Grandma’s grocery tab has gone high-tech — and I4 Commerce, a Timonium, Md.-based startup, is at the head of the curve.
The six-year-old company’s “Bill Me Later” technology, which allows consumers to buy online without giving out credit card information, is at the forefront of a movement among technology firms and retailers to give shoppers alternative methods of online payments. Instead of entering credit information online, Bill Me Later customers set up an account with I4 Commerce that they can use with any of the company’s nearly 300 online retailers, such as Wal-Mart, Overstock.com, Brookstone and US Airways. I4 then pays the retailers directly after each purchase and sends a bill to its account holders each month.
Bill Me Later “is a lot like when my grandmother shopped at the local grocery store in the 1950s. ‘Put it on my tab,’ ” said Vince Talbert, vice president of market and co-founder of I4 Commerce.
“[Many consumers] say they don’t shop online or shop less because they are uncomfortable putting their credit card information online.”
The company, which was founded by four former credit card industry executives, has used that wariness over online credit card fraud to build up a roster of nearly 2 million customers — many of them in the “soccer mom” demographic, Talbert said.
The company was recently named to Deloitte’s annual “Rising Stars” list, a ranking that looks at the fastest-growing technology startup firms in the country. The firm, which has grown its revenues by 2,744 percent since it launched, came in at No. 4 out of 25, the highest ranking for a Washington-area company.
Overall, online revenues totaled more than $175 billion in the U.S. last year — an increase of 25 percent from 2004 — and is expected to top $200 billion in 2006, according to figures from Cambridge, Mass.-based Forrester Research. The sector offering alternative online payment methods is growing. In fact, a recent study by Boston-based research firm, Celent, projected that alternative payment options will account for more than 25 percent of all online sales in the next three years.
“There’s a pent up demand for online shopping,” Talbert said. “And for a retailer that’s where all the growth is.”
