No more coupon clippingBriton Charles Cohen came up with the idea for online currency site beenz.com while out shopping with his wife in 1997: he got annoyed that coupons and reward cards were not interchangeable at different merchants. Wouldn't it be useful, Cohen reasoned, if you could use the points you got at one store at any other shop as well? In March 1998, Cohen - a former speechwriter for the Liberal Democrats in the United Kingdom - officially founded beenz, whose name is derived from the word "been" (as in "been there, done that"). By the end of 1999,the company had signed on nearly 400,000 members. Affiliated sites include Princeton Review, healthbuys.com, and jobsonline.com, as well as beenz licensees like Beenz Queen, which only accepts beenz as payment for its products.
Bringin' home the beenz
Each member is eligible to earn beenz at participating sites - sometimes by simply visiting the site, but more often by filling out an online survey or making a purchase. Members can keep track of their beenz with the site's downloadable "beenzcounter," and spend them at sites that have agreed to accept beenz as online currency. The company's goal is to provide a currency that can be used worldwide - 200 beenz are worth the same in China as in the U.K., but their "value" is determined by individual sites. (A compact disc, for example, could cost 2,000 beenz on one site and 4,000 on another.)
A well-publicized deal with fellow online currency site Flooz.com, completed in November 1999, allows beenz members to buy flooz with beenz - but not the other way around, since beenz can only be acquired through its member sites. The company releases beenz into online circulation for a penny each, and affiliated sites can redeem them at 1/2 a cent each. While beenz.com hopes to drive traffic to member sites - in part by providing consumers with a reward system for visiting them - the number of sites that accept beenz in exchange for goods or services is much smaller than the number that dole them out.
This ain't no hill of beenz
By November 1999, the company had completed three rounds of venture capital financing, and intends to go public in 2000. Another high-profile deal, announced in December 1999, integrated beenz into Mastercard International's Mondex brand "smart cards," which are credit or debit cards carrying a small computer chip. Now beenz can be spent at offline stores and restaurants that accept MasterCard. Beenz is also expanding its global presence: since opening its original London location in March 1998, the company has added multiple outposts in New York (now its international headquarters), offices in other American cities, as well as branches in Australia, the Far East, and throughout continental Europe.
In June 2000, Philip Letts, who had headed beenz.com since November 1998, resigned his position. His role as company president was filled by Donald McGuire, while founder Charles Cohen took over as Chairman and CEO. In spite of the management shakeup, the company has been very successful, with more than 300 partners worldwide offering the 500 million beenz (worth $2.5 million) currently in circulation. Beenz.com brings in about $3 million a month in real dollars, and is gaining 50-60 online business partners every month. Beenz.com acts as its own central bank, avoiding inflation and currency destabilization, and protecting this "ecomony" from digital counterfeiters.
