merchants with a tool that helps drive sales, loyalty and customer choice,” he added.

Max Levchin is looking ahead to fintech’s next big opportunities

Max Levchin needs little introduction in the world of tech. As an entrepreneur, he’s been the co-founder of PayPal (now public), Slide (acquired by Google) and Affirm (reportedly about to go public), some of the hottest startups to have come out of Silicon Valley. And as an investor, he’s applied his power of observation and execution also towards helping many others build huge technology businesses.

We sat down with Levchin for a recent session of Extra Crunch Live, where he spoke at length about what he sees as some of the big opportunities in fintech. Here’s an edited version of the conversation. You can watch and listen to the whole discussion — which includes stories about Levchin’s coffee and cycling habits, and how many times he’s seen “The Seven Samurai” (hint: more than once) — here, also embedded below, and you can check out the rest of the pretty cool ECL program here.

How e-commerce failed to evolve since his days at PayPal

Even going as far back as PayPal I think the industry has devolved. I think fintech had the promise of really bringing simplicity, honesty and transparency to the customer. Instead, we ended up putting a really nice user interface on products that are not designed with the user’s best interest in mind. I’m a big fan of throwing shade on credit cards, because I think fundamentally, their business model is remarkably similar to that of payday loans. You are allowed to borrow some money and don’t really know exactly what the terms are. It’s all in the fine print, don’t worry about it and then you just make the minimum payments and you stay in debt. Potentially forever.

Extra Crunch Live: Join a live Q&A with Max Levchin today at 1pm PT/4pm ET

Money makes the world go round, as the saying goes. But how and where we spend it are still very much up for grabs.

One person who has been pondering that question and providing answers very successfully is Max Levchin, and we’re very excited to have him as our special guest today on Extra Crunch Live, where we’ll be interviewing him as well as taking questions from the audience.

Levchin could not be more central to the story of Silicon Valley’s rise, and the rise of fintech, in the last twenty years. As one of the co-founders of PayPal, he’s been at the center of how we use the internet to send and spend money from its earliest days. And as the CEO of Affirm, one of the hottest fintech companies around today, you can safely say he’s still in the game and winning.

But wait! There’s more! All that’s just part of Max’s fintech credentials. He’s also currently the chairman of health tech startup Glow, and his past roles have included chairman of Yelp and member of the board of Yahoo, and much more.

We are living in truly crazy times today, with the global health pandemic impacting every aspect of our lives, no less our tech lives. Max’s track record, and his own story as an immigrant building huge businesses in America, make him a very compelling person to weigh in on all of that. So please join us to watch, and participate in the conversation.

Extra Crunch Live is open exclusively to Extra Crunch subscribers. If you’re not already an Extra Crunch member, you can join here. We have the whole schedule of Extra Crunch Live talks as well.

I’ll be in the interviewer’s chair, and I plan to grill Max on all things fintech and foundery — where financial tech startups are going, how they are faring now, what founders need to be thinking about, and how to avoid big mistakes. I’m also really looking forward to what you, the audience, want to ask Max, too.

See you later for all the fun, Thursday August 6 at 4pm EDT / 1pm PDT / 8pm GMT. The links are below the fold.

We hope to see you there!

(Side Note: You can check out all our past episodes of Extra Crunch Live right here.

Details:

LA’s Kickback is a social shopping app that converts users into marketing channels through cash rewards

Frankie Bernstein, the Venice, Calif.-based serial entrepreneur, knows marketing.

At his last startup, Markett, Bernstein turned college students into brand ambassadors who were paid by the companies they repped for proselytizing about them on campuses.

Now he’s using that knowledge to launch Kickback on iOS and Android. It’s invite-only at this point, but the idea is that it uses company’s marketing budgets to create shopping rewards and incentives for app users. In the same way that Markett turned college students into advocates for apps like Uber and Lyft, Kickback will turn shoppers into brand ambassadors through its app.

In-app referrals and discounts for shopping are nothing new to the e-commerce world. In China, apps like Pinduoduo have turned into billion dollar businesses on the strength of referrals. Indeed, Pinduoduo recently raised $1.1 billion in funding to hit a valuation of nearly $100 billion.

It was only a matter of time before an American company tried to copy its success. Kickback — like most new apps these days — is invite-only.

Once past the waiting list, users get discounts on brands and can earn cash-back rewards when they shop or when they encourage their friends to buy something with the app.

[gallery ids="2016896,2016897,2016898,2016899,2016900"]

So far brands on the app include Walmart, Sam’s Club, Nike, Alo Yoga, Reebok, Away, Planet Blue, Sonos, Winc, Postmates, Casper, Kate Somerville, Lacoste, Columbia. Users get discounts or cash rewards when they shop and earn “kickbacks” when they invite someone to shop using their discount code. Cash rewards can be withdrawn using PayPal, according to a statement.

“Our mission is to take the billions of dollars brands spend on advertising and put that money directly into the pockets of the people,” said Franky Bernstein, Founder and CEO of Kickback, in a statement. “Brands know the most powerful form of marketing is word of mouth. We like to say that people are 100% more likely to go on a first date, watch a movie or, in our case, try a new product or service if a friend tells them about it. People have always loved sharing their favorite products and services with their friends. Now with Kickback, they get paid for it.”

Affirming the position of tech advocates, Supreme Court overturns Trump’s termination of DACA

The U.S. Supreme Court ruled today that President Donald Trump’s administration unlawfully ended the federal policy providing temporary legal status for immigrants who came to the country as children.

The decision, issued Thursday, called the termination of the Obama-era policy known as the Deferred Action for Childhood Arrivals “arbitrary and capricious.” As a result of its ruling, nearly 640,000 people living in the United States are now temporarily protected from deportation.

While a blow to the Trump Administration, the ruling is sure to be hailed nearly unanimously by the tech industry and its leaders, who had come out strongly in favor of the policy in the days leading up to its termination by the current President and his advisors.

At the beginning of 2018, many of tech’s most prominent executives, including the CEOs of Apple, Facebook, Amazon and Google, joined more than 100 American business leaders in signing an open letter asking Congress to take action on the Deferred Action for Childhood Arrivals (DACA) program before it expired in March.

Tim Cook, Mark Zuckerberg, Jeff Bezos and Sundar Pichai who made a full throated defense of the policy and pleaded with Congress to pass legislation ensuring that Dreamers, or undocumented immigrants who arrived in the United States as children and were granted approval by the program, can continue to live and work in the country without risk of deportation.

At the time, those executives said the decision to end the program could potentially cost the U.S. economy as much as $215 billion.

In a 2017 tweet, Tim Cook noted that Apple employed roughly 250 of the company’s employees were “Dreamers”.

The list of tech executives who came out to support the DACA initiative is long. It included: IBM CEO Ginni Rometty; Brad Smith, the president and chief legal officer of Microsoft; Hewlett-Packard Enterprise CEO Meg Whitman; and CEOs or other leading executives of AT&T, Dropbox, Upwork, Cisco Systems, Salesforce.com, LinkedIn, Intel, Warby Parker, Uber, Airbnb, Slack, Box, Twitter, PayPal, Code.org, Lyft, Etsy, AdRoll, eBay, StitchCrew, SurveyMonkey, DoorDash, Verizon (the parent company of Verizon Media Group, which owns TechCrunch).

At the heart of the court’s ruling is the majority view that Department of Homeland Security officials didn’t provide a strong enough reason to terminate the program in September 2017. Now, the issue of immigration status gets punted back to the White House and Congress to address.

As the Boston Globe noted in a recent article, the majority decision written by Chief Justice John Roberts did not determine whether the Obama-era policy or its revocation were correct, just that the DHS didn’t make a strong enough case to end the policy.

“We address only whether the agency complied with the procedural requirement that it provide a reasoned explanation for its action,” Roberts wrote. 

While the ruling from the Supreme Court is some good news for the population of “dreamers,” the question of their citizenship status in the country is far from settled. And the U.S. government’s response to the COVID-19 pandemic has basically consisted of freezing as much of the nation’s immigration apparatus as possible.

An Executive Order in late April froze the green card process for would-be immigrants, and the administration was rumored to be considering a ban on temporary workers under H1-B visas as well.

The President has, indeed, ramped up the crackdown with strict border control policies and other measures to curb both legal and illegal immigration. 

More than 800,000 people joined the workforce as a result of the 2012 program crafted by the Obama administration. DACA allows anyone under 30 to apply for protection from deportation or legal action on their immigration cases if they were younger than 16 when they were brought to the US, had not committed a crime, and were either working or in school.

In response to the Supreme Court decision, the President tweeted “Do you get the impression that the Supreme Court doesn’t like me?”

 

 

Facebook and PayPal invest in Southeast Asian ride-hailing giant GoJek

Facebook and PayPal have made investments in GoJek, joining Google and Tencent among other high-profile technology companies that have backed the Southeast Asian ride-hailing firm.

Facebook, for which it is the first investment in an Indonesia-based firm, and PayPal did not disclose the size of their checks. Five-year-old GoJek said the companies were participating in its ongoing financing round.

Gojek, WhatsApp and Facebook are indispensable services in Indonesia. Working together we can help bring millions of small businesses and the customers they serve into the largest digital economy in Southeast Asia,” said Matt Idema, Chief Operating Officer at WhatsApp, in a statement.

More to follow…

New Orleans-based Resilia raises $8 million from Mucker Capital to make nonprofits more efficient

Sevetri Wilson founded her first company, a public relations firm catering to non-profit organizations, as soon as she graduated from Louisiana State University back in 2009.

Eleven years later, and with a fresh $8 million round of funding in the bank, Wilson has taken the experience she amassed working in the nonprofit world and turned it into her new business, Resilia. From offices in New Orleans and New York, Wilson’s company offers a suite of services for nonprofits to better manage and report their finances and for grant-making and philanthropic organizations to find the groups that are working in the areas they want to support.

“We are serving a two-sided market,” Wilson said. “We are providing software solutions from non-profits.. Helping them come online… whether you’re a charter school or healthcare clinic and from there we have helped non-profits with their compliance and fundraising and built that into a subscription platform.”

There are approximately 1.56 million nonprofits in the U.S., according to a 2019 report from the Urban Institute. And those organizations contributed roughly $985.4 billion to the U.S. economy in 2015, according to the last available data. That’s roughly 5.4% of the U.S. gross domestic product.

Of those non-profits, public charities accounted for three-quarters of revenue and expenses representing $1.98 trillion and just under-two thirds of the total assets of the nonprofit sector, which amount to a whopping $3.67 trillion.

Those are huge numbers and represent a massive opportunity for companies that can find better, lower-cost ways to service these organizations and help make the entire industry run more efficiently.

“For large funders, their job is to deploy capital,” Wilson said. “They have to monitor them and pull reports and track data and do evaluations.. If you are Oxfam America we are essentially covering their southern territories and the organizations they’re funding around workforce development.”

Now, in the wake of the economic collapse that’s accompanied the COVID-19 outbreak in the U.S., nonprofits are taking an even more central position in the U.S. economy.

With a market representing hundreds of billions of dollars its no wonder that the Louisiana-based investment firm Callais Capital chose to back the company. Notably, Resilia also managed to bring in Mucker Capital, the Los Angeles-based investment firm that’s coming off one of the best years in its history.

Mucker, which raked in marquee returns last year off of its seed investment in Honey, the browser extension coupon service which PayPal acquired for $4 billion, is steadily expanding from its Los Angeles home and building up a presence in the Southeast.

“Entrepreneurs outside of LA look more like LA entrepreneurs than they do like Bay Area entrepreneurs” said William Hsu. “Working with them… we saw that skillset of working with LA could be replicated somewhere else.”

That somewhere else was Nashville, where Mucker has a presence through Monique Villa, the firm’s investor and scout for deals across the Southeast.

“We charged her with looking at every deal in the Southeast,” said Hsu. In the year-and-a-half that Villa has been investing, Mucker has made three public investments: Go Check Kids, Blueprint Title, and now, Resilia.

“One of the things that is interesting to us is how the rest of the US looks at New York and San Francisco as an elitist enclave,” said Hsu. “The populist part doesn’t connect or look up to the ethos of SF or NY.. We want to be an accessible and populist VC brand.”

It’s hard to get more populist than investing in a company founded by an African American woman who went to a land-grant university in Baton Rouge, La.

There’s already real revenue coming in for Wilson’s startup. Large donor customers pay $199 per-seat per-month for access to the company’s list of well-run nonprofits, and nonprofits pay $99.99 per month for access to the management tools, grant writing support and other features that they may need.

We’re in such a good position because our product was created to capture innovation and mitigate grants and connect to capital in organizations to have a better understand of where that’s money is going and wether or not it’s being wasted,” Wilson said. 

Nigeria’s Helium Health raises $10M Series A for Africa expansion

Nigerian startup Helium Health sits in a good position during a difficult period, according to its co-founder.

The Lagos based healthtech venture is in the black, has batted away acquisition offers, and just raised a $10 million Series A round, CEO Adegoke Olubusi told TechCrunch.

The startup offers a product suit that digitizes data, formalizes monetization and enables telemedicine for health care systems in Nigeria, Liberia, and Ghana.

Helium plans to use the latest funding round to hire and expand to North and East Africa, including Kenya, Rwanda, Uganda and Morocco, Olubusi confirmed on a call.

He co-founded the startup in 2016 — with Dimeji Sofowora and Tito Ovia — to bring better delivery of medical services in Nigeria and broader Africa.

“It’s really about tackling three core problems that we see in the healthcare sector in Africa: inefficiency, fragmentation and a lack of data,” said Olubusi.

When he and co-founders Sofowora and Oviato set out doing research for Helium, they noted a data desert on medical info across the continent’s healthcare infrastructure.

“We figured out very quickly that that is a long term problem to solve. And the best way to get the data and access to it is to give simple technology to the providers and let them use it to make their lives more efficient.”

Helium Health has since developed several core product areas for healthcare entities with application for providers, payment, patients, and partners.

It offers tech solutions and developer resources for administration, medical records and financial management. Helium Health has digital payment and credit products for hospitals and insurance providers.

As part of the latest financing, the startup is launching several new products — such as the MyHelium Patient app to facilitate appointments and information sharing between healthcare providers and citizens.

Images Credits: Helium Health

Helium also accelerated deployment of a telemedicine platform in response to the coronavirus hitting Nigeria and the lockdowns that ensued.

“In the last three weeks since we launched we’ve had roughly 360 hospitals sign up, and they’ve had thousands of [online] visits already,” Olubusi said.

Helium Health generates revenues by charging percentages and fees on its products, services and accompanying transactions. Current clients include several hospitals in the West Africa region, such as Paelon Memorial in Lagos.

Helium Health’s model got the attention of the startup’s $10 million Series A backers and Silicon Valley accelerator Y-Combinator — which accepted the startup into its spring 2017 batch.

Global Ventures and Africa Healthcare Masterfund co-led the investment with participation that included Tencent and additional Y-Combinator support.

Global Ventures General Partner Noor Sweid confirmed the Dubai based fund’s co-lead of the round and that the firm will take a Helium Health board seat.

The path of the startup’s CEO —  Adegoke Olubusi — to tech founder passed through the U.S. and traditional corporate roles. He went to Maryland in 2014 to complete an advanced degree in engineering at Johns Hopkins University, then did a stint at Goldman Sachs before landing positions in big tech with eBay and PayPal.

Olubusi found work with big corporates less than stimulating and gravitated to forming his own company and returning to Nigeria.

“When I was at eBay and Goldman I was really bored and I wanted to do something more challenging,” he said. “We thought, ‘why don’t we pick a problem that is a long-term problem in Africa,'” Olubusi explained.

Helium Health founders (L to R) Dimeji Sofowora, Tito Ovia, and Adegoke Olubusi: Image Credits: Helium Health

The founder believes the products Helium Health creates can improve the poor health care stats in countries such as Nigeria — which stands as Africa’s largest economy and most populous nation.

Nigeria also ranked 142nd out of 195 countries on health performance indicators in The Lancet’s 2018 Healthcare Access and Quality Index.

On the dismal stats, “We need more properly run hospitals, and we need more profitable hospitals, health systems and health care providers,” said Olubusi.

Better monetization and organization of hospitals could lure more doctors back to African countries, he believes.

“Half my family are doctors but none of them practice in Nigeria. Everyone’s practicing all over the place, but Nigeria,” Olubusi said.

The founder also sees a more digitized and data driven health care sector as something that can draw more entrepreneurs to African healthtech. Compared to dominant sectors, such as fintech, health related startups in Africa gain a small percentage of the continent’s annual VC haul — only 9.3% by Partech’s 2019 stats.

“There are people who want to invest in the market but they can’t…and founders can’t really tackle a healthcare problem because they don’t know what’s going on,” he said.

As for his venture, Olubusi expects growth even given the precarious economic outlook COVID-19 is creating for countries, such as Nigeria — which is expected to enter recession this year.

The coronavirus and lockdowns are shining a light on the country’s healthcare inadequacies (according to Helium Health’s CEO) that people can’t ignore, including the elite.

“This is the first time they can’t get on their jet and leave so they have to go to the hospitals we have. The system was neglected for the last few decades because people had that [previous] option,” said Olubusi.

“I’m hoping this coronavirus crisis will be a period that forces everyone to rethink what we’re doing [on healthcare].”

That could lead to more business for Helium Health.

The startup doesn’t release financial information but has positive net income. “We do generate revenues in millions of dollars and are profitable,” Olubusi said.

Helium Health has received acquisition offers, but declined them, according to its CEO. Olubusi and team intend to grow the venture to the point where it can list on a major global exchange.

“We know this is the kind of business we can take public, without having to sell,” he said.

Equity Monday: Intel covets Moovit, two early stage rounds, and Uber’s earnings

Good morning and welcome back to TechCrunch’s Equity Monday, a jumpstart for your week.

Equity had a busy last few days, so to help you catch up: Friday’s episode was a lot of fun (Duolingo, Figma, OMERS, and aquafaba), and we also dropped an Equity Shot on Saturday, digging into the first major technology earnings week.

But this morning we were busy digging through what’s happened over the last few days, and what’s to come. Here’s the rundown:

We wrapped asking that’s going to come for companies that were still speculative businesses before the slowdown. They’re going to vaporize, right?

Equity drops every Monday at 7:00 AM PT and Friday at 6:00 am PT, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.