UK start-up Yoyo has raised $5 million in seed funding to develop its mobile payments and loyalty service targeted at London students.
The investment was led by Imperial Innovations, which invests in technology from academic research, along with Firestartr, which is described as a new digital venture platform, as well as Telefonica.
Angel investors brought into the round by Firestartr include Barry Smith, co-founder of Skyscanner; Mathias Entenmann, former MD of PayPal Europe and Paypal International; and John Chaplin, former EVP at Visa Europe.
Yoyo is hardly alone in chasing the mobile payments and loyalty market but its pitch is to offer a superior customer experience using an app which simplifies and speeds up in-store transactions by combining payment and loyalty via the scan of a QR code.
Its targeting of university students is unusual for the UK but smacks of much-hyped US start-up Clinkle. But unlike its peer in the States, Yoyo has actually launched its service.
Released earlier this year, Yoyo is already handling over 30,000 transactions per month across 32 food and drinks outlets at Imperial College London. Now it is rolling out the service to the University of Greenwich and University of Westminster. And Yoyo plans to announce further partnerships with universities, and also high-street retailers, over the coming months.
Telefonica is also an investor in Ensygnia, a UK start-up that enables a user with a smartphone to scan and make e-commerce transactions.
Yoyo was founded in 2013 and previously raised $1.3 million from angel investors, according to its website.
The firm will use the latest funding to support its expansion over the next 12 months, first in the UK, and then the US and European markets.
Yoyo will also use backing to grow its partnership programme with point-of-sale software vendors and leading catering companies. The company is looking to raise a Series A round later in the year.