When word got out that Mux would raise $175 million to become a Unicorn at 1 billion valuation in 2022, there was an outcry. “Mux is a scam” or “it’s all hype” was the general consensus among the public who have not been paying attention.
The company has built its name on delivering what it says, and it has become one of the most influential brands in mobile payments, enough for Google to acquire them for 10x their then-valued worth. It may be blasphemous for people to say that Google is a Unicorn, but let’s pretend for a minute. If you built the smart phone that Google has, would you want to sell it for $125 million? I think not.
The site has been around for years (since 2011), and anyone who has used their service knows the guarantee that you won’t lose your money. But most importantly, who would want a product that doesn’t work?
Let’s be clear though, Mux is not a scam. People will always say they’re a scam or they’re not, but leave it up to people who have actually made investments to have a better understanding of what is going on. Most of the things in this article will be covered in the first three to four years of Mux’s existence, from the launch and growth stage.
To get a better understanding, let’s take a look at where Mux started from, how it’s grown and developed, and where they’re heading to before they go public. Keep in mind, the purpose of this article is more to explain what the company has done over their time with just numbers (like their valuation) rather than a detailed standard business plan.
Mux was first founded in 2011 by three young engineers who were interested in bringing mobile payments to the masses. At the time, nearly all payments companies were more focused on online brands like PayPal and developing ways to use it on a phone. Mux wanted to do something revolutionary, to give the consumer a credit card that fits into your pocket. It was a smart idea back then, but today it’s standard practice to build such a system.
In 2011, an online bank called ZestMoney partnered up with mux to build their first credit card. They sold it for about $4 a month and charges of 0.1% on all the transactions. At that time, it was as low as one could go in terms of payment processing fees. The partnership was a success and Mux was able to find more customers, who were able to use their service at thousands of stores across the country. Stores include grocery stores, gas stations, restaurants, hotels and more.
In 2012, Mux partnered up with the National Bank of Canada to launch a credit card that could only be used at a bank. They would take 1% of the value from the transactions, and didn’t have any discount on their services. The partnership worked as well, but they were more focused on servicing people in Canada than in building their brand in America.
In 2013, Mux was building and partnering up with more companies to be able to provide better services around the country. They launched a credit card called the mux card. Unlike the first two cards that were offered, Mux took just a flat 1% fee per transaction, with no sign-up costs. Even better, they would pay out any rewards to their customers up front. So if you used your card and earned cash back or points, they would automatically deposit that money into your account.
The company had taken off at this point, growing to over $100 million in transactions in less than a year. Based on these results, they raised $5.5 million from investors who saw the potential in Mux.