Apple rumored to have engaged troubled payments startup Clinkle in acquisition talks

Sources close to the matter told TechCrunch that Duplan's failure to inform employees about Apple's interest in Clinkle was just one of many recent problems for the company, which has yet to produce a viable product since its founding in 2011. Clinkle made headlines in 2013 after landed more than $30 million in funding from big-name investors.

The startup initially focused on an ultrasound-based mobile payment technology, but after years without a tangible product, Clinkle pivoted to a debit card system called "Treats" that pays out lottery style rewards. Not yet available publicly, users are issued special cards that accrue Treats every seven purchases. This Treat is then sent to a friend who has the chance to be reimbursed up to $25 on their next purchase.

Apple reportedly met with a team from Clinkle in February to assess the viability of integrating the rewards system technology into Apple Pay. The team also met with Google, but the search giant was reportedly not interested in pursuing an acquisition. According to the report, Apple, Google, Amazon, Samsung and Visa all showed interest at some point.

Duplan supposedly kept employees out of the loop, dangling hope of an acquisition by a major tech player as incentive to stay. Duplan was still name dropping Apple to keep employees motivated months after the February meeting, prompting some to suspect he rejected an initial offer as too low. Two high-level executives were supposedly fired after making inquiries into the rumored Apple deal.

Over the intervening weeks, Duplan abandoned the debit card platform in favor of a mobile API for business-to-business rewards in a bid to gain leverage over Apple, the report said. The idea was that Apple would have to acquire Clinkle if it didn't want the technology to go competitors.

With respect to [M&A], I can't confirm or deny that any conversations have taken place or are taking place. Secondly, today we indeed did have a planned staff restructuring, and that's actually part of a greater reorganization and cost abatement plan which we've been looking at doing for a while now.

And then finally...the level of consumer engagement around the card specifically has not gained the traction quickly enough for us to continue pusuing [sic] it. That being said, the Treats concept shows terrific promise, and so what we're focusing on right now is what's the best way to actually commercialize that.

Rumors that Apple would roll a rewards system into Apple Pay hit shortly after it launched last October, with some speculating the feature would help the service stand out in the nascent payments sector.