How Does ibotta Make Money?
I've always been curious about what ibotta is and how does ibotta make money. So I figured out how to do it and would like to share it with you.
Ibotta is a platform that allows users to earn cashback benefits when they shop at over 1,500 different businesses. The service is offered through the company's mobile apps as well as a browser extension.
Ibotta earns money via selling aggregated and anonymized data to other businesses, as well as affiliate commissions and advertising services.
Ibotta, which was founded in 2011 and is based in Denver, has evolved to become one of the most popular cashback platforms in the United States. To far, it has paid out approximately $860 million in cashback payments.
Ibotta: What Is It and How Does It Work?
Ibotta is a program that lets customers earn cashback on their purchases. More than 1,500 brands are affiliated with the company.
Ibotta allows customers to purchase in a variety of areas, including groceries and pickup delivery, health and beauty, travel, pet supplies, entertainment, and more.
Ibotta can be utilized for both online and in-store shopping. Ibotta's mobile app or your computer can be used to make online purchases (available on Android and iOS devices).
You simply need to install the Ibotta browser extension on your PC. The cashback incentives will then be applied automatically throughout the checkout procedure.
Users just take a photo of their receipt and send it to the Ibotta app for in-store transactions. The earnings are then paid out within 24 hours.
The app even suggests local offers from brands and retailers with which it has partnered. For that, location tracking must be enabled.
Since its debut, Ibotta has refunded over $860 million in cash rewards to over 35 million users.
Ibotta's Brief History
Ibotta, based in Denver, Colorado, was started in 2011 and is still directed by Bryan Leach, the company's founder and CEO.
David Leach, Leach's father, was a car dealer in Nairobi, Kenya, where he was born. In the 1980s, the family moved to Atlanta, where his grandfather planned to start a business.
Harbinger Corporation, which pioneered concepts including electronic data interchange, became a leader in e-commerce software and network services (EDI).
Harbinger employed more than 1,000 workers at its peak. More than 40,000 active customers were served by these staff, resulting in yearly sales of more than $155 million.
Bryan has spent his summers helping out with the firm since he was a child, giving him firsthand experience with how chaotic yet wonderful startup life can be.
In 1995, Harbinger Corporation became public, and in June 2000, it was sold to Peregrine Systems. Bryan, on the other hand, has moved on to greater and better things.
He enrolled at Harvard University in 1996 to pursue a degree in Social Studies. He then went to Oxford on a two-year Marshall scholarship and graduated from Yale's elite law school with a law degree.
He had his first taste of running a business at Oxford. He started Executive Walking Tours, a company that sold walking tours in the Boston area. He was even able to hire workers who were able to conduct tours to over 1,000 people.
Leach went on to work for a few of judges after finishing his law degree, including David Souter, one of the Supreme Court justices. He joined Bartlit Beck, a Denver-based legal practice, as a partner in 2007.
He was returning from an arbitration conference in Rio de Janeiro, Brazil, one day. A woman seated next to Leach was taking a picture of her receipts for expense reimbursement on her smartphone.
This gave him an idea: what if you could do the same thing with your shopping receipts and get cashback instead? After a few months, Leach resigned from his job and went full-time with Ibotta.
In October 2012, Ibotta's website and app were finally launched. Tycho Howle (co-founder, Harbinger Corporation, NuBridges), Larry Sonsini (who took Apple and Google public; represents Google Ventures; head of top Silicon Valley legal firm), and others were among the angel investors who backed the company with $3 million in seed capital.
In addition, he was accompanied on his voyage by industry veterans. Gregory Mann (who had 20 years of experience working for Martha Stewart, Avon, and other companies), Mary Kay (former president of TSG), and Luke Swanson, a former VP of Engineering at Photobucket, are just a few of the all-stars he was able to acquire.
The company's original concentration on supermarket products was one of the reasons Leach hired a lot of retail people. Ibotta announced collaborations with retailers such as Target, Walmart, CVS, and Walgreens when it first started.
In addition, the startup was able to form partnerships with eight of the world's top ten consumer packaged goods companies. Users could then earn cashback by uploading a receipt, answering a trivia question, watching a video commercial, or sharing their purchases on social media, as well as completing a poll, learning a brand fact, watching a video ad, or viewing a video ad.
This allowed Ibotta's partners to not only encourage people to shop, but also to educate them about the business and its products.
Over the next few years, Ibotta expanded its incentive options to include new categories (such as apparel and vacation).
It also provided some important product enhancements, such as the option to check out within the app (2014) and the ability to instantly scour a merchant site for suitable cashback offers (2015).
Ibotta was the third most popular shopping app in the United States by 2017. Its app has already been downloaded over 22 million times.
In addition, the team continues to raise outside funding, raising $20 million in 2014, $40 million in 2015, and $25 million in 2017, for example. Ibotta was able to explore larger and more ambitious projects because to the monetary injection.
In 2019, it introduced 'Pay with Ibotta,' a payment method that allowed customers to pay for their full purchase using the Ibotta app. This puts them in direct rivalry with Apple Pay and Venmo, for example.
In the same year, Ibotta became a unicorn, with a $1 billion valuation following its Series D round.
Ibotta announced the development of the Ibotta browser extension a few months later, duplicating the concept that allowed Honey to sell for $4 billion on PayPal.
Despite minor hiccups (the coronavirus pandemic forced Ibotta to lay off some of its employees), the company continues to establish itself as a prominent player in the cashback rewards industry.
Ibotta has been named to the Inc. 5000 list as one of America's fastest-growing private companies for the previous three years. To date, the company has paid out over $860 million in cashback payments while employing over 600 people across five offices in the United States.
