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Concerto snags $21.2M to bring co-branded credit cards to more brands –

Rewarded branded programs such as the long Delta Delta partnership with Amex are the key factor in customer credit card decisions. According to GigaPoints / Ipsos opinion polls, more than half of Americans say earning points makes them want to use a credit card more often. In particular exploration (by Finder), almost a third of respondents said they used a credit card to collect reward points.

But building these programs can be challenging for the brand. If promotions (ie, unsecured loans) go up, programs – especially if they operate in difficult environments – could be financially disadvantaged. The questions usually arise from how programs are managed jointly (e.g., producer and brand) and how profit-sharing arrangements are structured.

To address some of the challenges surrounding credit card collaboration, Dan Duncan, founder of Mercury Financial credit card providers, has launched. Concerto, A startup that develops branded credit card programs using “advanced data analysis.” While acknowledging that credit card payments and loyalty programs are not really new, Duncan argues that the Concerto approach is unique in terms of technology including machine learning to measure and predict risk.

Concerto announced today that it has raised $ 21.2 million in investment funding led by Matrix Partners and PayPal Ventures and GoldenTree Asset Management. GoldenTree also said it would form a joint venture with Concerto to finance at least $ 2 billion in credit cards. recivables.

“Credit cards represent one of the biggest purchases of customers and the satisfaction equipment available to the brands, but even if they overcome the challenges often imposed by banks, designing and implementing an effective card program requires is a valuable time, resource and experience, ”Duncan told TechCrunch via via TechCrunch. email “For this reason, cards are going to be one of the biggest untapped opportunities… The Concerto platform is disrupting all of this to give businesses the products and credit they need, along with their ability to easily create and deliver amazing and well-organized loyalty programs, people will make love. ”

To take action, branded credit cards – which are not confused with personal store credit cards – are sponsored by a number of parties: a brand, such as a retailer, and a bank or card network such as Visa, Discover, or Mastercard. The brand should partner with a financial institution to issue a branded card, which often ends up being an institution that promotes the issuance of a credit card or credit card as a brand name.

Customers generally like branded cards. Nearly 53% of all U.S. card holders had a card in 2014 that relates to a hotel, airline, or other type of business or group, up from 46.4% in 2010, according to the Simmons National Consumer Survey data. But Duncan said programs can be a headache for species.

“Some businesses do not have access to the financial resources or loans enjoyed by large corporations – tools that will help them compete better in the modern economy,” Duncan said. “[L]oyalty and brand-sharing programs run by banks are not optimized for couples. Large banks constantly prioritize their needs over their partners through narrow credit acceptance. This, in turn, prevents many businesses from being able to take advantage of credit to help finance the company’s growth, while still making it unnecessary. “

Expansion of access

Duncan’s first move after leaving Citicorp and Chase, where he was head of credit card risk management, was Austin Logistics – a company that developed analytics software for financial institutions. Decades later, it launched CreditShop (later renamed Mercury Financial), which offers loans and credit cards to customers with low credit scores.

Concerto, Duncan aims to defeat the banks he claims are reluctant to promote a partnership brand above their own. “Industries in general are not simply updated to serve the needs of businesses or customers through cards efficiently,” Duncan said. “Technology now has the potential to do so in very smart ways, if you have the motivation to use it strategically.”

To achieve this, Concerto does not change the brand connection of the bank or the card network. But the company is working with these agencies to create loan authorization models using “multi-million” office loans and application data points. (Research says tusay that such species are prone to bias, especially minorities with little data in their credit history, but Concerto did not answer a question about the steps to be taken to reduce bias. APIs, which allow “card experience” and reward features to exist in the brand and web browser.

Clearly there is a need – Concerto says it is actively signing credit card partners with a variety of “different industries,” formerly Major League Baseball (MLB) baseball teams. Duncan said the Texas Rangers, Los Angeles Angels, Baltimore Orioles, and Cincinnati Reds will be releasing Mastercard cards and programs in the near future to gain “unique experiences and memories” and “seasonal contests and surprises.” Highly optimistic, he sees Concerto as a speed bump to add 500,000 customers by the end of 2022.

“Our partners in the beginner basketball team are laying the foundation for future programs. Baseball team programs allow us to develop and deliver pre-thought application applications. For example, football field fans can leave to see the QR code of the jumbotron up to the digital wallet card they are in to use to stop deals for a second, “Duncan said.” There was a lot of excitement about what. We are doing so far, and we want to take full advantage of it. Our investment allows us to scale it up appropriately. “

Concerto, Card and Cardless competitors, have adopted similar customers purchase model with success. Cardless – which handles the creation of the program and the following card types, as well as lending, payment, and customer service – has launched programs with a number of sports organizations, including Cleveland Cavaliers, Manchester United, and Miami Marlins.

Concerto behind Cardless total capital accumulated ($ 21.2 million and $ 50 million). But Duncan says the goal is to “really boost” and ensure more partners more quickly.

“We also have a number of new features, collaborations and roadmaps, some of which will be announced in the coming weeks,” Duncan added. “Companies want to encourage and reward people to go out and do more – and people are ready. After enduring the disaster for a long time, we want to help people enjoy more and more new experiences.