When A Program Wants To Reward You Too Much – You Let Them

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Sometimes a question really just gets it. Is the Bilt World Elite Mastercard too good to be true?? How can they make money giving so much to cardmembers?

How is Bilt in Business???
by u/jbs170 in CreditCards

Let’s try to work through this, noting that I’m doing some speculation here. But first the key value propositions.

  • Targeted offers: They keep sending out great offers, like regularly targeting new Bilt World Elite Mastercard cardmembers to earn 5 points per dollar for 5 days up to 50,000 bonus points. I received an offer of 5x on food delivery, internet and Amazon for two months. For Black Friday Rent Day was 5 days and let you earn 50,000 bonus points.

    I’ve taken advantage of offers since getting the card and I’m well into a six figure account balance – with a goal of building to seven figures like I have with Chase and Amex.

  • Additional ways to earn in the program: like earning points for Lyft rides (they’re the most lucrative Lyft partner for this in my view) and a new dining program to earn 5x points at restaurants on top of your usual credit card earning and that stacks whether you have a Bilt credit card or not.

  • Great redemption options: You can redeem for rent or Amazon (please don’t, too many more lucrative ways to use your points) or use points towards paid travel at 1.25 cents per point, even on Disney which most travel portals exclude, though my favorite is points transfers.

    Bilt is the only program with American AAdvantage as a transfer partner, and they’re unique in having both American and United. Plus they have Air Canada and Turkish in Star; Briitsh Airways, Iberia and Cathay Pacific (lower fuel surcharges on BA) in oneworld; Air France KLM in SkyTeam (the only good SkyTeam program tbh); plus Aer Lingus; Emirates; Hawaiian; Virgin Atlantic. And for hotels they have IHG and the single best hotel points transfer, Hyatt.

    So the question is a genuine one. Aren’t they giving too much to the customer, how can they make money? I’ve seen their founder Ankur Jain report in interviews that they are profitable today – so the money they’ve raised (they’re the fastest company ever to earn a $1.5 billion valuation as far as I know) is for growth.

    Chase Sapphire Preferred is a profitable product. Chase Sapphire Reserve isn’t. Bilt is going to have a lot of high cost redemption options, where cardmembers really benefit, and they don’t have annual fee revenue. But they also have an off ramp where a program designed for renters allows cardmembers to redeem for rent – that and Amazon are low cost redemptions for the program. The more people who do that, the lower their costs, the better the economics. Benefits like Lyft earning are presumably being funded by Lyft, rather than by Bilt.

    And while awarding points for rent costs them money on the points, they can’t have the usual costs for credit card processing on those payments. Indeed, what tells us that the economics works out well for them here is that they’ve just recently doubled the limit on the number of points you can earn on rent per year from 50,000 to 100,000.

    I’m not a renter and I have and use the Bilt World Elite Mastercard. That’s because this is the most exciting program to engage in, with regular new features and benefits and new promotions like 100% transfer bonuses.

    The value from this card and this program is incredible, and when a company wants to give you this much outsized value that members wonder how they can do it without hemorrhaging money you take advantage of that while it lasts. It does seem that they manage to make the economics work, which just suggests that outsized value can continue once you get their card.