
Refundit
Refundit automates the VAT,
or value-added tax, refund process for tourists visiting the European Union.
Users can submit their VAT refund request through the Refundit app, even before
they arrive at the airport and without having to stop at customs.
Refundit’s founders are
Uri Levine, the co‐founder of navigation app Waze acquired by Google for $1.15
billion in 2013, and Ziv Tirosh, founder of Stockton Group, a bio-pesticide maker
acquired by a Chinese company for $90 million in 2015.
Describe both the business and technology aspects of
your startup.
Refundit is a travel tech
startup designed to completely transform the VAT refund (tax free shopping)
scheme for tourists in Europe, creating a new and fully digital process that
will have numerous benefits for tourists, retailers, authorities and
governments alike.
Refundit clears up the red
tape and cuts the lines for non‐European Union tourists, allowing them to
quickly and efficiently obtain their VAT refund through a simple mobile app,
making shopping more attractive and contributing to the growth of tourism
economy.
The core innovation Refundit
brings is the fully digitized and paperless process, which allows tourists
to submit their request through a mobile app, and allows tax authorities to
approve the refund online. The app frees tourists as well as retailers from
needless lines and paperwork. The tourists can now obtain the VAT refund at all
stores, with no effort on the side of the store.
Tourists can download the Refundit
mobile app to their smartphone, take a photo of valid receipts along with their
boarding pass and passport and send their request. That’s it. No need to stand
in line, fill out forms or rush to the airport. It’s simple and will only take
a few seconds to complete.
Refundit provides local
authorities (customs, VAT, etc.) with a
special digital system which enables them to receive, track and
authorize the requests before the tourist’s flight. Only in special cases will
tourists be requested to stop and show the goods at customs at the airport.
Digitizing the process enables tax authorities, for the first time, to
integrate innovative capabilities such as big data, artificial intelligence and
fraud prevention into the VAT refund process, to better manage, document and
analyze data.
What inspired you to create this company?
Refundit’s founders are well-experienced entrepreneurs - Uri Levine and Ziv Tirosh - and both are looking to
empower consumers around the world and save them time and money.
The idea was Uri Levine’s.
Uri is passionate about empowering consumers and helping them save time and
money. He hates standing in line and any waste of time, and the many cases in
which the money was never returned made him understand there is an inefficient
process that needs major disruption.
Give us your SWOT (Strengths, Weaknesses,
Opportunities, Threats) analysis of the company.
We are the first to develop a
fully digitized process with a friendly mobile app that offers advantages to
all stakeholders – tourists, retailers, authorities and governments – with
everyone enjoying it. We help them get rid of all paperwork and lines, developing
the infrastructure for monitored processes through big data and analytics
capabilities.
We depend on governments and
their collaboration. The good news is that we see great interest in digital
innovation from governments throughout Europe - all want to make the process
more efficient, valuing the strength of making tax-free shopping easier in
attracting tourists and increasing their spending.
We have great interest and
have met in recent years with more than 17 countries in the EU and believe
things will proceed to the benefit of all stakeholders.
Some 90% of VAT refund is “left on
the table” and does not reach its rightful owners. This makes about 23 billion euros
out of a total of 26 billion euro annually. With a fully digital solution, this
market also has the potential to grow since more tourists will want to shop
while they travel. These are very large numbers ‐ a huge market is waiting for
a disruption.
In some countries there have
been attempts to digitize the process, yet most of it is still manual, or
partly manual, with the need for tourists to stand in line to stamp their paper
invoice digitally in a special kiosk, for instance. So, the problem is not yet
solved, and we hope to get the opportunity to change how things are operated in
the EU.
What are the travel pain points you are trying to
alleviate from both the customer and the industry perspective?
We save tourists time and
money on their shopping through a friendly, easy-to-use app that makes it all
more enjoyable helping them skip the long lines and paperwork on their way to
get the refund they are entitled to by law.
Small- and medium-size
retailers benefit, being able to attract tourists by offering refunds as well,
with no need for them to do anything but sell. We take care of the rest. Benefiting
from Refundit’s services are also the local tax authorities, who enjoy a state-of-the-art digital platform and capabilities it brings, and governments
promoting bigger tourist spending on shopping, stimulating economic growth.
Another important fact is
that tourists pay substantially less fees with Refundit, since Refundit sets a
new standard in the industry by offering the lowest and most transparent
handling fee in the field ‐ 9% as compared with current agents who charge
30 to 50% of the refund.
So you've got the product, now how will you get lots
of customers?
Refundit has two different
types of customers: 150 million non‐EU tourists who visit the EU every year and
do quite a lot of shopping as part of their visit. The others are the tax
authorities and finance ministries across the EU. Refundit helps stimulate tax-free
shopping in their countries.
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We offer authorities enhanced
fraud prevention tools, full control and data analysis of the process and the
opportunity to improve service to tourists. Our team meets officials all over
Europe and presents them with the solution.
As for tourists, we reach
them through different channels: directly via digital media and PR, through
retailers who use our service as a “sales tool” in their store, and also
through different travel industry partners. We believe that once the service is
in several countries it will become the “must have” app for tourists.
Tell us what process you've gone through to establish
a genuine need for your company and the size of the addressable market.
More than 50 countries in the
world have a VAT refund scheme for purchases of goods
tourists take with them when leaving the country. In Europe, VAT on clothing,
electronics, toys, etc., ranges between 17% to 27%.
Around 90% of these VAT
refunds, some 23 billion Euros out of a total of 26 billion per year, don’t
reach the tourists. Why? Most tourists just give up on the refund as they must
go through a process which might
include: standing in long lines, navigating complex forms, paying high
commissions and, in the end, not always receiving their money back due to a
lack of a traceable paper trail. Refundit helps overcome all this.
Refundit provides its
services today to non‐EU tourists in Belgium, in collaboration with the Belgian
Ministry of Finance. Refundit is now launching the service in Slovakia with the
Slovak Ministry of Finance collaboration. Our plan is to help tourists to
obtain their VAT refund across the EU and we are in contact with most of the EU
governments.
How and when will you make money?
We already have income from
our users. As our mission is to empower the tourist, Refundit sets a new
standard in VAT refund handling fees with a minimal and transparent 9% percent
commission from the VAT refunds as compared to 35 to 50% cut that current agents
charge today.
What are the backgrounds and previous achievements of
the founding team, and why do you have what it takes to succeed with this
business?
Our co‐founders are Uri
Levine, the co‐founder of Waze (and many other startups) and Ziv Tirosh,
founder of Stockton.
Uri co‐founded Waze, the
community-based mobile navigation app that was acquired by Google in 2013 for
over a billion dollars. Now he is a serial entrepreneur, with several startups,
some of them in the travel tech industry.
Uri invests his time and
energy in developing new startups that are focused on saving consumers time
and money. He’s co‐founder/chairman/board member in Moovit (public
transportation navigation app), Fairfly (monitors the airfare after reservation
and rebooks once price drops), Roomer (marketplace for non‐refundable hotel
reservations), Wetrip (enabling Generation Y travelers to easily book concept
holidays together), Engie (diagnostics and maintenance app that empowers car
owners), LiveCare (the first smart medical alert device specifically intended
for the elderly), Refundit and more.
Ziv was the founder of the
Stockton Group, a world‐renowned bio‐pesticides firm. China’s Hebang group
bought a majority stake in Stockton for $90 million in 2015. Ziv built up the
company over a long period of time and made it a global leader in the
agriculture industry.
Both of our founders are men
of vision and with a deep understanding of what it’s like to take an idea,
build a team who will marry it with technology and see it through to
implementation. In today’s startup world, there are many pitfalls that must be
avoided while not losing sight of the business’ goals, which is not just making
money but also to contribute to society as a whole and leaving the world a
better place.
What's been the most difficult part of founding the
business so far?
Getting into new countries is
the most challenging part of the business, but it also creates the barrier to
entry. We are also proud to say that in only 18 months we have been able to
implement our solution into two countries ‐ which we see as great results for
the time frame since our establishment.
Generally, travel startups face a fairly tough time
making an impact ‐ so why are you going to be one of lucky ones?
We believe in our mission of
making tax refunds for tourists in the EU more fun and easy. The amount of money left on the table due to the tedious
process, along with the high interest we get from governments and tourists, all
show that we identified a real and painful area that demands a solution. We are
the first ones to create an end-to-end digital solution and to engage with all
stakeholders. Our model truly creates value for the authorities, the retailers
and the tourists.
Something you would like to add?
Yes, we are also very proud
to have won the first prize in the first United Nations World Tourism
Organization ‐ Globalia competition for travel tech startups. We were chosen
out of close to 3,000 startups from 132 countries. This happened just in January. We are excited by the recognition we received to the
contribution of Refundit to global tourism economy and tourists' experience.
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