November 29, 2010, 1:16 PM

Online payment service for teens wins new funding

Socialwise Inc. raises $3.4 million to expand its BillMyParents payment service.

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Socialwise Inc. closed on $3.4 million in new funding this month and says it will use the money to expand its marketing programs and acquire new customers for its BillMyParents payment service.

When teens registered with the BillMyParents service shop at participating e-retailers, they click the BillMyParents option at checkout, which then alerts parents about the pending transaction via e-mail or mobile text message. If parents approve the transaction, they enter their credit card information to complete the order. Socialwise collects a 50-cent transaction fee from parents for each purchase. Participating e-retailers include Amazon.com, No 1 in the Internet Retailer Top 500 Guide, and youth apparel retailer PacSun.com. Parents also can buy teens a prepaid and reloadable MasterCard from the service.

“This round of funding is intended to allow us to fully engage our national marketing and customer acquisition programs for our products and to quickly gain momentum in the marketplace,” says Jim Collas, president and CEO of Socialwise. The company says it will use targeted ads, pro athlete endorsements, events and sponsorships, and social media to market the service in 2011.

The new funds came from 37 investors, according to a Socialwise filing with the U.S. Securities and Exchange Commission.

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