Startup Insights from a Highly Successful Serial Entrepreneur
November 18, 2021
Ashish Bahl is an entrepreneur with the Midas touch… and he has the track record to prove it.
Having founded several significant ventures in e-Invoicing, debit routing, eCommerce, and the home banking industry, Ashish has achieved a remarkable ‘three-peat’ in terms of success in startups. Specifically, three of the firms Ashish founded were acquired by iXL, American Express, and First Data (now FiServ) for a cumulative $300 million.
He’s now gunning for a fourth.
KyckGlobal Inc. (kyckglobal.com) features a powerful cloud-based payments engine that streamlines the payment process for businesses by allowing them to pay contractors, customers, and employees with an array of emergent and traditional payment types. The KyckGlobal solution now boasts more than a dozen unique payment types, all of which originate from one point of reconciliation. The platform improves the payee experience with both speed and choice, while reducing overhead costs for the payer.
I recently asked Ashish to let me pick his brain about his formula for success, his entrepreneurial experiences, and the origin of KyckGlobal. And of course, to tap into his visionary genius, I also quizzed him about the future of payments.
Please provide a brief overview of your accomplishments, and your previous ventures. What’s your backstory?
Ashish: Background wise, I was one of the early guys at Accenture’s financial services strategy practice, and I was brought in to be one of the leaders when it was first formed in the late ’90s. Shortly after building the practice, I left to start my own internet consultancy focused on the intersection of financial services and a lot of the web trends at the time, including home banking, bill payment, stock trading, and insurance quoting.
Given the marquee clients we had picked up, a rapidly-growing internet services company called iXL swooped in and acquired us after less than one year of opening our doors. I vaulted to run iXL’s financial services practice, and we contributed to about 40% of the company’s revenue before going public in 1998, followed by a secondary in 1999.
Sensing that a lot of this was not sustainable because things were just growing way too fast, I exited in March of 2000, well before the crash. I then set up an e-invoicing company called Harbor Payments. We grew the business aggressively, and in 2006 American Express purchased the company. I was with American Express for a couple of years, and then in late ‘08 and early ‘09, I launched a company called Acculynk, which pioneered the use of the debit rails to do next generation payment transactions.
“The hardest decision is to pick a market that’s
big enough to make it worth your time.”
Acculynk grew very nicely with clients like Uber and Square. Our growth got the attention of First Data, which ended up buying Acculynk in 2017. I was on the First Data executive committee for about six months before the entrepreneurial bug came back to bite me! I began an evaluation of several concepts including cryptocurrency and immigrant banking, and I ended up pursuing a concept that ultimately became KyckGlobal.
It occurred to me at that time that there are lots of use cases when businesses want to pay consumers, but many of the payment methods are disjoined – prepaid cards, PayPal, ACH, Visa push debit. If you could put a wrapper on all of them and have one connection, one contract, one settlement, one reconciliation, one funding flow, then you’ve got something that really didn’t exist in the market.
KyckGlobal was the first company to come up with that model, and it’s been a fun and blurry run so far! We just had our three year anniversary, and it’s been absolutely amazing.
Could you go into more detail about the origin story of KyckGlobal, and touch on how ‘omnichannel disbursements’ play into that?
Ashish: Going back to 2018, gig economy companies were sprouting up everywhere: food delivery services, pet walking services, driving, rent a truck, you name it. Most of them were capitalizing on 1099 employees. Contract employees demand unique processes of the employer, and payroll companies really didn’t have a product for them. 1099 payments were done as Accounts Payable payments out of the big ERP systems: Workday, Oracle, and others. There was really no platform to service these folks – and the number of gig workers was growing like crazy.
So the initial business case for KyckGlobal was How do you get payment to gig workers? Some workers might want speedy payments, some are unbanked or underbanked, and some might want to be able to split payments to save money. They might even want to be paid on a prepaid card, to limit visibility on those funds. For instance, some rideshare drivers regard their gig income as supplemental, using it for discretionary expenses like spa days, football games, and the like.
Most banks weren’t able to deliver a service like this, so we wanted to create a conduit for bank and non-bank rails, and get money to these gig workers when they want it, and how they want it. The KyckGlobal platform does everything: It’s got the rails, it’s got the rules, it provides access for both the payer and the payee.
When we got KyckGlobal up and running in 2018, absolutely no one had what I now call ‘omnichannel disbursements’, allowing businesses to pay both banked and unbanked people in the United States with specialty needs. Now in 2021, our reach has expanded internationally to deliver omnichannel disbursements to more than 200 countries. We can do PayPal, we can do wires, we have International ACH, we can do Push to Debit Card with Visa and Mastercard. We can do cash pickup in every corner of the world. It’s a very powerful solution to the historical friction businesses encounter when making cross-border payments.
It’s great that you’ve found a gap in the market to serve gig workers. With that in mind, what are the best use cases for KyckGlobal, and what outcomes should customers expect to experience?
Ashish: With a gig economy company, the benefit that they would achieve is they only have to make one connection, one contract, one customer service experience, and they could service their gig workers.
The company doesn’t need to execute five, six, seven, deals with seven different payment providers, and their payees don’t have to deal with disparate service levels. That business signs one contract, one SLA, and they’re off to the races! And if they want, they can even do subscription pricing so everythings not à la carte. This allows them to budget everything across all the different rails. No one else in the market is doing it like KyckGlobal.
How has the pandemic affected your recipe for success at KyckGlobal?
Ashish: As you know, parts of the gig world have been absolutely crushed during the coronavirus pandemic. We twisted and turned into several other markets as a result. Fortunately, the awesome KyckGlobal team discovered other sectors where our platform could add value. One of them is bill payments. You pay your school tuition, your insurance premium, your gas bill, your cable service. All of these service providers periodically disburses money back to the consumer, for escrow payments, for deposits with subprime consumers in utilities and cable, for tuition refunds, for insurance claim payments. We’ve had great success there.
New opportunities are also appearing now as restrictions are loosening and the travel industry is springing back. Think of hotels, resorts, airlines – if you’re a disgruntled traveler, if they’ve lost your bag, the last thing you want is that hotel or plane voucher. You want to be paid to replace the items you lost. These payments are called appeasements, and they are another huge opportunity for KyckGlobal. We’re literally blown away by the magnitude of opportunity as the KyckGlobal team discovers new verticals!
Same with the growth of crypto. Suppose you’ve got money in a crypto exchange wallet, but how do you get it out? That’s a disbursement. A lot of ETFs recently came up with a crypto fund, and with Bitcoin now over $63,000, there are more and more general use cases.
What we’ve done is created one of those rare businesses that when we went to look for investment, we have something called a Total Addressable Market, we gave them X, and the true market actually turned out to be five times X!
So a lot of things just fell very nicely into place.
That’s an amazing trajectory – and a remarkable pivot in a time of crisis. Where do you believe digital disbursements are headed?
Ashish: I think there’s going to be a rapid move from point providers to integrated solutions providers.
A few years back, a handful of point provider companies sprouted up all over the place, saying ‘Hey, I know you can do ACH, but I’ll give you another payment type. I’ll give you the VISA rail’, or ‘I’ll give you the Mastercard rail.’
The thing is that there are 20 or 30 other point providers, so if you can’t add value beyond providing an incremental rail, your margins compress and it’s going to be very hard to stay in business. And a lot of those firms providing individual points are now gone or struggling.
We are an integrated provider, and we’re not just going to give you another rail. We’re going to give you a full solution. You want PayPal? You want a VISA? You want a cash option? No need to choose, because we’ve got it all.
KyckGlobal bundles our payment array with service levels, a single contract, one reconciliation back, a payer portal, a payee portal, and that’s the business that we want to be in. We add a lot more value for the payer, and we’re not living on ridiculously tight gross margins.
So with that in mind, is KyckGlobal in a race for the largest aggregation of payment types?
Ashish: I think for cross-border payments it’s all about different rails. Depending on which rails you use to get into which country, money moves faster, the fees are radically different. In the U.S., it’s going to be less about the rail count and more about value-added functionality: can your platform split payments? Can the payer segment payees? Can the payer create a separate approval process for higher dollar payments? With KyckGlobal, the answer is yes, yes, and yes.
What’s next for KyckGlobal specifically?
Ashish: I think we want to be a force to be reckoned with in cross border payments, and soon we’re going to add a lot of local schemes.
A local scheme is a debit network within a particular country that provides instantaneous payments. In China it’s UnionPay, in India it’s RuPay, in Canada it’s Interac, in Brazil it’s Elo. We have plans in place next year to start tapping into all of these.
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What’s your advice for todays’ entrepreneurs on how to make their company a success?
Ashish: I think the hardest decision is to pick a market that’s big enough to make it worth your time. The total addressable market has got to be worth your while. When choosing a market, it’s got to be something that’s sizable. If it’s not sizable, and you spend all this time and effort differentiating and dominating the niche, you’re going to dominate a market that’s worth 50 cents… that’s simply not a good use of time!
Then you need a leadership team of four to six people that eat and breathe the company culture, to ensure they and everyone else is on the same page. We don’t ever have to ask questions like ‘Are you doing the right thing? What about this, what about that?’.
Once everyone is on the same page, and when you have a powerful force all pulling in the same direction toward this huge market that’s apparently wide open, a lot of good things are going to happen. You can quickly take that company to 100-200 people.
So over the course of Acculynk, Harbor Payments, and now KyckGlobal, those are the biggest lessons learned.
I sincerely appreciate your insights. Your passion for your work is abundantly clear.
Ashish: It’s been my pleasure! I am very passionate about entrepreneurism and have devoted my life not only to my businesses, but also to helping others achieve success in business. If folks would like to learn more or get in touch, I hope you’ll visit my website at www.ashishbahl.com or reach out on LinkedIn.