South African-born serial entrepreneur Vinny Lingham took to the blog of his latest venture Gyft to announce that it had been acquired by US payments giant First Data for an undisclosed amount thought to be somewhere between $50-$100 million (R534 million – R1 billion).
Gyft, a virtual gift card provider, was co-founded in 2012 by South African entrepreneurs Vinny Lingham and Mark Levitt and has previously raised anywhere from $6-$7.5 million (R64-R75 million) in funding from the likes of Google Ventures. It has an iOS and an Android app that allows users to upload, buy, send, and redeem gift cards in stores or online while keeping track of the balances of each card.
“We are thrilled because this partnership will enable Gyft to power forward in the digital gifting space,” Lingham said in his blog post. “For nearly twenty years, First Data has provided gift card programs to tens of thousands of merchants and you will soon reap the benefits of their innovation and expanded reach.”
Lingham also assured Gyft users that there would be no material change in the way that Gyft operates other than an expansion of the service to offer more than the current 200 available retailers by adding the rest of the 300 retailers that First Data has within its network of prepaid gift card clients. While the 18-person strong Gyft team will all stay on and continue working out of the company’s offices in San Francisco.
The gift card business in the US is said to be worth in the region of $100 billion (R1 trillion) which is almost as much as the total planned government spending in South Africa for the 2014/15 financial year.[Source – Pando, Ventureburn]