Latest / Leaders In Payments / Floris de Kort, CEO of Thunes | Episode 406

Transcript

Floris de Kort, CEO of Thunes | Episode 406 · Leaders In Payments

• 0:01
  Speaker 1: Welcome to the Leaders in Payments podcast, where we talk to C-level leaders from across the payments landscape.
• 0:06
  Speaker 1: We'll be discussing the products and services that impact the payment space today, as well as trends and predictions for the future of payments.
• 0:14
  Speaker 1: We will also hear stories from our guests about their journeys to the top.
• 0:18
  Speaker 2: Hello everyone and welcome to the Leaders in Payments podcast.
• 0:20
  Speaker 2: I'm your host, greg Myers, and today's special guest is Floris de Kort, the CEO of Tunes.
• 0:26
  Speaker 2: So, floris, thank you for being here and welcome to the show.
• 0:28
  Speaker 2: Thank you for having me Appreciate it Absolutely.
• 0:31
  Speaker 2: So before we get into the meat of it, if you don't mind, tell our audience a little bit about yourself, maybe where you grew up, where you went to school, where you currently live, a few things like that.
• 0:39
  Speaker 3: Well, the funny accent's Dutch, so Dutch.
• 0:40
  Speaker 3: So I grew up in the Netherlands.
• 0:42
  Speaker 3: I currently well for now, but that needs to change.
• 0:45
  Speaker 3: I currently live in Australia with my husband and two six-year-old children, but for Tunes it makes more sense that we relocate ourselves to either Europe or the UK, so somewhere over the course of the next six months we will move back to Europe.
• 0:58
  Speaker 2: Okay, great.
• 0:58
  Speaker 2: So let's talk about the company.
• 1:00
  Speaker 2: So I think most of our listeners are probably going to know what Toons does, but if you don't mind for those that may not just tell us what Toons does, yeah.
• 1:08
  Speaker 3: So Toons is the smart superhighway to move money around the world.
• 1:11
  Speaker 3: We have spent quite a bit of time and resources and money building a network of direct connections to over 350 real-time banks and wallets, as well as to the main card schemes like Visa, MasterCard and UnionPay, for members of our network to make real-time payouts into all these APMs and wallets and cards, etc.
• 1:30
  Speaker 3: So Junes moves money and we do it in real time.
• 1:33
  Speaker 3: We do it in over 130 countries and over 80 currencies.
• 1:36
  Speaker 3: We support both fintechs, financial technology companies, traditional money remitters, but more and more so we support businesses for business payments.
• 1:45
  Speaker 3: Think of travel companies, think of insurance companies, think of social media companies.
• 1:50
  Speaker 3: That's the key focus right now.
• 1:52
  Speaker 2: Okay, and it's all B2B type payments.
• 1:53
  Speaker 2: It's B2C, b2b, it's a mix actually Okay.
• 1:56
  Speaker 2: And you said obviously global.
• 1:59
  Speaker 2: Where's the company, headquartered the company?
• 2:01
  Speaker 3: is headquartered in Singapore, but, yeah, safe to say, our people, our tunesters, as we call them, are all over the world.
• 2:06
  Speaker 3: We operate out of 13 different sites.
• 2:08
  Speaker 3: We're around 480 people, but we are 65 different passports, so it's a very, very multinational company.
• 2:15
  Speaker 2: Okay, and what about your US presence?
• 2:18
  Speaker 2: Is that something relatively new?
• 2:19
  Speaker 2: Is that a big focus of the company?
• 2:22
  Speaker 3: It is definitely a big focus of the company.
• 2:24
  Speaker 3: We've been in the US for a while.
• 2:25
  Speaker 3: Our base is in San Francisco, but just this past week we announced that we now have licenses to operate in all 50 US states with a licensing regime which will accelerate our growth in the US quite significantly.
• 2:38
  Speaker 3: So we're actually adding quite a few more heads in the next six months.
• 2:42
  Speaker 3: We're opening up a second site on the US East Coast, in Atlanta, to really focus on global American customers.
• 2:49
  Speaker 3: So again, think of you know social media companies, travel companies who are headquartered in the US and therefore the commercial relationship is in the US, but who process a lot of cross-border payments into Africa, Middle East, Southeast Asia, the parts of the world where Tunes' network is strongest, Like think of Meta paying content creators in all those geographies, those types of customers to service.
• 3:12
  Speaker 2: Okay, so really, it's going to be larger companies, not small business, correct, yeah, now.
• 3:15
  Speaker 3: Tunes focuses on large companies with high volume of international cross-border payments, not small business.
• 3:21
  Speaker 2: Okay, so what would you say?
• 3:23
  Speaker 2: Differentiates Tunes from your competitors.
• 3:25
  Speaker 3: I think it's three main things.
• 3:27
  Speaker 3: First and foremost, it's the network that I mentioned earlier and the fact that all the connections that we've built to mobile wallets all around the world, like Gcash in the Philippines and Pesa in Kenya and so on, that those connections are direct.
• 3:39
  Speaker 3: There is a lot of competitors who claim to be similar to Tunes, but they've quickly rushed to markets by basically building pipes to aggregators and then you get, like you know, a pipe to an aggregator who goes to another aggregator, and so on.
• 3:51
  Speaker 3: And why does that not work as well as Tunes?
• 3:53
  Speaker 3: Well, if you go direct, you see higher transaction success rates and you see a higher percentage of payments actually arriving in time.
• 4:00
  Speaker 3: So what we call quality of service or QoS, which we track relentlessly, gets a lot better.
• 4:05
  Speaker 3: Second, it's obviously more cost efficient to go direct.
• 4:07
  Speaker 3: And third, if something does go wrong, issue resolution is a lot faster and easier because you deal directly with the endpoint.
• 4:14
  Speaker 3: So it leads, just overall, to a much better customer experience.
• 4:17
  Speaker 3: So that's the first thing I'd call out as to how Tunes differentiates itself from other networks.
• 4:22
  Speaker 3: Second, I'd say all our systems are in-house.
• 4:24
  Speaker 3: So, whether it's our processing platform or all our treasury systems for currency conversion or very important our liquidity forecasting system.
• 4:35
  Speaker 3: How much money do we need in each country to support all our customers, all that's been built in-house, all that it's proprietary and all that we control ourselves?
• 4:40
  Speaker 3: And then, thirdly and lastly, what?
• 4:43
  Speaker 3: What I'd call out what sets students apart is that from the day the company was founded by our founder, in our DNA we have had this relentless focus on compliance.
• 4:52
  Speaker 3: We only operate in the white space.
• 4:54
  Speaker 3: We get licenses wherever we need licenses, touch wood, but we've never run afoul of any rules or regulations or regulators.
• 5:00
  Speaker 3: We've built a company with the compliance standards of a bank because our customers trust us with their money right, and that's deeply embedded in the DNA of the company and we'll keep focusing on that.
• 5:09
  Speaker 3: We really see compliance actually as one of our USPs, as a moat that we've created for Tunes around Tunes.
• 5:16
  Speaker 2: Okay, okay.
• 5:16
  Speaker 2: Well, let's talk about the future of payments.
• 5:20
  Speaker 2: Where do you see payments headed, say, maybe in the next three to five years?
• 5:25
  Speaker 3: That's an interesting question.
• 5:25
  Speaker 3: Well, if I think of cross-border payments, obviously the history or the past is swift, right, like cross-border payments used to be done only or exclusively with like a cross-border bank transfer.
• 5:35
  Speaker 3: And you know those are slow, right.
• 5:37
  Speaker 3: It takes a few days for a bank transfer to arrive.
• 5:40
  Speaker 3: You don't actually know if the funds arrived.
• 5:42
  Speaker 3: You need to pick up the phone and say like, hey, did you receive my wire transfer?
• 5:50
  Speaker 3: It's expensive and it's closed on Saturdays and Sundays and bank holidays.
• 5:52
  Speaker 3: So the future of payments clearly is real time of cross border payments is real time and neo banks and alternative payment methods and mobile wallets they all support real time cross border payments.
• 6:01
  Speaker 3: So I think in the future we will see that shift towards those payments accelerate.
• 6:05
  Speaker 3: We see real time become more important and I think it's also being helped kind of by a shift just in the macro landscape, like Visa and MasterCard have done incredibly well the last 10, 15 years with wind in their back, from the cash to digital conversion in the West, in Europe and in the US.
• 6:24
  Speaker 3: But that cash to digital conversion is now shifting to Africa, the Middle East and Southeast Asia and those are markets where it's like mobile wallets and banks that are the prevailing payment methods, so that will shift more volume and more focus to again the real-time nature.
• 6:39
  Speaker 3: So I do think that's the future.
• 6:41
  Speaker 3: And then second and I'm actually impressed that we've managed to talk now for 10 minutes without mentioning stablecoin, but clearly that's another rapidly emerging trend in this space as well right, leveraging stablecoins for cross-border payments.
• 6:53
  Speaker 3: We see that as just another vehicle on the highway.
• 6:55
  Speaker 3: So our smart superhighway transports anything of value, whether it's a US dollar or Korean won or stablecoin, and we see stablecoin wallets as the next endpoint we pay into, next to mobile wallets, next to bank accounts and so on.
• 7:09
  Speaker 3: So I think stable coin is going to have a real impact on cross-border payments as well and especially on that push, that acceleration towards real time.
• 7:17
  Speaker 3: Sorry that was a very long answer.
• 7:18
  Speaker 2: No, that was a great answer.
• 7:19
  Speaker 2: So do you feel like we're not too far from it truly being as real time as a payment can be, say, in the United States?
• 7:27
  Speaker 3: Yes, absolutely.
• 7:28
  Speaker 3: I mean it will take time and obviously, cross-border bank transfers, swift, etc.
• 7:32
  Speaker 3: It's not going to go away.
• 7:33
  Speaker 3: And personally one man's opinion I don't believe that in the future there will be only stable coins.
• 7:38
  Speaker 3: It will all coexist.
• 7:39
  Speaker 3: And the good news for with my tunes, head on for tunes is obviously that that adds to the complexity, right, because it makes the landscape even more fragmented.
• 7:47
  Speaker 3: And the more complexity there is to solve for our customers, the more attractive our proposition becomes, which is, you know, through a single API, you get access to all these payment methods globally, whether it's alternative payments or bank accounts or mobile wallets or crypto wallets or pay-to-card.
• 8:01
  Speaker 3: With one API you access it all and I think it will all coexist Okay.
• 8:08
  Speaker 2: And there's a buzzword, at least here in the States, that I see a lot in the trade rags and different conversations, and it's orchestration.
• 8:13
  Speaker 2: So maybe how is this similar or different than payment orchestration?
• 8:16
  Speaker 2: I think it's quite similar right it's.
• 8:18
  Speaker 3: Ultimately.
• 8:18
  Speaker 3: What Tunes does is about making sure that consumers have choice and that our customers have access to all those choices.
• 8:24
  Speaker 3: But the consumers in the driving seats and whether they want to pay with the stablecoin or into a stablecoin wallet, or whether they want to pay by sending US dollars cross borders into a M-Pesa wallet in Kenya, that choice is there and the choice via Tunes is accessible via one API and a single integration.
• 8:39
  Speaker 2: Okay, okay, you know how do you choose which payment methods to integrate.
• 8:43
  Speaker 2: I mean, is there a certain volume that you expect to see, or is it?
• 8:48
  Speaker 2: How do you decide when is the right time to integrate with a certain wallet?
• 8:53
  Speaker 3: Yeah, it's a really good question.
• 8:54
  Speaker 3: Actually, we look at quite a few things.
• 8:56
  Speaker 3: I mean, first of all, we look at what our customers are asking us, right?
• 8:59
  Speaker 3: I mean, that's a very important factor.
• 9:01
  Speaker 3: What do we hear from customers and what demands from consumers do they see?
• 9:04
  Speaker 3: But second, we also want to make sure that we don't only focus on, like you know, the large, significantly high volume payment methods, wallets, apms, et cetera, because for us the long tail is equally important, like the global reach of the network, the depth that we have in Africa, where we offer quite a few payment methods that standalone might not have that much volume, but the fact that all of them are accessible via one integration and have that much volume, but the fact that all of them are accessible via one integration and therefore you have access to all of Africa, is actually really important strategically for tunes as well.
• 9:32
  Speaker 3: So we look at both and we in our investment committee we try to balance those investments as best as we can between what's strategically important for us and what are our customers asking for and has the most volume.
• 9:43
  Speaker 2: Okay, okay.
• 9:43
  Speaker 2: Well, I don't feel like we can leave the conversation of the future without talking about AI.
• 9:49
  Speaker 2: So curious as to your thoughts on AI and how it's being integrated into the payment space.
• 9:54
  Speaker 3: Yeah, it's a very good one.
• 9:56
  Speaker 3: We've obviously been spending a lot of time on looking how AI can help further enhance and augment our service proposition as well, and we have found one main use case that we're very focused on right now, and then a few obvious ones that I'll touch on as well, but for us so far, the main use case has been liquidity forecasting.
• 10:13
  Speaker 3: A very important part of what we do is forecast how much liquidity do we need in each payout corridor to support the needs of our customers?
• 10:21
  Speaker 3: And we need to get that right, because obviously, if we under forecast, then there's not enough liquidity to process the payouts that our customers are asking for.
• 10:28
  Speaker 3: But if we over forecast and we just put like gazillion dollars everywhere, then we run out of exposure because our business accounts in US dollars.
• 10:35
  Speaker 3: So we want to get that precisely right, and the tool for that we've built in-house, significantly enhanced, using AI, because AI seems to be much more capable than a human being to very quickly analyze historical patterns of the processing of all our customers, what we know about certain trends, certain bank holidays, certain events like Chinese New Year Take that all into the equation and then forecast precisely what liquidity we need, where at what moment in time.
• 11:06
  Speaker 3: So that's one area where we've been very focused on and then in parallel, we're doing all the obvious things too right.
• 11:11
  Speaker 3: I mean, most businesses right now are looking at like how can AI be leveraged in customer services to result for better answers for customers and to take?
• 11:19
  Speaker 3: You know, human beings tend to react emotionally.
• 11:22
  Speaker 3: Ai never does.
• 11:23
  Speaker 3: To take the emotion out of the conversation.
• 11:25
  Speaker 3: We're looking at how we can use AI in development for the speed of the process of coding and writing code.
• 11:30
  Speaker 3: So there's actually multiple areas where, as a company, we're currently focused on leveraging AI.
• 11:35
  Speaker 2: Okay, great Thanks for sharing that.
• 11:36
  Speaker 2: So let's switch gears a little bit and talk about you.
• 11:39
  Speaker 2: Maybe tell us a little bit about your professional background and how you got to your role there at Tunes.
• 11:44
  Speaker 3: Oh, that requires me to complain about how long I've already worked in FinTech and how old I am.
• 11:50
  Speaker 3: I've worked in FinTech for what is it?
• 11:51
  Speaker 3: It's now 24 years.
• 11:53
  Speaker 3: I actually started my career in sales at a back then a Dutch payment startup called Global Collect, which is now part of Worldline, one of the first payment gateways out there, and I was actually Global Collect's first person on the ground in the United States, so I moved for them to San Francisco and build up their US presence from just myself to over 50 people.
• 12:12
  Speaker 3: From there I went on to Asia and, still for Global Collect, did the same thing and then ultimately made it to chief revenue officer.
• 12:19
  Speaker 3: Then I left and I joined WorldPay in 2010, which was when WorldPay was rescued out of Royal Bank of Scotland's bankruptcy by Bain Capital and Adfin International.
• 12:28
  Speaker 3: I joined WorldPay as divisional CEO for the global e-commerce division, basically dealing with all large global customers who were buying and selling online, like airlines and travel companies and video games companies and software companies, and I did that for seven years, was part of the team that led Willpay's IPO in London in 2016.
• 12:47
  Speaker 3: And also of the team that then led the merger with Ventive, which formed yet again, a new Willpay.
• 12:52
  Speaker 3: And then after that, I left and joined a company as CEO that is now called Explore Technologies, which is a company that actually sells business management software for really specific industries like childcare and early learning, fitness and well-being field services.
• 13:08
  Speaker 3: But that software came with embedded payment processing.
• 13:11
  Speaker 3: So Explore also owns a payment processing platform, which makes for a really interesting revenue profile, because about half of Explore's revenue is coming from traditional SaaS software subscription payments and the other half is coming from payment processing.
• 13:24
  Speaker 3: So really unique model.
• 13:26
  Speaker 3: And yeah, about a year and a half ago I joined Tunes as CEO, where our founder, peter de Kalu, wanted to step away from the daily running of the business and join the board, which is what he did.
• 13:36
  Speaker 3: So he's still with us and he's a great support for me and fountain of knowledge.
• 13:40
  Speaker 3: But Peter is the idea generator, the startup leader, and Tunes has now reached that point whereby you know we're no longer a startup, we're not even a big startup.
• 13:48
  Speaker 3: We're now a small big business.
• 13:50
  Speaker 3: And with that comes the need to start thinking about like scaling, like no more single points of failure, proper automation, all the processes properly documented, etc.
• 14:01
  Speaker 3: And that's not what Peter enjoys most doing.
• 14:02
  Speaker 3: He enjoys coming up with a new idea and I'm more the execution person, so we make a really great combination and, yeah, that's what I've been doing the last 18 months.
• 14:10
  Speaker 2: Okay.
• 14:10
  Speaker 2: So what was it that was so attractive about Toons that you said, yes, I'll take this?
• 14:15
  Speaker 3: Two things actually.
• 14:16
  Speaker 3: As I said earlier, my background is commercial.
• 14:18
  Speaker 3: Right, I started my career in sales and what really attracted me about Tunes is the huge commercial opportunity that's out there for us to go get.
• 14:26
  Speaker 3: Cross-border payments is a $150 trillion industry and it's growing at 5% a year.
• 14:32
  Speaker 3: So just the market is growing 2000 times the size of Tunes every single year.
• 14:37
  Speaker 3: So the commercial opportunity, the volume that can go after, is massive and yeah, as a commercial person, that excites me.
• 14:44
  Speaker 3: But then, second, you always take a quick look at the competition, right, and you know nothing negative about the competition, but I just know we can do better.
• 14:50
  Speaker 3: I mean, of course Swift has like the vast majority of the market, but, as I said earlier, it's not real time, it's closed on weekends, you don't know if the funds arrived, it's expensive.
• 15:00
  Speaker 3: So we can compete against that and we can also compete against some of the other companies in this space who don't have that unique asset that we have, which are the direct connections, which is the direct global network.
• 15:11
  Speaker 3: So the combination of those two things the market size, the market growth and just June's competitive position as a commercial person, person that made me really interested in this role.
• 15:20
  Speaker 2: Okay, great Thanks for sharing that.
• 15:21
  Speaker 2: So what are some things you're passionate about?
• 15:24
  Speaker 2: Maybe one work-related passion and one personal passion.
• 15:27
  Speaker 3: Work-related.
• 15:28
  Speaker 3: What I'm actually really passionate about is the impact that Tunes is having in the, let's say, emerging markets in Africa, parts of Southeast Asia and so on.
• 15:36
  Speaker 3: Because of the rise of real-time payments and mobile wallets, we are actually helping large amounts of people to join the global economy.
• 15:44
  Speaker 3: The best example I can use there is let's take the example of a ride share company.
• 15:49
  Speaker 3: You know, in Africa most people don't have a bank or a bank account, but what they do have is a mobile phone with a wallet and now, thanks to Tunes and our ability to pay out into that wallet in real time, even multiple times a day, they can, for example, take a job at, let's say, grab or Uber and start driving a car, make a few rides, go into their driver app, click pay me.
• 16:10
  Speaker 3: Funds show up in real time, pay at the gas station for more fuel, take the next few rides, and so on.
• 16:16
  Speaker 3: What we see is that a lot of these people now suddenly earn a living, pay themselves multiple times a day because they need the money to pay for the next amount of fuel, and none of that was possible, and I'm really passionate about how we're helping, in large parts of the world, people to actually, you know, start earning a living and enjoying the global economy.
• 16:32
  Speaker 3: On a personal level, what am I passionate about?
• 16:34
  Speaker 3: Honestly, it's mostly travel going to remote places of the world beautiful parks in the United States to like Antarctica and Greenland to remote areas in Southeast Asia and hiking long hikes in nature, long walks and just exploring and seeing parts of the world, ideally on foot.
• 16:52
  Speaker 3: That really enjoys me and allows me to clear my mind and step away from payments, if only for a few hours.
• 16:58
  Speaker 2: Right, right, Okay, great.
• 16:59
  Speaker 2: So if someone came to you, maybe they just graduated from college or university, they're looking at building a career and they pick payments in FinTech.
• 17:08
  Speaker 2: They see it as a great opportunity to build their career.
• 17:11
  Speaker 2: Given your experience in this space, what kind of career advice would you give them?
• 17:16
  Speaker 2: What would you tell them they need to do?
• 17:28
  Speaker 3: to be successful in this space?
• 17:29
  Speaker 3: Never stop learning.
• 17:30
  Speaker 3: I.
• 17:30
  Speaker 3: What kind of career advice would you give them?
• 17:32
  Speaker 3: What would you tell them they need to do to be successful in this space?
• 17:34
  Speaker 3: New things, just keep reading.
• 17:37
  Speaker 3: Keep asking questions there are no dumb questions, right.
• 17:40
  Speaker 3: Just keep speaking to colleagues, keep listening at trade shows, keep listening to podcasts.
• 17:47
  Speaker 3: It's an industry where you never stop learning, and if you don't have that natural curiosity, if you don't want to learn, then it also might not be the industry for you, right?
• 17:53
  Speaker 3: So be curious would be my number one advice.
• 17:55
  Speaker 2: Okay, yeah, I've been in this industry 20 years and done 400 podcasts in this space, and I continue to learn things almost every day, so I totally agree with that.
• 18:05
  Speaker 2: Well, before we wrap up the show, floris, is there anything else you'd like to add?
• 18:08
  Speaker 2: No, I mean this was great.
• 18:10
  Speaker 3: Thank you so much.
• 18:11
  Speaker 3: Like I said, it's a super fast changing environment.
• 18:14
  Speaker 3: 18 months ago, no one was talking about stablecoin, yet here we are.
• 18:17
  Speaker 3: And no one was talking about stablecoin yet here we are.
• 18:21
  Speaker 3: And, of course, ai.
• 18:21
  Speaker 3: And who knows what you and I will be talking about in 18 months time?
• 18:23
  Speaker 3: We might not even have heard of it today.
• 18:24
  Speaker 3: So that's the best part of the space, right?
• 18:25
  Speaker 3: Absolutely.
• 18:26
  Speaker 2: Well, floris, thank you so much for being on the show today.
• 18:29
  Speaker 2: I know your time is very valuable, so I really appreciate you being here.
• 18:32
  Speaker 3: And I appreciate you having me.
• 18:33
  Speaker 2: Thank you so much, really enjoyed it, thank you, thank you, and to all you listeners out there, I thank you for your time as well, and until the next story.
• 18:40
  Speaker 1: Thank you for joining us this week on the Leaders in Payments podcast.
• 18:43
  Speaker 1: Make sure you visit our website at leadersinpaymentscom, where you can subscribe to the show and where you'll find our show notes.
• 18:50
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