In the past few years, there has been a paradigm shift in the way we think about money and its value: dematerialization of payment has detached the value of money from its physical use. This is due to the increasingly widespread use of credit cards and lower fees, but also to a strong push of technology and innovation in this specific environment. Thanks to the scalable structure and the innovative nature of mobile payments, startups are now playing a major role in this revolution.
In France, and particularly in Paris, there is a thriving startup context that is largely due to strong support by public entities. Two of the startups interviewed for this article received funding from Bpifrance, which provides fast and effective loans to French startups. Around this infrastructure, a broad network of accelerators and incubators (such as SNCF Accelerator and Big Bang Accelerator) supports their development.
The key players in mobile payment who met at the ‘Hacking de l’Hôtel de Ville’ all have business models with similar characteristics: new technologies make it possible to offer new services and payment modes at virtually no cost, while online payments are the engine that allow these disruptive startups to run and develop their business.
Parisian M-payment startups provide commercial partners with new ways to improve the quality of service for end users. They enhance the customer experience. While payment is being made, they add features and feedback useful to the partner. TIPSmeee is changing its business model to have a positive social impact, through a payment system that lets users offset the pollution of goods purchased or make donations and tips. They provide a more efficient solution to an old problem: now you can tip with the credit card!
There are older startups launched 8 years ago like TIPSmeee, and new ones like Billee, but both have the same target: impact the customer journey, personalize and create a bond with the client while he is paying. For instance, Billee offers an app that not only lets you split the bill at restaurants, but also creates a network amongst customers to certify reviews and feedback. Another source of value add is the data gathered at the time of payment, and their ability to extrapolate information from it. They provide data analytics services to the partner.
TIPSmeee has reached a significant size and is hoping to scale up their business. They have successfully raised funds through the national financing infrastructure for startups. Now they are looking for more partners and clients, to reach the required momentum. Billee, on the other hand, is still defining its service structure and is rapidly improving thanks to its accelerator.
These startups, which have thus far focused exclusively on the French market, hope to attract interest throughout Europe. Once they are able to expand beyond French borders, they will reach the critical mass required for revenue growth. Both these business models require a wide network to be profitable. Competition at an international level is high in the mobile payment system, but thanks to the resources provided by the French administration and the support of private entities that believe in this industry, they have a good chance for success!
By Lorenzo Stradi and Fabio Busicchia, students at Centrale Supélec Paris.
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