One day Tim Baldwin was in his car waiting for the light to turn green when he saw two kids on the side of the road raising money for cancer research. Unfortunately, he didn’t have any cash on him at the time to donate to the cause, but this roadside occurrence sparked this co-founder’s idea for tip.ly, a peer-to-peer payment startup that lets you send money via click of the camera button on your phone.
Now you may be thinking, what is the benefit of sending money via photographs? To answer that question, think back to all of the times you wanted to tip someone — your bellman, valet, etc. — but didn’t have an adequate amount of cash on hand.
Tip.ly aims to fix that.
Unlike the socially-connected Venmo or Apple’s very own Apple Pay, tip.ly bipasses the hassles of sharing personal information, such as usernames and account numbers, when you’re need to pay quickly, Baldwin said.
“We decided to create an application around tipping where you could tip someone who would be underserved today by cash,” Baldwin added, such as valets, bellmen and baggage carriers.
Specifically designed to make on-the-go tipping easier, tip.ly users can send tips by simply taking a photo of the receiving service professional or everyday person with their smartphone.
Using facial recognition — also known as Face Tips — tip.ly matches the photo to the selfies stored on the recipient’s account and sends the tip amount to his or her PayPal or bank account.
Service workers who typically work at one place can pre-register a location that can be searched by the tipper with the app’s Quick Tips tool. Using Quick Tips diffuses the need to take a photo of the recipient since they can be found using tip.ly’s location-based technology.
The Scottsdale-based startup launched the app in the Apple App Store during the Money 20/20 conference in early November. While the conference helped put tip.ly in the spotlight, it is only a piece of the company’s two-part strategy for gathering early adopters, Tip.ly co-founder Stephen Campbell said.
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Tip.ly’s bottom-up strategy for grabbing early adopters includes speaking to and running tests with different businesses, such as nail and hair salons.
“We’re hyper-focused on acquiring the tipper because we feel the tipper will drive our acquisition model,” Campbell said.
To clarify, the app lets users send tips to receivers who do not yet have a tip.ly account. Simply snap a picture and send a tip, and the receiver has 14 days to create an account to claim their tips.
“One of the most compelling arguments for downloading this application is that you already have money waiting for you,” Campbell added.
To claim your tips on tip.ly, users just have to create an account and snap a few selfies. These selfies are then used to match you with your awaiting tips by using tip.ly’s facial recognition technology.
The payment transfer typically takes about two business days to complete, but for those who can’t wait to collect their tips, receivers can also scan credit cards (no swiper necessary) with the tip.ly app and let the senders select the tip amount they would like to apply.
But with large-scale hackings becoming common news nowadays, data security is more important than ever before. To protect tip.ly users against unauthorized transactions, financial data — including bank and PayPal accounts — is stored on tip.ly’s servers under 256-bit encryption.
And for those who are worried about privacy when a stranger wants to take photo of you to send you a tip, no worries. Tip.ly doesn’t allow the photos taken with tip.ly to be stored on the personal device. Instead they are sent to the tip.ly servers under the same encryption, which translates each photo into binary numbers.
“We’re really only interested in the binary numbers,” Baldwin said. “It’s an opt-in program and we don’t scan the internet for photos.”
In addition, all of the information and photos stored on the tip.ly servers will not be available to third parties, Campbell said.
Graphics courtesy of Tip.ly
