Seattle startup Tango Card has scooped up $3.3 million in venture financing, new capital that it will use to expand its rewards platform and build on its team of 26 employees.
Existing investors such as Allegro Venture Partners, Floodgate, Swan, Western Technology Investment and Google Chairman Eric Schmidt’s Innovation Endeavors participated in the round. Total financing in the 3-year-old company now stands at $9.7 million.
Tango Card has trademarked the phrase “Rewards-as-a-Service” — RaaS — to define its approach.
Businesses spend about $80 billion each year in the U.S. in recognizing and rewarding employees, clients and channel partners, but Tango Card CEO David Leeds said that system is fundamentally broken.
“We are bringing great software and APIs that makes implementing and integrating awards into modern platforms easy,” said Leeds, a former executive at FiberTower.
Tango Card has focused on four key areas: human resources, health and wellness (ShapeUp, Walkingspree), surveys (Toluna, Ipsos, etc) and loyalty programs (Bing).
“Our speciality is that you never leave that platform,” said Leeds. “You see how many credits you have, you look at the rewards that are available and you select something and confirm it, and all of that is done from within the Bing UI.”
Because users are staying within the Bing environment, Leeds said it drives significantly higher engagement.
The company also partners with leading enterprise tools such as Concur, Salesforce.com and ShapeUp.
Tango Card initially started with its own gift card offering, but the company switched gears about two years ago to move away from that part of the business.
“We see way better economics and more defensibility on what we are doing on the enterprise side,” he said.
Leeds said that the vast majority of companies prefer to offer rewards through a digital mechanism, since it allows for immediacy.
“The instant delivery that you get with digital is fantastic,” said Leeds.
Previously on GeekWire: Google’s Eric Schmidt backs gift card operator Tango Card