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Business Models Business Operations

How Does Fetch Rewards Make Money (Business and Revenue Model)

The Fetch Rewards business model

How Does Fetch Rewards Make Money?
Here’s what you should know:
  • What is Fetch Rewards, and how does Fetch Rewards work?
  • How does Fetch Rewards make money?
  • Affiliate Commission Fees (Referral Fees)
  • Interchange Fees
  • Fetch Rewards’ profit and revenue
  • What is the Fetch Rewards business and revenue model?
  • Fetch Rewards’ funding and valuation

How does Fetch Rewards make money if it’s free and they pay you? Here is a full, in depth, breakdown of their two (2) revenue streams and the different products and services they offer, as well as the Fetch Rewards business model, their profit and revenue, and how Fetch Rewards works.

What is Fetch Rewards, and how does Fetch Rewards work?

Fetch Rewards is a service that allows users to earn free gift cards and cash back when shopping at select retail stores.

Founded in 2012 by Wes Schroll, Fetch Rewards now has over 13 million active users which led to more than $150 billion in US retail sales for its partnering stores, making it one of the most downloaded rewards apps in Apple and Google Play stores.

How Fetch Rewards works is: Before users can start earning free gift cards and cash back on purchases, they must first download the Fetch Rewards app.

Once done, users can begin shopping and submitting their eReceipts within the app. In return, the users get points and those points can then be redeemed for gift cards and other rewards.

Some of Fetch Rewards’ competitors include Ibotta, Honey, Groupon, Swagbucks, RetailMeNot, Upside, Dosh, and other cash reward programs.

Fetch Rewards App in Apple App Store | Fetch Rewards Business Model | How Does Fetch Rewards Make Money? | How Does Fetch Rewards Work?
Source: Apple App Store | Fetch Rewards

How does Fetch Rewards make money?

According to Fetch Rewards, the company has over 13 million active users which led to more than $150 billion in US retail sales for its partnering brands. So how does Fetch Rewards make money off of all these users?

Below is a breakdown of how much money Fetch Rewards makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 2 ways of how Fetch Rewards makes money (in 2022):

Fetch Rewards has a revenue model that makes money in two (2) ways  – affiliate commission fees and interchange fees.

#1. Affiliate Commission Fees (Referral Fees)

Fetch Rewards makes the majority of its money through affiliate commission fees, aka referral fees.

The way it works is: Every time a Fetch Rewards shopper makes a purchase at one of the partnering stores, Fetch is paid an affiliates commission fee by that store for generating a sale for the company.

According to Fetch, the company partners with “hundreds of popular brands”, of which, Fetch Rewards has yielded more than $150 billion in US retail sales for these partnering brands since its founding in 2012.

Fetch Rewards Affiliate Commission Fees | Fetch Rewards Business Model | How Does Fetch Rewards Make Money? | How Does Fetch Rewards Work?
Source: Fetch Rewards

Note: Affiliate commission fees are typically a percentage of the total sales prices. Though, Fetch Rewards does not make mention of how much of a percentage they recieve.

#2. Interchange Fees

In 2020, Fetch Rewards partnered with ONE Finance to create a debit card called Fetch Pay for its Fetch users. And later, in September 2021, ONE announced to bring Fetch Rewards to all of its cardholders.

So how does Fetch Rewards makes money through this? Interchange fees. What are interchange fees?

Interchange fees are fees paid between banks for the acceptance of card based transactions. So, whenever cardholders use their Fetch Pay Mastercard, the idea is that Fetch Rewards receives a portion of the interchange fee Mastercard charges the merchants.

The interchange fee that Mastercard charges merchants ranges from 1.15% to 3.25% + $0.10 of the charge amount.

Fetch Pay | Fetch Rewards Business Model | How Does Fetch Rewards Make Money? | How Does Fetch Rewards Work?
Source: ONE Finance | Fetch Rewards

Note: The percentage of the interchange fee Fetch Rewards recieves from this is unclear.

Fetch Rewards’ profit and revenue

Fetch Rewards has not released any official revenue numbers for 2021.

Note: Because Fetch Rewards, Inc. is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the Fetch Rewards business and revenue model?

Fetch Rewards makes money through a few revenue models that they combine within their company, they are:

  • Commission based business model

Fetch Rewards’ funding and valuation

According to Fetch Rewards’ Crunchbase profile, Fetch Rewards has raised $341.8 million over 8 rounds giving them a valuation between $1 billion to $10 billion as of Apr 2, 2021, according to PrivCo.