Postscript acquires cash-back company Fondue

SMS marketing company Postscript acquired a majority stake in Fondue, a cash-back app for Shopify brands, president Alex Beller tells Axios.

Why it matters: In an industry where margins count, helping retailers increase their profitability, garner revenue and build customer loyalty is paramount.

Details: The deal was valued in the “eight figures," Beller says, declining to disclose additional financial details.

• Fondue’s co-founders will join its leadership team, and the rest of its employees will join Scottsdale, Arizona-based Postscript.
• Postscript hasn’t been historically acquisitive, Beller says and so Fondue’s case was highly opportunistic.
• Fondue was previously backed by a host of investors including Quiet Capital, Hanaco Venture Capital, Gaingels and Sugar Capital, among others.

How it works: Fondue's app incentivizes shoppers to take cash-back offers instead of discount-driven offers — which can ultimately hurt a brand’s bottom line as they’re giving up margin, Beller says.

• Most people aren’t going to redeem their cash-back offer or a large percentage may end up selecting store credit, driving repeat purchases at the retailer, he says.

Meanwhile, Postscript works with Shopify merchants to allow them to compliantly build a list of opted-in SMS subscribers and send texts to their customers around product launches and shipping updates.

• Postscript also offers two-way customer support, aiming to make SMS “the number one revenue channel for brands," Beller says.
• It launched SMS Sales earlier this year, which connects a retailer’s customers with real-life SMS sales associates to engage with them and help facilitate sales.

Catch up fast: Postscript raised $65 million in a Series C round last year led by 01 Advisors with Twilio Ventures and Expanding Capital participating.

• Postscript has raised $106.5 million to date.