After writing earlier this week about Why LevelUp Works, the question on our minds was How does LevelUp scale? Specifically, we wanted to know how LevelUp planned to go from a sleek, niche app for early adopters, to a major payment mechanism used at places like Walmart.

So I went over to LevelUp/SCVNGR’s new office in Government Center to put that question to John Valentine, VP of Sales, and to hear the company’s vision on mobile payments in general.

Not surprisingly, LevelUp is thinking hard about the Walmart’s and the Target’s of the world, and it believes that both will be developing their own brand specific mobile payment apps. Just as brands like Macy’s push their own credit cards, the big retailers want to get out from under credit card fees, as well as to collect valuable data about their customers.

For LevelUp, then, the challenge is to get big enough fast enough so that Walmart and Target can’t ignore them. Valentine likened that goal to American Express, which restaurants don’t dare not accept.

“We’re building something you can’t avoid,” he said.

To do that, they need users. Lots of them. That’s the purpose of the Give $5. Get $5. program whereby users attract others to the app in exchange for a $5 reward when the new user makes his or her first purchase. Generally, LevelUp is willing to pay up for user acquisition, on the assumption that the hardest thing for them is to get customers to actually download the app and make their first purchase.

But more customers requires more businesses accepting LevelUp, and the company has a plan for that too. They’re expanding their focus on small businesses to include franchise owners, like someone who owns seven Dunkin Donuts, for instance. They believe selling to franchise owners will step up the rate at which businesses come on board. LevelUp is also expanding to new cities, and experimenting with launching a city without sales boots on the ground, which would allow them to scale faster.

Beating Walmart and Target to the punch on how customers pay in their stores is ambitious, but LevelUp is counting on the fact that, just like customers don’t want a dozen loyalty cards or credit cards, they’ll prefer to make their mobile payments through just one app.

Ultimately, LevelUp is betting on the value it can provide to businesses via its customer analytics. I got a peek into how those work, but that will be the subject of a future post.