Increase payment platform adoption by growing partner/client categories

419 views

Published on

This presentation describes a way for payment gateway firms to grow different business categories with an example and its benefits to both parties

Published in: Economy & Finance
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
419
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
9
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide
  • Lead aggregators – SubscriptionsSDKs – Developer integrationEmployee benefit providers – Benefit enablement via appsMass Transit –Tickets, passes, parking meters using appRetail Energy – Mobile appsAccounting software – IntegrationWallet - Street Vendors, Mom-pop retail, Duty-free
  • Increase payment platform adoption by growing partner/client categories

    1. 1. Increase Payment Platform Adoption by Adding Categories, Braintree Bhaskar Jayaraman: jay.bhaskar@gmail.com
    2. 2. Agenda • Glimpse of Braintree Partners & Clients • Current Partner/Client categories • Potential categories • Adding a new category, Mass Transit (CUBIC)
    3. 3. Upstream Partners Partners (Downstream) Current Partners Glimpse of Current Partners & Clients Clients (Downstream) Downstream – Platform integrators Upstream – Platform enhancers
    4. 4. ‒ e-commerce platforms (Shopify, Drupal, Goodsie) ‒ Hospitality (airbnb, HotelTonight) ‒ Online marketplaces (taskrabbit, livingsocial, Belly) ‒ Entertainment (AngryBirds) ‒ Niche verticals (GitHub, stackoverflow) ‒ Payment solutions (innerfence, levelup) ‒ Retail (Trunk Club, Fab, Poshmark) ‒ CRM (Belly) ‒ F&B (OpenTable) ‒ Social network platforms (FB) ‒ Blogging platforms (Wordpress) ‒ CDN (CloudFlare) ‒ CSP/ISP (serverdensity) ‒ SaaS (Animoto, Basecamp) Current Downstream Categories (Clients & Partners)
    5. 5. Potential Downstream Categories (e.g. in Appendix I) Clients (Direct categories) Those who integrate Braintree on their solutions - Entertainment - TV/Music/Gaming - Lead aggregators - Device/App SDKs - Smartphone/Tablet - Wearable platforms - Automobile dashboard - Mass Transit Vendors - Employee benefit providers - Mobile providers - Micro/Crowd Finance - Niche technology (QR Code, NFC, SMS etc.) - Retail Energy (Gas, Electric) - Wallet (Not fully thought through) - Accounting software Partners (Indirect Categories) Those who integrate Braintree on their platforms (e.g. Catering niche verticals in eCommerce, CRM) - Food - Finance - Video - Education - Pharma - Hotels - Airlines - Utilities - Wireless hotspots
    6. 6. Downstream – Next steps ‒ Grow each category ‒ Add more categories ‒ Fill gaps in platform
    7. 7. Current ‒ Processing partners (Wells Fargo) ‒ Underwriters/Financiers (Appleseed) ‒ Checkout Partners (Taxcloud) Upstream Categories Potential ‒ QR Code partners (Scan) ‒ NFC (Sequent) ‒ Augmented Reality (Layar) ‒ IVR ‒ SMS ‒ VoIP (Twilio)
    8. 8. Upstream – Next steps ‒ Document customer wish list to platform enhancement ‒ Add complementary categories
    9. 9. Adding a New Downstream Category, Mass Transit – CUBIC
    10. 10. CUBIC, quick look Business divisions ‒ Defense ‒ Transportation (Mass transit tech solutions) Financials ‒ Market Cap, $1.4 B ‒ Run rate Mar ’14, Approx $1.5B ‒ YoY Rev. Growth, Approx. $100M
    11. 11. CUBIC Transportation Division ‒ Revenue share 37% (Y 2012) ‒ Operations in – USA (HQ), Canada, Germany, Aus, Sweden, U.K., India ‒ Over $14 billion in revenues collected ‒ Vendor for SFMATA (BART, Caltrain, VTA, etc.)
    12. 12. Case – CUBIC Clipper, San Francisco New balance updated on Clipper 6. User scans Clipper with NFC on machine 5. When successful machine requests another Clipper scan 4. User swipes credit card to load amount required 3. User scans Clipper card with NFC on machine 2. User locates machine 1. User signs up Clipper Card Loading Process at Kiosk Machines – Reduced ridership when, 1. Trouble locating ticketing machine (only in big stations) 2. Waiting in queue (possibly missing connection) 3. Ticketing machine out of order 4. Fraud possibility (Card skimming etc.) 5. Choosing alternative transport (Uber etc.)
    13. 13. Proposal – Increase Ridership & Clipper adoption via Mobile
    14. 14. Braintree Proposal (e.g. using NFC) New balance updated on Clipper 5. User loads Clipper with NFC app on phone 4. When successful App directs Clipper scan 3. Employee uses App to load clipper 2. MUNI+ App saves info with Braintree 1. User loads visa card info on MUNI+ App Currently not in place possibly because of, ‒ CUBIC’s reluctance for PCI Compliance ‒ CUBIC’s concerns on smartphone Security and Malware
    15. 15. Recommended business structure ‒ CUBIC to own ‒ Decision On Technology (NFC, SMS, TCP/IP etc.) ‒ Integrating payment platform ‒ Development/testing of App on various phone platforms ‒ Production Release, & Maintenance of App ‒ Braintree to own ‒ PCI Compliance & Security (2 factor auth. etc.) ‒ API availability on various smartphone platforms ‒ Testing of APIs & Change Requests ‒ Braintree API compatibility & integration with CUBIC system ‒ Support Demonstration & Production Release of App ‒ Could potentially also include, ‒ Participation in Marketing and Awareness Campaigns ‒ Bringing more upstream partners on board (telecom, device, security, QR Code etc.)
    16. 16. Sustaining Categories via Product Enhancement ‒ Handle CUBIC’s ‒ Support enhancement requests ‒ Platform/API requests ‒ Platform enhancement requests (upstream partner tie-up needs) ‒ Propose ways of engaging product ‒ Via upstream partners (checkout, billing, accounting etc.) ‒ New ticketing mechanism (QR code)
    17. 17. Strategic and financial assessment
    18. 18. Clipper Usage & Braintree Opportunity Assumption based on SF Bay area ridership 5,149,230 Wikipedia Total number of active Clipper users 1,300,000 www.mtc.ca.gov Smartphone users 845,000 Smartphone user penetration 65% (Businessweek) Braintree revenue per smartphone user per transaction $0.30 Braintree revenue potential per month (assuming every user loads once per month) $0.30 x 845,000 = $253,500 Only smartphone users & if Clipper user loaded via NFC, SMS, etc. Braintree revenue potential per year for SF Bay Area $3 M $253,500 x 12
    19. 19. Total CUBIC Revenue Potential for Braintree Assumption based on CUBIC ridership worldwide 38 M per day www.cubic.com Number of smartphone + clipper riders 6.5 M Clipper usage 25% of total & smartphone penetration 65% Annual revenue potential $23.5 M $0.30 x 6.5 M x 12 (User loads once a month) Annual revenue potential for Braintree, when smartphone penetration approaches 100% $36 M 10 M x $0.30 x 12 Annual revenue potential for Braintree, when all CUBIC ridership approaches 100% on smart card use $136.8 M 38 M x $0.30 x 12 Total ridership in 2024 38 M + 6.33 M = 44.33 M 1.6% per year of base year 2014, WHO Annual revenue potential for Braintree in 2024 $160 M 44.33 M x $0.30 x 12
    20. 20. Questions?
    21. 21. Appendix I – Assessment of Braintree Proposal Advantages ‒ Clipper + Smartphone = Cool, Convenient ‒ Steps 1. and 2. are one time (slide 14) ‒ Six steps to three (3, 4, 5) ‒ Requires only one clipper NFC scan ‒ Less cost to install, maintain, upgrade machines Drawbacks ‒ Not all phones have NFC ‒ Not all users have smartphones ‒ NFC option open to abuse by hackers Workarounds ‒ Other NFC devices (wearables?) ‒ 2 factor authentication for NFC ‒ SMS ‒ TCP/IP (Web interface, Chat app) ‒ Over the phone Drawbacks of Workarounds ‒ SMS costs $$ ‒ Updates to Clipper card take 3-5 days ‒ via TCP/IP & Phone ‒ Possibly also via SMS, OOB
    22. 22. Appendix II – Potential Downstream Categories Partners (Indirect Categories) - Food (e.g. Mowingo, LAI) - Finance (e.g. Pareto) - Video (e.g. Zumobi) - Education (e.g. Serco) - Pharma (e.g. Sales Vision) - Hotels (e.g. Guestware) - Airlines (e.g. Mobiata) - Utilities (e.g. TIO Networks) - Wireless hotspots (e.g. ZyXEL) Clients (Direct categories) - Entertainment - TV/Music/Gaming (In app purchases on Roku, Xbox, Beatport) - Lead aggregators (e.g. Reply, Stik) - Device/App SDKs (Smartphone/Tablet, Wearables, Dashboard displays) - Employee benefit providers (e.g. Wagewokrs) - Mass Transit (e.g. CUBIC) - Mobile providers - Micro/Crowd Finance (e.g. m.Paani) - Niche technology firms (QR Code, NFC, SMS etc.) - Retail Energy (Gas, Electric) - Wallet (Not fully thought through) - Accounting software (e.g. Xero)
    23. 23. Appendix III – SF Bay Area Public Transport Ridership Agency Name Daily Ridership (www.wikipedia.org) Clipper? ACE 3,700 No BART 421,800 Yes Caltrain 47,060 Yes SMART — — Muni Metro 160,100 Yes VTA Light Rail 33,600 Yes AC Transit 236,000 Yes SamTrans 46,070 Yes MUNI 297,700 Yes VTA 107,900 Yes Golden Gate Ferry 5300 Yes Total Ridership 5,149,230 Total active clipper cards in circulation 1.3 M (www.mtc.ca.gov) or 25% of ridership
    24. 24. Appendix IV – Clipper Usage & Braintree Opportunity Assumption based on SF Bay area ridership 5,149,230 Wikipedia Total number of active Clipper users 1,300,000 www.mtc.ca.gov Smartphone users 845,000 Smartphone user penetration 65% (http://www.businessinsider.com.au/us-smartphone- penetration-ticks-up-in-the-fourth-quarter-2014-2) Average times balance is loaded per month Once Assuming they commute daily Average annual transport expense of household in SF $10,466 http://www.bls.gov/ro9/cexsanf.htm Average spent on public transport in SF 12.2% http://www.bls.gov/ro9/cexsanf.htm Amount spent on public transport per month $106 ($10,466 x 12.2%)/12 Total amount spent on transport by all riders per month $546 M 5,149,230 x $106 Total amount spent on commuter expense per month $273 M Assuming 50% goes to this and rest go to taxi and airplane travel Total amount spent by Clipper users per month on public transport per month $68.9 M $106 x 1,300,000 x 50% Amount spent on Clipper as a percentage of total ridership spend 25% = 68.9/273 Regardless of the money spent of clipper Braintree revenue per smartphone user per transaction $0.30 Braintree revenue potential per month $0.30 x 845,000 = $253,500 Only smartphone users & if Clipper user loaded via NFC & SMS & assuming every user loads once per month Braintree revenue potential per year for SF Bay Area $3 M $253,500 x 12
    25. 25. Appendix V – Total CUBIC Revenue Potential for Braintree Assumption based on CUBIC ridership worldwide 38 M per day http://cts.cubic.com/en-us/aboutus/companyfacts.aspx Active Clipper or similar smart card users worldwide 10 M per day Assuming 25% of all Number of smartphone riders 6.5 M Assuming average penetration of 65% Total number of times they load clipper card Once every month Revenue potential for Braintree via NFC/SMS solution per month $1.95 M $0.30 x 6.5 M Annual revenue potential $23.5 M $1.95 M x 12 Annual revenue potential for Braintree, when smartphone penetration approaches 100% $36 M 10 M x $0.30 x 12 Annual revenue potential for Braintree, when all CUBIC ridership approaches 100% Clipper or similar smart card use $136.8 M 38 M x $0.30 x 12 Ridership growth annually (2010, 50% people lived urban areas & by 2030 this will be 60%) by 1.6% per year of base year (2014) Extrapolated using data from - http://www.who.int/gho/urban_health/situation_trends /urban_population_growth_text/en/ Total ridership in 2024 38 M + 6.33 M = 44.33 M 1.6% per year of base year (2014) Annual revenue potential for Braintree in 2024 $160 M 44.33 M x $0.30 x 12

    ×