Founded in 2014, blockchain technology company Colu offers the combination of a mobile payment system and a unique city cryptocurrency.
walking around the streets of Tel Aviv, it is almost impossible to miss the colorful “We accept Colu” stickers appearing on the windows of the city’s businesses and popular cafes.
Founded in 2014, blockchain technology company Colu offers the combination of a mobile payment system and a unique city cryptocurrency that is both granting financial freedom to local communities and rewarding positive social behavior.
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Chief executive and co-founder Amos Meiri’s project to change the way in which entire cities create and use money is certainly ambitious, but with a strong belief that money should be a tool for making a positive difference, Meiri has made a promising start and has ambitious plans for the future.
Colu’s mobile payment system or digital wallet, available since January 2017 through the company’s smartphone app, is currently used by more than 200,000 people in Tel Aviv, Haifa, East London and Liverpool, with users making approximately 200,000 monthly transactions across 2,000 local businesses.
The system is expanding quickly, by approximately 15% per month, and the company says its percentage of active users is more than double that of mobile payment competitors Google Pay and Apple Pay.
Earlier this month, Colu launched the pilot scheme for the second stage of their plan: City Currencies, a city-wide cryptocurrency reward scheme to incentivize positive social behavior.
Currency can be earned by recycling, volunteering, participating in civic activities, buying local produce and more, and then spent in local businesses through the Colu app.
Speaking to The Jerusalem Post at Colu’s new Tel Aviv office building, Meiri says he was inspired to launch the company while working for social trading network eToro in Cyprus during the country’s 2012-13 financial crisis and subsequent European bailout.
“The Cyprus moment was a very strong moment for me. People were standing in long lines outside banks, unable to control their own money. Money in the bank isn’t really ours,” said Meiri.
“Although it will take time to go mainstream, we’re taking baby steps towards financial freedom,” he added.
Success wasn’t immediate for Meiri and Colu co-founders David Ring and Mark Smargon who sought partners for their project, with potential investors remaining skeptical regarding the benefits of blockchain and cryptocurrency.
The team of entrepreneurs was rejected by almost 50 hopeful US East Coast supporters before early and growth stage venture capital firm SparkCapital chose to invest.
As confidence and interest in cryptocurrency has grown, Colu has successfully raised more than $40 m in funding, including significant investments from Israeli firms Aleph and IDB Development, giving Meiri and his co-workers confidence to broaden company operations.
“The end goal is that every city will have its own currency,” said Meiri. “A smart city agenda includes listening to data, wanting to react and evolve.”
To date, Colu has sought to build a grassroots bottom-up currency system within cities by working with local businesses and residents, but Meiri now plans to work with local authorities from the very start, launching the currency and incentive scheme top-down.
Its success can largely be attributed to its simplicity. The system of rewards is easy to use on the Colu app, with no need to be cryptocurrency-oriented.
Users also receive extra credit when topping up their digital wallet, giving Colu customers an incentive to continue leaving their physical wallets at home.
Having enjoyed success in four cities so far and with municipalities incentivized by the potential to boost the local economy, Colu plans to open the system in an additional two cities in Israel and two cities abroad in 2019.
Meiri is eager to ensure that the local community and positive social behavior remains at the very core of Colu even as the company expands, handing the wellbeing of cities over to its residents.
“A blockchain platform has lots of potential uses, but a community currency that can start to solve economic and social challenges has never gone mainstream,” said Meiri.
“It is difficult to help good deeds and positive behavior scale up. Colu helps partners within cities to do exactly that.”