Beenz.com
Encyclopedia
Beenz.com was a web site
that allowed consumers to earn beenz, a type of online currency
, for performing activities such as visiting a Web site, shopping online, or logging on through an Internet service provider
. The beenz e-currency
could then be spent with participating online merchants.
The marketing and brand concept positioned Beenz as ‘the web's currency,’ global money that would challenge the world’s major currencies. The Beenz management team raised almost $100 million from venture capitalists including Apax/Patrickof, Larry Ellison
of Oracle, Francois Pinault
of PPR, Vivendi Universal
, Italian financier Carlo de Benedetti and Hikari Tsushin of Japan.
Since launching a new currency is illegal in many countries, beenz management and its legal teams had to meet with finance ministers across Europe to assure them that Beenz would be categorized as virtual points. Within days of its launch in the UK, Beenz' offices in London were visited by the Financial Services Authority (FSA) on suspicion of operating an unlicensed bank (apparently the FSA misunderstood that the 'Bank of Beenz' on the website was, in fact, just a marketing name for the user account area. The company agreed to change this to 'My Beenz' and the FSA was satisfied). Beenz received several awards for its marketing campaign.
Beenz operated in the United States, Sweden
, France, Germany, Italy, Japan, Singapore, Australia and China. At its peak, there were offices in 12 countries, and translations of the beenz website into several languages.
After the dot-com bubble
burst, the company replaced its CEO, Philip Letts, with a team including the founder, Charles Cohen, and other Board directors Stephen Limpe, Don McGuire and Sean Lane. The company could not go public, further funding did not materialise, and the company was sold to US-based Carlson Marketing Group in 2001 for an undisclosed sum.
Carlson planned to integrate the beenz system into the customer relationship management
tools they offered to clients. After the sale of the company to Carlson, beenz account holders were given a period of time to redeem their beenz before it became integrated. After 9/11, Carlson's business (which was heavily reliant upon bank and airline points programmes) struggled and the beenz concept was shelved. Carlson did not renew the domain name.
In June 2008, CNET
counted Beenz among the greatest dotcom disasters.
enabling holders of the 'rewardz card' to transfer earned beenz to their credit card
account. This was one of the first relationships of its kind between a traditional finance company
and a dot-com
enterprise.
Beenz was also once aligned with the now-defunct Speedyclick.com
, which carried its own virtual currency
. Beenz could be converted into SpeedyBucks, but not vice-versa.
and joined forces with former reality television
star Neil Forrester
, who had met whilst students at Oxford University. After tossing around the idea of Beenz and trying to get it off the ground Charles joined forces with Dave King, John Hogg, and Philip Letts to take Beenz forward. They quickly divided roles - Charles would take on the tasks of website development becoming CTO, Dave was Head of Sales and Philip became CEO, John Hogg headed Marketing. Philip took on Nicolas de Santis to develop the much vaunted Beenz logo and brand vision. After an intensive period of fundraising Beenz launched with a guerilla marketing campaign designed by the crew and Nick Band of Band and Brown. John Hogg moved over and De Santis became Chief Marketing Officer. Letts led Beenz to raise nearly 100 million dollars and spearheaded the expansion worldwide. He moved head office to New York from London and brought on Philippe Cothier as European president, Mitch Feigen as US president and opened an Asian division.
Letts left Beenz after closing the last big round of over 30 million and went on to run Tradaq.com, a business-to-business exchange that allowed companies to buy and sell products and services without using cash.
De Santis left a few months after that and took on Chief Marketing Officer of Opodo.
Cohen used his experience with Beenz.com to write a book in 2002 called "Corporate Vices: What's Gone Wrong With Business" (ISBN 978-1-84112-435-3). He now runs Probability plc in the UK, a mobile gambling business that he co-founded in 2004. Before beenz Cohen worked with Thought Interactive (a web design business). Initially the concept was heavily dependent on the English speaking world and to change that the company recruited such characters as the Swedish entrepreneur Mikael Karlmark to launch its first non-English subsidiary.
There was some controversy when it transpired that the flyer distributors were specifically targeting drunk people, in an effort to make their task easier. There were many reports of people waking up after a night of drinking to find the Billy Beenz flyer mysteriously in their pocket.
. Companies purchased beenz from the company at a locally determined exchange rate. They could then award these to consumers for actions to which the issuer attached value, such as making on-line purchases. Beenz were collected by the user clicking on a Java Applet
and entering their email address linked to a beenz account. Consumers were then able to use their beenz to purchase goods from on-line merchants. Each merchant was free to exchange beenz at any notional value they liked, the company assuming that the market would settle the exchange value of each beenz. Merchants were then able to sell beenz back to the company itself at a pre-defined exchange rate. The company made its margin on the spread between the sell and the buy price of beenz in the market. In the later stages, a professional economist was employed to model the behaviour of prices and flows of money in this micro-economy, and keep it healthy.
Cohen's stated long term aim was eventually to allow consumers to purchase beenz directly from the company and for the "beenz economy" to eventually resemble that of a real economy. However, at the time, this was fraught with difficulty as some countries (such as France) expressed a view that such alternative currency schemes were undesirable and that they would seek to prevent them from operating.
Website
A website, also written as Web site, web site, or simply site, is a collection of related web pages containing images, videos or other digital assets. A website is hosted on at least one web server, accessible via a network such as the Internet or a private local area network through an Internet...
that allowed consumers to earn beenz, a type of online currency
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...
, for performing activities such as visiting a Web site, shopping online, or logging on through an Internet service provider
Internet service provider
An Internet service provider is a company that provides access to the Internet. Access ISPs directly connect customers to the Internet using copper wires, wireless or fiber-optic connections. Hosting ISPs lease server space for smaller businesses and host other people servers...
. The beenz e-currency
Electronic money
Electronic money is money or scrip that is only exchanged electronically. Typically, this involves the use of computer networks, the internet and digital stored value systems...
could then be spent with participating online merchants.
The marketing and brand concept positioned Beenz as ‘the web's currency,’ global money that would challenge the world’s major currencies. The Beenz management team raised almost $100 million from venture capitalists including Apax/Patrickof, Larry Ellison
Larry Ellison
Lawrence Joseph "Larry" Ellison is the co-founder and chief executive officer of Oracle Corporation, one of the world's leading enterprise software companies. As of 2011, he is the third wealthiest American citizen, with an estimated worth of $33 billion.- Early life :Larry Ellison was born in the...
of Oracle, Francois Pinault
François Pinault
François Pinault is a French businessman who runs the retail company PPR. He is a friend of former French President Jacques Chirac....
of PPR, Vivendi Universal
Vivendi
Vivendi SA is a French international media conglomerate with activities in music, television and film, publishing, telecommunications, the Internet, and video games. It is headquartered in Paris.- History :...
, Italian financier Carlo de Benedetti and Hikari Tsushin of Japan.
Since launching a new currency is illegal in many countries, beenz management and its legal teams had to meet with finance ministers across Europe to assure them that Beenz would be categorized as virtual points. Within days of its launch in the UK, Beenz' offices in London were visited by the Financial Services Authority (FSA) on suspicion of operating an unlicensed bank (apparently the FSA misunderstood that the 'Bank of Beenz' on the website was, in fact, just a marketing name for the user account area. The company agreed to change this to 'My Beenz' and the FSA was satisfied). Beenz received several awards for its marketing campaign.
Beenz operated in the United States, Sweden
Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....
, France, Germany, Italy, Japan, Singapore, Australia and China. At its peak, there were offices in 12 countries, and translations of the beenz website into several languages.
After the dot-com bubble
Dot-com bubble
The dot-com bubble was a speculative bubble covering roughly 1995–2000 during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the more...
burst, the company replaced its CEO, Philip Letts, with a team including the founder, Charles Cohen, and other Board directors Stephen Limpe, Don McGuire and Sean Lane. The company could not go public, further funding did not materialise, and the company was sold to US-based Carlson Marketing Group in 2001 for an undisclosed sum.
Carlson planned to integrate the beenz system into the customer relationship management
Customer relationship management
Customer relationship management is a widely implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing,...
tools they offered to clients. After the sale of the company to Carlson, beenz account holders were given a period of time to redeem their beenz before it became integrated. After 9/11, Carlson's business (which was heavily reliant upon bank and airline points programmes) struggled and the beenz concept was shelved. Carlson did not renew the domain name.
In June 2008, CNET
CNET.com
CNET is a tech media website that publishes news articles, blogs, and podcasts on technology and consumer electronics. Originally founded in 1994 by Halsey Minor and Shelby Bonnie, it was the flagship brand of CNET Networks and became a brand of CBS Interactive through CNET Networks' acquisition...
counted Beenz among the greatest dotcom disasters.
Partnerships
Amongst the company's partnerships was one with MasterCardMasterCard
Mastercard Incorporated or MasterCard Worldwide is an American multinational financial services corporation with its headquarters in the MasterCard International Global Headquarters, Purchase, Harrison, New York, United States...
enabling holders of the 'rewardz card' to transfer earned beenz to their credit card
Credit card
A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services...
account. This was one of the first relationships of its kind between a traditional finance company
Financial institution
In financial economics, a financial institution is an institution that provides financial services for its clients or members. Probably the most important financial service provided by financial institutions is acting as financial intermediaries...
and a dot-com
.com
The domain name com is a generic top-level domain in the Domain Name System of the Internet. Its name is derived from commercial, indicating its original intended purpose for domains registered by commercial organizations...
enterprise.
Beenz was also once aligned with the now-defunct Speedyclick.com
Speedyclick.com
SpeedyClick.com was an entertainment-based website operating out of Glendale, CA circa 1998 – 2001. The site featured contests, original content, and free web-style games such as blackjack, bingo, and virtual slot machines...
, which carried its own virtual currency
Virtual currency
Virtual currency is used to purchase virtual goods within a variety of online communities; which include social networking websites, virtual worlds and online gaming sites....
. Beenz could be converted into SpeedyBucks, but not vice-versa.
Founders
The inventor of Beenz was Charles Cohen, from the UK. He co-founded the parent companyHolding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
and joined forces with former reality television
Reality television
Reality television is a genre of television programming that presents purportedly unscripted dramatic or humorous situations, documents actual events, and usually features ordinary people instead of professional actors, sometimes in a contest or other situation where a prize is awarded...
star Neil Forrester
Neil Forrester
Neil A. Forrester is a British research assistant in the field of developmental disorders and language acquisition at the University of London. He is best known to the general public as one of the cast members of the fourth season of the MTV reality television series The Real World: London, which...
, who had met whilst students at Oxford University. After tossing around the idea of Beenz and trying to get it off the ground Charles joined forces with Dave King, John Hogg, and Philip Letts to take Beenz forward. They quickly divided roles - Charles would take on the tasks of website development becoming CTO, Dave was Head of Sales and Philip became CEO, John Hogg headed Marketing. Philip took on Nicolas de Santis to develop the much vaunted Beenz logo and brand vision. After an intensive period of fundraising Beenz launched with a guerilla marketing campaign designed by the crew and Nick Band of Band and Brown. John Hogg moved over and De Santis became Chief Marketing Officer. Letts led Beenz to raise nearly 100 million dollars and spearheaded the expansion worldwide. He moved head office to New York from London and brought on Philippe Cothier as European president, Mitch Feigen as US president and opened an Asian division.
Letts left Beenz after closing the last big round of over 30 million and went on to run Tradaq.com, a business-to-business exchange that allowed companies to buy and sell products and services without using cash.
De Santis left a few months after that and took on Chief Marketing Officer of Opodo.
Cohen used his experience with Beenz.com to write a book in 2002 called "Corporate Vices: What's Gone Wrong With Business" (ISBN 978-1-84112-435-3). He now runs Probability plc in the UK, a mobile gambling business that he co-founded in 2004. Before beenz Cohen worked with Thought Interactive (a web design business). Initially the concept was heavily dependent on the English speaking world and to change that the company recruited such characters as the Swedish entrepreneur Mikael Karlmark to launch its first non-English subsidiary.
Marketing Campaign
The company used an innovative guerilla marketing campaign to get the word out in the early days. Instead of distributing a flyer in the conventional way, the company hired magicians and sleight-of-hand experts to slip the flyers surreptitiously into the pockets of members of the public. The flyers depicted "Billy Beenz", the fictional company mascot. Billy had a shock of red hair and a goofy expression.There was some controversy when it transpired that the flyer distributors were specifically targeting drunk people, in an effort to make their task easier. There were many reports of people waking up after a night of drinking to find the Billy Beenz flyer mysteriously in their pocket.
Business model
The beenz business model was based upon arbitrageArbitrage
In economics and finance, arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices...
. Companies purchased beenz from the company at a locally determined exchange rate. They could then award these to consumers for actions to which the issuer attached value, such as making on-line purchases. Beenz were collected by the user clicking on a Java Applet
Java applet
A Java applet is an applet delivered to users in the form of Java bytecode. Java applets can run in a Web browser using a Java Virtual Machine , or in Sun's AppletViewer, a stand-alone tool for testing applets...
and entering their email address linked to a beenz account. Consumers were then able to use their beenz to purchase goods from on-line merchants. Each merchant was free to exchange beenz at any notional value they liked, the company assuming that the market would settle the exchange value of each beenz. Merchants were then able to sell beenz back to the company itself at a pre-defined exchange rate. The company made its margin on the spread between the sell and the buy price of beenz in the market. In the later stages, a professional economist was employed to model the behaviour of prices and flows of money in this micro-economy, and keep it healthy.
Cohen's stated long term aim was eventually to allow consumers to purchase beenz directly from the company and for the "beenz economy" to eventually resemble that of a real economy. However, at the time, this was fraught with difficulty as some countries (such as France) expressed a view that such alternative currency schemes were undesirable and that they would seek to prevent them from operating.