Dwolla Raises $16.5M from Andreessen Horowitz(blog.dwolla.com) |
Dwolla Raises $16.5M from Andreessen Horowitz(blog.dwolla.com) |
I echo some of the other concerns in this thread that there just may not be an easy way to transfer money to people given all the security concerns. I still far and away would prefer to have my bank send a physical check to somebody I owe money too because at least that doesn't require them divulge sensitive information to an entity they don't know.
Also, transferring money from bank to bank or even using checks is not a fair comparison in any way, shape, or form. When you create a bank account you have to provide your social and all kinds of information too. And if you don't have an account and try to cash a check they even take your finger print and then gouge the heck out of you where they can.
You are being kind of ignorant in your gripe about how the service didn't work out well for you because it was your fault and you are comparing two incomparable scenarios.
I believed it once. Even Dwolla believed they were going to be different than PayPal, but now I'm sure they realise the reality they live in.
Criticism aside, I'm definitely rooting for Dwolla. I don't think they need to match the comparative ease offered with credit card purchases, but they need to be in the same ball park.
[1] Various established payment processors who would have you believe that if you aren't related by marriage to the CEOs of the big banks on Wall Street you will be killed.
Maybe I'm missing a killer feature, but Dwolla doesn't seem all that interesting, just another paypal competitor.
Dwolla can improve its tech stack and have it be the UX layer on top of Bitcoin if it chooses. I guarantee you there are folks at Dwolla working on this. Dwolla = front end of payment protocol. Dwolla = bank?
Competing payment protocols = Bitcoin; Bank routing/Swift + Forex. There were efforts to abstract gold into a payment protocol in the 90s but they failed.
Bitcoin or one of its numerous derivatives (feathercoin, litecoin, terracoin, ppcoin, ixcoin, novacoin, namecoin, freicoin, "govcoin") will likley win as a payment protocol.
The bitcoin investors have zero incentive to spend the money marketing it and building a sexy interface on top of it. There is money in interface.
BTW, a paypal competitor IS interesting! It's a 10bn+ market. but dwolla could be the "bank". it could be the secured storage. ....
note: andreesen has also invested in ripple/opencoin. reminds me of their simultaneous bets on dalton cadwell (immeem)'s picplz, and instagram.
Fantastic mission statement: clear, concise and it sounds almost impossible to do.
Although they didn't like my take on it when I was at a certain unmentionable payments company, it was my intuition several months ago that a price war is inevitable in this space. Whatever company initiates it will be the one that gains enough momentum from the tail to scale efficiencies best. Namely: any and all efficiencies that are "left over" after price for fellow companies in the space to compete on (great support, a beautiful API, etc.) Dwolla's aggression here shows that they understand the future of money transfer.
It seems like people really get behind startups with the biggest, craziest visions....it almost serves as a built in rallying cry.
This is still the case, and is still very much possible and active.
[1]: http://venturebeat.com/2012/03/07/tradehill-sues-suing-dwoll...
The ability to send and receive USD from Mt.Gox with Dwolla is still there (although MtGox USD codes are gone from what I've heard), and you can use Dwolla to fill up your Mt.Gox account with USD, which you can use to buy bitcoins.
If there's something I've missed, please speak up! :) I am an unverified Mt.Gox speculator so I can't use Dwolla anymore, only send and receive bitcoins as well as trade.
Bitcoin is either going to be important, or it isn't.
If it is going to be important, somebody is going to make it easy to transfer money between Bitcoin and USD, and they're going to be hugely rewarded.
Dwolla is _extremely_ well-positioned to do this in the sense that it already is an established company that has banking connections and is in a good spot regulation-wise.
The only company competing in this space right now is coinbase, but I think the part of the problem Dwolla has already solved is harder than the actual bitcoin part of the problem.
So this is Dwolla's opportunity to lose, pretty much.
Disclaimer: This is probably laughable to any company insiders because there is no way you all haven't already thought through this kind of thing (and probably found good reasons to reject it...).
If there was a way for me to pass new client onto a single sign-up process (whether I built it via an API or whether it was on Dwolla's page and tracked via referrer), that would go a long way to convincing some of them to use it.
As a developer, I attempted multiple times to get information on the FiSync APIs, as I have connections to some local financial institutions. I was thoroughly ignored despite some significant persistence.
Like all banking startups, Dwolla is just a frontend for a real bank and they can't control flow or do anything once a "real bank" operation has been handed off. Dwolla therefore sucks. It'd be nice if they used that money to become a bonafide, real banking institution.
My clients and I went back to check via parcel carrier. It was still usually at least a week faster than Dwolla.
Is something like this not possible in the US?
Electronic transfers (ACH) only take a couple of days though, and for things like payroll, once the accounts are set up it all works fine. They also work pretty well for making payments to businesses and what not.
Here are some further details on their stance:
Dwolla does not receive, hold, or transmit User funds; Dwolla only maintains and manages information associated with User ownership of the funds; (3) Veridian is the entity that provides money transmission services upon instructions issued through the Dwolla software platform; and (4) Funds in the Veridian Holding Account are held in a pooled account.
Veridian, a major investor and bank processor manages the funds. In other words, all funds withdrawn from a user’s bank to be put into their Dwolla Account is placed into the pooled Veridian Holding Account. This legal loophole allows Dwolla to operate outside the state of Iowa, since it is technically never a money transmitter, merely a service provider for a processor, and therefore not subject to the expensive registration and licensing process.
The reason is that with Dwolla / Mt Gox, I could control my purchase much better. I love ooinbase: they are a GREAT consumer service. But for large sums, I think Dwolla could have a huge win.
Dwolla possibly (probably?) does more Bitcoin business than coinbase does, and that has probably been true since before coinbase existed.
Dwolla is a money transmitter according to most (if not all) state statutes. Its relationship with Veridian does not satisfy any statutory requirement necessary for exemption. Veridian itself does not have a charter, and is not a credit union. In my personal opinion, Dwolla has been breaking laws since day one and continues to. Its investors are no different.