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Visa's attempt to be the 'playville' leader: Acquires Playspan
By Eureka Bharali, SiliconIndia
San Jose: Two months back, when SiliconIndia tried reaching the virtual goods monetization platform , Playspan for a story, the company CEO hardly had time, as he was busy juggling with too many acts. His hard work has definitely paid off, as the company has achieved a decent exit, with Visa acquiring Playspan for $190 million. Since 2007, the company had raised three rounds of venture funding from leading investors in the valley and large mobile operators amounting to a total of $46 million.
The deal will enhance Visa's strength within the payment technology extending its reach to the growing virtual goods market which is expected to reach $2.1 billion only in U.S. by end of 2011. Considering, 45 percent of U.S. online spending taking place on Visa, it important that they enhance their services to capture more of this e-market. There's a big market for digital content and virtual goods thanks in part to social and mobile apps. Just look at Zynga's muti-ville application which let users buy virtual goods like "tractors", horseshoe, items for use in the game made popular by Facebook. So it's no surprise Visa is jumping in with a way for developers and publishers to accept payments for low-cost transactions. The company had earlier forayed into the area with its flagship solution 'PayClick', however, it is yet to take over Paypal.
Playspan is definitely the apt choice, considering its weed-like growth across social networks, gaming and media companies, including Facebook, Warner Bros., Nexon, Perfect World, Hello Kitty Online, Disney, Adobe, Revision3 and Nickelodeon. "Usually while making an online transaction, users gets diverted to a new webpage by the payment gateway thereby causing a disconnect in the users mind. We have observed that since lots of these purchases are impulsive, this disjoint in usage tends to make the user re-evaluate one's decision. This could lead to a loss of revenue. Our UltimatePay lightbox technology was designed to ensure that a gamer/user does not have to navigate away from the app and complete the entire transaction within the application," reveals Mehta.
The firm has come a long way, since 2006, when the main attraction of the company was the age of its Founder, Arjun Mehta, who was just 12 years old. PlaySpan started in Arjun's garage at San Jose and the initial funding came from his game challenge winnings at the 5th grade at Challenger School in San Jose. Arjun's father Karl grabbed on to his coat-tails and has been CEO of the company for the past five years. Just a game-buff teenager's ambition, today, has become the attention of the entire payment ecosystem.
