Can you put a price tag on loyalty? A new Dublin start-up certainly thinks so, having developed an app which allows customers to collect loyalty stamps from their favourite cafes, restaurants and salons around Ireland and Britain.
Squid Loyalty was founded in 2019 by Katie Farrell and Matthew Coffey, a pair of engineering graduates from University College Dublin. The company, which counts Offbeat Donuts, Umi Falafel and Java Republic among its clients, has already raised €450,000 in seed funding and is planning a string of new hires over the coming months.
Squid already employs 15 staff full=-time and is “actively growing out the British team at the moment,” said Farrell, a Dublin native.
Its app is free to download for customers and allows them to avail of loyalty stamps with participating companies, of which there are 636 so far.
Businesses who sign up to Squid are shipped a “tag” – a disk they can display at the till and which customers can scan when they’re paying for a drink, meal or other product.
“For food delivery, businesses have platforms such Deliveroo or JustEat, but for loyalty rewards many were just using paper cards, swipe barcode systems or building their own apps, which seemed unnecessary to us,” Farrell said.
“We were wondering: in five years’ time, would customers need to have 100 different apps on their phone? So we thought there was opportunity to bring it all under one roof.”
The company was quickly popular with both businesses and customers, and now has more than 60,000 members on the app.
“We noticed that there was no market leader in this space,” Farrell said. “In Ireland, in particular, there’s not much competition.”
The pandemic posed a problem for an app designed with in-store purchases at the cafe till, for example, in mind. Farrell said sales were “slower” than the company would have liked in the early months of the pandemic, though it did set up a voucher pre-purchase system as well as amping up its online marketing efforts.
As lockdown lengthened, a new phenomenon emerged: the coffee stand in the suburbs. People were seeking to get their middle-of-the-day treat to go, and Squid was there to add a loyalty incentive to the transaction.
“We got a lot of business from that, and then we were focused on the seed funding at the end of last year,” Farrell said. “So it’s been a really positive year.”
The fundraising round was co-led by Enterprise Ireland and a number of different private investors, and funded a hiring spree for a company that previously only had four staff members.
Now Squid, which is currently focused on the Irish and British markets, aims to raise €5 million in a Series A round by the end of next year to fund further growth overseas.
In the next five years, it is targeting a million users and partnerships with thousands of businesses around the world. “We want to be the leader in this space globally,” Farrell said.