Solavei today is unveiling a new $49 per month unlimited voice, data and text service that runs on the back of T-Mobile’s 4G network.
But that’s not the interesting, or controversial, part of the story.
This is: Users who sign up for Solavei actually become the company’s marketing and sales department, earning money for each new customer they recruit. Recruiting three new customers, dubbed a “Trio,” earns users $20 per month. Three trios, or nine new customer additions, equates to $49 (or the cost of one’s monthly service).
Solavei, which is heavily funded and just today announced in a SEC filing that it reeled in $6 million, is starting with a bang. The company says that more than 25,000 people have already enrolled in the program, one that’s not without its skeptics.
Perhaps no story on GeekWire in recent months has drawn as much attention as Solavei, a company led by former Motricity CEO Ryan Wuerch and former Congressman Rick White.
Critics, who’ve debated the merits of the company’s business model at length, suggest that Solavei amounts to nothing more than a pyramid scheme. Others note that the company faces an uphill climb in providing cellular service where many Americans are already locked into long-term contracts or family plans.
In an interview with GeekWire in July, White said that the company plans to follow the rules associated with multilevel marketing programs.
“You’ve got a new era coming here where the whole phenomenon of social networking is making the idea of people-to-people marketing a lot different, and a lot more exciting than it used to be,” said White who represented Washington’s 1st Congressional District before going on to serve as CEO of the technology lobbying group Technet. “If you are a multilevel marketer, there are some rules you have to follow and … we will follow all of those rules that apply to us. We really think we are doing something just a little different.”
And Solavei thinks that it can help people earn real money, not just pay back their cell phone bills. In marketing materials shown to members earlier this year, the company said that members who signed on 2,000 Trios — 6,000 customers — could make $20,000 per month.
In today’s release, Wuerch said that Solavei is looking to bring the power of social networking to one’s cell phone service.
“Today’s connected consumers depend on their mobile phones but struggle with the cost of current mobile service offers in the market,” said Wuerch, who founded the company after publicly-traded Motricity fell on hard times. “Solavei developed a comprehensive social commerce platform with the tools and resources to leverage the power of relationships using existing social networks to make mobile service more affordable – and even profitable – for our members.”
Solavei has raised cash from some high-profile investors, including Jonathan Miller, the chief digital officer at News Corp. and former CEO of AOL; David Limp, vice president of Kindle at Amazon.com; and Gary Adams, an oil & gas executive from Oklahoma. Total funding now stands at $15 million. Solavei now employs 250 full-time employees and contractors.
Full press release here:
BELLEVUE, Wash. (Sept. 21, 2012) – SolaveiTM, a first-of-its kind social networking and commerce platform, today launched its unlimited 4G nationwide voice, text and data mobile phone service with more than 25,000 new members, unlocking consumers’ earning potential through an affordable, contract-free service that pays people back for adding new customers. Solavei’s business model is shifting the billions of dollars that the large wireless carriers spend in advertising to benefit the greatest advertising vehicle today – people.
The debut of Solavei’s flat $49 unlimited mobile phone plan addresses Americans’ struggle for affordable wireless service, as recently highlighted in the findings of a new survey1 conducted by independent market research firm Toluna. Results showed a majority of consumers (63 percent) had concerns about their mobile phone service, led by overall high cost and followed by hidden fees, plan changes, and charges for exceeding data limits.
Answering the demand for a simple and affordable mobile phone solution, Solavei created a comprehensive mobile virtual network operator (MVNO) to offer an unlimited service plan to its members at just $49 per month. Consumers have the flexibility to use any compatible unlocked GSM mobile phone, or purchase a new HTC One S, HTC Wildfire or ZTE Origin from Solavei. In addition, consumers can now earn income when they share the mobile phone service with their friends and family through Solavei’s social commerce community, which is integrated into the leading social networks.
“Today’s connected consumers depend on their mobile phones but struggle with the cost of current mobile service offers in the market,” said Ryan Wuerch, founder and CEO of Solavei. “Solavei developed a comprehensive social commerce platform with the tools and resources to leverage the power of relationships using existing social networks to make mobile service more affordable – and even profitable – for our members. In three weeks of Beta testing, we’ve enrolled more than 25,000 new members and demonstrated the breadth and scalability of our systems.”
Solavei empowers consumers to earn a recurring monthly income for an action most Americans already take – suggesting favorite products or services to friends and family. In fact, nearly all consumers (93 percent) have referred a product or service. Consumers have the opportunity to earn by sharing their mobile service experience with others through Solavei’s integrated social networking platform.
“Solavei has a unique approach to how it is working with consumers, not treating them as a commodity, but as part of the team,’’ said Roger Entner, founder and lead analyst of Recon Analytics. “As a pioneer in the social commerce market, Solavei has an appealing solution for consumers to earn recurring monthly income.’’
How Solavei Works
Beginning today, consumers can go to Solavei.com to check coverage in their area, explore phone options and sign up for service. Through Solavei’s social commerce platform and mobile application, members can share the Solavei Mobile Service experience with others and generate income. At its simplest, members can earn $20 per month for every three mobile-service members (called a “Trio”) they or someone directly connected to them signs up for mobile service. When members enroll three Trios, the income generated is greater than their monthly plan cost of $49, essentially making their mobile service free and profitable. Members can continue to increase their recurring monthly income as they use their social networks to sign up more people for Solavei Mobile Service, turning their mobile phones into income.
Solavei Fits the Needs of Consumers
Wuerch founded Solavei in recognition of two significant shifts in consumer behavior: social networking and a desire to find new methods of earning income. With regard to consumer lifestyles, Solavei is meeting consumers where they are in this challenging economy. This is validated in the Solavei/Toluna survey results:
- Necessity of Mobile Phones – Wireless phone access is so important to Americans that just 4 percent of consumers surveyed said they would cut their phone service when finances are tight, ranking it ahead of gas, savings and cable TV.
- Seeking Financial Stability – Most consumers would re-invest any money saved/earned from mobile phone service back into their finances with more than a third (37 percent) putting money towards other bills, 28 percent towards savings and 13 percent toward paying off debts.
- Consumers Want to Recruit – Solavei’s compensation plan seems to make sense (and cents) to those surveyed, as a majority (80 percent) would say “yes” or “maybe” to sharing a new wireless service with friends and family members if they would get free mobile phone service or earn additional income.
Solavei is a social networking and commerce platform that enables users to connect, share and capitalize on the power of social networks. Solavei’s mission is to make commerce less expensive by empowering individuals to earn income on the products and services they enjoy and use every day. Solavei’s initial product offering is affordable, no contract, unlimited voice, text and data services throughout the United States launching with more than 25,000 members. It operates as a MVNO through a strategic partnership with T-Mobile USA. Solavei is led by former Fortune 100 telecom and retail executives and advisors. For more information, visit Solavei.com. For the brand’s latest news and updates, find Solavei on social media at Facebook.com/Solavei and Twitter.com/Solavei.