Online and mobile payment services have been developing at an accelerating pace over the last decade, and new businesses have sprung up to meet the demand. Started in 2007, SafeCharge International Group Ltd. now has over 350 employees across 7 countries. Its CFO Ali Farid Khwaja shares his insights as a seasoned expert in this industry with Leaders League.
Leaders League. How did SafeCharge get started?
Ali Farid Khwaja. SafeCharge was formed in 2007, when our co-founder and CEO David Avgi realized that there was a niche in the industry where online merchants needed good third-party payment providers for benefits such as reducing risk and fraud, obtaining a merchant account and giving access to a number of alternative payment methods and a large network of banks. The core of the technology platform needs to be a robust risk management system to make sure that the transactions are safe and secure. This led to the creation of SafeCharge.
Leaders League. What is your positioning in the market?
A. F. K.We are the market leaders in industry verticals which require high frequency and low latency, especially over the mobile phone. Our technology is most optimized for facilitating quick transactions 24/7. This makes us the leaders in verticals like Financial Services (like stock and FX trading), Digital goods and online gaming.
Today, we have a very strong presence in the regulated sports & leisure and financial services markets, as well as in online games, retail, airlines, travel and energy. We have recently entered the prepaid card market and garnered a lot of interest.
Leaders League. To what extent has the IPO at the London Stock Exchange changed the decision-making process and long-term development strategy of SafeCharge?
A. F. K.In April 2014, we successfully raised US$122 million (net of transaction costs) to strengthen our balance sheet and support new growth. The IPO expanded the shareholder base to include a number of long-term institutional investors, in addition to individual investors. A number of regulatory licenses have been granted and two strategic acquisitions were made since the IPO. The strong trading and momentum of 2014 will allow us to pursue a focused M&A strategy. Indeed, a key element of our strategy is growth by expanding into additional geographical markets, along with diversifying our presence in additional high-volume segments of online services (specifically airline, travel and retail), both through organic growth and potential acquisitions of technologies and a wider client base.
The IPO was definitely a major milestone. Customers prefer dealing with a listed company since they know that financials are transparent and available to public. This improves trust. Our industry is all about trust and the IPO helped us further improve our standing in the industry. This was also of course reflected in the growth in earnings in 2014, when our profits more than doubled.
Leaders League. Do you see financial institutions and payment platforms as your competitors or partners?
A. F. K. I would say our competitors are also our partners. Payment industry is all about partnerships. It is a network of partners who trust each other. As a payment technology company, we strive to provide our merchants with a best-of-breed Cashier solution and ensure that their transactions are routed to the most available and optimal financial institution, so we have excellent partnership with a number of financial institutions in order that when we provide merchants with the optimized checkout technology, the financial institutions provide the actual fund transfer facilities to our clients.
Leaders League. What are the main challenges for the development of online and mobile payments?
A. F. K. As the market is already so far advanced, one challenge is to always try and keep ahead of the trend. With the introduction of more sophisticated digital devices, there is a need for more intelligent solutions that take time, insight and resources to develop.
Leaders League. From your perspective, what are the pitfalls for a hi-tech start-up to avoid?
A. F. K.There are a number of aspects to consider for a company to be successful, however I believe that the most important is to listen to your customers and adapt the product strategy accordingly. One of the key success factors of SafeCharge throughout the years has been thorough understanding of client needs, building innovative solutions to actual problems and developing the business model in parallel. Long term planning along with solving actual problems is the best strategy to build a B2B technology startup.