“Why I Joined YapStone” written by Bruce Dragt, SVP of Product, YapStone.
With 20+ years in the payments industry, I have been fortunate to build my career at number of amazing companies and gather a significant knowledge base as related to payments, financial services and of course, my passion – product development.
Through a great career at First Data, over 13 years in multiple roles, I had developed extensive global payments experience and worked with a seasoned team at arguably one of the largest payments company in the world.
A few months ago, I recognized that I needed a personal change to drive to my life goals in both business and personal areas and decided to move to the Bay Area.
With this in mind, I gave myself the personal challenge of finding the right role and the right company. The great thing about the Bay Area is the wealth of amazing Fintech companies – all with inspiring leaders, enviable market strategies and innovative products. I felt that any number of these companies could be the opportunity that I was looking for.
As part of this transition, I began to learn more about a payments company that had been on my radar – YapStone. At first glance, I knew YapStone to be a specialized payments provider, focused on enabling payments for the apartment and vacation rental markets as well as being a growing company delivering solid numbers. My impression was that the company had a number of market opportunities and was in the stages to tap its growth potential.
Fast forward and I am now just six weeks into my role as SVP of Product here at YapStone. In this time, I have been diving into the company and learning about its product set and opportunities. I’ve also been able to validate what I felt going in: YapStone is “a diamond in the rough” and committed to offering a unique approach to payments and the markets we serve.
As a payments veteran moving to the Bay Area, the location of a number of amazing Fintech companies, many people have asked, “Why I Joined YapStone?”
Let me tell you.
Solving the Merchant Challenges
First, as sharing economy companies and online marketplaces continue to develop and grow, the need to create an integrated experience for the customer to complete a transaction is core to the overall customer experience.
To add, once a rewarding customer experience is established, it requires the ability to be replicated many times over for both buyers and sellers in order to provide a repeatable and expected experience.
In traditional payments, the concept of “check out” is the center piece of a straight-forward eCommerce experience. Yet, with marketplace companies, it is not about the one-time capture of information for the exchange of goods, but really about creating trust between an ever-changing set of parties, buyers and sellers, who are coming together for the mutual exchange of goods/service, through a transaction.
The integrated customer experience that I am referring to requires that the traditional roles – “Payment Facilitator”, “Merchant of Record”, “Merchant”, “Gateway”, and “Payment Processor” – be re-imagined to become the trusted party that enables buyers and sellers to transact.
In my short time at YapStone, I’ve been amazed to see that the company is already taking on the roles that help extricate marketplace customers from the really challenging elements of payment transactions, like fraud, service for transaction customers, compliance and regulatory issues, and many more.
The major insight for me is that YapStone really understands the challenges that payment providers are facing and assumes the challenges that merchants are facing in accepting online payments. The end result will be the creation of a new model (and experience) to serve the ever-evolving marketplace business model.
Delivering a Customized Solution
In my experience, I have worked with teams to develop simple API’s to accomplish a certain task. This seems like an elegant goal, but I like to pose a new question:
Have we ever stopped to consider what simple means? In this context, it is defined as “composed of a single element, not compound.”
I believe that the world is now heading into more complex challenges, especially at the intersection of Fintech and marketplaces.
The focus at YapStone isn’t to process a transaction through an API that can serve anyone with a generic need for payments, but to provide a customized solution for our specific vertical markets, to meet the needs of the market and respective businesses.
To illustrate, imagine that you have five carpentry projects in your home and you meet with two carpenters: Carpenter #1 comes to your home with one nail. It is a fabulously, simple and elegant nail. And of course, for all of your carpentry projects, the carpenter proposes a solution that involves using that one nail.
Then, you meet with Carpenter #2, who arrives with an entire workshop at his disposal. The workshop includes a large selection of tools, supplies and people – and this carpenter listens intently to the scope of each of your 5 projects. Carpenter #2 consults his experience and creativity as well as the full arsenal of his workshop to deliver five distinct solutions to meet the specific needs of each project.
In thinking about today’s sharing economy, the complex, marketplace business model, applies the approach of “Carpenter #2” to deliver effectively for both buyers and sellers.
To compliment the marketplace business model, YapStone has been very focused on utilizing the approach of Carpenter #2 to develop applicable and customized payment solutions for these customers. This is hard work, but the work that unlocks value. And more importantly, this is the work I am looking to do.
Building the 5th P – Platform
I can imagine that some readers have felt I’ve dropped my “product” title and am really into professional services now. Not the case. Similar to Carpenter #1, who doesn’t invest in new tools for each job, neither would I propose customization of solutions versus the configuration of solutions. YapStone has demonstrated an amazing ability to develop “transferrable IP” and the technology that matches to deliver. The secret here involves carefully identifying the vertical markets to go deep into and really becoming experts. This approach requires patience and commitment to investing the time and energy to getting it right before moving on to the next opportunity. A few examples of past common elements were: 1) the movement from paper checks to electronic transactions, and 2) the transition from off-line transactions to digital, online transactions.
As you may guess, the well-known four “P’s” of marketing, in my opinion, need to be supplemented by another P – “Platform.” In many ways, Platform has now replaced product and supplants price and promotion when it is the only thing that meets the needs of the market served. In turn, today’s marketplace companies then search and find the “platform” solution, which will actually work for their business model.
Growing companies require solutions that work as opposed those that are experimental or proof of concepts. Over the past few years, these companies have partnered with YapStone and, not surprisingly, their business is experiencing explosive growth. As a platform company, YapStone has created and attracted certain companies (partners) that need a customized approach and the 5th P – “Platform.”
Relying on People
People are a huge part of building a great company and being able to do all that I’ve described above. The marketplace business model demands really great carpenters, who rely on creativity and expert knowledge to create the right solutions. All 400+ “Yapsters” (as we are called), from the leadership team to the professionals in each department (engineering, product risk, fraud, onboarding, customer service and many more), are dedicated and committed to delivering on the company’s mission and serving our marketplace partners. It is the people here, with years of vertical market and payments industry experience, who enable the company to deliver on its customer promise, develop the right solution for specific markets, and physically do the hard work and own the operational tasks needed to support it. It’s been a nice surprise to join a company with 16 years of growth and company-building experience that still maintains an entrepreneurial mentality.
The role assumed by the YapStone team extends beyond that of traditional service providers. In the rapidly expanding companies we serve, there is limited interest in building out a team dedicated to solving these challenges – and they turn to YapStone to fill this role. Yapsters deeply understand the verticals and marketplaces we serve. As a result, the ability to provide ‘people-resource’ truly sets us apart from our competitors who simply provide an API, leaving the customer to build specific customizations and figure out how to support the life cycle of the transaction, beyond the technical integration.
Finally, creating a common experience is a challenge for any marketplace to overcome. The network-effect of both the experience and the users credentials make this collectively better when shared. By partnering with YapStone, companies in need of a payments solution can eliminate the challenge of building an expert, in-house team, an endeavor that could take years to staff and scale.
Focusing On Big Opportunities
Fifth and finally, the sharing economy ecosystem I’ve been describing is exhibiting phenomenal growth with no signs of a slow-down in sight. The companies in this ecosystem are building a digital profile that leads to increased trust for all future transactions. I think sometimes when people describe ecosystems or verticals that the image of “small” or “niche” comes to people’s mind. In the case of YapStone, the team has focused on multiple vertical markets, each of which is anything but small. In example, the global vacation market is estimated to be a $500 billion dollar market while the U.S. based apartment rental market is similar in size at $450 billion.
These numbers are reflective of the basic strategy that YapStone has been engaged with since its founding. By actively participating and leading both the movement from paper checks to electronic payments, and the transition from off-line to on-line, the company has taken control of amazing growth levers in these markets today.
So, there you have it – a few reasons why I joined YapStone and why I believe in what we are doing. I’m excited to be part of something new and to make the most of the opportunity. Looking forward to continuing on in my journey of learning, serving and creating value for those of you I have the opportunity to interact with. More to come!