Business model · Commission

What are the challenges associated with Transaction Fee based business models?

Anthony Largie

May 18th, 2015

My start-up is a peer-to-peer money remittance platform. What's unique about us is we are designed to work specifically with cash remittance. Cash is still king in many developing countries. Its easy to send money as digital currency, the challenge is converting paper to digital and visa versa. Traditionally, the only options for doing that is at a bank teller or expensive remittance service like Western Union or Moneygram. Until now, we solve that problem in a peer-to-peer marketplace model. 

Seeking some expert opinions on transaction fee ( commission) based business models for tech companies. If you can share challenges you faced,comments about ideal customers, the steps to collecting revenue and the key revenue drivers.
A great idea is 1% of the work. Execution is the other 99%. In this course, we’ll teach you how to conduct market analysis, create an MVP and pivot (if needed), launch your business, survey customers, iterate your product/service based on feedback, and gain traction quickly.

Lynn Gabbay Managing Director at Queue Continuum LLC

May 19th, 2015

Anthony, my company operates something very similar to a stock exchange and collects transaction fees as the primary revenue stream. If this is along the lines of what you're interested in, reach out to me offline and we can discuss.

George Lambert Interim CTO - CTO's for Hire

May 18th, 2015

Being in the "Money Transmitter Business" comes with a great deal of potential problems. 

These rules vary from jurisdiction to jurisdiction, and there is a history of these companies being shut down, investigated, and politically oppressed.  I spent hours with the New Hampshire Banking Department discussing issues around BitCoin (which is very popular in NH) as soon as there was a conversion from or too cash it the banking department wanted to be involved - and they wanted all parties registered and licensed. 

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In the law code of the United States, a money transmitter or money transfer service is a business entity that provides money transfer services or payment instruments.[1] Money Transmitters in the US are part of a larger group of entities called Money Service Businesses or MSBs.[2] Under federal law, 18 UCS § 1960, businesses are required to register for a Money Transmitter license where their activity falls within the state definition of a money transmitter. [3]

http://en.wikipedia.org/wiki/Money_transmitter

George Lambert Interim CTO - CTO's for Hire

May 18th, 2015

Topic: Both Bitcoin-24 and Mtgox having problems in the EU  (Read 11930 times)
https://bitcointalk.org/index.php?topic=179827.0

Bitcoin investors call for legal action against MtGox 

http://www.ndtv.com/world-news/bitcoin-investors-call-for-legal-action-on-mtgox-552235

Cryptocurrency News Round-Up: MtGox Woes Continue as New York Pushes for Bitcoin Law


http://www.ibtimes.co.uk/cryptocurrency-news-round-mtgox-woes-continue-new-york-pushes-bitcoin-law-1437359

Anthony Largie

May 18th, 2015

Sure thing Sam. I have updated my description to provide some background.

Sam McAfee Building Popup Incubators for Corporate Innovation Programs

May 18th, 2015

What would help is if you can give some info on your planned business, and then folks can provide feedback. It's hard to give generic advice about a space. :)

Anthony Largie

May 18th, 2015

Yes George, I am well aware of the regulatory challenges.  Do you have any other expertise you can share?

Christophe Lassuyt co-founder at Moneytis, avoiding fees on cross-border money transfers, using Blockchain

August 11th, 2015

Hi there
Moneytis works with many MTOs and there are many solutions. One of them which is very interesting is the one of Xendpay: based on donations
According to them there are 60% of customers who give the donation suggested.
Anyway having no fees does not work, it is better to make pay % at least (you can see on reddit that % fees is not trusted, unfortunately.
Anthony feel free to contact me for further discussions on the subject

best regards
Christophe Lassuyt