It's incredibly impressive that WePay has managed to differentiate itself and stay independent in the credit card API / marketplace payments space. Balanced seemed to have dramatically higher mind share and felt compelled to shut down.
I've been asked to explain WePay's place in the market before and have been unable to - I'm not sure if their risk / chargeback protection is what puts them over the top, great BD people, I'm not sure. However, assuming their funding is a sign of progress, they're doing something right despite stiff, direct competition and that's awesome.
We keep a relatively low profile, since we focus primarily on marketplaces & platforms with >$10m in annual payment volume and take a pretty deep, enterprise approach with our customers vs focusing on a broadly available, self-service developer platform. One day we hope to get there too, but for now we like to go narrow and deep for the sake of focus and providing a killer customer experience.
As far as product differentiation, we focus on marketplace fraud & risk management above all else. It's a tough problem to solve - most fraud systems are built to protect retailers from bad buyers, but the most insidious fraud risk on marketplaces is from bad sellers. We guarantee our customers against this type of loss while still providing a great overall UX.
(WePay employee here) One thing we have spent a lot of time working on is protecting our marketplaces and their customers from regulatory risk, which is something not a lot of people think about. We've noticed the card companies are focusing the Eye of Sauron on PayFacs in the last several months, and consequently their customers. We have spent the better part of last year ensuring that all our ducks are lined up in terms of ensuring that our customers are on the right side of the regulations, and now it's paying off.
WePay has managed to differentiate itself and stay independent in the credit card API / marketplace payments space..
I've been asked to explain WePay's place in the market before and have been unable to
Because contrary to your first statement about WePay "differentiating" itself, it didn't. There has been little to zero differentiation among the companies who make money moving money around, skimming "2.9% +0.30" off the top every time.
What's happening here with this funding round says nothing about WePay being special or different... this is merely evidence of consolidation. If there's no true disruption, cartel entities that elect to cooperate tend to squeeze each other out on a LIFO basis -- "Last In First Out". The cartel gets bigger and stronger as it melds into an monopolistic oligopoly.
WePay just happened to be one of the first players, which is probably why it survived. Stripe and Balanced soon thereafter had an opportunity to strike out and differentiate (yes, on pricing; because when your product is money nothing else matters) they were both weak and chose to assimilate into the amoeba matching pricing, not challenging it.
HN is well aware that there's now one fewer player in the cartel with Balanced ... um, a sinking ship. Yeah, they threw me overboard (http://ink.hackeress.com/2015/01/why-im-boat-rocker.html), and I'm not surprised the LIFO model is playing out as expected. The Balanced engineers I worked with were all awesome, and we had the smarts and tech to compete. But in order for the trend to be away from oligopoly -> monopoly, companies _have_ to let price be the factor that drives competition. Offer more for less, and you will win market share. Take the momentum away from the amoeba, not into it.
But they didn't believe me.
There's still a huge opportunity for anybody with the guts to do it. Crowdfunding / do-gooder sites that tend to raise money. Indie freelancers.. there are more than enough people who care about price of moving money enough to go low-cost over big and shiny.
Congrats Bill and team! Your success reminds me of Joe Siegler's anecdote about his career in the gaming industry:
> Long before I was hired to work at Epic Games, I emailed John Carmack and asked him what it took to get into the industry. His response consisted of a single sentence: "Talent will be rewarded."
This is awesome news for marketplaces who see the value in processing payments. Marketplace payments are a tough egg to crack and after meeting their CEO, Bill, and learning more of future plans, I think they're headed in the right direction.
I was an early WePay user back when they offered an online invoicing service. Was sad to see that go, but it was great while it lasted. Nice to see that they are having success in their new orientation.
Thanks for being an early customer. You can still use WePay to do online invoicing through one of our partners like Freshbooks (WePay Clear, our whitelabel product, powers Freshbooks Payments) or InvoiceASAP.
[+] [-] tomasien|11 years ago|reply
I've been asked to explain WePay's place in the market before and have been unable to - I'm not sure if their risk / chargeback protection is what puts them over the top, great BD people, I'm not sure. However, assuming their funding is a sign of progress, they're doing something right despite stiff, direct competition and that's awesome.
[+] [-] billclerico|11 years ago|reply
We keep a relatively low profile, since we focus primarily on marketplaces & platforms with >$10m in annual payment volume and take a pretty deep, enterprise approach with our customers vs focusing on a broadly available, self-service developer platform. One day we hope to get there too, but for now we like to go narrow and deep for the sake of focus and providing a killer customer experience.
As far as product differentiation, we focus on marketplace fraud & risk management above all else. It's a tough problem to solve - most fraud systems are built to protect retailers from bad buyers, but the most insidious fraud risk on marketplaces is from bad sellers. We guarantee our customers against this type of loss while still providing a great overall UX.
Happy to chat more! [email protected]
[+] [-] stevewepay|11 years ago|reply
[+] [-] shawnee_|11 years ago|reply
I've been asked to explain WePay's place in the market before and have been unable to
Because contrary to your first statement about WePay "differentiating" itself, it didn't. There has been little to zero differentiation among the companies who make money moving money around, skimming "2.9% +0.30" off the top every time.
What's happening here with this funding round says nothing about WePay being special or different... this is merely evidence of consolidation. If there's no true disruption, cartel entities that elect to cooperate tend to squeeze each other out on a LIFO basis -- "Last In First Out". The cartel gets bigger and stronger as it melds into an monopolistic oligopoly.
WePay just happened to be one of the first players, which is probably why it survived. Stripe and Balanced soon thereafter had an opportunity to strike out and differentiate (yes, on pricing; because when your product is money nothing else matters) they were both weak and chose to assimilate into the amoeba matching pricing, not challenging it.
HN is well aware that there's now one fewer player in the cartel with Balanced ... um, a sinking ship. Yeah, they threw me overboard (http://ink.hackeress.com/2015/01/why-im-boat-rocker.html), and I'm not surprised the LIFO model is playing out as expected. The Balanced engineers I worked with were all awesome, and we had the smarts and tech to compete. But in order for the trend to be away from oligopoly -> monopoly, companies _have_ to let price be the factor that drives competition. Offer more for less, and you will win market share. Take the momentum away from the amoeba, not into it.
But they didn't believe me.
There's still a huge opportunity for anybody with the guts to do it. Crowdfunding / do-gooder sites that tend to raise money. Indie freelancers.. there are more than enough people who care about price of moving money enough to go low-cost over big and shiny.
[+] [-] eberfreitas|11 years ago|reply
In Brazil we have a lot of companies trying to fix the money problem, but none seems to have the sophistication that you may find in Stripe or WePay.
If you are from Brazil and knows any companies like that, I would like to know!
[+] [-] coffeemug|11 years ago|reply
> Long before I was hired to work at Epic Games, I emailed John Carmack and asked him what it took to get into the industry. His response consisted of a single sentence: "Talent will be rewarded."
So happy to see your talent is being rewarded!
[+] [-] joeblossom|11 years ago|reply
[+] [-] throwaway12357|11 years ago|reply
And am I correct with assuming that WePay does money transfer using the bank account number instead of the Visa/Mastercard card number? Related [1]
[1] http://en.wikipedia.org/wiki/WePay#Occupy_Wall_Street
[+] [-] ams6110|11 years ago|reply
[+] [-] billclerico|11 years ago|reply
[+] [-] JoelJacobson|11 years ago|reply
[+] [-] netcan|11 years ago|reply
[+] [-] gargarplex|11 years ago|reply
[+] [-] danoc|11 years ago|reply