At the end of the 1980s, some engineers participated in the standardization process of the cell phone network, and advocated for a removable item to support subscriber information. We all know, this participation led to the SIM card business, and more globally to the secure transactions industry as it is now.
This event has also led to a deeply rooted belief for many stakeholders in the industry: let’s be innovative, propose new products and applications and they will be adopted and repeat the SIM card miracle.
Unfortunately, a miracle happens only once! All other market segments in the secure transactions industry have faced more difficulties in the long and tedious route from the original idea to a mass market. Some of the inventions were too early, for instance, the first prototype of a reader able to display a picture contained in an ID card chip was shown in the mid-1990s and the first banking card reader developed as an extension of a mobile phone in the early 2000s. In both cases, it has taken more than a decade for the ePassport and the mPOS concepts to be fully developed and to find their market.
However, some inventors just decide to repeat a concept that has already failed! The concept of a card able to contain several card images has made a new victim! This week we learn the fall of Plastc, a Silicon Valley startup that planned to develop a new type of card that would combine information from up to 20 cards into a single support.
Plastc started in 2014 and promised to “re-invent the way you pay and re-image the traditional wallet.” The startup is said to have raised US$ 9 million (EUR 8.2 million) in preorders for its product. It has never shipped a single time before going bankrupt in April 2017.
The Plastc story is somewhat reminiscent of other startup adventures that led to an unhappy ending. Coin, more or less proposed the same concept as Plastc, it had raised US$ 17 million (EUR 15.6 million) until it was made clear that the product would never ship and the company was acquired by Fitbit or a an undisclosed sum. Stratos initially raised US$ 6.6 million (EUR 6.0 million), with the latest round in October 2015; by end of 2015, the company had shut down.
Launching new products and new concepts is not an exact science, but by building on solid expertise, access to the market and standardization, one builds more chances for survival.