Interview with Payvment: Funding, Facebook Credits, and a Business Model Built Around Discovery

Yesterday, Facebook Page ecommerce storefront tab application developer Payvment announced it had closed a $6 million round of Series B funding. The round, led by Sierra Ventures and joined by BlueRun Ventures will be used to hire additional engineering, customer support, marketing, and product integration personnel. We spoke with chief executive Christian Taylor about why Payvment has been so successful, the potential for using Credits as a payment method, and plans for a revenue model based around discovery.

Josh Constine: How fast is Payvement growing?

Christian Taylor: We’re adding more than 250 retailers and roughly 10,000-20,000 products daily. We recently passed the 40,000 retailers mark. Setting up a store is a completely automated process. The main goal when we started Payvment was to make it dead simple for anyone to use, even if you don’t have technical knowledge.

What’s causing this growth?

The driving feature helping adoption is that when you launch a store, your products are available via search from any other Payvment storefront. We’re building the graph of shopping where one store is connected to another. If one store doesn’t carry what you’re looking for, you can jump to the next.  The technology that makes us different is a persistent shopping cart that follows you across stores so you don’t have to checkout separately from each. Other companies are trying to build a Facebook shopping cart, but each store they launch is a walled garden.

So the shopping cart saves your added items even if you log out and log back into Facebook?

Yes. And if your website has Facebook Connect, you can copy and paste code into it so a customer can add an item on your site and it will appear in their cart on Facebook.

Payvment recently released an API allowing websites to sync their product database with their Facebook storefront. How has that been received?

Good. For larger brands, if you have 500,000 products, you’re never going to add them all manually. We released a CSV importer which lots of brands are using to import their databases. There’s a REST API for CMS ecommerce platforms, so when a brand adds a product to its database, it’s automatically added to their Facebook store. Also, there’s a sales API, so instead of being emailed information about who to ship items to, you can bring that info directly into your shipping system.

How do you measure success of a Payvment storefront?

We’re seeing brands and retailers doing different things with the store. Some brands want all their products on their storefront so they’re available in search.

One measure of success is generating new Facebook Likes. A core feature is that your storefront connects to your Page’s Like Button, and you can offer a discount to anyone who Likes your Page. Instead of dumping 500,000 products on your store front, some brands offer just a few items but with deep discounts, sometimes up to 80-90% off, for Liking their Page. There’s so much value in that Facebook Like. Similar to traditional ecommerce, where if you can get someone to purchase once, they become a lifetime customer you can communicate with, Facebook is a marketing tool and a great way to acquire new customers.

What’s your conversion rate for people browsing a storefront?

It’s about more than just browsing, with Facebook its about sharing. That can’t be mimicked anywhere else. We’re trying to push users to share when they haven’t found something that they want to purchase but which a friend might. One unique thing we’ve found is younger users using search to find odd ball products, like a humorous t-shirt and sharing it to their news feed like a free virtual gift, but that goes a step further since it links back to the store. We’re looking to somehow build more gaming into Payvment.

People are taking shopping on Facebook seriously. On Black Friday, sales increased by 3x, and 4x on Cyber Monday.