Thoughts Regarding Coin

Yesterday afternoon Benedict Evans had something interesting to say regarding a new product-service pairing called Coin, questioning why anyone considered it anything more than a toy. Having never heard of the site, I continued scrolling until coming across Cody Fink’s referral link, at which point my “when in doubt wait until more than one person talks about it before taking the bait” rule kicked in and I opened Coin’s website. Over the next 1:45 Adam Lisagor serenaded me in a promo video nothing short of beautiful¹ that brought me — generally very averse to spending any significant amount of money — the closest I have ever come to impulse-buying anything, and especially something in the neighborhood of $50.

At its heart Coin aims to solve a very simple and base problem: an overabundance of credit card-like shims of plastic cluttering our wallets. Where others have failed though Coin looks to succeed: by taking the world as it is rather than as we want it to be, Coin accepts the cardholder’s inevitability by obviating the need to lug that multitude of cards around rather than thinking of a nuance manner in which to package them. In this respect I applaud Coin’s ingenuity: through the impressive combination of iOS app and physical device Coin enables a single card to serve the purpose of up to eight at any given moment with the simple tap of a button. And for those with more than eight cards, Coin’s iOS app possesses the capability to store an unlimited number it can then push to the Bluetooth-enabled card for near-instantaneous use.

Coin’s admirable promises belie a number of potential problems in its implementation details, however. For instance, Matt Gemmell cited one such obstacle yesterday on Twitter where he pointed to a lack of identifying PIN number and an unfamiliar design as a possible hurdle barring social acceptance. Unfortunately, I have to agree: I find it unlikely that the fifty-year-old cashier in Walmart would readily accept this strange little card in lieu of a traditional Visa. Perhaps some explanation and a trial swipe might convince her otherwise, but I fear this problem could recur all too frequently in everyday use to the point where rather than simplifying my life, Coin would instead greatly complicate it.

Unfortunately, Coin’s problems do not end here. Going back to its core value proposition of obviating the need to carry around all those pesky cards, I have a hard time believing I could ever shake the nagging fear that one day, at the most inconvenient time possible and when I least expect it, my Coin will cease working. Perhaps the battery dies or the cashier simply refuses to take it; Coin could fail for any number of reasons, leaving me stranded unless I also carried the very cards Coin intends to replace on my person at a times, in which case Coin serves no purpose besides further compounding the initial problem by adding yet another card of dubious value.

Although given a prospective battery life of two years, lacking an obvious meter by which to measure remaining power and unequipped with the ability to recharge Coin could fail at any time, after all. Especially given the state of today’s battery technology, I have a particularly hard time taking this impressive two year lifespan claim based upon estimates rather than real-world usage at face value. Coin’s creators seemingly sought to market their product to those looking for the rush born of not knowing whether their credit card would work every time they swiped it. Personally, I have no such desire.

This leads me to the final point I have to make with regards to Coin’s power source, that of planned obsolescence. Coincidentally this notion and phrase have seen quite a bit of use in the last week or so in conjunction with Catherine Campbell’s NY Times piece Cracking the Apple Trap, which many — myself included — chimed in on with wholly-justifiable objections. Given her article’s popularity I find it ironic that just two days later Coin launched explicitly employing the business model Catherine accused Apple of based on nothing more than anecdotal, touchy-feely evidence. Although a viable strategy whereby Coin generates additional revenue from an existing and presumably growing customer base every two years at the rate of $100 assuming the price does not fluctuate in one direction or the other, I can’t make it sit right with me. I know I can count on my car for somewhere in the neighborhood of ten years; I expect my computer to have become outdated in two or three years, and my iPhone in just one. However, I also know those devices will remain functional for an additional two at the very least, and my car for as long as I deign to keep it serviced. With Coin, however, there is a relatively hard end date after which the device will become utterly useless and devoid of any possible future use, and that model doesn’t quite sit right with me. Granted, paying such a negligible amount as $25 in its pre-order phase and $50 regularly per year in exchange for the service Coin could hypothetically provide is by any measure an acceptable exchange, but this largely foreign idea of planned obsolescence makes me uncomfortable as I’m sure it will make many others, putting up yet another barrier to widespread use.

Speaking of business models and aspects of this product that make me uncomfortable, Coin’s pre-launch strategy continues to confuse me. In service of raising $50,000 to begin production, Coin sells the promise of a future device for $50 immediately withdrawn from the customer’s account. I can’t help but question why Coin decided against Kickstarter — or Indiegogo for that matter — with such a model that would seem to fit so well within either service’s core competency. And while I cannot pretend to understand the intricate workings of these crowdfunding platforms, upon cursory inspection their rules do not appear to place any provisions which would restrict a device such as Coin from taking advantage of their services. Why, then, did Coin deign to roll their own “seed round”, if you will, rather than go with an established and proven platform? Perhaps for convenience, an unwillingness to forfeit a service fee, a desire to fill orders even if they do not reach the requisite funding amount, or due to a conflict in Kickstarter’s rules and Coin’s proposed operational model; we may never know. The cynical side of me, however, tends to err on the less-gracious spectrum.

In the end, nearly all my questions and misgivings regarding Coin come down to one single issue: a deficiency of faith. I lack faith that Coin will work everywhere I need it to, and that even if it did work everywhere I worry few locations will accept it; I lack faith that I will one day swipe my card and find its battery to have died in the night; I lack faith in Coin’s business model reliant on concurrent $100 purchases every two years. The single most pressing problem, then, the base requirement barring Coin’s success is that of establishing strong faith and trust in their platform. Solve that problem, my friends, and your road to success will be paved in gold and the shredded remnants of cast aside credit cards.

There are a few other improvements I would be remiss to suggest a this point though, purposely aligning with the misgivings I have regarding this service. Unsurprisingly, the first deals with power: Coin would appear much more attractive with an inductively-charged battery. As this would effectively destroy their model for recurring revenue though, I also have a suggestion there, where one route could see Coin charge separately for said charging station. Those wanting the ability to charge their cards and thus extend its battery life past two years need only purchase a special charing station at, say, $50 a pop. A far cry from the $100 each successive card would generate every two years though, I also recommend taking advantage of a subscription model through Coin’s iOS counterpart. Relying on constant communication between the card and said app — Adam even demoed the feature in Coin’s promo video where he walked away from his card, “like a dummy”, and it called him back — one alternative business model could entail paying a negligible monthly fee — say, $5 — for continued use of Coin; failure to comply would immediately deactivate the card. This would actually generate more revenue than buying a new card every two years — $120 versus $100 — while simultaneously cutting down on production costs as Coin must manufacture fewer cards each year and lending itself to an improved user experience as each Coin could, potentially, last much longer than originally planned.

Unfortunately, both these changes would require an entire overhaul of Coin’s inner workings given their predication on a rechargeable battery — the first for obvious reasons as an induction charger without a capable battery would serve little use, and the second because a subscription model designed to perpetuate Coin’s usage in the face of a hard end of life makes equally little sense. Since these suggestions would effect a second iteration then, let me go out on a limb and — blue-sky solutioneering here — suggest a small e-ink display for displaying bar codes. Shopping, library, and even some gift cards rely on these little black lines rather than magnetic strips, making Coin in its current for useless for these applications.

All said and done, despite my misgivings, I have great faith in Coin’s success: it pushes the boundaries of an established industry with an amazing product that — for all the nitpicky “flaws” I pointed out — is incredibly polished on day one, and will only get better. Further, most will not see the absence of an inductive charging system as a downside or look at Coin’s launch strategy with curiosity born of cynicism; most will see a delightfully attractive black card capable of simplifying their lives replacing the source of their back problems, and for that I believe Coin will succeed. I backed it, after all, in anticipation of the day where I can replace every single card in my wallet with One Coin, and to do so indefinitely.

↩ Upon watching Sandwich Video’s introductory production, questions immediately sprang forth uncalled. Perhaps most important of which, if I held a Coin and flicked my wrist upwards would all my associated cards pop out? For all their cinematographic magic, Sandwich Video did a poor job answering that question.