The co-founder and CEO of a rewards-based credit card which targets "adventurous millennial and Gen Z professionals" has hinted that it could launch more membership tiers after launching a free membership.
Yonder was founded by Tim Chong, Theso Jivajirajah and Harry Jell, alumni of credit score startup ClearScore, in 2022. It is backed by ex-footballer Rio Ferdinand, GoCardless co-founder Matt Robinson, Northzone and RTP Global.
Yonder is a small challenger but growing, with a valuation of more than £70m, which is trying to disrupt the credit card giants.
Yonder allows customers to earn rewards points for every £1 spent, which can then be redeemed at its experience partners around London, such as entertainment venues, restaurants, bars and fitness studios.
It kicked off with a £15 paid membership offering and has now launched a free membership.
Co-founder and CEO Chong says Yonder now has nearly 10,000 members and says it was always in its business plan to launch a free membership.
The demographic of its paid members is, broadly speaking, 29 to 30-year-olds, mass affluent.
"10,000 is a “really good number for our size,” says Chong.
“The fact that people are willing to pay for it shows that we are creating something really special.”
He says the free membership tier is a good way to introduce people to Yonder who might upgrade to a paid membership.
The free membership allows earned points to be used towards curated London and UK-wide dining, travel, fitness and lifestyle partners that change each month such as Thai restaurant Speedboat Bar, Swift cocktail bars, F45 fitness classes, meal-prep service Lions Prep and car sharing marketplace Turo.
There are also no FX fees for free members when spending abroad.
On the prospect that the free membership might cannibalise paid members, Chong says cannibalisation in beta has been “very minimal”.
Describing the free tier’s target market, he said:
“The free tier is about someone just using Yonder casually, maybe using it for travel, maybe wanting to try it out. For paid customers, you really, really want to get the full experience.”
He added:
“If I am being honest, if you want to downgrade, it means we are not giving you enough value in the paid product.”
He hinted there could be more tiers in the future.
Yonder raised £62.5m in equity and debt Series A funding in 2023 which resulted in a post-money valuation of more than £70m.
Chong added:
“There are nearly 59 million credit cards in the UK and the market has traditionally always been dominated by the same major players. But despite so much technological progress, credit cards fundamentally haven’t changed and customers have been misled for decades by attractive minimum monthly payments and hidden fees."
Lead image via Yonder.
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