Venmo Addresses ‘VSBs’ with Business Profiles

One trend we continue to track is the continued rollout of SMB tools that streamline traditional functions. Several of these tools are mobile-first or mobile-only, catering to “deskless” SMBs; or mobile natives who are more inclined to adopt mobile payments, messaging and other functions.

WhatsApp’s merchant-facing Business app is one example of this trend, examined earlier this week. Now used by 50 million active SMBs (accelerated by Covid-era demand signals), it helps them market to, and transact with, customers from a streamlined messaging interface, a la “conversational commerce.”

While examining WhatsApp’s latest, another app caught our eye for similar reasons. Venmo is making a stronger push as an SMB-facing transactional tool. The millennial-favorite peer-to-peer payments app owned by PayPal has natural adjacency to SMB payments, making this a logical extension.

Putting the “S” in SMB

Specifically, Venmo is piloting a new feature called Business Profiles. They consist of pages that let merchants introduce themselves and display business details like address, phone number, email, and website. It’s a sort of expanded version of the user profiles that all Venmo users have.

This specifically addresses the “S” in SMB, or very small businesses (VSBs), with a more professional profile to display within Venmo. This will resonate with small sellers and sole proprietors who are prevalent on Venmo, and want to instill buyer trust by evoking a more professional vibe.

Beyond those benefits, Venmo offers distribution through its social feed and search functions, making these businesses discoverable. That includes Venmo’s signature feed of friends’ transactions that users can browse. Business Profiles are exposed and clickable in that feed, bringing some marketing benefit.

Further along those lines, sellers can email, print, text or AirDrop a QR code that links to their business profile. This could be utilized in places like a farmer’s market stand or pop-up store signage. Meanwhile, Venmo users can now search using “people” and “business” tabs to delineate the two.

For an additional practical benefit, Business Profiles can help SMBs manage incoming payments, and parse business versus personal revenue for tax purposes. This again demonstrates the focus on VSBs, as many will likely be individuals with both personal and business payments flowing through Venmo.

Lastly, as is table stakes for payment apps these days, Business Profiles will offer analytics. This will let merchants see sales figures, trending over time, and lists of customers that have transacted. The latter can be valuable in a CRM sense for follow-on marketing (signaling the next Venmo update perhaps).

Sign of the Times

In some ways, this will cater to SMBs that don’t have a web presence or those that want to augment it through more channels. The latter include SMBs already on Venmo, and others that it hopes to attract. Venmo is already used by a wide range of VSBs, from farmer’s market sellers to Etsy creators.

For the latter, Venmo’s move is also a sign of the times. We continue to see tech providers that serve SMBs pivot to (or enhance) all-things eCommerce and payments. As SMBs are forced to scramble to a new way of doing business, SMB SaaS players see it as a prime opportunity for customer acquisition.

The question is if those demand signals sustain as SMBs pick up new habits during the current period that end up representing long-term adoption. That’s our ongoing theory but we’ll have to see how the coming months and years unfold as the world of local commerce returns to some version of normal.

Meanwhile, Venmo Business Profiles are free during the pilot period, but will apply charges in the future that include 1.9 percent per-transaction plus $.10 for purchases that happen through the profile page.

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