Greg: Hello, this is your host, Greg Myers, and you are listening to the Leaders in Payments podcast. This is Episode 12 featuring my special guest, Brad Wiskirchen, the CEO of Kount. Brad talks in detail about the Identity Trust Global Network program that count recently launched. He provides some great information about Kount and what they’re doing to help their employees and customers during this global crisis. Brad also talks about his love for the team at Kount and his passion for his family. He also gives some great advice to those who are just starting out in the payments industry. So, let’s get started.
Hi Brad. Thank you for being here and welcome to the Leaders in Payments podcast.
Brad: Thanks for having me. I’m glad to be here.
Greg: Great. If you don’t mind, tell our audience a little bit about yourself. Maybe where you grew up, where you’re from, where you went to school, where you currently live. Maybe a few things like that.
Brad: I was actually born in Boise, Idaho, but raised all over the country. I lived in Utah, Arizona, Missouri, Illinois, kind of everywhere and spent a couple years in Switzerland and spent some time in London while I was in school. I went to undergrad at Brigham Young University and Law School at the University of Notre Dame because I wanted to be religiously ambiguous and I now live in Boise, Idaho, back to where I was born.
Greg: Great. So, let’s jump in and discuss Kount. So, tell us, what Kount does.
Brad: Kount is the leading Fraud Control Company in the world. We provide fraud prevention services for some of the largest brands of merchants, payment processors, acquiring banks and gateways across the globe. Really, on every continent. We provide the services for financial transactions, payments, fraud for account creation fraud, account takeover fraud, the entire spectrum of fraud control needs that a company may need. In fact, we provide the fraud control for some of the companies whose CEOs have already been on your program like BlueSnap. I know Ralph Danglemaier was on your program previously. So, we provide it for folks like him, Barclays, Chase Paymentech, Moneris, companies all over the world.
Greg: Okay. And all of it is related to e-commerce?
Brad: Its anything, card not present, not necessarily e-commerce. So, anything that is card not-present we can do. We actually have some clients who uses for card present transactions, but not a lot, because as the card brand rules go, they’re not liable for those transactions. And they also use this for account creation, insurance companies use us for new applications, etcetera.
Greg: OK, how big is the company?
Brad: We are right about 170 people. We’ve very fortunate. We’ve created a company that’s easily scalable and so we don’t have to have a lot of bodies in order to scale the company. But we also have over 6,500 customers globally. We have about 32 billion annual interactions in over 75 plus industries and we are the fraud control solution for over 50 payment processors around the world, some of which I just noted, and we see transactions in over 250 countries and territories on any given day.
Greg: Great. So, I did read recently that you launched something called the Identity Trust Global Network. Can you talk about that a little bit?
Brad: Absolutely. So, Kount uses adaptive artificial intelligence, and we link billions of fraud and trust signals together in real-time. And we do that for fraud prevention and for account takeover protection and really, for personalized customer experiences. We’re able to provide an appropriate amount of data to our customers at the right time in their interactions with their end consumers. In order for them to not just identify if someone’s a fraudster, but also to enable them to get details on the nature of their consumers in order to help them make that shopping experience or whatever the interaction is that they’re having with them optimized and increase the likelihood that it’s a success, however they deem or define success.
Greg: Okay, talk a little bit about account takeover. I think that’s something that some people may not know the term, and some may but maybe talk about that a little bit and what you guys do there.
Brad: We a solution called Kount Control. And it provides account takeover protection, leveraging technologies that we’ve proprietary technologies that we’ve developed. So, it’s an in-house solution, and what it enables a lot of our customers to do is if they have accounts that they’re end consumers or their end-users are leveraging in order to interact with them. We provide them the protection that they need to ensure that the consumer or customer that they’re dealing with is actually the personally think it is. A lot of our customers have apps or require customers to log in whenever we interact with them, and what we enable them to do is say, Okay, this is actually Brad Wiskirchen. This isn’t a fraudster using a synthetic identity to mimic Brad Wiskirchen, get into the accountant that drained the accounts money or points or whatever it is the fraudster may be searching for.
Greg: Okay, great. And I recently saw a Javelin Report that talked about digital innovation, which depending on how things and how quickly things come back online in the business world, how much digital innovation will continue, but certainly we’ve seen a lot of that recently and how that new digital innovation can open up different areas of fraud. Do you have a perspective on that. What do you guys do to help there?
Brad: Yeah, absolutely. We’re seeing a lot of that. In fact, a lot of historically brick and mortar companies have leveraged us over the course of the last year, year and half to protect them as they make digital innovations. For example, quick service restaurants have historically not been engaged with their consumers in the digital environment, you’ve usually gone up and bought your burgers or pizza or your doughnut at the store counter. Well, as they’ve all moved to a digital environment or digital interaction with their end consumers, they’ve identified that there’s a lot more and different types of fraud that they’re having to deal with. So, it’s a direct result of that. We’re now protecting some of the biggest names in the quick service restaurant industry, the Dunkin’s, the Dominoes, the Wendy’s and Burger King’s. People like that and across the border into Canada, Tim Hortons and we’re enabling them to move forward and to interact more efficiently with their end consumers without the risk of fraud. We’re also seeing that in industries like oil and gas, where you’ve historically just got into the pump, plugged in your credit card on the counter and paid for your gas. And now companies are creating gaps so you can pay your app. And they’re experiencing the same sort of experience when it comes to dealing with new vectors of fraud. So, they’ve been able to leverage us in order to ensure that their consumers are able to deal with them and make use of their new digital tools but do so securely.
Greg: Great. As you know, everyone knows the payments industry is very competitive. And I would assume even in the fraud sector of payments, it’s quite competitive. So, what differentiates you guys from your competition out there?
Brad: We’ve been around over a decade and we’ve protected some of the biggest names and biggest brands, the highest transaction volumes and the most sophisticated transactions over that entire period. As a direct result of that we’ve collected, created an enormous amount of data, which helps us to be highly efficient. We’ve been leveraging unsupervised machine learning since the company’s inception and started leveraging supervised machine learning. In addition to the unsupervised machine about a half decade ago. And we’ve been able to take this all this data that we’ve collected and created and the unsupervised machine learning and supervised machine learning and create a solution, which is truly artificial intelligence, meaning it’s for us we take that term very seriously and it’s effectively what Turing did in his test, which is we stand our technology side by side with the best and brightest when it comes to fraud control in-house. It’s our most sophisticated clients, and the machine is doing the is coming up with the same results as the best and brightest fraud experts are, and it’s impossible to tell whether it’s a human or a machine making the decisions. The other things that differentiate is us are just the breath of our solutions. We’re not just a point solution or not, just an email, first scene sort of fraud control solution. We’ve got that built into our technology because we’ve created it ourselves. We’re not just a device fingerprinting solution. We’ve built that technology and ourselves, and it’s part and parcel of our solution. So, whereas a lot of fraud control solutions just do one thing we have actually created a solution that incorporates all of those things into our solution, and we don’t have to reach out to them for data or results. So we’re able to take advantage of all the solutions that we’ve built and all the tools of we’ve built on purpose to work with each other and provide best in-class response times. So its the sheer volume of the data that we’ve got to educate our artificial intelligence. It’s the type of machine learning, artificial intelligence that we leverage. It’s the completeness of our solution that we’re able to not just fight payments fraud, but we were able to fight all the fraud that a customer may experience in its digital interactions with its consumer. And it’s the innovation. We are launching new products and new features at this point on a monthly basis and meaningful and powerful new tools.
Greg: Great, and I assume a great market to be and just I mean, unfortunately, fraud is growing, but it’s a great market to be in, and I know when I ask this next question about the trends in the industry, I often get an answer, “you know, we really have to get better at this.” And I think you guys are right in that space. So maybe talk about where you see the fraud segment of payments headed in the next say, 2 to 3 years.
Brad: You know, there I think there’s going to be a lot of consolidation of the payments industry. I think people are going to start concentrating, a lot more on some big problems that merchants who at the end of the day, everybody’s end consumer or customer. I’ve been facing for a long time, which is optimizing the authorization rates of the transactions that they see. And I think that they’re going to start aggressively going after solving for that. I think there’s still some big opportunities within payments that haven’t been addressed yet. Some of the neo banks and neo players have started to look at a few of them, but there’s still a lot more. I think that some of these neo banks and new players in the processing space will drive the historical juggernauts to be even more innovative and I’m seeing that actually, right now, some of the biggest players are making some huge strides and innovation a lot more aggressively and powerfully than I’d say they were 3, 4, 5 years ago.
Greg: Sure, so I think would be a little remiss if we didn’t talk about sort of what’s going on in the country and world today. So, what is Kount doing to really support your employees and your customers during these challenging times?
Brad: Well fortunately, we’ve had a pandemic plan in place for over a decade. It was one of those things would be created because it was best practices. I remember when we did it I thought we’ll never use this, but fortunately we had it in place, and so when we decided to go work from home. It was a decision that I made about in the afternoon on one day and the next day the entire company was working for home without missing a beat, and we’ve increased the support to our customers. We’ve been proactively reaching out to customers who have obviously been facing challenges and coming up with solutions to help them continue to fight fraud but do so in a way and supports this time where their cash strapped or having a difficult time. So, we’re hyper devoted to providing customer service, the best in class customer service to merchants that we face and working with them on unique solutions, arm in arm and hand in hand. But I think we double down out, of course, of the last month and then as far as our team to keep that motivated. We’ve increased the level of communication that we as an executive team have been providing everyone on the team because people will fill vacuums of information with misinformation, in my estimation. So, my mantra is always been to be open, honest and fearless with the team and the cadence with which I disclose what’s go on with the businesses increases rather materially, and in turn the volume of information I’m sharing with the team members is increased materially over the last month, and I was just trying to work in the environment and had still have fun. So, we’re having Zoom cocktail parties for the various departments tonight. In fact, we’re having a company-wide pizza party with families with everybody in the company, so we’ll have Zoom on and the company’s ordering pizzas for every family in the company. It would be like a company party tonight under the new environment, so we’re doing everything we can to keep people recognizing that this too shall pass. And that honestly, we’re all in it together. We’ll push through it.
Greg: Thanks. I appreciate that answer. I mean, I appreciate you telling everyone what you guys are doing. I think it’s great. I think it’s a common theme. The people getting used to working from home. And then, what can we do to increase communication? What can we do to add a little a bit of fun into these trying times for everybody? So, all that’s great. But Brad, let’s pivot and talk a little bit about you. Let’s talk about your journey, how you became the CEO, there at Kount and what you went through to be at that role.
Brad: Well, I used to be a CEO of a large retailer of digital goods. And we started in 97 and those were a while in woolly days of e-commerce especially in the digital good space and we, as a result of that, had been forced to create our own fraud control technology. And that’s when we invented and patented device fingerprinting. We’re there in the first half of device fingerprinting which is now owned by Kount And I remember having dinner with my Mike Duffy then CEO Chase Paymentech and he said to me, “Hey I don’t know, you guys were in the roughest neighborhoods of e-commerce, which is digital goods. But you have the best fraud rates of any company in our portfolio. How did you do it?” And so, I told him what we were doing. He said “you out to bottle that” and I flew home and sat down my business partner and the founder of that company and said, “hey maybe we out to bottle this.” And so, we’re eating lunch, a sushi restaurant in Boise, Idaho, and on 8 1/2” by 11” sheet of paper or a napkin as Kount refers to it, we and a pencil, we mapped out what it would take to create a fraud control solution. Yeah, we started that and then ultimately I spun it off that original Internet retailer and became a full-time CEO of Kount. So, I’ve been here since Kount was and 8 ½” by 11” sheet of paper.
Greg: That’s great. And, you know, I spent almost 10 years at Chase Paymentech, and you and I actually met, probably like maybe 2008 when Paymentech was white labeling your solution for our customers.
Brad: Yes. Safetech.
Greg: Exactly. I actually came up with the brand name Safetech. So, I think that was what, at least 12 years ago at least. Yeah, I think it was. So anyway, small world. So, tell me something you’re passionate about, whether it’s work related or outside of work or maybe one around work and one around not work.
Brad: Around work. Passion about my team. A lot of people think that’s a trite cliché but it’s not. I love the people that I work with. I spend more time each day with them than I do my wife and two kids, right? And so, it’s important to me to get to know that I get to know their families are. And I’m a firm believer that if you treat your team with respect and if you care about them on a personal level, not just if they crank out code for you, or get the invoices out, that’s meaningful to them. And I know it’s meaningful to me. So, at work that’s what I’m most passionate about – my team and making sure that they have what they need to succeed. I’m a firm believer if you do that, if you take care of people that they will take care of business and take care of you at the end of the day. So maybe I’m a little Pollyannaish but I do believe that. And personally, I’m passionate about my family, my kids. Nothing better than helping my son with his scouts or my daughter with her art and school projects. And I just find no greater satisfaction in life than hanging out with my 13 and 15-year-olds.
Greg: Great, thanks for that answer and as you know, like I said earlier payments spaces is growing. Obviously, times are changing, but hopefully when we’re out of this, I’ll call it a mess for lack of better words. Things will get better. We’ll get back to where we were and a lot of people actually wanting to have a job in the payment space coming out of college, maybe even knowing what the payment space is. And I often hear people saying, they fell into it, as opposed to thinking of it as a career, and even our friend Ralph is teaching, I think a Fintech type of class up in his area of the world, in the Boston area. So, what would your advice be to someone that may be coming right out of college or very early in their career. If they wanted to get into this payment space, what would your advice be to them?
Brad: It’s a pretty small space, and it’s not hard to get to know the players in this space because you know, you think it’s big, but everybody knows everybody else in payments. So, my advice to them is fund the sub-space that you’re most interested in, get involved and then work to get to know other people in the space. But first and foremost, my advice would be once you’re in the door and there’s plenty of opportunities to get in the door because there’s a lot happening. Well, once you’re in the door be absolutely honest and forthright in your dealing and treat people with respect because it is a small space and everybody knows everybody else. And everybody knows who the good folks are in the space, and everybody knows who the buttheads are in our space, and it doesn’t take long for word to spread. So I think if you were a good, honest person who work your tail off, you can go places fast because the positive news spreads as fast as the negative news and as a direct result of that a lot of doors can open up just through doing your best, working hard, being the best prepared person in the room and with each meeting and just being unabashedly honest about everything that you do and you’ll have opportunities to do things you never dreamed of.
Greg: Yeah, I think that’s some great advice. Well Brad, we’re about to wrap up, any final thoughts for the audience today?
Brad: No, I think it’s a pretty challenging time right now, but I think there’s a lot of good things other happening. I think people are concentrating on metrics, which actually matter related to businesses and relating to their employees and refining, improving and enhancing and optimizing processes. I think a lot of good will come of it and there’s a lot of opportunity in payments as a direct result of this and there’s pockets of really great things, we just close out March the day before yesterday and it was our second highest month in the history of the company. And we’re seeing we’ve got some clients who are really struggling, but we’ve got some clients who are really providing enormous value to the end consumers and seeing tremendous growth. So I guess what I’m learning from this whole experience is, if you provide a great solution that works for your customers and you aren’t afraid to do the right thing, no matter what it costs that even through probably one of the worst crises in world history, you can still grow business, your customers will not only continue to go to you but maybe go to you even more than they’ve historically gone to you. So, it’s not all sackcloth and ashes right now. There’s pockets of happiness and opportunity.
Greg: I agree. 100%. Well, Brad, thank you for your time today. I know your time is very valuable, So I really appreciate you being here.
Brad: Well, thank you very much for having me. And thanks for starting this program. It’s a great thing.
Greg: Thank you. I appreciate that. And all you listeners out there thank you for your time as well. And until the next story…