Online checkout experiences have become increasingly complicated and fragmented. While many companies are focused on improving the current systems, few are daring enough to rethink the process from the ground up. OneText is doing exactly that — offering a new approach that allows consumers to complete purchases simply by sending a text message.
Founded by former PayPal employees, OneText has just raised $4.5 million in seed funding, with backing from Khosla Ventures, Coatue, Citi Ventures, Y Combinator, Good Friends (a fund created by the founders of Warby Parker, Allbirds, and Harry’s), and Matt Bellamy, the lead singer of Muse.
Jonathan Fudem, co-founder and CEO, came up with the idea during his time on PayPal’s checkout team, where he observed that even startups with excellent UX often struggled to persuade merchants to replace their existing payment systems.
“That’s a tough pitch,” Fudem said. “Many merchants don’t even get to choose their own checkout provider — that’s typically dictated by their e-commerce platform.”
By enabling purchases through SMS, OneText eliminates the need for merchants to overhaul their existing checkout flows. And while platforms like Instagram and WhatsApp offer built-in commerce features, Fudem believes that brands still need to maintain direct, controlled relationships with their customers.
OneText positions itself not as another SMS marketing service — known for generic mass messages and spammy links — but as a smarter alternative. It combines AI-driven two-way messaging with human oversight to increase conversion rates by 20–30%. Features like cart recovery, personalized product recommendations, and post-purchase upselling contribute significantly to these results.
Behind the scenes, OneText operates its own digital wallet, which integrates with merchants’ existing payment processors. Once a customer makes their first purchase, their payment details are securely stored. Every future purchase can then be completed with a simple text reply — essentially mimicking the “charge it to my room” convenience found in hotels.
To ensure transparency, OneText uses what Fudem calls “consentful automation”. When a customer places a repeat order, the system sends a message letting them know the payment will process in 24 hours unless they opt out. The default is passive approval.
Looking ahead, OneText plans to expand its network, allowing shoppers to use their stored profile across multiple brands — with prefilled checkout data and more accurate recommendations — effectively creating a cross-brand, SMS-native payment ecosystem.
“Building a 10x better consumer wallet is incredibly hard,” Fudem said. “But we can create a business-to-consumer texting experience that brings that same ‘charge it to your room’ ease — except now, it’s tied to your phone number. That’s how we build the network.”
OneText graduated from Y Combinator in 2023 and has been quietly developing its platform ever since. Today, the company serves mid-sized e-commerce brands with annual revenues between $10 million and $100 million, while also supporting smaller startups and large-scale enterprises.
“We’ve been growing 3x year-over-year and generating millions in revenue,” said Fudem, who co-founded the company with CTO Daniel Brain.
