What is Spare and how does it work? Spare is a virtual ATM network and mobile app that allows users to withdraw cash from participating merchants instead of using traditional ATMs. Users deposit funds into the Spare app and then use it to request cash from a nearby merchant, who dispenses the cash and is paid a small fee by Spare for the service. This benefits both customers, who gain convenient access to cash, and merchants, who receive increased foot traffic and reduced ATM fees.

Spare Shark Tank Update | Shark Tank Season 10

What is Spare?

Spare is a financial technology company that provides a mobile app and platform connecting users with businesses that dispense cash. Think of it as a “cash-back” option without needing to make a purchase.

Users simply download the Spare app, link their bank account or debit card, and then use the app to locate nearby participating businesses. They can then withdraw cash directly from these businesses, often at a lower cost than traditional ATMs.

This benefits both the user, who enjoys convenient and potentially cheaper access to cash, and the business, which benefits from increased foot traffic and potential new customers.

Spare on Shark Tank

Spare’s founder, D’Ontra Hughes, appeared on Season 10 of Shark Tank to pitch his innovative idea to the investors (known as “Sharks”).

He was seeking an investment to help expand his network of participating businesses and grow the user base.

Here’s a breakdown of his pitch and the outcome:

1. The Pitch

Entrepreneurs	D’Ontra Hughes
Business	Spare – Virtual ATM app
Ask	$500,000 for 3.5% equity
Deal	$500,000 for 12% equity and 2% advisory shares
Sharks	Mark Cuban
Season – Episode	Season 10 – Episode 20
Original Air Date	April 14, 2019
Website	Spare
Key Points of Pitch	Eliminates the need for traditional ATMs Offers lower fees for cash withdrawals Provides increased foot traffic for participating businesses Convenient and secure way to access cash
Why Sharks Accepted	Mark Cuban saw the potential of Spare to disrupt the traditional ATM market and liked the innovative business model.

2. The Deal

While D’Ontra Hughes initially sought a $500,000 investment for 3.5% equity in Spare, the Sharks were hesitant due to the high valuation.

Ultimately, Mark Cuban offered $500,000 for 12% equity plus 2% advisory shares. Hughes accepted the offer on the show; however, the deal ultimately did not close after filming.

Despite this setback, Spare has continued to grow and thrive in the years since its Shark Tank appearance.

Spare Update After Shark Tank

1. Deal with Mark Cuban

Although D’Ontra Hughes accepted Mark Cuban’s offer of $500,000 for 12% equity and 2% advisory shares on Shark Tank, the deal ultimately fell through after the show.

This is not uncommon, as due diligence and negotiations often reveal complexities not apparent during the initial pitch.

2. Company Growth

Despite not securing funding from the Sharks, Spare has continued to grow and find success. They have expanded their network of participating merchants and increased their user base.

As of June 2023, Spare reported an annual revenue of $4 million, demonstrating significant progress since their Shark Tank appearance.

This shows that even without a Shark Tank deal, entrepreneurs with strong ideas and determination can still achieve their goals.

3. Partnerships

A key factor in Spare’s growth has been its ability to form strategic partnerships.

They have collaborated with major companies like Mastercard and LiteLink Technologies Inc. to expand their reach and offer more services to their customers.

These partnerships have helped Spare gain credibility and access valuable resources, contributing to their continued success.

How Spare Works

Spare’s platform is designed to be simple and user-friendly for both customers and merchants. Here’s how it works:

1. For Customers

• Download and Register: Customers first download the Spare app and create an account. They link their bank account or debit card to the app to fund their Spare wallet.
• Find a Location: Using the app’s map feature, customers can easily locate nearby businesses that are part of the Spare network.
• Withdraw Cash: At the participating business, customers simply open the app, enter the desired withdrawal amount, and show the generated QR code to the cashier. The cashier then dispenses the cash, and the transaction is complete.

2. For Merchants

• Sign Up: Businesses can sign up to join the Spare network through the company’s website or by contacting Spare directly.
• Receive Training: Spare provides training and support to help businesses integrate the platform into their operations.
• Dispense Cash: When a customer requests a cash withdrawal, the merchant scans the QR code displayed on the customer’s phone and dispenses the requested amount. Spare then reimburses the merchant for the dispensed cash, plus a small fee.

Benefits of Using Spare

Spare offers a range of benefits for both customers and merchants:

• Convenience: Customers can access cash quickly and easily without needing to find an ATM.
• Lower Fees: Spare often offers lower transaction fees compared to traditional ATMs, saving customers money.
• Increased Foot Traffic: For merchants, participating in the Spare network can drive more customers to their business.
• Reduced Cash Handling: By dispensing cash digitally through Spare, businesses can reduce the risks and costs associated with handling large amounts of physical cash.
• Community Focus: Spare often partners with local businesses, supporting the community and fostering economic growth.
• Security: Spare uses advanced security measures to protect user data and transactions, ensuring a safe and reliable experience.

Spare’s Competitors

While Spare is a pioneer in the virtual ATM space in the US, it’s not alone in the broader fintech landscape. Several companies offer similar services or compete in related areas:

• Cash-back apps: Apps like Cash App and Venmo offer cash-back rewards at certain retailers, providing an alternative way to access cash.
• Mobile banking apps: Many banks now offer features within their mobile apps that allow customers to locate nearby ATMs or even withdraw cash at participating retailers.
• International competitors: Spare faces competition from similar virtual ATM platforms operating in other countries, such as NakitBasit in Turkey and GoCash in Jordan. These companies may eventually expand into the US market.

Spare differentiates itself through its focus on partnerships with a wide variety of businesses, its user-friendly app, and its commitment to providing a convenient and affordable cash withdrawal solution.

Spare’s Future

Spare’s future looks promising. The company has shown resilience by overcoming the failed Shark Tank deal and achieving significant growth. To continue its success, Spare can focus on several key areas:

• Expanding its network: Increasing the number of participating merchants will make Spare even more convenient and accessible for customers.
• Adding new features: Spare can explore adding features like bill pay, peer-to-peer transfers, or even cryptocurrency integration to attract more users and increase engagement.
• Marketing and awareness: Raising awareness of Spare’s services through targeted marketing campaigns can help attract new customers and solidify its position in the market.
• Geographic expansion: While currently focused on the US market, Spare could potentially expand its services to other countries, tapping into a global demand for convenient cash access.

By continuing to innovate and adapt to the evolving needs of customers, Spare has the potential to become a leading player in the future of finance.

FAQs

Is Spare available nationwide?

Spare is currently available in select cities across the US. They are actively working on expanding their network to more locations. You can check their app or website to see if Spare is available in your area.

What are the fees for using Spare?

Spare’s fees vary depending on the merchant and the amount of cash withdrawn. However, they generally aim to offer lower fees than traditional ATMs. The exact fee will be displayed in the app before you confirm your withdrawal.

Is Spare safe and secure?

Yes, Spare takes security seriously. They use encryption and other security measures to protect user data and transactions. They also partner with reputable businesses to ensure the safety of their users.

Can I use Spare with any bank account?

Spare works with most major banks and debit cards. You can link your account directly through the app. If you encounter any issues, their customer support team can assist you.

What if I have a problem with a transaction?

Spare has a dedicated customer support team to help with any issues. You can contact them through the app or their website.

The Bottom Line

Spare offers a fresh and innovative approach to accessing cash. By partnering with local businesses, they provide a convenient and often cheaper alternative to traditional ATMs. While the Shark Tank deal may not have materialized, Spare has proven its ability to grow and thrive independently. With a focus on user experience, security, and strategic partnerships, Spare is well-positioned to play a significant role in the evolving financial landscape.