More than a company

We believe PassPass is so much more than a company. It is a movement. With over 1,000 businesses and 900+ affiliates joining in the first 60 days, it is clear, we are fighting a battle worth every ounce of our sweat.

The Vital Role of Small Businesses in Our Communities

I believe small businesses are more than just the backbone of the local economy; they are the heart and soul of our communities. They provide unique products and services, create jobs, and foster economic diversity. When small businesses thrive, they increase the vibrancy of their neighborhoods, contribute to local causes, and help maintain a robust community identity. However, when these businesses close, the effects are palpable. Job opportunities diminish, local economies suffer, and communities lose their unique charm and character. I have personally driven down streets in cities where businesses have closed and have watched as the communities around them have deteriorated.

The Consequences of Small Business Closures

The closure of small businesses leads to a loss of diversity in the marketplace, making communities more homogenous and less attractive to both residents and visitors. Practically, and economically, the closure of these businesses lead to decreased local tax revenues, which fund essential services such as schools, public safety, and infrastructure maintenance. Socially, the loss of small businesses erodes the social fabric of communities, as these are often places where people gather, share ideas, and support each other. Again, this benefits no-one.

The problem with today's Marketplaces

I believe there is a fundamental problem that exists in today's marketplaces. They are decidedly heavy handed and one sided toward the lane of the consumer. While this may seem like the right thing to do, it is actually a self fulfilling prophecy that leads to the decline of the experience and vibrance of the business to consumer eco-system. If the marketplaces that connect businesses and consumers are too heavily weighted to the consumers, then they risk losing the businesses that make the marketplace a consumer destination, in addition, those that stay, end up providing poor levels of service and quality of products because the economics to serve do not equal a prosperous business to consumer relationship. I believe a more fair approach at scale will lead to a healthier relationship and a more sustainable future for small businesses and the consumers who patron them.

The problem with today's investment landscape

It is no secret, the majority of investment in todays startup landscape, and for the last few years, as well as at scale companies in the fortune 500 and the big 7 (Microsoft, Nvidia, Alphabet, Apple, Meta, Amazon and Tesla) are going towards Artificial Intelligence. These investments like many, when new technological paradigms come forward (Internet, Mobile), will have a few winners and many losers. But the bigger problem I see, is in a world where AI threatens to make human's obsolete in many knowledge work type roles, the physical world is at no peril to fall by the wayside, yet, most of the invesment in the physical world is done by Government agencies or Real Estate businesses and developers. While space and infrastructure is important, there is an entire class of service businesses that is highly neglected by capital allocaters, primarily because their businesses models do not show a high value ratio when it comes to traditional investing and they are very difficult to extract return on invested capital. However, this does not change the fact, that people still need to eat. People still need to breath clean air, connect, travel, experience, live, clothe themselves, etc. these are all experiences in the physical world. Thus, businesses that serve humans and what ever physical beings exit in the future, will still have a vital role in the economy for decades, and perhaps longer to come. Yet it is these business, the ones that lack the capital and demand to stay in business, that are the ones that are most in peril. How often do you see a Fortune 500 company go belly-up? For small businesses, it is 65% every 10 years according to the SBA. Small businesses represent $5.9 Trillion in GDP, providing jobs to 65 million people, yet, they are the most susceptible to disruption or going out of business. The services are critical, yet not valuable. They are seen as commodities. And the only way to drive return significant return commodities is at great scale and consolidation.

But what if there was a new paradigm that shifted the power structure and gave every small business the opportunity to own a piece of a high value technology business, adjacent to their core business. What if we could co-op millions of businesses together to create a digital marketplace with 100's of millions of subscribers, where the businesses in the co-op were able to claim a share of the subscription revenue as their own, highly profitable and adjacent to their core business, without canabalizing it?

Introducing the Digital Co-Op Marketplace: A New Paradigm

To combat these challenges and reinvent the relationship between businesses and consumers, we at PassPass have invented a new model. We are calling it a Digital Co-Op Marketplace. It is a 3 sided marketplace that connects businesses, members and affiliates together, to provide a subscription membership service to a broad audience, while sharing in the subscription revenues on a pro-rata basis, based on the performance and efforts of each business in the marketplace. This innovative platform redefines how businesses and consumers interact by removing intermediaries, thereby eliminating middleman fees. It directly connects consumers with businesses, fostering a community where savings and earnings are mutually shared, and prosperity is a collective goal.

A Shift Away from Deep Discounts

The era of expecting steep discounts—40%, 50%, or even 60%—is fading. These discounts often reflect manipulative pricing strategies rather than a fair exchange of value especially in the case of acquiring a "new customer". Instead, the future lies in modest discounts across a wide array of purchases, incorporating loyalty into the purchasing process. I like to call this, and would like to coin this method, known as "Micro-saving," allows consumers to save small amounts across multiple retailers. Though these savings might appear minimal individually, they accumulate significantly over time, benefiting both consumers and businesses alike.

The Benefits of a Co-Op Model in the Digital Age

This digital co-op model mirrors the win-win nature of traditional cooperatives, adapted for the digital age. It is superior for businesses as it ensures better cash flow and customer loyalty without resorting to drastic price cuts. For consumers, it offers a transparent, value-driven shopping experience where every purchase contributes to cumulative savings. Moreover, it strengthens the bond between consumers and businesses, creating a community of mutual benefit and support.

Collectively, if we build this marketplace, The whole will truly be greater than the sum of its parts and all will benefit.

If we are successful, with 1 billion members, and 10 million businesses serving them, this company will be as valuable as some of the largest corporations in the world, yet every member and business in the marketplace will share in the value.

We have a long way to go, but we're off to a great start. I hope you'll join us in our mission to keep every business in business, and our vision of a world where consumer savings directly leads to the prosperity of businesses.

Matt