Big names pump $42M into Case's new venture
One of the latest ventures by former Hawai'i resident Steve Case is getting $42 million in funding from a Goldman Sachs affiliate and several former financial executives.
Revolution Money, a company launched in 2007 by Case's Revolution LLC, said it will use the funding to continue developing its two products: a credit card that charges no interchange fees and boasts enhanced security, and an online person-to-person payment service that is a way to send and receive money for free.
"In one of the toughest funding environments in history, this investment is a big endorsement of Revolution Money's business model," said Jason Hogg, chief executive officer and a founder of Revolution Money, in a press statement. He said the company's products are seen as a welcome alternative to traditional high-cost credit card companies and the PayPal online payment system.
Case, a 1976 graduate of Punahou School, co-founded AOL and served as its chairman until 2003. Among his current investments here are Grove Farm Co. on Kaua'i and a stake in Maui Land & Pineapple Co. He formed Revolution LLC in 2005 with a mission to transform market sectors by shifting power to consumers.
Revolution Money's RevolutionCard bills itself as having only a half-percent processing fee per transaction and offering up to an 80 percent savings over other credit cards. The PIN-base card also tries to insulate consumers against identity theft by bearing no personal information about the cardholder.
Revolution's MoneyExchange product enables users to exchange money for free if they register at www.RevolutionMoneyExchange.com. Users can access their online funds at the 650,000 merchant locations and 85 percent of ATMs on the RevolutionCard network.
Among the investors in the current round of Revolution Money's investments are Revolution Money Chairman Ted Leonsis, former Charles Schwab chief executive David Pottruck and former JP Morgan Vice Chairman David Golden. Citigroup Inc. and Morgan Stanley also made investments.
Previously Revolution Money obtained $50 million in an investment round in September 2007.