Starbucks’ reloadable wallet is one of the coffee brand’s defining tech innovations. The digital card within the chain’s mobile app allows customers to add funds in bulk that they can use later to buy beverages. The feature makes checkout easy and gives customers a reason to visit because they’ve already paid for their next several orders.
The wallets also benefit Starbucks by putting cash directly into the chain’s pocket. At the end of fiscal 2023, there was nearly $1.6 billion sitting on Starbucks cards, according to an SEC filing.
It’s a powerful technology, and yet few restaurant chains have their own digital wallets, in part because they are difficult to implement. A tech startup called Ansa wants to change that.
Co-founded in 2022 by Sophia Goldberg, a payments expert and author of “The Field Guide to Global Payments,” and JT Cho, a former Google engineer, Ansa has developed a white-labeled digital wallet that works very much like Starbucks’. Customers can load funds onto a card via the restaurant’s app or website and then use it to pay in-store or online. Ansa also integrates with loyalty programs, so customers can earn rewards when they pay with the wallet.
Sophia Goldberg worked at payments company Adyen for more than four years before founding Ansa. | Photo courtesy of Ansa
Goldberg saw a need for the technology at concepts whose customers visit often but don’t spend much, like coffee shops. The prevailing form of payment at restaurants—swiping a credit card—comes with a transaction fee of 2% to 3%, which can take a big bite out of the margins on small orders. Industrywide, swipe fees are operators’ third-largest expense after food and labor, according to the National Restaurant Association.
Digital wallets can help ease payment costs because a restaurant is charged a transaction fee only when the customer adds money to the wallet and not when they redeem it. Plus, the restaurant gets to bank those preloaded funds, which aids cash flow. “From a financial position, a prepaid wallet is hugely impactful to a brand,” Goldberg said.
And yet adding a new payment method can be complicated. There is a whole web of integrations to consider as well as new reporting and accounting procedures. That’s where Ansa has done a considerable amount of legwork. The company started from “bare metal” to forge integrations with bedrock payment providers, resulting in a system that is “effectively tech-agnostic,” Goldberg said. That has made adding a digital wallet easier for restaurants.
Perhaps Ansa’s biggest win on the integration front has been scoring partnerships with digital payment mainstays Apple Pay and Google Pay. That will allow customers to link their Ansa-powered restaurant brand’s card and use the apps’ tap-to-pay feature at checkout. Not even Starbucks offers that functionality: To check out with the coffee giant’s digital wallet, an employee has to scan a code in the customer’s app.
Ansa’s tap-to-pay feature, called Ansa Anywhere, is launching today, and is intended to offer another layer of convenience for customers. Goldberg called it “the coolest payments product I’ll probably ever get to work on.”
And there are other perks for customers who pay with a digital wallet. Restaurants can set it up so customers get an additional $5 for every $50 they put in their wallet, earn extra reward points or get early access to new menu items. Restaurants can also customize the card with their branding and change the look to reflect the season, giving customers a sense of membership, Goldberg said.
The design of Ansa's digital cards can be changed with the seasons. | Photo courtesy of Ansa
Overall adoption of Ansa’s wallets has been strong, she said, with up to 10% of revenue coming from digital wallets at brands that are using it.
At 20-unit Compass Coffee in Washington, D.C., customers who use the digital wallet spend 26% more and visit 30% more often than regular customers who don’t use it, said CEO Michael Haft in an email. And Compass’ payment fees were down a “massive” 28% among digital wallet users compared to non-wallet users. Haft added that he expects to see another wave of adoption now that tap-to-pay is available.
Ansa’s target market is coffee shops and quick-service brands that fit its profile of habitual use, low transaction businesses, or HULT. Goldberg declined to say how many restaurant companies are working with Ansa, but said it is live across a “few hundred” locations. Restaurants pay Ansa a monthly fee per location as well as a percentage of each payment.
Ansa is based in San Francisco and has raised $19.6 million from investors including Renegade Partners, Bain Capital Ventures, Box Group, Wischoff Ventures and B37 Ventures.
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