500friends, a Merkle Company

500friends was a software-as-a-service provider specializing in omnichannel loyalty programs for retailers. Founded in 2010 by Justin Yoshimura and Hong Hu, the San Francisco-based company emerged from the Y Combinator accelerator program. Yoshimura, a young entrepreneur who had previously dropped out of high school, served as the company's CEO, bringing a distinctive drive to the venture. The firm secured significant venture capital, raising a total of $10.9 million over several funding rounds from investors including Intel Capital, Crosslink Capital, and Fung Capital.

The company's core offering was LoyaltyPlus, a cloud-based lifecycle marketing suite. This platform provided retailers with a comprehensive solution to design, manage, and analyze customer loyalty initiatives across multiple channels, including in-store, online, and mobile. It enabled businesses to reward customers for a wide range of engagements beyond simple transactions, such as writing product reviews, referring friends, or sharing content on social media platforms like Facebook and Twitter. The business model was subscription-based, offering retailers a white-label product that could be integrated directly into their existing websites and mobile applications. This provided a unified view of customer interactions, allowing clients to create more personalized marketing and shopping experiences. Key features included advanced analytics, gamification tools, and segmentation capabilities.

A significant milestone in the company's history was its acquisition by Merkle, a global customer relationship management (CRM) and performance marketing agency, in November 2014. The acquisition, reportedly for an eight-figure sum, was a strategic move for Merkle to bolster its customer engagement and loyalty services, particularly within the retail sector. For 500friends, the deal provided access to Merkle's extensive resources and market presence, with the goal of accelerating its growth and establishing itself as a dominant loyalty solutions provider. Following the acquisition, the entire 500friends team was integrated into Merkle, and Yoshimura took on the role of Senior Vice President of Loyalty. The LoyaltyPlus platform continued to be a key offering, recognized by industry analysts for its flexibility and ease of use.

Keywords: loyalty marketing, customer retention, omnichannel retail, SaaS, customer engagement platform, LoyaltyPlus, Justin Yoshimura, Merkle, retail technology, social rewards, gamification, e-commerce loyalty, customer analytics, lifecycle marketing, rewards program, CRM integration, marketing automation, Fung Capital, Crosslink Capital, Intel Capital