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VentureWire - October 23, 2006
Online Rewards Start-Up Mall Networks Inks $2M Series B
By Clancy Nolan
Mall Networks Inc., a provider of software connecting online retailers with consumer reward programs, has added $2 million in venture capital financing.
New investor Venture Capital Fund of New England led the Series B round, which closed this month with participation from existing shareholders IDG Ventures Boston and LBO Enterprises. With the infusion of new cash, Mall Networks aims to bolster product development and marketing efforts.
Mall Networks has inked nearly 10 customers, including the National Association for Stock Car Auto Racing’s RacePoints’ program and Sports Loyalty Systems Inc., a consumer rewards company that works with the Los Angeles Dodgers and other major league baseball teams.
Fans typically join such rewards programs at ballparks or other venues, and choose among several options to earn points that they later redeem for prizes - anything from t-shirts to event tickets. Mall Networks creates a virtual shopping mall that those fans can then use to earn credits toward future prizes. Mall Network’s system includes 250 retailers ranging from Lands’ End Inc. to Overstock.com Inc. and Travelocity.com LP, among others. Mall Networks earns a percentage of online sales from the retailers.
Lexington, Mass.-based Mall Networks was formed last year by veteran e-commerce executive and IDG entrepreneur-in-residence Dave Andre. Andre worked alongside IDG General Partner Jeff Bussgang for three years at Upromise Inc., a site co-founded by Bussgang that enables users to dedicate a portion of purchases to college savings accounts.
As a result of the round, Carl Novotny, managing director at the Venture Capital Fund of New England, joins Bussgang, Andre and Boston Red Sox Vice Chairman Les Otten on the company’s four-member board.
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