The Future of Payments

Today we'll hear from company president Celine de fatel who will tell us about How checkout.com is still in growth mode And that it has its eyes on the US Please welcome to the stage saline and Or moderator Christine Hall [Music] Great so thanks so much Celine for being Here thank you for having me yeah so it Seems like stripe had figured out the Online payments sector but then a decade Ago checkout.com you know appears out of Nowhere and you've now you know fast Forward to today you've now raised over A billion dollars and you've carved out A place for yourself by going after big Clients like Netflix and farfetch while Stripe focused on you know consumers and And small Merchants so therefore you Know some people like me and perhaps the People in our audience might not exactly Know who checkout.com is so tell us a Little about what you do sure Um so we are a Global Payments platform Um we own our technology and have built Our technology end to end right so it's All our proprietary Tech stack Um and we are you know we provide direct Integrations into the schemes and of Course alternative payment methods all Over the world Um we're a regulated business right as We move money Um all over the world like you mentioned

We focus on the Enterprise segment Um and you know we really pride Ourselves on solving really complex Payments problems for those global Enterprise Merchants Um we recognize that you know there's Constant innovation in the payment space There's a lot of different regulation All over the world Um there's lots of different payment Methods all over the world and so we Help abstract the complexity of payments For those global Enterprises and really Focus on driving top performance of Payments for those businesses okay and You know since you know the company is Compared to stripe quite often Um is the going after the big Enterprise Clients is that still kind of your Unique Unique selling point or have you evolved Into other other areas since then that Have Um so that you're able to stand out a Little more yeah so we we continue to Focus on the Enterprise segment Um but we you know we've continued to Expand our capability and you know over The course of this year Um you know we've been doing a number of Things first is we've been fortunate to Drive really fast-based crows serving Our core Commerce and fintech clients so You know over the course of this year we

Grew over 40 percent Um which we're really excited to to be Able to do and and going live with some Great names all over the world right so Whether it be StubHub or G Healthcare or Aunt Alibaba or vintid in Europe we Continue to work with those Merchants Grow with our Merchants but also Beyond Enterprise acquiring we went live with Four different new capabilities this Year Um so we introduced issuing which is the Ability to issue both virtual as well as Physical cards uh intelligent acceptance Which is our machine learning Optimization engine to drive very high Performance and payments but as well as Integrated platforms which is our our Marketplace capability and then last but Not least identity verification We were very excited about a year ago to Acquire a startup called able in the Identity verification space that works With great names like DocuSign and Ubereats and we've been excited to Expand their capabilities this year and Launch some new capabilities with them Oh that's great and plus you've taken on A new role as president now so how's That going that's that's a big jump It's been a busy year between the new Products that we've launched we also Went live in Japan in addition to just You know a lot of my focus is on helping

Our core functions scale so that we can Continue to grow with our Merchants While we abstract all the complexity in The background for them right we're Again we're a highly regulated business So you know my teams across Finance our Treasury operations compliance risk our Client operations we're always working In the background to make sure that we Can provide great service to our Merchants but we also have a platform That truly scales with the kind of Complexity that that we have in the Background okay and and some of the the Enterprise success that you've had has Come from working with companies that Are in the crypto space Um you know like blockchain.com or Moonpay and circle Um you've also told colleagues you know My colleagues that you know web3 has has A lot of Market opportunity what Percentage of your business at this Point is crypto Yeah so today Um we so we we serve crypto exchanges Just to be clear we don't actually touch Crypto right so the service we're Providing to crypto exchanges is Essentially the same service we provide To our e-commerce merchants or streaming Merchants or gaming Merchants which is a Credit card transactions Um so our crypto exchanges today

Represent a little under four percent of Our total processing volume Um so it's actually a Modest part of the Platform Um you know that said we are we do serve A lot of fintechs as well so kind of More broadly in the remittance space Bnpl Neo Banks Um and I think look I mean we we believe In the utility of web 3 and blockchain Long term we also believe that a lot of You know a lot of regulate the movement Towards regulation is also much healthy And much needed yeah yeah that's kind of What I wanted to ask about as well with You know the checkout.com kind of Famously cut off binance Um recently take us into the boardroom Like what you know how how did you make That decision to do that Yeah I mean as a you know as a again as A regulated business and Um you know with the complexity that we Deal with we take risk management very Seriously and time to time that leads us To reevaluate some of our relationships Or look through our our portfolio yeah You know ultimately when we make a Decision to to terminate a relationship With a merchant as you can imagine we Take that very seriously it's something That we heavily scrutinize and we really Think through ultimately we make Decisions in the best long-term interest

Of checkout and that's how that decision Was made okay and how did you tell them How what was that conversation like when You were telling binance about about That that you weren't going to work with Them anymore you know we we have very Good relationships with all our Merchants over multiple years ultimately We have clear contracts with them around Their rights and our rights Um and everything that we do follows the The you know the contractual Relationships that we have with them got It after that happened did you receive Calls from other clients that were in The crypto space You know our we have again we have very Good relationships with our Merchants You know one of the things that we Really focus on is is service Um and especially so sophisticated Enterprise Merchants I think they like To interact with sophisticated payments Professional and it's something that we Really pride ourselves on in terms of How we we deal with them and same thing In the crypto space we're very close to Our to our clients they know why we make Decisions they know that we have Long-term Partnerships with them and They know that sometimes we have to make Decisions as a business yeah and to your Point about the you know the the Regulations and things like that has

That you know have you had any Conversations about you know considering With you know saying talking about Binance have you had any conversations About whether to work with crypto Companies at all Um you know we first of all I think it's Really important for for any business And we definitely think about it our Business to be Diversified across you Know different set of Industries right So we serve as I mentioned earlier we Serve a number of fintechs we're active In the in serving Neo banks in serving Bnpls Um we're active in the traditional Ecom Space we serve streaming companies we Also participate in the gaming and Sports betting industry we participate You know we serve you know either ride Hailing or food delivery you know so we Have a broad range of industries that we Support we definitely of course ask Ourselves for any vertical that we go Into what are the kinds of reputational Risk AML risk um that that we take going On in the vertical and we don't make Decisions lightly ultimately though I Think decisions at a merchant level are More important that uh than at a Vertical level especially in a complex Space like crypto where you're really Looking to see how how are those how are Those organizations running themselves

Essentially got it got it well back to Checkout.com Um you know you you raised a billion Dollars Um a series D at the beginning of the Year and you're valued at 40 billion Dollars and then by the end of the year You and some others had had to you know Kind of Have a re-evaluation of the valuation And it ended up being around 11 billion Dollars given that the bottom kind of Fell out of the crypto space at the same Time do you feel like that was because You had some on your books do you feel Like that was at all a factor in the Devaluation Look I think Um you know the change in valuation in The fintech space is not going to be an Aha moment for you know anybody in the Audience and of course check out you Know is not immune to changes in Evaluation like like anybody else I Think for us what matters is really Staying focused on the long term right Like we believe in you know focusing on Things such as what's our Differentiation what's our positioning In Market do we have true product Market Fit are we helping our Merchants grow Um and driving sustainable growth which You know that's why we were so excited This year you know as as there was sort

Of Doom and Gloom around e-commerce that We were growing 40 percent Um in that vertical with our you know Across fintech and e-commerce with with Our Merchants so again we focus on the Long term and the and the quality of the Value proposition because that's what Will determine long-term valuations I Also think you know just from an Employee standpoint Um you know reset evaluation has some Benefits in the sense that we're also Able to issue options that are lower Strike rights which means you know more Upside for employees and you know that's Something that's obviously valuable to Them it's great yeah and the company has Had raised it looks like every year you Know since 2019 but then you've got You've stopped at the beginning of last Year Um And you haven't raised essentially in About 18 months or so at this point are You raising now or looking to raise no Not at all okay no so um you know the The company was really bootstrapped from From its founding and so 2019 was the The first year that the company took Outside funding and you know it it was Really about accelerating the growth of The business which you know we feel good About where we are now we don't have any Reason uh or need to to look for funding

At the stage we're really focused on Executing for the business and driving The kind of growth rate that we Experienced over the last year on a Sustainable basis how about an IPO is That in your future No you know we I mean I of course watch What's happening in markets right and We're very interested obviously Instacart and to watch what's happening As an indicator of where markets are at And where investors are at actually when We did our series d one of the things That was important for me was to bring In some Public Market in investors you Know that do kind of pre-ipo late stage Investing because I think it brings kind Of a different perspective to to the Organization and some of the rigor you Know on on your way someday to be a Public company but you know as a very as A highly regulated and complex business I think that you need to be really Really ready when you go public and Sometimes I make this joke it's not About the wedding it's about the Marriage right it's not about the moment Of the IPO it's about being successful Long term in public markets and so for Us it goes above and beyond you know Financial controls and socks and all That but it goes into everything that Touches our regulatory or compliance our Risk our operations

Um and we really have no pressure to go Public so at some point yes but Certainly not in the near future okay And speaking of the the current you know Economic climate that we're in there's Been a lot of mergers and Acquisitions In the in the payment space which your Take on that yeah so we compete with a Lot of companies that in many ways have Been built through Um years of m a right so and and Multiple platforms being put together And what we hear from our Merchants is It often leads to quite a clunky Experience because you know they feel Like they're interacting with one one Organization but in reality or they Think they're interacting I'm sorry with One organization but in reality they're Really experiencing multiple platforms So multiple Integrations you know Different reporting different data and It's really far from being a seamless Experience and so that's something that We pride ourselves on with our Proprietary end-to-end technology all Over the world single API single Integration consistency of of the of the Experience I also think when you build through M A And you have a lot of different Platforms it makes Innovation harder and Slower because as a new regulation comes In or new payment method comes in you're

Finding yourself having to make changes On a much broader ecosystem to to keep Up that being said we believe in m a When it comes to adjacent capabilities Okay so if it's you know something that Doesn't touch kind of our core acquiring Platform but is a value-added service That our Merchants are looking for that We can provide to them that's why we Were excited to buy a startup for Instance in the identity verification Space we think that's a really Interesting segment in terms of digital Identity and and digital identity Verification in the future and very Relevant in various parts of the spaces We we work in whether it's it's Ecom or It's fintech or it's it's gaming so I Think I think for me m a it just really Depends what the intent of the m a is And with the with doing all of that Identity verification and things like That what Um where do you see that kind of being Used in in checkout.com like you know Essentially like what's next for you You've gotten all those things that you Have come out with you know in the past Year you know what's next for Checkout.com Yeah so uh I think for us Um two things you know one is continuing To uh continuing with a pace of growth Which

Um you know actually in the back Requires a lot of work uh to make it Happen across the world and growing with Our Merchants growing our share of Wallets against our competitors and then Also being able to attract new new Merchants to our platform Um but also being really able to scale Those new capabilities so you know Identity verification issuing Intelligent acceptance integrated Platforms these are all capabilities We're really excited about and we want To we want to continue to grow including Continuing to grow in the U.S so you Know our roots are are in Europe we are We have a very strong uh capability and Presence in the Middle East Um we also have really strong Relationships in APAC and the US is sort Of in some ways the most recent Geography that we've really invested in From a commercial standpoint with some Really exciting Um uh relationships Um a couple of great go lives this year With G Healthcare and StubHub but also Really excited with some some new Opportunities Um uh that we've recently uh agreed to And and hopefully will go live soon Um in terms of the the future Capabilities that are the capabilities That you just talked about what are some

Of the challenges that are going to be Involved in implementation do you feel Yeah so I think the the the hardest part Is how do you say agile and Nimble as You grow and become complex right so and And also kind of that that transition From a startup that's moving incredibly Fast but also not doing everything in The most buttoned up way yeah and Finding your way to to you know kind of That teenage or early adulthood where You know some things are done in a in a Slightly more more structured way so That's the balance that we're you know Always trying to to strike and where a Lot of my teams Um get involved I think you know it's to Me it's really important that we have Excellent cross-functional collaboration Okay Um we you know especially for me our Finance team our treasury teams are Deeply embedded in the products we Develop Um and one of the things that we really Try to make sure is that we've got the Right velocity in those teams as we Develop new products okay okay Um and To your point about you know working Um in the more in the U.S and other Places where do you what do you see as The kind of differences between working In the US or creating products for the

US versus say you know you've gone into The Middle East now like what are some Of the differences of of trying to you Know operate in those different types of Areas yeah Um well there's there's a lot of Different nuances you know of course Regulatory expectations can be different How the licenses are are given what they Entail what the expectations of Regulators are there's obviously Differences in local payment networks That we integrate into but it's also of Course payment methods right so Adoptions of alternative payment methods Can be different across the world if you Go to Europe if you're in the Netherlands you know 70 of e-commerce is Going through ideal or in Sweden through Swish or you know obviously Brazil with Picks UPI and India there's a lot of Nuance all over the world Um but again this this comes back in Many ways to our core value proposition Which is to abstract that complexity for The big platforms we work with so that You know they can drive the best Acceptance rates and performance you Know wherever it is that they want to do Commerce all over the world okay great And you know speaking of that you being In the the payments processing space you Are in a unique position to see the the Payment numbers that flow through your

Clients Um are you seeing in terms of the the Payments flowing through those clients Are you seeing those payment numbers Going up or down Yeah you know we um uh we continue to See our Merchants grow Um of course there's nuances right Certain geographies or certain segments But we serve a pretty broad range of um Of Industries Um and we continue to see demand across The board I think for me one of the Things that was a bit overblown in 2023 Was that fear of Ecom really slowing Down right I mean yes it has you know Slowed down relative to the pandemic but I think I think you need to stay focused On the long-term picture which is Um we really believe in the continued Digitization of payments okay we think It has a long run way to go we think There's a lot of interesting verticals That are growing really fast you know Again it's not just kind of Ecom but There's gaming there's streaming there's All sorts of different uh experiences And then I think fundamentally there is A blurring of the line between an In-person experience and the digital Experience right more and more you'll go Online pay for something that you go Pick up somewhere or you'll go online Pay for an experience that you'll go

Experience somewhere yoga class Something like that so I think the use Cases of digital payments will continue To explode over the next you know decade And I'm really excited to see continued Innovation in the space well great and We're excited to see what Innovation Comes out of checkout.com too thank you So much for being here thank you Appreciate it thank you it was pleasure Thank you [Music]