OneText raises $4.5M from Y Combinator, Khosla to reinvent purchasing by textual content
The standard on-line checkout expertise has develop into bloated with friction. And whereas extra corporations are constructing options round on-line checkout, few are rethinking it from scratch. One such firm is OneText, which is constructing what it calls a “text-to-buy community,” that lets buyers full purchases by way of textual content message.
The corporate, based by former PayPal staff, simply closed a $4 million seed spherical backed by Khosla Ventures, Coatue, Citi Ventures, Y Combinator, Good Associates (the fund created by the founders of Warby Parker, Allbirds, and Harry’s), and Matt Bellamy, the frontman of Muse.
Co-founder and CEO Jonathan Fudem got here up with the thought whereas engaged on the checkout workforce at PayPal. There, he noticed many upstarts with slick UX stumble over the identical go-to-market hurdle: convincing retailers to swap out their present cost flows.
“That’s a tough pitch,” Fudem stated, including that many retailers don’t even have the liberty to decide on their checkout supplier; it’s usually determined by their e-commerce platform.
Through the use of SMS, OneText doesn’t require a service provider to switch their web site’s present checkout. Whereas massive platforms like Instagram and WhatsApp even have ecommerce options, Fudem believes manufacturers nonetheless want direct, ownable relationships with their prospects.
OneText views itself as a competitor to the SMS advertising corporations identified for mass, impersonal messaging and spammy hyperlinks.
As an alternative, it makes use of a mixture of instruments — together with AI-powered two-way conversations and people within the loop — to enhance conversions by 20–30%. Options like cart restoration, post-purchase upsells, and shopper-specific suggestions contribute meaningfully to that efficiency.
Below the hood, OneText runs its personal pockets which integrates with a model’s present processor to finish transactions. OneText securely vaults a buyer’s cost data after their first buy. From then on, they will reorder with a single reply.
This “card-on-file” setup is what OneText believes makes its textual content commerce much like charging gadgets to a room throughout a resort keep.
To make that work, OneText makes use of what Fudem calls “consentful” automation. If a model needs to cost a buyer for a reorder, OneText sends a textual content saying the cost will undergo in 24 hours except the client cancels. It’s opt-out by default.
Over time, it plans to increase the community so buyers can use their vaulted profiles throughout a number of manufacturers, with pre-filled checkout information and smarter suggestions.
In that sense, the corporate is constructing towards one thing a lot bigger: a cross-brand, SMS-native cost community.
“Constructing a consumer-facing pockets that’s 10x higher is de facto onerous,” Fudem stated. “However we will create a business-to-consumer texting platform that brings the ‘cost it to your room’ expertise, solely now, it’s your telephone quantity. That’s how we’ll construct the community.”
OneText went by means of Y Combinator in 2023 and quietly constructed out its platform after Demo Day. At this time, the platform has mid-sized e-commerce manufacturers, doing $10M–$100M in annual income, as prospects, Fudem says, although it additionally helps smaller startups and enormous enterprises.
“We’ve been scaling 3x yr over yr and doing tens of millions in income,” stated Fudem, who launched the corporate with CTO Daniel Mind.