Adam Nanjee, Head of Financial Technology at MaRS Discovery District

Adam's Bio:

Adam Nanjee is the Head of the FinTech cluster at MaRS. Adam brings an extensive background in digital payments and financial technology infrastructure to MaRS, and is actively involved in Toronto’s startup, venture capital and accelerator communities.

Adam joined MaRS from MasterCard Canada, where as vice president of business development in emerging payments, he drove the company’s strategy and partnerships in the digital payment space. Additionally, Adam was a member of MasterCard’s corporate development and competitive intelligence groups where he was responsible for identifying Canadian-based startups within the financial technology vertical for investment and acquisition opportunities. Prior to MasterCard, Adam held the position of Global Head of Social Networking Partnerships at BlackBerry. Spending a majority of his time in Silicon Valley, Adam was responsible for the overall strategic direction and relationship between BlackBerry and various global social networking companies including Facebook, Twitter and LinkedIn. Previously at BlackBerry, Adam led the eCommerce partnerships group, developing partnerships with Amazon, eBay and Visa.

Adam holds an MBA from Wilfrid Laurier University, and holds an honours engineering degree in computer and systems engineering from the University of Guelph.

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I was leading a workshop recently about the best ways to improve the performance of your financial management and how to get more out of working capital. It was going well but I tried to increase the engagement in the room by asking the participant’s for help. I explained that I was going to write an article on the very same topic and wanted them to come up with a joke I could use in it. The joke had to be along the lines of ‘what’s the best way to…’

You’ll find it at the end of this piece and it relates to what I believe is the best way to improve your financial management.

I think there are benefits which organisations can achieve by developing relationships between buyers and suppliers. When people think about the way to make life simpler and enhance control, they default to things like e-invoicing or card payments. These have been a solid and dependable method for years but they are being overtaken with solutions which are cheaper, faster and quite simply better.

To start, lets take a look at some of the characteristics of both.

B2B card payments…can it exist in its current form?

There can be more than meets the eye when setting up to become a merchant and receive card payments. Firstly, the mere mechanics of getting everything started can be time consuming. There’s the simple stuff like getting a broadband line in place but the big job is the investment in integration with the supplier’s back office and stock systems. This is critical to enable level 3 tax data to flow back to the buyer’s card statement and can take considerable effort to get it up and running. Not only that, you’ll have the upfront fees for the card terminal and ongoing rental costs.

Next is the risk assessment. There can be lengthy contract negotiations with the acquirers and some industry sectors are seen as more risky which will attracts higher fees, larger minimum transaction volumes and penalties. You may be running a tight ship and see yourself as having a low credit risk but that’s no good if you’re in the wrong sector. And, if you are becoming a direct card accepting merchant it can cause problems with your banking covenants and impact your finance options and overdrafts. The result? It all adds up to higher fees, longer settlement terms and disruption to your existing arrangements.

The whole setup process can take three months and drain time and energy away from other projects. Plus, there is no guarantee that suppliers will use the card to pay.

So what are the options?

E-invoicing – the way forward? An alternative might be e-invoicing. It’s a recognised way to improve the efficiency of B2B payments and processing speed. It increases the efficiency, reduces errors, and means you have straight through processing. But there are things to keep in mind. For the buyer, it means getting an e-invoicing program set up in the hope that all suppliers will join. For the supplier, they may be asked to sign up to several different networks and it can seem like a big job they can do without. There’s a setup fee, charge per transaction and no guarantee that they will get paid on time.

There’s a new way to look at this problem… So, what are the alternatives? In the workshop I was outlining how technology has moved on and how some organisations have ripped up the usual approach and built a completely new process. There are several companies out there and we are part of that club.

Our payment system offers functionality which overcomes many of the problems with B2B payments. The first is the registration process and set up. This happens by email from the Invapay system. All you need to do is simply put in the contact details of your suppliers and an email is fired out to them. They add several bits of information into the Invapay portal, such as VAT, address and bank details. Their registration can happen in the time it takes to make and drink a cup of tea. This data powers our background checks on the company you’re dealing with. KYC and set up can happen faster and without the fuss – it’s a five minute process.

Plus, there are no set up fees or integration requirements. Everything is cloud-based, you only pay when you trade and everything can be configured by the user. You can even set up early settlement discounts which gives you the opportunity to lower your costs and enables suppliers to benefit from the technology, too. With lower fees and enhanced data in the form of level three transactions you can quickly achieve greater efficiency.

So, back to the workshop. I started by talking about the best way to improve the performance of your financial management and how to get more out of working capital. There’s no magic wand and no single solution. I believe it is all about breaking down the value chain, and each process within, into small parts. Then, you can look for ways to improve in each area, little by little. The sum of the incremental improvements quickly adds up and you will yield big savings and efficiency.

We think the B2B payments process is one of the areas where you can win big. If you’ve got this I’ll close with the joke. Apologies in advance…it’s not a classic but was the best fit with the theme.

Here it is… What’s the best way to carve wood? Whittle by whittle.

I’ll get my coat

Here are the links to the presentations and bios we received from the speakers and panelists. They are listed in the same order as the agenda for the event.

Moderator - Paul Puey - Airbitz Inc - Bio

Panelist - David Ripley -Glidera Inc. - Bio and Presentation

Panelist - Sarah Hody - Coinbase - Bio and Presentation

Panelist - Scott Bambacigno - AlphaPoint - Bio and Presentation

Speaker - Daniel Chatelain - The BayPay Forum - Bio and Presentation

 

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Peter Donat, SVP at First Data Ventures

Peter's Bio:

Pete Donat is currently SVP of First Data Ventures, a group responsible for leading First Data’s efforts to harness innovation by partnering with small innovative companies who can leverage First Data’s processing assets and unmatched distribution to drive solutions that delight our customers and materially grow long-term revenue.

He is also responsible for network business development, responses to major regulatory events (e.g. Durbin I & II), managing several of the company's non-traditional partnerships. Previously, held senior management roles in Business Development, Innovation and eCommerce. He led the 2013 opening of FDC’s Palo Alto office. From 2004-09 he was VP of Enterprise Planning & Corporate Strategy at Visa - with responsibilities for long-term planning, competitive intelligence and Visa International's restructuring and IPO. From 1997-2004 he held a variety of senior management roles at MasterCard. He was VP of Product/Change Management with responsibilities for product strategy across credit, debit, prepaid, P2P programs - and regulatory risk management. He headed e-Business Development, where he implemented EMV, Mondex, internet security, PayPass, m-commerce, and prepaid solutions. Earlier, he led MasterCard’s Corporate Planning team. Prior to MasterCard he was a management consultant at Marakon Associates and a political hack on two Al Gore campaigns.

He has an MBA from Wharton, a Masters in International Economics and American Foreign Policy from Johns Hopkins SAIS, and a BA from Dartmouth. He serves as Board advisor to several payment and security startups and was previously a Trustee of the World Affairs Councils in Northern California and Connecticut. He is an avid 49er season ticket holder, a slow moving backpacker, a proud father, and an aspiring wine snob.

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http://www.visa.com.au/business/corporate/b2bpaymentsreport.shtml

Of the 150 organisations surveyed, 90% were large commercial businesses and 10% were public sector organisations.

• The survey included a roughly equal split of users and non-users of cards.
• The survey was conducted by Deloitte in 2015.
• It focused on both buyers and suppliers.
• 100 of respondents were based in Australia and 50 in New Zealand. 
• The median revenue/budget was A$67m in Australia and NZ$65m for New Zealand.
• Median company size was 610 employees.
• The top industries represented in the private sector were Agriculture, Mining & Construction, Manufacturing, and Wholesale & Retail Trade. 
• The primary responding individuals were Chief Financial Officers, Accounts Payable Managers, Procurement Managers, Shared Services Managers, and Finance Directors.

Conclusion is simple - CFO's & Treasurers must act now.

David Ripley, Co-Founder and CEO at Glidera Inc.

David's Bio:

Dave Ripley is the Co-Founder and CEO of Glidera Inc., a digital currency venture with headquarters in Chicago, IL. Glidera offers a bridge to the existing financial system for digital currency developers. Using Glidera’s service, Bitcoin wallet and other application developers can directly integrate Bitcoin buy and sell services into their applications. End users can then easily obtain and convert Bitcoin using the wallet or application of their choice. Dave brings more than 15 years of diverse business experience to Glidera. He has worked across multiple industries including technology and financial services. Most recently, as Principal for The Boston Consulting Group (BCG), Dave advised C-level executive teams of Fortune 500 corporations. Previous to his time at BCG, Dave held roles in software engineering and product management with Syclo, a mobile enterprise software company (acquired by SAP in 2012). Dave received his MBA from the Kellogg School of Management (Northwestern University) and his BS in electrical and computer engineering from the University of Illinois (Urbana-Champaign).

Event Presentation: