53°N talked to Gijs op de Weegh COO of Payvision
Sixteen years ago, Rudolf Booker decided to start a business in payment processing. And so, Payvision was founded, right after the dot.com boom in 2002. Shortly after, Gijs joined Rudolf in his adventure.
It was a time when there were no VCs and angel investors throwing money at the next big idea. How did they manage you wonder? As Gijs said “We focused on keeping the business alive. Our main goal every day was to find a solution to make money, which really drove some creativity!”
It took thirteen years of hard work, iterations and surviving before Gijs felt like the high risk of running a start-up had subsided enough to breathe easily. He credits Payvision’s success to the co-founders’ complementary skills and ability to play devil’s advocate with each other, testing their strategic decisions. They were united by their conviction that together they would always find the right solutions for the company. This strategy has paid off for Payvision, which was valued at €360m earlier this year when ING acquired a 75% stake in their business.
Being able to navigate those strategic decisions has been critical to Payvision, which has developed steadily over its lifetime.
In 2002 the payments ecosystem in Europe was fragmented, with activities like fraud and risk management still managed in-house by banks, and no single provider offering a complete payment service solution. The US was already ahead in this regard and Rudolf saw an opportunity to bring their model to Europe.
In 2005, after opening an office in New York, they began focusing on building Visa and Mastercard acquiring propositions. They strived to better understand the model that the US independent sales organisations focused on, delivering total solutions to banks – not only the payment gateway, but also reporting and assessing liability and risk management.
Payvision went on to develop its own full-service product for banks across Europe, Asia and the US, making them one of the first global acquiring networks that provided cross-border transactions on one single payment platform. By staying focused on this proposition and as Gijs said, “striking a balance between investment, risk appetite and reward,” Payvision was able to achieve consistent year on year growth (15-30%) and build a solid company.
How to scale
By 2014, Gijs recognised that without further developing the business model they would never be able to drive exponential growth of 100% upwards. This led to a critical turning point for the company; whether to exit or further develop their product to be able to sell directly to merchants. This would mean the creation of a global omnichannel PSP (Payment service provider), a service that simplifies payments and increases conversion rates for merchants.
And so, in early 2014, Acapture, a new subsidiary of Payvision, was built. It wasn’t an easy decision, but the team believed there was much untapped growth potential to exit at that point.
Building Acapture required hiring top developers and professionalising the company. It took two years to build it up and increased Payvision’s year on year growth to upwards of 60%. With the move into a full-service PSP paying off, the company took stock of how to scale further. Gijs emphasized the importance of being aggressive in investment and sales, if you are serious about growth and its accompanying risks.
This led to their first funding round registering a lot of investment interest especially from private equity. ING, a Dutch bank in the top 10 in Europe, however proved to be the best-suited investor leading to their 75% stake acquisition in Payvision. Unlike typical private equity offers, ING agreed to keep the governance with the founding team despite their minority stake. It is a deal that will set the company up well for the next chapter in its growth.
Staying in control
Payvision’s success is largely due to its cofounders’ determination, smart strategic choices and staying in power. Founded in a time when the world was not friendly to start-ups, they were able to retain 100% of their company up until the time when scaling and investment was the smart option.
We discussed the transformed landscape with Gijs, who as an investor himself is familiar with the array of start-up investment routes. His advice? “If you do it today you have unlimited access to capital. Don’t give up too much. Stay in control of your business.”
And finally, our two wacky questions..
If Payvision was an animal what would it be? “An Eagle – sharp eyed.”
And if you could hire anyone in the world to work at Payvision who would it be? “Barak Obama, such a well-respected influential person with a strong network.”