Originally posted on TINC Magazine
TINC Magazine recently contacted Doug Bobenhouse, President and Co-Founder of Synchology, which works with companies to offer custom, branded debit cards with rewards programs for customers.
TINC: Are you are self-funded, FFF, seed funding, series B (chunk of money), C (several chunks of money) or D (line credit with banks, and self-supporting)?
Synchology was initially funded as a subsidiary of Total Card, Inc.(out of Sioux Falls, SD) in June 2009 and received $1.5M in growth funding from Lund Acquisitions, LLC, helmed by Sioux Falls, SD banking veteran Mert Lund, in late 2011.
TINC: What does your company provide? Our understanding is that you create debit cards with the company's logo on it. The concept is that as the card is passed around, it builds brand familiarity. You can earn rewards for product from the company who sponsored the debit card. Then you guys offer marketing consulting services. If that is not correct, then please let us know, in 150 words or less, the purpose of your company and product.
Synchology designs, builds and manages co-brandable prepaid debit card programs with rewards, very similar to a co-brandable credit card product with rewards, but cash based. Everyone is approved, there are no overdrafts and there is no debt creation.
Synchology’s goal is to offer an amazing user experience to accountholders, build strong brand / consumer relationships and deliver measurable value to both brands and consumers.
Top brand partner benefits:
(1) comprehensive trend data from portfolio performance
(2) external loyalty program funding
(3) revenue sharing
Top consumer benefits:
(1) enhanced brand relationship including access to rewards and other benefits
(2) access to highly relevant deals and offers
(3) innovative account management tools (Synchology built)
TINC: What's the range of employees you have on staff right now?
We currently have 1-10 employees.
TINC: How did this product idea come to be?
Synchology’s founders noticed a number of market conditions converging to create an opportunity.
- Consumers are increasingly frustrated with their banking relationships.
- Online banking is not a great experience.
- Prepaid debit is becoming more mainstream.
- Banks are ending their reward programs.
- Consumers are interested in deals and offers and rewards from their favourite brands.
- Brand loyalty programs are expensive for brands to run.
- Co-brand credit programs are not appropriate for all brands.
TINC: What growth phase is your company in currently?
We have been in a quiet public beta using 3rd party turn key platforms under the our in house brand The Jump Card and a client program called Simple Spend for the last 1.5 years and are readying the launch of our new platform in May with new version of The Jump Card followed shortly by 2 client programs (to be announced at launch).
TINC: If TINC Magazine also sold shampoo, and we wanted to sign up, how much would it cost to get a branded debit card? Would we be able to determine our own rewards structure? Would you take a percent? How is this priced? What bank or company provides the banking aspect of the card?
Synchology looks for brand partnerships offering the potential to generate 50,000+ new accounts annually and at this time all programs are custom. From card art, to consumer fees, to reward earning and redeeming structures, we work with our brand partner to optimize all aspects of the program for success with their audience. Implementation costs are determined on a case by case basis and decrease based on the ability of the brand partner to market the product. We offer an ongoing revenue share to our brand partners.
Reward value funded by Synchology may be driven into a points bank with a standard reward redemption tool (merchandise, services, gift cards, travel, etc.) or this value may be delivered directly to the brand partner. The brand partner may already have a reward currency or they may wish to simply offer their customers an account credit to be applied at next purchase. Synchology does not take a percentage of the reward value earned by consumers.
Program implementation takes 8-10 weeks. Our issuer is First Bank and Trust of Brookings, SD. All accounts are FDIC insured up to $250,000, though the max balance is $10,000.
TINC: If a customer banks at Chase (as an example), and already has a debit card, would this be a second debit card for that account? What banks is this compatible with, or does it work with any bank?
This is a stand-alone program, meaning it is not a de-coupled debit system. Our cards are issued by First Bank & Trust in Brookings, South Dakota.
TINC: One more question, I just looked at an article that said there are 300 million co-branded credit cards on the market. Cardhub and Credocard seem to offer similar branded cards and Mastercard has a program as well. How are you different and better? Is your offering more open to smaller businesses?
Synchology is very specifically focused on the co-brand prepaid debit reward card space. By focusing exclusively on this vertical, we’re able to avoid being an all things to all people player and focus on delivering an excellent experience to consumers and measurable value to our brand partners.
Our primary card brand partner is Visa, but we are able to issue Mastercard or Discover cards as well through our issuing bank.
