Startup OneText raised $4.5 million from Khosla Ventures, Y Combinator, and others

The American startup OneText, founded by former PayPal employees, has raised $4.5 million in a seed round from Khosla Ventures, Coatue, Citi Ventures, Y Combinator, and the Good Friends fund, created by the founders of Warby Parker, Allbirds, and Harry’s. Muse frontman Matt Bellamy is also among the investors.

OneText is building an alternative to the classic online checkout — a “shopping grid via text messages.” Buyers can complete purchases simply by replying to SMS, without visiting a website or downloading apps. Meanwhile, brands don’t need to change their current payment system — OneText integrates into it, creating an additional channel with “pay-by-phone-number” functionality.

The startup uses AI and a “human in the loop” for personalized conversations, recovers shopping carts, and offers upsells and recommendations. According to founder and CEO Jonathan Fadima, this increases conversion rates by 20-30%.

After the first purchase, OneText stores the customer’s payment details and allows orders to be placed again without re-entering card information. The user receives an SMS notification about automatic deduction within 24 hours if they do not manually cancel it — an approach the company calls “voluntary automation.”

Currently, OneText works with e-commerce brands with annual revenues of at least $10 million, but is open to both small startups and large companies. In the future, the team plans to create a full-fledged cross-brand network where one customer profile will work across different stores.

The startup completed acceleration at Y Combinator in 2023 and has shown triple-digit annual growth since then.

Source: TechCrunch