Fivestars builds software to support small-business payments and marketing, including its own payment product, integrations with point-of-sale systems, and marketing automation that delivers personalized messages. The platform also leverages a broader network of 60 million shoppers to enable cross-promotion across Fivestars merchants. During the COVID-19 pandemic the company reported record usage, with 1 million new shoppers joining the network every month. Fivestars has shifted strategy to emphasize its payments product and its network in response to merchant needs. The company has provided more than $1 million in credits and made additional products free to support customers during the crisis. Financially, the startup has raised additional capital while continuing to expand its merchant-facing tools. FiveStars provides a tablet-based platform, app, and analytics suite that enables small merchants to run loyalty programs, identify customers, and deliver discounts and targeted marketing. The product includes CRM and marketing automation, POS integrations, in-store beacons and app-based check-ins, and a tablet with software for merchants. The company reports roughly 10,000 merchant customers, 10 million consumer users, and more than 35 million store visits driven by its messages and offers in the past year. FiveStars typically charges about $300 per month for its full solution and employs a large direct sales force (about half its employees). The startup launched out of Y Combinator in 2011 and has expanded its brand and business across the U.S., with plans to eventually expand internationally (the U.K. cited as a target). FiveStars provides a customer loyalty and relationship management platform that helps small and medium-sized merchants automate loyalty programs, track purchases and customer behavior, and send targeted messages. Its premium AutoPilot product, priced at $200 per month, uses machine intelligence to detect changes in customer behavior and trigger personalized offers and retention messages. The company emphasizes return on investment for merchants, reporting typical lifts of around 20% in customer visit frequency after implementation. Launched three years ago out of Y Combinator, FiveStars reports rapid revenue growth — from zero to "high millions" in two years and tripling year over year. Operational metrics include roughly 5,300 merchant customers, over 4 million consumers signed up for its loyalty programs, more than 2.6 million rewards redeemed, and 2.5 million automated messages sent for merchants. Management says the new funding will be used to expand across the U.S. and build a broader merchant network to enable consistent personal treatment for customers everywhere they go. FiveStars offers a loyalty-card program that links directly to merchants' point-of-sale systems, removing the need for customers to install apps. The company was incubated at Y Combinator and is based in Mountain View, California. Its cards are accepted at a range of local merchants, including Subway, Round Table Pizza, Tutti Frutti and Baja Fresh. FiveStars says it has tracked more than 3.5 million items purchased by repeat customers at local merchants. CEO Victor Ho framed the product as a way for merchants to drive word-of-mouth and repeat business by modernizing traditional loyalty techniques. Financially, the company has been raising venture capital to scale its merchant integrations and user adoption.

Total raised

$142M

Funding rounds

5

Latest round

Series D

Latest activity

Oct 2020