Text Pay Me Chief Executive Philip Yuen just sent $1 to my cell phone in an attempt to show how easy it is to pay people through text messages on mobile phones. Unlike many demos, this one actually worked and within a matter of minutes I had a text message from Yuen saying "You got Money!"

The demonstration followed Yuen's talk today at the Wireless Ventures conference in which he discussed the Redmond company's prospects, saying that Text Pay Me is experiencing "exponential growth" as it targets 18 to 34 year olds with a service that allows people to "pay anyone, anytime, using any device."

Yuen also spent some time talking about how Text Pay Me is trying to compete against PayPal, the 800 pound gorilla that introduced its mobile payment technology in March.

"The way we see ourselves being different is being more open with users," said Yuen, who declined to say when the service would officially go live. "We take the cue from our users... We have a better pulse of where our users want to be and we are going to use that to our advantage."

By being nimble, Yuen said the 3-person company hopes to evaluate emerging business models and quickly implement them before the competition arrives. One of the ideas that has been discussed is a business that allows people to conduct mobile payments among friends for free, with a transaction charge occurring if a payment is sent outside that social network. He also said the company has been toying with the idea of subscriptions and possible partnerships with financial institutions.

Still, PayPal Mobile was on Yuen's mind and many of the questions dealt with the online payments giant.

Yuen opened his talk by saying that three months ago people were questioning whether there was a market around mobile payments.

"Three months ago I would have told you that we were the only mobile payments system," he said.

That certainly has changed.