Russia's invasion of Ukraine, disrupted supply chains and post-pandemic demand have caused inflation in the US to accelerate to 40-year highs. Consumers are trying to save money in an overheated economy.
Cash-back options are one way to do that. The startup thinks it can beat competitors and save consumers money.
The app has just raised $165 million and operates in all 50 states.
Its partners include 30,000 gas stations, 19,000 restaurants and 500 grocery stores, as well as the likes of Uber, and its CEO hopes to expand to major retailers like Walmart.
Alex Kinnier is the CEO of Upside, a company he co-founded. He told Insider that the app puts value back into the community.
Kinnier is focused on achieving economic efficiency reminiscent of Economics 101 classes on supply and demand. He said the company gives buyers money for goods or services they would have bought anyway, and then brings more custom to the merchants they buy from.
He estimates that $550 million has been generated through this type of value creation, with most of the money going to merchants and the rest to consumers.
The app is free for consumers and Upside takes a slice of the profits.
Cash-back on fuel, groceries, and restaurant bills can be found on the app.
Kinnier said the average user in major cities uses the app nine times a month.
Kinnier said that Upside was able to prove to businesses that it brought in customers by showing the transaction amount attributable to the app.
He said that companies understand there is an opportunity for them to make more profit in a quick way with very little work.
Kinnier said that the system is constantly working to create a more efficient economic end-state.
Kinnier said other avenues needed to be explored to help shoppers, with an expectation that retailers such as Walmart and Target will pass on some of their rising costs to consumers.
Cash-back saves money for consumers, but some studies argue it only encourages more spending than they can afford.
The focus on essentials like gas and groceries makes Upside a former category. He said that the app had 40% growth in users between February and March.
You have to buy the categories that we are in. Consumers are desperate for control because inflation is out of their control. We can give them some of that.
Consumers are spending more on groceries and gas, according to Kinnier.
There are so many merchants that could use our help and so many consumers that could use our help.
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