Unless you’ve been living under a rock you know that Snapchat launched Snapcash in the middle of last week. I’ve had some time to play around with the functionality so here’s a review:

Concept

According to Snapchat Snapcash “set out to make payments faster and more fun”. The beauty here is the entire backend is handled by Square. 

Experience

When you login to the new snapchat you are immediately prompted to agree to the new terms of service. Before you have time to worry about trusting your debit card information to a company that is barely 3 years old you are taken to a delightful screen that ensures you that Square is handling the entire transaction. On your first transaction you are hit with a pop-up that makes you confirm you want to send money.  After you  send funds a log is left in your chat with a mini-receipt of sorts. The problem is this receipt only exists for a moment in time. If you leave the conversation and then return there is no long of your funds being sent. I sent $1 to a few friends to test out the service and was concerned when my bank did not show the credit as fast as the debit. 

VORP (Value over replacement player):

Snapchat’s long standing value is its ephemerality. The ability to send a disappearing picture was one of the key attributes that drew millions of predominately teenagers to the service. The non permanent nature of snapchat doesn’t particularly transfer well to payments. When I send funds to a friend or a business I want a receipt of it. I want to know that the funds were received. Snapchat provides a receipt and log but its buried under its menu. 

Snapcash also isn’t a true P2P payment provider as it doesn’t hold a balance. When I send money via Venmo or bank transfer it is often predicated on a balance. You have no snapcash balance everything exists through square. Square handles everything including support which engenders trust for the end user.  

Future

Snapchat’s made a huge move with Snapcash. It is the first step towards monetization for one of Silicon Valley’s brightest starts. Getting the debit cards of snapchat users is HUGE. Personally I doubt we will see the explosion of Peer to Peer transactions with snapcash. Everyone I send snapchats to is inherently someone I am close with and I probably have their phone number. If I need to send them money Snapchat is the last place I will look. I do see a major opportunity in Snapcash commerce and I see it playing out in one of three ways:

1) straight commerce: Brand X says send us $Y and we’ll give you Z. I think this would work really well with music or media. 

2) exclusivity: This idea was stolen from a friend and I think there is something to it. Brand X says send us some snapcash and we will send you something exclusive or limited. 

3) charity: The thing we always said about Centscere was that it’s impossible to talk bad about a company that tries to be charitable. So as great (or terrible) as Centscere’s value proposition was we always had “we’re doing something good for the world”. That’s why I believe a brand could get a nice moment if they did something charitable with snapcash. You could do commerce with it. Ex. Have you ever been to Wendy’s and they give you a coupon booklet for a donation to their charity? Or when a non-profit gives you address labels in exchange for your donation. It’s the same thing but this time through a digital medium. So the question becomes how do you accomplish it. There has to be some sort of exchange to a) entice donors to give and b) to loop in a brand. They’d give up some very cheap asset for this (a coupon for a frosty in the example above) and get to be seen as giving back and being innovative. So then the final question is what charity does the money go towards. Well you (or the partner) could just pick it. Or you could let the audience pick it with an incentive. Pick a few charities and whichever one earns the most donations gets a matching prize. 

I’m really excited to see whats next for Snapcash and very intrigued to see what brand jumps on first. What are your thoughts? let me know in the comments.