College Students.... No Credit Card, No Debit Card, No Problem

This Blockchain Company Just Made It Easier to Use Student IDs Off Campus

University-level college student spending in the U.S. is a nearly $80 billion business, and virtually every one of those students carries a student ID in her pocket. Today, each one of those student IDs is a missed opportunity for e-tailers and retailers--especially those retailers close to campus that cater to students' needs. Even an anecdotal show of hands in my classroom yielded a potential market. At Rutgers, home to nearly 70,000 students across its five campuses, a majority lacked access to a credit card or funded debit card, and an equal fraction said they'd want that access to make it easier to buy what they need for school, especially at off-campus stores.

New Jersey-based startup, Campus Credit, satisfies an unmet need at colleges: enabling student IDs to do more than just swipe for building access or pay for meals on campus--and local retailers are elated. The company helps traditional brick-and-mortar and online retailers inside and outside the college town ecosystem offer exclusive deals and discounts to every student through their student ID card program. “Campus Credit is a win-win for merchants and students,” says Kenneth Cucchia, the company’s co-founder and CEO. “Businesses gain direct access to students by offering exclusive deals, and those students use our platform to order (and pay for) food, products, service and more.”

The company sees an opportunity to tap into an underserved and difficult-to-reach market with a simple solution. Cucchia explained that “the way that our platform is structured, anybody with a .edu email address can use Campus Credit.”

Campus Credit’s APl allows merchants to leverage the company’s growing network of students and faculty, and is designed to cultivate better relationships in a market increasingly dominated by large corporations.

Part of Campus Credit’s strategy is to bring students to the retailers, facilitating more targeted interactions and educating them on how students spend. This becomes an ‘ah-ha’ moment, as retailers are far more likely to listen to students as potential customers. This interaction meets demand with better service offerings.

Campus Credit has incorporated its philosophy of integration with a number of student hands-on projects. Working directly with Hofstra University computer science students this Fall semester, they’ve built a platform to enable high-school students to apply for college and financial aid. The company also advises the University of Texas-Austin to help ensure students are well prepared to dive into a startup environment. Providing unique opportunities for students to gain real world experience in their field of study has always been front of mind for Cucchia, including at his first startup, Deals4Meals, an online ordering & delivery service for restaurants, which was managed almost exclusively by students at schools served by the company.

Campus Credit meets the blockchain

Campus Credit’s marketplace is being built on Ethereum’s Blockchain which serves as a platform for smart contracts for each campus’s marketplace. “Ethereum gives us the ability to give users a say over what happens to their system. We don’t own the platform-- they do,” says Cucchia. “A lot of students are not familiar with the concepts of the blockchain or cyber-currency. Campus Credit will serve as a vehicle to bring these technologies to the forefront.

One of Campus Credit’s partners, Spare, lets students withdraw cash as easily as going to an ATM machine through local merchants for a small fee. Spare compensates the merchant for distributing the cash and provide additional foot traffic for businesses. Other early adopters include LendKey, ONTRAPORT, BirdEye, and Microsoft partnered with Campus Credit to offer student loans and refinancing via Campus Capital, marketing services, reputation management, and other supporting services for merchants. Campus Credit intends to tokenize these opportunities on the blockchain to provide a seamless and more secure solution for their partner network.

Pivoting from potential to prosperity

A recent study by EPFL University found that 73% of start-ups must pivot to another market over time as their initial market did not provide the fertile ground for the product or service that the founders had hoped for. In the case of Deals4Meals, Ken Cucchia’s first startup, the company survived a gunfight with a pocket knife as a bootstrapped startup for over six years.

Throughout 2014 and 2015 there were points where Deals4Meals employed over seventy part time delivery drivers throughout Northern New Jersey and New York. Given the business model, they had accurate metrics showing that they exceeded the sales generated for over 80% of clients they shared with competitors like Grubhub, Eat24 and from 2014 to early 2016. So what happened? “In July 2016, we joined VentureOut NY’s accelerator which gave me an opportunity to pitch four investors on the last day,” said Cucchia. “3 of 4 had the same advice, but Josh Siegel of Rubicon Ventures put it to me best: “Just do the campus card payment system and keep it simple.”

“With the market becoming more cluttered each week, margins became slimmer by the day, and once payroll taxes, insurance and workers comp were factored - since we didn’t misuse form 1099 for our drivers as some competitors do even today, the model proved to be unsustainable” said Cucchia. “As much as it killed me to have to shut it down, sometimes it takes more courage to look at the landscape, know you’re beat, cut your losses and live to fight a smarter fight another day. Campus Credit, I’m happy to say was built with that mindset.”

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