Wrapp’s big bet on social network-powered gift cards is paying off.
The company announced today that it has raised $15 million in a second round of funding, bringing its total funding to more than $25 million. And in addition to the funding, Wrapp is seeing tremendous traction after hitting the U.S. a year ago — now America is its biggest market, displacing its home country of Sweden.
Wrapp has developed a platform that lets you give gift cards to your Facebook friends, and it allows other friends to chip into the gift card as well. Better yet, the gift cards can be redeemed via Wrapp’s iPhone and Android apps — meaning they’re always in one place, and you don’t have to worry about losing them like traditional gift cards. Since launching in Sweden in November 2011, more than 1 million Wrapp users have gifted more than 15 million cards.
The company tells me that its conversion rates for friend-to-friend product endorsements is around 18 percent, compared to conversion rates of less than 5 percent for most other media (including email, display ads, and search).
Wrapp will use the new funding to hire more people in its San Francisco office and continue its rapid expansion.
Now that it has the basic process of giving gift cards to your friends locked down, Wrapp will soon offer a new feature that will let you take advantage of exclusive offers. You’ll be able to follow brands on the service, which can offer deals to you depending on the gift cards you’ve sent out. (So if you’ve doled out tons of Gap gift cards to your friends, you may see a nice deal from Gap for yourself).
“One of the things we’ve learned is that people like giving gifts, but they also like getting stuff for themselves, that’s what started our thinking about the brand pages,” said Hjalmar Winbladh, Wrapp’s co-founder and CEO. “Since this is a marketing platform for retailers and brands, it’s a logical extension to give these retailers a way to communicate with you.”
The company says it has more than 200 retailers using its platform, most recently adding Guess, Victoria’s Secret, and Tommy Hilfiger.
This latest funding round includes participation from existing investors Greylock Partners, Atomico, and Creandum, and new investors including Qualcomm Ventures, American Express, and SEB.