Just as many small businesses have had to adapt to the conditions of the COVID-19 pandemic, a UCSB alumnus’ startup has accordingly adjusted its business plan by providing small businesses without means of processing gift cards a way to do so.
Launched in 2019 by co-founders Alec Fong and UCSB Class of 2016 graduate Nader Khalil, the startup Paneau began as an out-of-home advertising venture.
Partnering with individual Uber and Lyft drivers in the San Francisco area, Paneau equipped participating rideshare vehicles with tablets that display advertisements for local businesses to riders as the vehicles drive by the businesses. These ads include exclusive offers from the businesses, like a restaurant offering a free glass of wine at dinner, only available to customers if they take advantage of the offer on the Paneau tablet.
This interactivity makes it easier to track success through the startup’s marketing than old fashioned ad methods like billboards, for which there’s no real way to tell how many new customers it generates. Currently in San Francisco, San Diego, North Carolina, and South Carolina, Paneau is meant to bolster small businesses in whichever localities it operates.
“We built this company to really highlight local businesses,” Mr. Khalil told the News-Press. “The idea was that as you drive by different businesses, you can see those businesses on the screen and you can take action.”
As restrictions began taking hold due to the COVID-19 outbreak, Paneau saw the Uber and Lyft rides on which it depends dwindle. Also, many businesses that advertise through the company ceased their ads while they were shut down. Looking for a way to pivot business under the changed circumstances, Mr. Khalil and his colleagues found a way to do so after looking at saveourfaves.org, a Bay Area-specific website through which customers can purchase gift cards to their favorite restaurants, bars and stores to hold them over during the shutdown.
After looking through the website, the Paneau team realized that about 10,000 of the 15,000 businesses listed didn’t have gift card options. Seeing a need that required filling, the team steadily worked over the course of 10 days to create an online gift card processing platform to help the many businesses that never before had a need for selling them.
Mr. Khalil said, “Your favorite taqueria or your favorite bar, they just probably haven’t sold gift cards before. It just wasn’t part of their business, so we created an entirely digital gift card platform. The payments all happen online, we’ll immediately put the funds in the business owner’s account.”
Businesses owners who wish to sell and process gift cards through Paneau can do so free of charge by creating an account at the website paneau.io/giftcards/. They then link their bank account to Paneau using payment processing platform Stripe, which Mr. Khalil said his startup chose because it is “super secure.” After selecting dollar values for their business’ gift cards, the business owners then get a link to a customizable online dashboard that can be shared on social media. When their customers visit the link, they can purchase a gift card of their choice.
Designed for customer convenience, Paneau integrates digital gift cards purchased on the platform directly to the Apple wallet on the buyer’s smartphone. The platform is also designed for easy use by business owners, tracking the number of cards sold and the total revenue generated. With accounts easy to set up in ten minutes and its purchasing process thought out “end to end,” from payment processing to gift cards going in customers’ Apple wallets, Paneau is built around user friendliness.
Whether being used by a business owner or a consumer, Mr. Khalil said one question went into Paneau’s setup: “How is this a really simple thing for them to do?”
On top of Paneau being easy for both parties to use, the business owners won’t ever have to incur the cost of transaction fees during the health crisis, as Paneau is waiving its first $250,000 in transactions. Once this limit is passed, a small fee will be relayed to the consumer rather than to the business owner.
Constantly monitoring the COVID-19 pandemic, the Paneau team is looking for when it can reactivate its fleet of 400 Uber and Lyft drivers. Though the startup intends on resuming the service it began business with, Mr. Khalil stated the company intends on continuing its latest offering even when the health crisis abates.
“We want to dive head deep into this and really build this out… We’re excited to grow this product offering,” he said.
Paneau is software and spreads “wherever the internet takes it,” but Mr. Khalil stated that he and his colleagues are looking for it to take hold in the localities they are personally closest to. The co-founder named three California cities in which he always wanted Paneau to get a foothold. Two of them were San Francisco and San Diego, the two cities he lives between. Being a Gaucho, the third of course, was Santa Barbara.