Roving Salespeople Aren't Just for Apple: Punchey Targets Mom-and-Pop Stores
August 16, 2012
Serial entrepreneur and investor Nathaniel Stevens is back in the business of helping small businesses with a new Boston-based tech venture called Punchey.
The start-up offers a payments system for local merchants that covers their mobile, Web and counter businesses, Stevens said. If things go well, Punchey should make "dumb" cash registers obsolete, the chief executive said.
In stealth mode until today, Punchey employs 10 full time and has already inked a dozen client deals.
Prior to founding Punchey, Stevens started and ran Yodle, a still-thriving search marketing company in New York. Funded by Draper Fisher Jurvetson and Bessemer Venture Partners among others, Yodle also started with a focus on small businesses.
Because they operate in such different spaces, the companies aren't working together today, but Stevens said that could become a possibility.
Punchey offers a "mobile terminal" that gives mom-and-pop stores the ability to take credit-card payments in stores the way roving salespeople do at Apple‘s retail locations. The hardware is compatible with iOS devices from the iPod touch to the latest iPad or iPhone, and works with personal computers and laptops.
Android-compatible Punchey card readers are on the way, Stevens said, though he didn't reveal timing.
If merchants don't have the Punchey device on hand, they can use Punchey's Web-based software to key in and process orders securely through any Web browser. The company charges between 1% and 3% per transaction processed, offered as a simple, bundled rate to each merchant.
Beyond its payment systems, Punchey gives business owners a dashboard and reporting tools to help them manage their customer relationships, communications and promotions.
"Knowing what your business got paid, where, when and how should help businesses reward their loyal customers, and incentivize others to come back, or fix lapsed relationships," Stevens said. "A better understanding of transaction history and customer patterns can also give merchants a kind of crystal ball."
With technology that spans payments, customer relationship management and sales forecasting, Punchey will compete with a wide array of companies in the business-to-business space such as BellyCard, Perkville and Groupon in the loyalty and promotions segment, or payments and CRM tech providers like Square, PayPal, Intuit and Salesforce.com.
Punchey's earliest customers included his family business, a Ford dealership in Milford, Conn., that influenced Stevens as he helped run it in his high-school years.
Other Punchey clients have included spas, barber shops, health clinics, art and framing shops, pool and home contractors, and transportation providers in Boston, Philadelphia and New York.
The CEO's eponymous fund, Stevens Ventures, invested a seed and Series A round of $1.7 million in Punchey.
The same fund backs consumer internet businesses like Twice, an online used clothing store; Family Leaf, a private photo and content-sharing site for family use; and LiveLovely.com, a website that helps renters find and get their ideal apartment.
Stevens calls himself a "serial starter forever," and he's channeling that creative energy into Punchey.
"I think this is a long-term keeper, but it's too early to tell if I'll manage this for an exit, or if it's a rocket ship and I'll be founding CEO 20 years from now," he said, like Reed Hastings at Netflix or Marc Benioff at Salesforce.com.
One thing Stevens won't call himself any more: a college dropout. Stevens set his undergraduate education aside to run Yodle. He went back to Wharton in 2009, and succeeded in everything but learning to code in Python there, he said.
"Going back to college at 26 was fun," he said. "I didn't have to go back, I wanted to go back. I had seven credits to go. Where better to get a fresh perspective and come up with new ideas?"
