Wow, I'm a little surprised to see this for two reasons:
1. Doing anything financial in Australia is hard. For better or for worse (IMHO it's mostly better) there is strict financial regulation in Australia (mostly due to the Corporations Act revamp under the Howard government as well as the longstanding Trade Practices Act, which is one of the most consumer-friendly pieces of legislation I think in the world).
I'd be interested in knowing the story and how high compliance costs are for something like this.
2. It was done (based on comments here) at least in part in Perth. Perth is my home town and has become increasingly tech unfriendly for three reasons:
- a lot of the bigger employers got bought out and consolidated their software development over East;
- the state as a whole is very focused on digging stuff up from the ground (or under the sea to be pedantic) and selling it to the Chinese. The startup scene is tiny; and
- cost of living in Perth is terrible in wage-adjusted terms. Honestly it's cheaper for me to live in New York (I moved here about 2.5 years ago to start a job with Google). Housing is a huge part of it but food, utilities and, well, everything is expensive in Perth now.
I'd certainly like to here more about the development story and the team (the site is scant on details on this).
As for the service itself, I'll echo the comments of others and say the FX and other fees coule make this quite expensive.
Still, good to see this coming out of Australia and good luck guys. I'm also glad to hear about more tech things happening in Perth. I might have to check out the meetups and stuff next time I visit.
From Brisbane, Queensland here and it's a similar story here. The company I work for is causing ripples in the Australian pond but as a whole the Australian tech scene is way behind that of the states and other parts of the world due to our tight regulations, expensive Internet connections and slow Internet connection speeds.
For every successful Australian company I can think of, there are thousands not so lucky. Atlassian and Envato are the only two companies I can think of off of the top of my head who have had major success spawning web based businesses in a country as small and somewhat lacking as Australia as Australia is. Melbourne and Sydney are definitely two locations you're most likely to start a successful business in. Good to see Pin tackling payments because in Australia you have two options: Paypal or a propriety expensive bank solution with horrible API.
On the emergent 'Australian regulators are pain' meme, I actually emailed one of the bodies and requested documents regarding the decision not to adopt IIBAN, a useful and intelligent account identification scheme now used throughout Europe, Israel, and a growing list of other countries, within Australia. Their reply was essentially 'it happened in some meeting', followed by 'ignore' when I pushed for further information.
I suspect the real reason the status quo was protected was something to do with a brilliant track record of globally high fees and unending profits for Australian banks.
Hopefully the Wikileaks Party can put the fear of transparency in to these people!
There's almost nowhere with low COL and good access and reasonable amenities, though. Whereas in the US, small towns are still pretty well connected to the rest of the country with a solid interstate highway system and excellent freight rail, with decent basic amenities available everywhere, and high speed internet access, small towns in Australia can have crippling remoteness in an already remote country. For example, family in Ballarat, which is a regional Victorian town about an hour from Melbourne (it's not very remote; many people commute to Melbourne every day via rail), can only get wireless 3G internet access to their suburban house. I know the NBN will change some things, but they will most likely remain wireless.
And the smaller cities aren't going to be much cheaper, either. The median house price across all of Australia is around $500k (!).
As an Australian, I welcome this wholeheartedly. It has been extremely frustrating watching the payment revolution in the states, whilst at home there is next to no alternative to getting a merchants facility through a bank up until now. It will also be nice dealing with an API that isn't stuck in the 90s.
I love that this is happening and this innovation is extremely important in the Australian market.
However, if you're an Australian company that wants to deal exclusively or largely in USD -- then you need to keep an eye on the cost.
Pin is offering $50/month ($9 promo atm) - then 3% and $0.30 on every transaction. Then for foreign exchange there is "a retail foreign exchange rate of 4% on top of the wholesale interbank rate at the time of the transaction"
https://pin.net.au/pricing
Plus if you've got USD outgoings - e.g. paying for EC2 - you'll cop the foreign exchange on the way out too.
All of these things chip away & can add up to quite a considerable overhead.
Th $50/month really is a trivial cost to any business larger than a couple of people, particularly for a service which eases the intake of money. It's the per-payment costs that you need to consider. A flagfall charge of 30c is meaningless when your invoices are $1k, and very high when they're $10. 3% on every transaction might sound a lot, but (I assume) that includes the credit card company cut, which usually comes in at around 2%, so effectively it's a 1% fee for the service.
Forex is beyond me, and that's where it does get complex :)
After paypal shutting down my account on a number of occasions while organising campjs.com, we switched from Paypal+EventBrite to Pin+Tito and it's been smooth sailing ever since. The Pin team has been a joy to deal with, responsive to feedback and I highly recommend them. Congratulations to Pin.
Been watching these guys closely for the past 8 months or so.
These guys are based out of Perth, Australia and offer some pretty compelling prices, especially the email they sent them morning where their monthly pricing went down to $9 a month (instead of $50).
For those who don't know, Perth is the most remote city in the world (according to Bill Bryson), and has a population shy of 2 million mostly in a sprawl that hugs the coast.
I spent over a month there and a couple of weeks exploring the area around Margaret River, lovely place... but reading this, what strikes me is how hard it must be to find support, raise money, and build a startup with reach in a city of such remoteness and with only a limited pool of angels and tech resource to call upon.
So... knowing the city and WA as briefly as I do, I think this startup would probably have a good story behind it about the adverse environment (for startups) in which they emerged and what it took to get to where they are, and where they're going from here.
I have been testing with these guys as we get closer to releasing our service and they have been great to deal with. Not having to worry about a merchant account saved a lot of time when it came to paperwork and the integration is very simple.
The payments sector has been awaiting a shakeup in Australia for some time now, and Pin will definitely be a recognizable force moving forward.
Congrats on the launch and thanks for the lowered monthly fee!
Would you be able to do a more complete writeup of what you did (setting up EIN, getting a bank account, etc.) and all the implications (especially tax)? I've seen one person do such a thing to a limited degree and I've got the gist of the process myself, but I'd really like to see more info about this sort of thing.
There's one point in favour of Pin, though: easy setup. For side-projects, $9/month and have an ABN is comparatively little, where going through creating a merchant account alone---let alone the other requirements---is a big deterrant and thus, I think, quite harmful to this micro/experimental online business sector. My plan is basically use Pin while it's the cheapest and simplest, then when my business has demonstrated viability, go for the cheaper, more complex option. (Naturally this is dependent upon having a fairly-high-margin business.)
Is it possible to have USD payments deposited in my account directly without having currency conversion inside Pin? My bank account (Citibank Australia) tends to be significantly cheaper when depositing in USD than when gateways convert and charge their own conversion fee.
I know nothing about Pin's business model, but I bet the answer is "No" - in most processors like this, foreign exchange is what actually makes the profit for the company.
The $50/$0.30/3% you pay will cover expenses and make a bit of money, but the margins are pretty tight on that part of the transaction - it's all the FX leveraging/charging they do with your non-AUD income that actually makes the company viable.
That was my feeling too. $600/year for what is at present a spare-time project and not complete (thus, not ready to accept payments) was putting me off; $108/year is sufficiently low that I'm pretty confident I'll be signing up in the next month... then there's the added benefit of the incentive that will give me to get something worth paying for up quickly to make it financially worthwhile. :-)
And then for any further side-projects... I'll already have the low-maintenance account. Great!
This is great news. I've been patiently waiting for Stripe to arrive, but I've started to lose hope. Pin looks like it will fill that void. Can use a standard customer savings account to receive payments?
Great stuff! Good to see this coming out of Perth and hopefully they can get a good foothold on the market from support of businesses here before the bigger US/EU competitors (finally) arrive.
I would not be amazed if this reflects the upstream cost structure from NAB, their bank. Merchant accounts generally have monthly fees + percentages + fixed per-transaction costs.
Even with the $50 fee it is still much, much cheaper and easier than anything else available here in Australia (which is basically to get eWay + a merchant account).
I am very that excited this came through and am doubly grateful for the $9 offer they're doing.
I'll have to get a sole trader ABN to be eligible to use it but I suspect it will be worth it.
I would still think that Braintree would be a better bet.
They abstract the bank part of the equation as well so you are just dealing with a single entity for any issues that arise. Plus their pricing is a little bit better:
First, congratulations to the Pin team. However I wonder about the longevity of companies that are essentially Stripe clones in unsupported countries. Their business essentially depends on the fact that Stripe is not currently in Australia. Once Stripe announces support for Australia, why would anyone choose Pin over Stripe?
Apparently our financial regulations are an obtuse, onerous nightmare to deal with. I imagine even just getting setup here is a big head start. Google Merchant have been expanding for years but are still ignoring Australia, so thank you Pin
I would imagine that it would be much easier for Stripe to acquire local Stripe equivalents and rebrand, rather than trying to navigate the labyrinth of financial regulations in each location. Maybe that's the game plan for Pin?
From another Perth guy, more congrats to the Pin team (I actually discovered them when I had the same idea, googled it and found that it existed already - in my own town!)
If Stripe was thinking about moving into the Australian market, Pin would provide them a ready-made solution. All things equal, this startup has a high chance of getting acquired/ merged.
Don't even get me started... PaymentExpress demanded we sign a 3 year contract to move off their "starter" plan. This is after them stuffing up our recurring billing for 6 weeks late last year. Cost us thousands.
Told them to jam it, in the process of moving to Pin as we speak.
[+] [-] cletus|12 years ago|reply
1. Doing anything financial in Australia is hard. For better or for worse (IMHO it's mostly better) there is strict financial regulation in Australia (mostly due to the Corporations Act revamp under the Howard government as well as the longstanding Trade Practices Act, which is one of the most consumer-friendly pieces of legislation I think in the world).
I'd be interested in knowing the story and how high compliance costs are for something like this.
2. It was done (based on comments here) at least in part in Perth. Perth is my home town and has become increasingly tech unfriendly for three reasons:
- a lot of the bigger employers got bought out and consolidated their software development over East;
- the state as a whole is very focused on digging stuff up from the ground (or under the sea to be pedantic) and selling it to the Chinese. The startup scene is tiny; and
- cost of living in Perth is terrible in wage-adjusted terms. Honestly it's cheaper for me to live in New York (I moved here about 2.5 years ago to start a job with Google). Housing is a huge part of it but food, utilities and, well, everything is expensive in Perth now.
I'd certainly like to here more about the development story and the team (the site is scant on details on this).
As for the service itself, I'll echo the comments of others and say the FX and other fees coule make this quite expensive.
Still, good to see this coming out of Australia and good luck guys. I'm also glad to hear about more tech things happening in Perth. I might have to check out the meetups and stuff next time I visit.
[+] [-] DigitalSea|12 years ago|reply
For every successful Australian company I can think of, there are thousands not so lucky. Atlassian and Envato are the only two companies I can think of off of the top of my head who have had major success spawning web based businesses in a country as small and somewhat lacking as Australia as Australia is. Melbourne and Sydney are definitely two locations you're most likely to start a successful business in. Good to see Pin tackling payments because in Australia you have two options: Paypal or a propriety expensive bank solution with horrible API.
[+] [-] contingencies|12 years ago|reply
I suspect the real reason the status quo was protected was something to do with a brilliant track record of globally high fees and unending profits for Australian banks.
Hopefully the Wikileaks Party can put the fear of transparency in to these people!
[+] [-] joonix|12 years ago|reply
And the smaller cities aren't going to be much cheaper, either. The median house price across all of Australia is around $500k (!).
[+] [-] marcloney|12 years ago|reply
As an Australian, I welcome this wholeheartedly. It has been extremely frustrating watching the payment revolution in the states, whilst at home there is next to no alternative to getting a merchants facility through a bank up until now. It will also be nice dealing with an API that isn't stuck in the 90s.
[+] [-] kibibu|12 years ago|reply
edit: apologies, I didn't realize braintree required a merchant account as well.
[+] [-] jwilliams|12 years ago|reply
However, if you're an Australian company that wants to deal exclusively or largely in USD -- then you need to keep an eye on the cost.
Pin is offering $50/month ($9 promo atm) - then 3% and $0.30 on every transaction. Then for foreign exchange there is "a retail foreign exchange rate of 4% on top of the wholesale interbank rate at the time of the transaction" https://pin.net.au/pricing
Plus if you've got USD outgoings - e.g. paying for EC2 - you'll cop the foreign exchange on the way out too.
All of these things chip away & can add up to quite a considerable overhead.
[+] [-] vacri|12 years ago|reply
Forex is beyond me, and that's where it does get complex :)
[+] [-] ra|12 years ago|reply
[+] [-] secoif|12 years ago|reply
[+] [-] thejosh|12 years ago|reply
These guys are based out of Perth, Australia and offer some pretty compelling prices, especially the email they sent them morning where their monthly pricing went down to $9 a month (instead of $50).
They use ruby on rails, and offer a JSON API.bEE
[+] [-] buro9|12 years ago|reply
For those who don't know, Perth is the most remote city in the world (according to Bill Bryson), and has a population shy of 2 million mostly in a sprawl that hugs the coast.
I spent over a month there and a couple of weeks exploring the area around Margaret River, lovely place... but reading this, what strikes me is how hard it must be to find support, raise money, and build a startup with reach in a city of such remoteness and with only a limited pool of angels and tech resource to call upon.
So... knowing the city and WA as briefly as I do, I think this startup would probably have a good story behind it about the adverse environment (for startups) in which they emerged and what it took to get to where they are, and where they're going from here.
[+] [-] jscn|12 years ago|reply
[+] [-] toast76|12 years ago|reply
[+] [-] djtidau|12 years ago|reply
The payments sector has been awaiting a shakeup in Australia for some time now, and Pin will definitely be a recognizable force moving forward.
Congrats on the launch and thanks for the lowered monthly fee!
[+] [-] z0s0123|12 years ago|reply
So the actual pricing is more like $9/mo + .30 + 7% for any non AUD business.
We use Stripe, a Bank of America USD account and OANDA to move our USD -> AUD with an FX commission ~ 0.1%.
[+] [-] chrismorgan|12 years ago|reply
There's one point in favour of Pin, though: easy setup. For side-projects, $9/month and have an ABN is comparatively little, where going through creating a merchant account alone---let alone the other requirements---is a big deterrant and thus, I think, quite harmful to this micro/experimental online business sector. My plan is basically use Pin while it's the cheapest and simplest, then when my business has demonstrated viability, go for the cheaper, more complex option. (Naturally this is dependent upon having a fairly-high-margin business.)
[+] [-] beefsack|12 years ago|reply
[+] [-] JimmyL|12 years ago|reply
The $50/$0.30/3% you pay will cover expenses and make a bit of money, but the margins are pretty tight on that part of the transaction - it's all the FX leveraging/charging they do with your non-AUD income that actually makes the company viable.
[+] [-] jacques_chester|12 years ago|reply
That said, foreign currency accounts are usually expensive. Westpac quoted me a $60/mth account keeping fee.
[+] [-] robryan|12 years ago|reply
[+] [-] davidlumley|12 years ago|reply
[+] [-] chrismorgan|12 years ago|reply
And then for any further side-projects... I'll already have the low-maintenance account. Great!
[+] [-] dcw303|12 years ago|reply
[+] [-] thejosh|12 years ago|reply
[+] [-] sbennettmcleish|12 years ago|reply
[+] [-] nwh|12 years ago|reply
Uh, and they also don't support 2FA on their login form; that's not going to end well.
[+] [-] jacques_chester|12 years ago|reply
Welcome to Australian banking.
[+] [-] regecks|12 years ago|reply
I am very that excited this came through and am doubly grateful for the $9 offer they're doing.
I'll have to get a sole trader ABN to be eligible to use it but I suspect it will be worth it.
[+] [-] nagash|12 years ago|reply
[+] [-] thejosh|12 years ago|reply
And that's Australian Banking. Alternatives are even more pricy..........
[+] [-] daurnimator|12 years ago|reply
[+] [-] threeseed|12 years ago|reply
They abstract the bank part of the equation as well so you are just dealing with a single entity for any issues that arise. Plus their pricing is a little bit better:
https://www.braintreepayments.com/pricing
That said ANY competition is always nice. The real question though is how they handle chargebacks.
[+] [-] kondro|12 years ago|reply
[+] [-] cstrat|12 years ago|reply
[+] [-] nodesocket|12 years ago|reply
[+] [-] coopdog|12 years ago|reply
[+] [-] intractable|12 years ago|reply
From another Perth guy, more congrats to the Pin team (I actually discovered them when I had the same idea, googled it and found that it existed already - in my own town!)
[+] [-] WatchDog|12 years ago|reply
[+] [-] bentoner|12 years ago|reply
[+] [-] capex|12 years ago|reply
[+] [-] rmccue|12 years ago|reply
[+] [-] jonemo|12 years ago|reply
[+] [-] regecks|12 years ago|reply
[+] [-] thejosh|12 years ago|reply
https://pin.net.au/docs/api
[+] [-] jacques_chester|12 years ago|reply
[+] [-] markdown|12 years ago|reply
[+] [-] toast76|12 years ago|reply
Told them to jam it, in the process of moving to Pin as we speak.
[+] [-] unknown|12 years ago|reply
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