The founders of cryptocurrency rewards company Trubit are close to finalizing a preseed round of funding that will allow them to launch several pilot projects.
Ian Major and Stephen Dodge have known each other since middle school and began talking last year about building a company. They started Richmond-based Trubit in February, building a platform that helps retailers, hotels and other industries offer bitcoin and NFTs as part of a loyalty program. They added Sajid Akhtar as a third founder.
“We're really trying to give brands a capability to reward their customers with simply two offers, which is bitcoin-backed instead of loyalty points or digital collectibles, NFTs,” Dodge said.
Bitcoin is the leading cryptocurrency, and NFTs are artificially scarce digital objects created using blockchain technology. Major and Dodge said one of the pilots is with a New York City gym. The owner is a big proponent of cryptocurrency and wants to offer it as part of a loyalty program, they said. The gym plans to reward members who complete an exercise program with bitcoin and lure new members to the gym with the program.
Trubit will use feedback from that pilot project and a couple others to modify and build out its platform, the founders said.
Major and Dodge did not divulge the exact amount of money they are seeking to raise, but said they are at around 85% of their goal. They have garnered funding from Virginia Venture Partners, the equity investment program of the Virginia Innovation Partnership Corp., a group of angel investors and a high-net-worth individual. All the funders are Virginia based, they said.
They noted the investment from the state-funded Virginia Venture Partners gives the company a lot of credibility and shows the VIPC’s support for cryptocurrency businesses.
Trubit is designed for both consumers and brands. Brands can build a custom landing page through the platform and begin offering bitcoin and NFT loyalty rewards. At the same time, consumers can access their rewards and move the bitcoin to another platforms.
“The opportunity for brands in this consumer segment exists and is growing extremely rapidly,” Major said. “People that like [bitcoin and NFTs] tend to skew younger, not surprisingly. Despite their youth, they tend to be higher income and tend to participate in more loyalty programs than the average consumer.”
Major said the founders want to find the best way to offer value to brands and discover the most helpful methods for engaging consumers. He said Trubit wants to start with small companies, but he can see it engaging larger brands in the new platform once it is fully developed.
Trubit is looking to move toward a software-as-a-service model, but Dodge sees the company working with brands initially on a per-project basis.
Major and Dodge admitted the cryptocurrency space is more challenging than when the company was founded. Bitcoin peaked around $65,000 in November and now trades for around a one-third of that value.
Major, however, said the decline in bitcoin is part of a longer cycle for the currency. Bitcoin went through a similar cycle a few years ago, but Major said it has always trended upward over the long term.
“People who know this space know this is a temporary event, because they have seen this story before,” Major said.
Trubit must overcome some cryptocurrency hesitancy from the public. Baby boomers have been slow to embrace it. A lot of that comes down to creating a platform that is user-friendly and gives consumers trustworthy access to bitcoin and other blockchain technology.
“We ourselves would acknowledge that there are a massive number of outright scams in the space,” Major said.
The founders are the only employees, but Trubit has worked with several contractors. The company has no revenue.
