By Virginia Blanton
Jonathan Hayes could not believe his older brother’s magic worked: He scored two business class plane tickets to South America for $2.50 apiece by strategically applying reward points after months of research.
Boarding the flight, Hayes awaited the moment when he and his brother would be ushered to the plane’s last row. But when the stewardess hovered by their spacious seats, the only thing she asked was if they wanted champagne or orange juice.
At that moment, Hayes decided everyone needed to experience luxury treatment at least once in their life.
The birth of Rewardstock
That voyage in 2011 inspired Rewardstock. Based out of Raleigh, North Carolina, Rewardstock is an entrepreneurial venture that helps users go on vacations they would otherwise be unable to afford.
Hayes left a steady, 7-year investment banking career at Citigroup in 2014 to create Rewardstock and be present with his family, leaving Wall Street for the City of Oaks.
“Our success implies that people all over the world are having cool experiences. Experiences are ultimately what matter in life and enrich your time here. Fancy, glass-case things don’t have that power,” he said.
Inspired by his brother Jason’s frugality, Hayes tested his own hand at reward point magic a year after their South American excursion. With the help of reward points, he and his wife were able to go on a $40,000 honeymoon in the Maldives for just $200.
“We googled ‘paradise’ and went with the first image that came up,” his wife, Alison, said.
Alison and Jonathan flew first class and stayed at a luxury resort for eight nights. That’s when Jonathan realized he could make this game a legitimate business.
By using reward points most Americans overlook, Rewardstock’s algorithm shows users how to take advantage of frequent flier miles and credit card points to cash in on extravagant trips.
“Everyone knows that flier miles and card points are valuable, but Jonathan has gone beyond that –– he figured out the pathways for exchanging miles for points and back again in a way that expands the value of your holdings,” said Patrick Conway, an economics professor at UNC-Chapel Hill.
Hayes’ last Citigroup bonus financed the first seed funding for Rewardstock. The website went live in 2016. Traffic was fleeting. What they were doing wasn’t working.
Hayes had been growing an impressive beard at the time. One day, he woke up and decided to shave everything but the thick handlebar moustache. He claims the facial hair change was symbolic of the need to approach Rewardstock’s mission differently.
Into the shark tank
Out of the blue, cyberspace delivered Rewardstock a support ticket that changed the company’s trajectory –– a casting director from the TV show “Shark Tank” reached out to the Rewardstock team to come on the show, which helps budding entrepreneurs break into their desired industry.
Hayes and the Rewardstock team agreed to give the show a chance.
“We encouraged him to write out his speech word-for-word, memorize it and rehearse it a thousand times –– also prep for anticipated Q&A,” said David Gardner, Hayes’ first investor.
In November 2018 Hayes pitched Rewardstock to the country on ABC.
Kevin O’Leary and Mark Cuban sat up in their chairs when Hayes mentioned he was a former investment banker. He wasn’t just a great presenter, he also knew how to calculate margins.
Hayes said one difference between the broadcast show and his actual experience was that the “sharks,” or investors, actually talk to the contestant for close to an hour, firing dry questions that don’t make for good TV.
“America doesn’t care that we are incorporated in Delaware,” Hayes said.
There were no second or third takes –– Hayes only had one chance at making an impression.
From binging prior episodes, Hayes observed the difficulty founders faced pitching their apps once enclosed in the tank. There is no advantage of a physical product or freebie to give out.
Enter the fire twirlers, leis and coconut drinks. Hayes outfitted the “sharks” and gave them a cultural performance to replicate the experience of traveling.
Hayes walked away with a $320,000 deal from Mark Cuban. Since the episode aired, Rewardstock has helped explorers across North Americ save a total $250,000 in travel fare.
“We have tons of Canadians trying to sign up right now. Shark Tank is very popular in Canada,” he said.
Hayes presents his company to the ‘sharks’ on ABC’s television show “Shark Tank.” Since the episode aired, Rewardstock has helped North American travelers save a total of $250,000.
The investors’ roles don’t end with the show’s closing credits.
“Mark is very engaged. We communicate about once every other week via email. He has the fastest email response time ever,” Hayes said.
He jokes that he has the real Mark Cuban and the Mark Cuban of the Southeast, David Gardner, on his side.
“We often talk of the ‘quants’ of Wall Street that bring algorithms to stock trading. Jonathan is bringing his algorithm to the use and trading of another asset: miles and points,” Conway said.
Looking ahead
Hayes has no plans to move to a more cosmopolitan or traditionally entrepreneurial zip code. There are a lot of resources and opportunities in The Research Triangle. It is Jonathan’s home. He loves the great quality of life, the low cost of living and the modern, socially-conscious environment.
“In Silicon Valley you can’t buy food and groceries with shares of your company,” he said.
Jonathan wants his children to grow up believing that anything is possible for them. He reads his 3-year-old daughter the children’s book “Rosie Revere, Engineer.” There’s one line he makes sure to stress:
“The only true failure can come when you quit.”
Edited by Paige Colpo and Bailey Aldridge.