How many times each week do you buy something online using your debit or credit card? Do you ever spend time to think about how easy it is to use your payment card online? Today we take a look at a payment system that some believe was the original Internet shopping cart – the First Virtual Holdings payment system that was launched in 1994.
In the early days of Internet commerce, it was often cumbersome or even impossible to use credit or debit cards online. A San Diego California start-up sought to change that, by developing a payment system called “First Virtual”. First Virtual Holdings publicly launched their system in October 1994.
The system was launched on the same day that the New York Times published an article about the system.
The First Virtual system allowed users to open accounts (not surprisingly called “First Virtual accounts”). Users provided their names, addresses and credit card information. Once registered, a user could browse electronic information products available for sale either through a First Virtual catalog (called Infohaus) or on seller Websites. A buyer with a First Virtual account could select an item to purchase and First Virtual would cause an email to be sent to the buyer with the product (or a preview of the product). The email included a transaction code used to identify the product. If, upon receipt of the email, the buyer decided to follow through with the purchase, the buyer simply needed to provide the transaction code (by clicking on a link or entering it) and First Virtual would use the buyer’s information on file to complete the purchase.
The system was a precursor to other shopping cart systems that we now use on a daily basis. The Amazon Shopping Cart (and their 1-click version) did not come into wide use until 1995 or later.
The PayPal shopping cart came even later, as PayPal was not formed until 1998.
For some reason, First Virtual never gained wide adoption. However, the technologies they pioneered are still with us today.
What happened to First Virtual? According to Wikipedia,
Early rounds of investment came from leading institutions such as First Data, First USA, and GE Capital, leading to a successful IPO in 1996. First Virtual was sold and changed its name to MessageMedia (for $0.60 per share) on December 16, 1998. MessageMedia used the FV Email tools with considerable success in its Customer Relations Management Services (CRM) until MessageMedia in turn was forced to sell out to DoubleClick in the dot com crash for US$0.16/share in late 2001