Raise Secures $18.1 Million for Gift Card Marketplace

RaiseGift card marketplace Raise has today revealed it has secured $18.1 million in funding for its platform, which allows users to buy and sell store gift cards for a discounted price. The company’s iOS app was released in October, and offers a real-time version of the full online marketplace, with support for over 3,000 featured brands.

Using Raise, consumers can transform their physical gift cards and store credits into digital cards that can be sold and sent to other users. While users may have had ways to sell their own gift cards previously, these transactions may require additional shipping charges, and, at the very least, require an overall trust that the card still contains active credit. With Raise, users are guaranteed to receive what they pay for, and at a discount, when compared to buying the card from the actual business.

After signing up for Raise, users can browse available gift cards based on featured stores, nearby stores, and more, or search the app’s database for a store of their choosing. Each card is listed alongside its current value, its sale price and its discount percentage. Users can also see whether these cards must be used in-store only, or can also be redeemed online, before they ever make a purchase.

screen1136x1136To list a card, users enter the store name and the card’s current value, and the app suggests an appropriate sale price and sale percentage. For instance, a $5 gift card may have a suggested sale price of $4.45. The seller would receive $3.78 after commission. Users must enter serial numbers, pins and so on for their cards, giving the buyer an actual, usable credit that can be used directly from within the app after they’ve bought the card.

In an ideal world, consumers would browse the app and purchase a gift card while they’re shopping in the associated store, and then use their newly acquired store credit immediately at check out.

As users earn money selling cards, they can transfer their funds to their bank account. For added security, users can create a 4-digit pin to limit access to their cards and listings in their in-app “wallet.”

This $18.1 million investment comes from Bessemer Venture Partners, and was actually made in December 2013, but remained undisclosed until today. It takes the company’s lifetime funding to $25 million. Raise has already put the funding to use, growing from 13 employees last December to 107 today. The company has experienced monthly double-digit revenue gains and 500 percent overall growth on the year so far.

The company projects the app will save shoppers $10 million during this 2014 holiday shopping season alone, with the average card or store credit selling in about four hours on the website (at a average discount of 16 percent). Raise says 96 percent of users purchase gift cards for their own use, rather than as gifts for others.

“The support of Bessemer Venture Partners has enabled tremendous growth and innovation in our marketplace, including the development of the first-ever mobile app that brings in-the-moment card exchanges right to the store counter,” said Raise founder and CEO George Bousis, in a statement. “Beyond sheer convenience, what excites us most about this app is that it provides more opportunities to make our members’ money worth more. Like the company’s name implies, Raise’s core purpose is to help both buyer and seller alike feel like they’ve gotten a raise after every transaction.”

Raise is available to download for free on the iTunes App Store.