Coinstar
{{short description|American company with a network of coin-cashing machines.}}
{{Infobox company
| name = Coinstar, LLC
| logo = Coinstar logo 2011.svg
| logo_size = 250px
| type = Private
| traded_as =
| genre =
| foundation = {{Start date and age|1991|02}} (as Coinstar, Inc.)
Bellevue, Washington, US.
| founders = Jens Molbak, Aaron Finch, Dan Gerrity{{cite web|url=http://www.allbusiness.com/4353872-1.html|title=All Business interviews Coinstar founder|access-date=2009-12-09}}
| location_city = Bellevue, Washington
| location_country = US.
| location =
| former_names = Coinstar, Inc. (1991-2013)
Outerwall, Inc. (2013-2017)
| locations =
| area_served = North America, Europe
| industry = Entertainment, DVD rental, coin counting machines, mobile product recycling
| services = Coin counting services
E-payment services
| revenue = US$ 1.85 billion (2011){{cite web|url=https://www.sec.gov/cgi-bin/viewer?action=view&cik=941604&accession_number=0001193125-12-049236&xbrl_type=v#|title=US SEC Form 10-K|access-date=2012-02-11}}
| operating_income = US$209 million (2011)
| net_income = US$104 million (2011)
| assets = US$1.48 billion (2011)
| equity = US$531 million (2011)
| owner = Apollo Global Management
(2016–present)
| num_employees = 400+ (2020){{cite web|url=http://hoovers.com/company/Coinstar_Inc/hykfhi-1.html|title=!company_name! - Company Profile from Hoover's|publisher=}}
| parent = Apollo Global Management
| key_people = {{Unbulleted list|Jim Gaherity (CEO)}}
| divisions =
| subsid =
| homepage =
| footnotes =
| intl =
}}
Coinstar, LLC (formerly Outerwall, Inc.) is an American company operating coin-cashing machines.
Coinstar's focus is the conversion of loose change into paper currency, donations, and gift cards via coin counter kiosks which deduct a fee for conversion of coins to banknotes; it processes $2.7 billion worth of coins annually {{As of|2019|lc=yes}}.{{cite web |last1=Smialek |first1=Jeanne |last2=Rappeport |first2=Alan |title=A Penny for Your Thoughts Could Be a Lot Harder to Find |url=https://www.nytimes.com/2020/06/25/business/economy/coin-shortage-coronavirus.html |work=The New York Times |access-date=26 June 2020 |date=June 25, 2020}} The company also operates Coinstar Exchange for gift cards. Coinstar's kiosks are in the front of stores (between the cash registers and the exit/entrance). The company has more than 60,000 kiosks offering a variety of services in the US, UK, Canada, Puerto Rico, Mexico, and the Eurozone. Coinstar also produces machines that provide prepaid credit cards and e-payment kiosks.
On July 2, 2013, Coinstar changed its name to Outerwall and started trading on the NASDAQ as OUTR.{{cite web | title=Outerwall To Celebrate Its New Name, Ticker And Logo At The NASDAQ Stock Market | url=https://finance.yahoo.com/news/outerwall-celebrate-name-ticker-logo-100000881.html | access-date=Oct 3, 2013}}
On September 27, 2016, Apollo Global Management, LLC acquired Outerwall, Inc. and de-listed from NASDAQ. After the acquisition, former components of Outerwall—Redbox, Coinstar, and ecoATM (which includes Gazelle)—became separate business entities.{{Cite web |title=EX-99.2 Outerwall Inc. Announces Completion of Acquisition by Certain Funds Managed by Affiliates of Apollo Global Management, LLC |url=https://www.sec.gov/Archives/edgar/data/941604/000119312516721745/d267879dex992.htm |access-date=2022-06-01 |website=www.sec.gov}}{{Cite web|url=https://variety.com/2016/digital/news/redbox-ceo-galen-smith-outerwall-deal-private-1201872578/|title=Outerwall Boots CEO, Names New Redbox Chief in Closing Deal to Go Private|first1=Todd|last1=Spangler|date=Sep 28, 2016|access-date=May 28, 2020}}
History
The company was founded in 1991 as Coinstar, Inc. and is headquartered in Bellevue, Washington.
Outerwall cooperated with the US Mint in the introduction of the Golden Dollar at the beginning of the millennium and encouraged people to use coins rather than notes.{{cite web|url=http://www.usmint.gov/pressroom/?action=press_release&id=128|title=UK. Mint Announces Program To Encourage Citizens To Re-circulate Coins|date=2000-03-15|access-date=2011-02-11|archive-date=2016-08-17|archive-url=https://web.archive.org/web/20160817085210/http://www.usmint.gov/pressroom/?action=press_release&id=128|url-status=dead}}
In February 2009, Coinstar purchased all remaining shares of DVD rental kiosk company Redbox for $175 million from McDonald's Corporation, making Outerwall the sole owner.{{cite web |url=http://finance.paidcontent.org/paidcontent?GUID=7974685&Page=MediaViewer&Ticker=CSTR |title=Finance | paidContent |publisher=Finance.paidcontent.org |date= |access-date=2009-08-01 |archive-date=2010-01-20 |archive-url=https://web.archive.org/web/20100120093252/http://finance.paidcontent.org/paidcontent?GUID=7974685&Page=MediaViewer&Ticker=CSTR |url-status=dead }} Prior to this, Coinstar and McDonald's each owned 47% of Redbox shares, with various other parties owning the remaining 6%.
In September 2009, Coinstar sold its entertainment business, which included skill cranes and bulk vending, to three entrepreneurs, a month after the business was renamed National Entertainment Network.{{cite web|url=http://www.vendingtimes.com/ME2/dirmod.asp?sid=EB79A487112B48A296B38C81345C8C7F&nm=Vending+Features&type=Publishing&mod=Publications%3A%3AArticle&mid=8F3A7027421841978F18BE895F87F791&tier=4&id=EC478EEF95D746F3B287B5A5AA7B455B|title=National Entertainment Network Acquires Outerwall's Entertainment Division|access-date=2011-05-11|archive-date=2016-03-13|archive-url=https://web.archive.org/web/20160313020437/http://vendingtimes.com/me2/dirmod.asp?id=ec478eef95d746f3b287b5a5aa7b455b&mid=8f3a7027421841978f18be895f87f791&mod=publications::article&nm=vending+features&tier=4&type=publishing|url-status=dead}}
=Outerwall=
On June 28, 2013, shareholders voted to change the company name from Coinstar to Outerwall.{{cite web|url=http://www.fool.com/investing/general/2013/06/28/coinstar-shareholders-approve-changing-name-to-out.aspx|title=Coinstar Shareholders Approve Changing Name to Outerwall|author=Rich Duprey|date=28 June 2013|work=fool.com|access-date=21 July 2015}} On July 2, 2013, Outerwall acquired mobile phone recycling kiosk operator ecoATM, for $350 million (not including debt).{{cite web|url=https://venturebeat.com/2013/07/02/coinstar-rebrands-as-outerwall-acquires-phone-recycling-startup-ecoatm-for-350m/|title=Coinstar rebrands as Outerwall, acquires phone recycling startup ecoATM for $350M|date=2 July 2013|publisher=VentureBeat|access-date=July 2, 2013}}
On October 7, 2013, Barry Rosenstein's hedge fund JANA Partners filed a 13D on shares of Outerwall (OUTR) and disclosed a new 13.5% ownership stake in OUTR with 3,777,995 shares. The activist 13D filing indicated that JANA expected to talk with management—in particular, that they wanted to focus on "a review of strategic alternatives including exploring a strategic transaction, selling or discontinuing certain businesses, or pursuing a sale."{{cite web|url=http://www.marketfolly.com/2013/10/jana-partners-goes-activist-on.html#ixzz2n6B8lFlV|access-date=October 7, 2013|title=JANA Partners Goes Activist on Outerwall|date=7 October 2013|website=Market Folly}} Subsequently, on December 9, 2013, Outerwall's former CEO, J. Scott Di Valerio, announced it would discontinue three new ventures: Redbox's Rubi, Crisp Market, and Star Studio, and lay off 8.5% of its workforce.{{cite web|url=https://variety.com/2013/biz/news/redbox-chief-saunders-out-outerwall-to-cut-8-5-of-workforce-1200940217/|access-date=December 10, 2013|title=Redbox Chief Saunders Out, Outerwall to Cut 8.5% of Workforce|date=10 December 2013|website=Variety|last=Spangler|first=Todd}}
=Coinstar=
In late September 2016, Outerwall announced CEO Erik E. Prusch would be leaving the company as part of the company's acquisition by Apollo Global Management. Outerwall's subsidiaries, Redbox, and ecoATM, were separated into stand alone companies as was Coinstar.{{cite news |last1=Levy |first1=Na |title=CEO of Redbox and Coinstar maker Outerwall out as businesses split into separate enterprises following acquisition |url=http://www.geekwire.com/2016/outerwall-deal-new-ceos/ |access-date=October 24, 2016 |work=GeekWire |date=September 28, 2016}}
Coinstar kiosks
{{multiple image
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| direction = vertical
| width =
| image1 = Logo-coinstar.svg
| width1 = 230
| alt1 =
| caption1 = Former Coinstar logo, currently used exclusively for kiosks.
| image2 = Coinstar logo 2011.png
| width2 = 230
| alt2 =
| caption2 = The new logo was launched in 2011.{{cite web|url=http://www.underconsideration.com/brandnew/archives/coinstar_more_coin_less_star.php|title=Brand New: Coinstar, More Coin less Star|author=UnderConsideration LLC|work=underconsideration.com|access-date=21 July 2015}}
| header =
| header_align =
| header_background =
| footer =
| footer_align = left
| footer_background =
| background color = #ffffff
}}
The typical Coinstar coin-cashing kiosk is green (blue in the UK) and the size of a large vending machine. They are located at grocery stores, drug stores, larger merchants, banks or other retail locations. The coin-counting service is available in the US (including Puerto Rico), Canada, the UK, and the Eurozone.{{citation needed|date=January 2013}}
To process coins, loose change is poured into the machine. In the United States, the machine accepts all denominations of coins from one-cent coins to one-dollar coins, its only restriction being 1943 steel cents and Eisenhower Dollars. Likewise in Canada, all denominations are accepted except 50 cent coins, Voyageur Dollars and nickels of tombac and chrome-plated steel (American pennies, nickels, dimes and quarters are also accepted at par.) When the machine finishes counting coins, it issues a scrip, called a voucher, which the user can redeem at the place of business providing the coin-counting service at face value for currency. The same mode of operation and redemption is provided on those Coinstar machines situated in Great Britain, Canada, Eurozone, and Puerto Rico.
The coin-counting processing fee, deducted from the total once coins have been counted, is 12.5% in the US, 11.9% in Canada, 10.9% in Ireland, and 10.9% in the UK, unless the kiosk is located inside a bank branch, in which case this fee will not apply for account holders and the money can be directly deposited into an account by a teller. Some machines may offer a lower rate; in this case the store hosting the machine has subsidized the rate.
A newer service enables users to use their coins to buy a gift card from merchants without the usual fee ("no fee") — including such retailers as Starbucks, Amazon.com, Banana Republic, Gap, Regal Entertainment Group, Old Navy, J.C. Penney, CVS Pharmacy, and Overstock.com. Select grocery retailers, including SuperValu{{cite web |url=http://www.nacsonline.com/NACS/News/Daily/Pages/ND0506117.aspx |url-status=dead |archive-url=https://web.archive.org/web/20110513032543/http://www.nacsonline.com/NACS/News/Daily/Pages/ND0506117.aspx |archive-date=2011-05-13 |title=Supervalu, Coinstar Ink New Agreement}} and Stop & Shop, are also participating in the "no fee" offers. If the user chooses the fee-free option, the machine issues a plastic gift card or, in the case of online merchants like Amazon.com, a voucher with a redemption code valid only for a single use, where after any remaining balance is forfeit regardless of amount.
US and UK users also have the option of donating their change to a selected charity. By 2006, Outerwall has raised more than $20 million for charities including the American Red Cross Disaster Relief fund, Leukemia and Lymphoma Society, and UNICEF's Trick or Treat program.
Outerwall has processed more than 350 billion coins in its nearly two decades of operation, with an average transaction amount of about $38. The largest single transaction was $13,000 in pennies from a man in Alabama.Coin Operated. Modern Marvels. The History Channel.
As of August 2021, more than 7,000 Coinstar kiosks in 46 states were equipped with Coinme, enabling customers to convert cash to cryptocurrency.{{Cite web|last=Stacom|first=Don|title=Coinstar bringing bitcoin buying to grocery stores across Connecticut|url=https://www.courant.com/news/connecticut/hc-news-bitcoin-at-coinstar-20210708-nlrrxz3defg7lditoqfu5gcjle-story.html|access-date=2021-10-24|website=courant.com}}
Competition
In some sections of the UK, regional banks have begun offering free coin-counting services in the amount of a gift card.{{cite web|url=http://www.coinstar.com/us/WebDocs/A1-0-3-1|title=Coinstar: Cash in coins. Sell gift cards.|work=coinstar.com|access-date=21 July 2015}} Refunds are often given in cash rather than in the form of a gift card. In some cases, it is not even necessary for the customer to have an account at the bank; the free service is offered as a way to attract new business from individuals who are not current account holders. TD Bank's "Penny Arcade" coin counters were free and available to both customers and non-customers in many branches, but as of November 2010, the bank charges a 6% fee for non-customers to use the machine.{{cite news| url=http://www.bizjournals.com/philadelphia/blogs/law/2010/11/td-bank-drops-free-coin-counting-for.html | first=Jeff | last=Blumenthal | title=TD Bank drops free coin counting for noncustomers | date=2010-11-18}} In May 2016, in the wake of a New York state lawsuit over accuracy, TD Bank said that it had suspended use of its Penny Arcade machines and would be removing them from all of its locations.{{cite news| url=https://money.cnn.com/2016/05/20/pf/td-bank-penny-arcade-coin-counting/index.html | first=Chris | last=Isidore | title=Horror! TD Bank dumping Penny Arcade coin machines | date=2016-05-20}}
Publicity
On May 9, 2006, Outerwall sued rival Coin X change over a patent dispute around the use of voucher-issuing machines, remote reporting of the coin machines' status and anti-counterfeiting technology for printed vouchers.{{cite web|url=https://archive.seattletimes.com/archive/20060509/webcoinstar09/coinstar-files-patent-lawsuit-against-coin-x-change|title=Business & Technology - Coinstar files patent lawsuit against Coin X Change - Seattle Times Newspaper|work=nwsource.com|access-date=21 July 2015}}
To generate publicity, Outerwall offered to cash in over 1.3 million pennies collected over four decades by Flomaton, Alabama resident Edmond Knowles after Knowles's bank refused to cash them in. The armored truck sent by Outerwall to Knowles's home sank into the mud in his yard after being loaded with the 4.5-ton collection, and needed to be rescued by a tow truck.{{cite news |first=Jeff |last=Donn |title=Do Pennies Still Make Sense? |url=https://www.washingtonpost.com/wp-dyn/content/article/2006/07/06/AR2006070601423_2.html |work=In The Loop |publisher=Washington Post |date=2006-07-07|access-date=2007-10-28 }}
On March 14, 2008, an employee was arrested for stealing $441,000 from Coinstar machines in Washington, Oregon, and California. The employee was accused of illegally accessing the Coinstar machines' cash boxes ahead of armored car pickups.{{cite web|url=http://seattletimes.com/html/localnews/2004412451_coinstar14m.html|title=Coinstar thefts were inside job, court documents show|work=The Seattle Times|access-date=21 July 2015}}
On March 25, 2008, Roy Disney used his Shamrock Activist Value Fund of Burbank to ask for changes in Outerwall's corporate governance.{{cite web|url=http://seattletimes.com/html/businesstechnology/2004303693_bizbriefs25.html|title=Investment fund seeks Coinstar changes|work=The Seattle Times|access-date=21 July 2015}}{{cite web|url=http://seattletimes.com/html/businesstechnology/2004444739_bizbriefs29.html|title=Coinstar proxy contest resolved|work=The Seattle Times|access-date=21 July 2015}}
Gallery
File:Change machine (419588770).jpg|A Coinstar machine in the United States
File:Coin Star.jpg|A Coinstar machine in Japan
References
{{Reflist}}
External links
- {{url|www.coinstar.com}}
- [https://web.archive.org/web/20080708192645/http://www.startupstudio.com/coinstar-founder-jens-molbak/podcasts/2007/01/05/ StartupStudio] [Archived] In depth interview with Jens Molbak covering the story of how Coinstar began, recommendations for entrepreneurs, childhood experiences that helped Jens succeed, etc. Copy of StartupStudio podcast at [http://www.allbusiness.com/4353872-1.html AllBusiness]
Category:Companies based in Bellevue, Washington
Category:American companies established in 1991
Category:1991 establishments in Washington (state)
Category:Apollo Global Management companies