If there are any non-tech businesses out there who consider themselves relatively immune to disruption by tech startups, they might need to think again. New York’s Vengo Labs, which attracted the accolade of “NYC Next Idea 2012” from the NYC Economic Development Corporation just after its launch that year, is quite the non-tech disrupter, as it happens. And most product managers would agree that a tech startup that attracts $2 million in Series A funding is persuading a lot of hard-headed people. It’s showing that it really can bridge the online and offline worlds with its little glass-fronted kiosks that fuse digital advertising with point-of-purchase vending machines.
The funding, which was announced this week, comes courtesy of some pretty impressive names from the world of investment, including Coinstar’s founder Jens Molbak, Nas and Anthony Saleh’s QueensBridge Venture Partners, Brad Feld, Kensington Capital, Joanne Wilson, Scout Ventures, Vector Media, Tony Hsieh’s Tech Fund and crowdfunding platform SeedInvest. The new cash injection follows seed-funding last year of $1million, bringing the two-year-old startup’s total investment to $3million.
Traditional product managers may seem a little surprised to find tech investors pouring funds into a vending machine manufacturer; but Vengo is taking things further, allowing brands to capitalize on their existing ad campaigns through the very mini-kiosk that’s selling their product. Vengo’s little kiosks aren’t just vending machines: they’re consumer engagement and interactive sales platforms, too.
If our traditional product manager is feeling a little puzzled as to how this might work, it’s pretty straightforward. Vengo takes a cut from the sales and from the advertising that runs across the front of the kiosks. Presently, according to co-founder Brian Shimmerlik, the startup’s revenues are made up of these two streams in equal measure.
There are about 60 Vengos scattered across NYC in venues like the IPG Media Lab, NYU, Fueled Collective, Raven and ProHealth. Between them, these locations have attracted 280,000 active consumer engagements per month.
Long term plans may involve international expansion, but more immediately the new money will be used to install Vengos in new markets. The company is working on plans to place them in a fleet of buses and in taxis, as well as developing mobile and Bitcoin payments.
As Shimmerlik puts it, “We are creating interactive retail where it never existed before.”