Interviewed By The Asian Banker Live
Alain Falys, co-founder and chief executive officer of Yoyo Wallet, a mobile payment and loyalty marketing platform in Europe, talks about how the company was founded, the things he learnt from establishing Yoyo Wallet, and its business model.
Emmanuel Daniel (ED): Very nice to speak to you Alain. You're the co-founder of Yoyo Wallet, you're also a senior tech entrepreneur, co-founded Omnis Mundi, e-commerce incubator and stuff like that. Just give us a sense of the businesses that you co-founded and what kind. And one how one led to the next, and what have you been learning on that process.
Alain Falys (AF): So, my first venture was in the year 2000. Remember, there was a year of a lot of upheaval. We are coming out of this .com boom and the bust. And that's kind of time I choose to create my first company. I was working for Visa, the Visa card company. The Visa European headquarters here in London. And I created a global electronic invoicing platform. So, somehow I got into it because I felt I have to do it. And I did it with bunch of people from Visa. And we created something which is very successful. And then I grew into the e-commerce side of things, from an incubation standpoint because I felt there was another era where post instead of earlier attempts in the 90s at e-commerce. I felt that in the mid to end 2000s, it was interesting to look at new businesses more in e-commerce. So, it was a passion of mine so I got interested in that. We incubated companies that cover in Germany, Switzerland, France, Spain, even in China. And then I got into creating Yoyo, which is a mobile first marketing loyalty platform for retailers because it was an actual extension of e-commerce. If you understand e-commerce and you shop in physical stores, you're thinking, hang on we've got these super smart mobile phones here and you expect really personalized experience with Spotify, with Amazon, with eBay. You don't get it on a high street, you don't get in stores. So how we'd fix that? So that's how I kind of got into Yoyo.
ED: The funny thing about e-commerce and the years that you've been since in 2000s is that there been has many failures as there been successes. Not everything in e-commerce works. Some things have still up in the air like invoicing, the EDI for example. Moving things around and stuff like that. What have you learned over time that tells you what works and what doesn't, given your experience on that?
AF: Well, usually what works as a business in your business is when your products is really solving a real problem, right. Or you've created an experience which is so dramatically different to what you used to that people use it, right. So, in several times what works is what, when people use it. Why people use that, whether the people within companies or individuals that kind of pure consumer play is because your experience is so far beyond. So, I've got a metric which I think works is if you don't deliver that 10x experience, ten times better than what people are used to, and then likelihood are your product will work whether it's in B2B environment or business-to-consumer then likelihood the work is very low. It has to be at least ten times better than what people are used to. So, if you create an electronic invoicing platform, right, and you basically get rid of the paper invoice for companies, that is more than 10x. It's really compelling, right. No paper, no manual processes, less people to handle that. All electronic, direct feed into your account and system that's 10x. Delivering a lot of experience around your payment, using the mobile where everything is embedded into one single experience which is I present my mobile to scanner, I've paid, I get immediately my points or the stamps that I earn for that particular product that is more 10x better than what we've experience today with like paper, stamp cards. I think really focusing on the app product is really makes a real difference.
ED: Yeah. At the same time, you seem to have this neck, or you limit yourself by working with existing infrastructure, existing incumbents anyway. Like in Yoyo, anyone looking at your business model will say, "it's always your opportunity to be a wallet more than just a loyalty scheme?" Why not take that temptation?
AF: So, we don't think that payment is broken. We think that retailers get paid, and we know that consumers pay. So, we got contactless, credit card you name it online and some great stuff. We don't think that payment is a problem for anybody, frankly. What we you think is broken is loyalty. And people like to be rewarded. They like to be rewarded for their customs, for their loyalty, for their purchase. And if we fix that in the digital age, it's massive. It's big for the retailers, of course, because loyalty creates footfall, footfall creates more sales. It's important to us as well as consumers we want to deal. Everybody wants to deal, that's universal. So, I think focusing on the loyalty marketing is much more interesting than focusing on payments. Like if you can bring the two together by even relying on incumbents to your point, the incumbents be the card companies, the banks, and it’s okay. Because our innovation is not in payment. Our innovation is in the automation and the personalisation of the loyalty experience. And if you link it to payment that's when the consumers like it.
ED: But even there, you seem to be going incremental in the way which western payment infrastructure is evolving. If I take the Chinese payment infrastructure, they are not even device dependent, in a way. So, and if you think about where payments is going in to the future, apps is going to be old fashioned in the modern year, too. You know, you're talking about the payments that take place at the point of which people interact. It can be a social media platform; it could be a messaging platform that's all things. Are you thinking as far ahead or you are really such a practical person that you work with whatever? The game plan is in the communities is where you operate.
AF: Well, as always when you run a business you have to have focus, right. And our focus is really to create a very different experience for the retailers around loyalty right. So, we notice, it's definitely broken that's why we’re fixing. By fixing that, actually we incentivise retailers to make their customers use Yoyo right. So, for us, you know that's the number one priority is really to make Yoyo the loyalty platform of choice of all major brands, all major retailers, and that in itself turns the consumers into Yoyo users. Now, the Yoyo users use Yoyo within a Yoyo app, within a banking app, or within a chat or messenger environment, that's not actually the most important thing. So, we truly lost into that, in fact all of our marketing loyalty platform from a technology standpoint is actually designed to be able to interact with these different environments. So, if the world is moving towards more attraction within social media platforms, more attraction within chats or messenger platforms then Yoyo will integrate into that right. But the study point is actually not that, its study point is the retailer. Adding value to the retailer is where we are focusing right now because it's where how we actually create the network that uses Yoyo. And of course, the experience has to be a greater experience.
ED: How is Yoyo funded? Have you got your own money in it? Which stage is it in? And where is it at the moment?
AF: So, the funding, we started with our own money. But also, money from prominent venture. So, we were eventually funded from pretty much the start which is great. We were able to launch very quickly. So, we started in the middle of 2013. We launched our first version of Yoyo in January 2014 in university campuses. And basically, move it up fast, fast running, forward. You know.
ED: from someone working on before that. It's someone working on it for a while.
AF: We were thinking about it for a while but we were very fast executing by A. we got the funding to execute fast. B. because we have the right team to execute fast. And the real understanding on what problem which we try to solve. So, fast forward, three and half years, we now have several 2000 users and we are transactioning over 1.7 billion transactions a month. So, we are growing very fast. And it's great to see that there is a real enthusiasm for using your mobile to pay when you actually add the extra component of loyalty and personalised rewards. We don't believe that mobile payment, for the sake of mobile payment is changing people's lives. We do believe now that if you start choose to pay, a real personalised reward experience to reward payment, then people will start using their mobile. That's really satisfying to see, the usage of Yoyo in retail chains like Caffe Nero, where our share of check is already at 6% after only five months. It has been growing so fast in a few months. It's really satisfying to see.
ED: Thanks Alain and hope to catch up with you soon,
AF: Absolutely. Thank you.