ORCA Has Hopes Of Being E-Commerce Killer App
Short for Optimized Real-Time Currency Application, the open-source platform helps social media companies facilitate digital commerce by creating tools to process payments, manage loyalty programs, schedule advance orders of real and virtual goods, and send marketing messages.
Backed by an API architecture designed for social media communities -- managed by close partner Mashery -- ORCA is targeting social networks, online games, participation in TV shows, and other social media.
"There was nothing designed for the unique needs of this rapidly growing online segment," says Roger Wood, CEO of oneTXT.
At launch, five companies have signed on to incorporate ORCA into their payment platform, but their names will not be revealed until the fall. According to Wood, they include a social net "of note," a participation TV network, a social gaming network, an offline retailer "seeking to fragment itself" online, and an interactive digital publisher.
Wood noted that oneTXT will not be competing with PayPal on its home turf -- i.e., eBay and other standard e-commerce platforms.
The virtual goods and currency market will reach an estimated $1.8 billion this year as 12% of Americans report having bought a virtual item at some point over the last 12 months, according to a recent study by analyst firm Frank N. Magid Associates and commissioned by virtual currency provider PlaySpan.
Demographically, the market is more balanced than one might assume as 15% of males ages 12-24 reported purchasing virtual goods, while 15% of women between ages 35-44 did so, too. According to Mike Vorhaus, president of Magid Advisors, the boys are getting virtual swords for their MMORPGs, while the women are buying virtual flowers on Facebook.
Yet, the majority of micro-transactions are less than $1, and with minimum fees averaging 30 cents for credit and gift cards, a 30% revenue loss makes little sense, according to Woods.
In June, oneTXT raised $2 million in Series A funding from Metamorphic Ventures with KPG Ventures, and the New York Angels Fund, along with individual investors.
Former iVillage CTO and COO Richard Caccappolo has also recently joined the New York-based company as president and COO.
Based in San Francisco, Mashery manages APIs for over 70 companies, including The New York Times and Best Buy. Mashery is backed by First Round Capital, Formative Ventures, The Accelerator Group, .406 Ventures, and many prominent angel investors.