After closing a new round of funding of $10 million, payments startup Plastiq now enables its users to swipe their credit cards anywhere. The funding was led by Khosla Ventures along with other contributors such as Atlas Ventures and Flybridge Capital partners. Ben Ling, Khosla partner will soon come aboard as one of the board of directors and partner Keith Rabois will grace the team as advisory to the company.
Plastiq had previously raised $6 million. Adding the recent funding, the total fund comes to $18.35 million.
Plastiq provides a solution or rather a service that replaces paper checks, money orders, Automated Clearing House, Wire Transfers via credit cards. It incurs a very nominal charge (something between 1.89 percent and 2.89 percent of the transactions in Canada) to let people use their credit cards. Plastiq is taking up a global approach in its services.
The idea of Plastiq dates back to the times when co-founder and chief executive Eliot Buchanan was in college at Harvard University. It was during his college days when he faced problems is paying his tuition fees via cards, and instead had to write checks. His college explains the company’s headwaters being located at Boston!
Plastiq lists payments for taxes, tuition, rents and utilities. however, Buchanan explains that people will be able to make all sorts of payments for which traditionally they cannot use cards.
“The most interesting thing to me is that customers are bringing new examples every day about where they’re using Plastiq for.” He said.
At present, Plastiq is operational in Canada only. Tests with US are on, and it might be as early as late 2014 that Plastiq will open its doors to US as well. The reason Plastiq rolled off with Canadian market is its similarity to the US market. Also the partnerships offered to Plastiq played catalyst in rolling it out in Canada quickly and easily.
What strikes one is that Plastiq is available only for browsers. Although it is optimized for mobile devices, Buchanan opined that since Plastiq takes care of payments largely and his research showed that people tend to use desktop computers for such transactions more, his users will be comfortable using Plastiq on desktops.
“The primary goal of this round is … really around talent and people“- Buchanan said. Plastiq plays host to a team of around 20 people at present. However, plans to grow the team to 20 or 40 are on the cards. Much of the team expansion will involve the boosting of operation team who will help in the US launch. Plastiq’s headquarters will also make a move to San Francisco, bidding adieu to Boston by the end of 2014.
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