August 2, 2009 | Kim-Mai Cutler
Let the monetization begin: SocialCord has created a platform for musicians, writers and brands to build a “freemium” model delivered over Twitter or mobile phones. For example, bands wrestling with how to make a living from their music can send links to songs or videos of live performances to their most devoted fans first for a monthly charge. (”Freemium” is the business model of giving away basics for free while charging for special or advanced content.)
Users sign up by going to a special page where they enter in their phone number. SocialCord texts them a PIN, which they enter into the site and the charges appear on their monthly phone bill. No credit card numbers are necessary. Founder David Dundas says he spent nine months securing agreements with all four of the U.S.’s major mobile carriers to support payments via SocialCord without prompting users for credit card information. He developed the idea and relationships with mobile operators after serving as business development manager for Thumbplay, a ringtone and games provider that raised $6 million in March.
The carrier takes 45 percent of the user’s payment, while SocialCord splits the remainder 55 to 45 percent with the content provider. Dundas said he’ll focus initially on three markets: Facebook applications that want to charge for virtual goods or cash, musicians and special content providers (like a sommelier who has daily wine tips or a stock analyst giving minute-by-minute market analysis).
The service could be very useful if content providers can figure out exactly what people will pay for over Twitter — a problem content creators from one-man bands to institutions like The New York Times are grappling with. Dundas is betting that extraordinarily loyal music fans might opt-in or that SocialCord will work in other niche communities.
The company has two full-time employees and is looking for an angel round of funding. SocialCord’s closest competitors are TipJoy, a Y Combinator-backed company, SuperChirp, which supports payments through PayPal and Twitter direct messaging, and TwitPub. TwitPub, however, requires the content provider to have a protected account and then sells access to the entire Twitter stream. SocialCord, in contrast, sends the premium content as direct messages to the user.
Here is an example of what a SocialCord sign-up page would look like: