Chirpify, which lets people initiate payments over social media, has secured another $2 million in funding and now counts rappers Lil Wayne and Snoop Dogg as clients.
Just as music stars Justin Bieber and Russell Simmons are making a name for themselves in prepaid cards, Lil Wayne (who also has a prepaid card) and Snoop Dogg are demonstrating how entertainers can boost a new payment method.
"The entertainment area, music and videos, is a great avenue for social commerce to emerge," says Arkady Fridman, senior analyst at the Aite Group.
Portland, Ore.-based, Chirpify facilitates in-stream payments on Twitter, Facebook and Instagram. Users can initiate payments replying to a tweet or posting a comment next to a Facebook or Instagram post. The company touts a 5% conversion rate and adds more than 300 users every day.
Chirpify has been successful in signing on musicians to sell digital content, including Amanda Palmer, who received 320 "buy" replies in 48 hours for a shirt she was selling on Twitter. Snoop Dogg began using Chirpify on April 23 to sell his new album, and Lil Wayne is expected to begin using Chirpify this week.
"In its initial stages the digital vertical is going to help push social commerce forward," Fridman says.
The clothing brand Puma has also signed on as a Chirpify customer, joining Adidas, Taco Bell and others.
Having such big-name customers will help Chirpify reach the wider mainstream consumer base, says Fridman.
Chirpify's Series A funding comes from Voyager Capital. Chirpify had earlier received $1.3 million in funding from voyager Capital and other angel investors, including Rudy Gadre, a former Facebook executive and Andy Lui, CEO of BuddyTV.
Chirpify says the funding will be used for marketing and sales.
This capital could also help the company combat any attempted fraud on its platform, says Fridman.
"When payments companies start seeing success, they immediately start getting attacked by fraudsters," he says. "They have to make sure they have enough funding or capital for adequate fraud protection and then to manage the losses while the company is going through the learning curve."
And this month, Twitter proactively blocked other payment services. Twitter shut down a product from Ribbon, a payments startup that allowed people to make purchases without leaving the Twitter site. And Twitter accused micropayments company Flattr of violating advertising rules, blocking its service.
Other companies, such as Dwolla, allow users to initiate transfers by typing a hashtag on Twitter.
American Express Co. also experiments with payments via Twitter, enabling consumers to sync their cards with their Twitter accounts to receive promotional offers. Amex Sync works with Twitter, Facebook, Foursquare and the Xbox game console.
The move by Amex, a large trusted company, helps validate social media payments.