Sramana: The payment clearinghouse is a very large market with a lot of competition. What did you see in the marketplace that made you believe you could be successful?
Peter Caparso: The nine original members had all worked in the industry and had vast experience. Our collective knowledge led us to believe there were some gaps we could fill. We wanted to address three basic areas in the marketplace.
Areas like PCI compliance are becoming more compliant in the marketplace. Companies trying to focus on their core business to increase revenue yet they have PCI hanging over their heads. To assist those customers, we have a solution where we host the payment page. If the customer chooses to allow us to host the payment page, they can control every pixel of that page. If our customer wants to have a special sale for parts of Europe, we can support their ability to have location-based pricing, and we can even help them to measure the results of that campaign. When we host the page we remove PCI compliance off their plate, and they can then focus on their core business.
A second area we focused on was desktop applet development. That applet was like an instrument gage in a vehicle. It allowed our customers to see their transactions real time. If they rolled a mouse over a particular country they could see the transactions happening in that country in real time. A video game manufacturer wants to know where their traffic is coming from and use tools like that to make decisions. Legacy providers offered only a monthly report which was just a raw data dump. We provided an interactive data push to our customers to help them make better decisions.
Finally, we offered transparency. We sign only one-year nonexclusive contracts with our customers. We knew from our experience working with or at legacy providers that the mentality was to lock customers into a three- to five-year deal. If that relationship went bad, customers had more issues to deal with. We believe that we need to work just as hard to maintain our business six months after the business has been consummated as we do leading up to the initial sale.
Sramana: How many of these features were ready in your initial product version?
Peter Caparso: Candidly, I would say that 65% of the features I just described were available.
Sramana: Now let me go back to the ‘first customer’ question. Who was your first customer, and why did they choose Adyen?
Peter Caparso: There are a lot of payment providers out there. When potential clients look at Adyen, they see us as the new kid on the block. That set us apart in our early days, especially our nonexclusive contracts. That is a major reason we earned most of our first customers.
Sramana: You have described a lot of angles. Did clients go with Adyen for the technology, the real-time views, the nonexclusive contracts, the international marketplace, or the localized currency flexibility? What was your real positioning point?
Peter Caparso: It was a combination of all of that. A lot of payment providers have platforms that were built 15 to 20 years ago. We have a brand-new platform. People chose us because we were a fresh face with fresh technology and business ideals.