Chirpify raises $1.3 million, expands Twitter payment platform

Chirpify, a payment platform that uses Twitter to conduct transactions, opened the eyes of a lot of brands and retailers when its commerce service launched in February by showing them how Twitter could help them sell directly to followers. Hewlett-Packard (s hpq), Nestle and Powerbar are among some of the brands that have signed up to use the service. Now investors are taking note: the Portland, Ore. company is announcing Tuesday that it has secured $1.3 million in Series A funding from a group of investors including Voyager Capital, angel investor Geoff Entress, BuddyTV CEO Andy Liu, former Facebook executive Rudy Gadre, HootSuite CEO Ryan Holmes, and TiE Oregon Angels.

Chirpify, which started by focusing on physical goods, is now expanding the platform to include digital content, so companies and artists can sell music, videos and tickets directly to their fans.  Rhymesayers Entertainment, a Minneapolis-based hip-hop label, is one of the first customers to use Chirpify’s new Twitter Commerce for Digital Commerce platform and it will sell music and other goods to its fans over Twitter.

Chirpify works by letting sellers advertise a deal and complete the transaction without leaving Twitter. For instance, a music seller could upload their content to Chirpify’s platform and then push out a tweet asking their followers to buy a certain track by replying with the word “buy” in their tweet. If the consumer already has a Chirpify account, the money will get automatically deducted from the PayPal (s ebay) account that they connected through Chirpify.  If the buyer doesn’t have a Chirpify account, they are prompted to set one up along with a PayPal account if they need one. The transaction is completed through a direct message to the consumer with a link to download the digital content. For physical goods, the seller will send the goods to the address listed on the user’s Chirpify account.

Chris Teso, founder of Chirpify, told me he’s working on lining up other payment options aside from PayPal. And he said there is still a bit of a learning curve for some customers, who are surprised to see how easy it is to buy something through Chirpify. But he said the platform is proving to be popular with Fortune 500 companies, who are able to monetize their social media relationships with fans. The move to expand to digital content was prompted by musicians and artists, who saw a similar opportunity to sell their stuff to their followers. He said there’s also room for authors and comedians to sell their wares directly through Chirpify.

“We were focused on the physical implementation for brands but we backed into the digital commerce. But it makes way more sense. If you sell on iTunes, they don’t get data back. They don’t know who they’re selling to. But they have Twitter followers so we just let them sell directly to them,” Teso said.

Chirpify members also seem to find the service useful. Though Teso won’t say how many people are on the platform, he said 50 percent of members have transacted on the platform. In addition to an e-commerce platform, Chirpify also enables peer-to-peer payments and donations as well.

The company is opening up a lot of opportunities for companies and artists to really starting making money through social media. As we’ve seen with comedian Louis CK, there’s a lot of money to be made by selling directly to fans. It won’t work for every product: Teso said they’re figuring out how to tackle things like sizes and customization, which is harder to handle over Twitter. But I think this is still a pretty awesome way to sell and cut out some middle men along the way.