Latest / The Payments Shed / Ep. 68 - LIVE from FTT Payments with Ryft: Beyond the AI Hype - What Businesses Should Actually Prepare for in Commerce

Transcript

Ep. 68 - LIVE from FTT Payments with Ryft: Beyond the AI Hype - What Businesses Should Actually Prepare for in Commerce · The Payments Shed

• 0:05
  Welcome back to the Payment Shed podcast live at FTT Embedded
• 0:09
  finance and super apps. We are joined this afternoon by
• 0:13
  Sadra Hosseini, CEO and Co founder.
• 0:16
  I'm going to say of of Rif Sadra, welcome to the show if
• 0:19
  you're there at. Once thanks Baldwin Littlewood.
• 0:21
  Thanks for joining us. Please can you tell us a little
• 0:22
  bit about yourself, your career in in Fintech and payments and
• 0:25
  and rift as a business? Sure.
• 0:27
  I'm Sadra, CEO, Co founder, as you said, I'm a third time
• 0:31
  entrepreneur. People ask me, is it why, why'd
• 0:36
  you do it? I always say there's there's
• 0:37
  going to be something mentally unstable about you to kind of go
• 0:40
  into this, especially if you were being founder as well,
• 0:43
  because there's easier ways to make make money.
• 0:45
  But yeah, my experience in payments comes from in our
• 0:49
  previous business, we were a marketplace platform.
• 0:53
  We we got into the payments game because we were really
• 0:57
  struggling to find the right, right payment solution to allow
• 1:00
  us to monetize payments. And we saw that there's a big
• 1:04
  opportunity here. So about four and a half five
• 1:07
  years ago we started Rift which was which is the payments
• 1:10
  infrastructure for marketplaces and digital platforms.
• 1:14
  When we scaling rapidly Series B right now and we're going
• 1:19
  international to allow platforms, marketplaces to
• 1:23
  become their own payment process and without getting the licenses
• 1:26
  and the the tech itself. Really interesting because
• 1:29
  there's been a few families I've spoken to that we're in
• 1:33
  businesses where payments was just a real pain in the backside
• 1:38
  for them and their nine set was surely we can do this better
• 1:42
  ourselves, right? We're quite techie like let's
• 1:45
  just go and have a crack at building it ourselves.
• 1:47
  So it's good to hear that you guys are another one that had
• 1:49
  that journey. Yeah.
• 1:50
  And the naivety keeps you going because you're like, oh, it's
• 1:53
  easy. I can, I can do in a couple of
• 1:54
  days or five days. Five years onwards, we're still,
• 1:56
  we're still trying to figure out.
• 1:58
  But yeah, it's I think because payments is so big and it pretty
• 2:01
  much touches every business, there is a niche there that you
• 2:05
  can do better. And obviously we found ours in
• 2:08
  the last few years. So currently there's a a huge
• 2:13
  amount of hype around the genetic commerce.
• 2:16
  What are you seeing in terms of wealthy sooner being out?
• 2:19
  So as you said, there's a lot of hype.
• 2:21
  It's, it's exciting and the future is bright.
• 2:26
  But in terms of actual consumer behaviour, it's still early days
• 2:30
  like we're seeing, we're seeing companies starting to get into
• 2:33
  obviously we we deal with platforms.
• 2:35
  So they're at the forefront of this.
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  They're not your legacy kind of B2B businesses where they, they
• 2:41
  buy supply and sell to, to end users.
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  So these companies that we work with, they're, they're like neo
• 2:46
  fintechs themselves where they're revolutionizing their
• 2:49
  own industries. But yeah, what we found is that
• 2:52
  they're trying to figure this out themselves and they're
• 2:55
  trying to do proof of concepts where they launch a small
• 2:58
  product just to see what the uptake is.
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  But still I would say still very, very early days.
• 3:04
  But we as the as the payments business, we're trying to enable
• 3:08
  these guys to launch those brief of concepts because if your
• 3:11
  underlying solution can't support it, then the end
• 3:14
  endpoint still moot. But yeah, it's, it's coming.
• 3:17
  It's still it's, but it's still very early days.
• 3:19
  That's what we see right now. It's really interesting, I think
• 3:22
  with the, the marketplaces arena because the way payments
• 3:27
  companies are looking at this is like you want the LLM to know
• 3:31
  that, that marketplace is 1 where the payments likely to be
• 3:35
  accepted, right? They have to then have protocols
• 3:38
  or processes probably that are with the underlying payments
• 3:41
  company as well-being a green tick to that LLM.
• 3:43
  Yes, we think if you want to book this holiday for this
• 3:45
  marketplace, you're probably going to get a positive outcome
• 3:47
  here, right? And if you're not head of the
• 3:49
  curve with that, you risk losing transactions because the LLM
• 3:52
  starts going oh, I had a bad experience there last time
• 3:54
  didn't like this booking or this track.
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  Let's go and find another marketplace, right?
• 3:57
  And then the payments provider gets it in the neck, probably
• 4:00
  because the marketplace starts well as the.
• 4:02
  Platform doesn't, the platform's not happy either because like,
• 4:04
  well, because of our payment processor, we've lost these
• 4:07
  merchants now and we've lost that Channel.
• 4:09
  So that's where it's important for us to be ahead of the curve
• 4:13
  so that we allow these guys to kind of go into that market as
• 4:16
  they see it. You think the market's like
• 4:18
  getting ahead of itself though by acting like I think we we are
• 4:21
  doing this in a big way. It's my personal opinion but
• 4:23
  acting like it's mainstream already.
• 4:26
  I think it's more of a probably marketing tool where they're
• 4:29
  trying to the, the newer, newer encomers, they're trying to pull
• 4:34
  customers over to themselves to say, listen, we figured it out.
• 4:37
  It's already huge. Use us to get into that.
• 4:41
  So I think it's more expansion of their town into that market.
• 4:45
  But now is the time to build for it, right?
• 4:47
  Like every, everyone's trying to figure this thing out.
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  It's it's super new. I think just making sure that
• 4:53
  you know, it's not figured out and you need to kind of keep
• 4:57
  that, keep that flexibility and agility both as you're building
• 5:00
  it and as you go into market. Those things are quite important
• 5:04
  on the payment side and the platform side.
• 5:07
  Yeah. So let's say you're a platform
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  trying to figure out what are the signals that you need to
• 5:13
  have before you start building it, Am I right?
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  Is it been the the volume? Is it the demand from your
• 5:18
  underlying customers? Is it the latest model update?
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  What do you think are some of those signals that companies
• 5:25
  should be looking out for for this unbuilding?
• 5:27
  My that. So I think volume is probably
• 5:28
  going to be a lagging indicator. You're, if you're waiting for
• 5:32
  volume, it's probably already too late.
• 5:34
  It's definitely workflows. From from my point of view, it's
• 5:37
  definitely workflow. So as you see, end users are
• 5:41
  finding you in new places in LLMS, AEO, where you see how
• 5:47
  they're going through your journey on on your platform.
• 5:51
  How does that work? So that's the leading indicator
• 5:55
  and that's what you got to build for and give that visibility to.
• 5:58
  So being being discoverable and being in front of the user there
• 6:03
  is super important. One other place that we we see
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  that's quite exciting to get into is obviously we're talking
• 6:09
  about consumer right now, but we're seeing, we're seeing B2B
• 6:13
  start to take off as well. And that's the reason for that
• 6:16
  is the LLMS themselves because we're moving to a business model
• 6:21
  where it's not going to be SAS anymore.
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  SAS is taking a bit of a hit. We're moving into APIAPI hits.
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  How many times have you hit my API?
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  And that's we're actually seeing Agentic commerce on the B to B
• 6:33
  side for those, those flows where I'm not going to charge
• 6:37
  you £50 a month to use my system.
• 6:40
  You just use 10,000 API hits. I'm going to charge based on
• 6:44
  those hits. And that's that's where we're
• 6:45
  seeing kind of leading indicators with, with the
• 6:47
  platforms that we're working with.
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  I do. OK, very good.
• 6:51
  I've been there. The B to B piece has come up a
• 6:53
  few times today. Like how do you guys address
• 6:57
  that? You know, there's a question
• 6:58
  here around kind of shifts in payments of commerce back.
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  How do you guys address that with your kind of go to market
• 7:03
  strategy where you've got traditional B to C platforms,
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  but you're now seeing maybe B to B platforms engaging with you
• 7:10
  guys and becoming part of your customer base.
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  Like how do you build products around that?
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  I think what's important because we're, we're the piping, right
• 7:18
  for we're the piping for these businesses.
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  We don't really care how money comes in and how money goes out
• 7:24
  when we need to make sure that we give all that optionality to
• 7:27
  the platform. So if they're B to C, they'll
• 7:29
  use the Visa, MasterCard, the card networks.
• 7:31
  If they're B to B, they'll look, look at open banking, they look
• 7:34
  at direct debits. You got stable coins kind of
• 7:37
  come in slowly. It's not, it's not quite there
• 7:39
  yet, but giving optionality is important so that they can they
• 7:43
  can take whatever the payment methods they want to take in.
• 7:45
  They want to pay out whatever way it could be Visa direct or
• 7:49
  could be bank to bank, whatever that is, given that optionality
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  is important. And that's what we built for the
• 7:54
  the full, the full stack from top to bottom.
• 7:58
  And that's what Riff Riff gives these gives these platforms.
• 8:01
  Yeah. And have you got some
• 8:03
  marketplace customers that have or platforms even that started B
• 8:07
  to C and now adding B to B to their stack as well?
• 8:11
  So that's a really interesting one because they, we've actually
• 8:17
  seen that quite a few times where they go, it's the
• 8:19
  platforms we usually work are B to B to C, but now we're seeing
• 8:23
  B to B to B. So they're actually going in,
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  they've got the end users for their businesses that they're
• 8:28
  working with and now they're bringing these businesses.
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  We have, for example, run the Botox marketplace where they
• 8:35
  allow allow end users to book their Botox, but they also allow
• 8:42
  the Botox prescribers to then buy from the pharmacies the
• 8:46
  Botox products. So they've kind of gone full
• 8:49
  circle and they've given the full solution to all the
• 8:52
  business, all the participants in that market, which is
• 8:55
  exciting. And we're seeing that in
• 8:57
  multiple different hospitality is another big one.
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  You, you, you work with businesses like OpenTable where
• 9:03
  they're working with restaurants, but they're also
• 9:07
  allowing the the restaurants to sell to them, buy and sell from
• 9:11
  their suppliers and the the kind of demand Gen. there.
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  So it's it's happening and that's they're expand expanding
• 9:17
  their jurisdictions, the businesses that they're worth
• 9:19
  and you. Guys have payouts as part of
• 9:20
  your products that because of that shift I presume as well,
• 9:24
  right? Like how big a accompanying
• 9:26
  product is that payouts proposition of yours alongside
• 9:29
  cards? Exactly.
• 9:30
  And by by having all that in one solution, you're making a lot
• 9:35
  easier for these platforms to then expand into those, into
• 9:38
  that, into those additional methods.
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  So yeah, exactly. That's that's how we do it.
• 9:43
  Absolutely. So when we're looking at agentic
• 9:46
  commerce and the way that things are currently being built, we
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  have so many new protocols being introduced.
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  We have agent pay, we have visa stokenized platform, we have all
• 9:57
  of those different things. But discovery like you already
• 10:00
  mentioned is probably the the most important aspect of that.
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  Is that the only real life use case that we have right now, or
• 10:07
  are other other things that you're seeing?
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  I would say that's the most most used use case.
• 10:13
  Like you're now moved to top of funnel where a user can find a
• 10:18
  product. They could have done a Google
• 10:19
  search, but it would have come up with the most kind of SEO
• 10:23
  product or business. Now you're because the LLM is
• 10:29
  picking up more data points and it's looking at it in more of a
• 10:32
  human way. OK, what does the review look
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  like? Do I trust the, the, the, the
• 10:38
  platform itself? What does the supply look like?
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  You're getting products surfaced in a way that you weren't
• 10:44
  previously. And by focusing on that
• 10:47
  discoverability, you're giving a leg up to businesses that were
• 10:52
  really struggling previously, like where they were getting
• 10:55
  pushed down with Google getting penalized because they were too
• 10:58
  small or they didn't have all those kind of touch points.
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  Now those are coming up top. So by using those like new CP
• 11:06
  that Google is launching, these are simple implementations for
• 11:10
  them, but they can become a lot more discoverable and increase
• 11:13
  their increase their their revenues.
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  Shifts like this happen very rarely.
• 11:19
  Obviously we saw with Internet now I would say it's probably
• 11:23
  bigger than the int like what's happening in terms of what we've
• 11:27
  seen internally to the business itself.
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  So super exciting. Those who are agile will step
• 11:32
  ahead of everyone else and those will fall back.
• 11:35
  Does that overlap with clean product data, catalog
• 11:39
  visibility, inventory surfacing? Like do you guys get into that
• 11:43
  conversation around guiding your customers on, it's a difficult
• 11:48
  question because like as the payments companies, how far is
• 11:51
  that your responsibility? Or is that the marketplace then
• 11:55
  discussing that with their end sub merchants or customers?
• 11:58
  Like I feel like it has to have some origination with the
• 12:01
  payments platform because it will impact the end conversion.
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  You're you're seeing the blurring of the lines because
• 12:07
  previously it was OK, Shopify is doing your your web front try
• 12:15
  for example, he's doing your payments.
• 12:16
  There is a full distinction there.
• 12:18
  Now you're kind of mixing the two together to say, right, you
• 12:21
  got payments is adding some data and your, your ecom side is
• 12:27
  adding some data there. Mix the two together and you
• 12:30
  get, you get better results. So that's how we're, that's how
• 12:33
  we're positioning to the platforms where we're giving
• 12:35
  them that, that additional data. We're guiding them because we,
• 12:39
  we're doing AEO internally like because we're seeing a big value
• 12:42
  there. We're guiding them with, with
• 12:44
  advice that we've seen internally and we're giving that
• 12:47
  to the platforms. And it's it's a kind of mixture
• 12:49
  of the 2 is really adding value to these businesses.
• 12:52
  So from a practical perspective, do businesses now need to be
• 12:56
  grushing to become the genetic or you say it's a it's a little
• 13:00
  bit early for that? It's good for marketing because
• 13:04
  the the the words are getting picked up by Google and all
• 13:07
  these kind of and your the likes of tech crunches, sifting and
• 13:10
  stuff. You don't need to rush to do
• 13:14
  everything all at once for being discoverable and giving.
• 13:19
  Given the LMS the visibility of what they need to increase that
• 13:22
  I would I would focus on those to build some defence ability.
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  And then as customers start using these workflows more and
• 13:30
  more, you can double that. What we're always pragmatic in
• 13:34
  terms of rift. We try something as it's
• 13:38
  working. We put the wall down and keep
• 13:40
  pushing into that. But that that would be my
• 13:42
  advice. And then how should businesses
• 13:45
  be thinking about embedded commerce and monetization in
• 13:50
  today's market? So I would say that precedes
• 13:54
  agentic conversations like that should be the focus like
• 13:58
  especially with the platforms and marketplaces and franchises
• 14:01
  that should be the the the main goal because payments is
• 14:05
  becoming core part of these businesses as they've always
• 14:08
  been. But now they can monetize in
• 14:11
  easier and easier way. 10 years ago you would have to go get get
• 14:14
  your own licenses takes 18 months.
• 14:16
  Only 8% business in the Commission do that you would
• 14:19
  have to build the tech takes 2-3.
• 14:21
  You have to have full compliance team.
• 14:23
  Now with the help of like someone like Riff, 4-5 weeks of
• 14:26
  integration, you start monetizing your own transaction,
• 14:29
  you become in effect your own payment processor.
• 14:32
  And so we've reduced the the kind of pain of going to market
• 14:38
  and monetizing your payments. So that should be people.
• 14:41
  I'm so unbiased, but that should be regardless of Rift, that
• 14:44
  should be the focus because that could be a big new revenue
• 14:47
  stream that these guys didn't have access to before.
• 14:49
  Do you see though you know obviously from your EUR point of
• 14:52
  view with being a pay fact, right, like you have that
• 14:56
  autonomy, but do you have certain customers that would
• 15:00
  want to be emerged in a record in their own right and how do
• 15:03
  you manage those sort of engagements with those types of
• 15:06
  businesses A. 100% you you get. You always have businesses where
• 15:10
  they want. So it will really come down to
• 15:13
  the regulation side as well. Some, some merchants, they want
• 15:15
  to be merch of record, depending on what market they're in, that
• 15:20
  would be OK. But some markets you can't.
• 15:22
  You can't be in a flow of funds. That's kind of where we come in.
• 15:25
  But based on risk levels and the strategy of the platform itself.
• 15:28
  Sometimes they want to do everything themselves, which is
• 15:31
  completely fine. But how we deal with those
• 15:34
  businesses, we give them the technical ability or here's the
• 15:36
  tech you deal with licensing. That's completely fine.
• 15:40
  But then sometimes they don't want to deal with any of it is
• 15:42
  like, I want to plug something in.
• 15:44
  I want it to just work, let's go, let's let's kind of push it
• 15:47
  to the market. So we've we've got that full
• 15:50
  flexibility depending on how the one wants to play around with
• 15:53
  the with the pain inside. And do you think we're going to
• 15:55
  see merging of record becoming you guys again because you deal
• 15:59
  with so many marketplaces? Do you think we're going to see
• 16:01
  that becoming more mainstream in the next five years or so?
• 16:04
  It's your record. Exactly.
• 16:06
  We see going the other way. Well, because, yeah, they want
• 16:09
  to, they want to remove themselves from that complete
• 16:13
  flow. So they'll say, right, you guys
• 16:15
  deal with it and we'll just pay us our fees, whatever that looks
• 16:19
  like. And then you guys deal with the
• 16:21
  with the rest of the flows. So that's that's kind of where
• 16:24
  we see the the market move on our side, but you might have
• 16:28
  seen something completely different.
• 16:29
  Obviously I work in embedded payments as well, but I feel
• 16:33
  like that's OK. As acquirers, sometimes we still
• 16:36
  struggle to comprehend the moving parts of why a business
• 16:41
  would want to be merching a record.
• 16:42
  There's some interesting like distribution type marketplaces
• 16:44
  where technically they manage the cradles gave to grave like
• 16:48
  distribution of those goods, right?
• 16:49
  So they want to be the merchant record because they have some
• 16:52
  huge brands working with them. But technically in the small
• 16:56
  print that customer is contracting directly with the
• 16:58
  marketplace, right? So you buy a pair of Adidas
• 17:00
  trainers, you might look like you're buying them from Ali
• 17:03
  Daspin, the small frame, right? There's a distributor that's the
• 17:05
  Mor that is kind of the pseudo marketplace.
• 17:07
  And they're, they're taking all of the risks because they're
• 17:09
  kind of like, well, we do all of the fulfilment.
• 17:11
  So yeah, the risk is kind of on us because it's our job to get
• 17:14
  those trainers from A to B to the customer.
• 17:15
  And if the customer's not happy, then we'll take on that risk.
• 17:18
  And I think we're seeing this version of like marketplaces
• 17:20
  where they're they're not as afraid to take that risk on in
• 17:25
  some way because they are taking on more of that distribution
• 17:28
  ecosystem. And that gives them more margin,
• 17:30
  right, because they're taking more of the risk, they'll take a
• 17:32
  bit more margin. So I think I complete, I think
• 17:35
  it really comes down to their business model and how they
• 17:37
  think as a strategy. But given that flexibility is
• 17:40
  important and letting them do their own thing and and be able
• 17:44
  to switch between the two, sometimes we have merger start
• 17:47
  one way and they want to switch the other side.
• 17:50
  And if you don't have the right solution in place, it could be
• 17:54
  really painful. So we would kind of make sure
• 17:57
  that it's a seamless switch between the two before we let
• 17:58
  you. Go.
• 17:59
  We have a segment on the on the podcast where we always say it's
• 18:04
  the the shelf of shame. In this particular case, I would
• 18:07
  want to say what is something that frustrates you currently
• 18:10
  about how people are talking about the gender commerce right
• 18:14
  now, which you think they should eliminate?
• 18:17
  I think for me, it's people talking about it like it's done
• 18:23
  and dusted and they know what's going on and this is going to
• 18:26
  what it's going to be like. I think people are
• 18:28
  underestimating how complex this is about to get with the use of
• 18:34
  LLMS. But we're we're seeing everything becoming more and
• 18:37
  more fractured and that is going to make everything a lot more
• 18:42
  complex. So that's what's frustrating,
• 18:46
  completely honest, but we're trying to figure out as we go.
• 18:50
  But yeah, obviously again, back to being a marketing tool, it's
• 18:53
  great to say we've figured it out guys.
• 18:55
  Let's it's this is what it's going to be like.
• 18:57
  But I don't think that's that's what's that's going to be the
• 18:59
  case in the. Very, very early stages.
• 19:00
  Exactly. But that's what's exciting.
• 19:02
  That's. Absolutely.
• 19:04
  Bro, well, thanks for joining us on the show.
• 19:06
  Welcome people. Get in touch with you.
• 19:07
  Find out a bit more about Rift. Yeah, go to the website
• 19:11
  riftpay.com and LinkedIn as well.
• 19:14
  We've got the team on there and myself, Sadra at riftpay.com.
• 19:18
  Anyone wants to get in touch? I'm happy to.
• 19:20
  Yeah, yeah, yeah. Don't hit me too hard, yeah?
• 19:24
  Well, thanks for joining us today.
• 19:26
  Enjoy the rest of the event. Thank you very much.
• 19:27
  Thank. You very much.