ZONG RAISES $15M IN FUNDING FROM MATRIX PARTNERS

Funding Will Be Used To Further Its Market Leadership, Expand Merchant and Carrier Networks and Continue Growth into International Markets

PALO ALTO, Calif., April 27, 2010 — Zong (www.Zong.com), the leading mobile payment service used by online gaming and social networking web sites, announced today that it has completed a $15M round of funding led by Matrix Partners. Formally a division of Echovox, Zong is now a standalone company headquartered in Palo Alto, and will use the investment to further market leadership by accelerating the growth of its merchant network in both the US and International markets and through funding the rapid expansion of its mobile carrier network.

Zong is the mobile payment provider for Facebook Credits, a new virtual currency platform being deployed across the Facebook network of over 400 million monthly active users. Zong also works with thousands of other merchants in a variety of spaces including: popular virtual worlds, online gaming, social networking and digital content properties. Zong is the only mobile payments service that combines carrier billing with credit, debit and prepaid cards allowing Zong to be the first company to allow multiple payment options via the mobile phone.

“We are thrilled to have the support and guidance of Matrix Partners, which has a phenomenal track record in developing select mobile, wireless and internet companies,” said David Marcus, founder and CEO, Zong. “With this comes the privilege of working closely with Dana Stalder, who as a result of his extensive experience with PayPal, will be of great value to our team.”

Dana Stalder, general partner of Matrix, will join Zong’s board of directors, bringing more than 20 years of experience to the company. Dana has extensive knowledge in financial services and ecommerce, having served in executive positions at Netscape, eBay and PayPal. Dana also initiated a number of other startup projects, including PayPal Mobile and the PayPal Developer Platform.

“Matrix’s message has been clear. We are committed to helping build significant, industry leading companies and Zong fits that bill,” said Dana Stalder. “Zong is at the forefront of the evolution of the payments space and we hope to play a key role in its continued growth and success.”

About Zong
ZONG is the leading mobile payment service used by online gaming and social networking sites around the world.  Its frictionless payment experience converts shoppers into buyers at rates up to 10 times greater than traditional payment methods.  ZONG leverages direct connections with mobile network operators around the world to provide consumers, merchants and publishers a secure payment solution with unrivaled connectivity and service quality.  ZONG is the mobile payment provider for Facebook Credits and also works with hundreds of leading destination sites, such as Gaia Online, IMVU and Aeria Games. Reaching over 1.5 billion mobile users, ZONG provides local payment capabilities in over 30 countries in 16 languages.  ZONG is the only mobile payment service that combines the high conversion rates of carrier billing with the low costs and flexibility of payment card networks.  ZONG is based in Palo Alto and Geneva, and is backed by Advent Venture Partners and Newbury Ventures. For more information, please visit www.zong.com.

About Matrix Partners

Matrix Partners is a premier venture capital firm that has generated outstanding returns for over three decades. The firm has delivered several of the industry’s top performing funds of all time. Matrix Partners has offices in Waltham, MA; New York, NY; Palo Alto, CA; Mumbai, India; and Beijing and Shanghai, China. The firm has been fortunate to have invested in game-changing, industry-leading businesses such as Apple Computer, Sandisk, Veritas, Sycamore Networks, Phone.com, Starent Networks

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This summer we were honored when IMVU, the leading avatar-based social network and industry pioneer, chose us to be their mobile payments partner. With over 40 million users all over the world, IMVU built their own in-house mobile payments solution. After operating their own platform for a couple years, they decided to try us on for size.

We think the fit is nice: IMVU is seeing a 50% lift in revenue after switching to ZONG. Learn all about the background and how they did it in our IMVU Case Study.

Case study, Industry News, Mobile Payments, Virtual Goods

We’ll be at the NY Games Conference this Wednesday, Sept. 30th. Hill Ferguson, our head of Product and Marketing, will be on a monetization panel discussion at 4 pm. Richard Borenstein (richard [at] zong [dot] com), our head of sales, will also be around. Send him a note if you’d like to meet up while we’re in NY from the 29th-1st. See ya there!

Industry News, Uncategorized events

Howdy. Interested in learning all about Virtual Goods and monetization strategies? Come to the ENGAGE! Expo this Wed and Thurs for a full line-up of great speakers and networking opportunities.

Use this promo code and get 15% off the ticket price for an All Access pass: VALVIP

If you’re coming to the show, be sure and checkout the monetization panel discussionat 4:00 pm on Thurs. Our Founder & CEO, David Marcus, will represent ZONG. If you’d like to arrange a meeting with a ZONG representative, just reply in the comments or shoot us an email at sales [at] zong [dot] com. Hope to see you there!

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We’ve submitted a proposal to South by Southwest (SXSW) to talk about the future of mobile payments. The good folks at SXSW liked our proposal enough to put us up for a vote, so we need your help. How can you help, you ask? Easy. Just go here and click the Thumbs Up button next to our proposal. You will need to register to vote, but that only takes about 10 seconds. Thank you for your support.

Shameless self promotion

Checkout the life story of Zong in the video below. Turn up the volume to get the full effect.

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Viva la revolucion de movil!

We’re now live in Mexico and Chile, giving you the ability to accept mobile payment from over 90 million consumers. But we’re not done yet, Papi. Stay tuned for Colombia and Brazil and also some more gems in Eastern Europe. Checkout our Coverage to see where we’re live and where we’re going.

Que les vaya bien!

coverage Coverage

We’re excited to be processing mobile payments in two more countries this month. Same as in most every other country, we have 100% mobile carrier coverage to maximize your payment conversion rates. Contact us if you want to turn on these markets for your account.

Other news: check out our May Newsletter for a smattering of Zong news, humor and other tidbits.

Mobile Payments, Zong News Coverage

We recently conducted a consumer survey to better understand our customers’ customers. As marketers, the downside to having a frictionless end user payment experience is that we don’t always know a lot about the people making the payments. How old are you? Why did you select the “Pay by mobile” option? Do you even have a bank account? These are the kinds of questions our survey was designed to answer.

Here’s what we learned, in classic “Myth vs Fact” format:

Myth - Mobile payment users are just a bunch of 12 year olds using their parent’s cell phones to make payments.
Fact - Over 88% of mobile payment users are 18 or older. The distribution skews younger with about 60% between 18 and 30 years old.

Myth - Mobile payment users only use mobile because they don’t have bank accounts or credit cards.
Fact - 76% of mobile payment users have a bank account or credit card.

Mobile payment users have plenty of options, which begs the question, “why do you use your mobile phone to pay?”

We’re glad we asked:

34% said they used mobile because “it’s fast and easy”
22% said because “it’s fun”
20% said because “i know it will work”
14% said because “it doesn’t seem like I’m spending real money”
10% said because “i don’t have a bank account or credit card”

Folks, mobile payments are becoming mainstream.
Good stuff.

Mobile Payments, Virtual Goods market research, Mobile Payments, virtual currency, virtual goods summit

Yesterday we launched coverage in Australia across all wireless carriers.  Just like in the US, Canada and Europe, we are connected with over 95% of all wireless subscribers wherever we’re live.  It’s something we think is really important.  After all, as a user, it’s a crumby experience to be led to believe you can make a payment only to find out your carrier isn’t supported.

We’re rolling out lots of new countries in the coming months.  Check out our coverage page to learn more about where we are and where we’re going.

One final note, check out our latest edition of the Zong Newsletter.  If you like it, subscribe.

Zong News Coverage, Zong News