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Cardlytics ($CDLX): Future Possibilities

For all my notes on CDLX, check out my Qualitative and Quantitative “Research Notes”:

My vision for Cardlytics' future and how engagement, ARPU, ad spend, and total value can increase.

This was first published on Substack and discussed on YouTube on 9.3.2021. Republishing on my website as a backup.

Cardlytics ($CDLX): Future Possibilities

General Update (Other Investing Ideas)

I’ve been analyzing quite a few new companies with similar characteristics to companies I understand and think highly of. I have drafted some write-ups on these new companies, mostly as a way for me to organize my notes and thoughts. Although I enjoy publishing new content regularly, I will continue to hold off from posting these new ideas at this time.

Compared to Cardlytics, which I have spent a considerable amount of time learning about, these other companies are relatively new to me, and I know less in comparison. However, I find the companies and the process exciting, and I will continue to research. At some point, I plan to release.

For now, I will continue focusing on Cardlytics, due to both finding/learning new and interesting information, as well as enjoying the process due to how cheap the company trades in relation to future potential.

Cardlytics’ Value/Price remains unmatched to other opportunities, including the new ideas I am looking into. As the Value/Price becomes more even to other opportunities, and as my level of understanding becomes more equivalent, I may change both my investment allocations, and level of discussions.

Introduction and Purpose of this Write-Up

It may be hard for some to believe, based on my more optimistic views in relation to most regarding Cardlytics, but I believe I have been underestimating or not giving enough consideration to what Cardlytics could do in the future.

I've been so focused on the possibilities with Dosh and the neobanks / fintechs, that I haven't spent enough time on product / SKU level offers and the existing bank partners.

Given how I am always fascinated by ideas and visions for Cardlytics shared by others, I thought I would share some of my own.

I started keeping a running thread on Twitter, regarding ideas and possibilities for Cardlytics, and what this could physically look like over the next several years. Some of the ideas are very small, others are much grander.

Many of the ideas could prove to be impossible, already in use, or simply unnecessary. However, I will mention all of them in case any can lead to something practical and implemented. For instance, one idea in this write-up went from being my least favorite, to favorite, after spending more time thinking about it. Therefore, maybe this will happen with others.

This write-up will focus on clarifying my ideas that I have posted up to #14. If the list of ideas grows significantly, I may end up writing additional versions of this topic.

In addition, the purpose of this write-up is to:

  • Help investors realize what is possible with Cardlytics, and why valuations discussed in the previous write-up and video are possible.

  • Give Cardlytics ideas of what could be implemented. I think very highly of management, and have continually been impressed by their updates / acquisitions, etc. I simply want to jot down ideas and explain them, in case even just one single idea could be new or leads to thinking of something in a different light.

  • Give advertisers / banks new ideas or increase understanding of what is possible within this channel.

I am attempting to mention ideas that have either never been discussed, rarely discussed, are not currently in the works, or give more detail / different perspective on what has been mentioned or currently being worked on. Essentially, I’m attempting to not repeat what everyone has already considered.

Some of my favorite discussion points are:

  • Card-Linked Loyalty

  • Suggestions

  • Badge Notifications

Ideas for Higher Engagement and ARPU

As engagement increases within the banks’ mobile apps, it will lead to:

  • Higher engagement and lower attrition of bank customers

  • More use of specific cards for that bank when redeeming offers

  • More spent at retailers from the associated offer and customer conversion

  • More money saved by MAUs

  • More money earned by Cardlytics

Engagement and utilization of offers should increase as more users adopt mobile banking from previously only desktop (or no digital use at all), improved user interface (UI), more offers and more relevant offers from self-service, etc. This will also lead to higher ARPU.

However, I want to focus on some ideas that have not been discussed fully.

Cardlytics can increase engagement and ARPU by adding:

  • Aggregation of Offers (All, Travel, Loyalty Systems/Apps and Card-Linked Loyalty)

  • Formal Individual Suggestions (Single SKU, Entire Cart, Restaurants)

  • Additional Notifications (Badge Notifications and One Notification)

Aggregation of Offers

Aggregation of All Offers

An interesting thought is how this offer section within your mobile banking app could become the number one place to go shopping or visit before shopping.

A simplistic comparison could be to offer sites like Groupon. However, there are major differences, where Cardlytics is better:

  • Personalized offers based on transactional data (not being shown every single offer available, like on Groupon)

  • Ability for more relevant offers, such as specific CPG offers at larger retailers like Target or Walmart

  • More trust with banks

  • No need to download a second app to gain customers / users. All already have access via their bank apps

This vision is more easily seen on the new user experience, with categories, “store fronts”, and simply offers from everywhere.

Cardlytics $CDLX new user experience and new user interface (UI)

This aggregation of all offers from different stores into one single app increases the amount of time spent within the bank app, and time looking at offers, since the user only needs to go to one place to view all offers (not all the different websites to find the best deal, and then default to not looking, and buy based on habit or what they always buy). Instead of having a Target app to look for the best deals, a Walmart app, etc., it may be better for everyone to have all offers from these stores in one location. I understand those stores will still have their own app. My suggestion is having a “store front” within the bank app for offers only.

One specific reason this works better than only having offers shown on individual store’s website, in-store, or on their own app, is if I’m not already a customer, I will never see those offers.

Combine this with the ability to buy SKU level items with the app (discussed more later) and you have a marketplace of offers. Cardlytics already has a search function. It would work well to search specific SKU items to find the best deal.

Aggregation of Travel Deals

For the same reason aggregation works for all offers, Cardlytics should add the aggregation of travel offers to the banks and neobanks.

In terms of travel, my wife and I enjoy using Dosh to book hotels. We have received over $100 in cash back over the last year. I believe the reason we default to Dosh (beyond subconscious bias of wanting to help out a company we have an interest in), is due to the aggregation of hotels in one place, that we associate with being at a lower rate than on aggregation sites where it simply lists everything.

Not many users likely have, or will, download Dosh. It is an extra step and has friction. Therefore, to get more utilization of this nice travel feature and setup, Cardlytics should integrate the Dosh travel section with the banks and neobanks. Given these users already have their mobile app downloaded for the bank, it allows them to book travel arrangements without downloading a second app (such as Dosh, but even other booking apps).

Beyond increasing engagement from more users spending time in the app looking at travel deals, more word of mouth spread from telling others they booked through Dosh / Bank offers section, there presumably would be higher transaction amounts with higher ad spend and consumer incentives, leading to higher Average Revenue Per User (ARPU).

Quick summary of why this is better for users than other travel websites:

  • Aggregation of only travel deals, not simply all travel options available.

  • Level of trust, since booking within the bank, rather than an unknown or lesser-known website.

  • Less friction. Already have the bank app downloaded to quickly book. No additional apps needed.

Aggregation of Loyalty Systems/Apps

Based on my experience with loyalty programs, I am less receptive to their push notifications / emails. Most go to spam anyways. When you have tons of emails and push notifications come through daily, they get lost in the noise.

However, if you aggregate those offers from a single trusted source, that doesn’t go ignored (your bank), then it may be much more beneficial for companies to continue to use Cardlytics to send offers (rather than from their own system. In addition, this offer section could even add the loyalty system within the bank app.

Essentially, the more receptive behavior and less friction from having a central source within the user’s bank account may provide higher engagement and utilization than from owning the distribution network such as a loyalty app.

Some examples of what could be added even in terms of just offers.

  • Without SKU: “50% off your 10th order of $10 or more”

  • With SKU: “Buy 9 lattes get the 10th free”

This may be possible and beneficial to show points within the app, by users logging in to their loyalty program, or entering their loyalty ID.

For instance, if you had 10% off Starbucks, and had the loyalty system added, it may show the drink is actually completely free. Even more likely the customer makes the purchase. Also, if the goal is customer conversion to be added the loyalty system, showing 0 points would let the user know they are not a part of the program and could sign up to the loyalty program right from the bank app.

This becomes a central location for all loyalty systems, aggregating them in one spot. No long would you need to have tons of different apps or require a customer to download your app to benefit from the being in the loyalty program and receive offers.

Banks would also benefit since creates loyalty / stickiness / usage of bank app.

Card-Linked Loyalty

The one other idea that I had that seems extremely beneficial to many, is adopting Card-Linked Loyalty. Cardlytics should have everything set up. All you would need is the ability to enter a loyalty ID in the bank app, such as within the “store front”. This should be possible, since Chase has a place to enter your hotel loyalty before checking out when booking through their portal.

Benefits include:

  • Earning loyalty points without having to mess with logging in or giving a phone number to a retailer to receive points.

  • One and done for tracking loyalty and spend.

  • Creates a level of stickiness for keeping with that bank, since you would have logged into many different loyalty systems, and have all your points and information stored in one spot.

Decide Where to Eat

The aggregation of food offers is similar to using DoorDash to decide where to eat. Currently, there is not enough offers to use Cardlytics for this function, but I believe this will change.

I already look at the Cardlytics offers to decide where to eat. If I'm feeling pizza, I might as well save 20% and order Pizza Hut with their offer than pay full price somewhere else. Funny enough, it may be cheaper to order full price elsewhere, but the feeling of “getting a deal” and “saving money” leads to me using the offer over purchasing elsewhere.

Suggestions: “Knowing What You Want to Buy Before You Do”

Although this seems extremely simple, I believe Cardlytics can know what you want to buy before you do, better than anyone else. This is a function of having historical transaction data across many retailers, restaurants, and more.

Netflix has a suggestions spot. They have explained they can suggest the perfect show based on your history and their data. However, they are limited to less information compared to Cardlytics. Netflix has comparably less data, since shows and movies are larger in length and therefore lower frequency than payment transactions and SKU level detail. In addition, Netflix is limited to their streaming data. That is similar to Amazon and their suggestions and being limited to their stores data. Cardlytics data expands to all stores where the customer is shopping. It would be like Netflix having also Hulu, Amazon Prime, HBO, etc…and then being able to suggest from all that data and all those shows.

Another reason suggestions based on purchase data and the offer pool is important, is due to requiring less time in the app, but still have equally high usage of the card and ARPU. If I can open my app once a week, see all the best suggested offers, and order right then and there, I don’t need to spend forever in the app if I don’t want to. Cardlytics can test this out if this leads to lower overall ARPU and engagement (since no longer searching through all the offers as much), but maybe suggestions are only used for users who they cannot get to look through the offers, and increase ARPU on lower engaged users.

This is a big point, as many compare to Facebook and say how will Cardlytics ever reach their level with opening a bank app infrequently, and only being within the app for very little time. The difference is on other social media and digital ads, the ads are unsolicited. You need high frequent usage and long periods of usage to have a higher probability of conversion with an unwanted ad. With Cardlytics and offers, the user only sees them because they want to. It is solicited. You could have higher ARPU on Cardlytics than Facebook with a tiny fraction of the usage of the app, since it may require only 1 minute for the user to open the bank app, see suggestions of offers, and purchase them and be done.

Suggestions on What to Buy (Single Item)

My wife regularly uses Target Circle to see their item / SKU level offers and uses it to decide what to buy.

Since Cardlytics has transaction data and timing between purchases, Cardlytics could suggest toiletries or food before purchase. “You bought toothpaste 2 months ago. Although you usually buy every 2.5 months, there is a deal at Walmart on a similar Colgate brand. Would you like to buy this now?”

Cardlytics could add an offer section based on previously purchased items. “You bought this soap last month, and now it is 15% off, would you like to stock up?”

Cardlytics could also add an offer section of similar items to what was previously purchased. “You bought this soap last month, and now a very similar one is 15% off, would you like to stock up?” (I will discuss later purchasing SKU within the app).

Important: This plays on reasoning respecting tendency, or even justification tendency. Instead of simply seeing an offer for 15% off, if someone is telling me that I haven’t bought it in a while, and likely should now that there is a deal, I’m more likely to purchase it. Otherwise, I will wait until I run out, and then default to buying what I always buy.

Suggestions on What to Buy (Entire Shopping Cart Across Multiple Stores)

If you combine the idea with buying from within the bank app from multiple stores, Cardlytics could have a suggested shopping cart, of the best deals on toiletries, to save you the most money, and shift your spend before you spend.

There could even be a subscription based way of doing so, since they know exactly what you buy regularly and when. Cardlytics could increase use of this feature by showing how much customers are saving from doing this.

Suggestions on Where to Eat

I already mentioned using the app to get ideas or decide where to eat, due to the aggregation of offers.

However, there could be a spot within the restaurants that is suggestions from Cardlytics. The featured section would be based on premium pricing, while suggestions would be generated by Cardlytics to match up an offer that is closest to purchase history or saves the most money and is still similar to where you have previously eaten.

This could also be a function of timebound offers. If there is an offer from 4-6pm hidden among may offers, maybe that is higher in the suggestions during that exact time.

Cardlytics could even add a rating system for suggestions. I don’t think you want to add Yelp reviews to the offers, since it deters from redeeming offers at low rated restaurants. I’m also not sure you want to say exactly how many people are redeeming any given number. It would create social proof for some common places like Starbucks, but if you saw 50% off a place and no one was using it, maybe it would deter individuals.

Therefore, I wonder if you could have an internal rating of the offer. It could be based on how good this offer is in relation to other offers in the category, and maybe how good the offer is in relation to its history of offers.


Badge Notifications

Cardlytics could work with the banks and add badge app notification.

By allowing Cardlytics offers to be included with badge notifications for bank apps, users will check their apps wondering if there is a larger issue. This will lead to more attention while looking at the offers (in case its a bank related issue), and it will also get the user within the app to clear the notification increasing probability of usage (compared to getting a push notification and simply clearing it, and not entering the app).

Banks already use badge notifications for offers, such as new credit card sign up bonuses. Currently, they do not have many things to notify a user about, and therefore opening of the app and engagement is low. Given this, I see little reason for banks not to adopt adding Cardlytics offers to the badge notifications.

In total, badge notifications could be as effective as push notifications, if not more.

Cardlytics $CDLX and badge notifications with banks.

One Notification

Another thought is you likely only need one notification in order to dramatically increase engagement. One notification will make users aware of the offers. From there, they will likely check back often, as long as there are relevant offers, a lot of offers, and a good UI.

Therefore, I believe management has been wise to wait to do push notifications, or any other forms of notifications, until there it is worth notifying users. Otherwise, you risk making a bad first impression, and not being receptive to any new offers or notifications.

SKU Possibilities

SKU represents a very large portion of the total addressable advertising market. There are extremely significant benefits with using Cardlytics for SKU level offers. I believe Cardlytics will gain a substantial portion of the SKU advertising market due to their advantages.

To further capitalize on this, the following are some ideas.

  • QR codes in person that link to mobile banking app

  • Add offers on other digital ads

  • Marketplace

    • Buy SKU within the app

    • Stores within the app. Be able to purchase all at once

  • Individual pricing

QR Codes in Person That Link to Mobile Banking App

Consumer packaged goods (CPG): Products that are sold quickly and at a relatively low cost. Examples include non-durable household goods such as packaged foods, beverages, toiletries, candies, cosmetics, over-the-counter drugs, dry goods, and other consumables.1

I never realized how much better Cardlytics can be for CPG and certain SKU level products that are bought online. When an advertiser places an ad for a CPG or certain SKU offers in a digital ad platform, it has primarily been for brand awareness. The reason is due to the purchases for CPG and certain SKU items would not occur online, and therefore there is unknown performance results on those other ad platforms.

For instance, if you place an ad for Planters peanuts on Facebook, it is very unlikely a user will click on that add and order a single can of peanuts. Instead, they will purchase it in stores, where the data is unknown without underlying purchase data (which is what Cardlytics has).

Cardlytics may end up being one of the only digital advertisers to measure CPG results, given the purchases are primarily in stores (not online) and at SKU level. CPG digital ad spend is a decent percentage of total ad spend and can be captured via Bridg integration.

Cardlytics $CDLX and digital ad spend

It has already been discussed and shown where CPG level offers will be available within the offer section of the banks, as well as other SKU level items. However, what has not be considered is being able to attach Cardlytics offers to other advertisements, such as Facebook/Google/TV/Print ads.

Cardlytics could add the ability to add QR Codes with offers to TV ads, in person / print ads, etc. The other advertisements are already using QR codes to get additional info, now they could add offers to track spending and performance.

Cardlytics and QR Codes

Without the offer, advertisers will not know if the customer made an in-store purchase due to the advertisement or not. By tying a unique offer to different forms of advertisements, advertisers can track the effectiveness with certainty.

Add Offers on Other Digital Ads

Advertisers of CPG use digital ads such as Facebook to increase awareness, but results are less known, since they are for in-store purchases. This was discussed by VaynerMedia, who is using the Cardlytics self-service platform.

Given a QR Code would not work when you are viewing something on mobile, Cardlytics could add affiliate-type links. This would be similar to the Cardlytics’ links in emails to activate offers without requiring the user to open and sign in to their banking app.

Like the QR Code activation, these link activations would be in addition to the offer on the other medium, like a Facebook or Google ad. Therefore, the advertiser would have an ad to capture attention and increase brand awareness, but also have a Cardlytics offer to track if a purchase was actually made and the effectiveness of the ad.

Buy SKU within the App / “Buy it Now”

One way to maximize utilization of Cardlytics offers (not forgetting about offers and reduce time between seeing an offer and purchasing) is adding the ability to buy SKU level products with the associated offers directly within the bank app (not just add the offers to the cards).

There could be a “Buy it Now” button on each SKU level offer. This is not needed at the store level since it first requires picking out the items. However, buy it now works very well on individual items, as seen with Amazon.

For example, could add a “Buy it Now” on the item below. If they will not ship, since its a Diet Coke, it could have an option to pick it up in the store. A better example would be clothing, but I wanted to use an image directly from Cardlytics from investor day.

Cardlytics $CDLX SKU and CPG level offers in the new UI and new user experience

If it is not possible to do the complete transaction within the app, I feel it should at least be possible for Cardlytics to have SKU level offers that could be added to a store's cart within the bank, then have a link to checkout with those items on the store's website.

For instance, instead of having the “Tap to Activate” to only apply the offers, you could add a button to “Buy All Now” or “Place Order Now” from that store.

Cardlytics $CDLX SKU and CPG level offers in the new UI and new user experience

This reduces the friction of having to go to the store, find those items associated with the offer, add them to the cart, etc. This idea is only one step away from what is seen on the new UI, with individual stores that can be shopped, and the ability to add the offers to a list and activate them all at once.

Given it benefits both the bank with using their card, and the store for completing the sale, it should have a chance at being possible. Other clues for this being possible is I have Chase and Amazon linked, where I can use my Chase reward points at checkout.

The best would be having a central cart within the bank app, add SKU level items with offers from different stores to a single cart, checkout at once, and sends the order to the different stores and ships.

I feel that would work better with integration with Amazon, given that would allow having many different stores centralized via Amazon, and have one order and one shipment go out, instead of hundreds. Given new CTO has experience with Amazon, I believe something similar will at least be considered.

Individual Pricing

It has been discussed before regarding having individual pricing. The only thing I will add is we could see where there is no reason to run discounts or offers at the store level / in person. Only have the offers on Cardlytics.

The reason is to prevent giving discounts to customers who would have purchased the item regardless. Think of specific toiletries, or fast-food items. Instead of everyone getting 20% off, only offer to specific people, funded by the advertiser, and the effectiveness can be tracked. This is much easier for retailers to not have to change prices and signs regularly and can simply have someone in marketing or corporate place ads through Cardlytics and work at all stores.

Increasing Ad Spend

Beyond a shift of more advertising spend from SKU / CPG, advertising spend can grow from additional areas:

  • Self-Service within Bank and Neobanks

  • Auction-Based Pricing

  • LTV/CAC Statistics in Ad Manager

  • LTV/CAC Payment

  • Incentivize Behaviors to Optimize Business

Self-Service within Bank and Neobanks

This would lead to:

  • More testing by SMBs

  • Less friction to place an offer

  • Greater discoverability

This would be similar to Facebook, Instagram, Twitter, etc. who all have the option to place ads directly from mobile app.

A risk is it may be more likely to place “bad offers” or ads from bots. I’ve seen on Dosh’s website a list of specific requirements for an offer to be approved, so this should reduce some of this risk. Also, during investor day, it was mentioned giving banks the ability to monitor more. Here is what I had written down. From the investor day:

"The way we built the ads manager, is to allow anyone to be in the driver's seat: whether that is an advertiser, an agency, our own managed service team, or yes, indeed, a bank within the emerging services organization. So they can leverage that exact same platform to go and drive their own desires as they pertain and work with their merchants. Additionally, as I touched upon, we have created a lot of governance tools, for the banks themselves, that allow them to monitor, report, and control the program at large. So they get greater insight into how consumers are engaging, and greater insight into their ability to audit everything going through their channels, and those two things combined, mean this becomes a platform not just available for advertisers, but banks at scale too." Michael Akkerman, Chief Product & Strategy Officer, Cardlytics Investor Day Presentation
Auction-Based Pricing

This has already been generally discussed. What has not been discussed as much is how it will be implemented.

Auction-based pricing could be for placement in a featured section, to dictate order of offers, etc.

Due to different business economics and margin profiles, Cardlytics could have it separated by business type, where advertisers bid based on category.

This would allow advertisers to increase their ad spend while still making sense in relation to Lifetime Value / Customer Acquisition Cost (LTV/CAC). Cardlytics would not have to charge based on that, but if you give advertisers the ability to pay what they want, and outbid others, they may do so as long as they can see LTV/CAC and are reasonable.

LTV/CAC Statistics in Ad Manager

By focusing on Lifetime Value / Customer Acquisition Cost, rather than ROAS, ad spend could increase significantly.

Some advertisers are already thinking this way:

Cardlytics and lifetime value vs customer acquisition cost LTV/CAC

From “In Practise” Tweet

Showing advertisers estimated LTV/CAC based on pre-campaign and actual 1-year figures, it could lead to higher ad spend and understanding of channel.

This could work well with auction-based pricing, as discussed above.

Below is a sample dashboard. It shows ROAS from a single offer, CAC, and LTV based on incremental margins. It also shows what the consumer was spending before the campaign, and then after, as well as under different margins from different purchase methods or processes.

Before, the advertiser may have only focused on the ad spend of a single offer and the corresponding ROAS. However, the LTV/CAC numbers could be significantly higher.

Cardlytics and lifetime value vs customer acquisition cost LTV/CAC

Therefore, if you simply show the statistics, it may lead to advertisers testing out and spending significantly more while staying in reasonable constraints.

Below shows how on the same offer, it could make sense to spend 200x more than before. This is only to illustrate the point, and not to be exact or technical.

Cardlytics and lifetime value vs customer acquisition cost LTV/CAC

LTV/CAC Payment

Instead of advertisers paying Cardlytics based on ROAS, it could be a function of actual LTV/CAC over the last 1 year. This could be possible since they can see the actual purchases.

Given this may be looked as a royalty, and viewed less favorably than from the advertiser deciding what to pay upfront, paying based on LTV/CAC would likely work better with auction-based pricing. However, I make this suggestion, since there could be some advertisers who only want to pay based on actual results.

Incentivize Behaviors to Optimize Business

The offer below is an update that is in line with what I believe will occur over time that will lead to taking larger share of ad budgets.

Advertisers will start to focus on other benefits of Cardlytics, rather than just ROAS off a single offer.

Cardlytics to incentivize payment behaviors and optimize business.

Starbucks showed focus on customer conversion with mention of the loyalty program on their offers. Now this update with Starbucks attempting to get more purchases made in app, leading to higher efficiency in stores with less cashier usage.

I’ve discussed at length QR codes with Venmo. Not until seeing this “App Only” offer, combined with knowing the benefits of QR codes for restaurants, had I considered “QR Code Only” offers outside of Venmo, such as in the bank channel.

If restaurants want to incentivize this purchase and ordering behavior, such as ordering and paying on QR codes to have less staff or deal with staff constraints, they may be able to do so with Cardlytics.

Advertisers could then afford to pay more for ads, given the higher ad spend may be more than offset by financial benefits in certain activities:

  • QR codes to order + checkout for higher turnover & less staff

  • App payments to order + pickup for higher volume and increased efficiency

Bank Exclusive Offers

An advertiser and a bank like Chase could pay an influencer to promote product level offers exclusive to Chase. This could be within the bank on new UI. Given the ability to activate offers within email, Cardlytics could add the ability to activate offers on other platforms (discussed above with activating offers on other advertisements).

Benefits of Bank Exclusive Offers:

  • Banks increase engagement and signups (must be with that bank to get the offer)

  • Cardlytics receives increased awareness and funds less of the offers (since more funded by the banks)

  • Advertisers not only increase revenue and convert customers, but they get certainty in results driven by influencer via purchase data

  • Consumers save money on products associated with people they like

  • Influencers get paid

Exclusive offers would also be a very practical way for banks to have more unique offers and set themselves apart from other banks/neobanks who are also using Cardlytics.

Increase Total Value of Cardlytics

Create Float

It is possible that Cardlytics could create float that could be used for other activities. The way to do so would be to require a minimum amount of cash back to withdrawal. This is what occurs on Dosh. The other component would be to receive payment from advertisers before paying out to users. If an advertiser paid for redeemed offer 30 days after redemption, and the user did not hit the minimum for withdrawal for 1 year, there is essentially 11 months to use the money as you wish, at 0% interest. There would also be a portion of customers who never hit the minimum.

This idea is likely better for neobanks and would be more receptive and understood if the rewards were paid out in the form of gift cards, such as in $25 increments.

However, by delaying cash back, it may significantly decrease engagement and ongoing use, which would be a greater downside than the upside in some short-term float.


I believe ARPU / Revenue can be extremely large within just the banks.

There is no reason advertisers could not place significant amount of offers within only the bank channel. The $130B of offers mentioned in the previous write-up is possible within just the current banks.

I can vision the offer section:

  • Being the number one tool for advertisers from:

    • Certainty in results

    • Actual data on CPG and other SKU level offers

    • Most receptive advertising medium due to being solicited rather than unsolicited (placing an ad where the eyeballs are and not wanted)

  • The best tool for shoppers due to:

    • Aggregation of offers

    • Ability to shop deals from all stores in one app

    • Targeted based on actual passed purchases from all stores

    • Knowing what you want and need before you do

    • Simplifying decision making, and saving time from searching other sites

    • Save time from having to go into the stores when can order straight from the app

  • And a great way to increase engagement for banks:

    • Accelerated by adding self-service within the banks

    • Accelerated by funding exclusive bank offers


If you have any questions or push back on any of the above, please contact me. I would enjoy discussing more.

-Austin Swanson (Swany407)

Twitter: @Swany407

More Detail

I discussed this topic in more detail in the following video:

Valuations & Intrinsic Value

Thoughts Following Q2 2021 Earnings and Price Decline

Opportunities with PayPal

Best Case Scenario with Venmo

Investor Day Presentation (Includes discussions on Venmo)

I discussed Venmo Offers in detail in the Cardlytics investor day write-up and video:

Venmo Offers Valuation

I discussed Venmo Offers and valuations with additional detail in the following write-up and video:

Detailed Write-Up and Valuation

If you are looking for more detail on this company and the investment thesis, I have created a write-up, which is free to read via Substack. The write-up is formatted in bullets to more quickly skim and read sections of interest.

I also discussed the investment on YouTube.

Additional Resources and Links

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis. Please see the Disclaimer page for more details.


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