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Payments startup Plastiq closed new $10 million round of funding today to enable people to pay with their credit cards anywhere.

The startup’s service essentially replaces things that require paper checks, wire transfers, money orders, or ACH (Automated Clearing House) payments with credit cards. For a small fee (between 1.89 percent and 2.89 percent of the transaction in Canada), people can use their card instead. Some banks, such as Bank of America, already offer services that mail paper checks to landlords and other merchants, but Plastiq is taking a more universal approach.

Co-founder and chief executive Eliot Buchanan told VentureBeat that he got the idea when he was in college at Harvard University (explaining the company’s Boston headquarters) and realized he couldn’t pay for his tuition with a card and had to write checks.

And although the company’s website lists tuition, taxes, utilities, and rent as examples, Buchanan says that Plastiq can really be useful for whatever payments customers have to make and traditionally cannot use a card for it.

“The most interesting to me is that customers are bringing new examples every day about where they’re using Plastiq for,” he said.

Plastiq is currently only available in Canada, but the company has been doing tests with U.S. customers, and plans to officially launch in the U.S. in late 2014. Plastiq chose to start with the Canadian market as it is quite similar to the U.S., and some of its partnerships allowed it to roll out it product more quickly in the U.S.

And while it seemed a bit odd that Plastiq is only available in the browser, though mobile-optimized of course, Buchanan said that because of the nature of the transactions people use the service for (larger, more important payments), he’s found that customers feel more comfortable using Plastiq on their desktop computers.

“The primary goal of this round is … really around talent and people,” said Buchanan. Plastiq’s team is currently at about 20 people, but it plans on growing to 30 or 40 by year’s end, and much of it will be on the support and operations team to help handle the planned U.S. launch. Plastiq also plans on relocating its headquarters from Boston to San Francisco by the end of the year.

Khosla Ventures led the round, with additional participation from previous investors Atlas Venture and Flybridge Capital Partners. Khosla partner Ben Ling will join the board of directors, while partner Keith Rabois will join as an advisor to the company.

Plastiq was founded by Daniel J. Choi and Eliot Buchanan, who met at Harvard’s Innovation Lab. Plastiq previously raised $6 million as its second institutional round of funding, and this new round brings Plastiq’s total funding to $18.35 million to date.


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