Tyme Commerce

Early Stage

The Next Evolution of Point-of-Sale -- Personalized, Intuitive, Self-Service.

Analytics

Raised to Date: Raised: $136,148

Aggregate Commitments $

Platform

Wefunder

Start Date

08/31/2018

Close Date

01/31/2019

Min. Goal

$125,000

Max. Goal

$1,070,000

Min. Investment

$100

Security Type

SAFE

Funding Type

RegCF

Valuation Cap

$5,000,000

Discount Rate

15%

Rolling Commitments $

Status
Funded
Reporting Date

02/03/2019

Days Remaining
Funded
% of Min. Goal

109%

% of Max. Goal

13%

Likelihood of Max
Funded
Avg. Daily Raise

$890

# of Investors

77

Momentum
Funded
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Location

Palo Alto, California

Industry

Business Services, Software, & Applications

Tech Sector

Tyme is here to become the Amazon.com of brick and mortar commerce with their modern operating system. They provide consumers with a simple way to purchase from merchants they love, and merchants are able to create customized, personalized experiences for their consumers by speaking directly to their likes and dislikes. Tyme is also building an advanced Omnichannel architecture with crypto-tokenization to help promote brand and consumer loyalty. Plus, they’ve filed a comprehensive patent application and plan to file additional applications over time for defensive purposes.
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Analyst Report Analyst Report Methodology Article

Summary

At the time of publication, October 23, Tyme Commerce had raised $33,068 of its $125k minimum

The Tyme Commerce team has been selected as a “Deal To Watch” by KingsCrowd. This distinction is reserved for deals selected into the top 10-20% of our deal diligence funnel. If you have questions regarding our deal diligence and selection methodology please reach out to hello@kingscrowd.com

You can also see our Founder Profile with Co-Founder & CEO of Tyme Commerce, Bobby Marhamat HERE, which was performed as part of our due diligence process.

Problem

With the rise of e-commerce, local businesses are constantly being pushed to find innovative ways to make their stor efronts remain relevant amidst the rise of low cost, speedy, free shipping e-commerce retailers. Local businesses need to find ways to leverage the value of their brick and mortar locations while aligning with consumer preferences for online shopping in order to effectively compete with large e-commerce retailers.

 

The L-commerce, or local commerce (small businesses), experience as a whole right now is lacking customer personalization and lacks efficiency. Large e-commerce providers are able to present customized and interactive experiences to their customers through their deep data sets on customers, while also creating efficient transactions through things like free 2 day shipping. This customization and expedient shopping experience is still lacking in the local business segment.

 

There has been talk of Amazon trying to enter into the small business scene and helping to bridge this gap, but many small business owners have no inclination to work with a company that seems to be taking large chunks of their business away. This is where Co-Founders Bobby and Marius of Tyme Commerce saw an opportunity to fill a market gap.

 

As of now, there is no platform or company that provides an integrated commerce solution designed specifically for small businesses to manage both the online and offline shopping experience.

 

Think about how Walmart has created online ordering and in-store pickup. This seamless shopping experience is one that is growing in prevalence, driven by organizations like Walmart looking to optimize the value of their brick and mortar assets. Online shopping with in-store pickup creates unrivaled speed and efficiency to even Amazon’s 2 day free delivery service, which is one of the differentiators that brick and mortar retailers like Walmart can have at-scale over the likes of Amazon.

 

Frankly, this omni-channel (mix of in-store and e-commerce) approach is one of the big reasons that Amazon likely purchased Whole Foods. Having a fully integrative consumer experience is key to unlocking the full potential of a customer relationship.

 

Thus, the need for local businesses to capitalize on their brick and mortar asset value with an omni-channel shopping experience that looks and feels like the curbside pickup programs at Walmart is more needed than ever.

 

At the moment, there is no system in place to streamline online ordering and delivery, personalize the customer experience, and standardize loyalty programs for L-commerce. In order for local business to be able to compete against the Walmart’s and Amazon’s of the world something must change. That’s where Tyme Commerce comes into play.

Solution

Tyme aims to blend the in-store and out-of-store experience for local stores by deploying an omni-channel POS system that allows for a customer experience that is more personalized and streamlined than any L-commerce experience at the moment. Bobby is filling a gap in the market that he identified while growing point-of-sale provider Revel. The gap he identified was the lack of blending between online and offline shopping experiences in local commerce.

 

This will help local businesses in their fight against the rise of e-commerce by allowing them to become more readily able to compete with these larger corporations. Tyme is allowing consumers to shop online with a personalized interface that is specifically designed for small businesses. The team has developed an algorithm that is able to learn a customer’s tastes and then customize the ordering experience around these tastes.

This means that customers are able to order things online and pick them up at local small businesses and also enjoy a personalized online experience. Currently Tyme Commerce is positioned in a unique corner of the market because while players like Square and Revel provide strong POS hardware and software, they have not connected online and offline selling to date.

 

The team is planning to scale efficiently, by integrating its software into larger POS entities like Square and Revel that already have a dominant market share in the L-commerce POS market, an efficient distribution mechanism that should help sustain near-term growth with optimized CAC. As part of the go-to-market strategy, Bobby is also utilizing his Revel network in order to quickly find beta customers that can help to prove the validity of their solution.

Why We Like it

 

  1. Low Customer Acquisition Cost: Although the system has not yet launched, a test was conducted by the founding team in order to see what the approximate cost of acquisition for new merchants would be. The test found an average cost of acquisition of $83 for each new merchant.
  2. This low cost is made possible by Tyme’s strategy of integrating with existing POS systems. They already have lots of customer relationships, which allows Tyme to find customers with much less expenditure than if they were not integrating with these existing systems.
  3. Market Opportunity: The total available market for mobile wallets, debit cards and credit cards (the things that Tyme would extract transaction based profits from) has been estimated to be approximately $50B per year. The combination of an enormous customer base and sizable TAM put Tyme in a position where even only acquiring a slice of the market could mean substantial revenues.

    Scalability: This business has plenty of room to grow in the coming months and years. Initially it will be implemented as a plug-in to POS systems, but over time the goal is for it to grow into its own POS entity. Bobby is wisely positioning the company over the long term to lean on the value of its data in the L-Commerce market, which will provide it a long term defensive moat.

    Industry Experience: Having a founder like Bobby Marhamat is invaluable to a company like Tyme. His experience growing Revel has given him a great deal of knowledge about this market, which will aid him in building Tyme. The industry relationships and knowledge of the customer base alone are helping him to accelerate the early growth and adoption of the business.

The Terms

The team at Tyme is raising this initial seed capital to enable the initial launch of Tyme early next year in beta, which will be used to acquire customers, market their system, and continue to develop its product.

 

The team is raising at a $6M valuation cap and those that invest the first $150K will be investing at a $5M valuation cap. Looking at the current valuation in comparison to where later stage POS providers stand today in terms of valuation, we think if the team executes well, a 10X on investment is within range.

POS provider

Latest valuation / market cap

Square

$31.1B

Toast

$1.4B

Revel

$540M

Clover

$56.1M (acquisition)

The Founders

Bobby Marhamat, Co-Founder & CEO

 

Bobby Marhamat has an extensive background in building and scaling startups into profitable operations. Most recently, he was the COO for Revel Systems, a POS revenue center that grew from about $6M to $85M in his four and a half years there.

 

During his time at Revel, Bobby was close to multiple deals with large corporations such as, Shell and IBM. He also helped to expand strategic business relationships with other large companies.

 

Bobby understands this market, as evidenced by his extensive experience with Revel. He also has prior experience at multiple other startups, specifically in the tech space. He has great experience in scaling and managing tech startups, much like Tyme Commerce.

Rating

The Recommendation: Deal To Watch

 

Tyme Commerce has an opportunity to fill a market gap identified by a founding team with meaningful knowledge of the POS market. The large market size paired with the scalability of the company make it a company that has the possibility to capture a meaningful share quickly.

 

The product should drive stickiness based on its ability to enhance the customer experience in L-commerce and we like the historical success of other POS providers in the market that have neared or surpassed the billion dollar valuation. Put simply, there is a major need and demand in this space and we are still in the early innings of its development. Tyme has an opportunity to capitalize.

 

The challenge for the Tyme Commerce team will be finding ways to continue national expansion in a cost effective manner due to the challenges of selling through to local merchants. The other main challenge we see for the business is the fact that there is always the possibility that their service is blocked by one of the POS providers.

 

Though we wouldn’t expect this to occur, it could become apt to occur should they move into the hardware side of the business. For these reasons, we think the current valuation within this large market presents an intriguing investment entry point, but does come with some downside risk. For these reasons, we think it is a Deal To Watch.

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Tyme Commerce on Wefunder
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Platform: Wefunder
Security Type: SAFE
Valuation: $5,000,000

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