Yowza, a mobile coupon startup, secured $1.5 million in its first round of funding, founder Greg Grunberg (a.k.a. the actor who played Matt Parkman on NBC TV show Heroes) told VentureBeat in an interview today.
Yowza is a mobile application that lets you scan your area for stores that offer coupons or sales. To redeem a coupon, you have the cashier to scan the bar code that pops up on your mobile phone. The app, which is available on iOS and Android, only features coupons from businesses that sign up for its monthly service. Right now, Yowza only has a few thousand businesses signed up, including FastFrame, My Gym, REI, McDonalds and a variety of local merchants. However, the number of participating businesses is expected to rise significantly in the next few months, Grunberg said.
While my commitment to professionalism prevented me from asking Grunberg if JJ Abrams is giving him a cameo in the next Star Trek movie, we did chat about why Yowza didn’t need to compete with other popular coupon and deals services.
“There is room for Foursquare, ShopKick and plenty of others. Those guys are in the gaming business as far as I’m concerned, because you have to check-in, accrue points … click like buttons, etc.,” which are all activities that the average person doesn’t have time to do to obtain a coupon, Grunberg said. “My wife and I have three kids, so when we’re at a store we want to pull up a coupon and use it. That’s it.”
That said, Yowza definitely focuses on the simplicity of pointing you to coupons and allowing you to redeem them quickly. And by focusing on being a useful way to scan for coupons rather than a way to interact with my friends, it proves very successful.
Unlike group coupon deal services like Groupon, Yowza doesn’t take a cut of the revenue from each sale. Instead, merchants sign up for the service, which costs $89 per month per location. Merchants can then add or edit any number of coupons or sales that they’d like, as well as view analytics on their customers’ coupon activity. The monthly fee can be less for merchants with a chain of national or regional stores, depending on the type of business and number of locations.
Under the current business model, Yowza isn’t far off from achieving profitability, according to CEO David Teichner. And with more people using mobile devices to save money in brick-and-mortar stores, mobile coupons have a bright future.
Founded in 2009 by Grunberg and August Trometer, Yowza’s investors include Tech Coast Angels, Pasadena Angels, and others. The company has 11 employees.