Why we invested in 4Stop: Solving global challenges in Payments & Fintech.
Financial regulations are complex, timely and costly. There are plenty of players around the world addressing local issues regarding Merchant onboarding (Know Your Business / KYB), Know Your Customer (KYC), and fraud prevention. Regulations are growing globally with consumer benefit in mind (e.g. GDPR, Payment Service Directive (PSD2), and Anti-Money Laundering Directive 4&5 (AMLD)). And while some regulations are seemingly harmonized and follow similar patterns, as always, ‘the devil is in the details’. For a global fintech/payment/e-commerce business, getting general implementations right and convenient for your customers is only the first layer; you also have to do so in compliance with local law in each of your geographies and get in front of a constantly evolving regulatory reality. Simple, right? :-)
KYB, KYC, Compliance and Anti-Fraud — one API.
4Stop aggregates hundreds of different data sources and services to enable internationally active clients via one-API (instead of many). Country A requires ‘service X’ and Country B needs ‘datapoint Y’? 4Stop makes this process hassle-free through the combination of their one-API service and best practice knowledge in a multitude of markets. The 4Stop rules-engine helps to create “what-if” scenarios, giving clients insights into the potential business impact of the risk strategy. Businesses are not only combatting fraud in the best manner possible, but are also able to maximize their performance and acceptance rates — driving revenues and improving customer life-time value.
The result? Fintech businesses can actually focus on their core business & capabilities.
Partners of 4Stop are winning
Data and service-providers working with 4Stop benefit from additional business. Even more impressively, this extra revenue is often originated outside of the usual core geography and out of reach for their local sales force. Trusted service providers partner with 4Stop to augment their offering in complex ‘Request for Proposals’ (RFPs).
Why this matters to Ventech
As an investor, we are thrilled to partner with 4Stop in their next stage of growth and are particularly excited about their digitalization of this operational risk process. Their aggregation of data and knowledge increases the value-add of their service with each additional client and data sourcing. The addressed risk process is a part of a company’s business that, for many, is integral to a firm’s ability to exist yet is outside of the core business and outside the area of expertise — thus the opportunity to partner with a true expert like 4Stop enables companies to focus on core business and continue to operate with smoothly managed regulatory risk. For an investor, the 4Stop business model is also interesting: a strong recurring nature of revenues and margins growing with their clients success.
Today, 4Stop’s team and operations are as global as their business model. You can meet the team in Europe (Cologne, London), Central (Costa Rica) and North America (US/Canada). When we began to experience the team around Ingo, Alvaro, Daniel and Nolan, we immediately felt the team’s collective experience the sense of true teamwork that has been honed and refined over a decade of their collaboration.
We believe 4Stop has only just started to realize its great potential and is well on its way to succeeding in turning the burden of compliance into a driver of business operations excellence in the payments industry globally. We are very happy to welcome 4Stop to the Ventech portfolio family and look forward to being part of the next chapter of success.
// Thank you & credit to my colleague Alexandra Sloves in all regards of this piece