The Insights Interview with Gary Cardone

hi everyone i'm tony craddick i'm the director general of the emerging payments association and this is the monthly insights interview where it's a chance for me to chat to one of the industry's thought-shaping industry-leading opinion-making industry executives who will share some thoughts about them their business and their views on the industry and i'm delighted and excited to be welcoming to you today the uh ceo and co-founder of chargebacks911 and uh gary is a serial international entrepreneur uh he's been involved with gas and power businesses um and now he's in a business that removes the friction from um credit card uh fraud and he is addressing the mounting problem of um disputes in in the fraud industry worth 300 billion dollars so he's a important uh guy and a very big welcome to you gary great to have you here thank you tony good to see you i wish we were in a pub in england somewhere having this conversation but we're doing the best we can so do i so do i so look gary i'm in beautiful tampa right now with with too much heat so apologies for the t-shirt you're in tampa georgia and i'm in downtown london it's lunchtime with you this evening here but who knows we are where we are so great so look gary whenever anybody meets you they they know you're a guy who has drive so what is there in your your past or your present that perhaps has motivated you to be who you are well that's a big one um you know it's funny i've just been reading two or three books and it was talking about really very very successful people and uh one of the common themes seems to be in this century that there's an awful lot of really really really successful people who have you know dynamically changed complete industries many of which in fact at least half like stop going to school formal education um and and i and coupled with that they all their lives seem to have some trauma in their background i mean if you really dig elon musk does not talk about having an awesome childhood and i think it goes on and on and on when you talk about these stories you know my honest answer because people have asked me this before fear guilt and insecurity um and and no one in business ever talks about that they talk about well i want to help the world that's awesome i do want to help the world but i have noticed my whole life whether it was 18 22 28 30 running the company being working for a guy in the company like i would always show up a little bit early and stay a little bit late not because i was this workhorse but because i think that's what my boss would want me to do and i definitely know that's what my dad wanted me to do when i was my dad died when i was really young but my twin brother and i would go out and work in the yard with him and he and i both grant and i are both relatively successful relative to the rest of the planet thank god and we both talk about like being completely confounded when we were eight years old because my father knew how to work he knew how to pick up a rake and use it and like we were so messy i'm watching my kids go through this right now yeah no structure no organization so my answer really is part of it is like i want to be productive member of society um when monica got pregnant she came home one afternoon i was completely unemployed i i i was fortunate enough to help build a business and retired from left england at 42 years old and i was done i was by the way big mistake would never recommend anyone at 70 retire if you're enjoying what you're doing you should keep doing it it was not good for me to unplug intellectually but one i was done with the business i did i just was no longer enjoying it and i have been one i'm not going to chase the money i will not have anything trapped me it's been one of my major goals since i was like 16 not to get trapped in the material universe but but when monica told me she was pregnant i was like one i gave her a big hug i was really excited i was really really really excited yeah the next comment i made was man i gotta go find a job literally i said well i gotta go find a job and she's like wow i'm like we can't have our kids walking around the house crawling around the house seeing their dad and their mom not doing anything like smoke cigars and trade stocks that is not a productive message so some of this is born out of like obligation and and and look god gave me or whatever the universe you believe in i think i you know i have a a a at least one or two minor gifts and not to use those like to me is is is not a good thing yeah brand brilliant i can set an example you know i don't have a harvard education i didn't go to mit i have people that work for me that went to those places which i think is awesome um but i think you know i i have a an obligation to set an example if if for no other reason one person who wasn't fortunate enough to go to a great school and they can go hey that guy that cat actually makes a decent living he worked in four industries and was able to survive without surrendering his own personality which has been important to me so look without a game i get in trouble and i become bored i get in trouble i think you you and i share that a bit in common we need something to do absolutely absolutely that's my answer tony i don't know if that's it no it's a great it's a great answer and and what is clear from your success at chargeback's 9-1-1 that the doing has worked but you've seen a lot of change i imagine since you set it up a few years ago and and i know the audience would be interested to see your observations bearing in mind with the journey you've taken so as to what what changes you've seen in payments um and in our community over the years well i can't remember exactly i'm thinking of a person that i met in london that was from a very large acquiring bank and i moved to london before we moved to london uh in 16 2016 because part of our journey was hey we want to be an international business you're not going to do it from america we're just going to tell all americans if you want to do business in europe grow some cajones and move to europe and don't do the mundi thursday the europeans know it they don't like it they'll happy to suck information from you but they want to see commitment on the ground so we went to london but before that i was i spent a year in london doing research r d uh what military people call reconnaissance and i met a guy that worked at a very large acquiring bank that's probably around your age maybe a little older he's been in acquiring for century and four meetings i had with him and he constantly told me hey no way no one will ever make money from chargebacks it's the dumbest idea in the history of mankind and i was reminded of this idea about you know they call you bad you know when somebody has jesus has a new idea and they want to kill them and and they say no no no and then people come around and go hey actually you know this isn't a bad idea and then a decade later it becomes the norm yeah um i think the payments industry is under so much stress right now that if one were to look i'm an outsider so when you guys hold me responsible for being aggressive and i am an outsider in a very very large uh antiquated with all due respect archaic of industry and that would be true true in my opinion of every 20th century construct so i'm not you know blaming anybody we are where we are because this is how we got here like you know um a lot of people don't use coal anymore okay in western civilizations but there was a time when our countries depended on using gold so so payments is archaic so what are the changes that you're seeing well i'm seeing first the point i was trying to get to i think people are waking up i think we're in the wake up phase unfortunately everybody needs to kind of come to conscious level immediately because we keep acting i mean my experience in the last nine years has been people use excuses for the inefficiencies and payments instead of confronting that there is a massive leakage issue in payments when you have 500 close to 500 billion dollars in declines refunds that every retailer will tell you i am dying from retards and most of them a good 40 of them are fraudulent consumer had no intention on buying yeah and then we bring up the chargeback which is the last big piece which is you know i read a document the other day suggesting there's going to be 400 million chargeback events between america and europe in 2023 400 million that's in addition to the declines just in that little space right i look at that and go if that was bitcoin it would be under department of justice investigation it's broken it's so broken and so i see people starting to wake up the mega mergers have really lit everyone up and then you have the crypto world and you have federal reserves the imf major banking institutions both sovereign and private all moving into the digital world so we are undergoing a tsunami of change i don't think the planet's ever seen and i don't think you can be barclays hsbc you can be alibaba and like i'm sure anyone on any continent uh unless you just built something yesterday you're going to be stressing with all the legacy baggage you're carrying around i mean this new market is designed for speed boats and and navy seal boats like in and out i mean i i saw an interview by clara the other day i thought the guy was brilliant so look we're not taking any money from people that think we can do this in six months you don't change and transform multi-trillion dollar markets in a quarter yeah so i think the private companies are in a real like we're a private company for a reason because it allows me to take tactical strategy decisions and and not worry about what it's doing in my quarter otherwise i would have never gone to london yeah brilliantly but it's a real it's a conundrum right because when you're a public company and you have 22 euro analysts goldman sachs asking you questions and they're asking 32 other people same questions and there's four count four consulting firms on the plan that basically advise all these companies i mean someone asked me one day they said hey how can you move from natural gas to government work to electricity to real estate and then payments and like be successful and like have a modicum of success in all of those i mean the first two were monsters yeah and the answer is i'm at the right place at the right time yeah and i'm good with change but it's a lot easier for me to uh make that change than a big legacy player they have just so much weight to carry around i think many of the people listening to this interview will be delighted to hear that because they are part of the progressive entrepreneurial uh innovative uh payment community that the epa represents and and so when you're sitting there and you're in temper georgia and you're thinking let's let's focus on on the big chances what would you say are the the sort of top three opportunities in in our industry right now that's no that's the third question right yep the top three wow um you know sorry to be difficult but i think it depends on who you are if you're a large private equity current a firm like blackstone kkr advent bain uh et cetera it's a general atlantic uh man the opportunities are like you know there's debt consolidation there's buyouts there's companies are going to get blown up they're going to do restructurings and then they can also look at the fintechs these innovative new companies that don't have legacy and they're solving problems i think many of these fintechs are what i call small trojan horses and they're using an expertise and this is exactly what we have always done we use an expertise to wiggle into the payments system and we become an instrumental part of that system providing a built for purpose solution technology whatever but it's focused on solving a problem and then once you get your feet under you then start solving other problems um for us like i could buy 10 companies tomorrow morning okay now managing all that acquisition is a challenge it's a different business and it would hurt chargebacks 911 because we have so much to like focus on right now but i think it really depends on where you are in the food chain what the opportunities are i think one of the greatest opportunities for big banks and i was hoping you were actually going to say that the big banks would actually like what i'm saying um because the big banks like to me the first thing they have to do is really define hate what is it we do yeah and saying that i'm 300 years old bank is not not what you do like that is not dinosaurs said that once too and then that you know they're no longer here so i think you know really depend if i'm a big bank i'm going to spend 20 of my time on culture and then i'm going to spend probably i'm gonna take my balance sheet and i'm gonna use it in the most aggressive way that i've ever used it before yeah and basically like i've been a little surprised that the card schemes haven't bought more people complain about how much they're buying i think they're gonna buy everything it looks what do you think alibaba is going to do when financial is going to do with its 36 billion dollars well the energy market is far larger than the market we we think that we're such a big big player of it's in the it's in the 20s of trillions and we're in the threes so if if i'm a if i am a western financial institution i have about seven great fears and ant financial is right on the top of that list because i think the future is not about hey barclays is competing with us ubs i think you compete you're going to be competing with ant you're going to be competing with software companies big big monster software companies that could buy any of these companies at a 30 premium with cash and they don't so it's very interesting that that so i think for the software companies microsoft fraud software uh the tax companies like alaba uh alabar uh avalora uh some of the new acquiring banks um and and maybe some of the guys that have done this you know big big mega acquiring piece um look i think this thing is so dynamic this is like being in the middle of a tsunami with you know well in the middle of five earthquakes occurring at one time there are going to be shock waves so so a bit scary hugely exciting lots of opportunity which you've just been talking about so what are the what are the obstacles then that might stop people from realizing those those opportunities one of the things that's going to get in the way and stop them well you say it's scary see i i wonder is it really scary i think initially like i've been through this four times now okay in two countries four times when i'm in an industry and it goes through a major disruption like i'm gonna write a book and it's gonna be really interesting not about what i did it's about like hey i was just happen to be at the right place when some change occurred and i was bright enough to see it go oh wow that's interesting that seems weird well it didn't seem weird when you started okay 30 years ago um i i i think if you look at the opportunities i mean look you asked me a question i didn't fully get payments school and education is going to be majorly disruptive okay school and education is a big deal for me i would love to be you could have a thousand companies disrupting the education system yeah and they all be billion dollar businesses it's that big uh cryptocurrency very few people they get into this fear thing though i don't want to know it you better know it okay because it's coming um oil gas power these industries are changing radically i mean radically right it's not one it's not just finances it's not just credit cards the entire construct that happened before the 20th century is being greatly challenged residential homing how people live places uh ride sharing evs so to me it's really really really exciting right yeah if you're able to stay in front of it and not get crushed i think the great risk you said hey what's the biggest problem it's what i call the glittery object syndrome that everybody's doing this you know and if you don't really know what your core business is like we really know what our core business is we don't go in the gateways and i i could have bought like this is the reason i formed card one ventures we passed on like 27 deals in the last three years because i knew that if i bought that into the company it would mess the company um i farmed card one so i could do m a for cb911 but also when i popped around and saw like we inve we i invested in the new ipo i should have been doing this for a long time um i could invest in the new bay ipo under card one ventures it has nothing to do with chargebacks number one right so it's about it it's about focus focus focus because you have you you just have so much going on by the way i love you being the archetypal american drinking a can of coke it's just absolutely bang on message breakfast champions i'm magical nicole you'll be a royalty now please so so look um i i always say i think you you're very driven a very strong-minded but you're also a big family man um a couple of questions if you don't mind about your family and your family life i want to ask about your kids in a minute you meet these guys back here yeah i know what an amazing good looking family you got so um so first of all um you're married to your business partner she's an extraordinarily she's an extraordinary woman she's a force to be reckoned with um she's a award-winning she's done some great things what's that like being in partnership with both in business and at home what's it like yeah how do you manage it i'm not sure it's it's a challenge i'll tell you look i think you know um i don't actually know the answer to that because it is really really challenging um the business today had we known the business was going to be this big uh like one i'm not a big believer let me just be really on i am not a big believer in family-run businesses and the reason is some people find this really weird that i actually say this because i'm in one by the way for all me and my brother completely separate businesses i invest with him passively nothing to do with his business at all zero he has nothing to do with my business he has not one penny in my business he doesn't tell me what to do he has no vote nothing so just because everybody thinks we're funding each other it's like whatever but because i actually don't think two people can drive the same ship without wrecking it um so i have not seen in 30 years a lot of family-run businesses that are big and i love building big businesses i just don't i think a man old man told me a long time ago dude it's just another zero so if you can do it ten times doing it ten thousand it's just xerox and it's like oh i can i can understand that i'm from louisiana i got it yeah so she is brilliant um the the challenge with the family and uh being a parent and running a a global business like you have to just look at things a little differently um like we travel a lot on private planes and people laugh at us but it's like hey try to live my life without that like i'm very interested in the way i live and who i am i'm not interested in chasing money and having all this stuff stocked up and a bunch of homes we don't have any of that um and what i'm really interested in that our kids can come and go with us um look she's a brilliant person we happen to be also married creates some you know challenges for us uh the biggest problem is that you know when you go home it's hard to turn the work off yeah absolutely especially when because you've been working in uh in florida and and and keeping to uk time so you're up all up really really early and you know and it's other little things like this i mean it's not a little thing uh if we didn't have children it wouldn't have this issue but for instance we have a big business in london if we weren't married i would be living in mayfair and she would be here yeah and i would be running revenue in europe and she would be over here running the operations but yeah very you know we want to make that and so it creates some issues and and it's not perfect but the truth is i've never seen an organization as perfect absolutely and i'll tell you what shell oil hasn't figured it out either you're quite right and i'll tell you what i love is your your business really works and it's great seeing you together so the final the final question i've got for you gary so you you've got a couple of kids how old are they uh 10 and 13. okay so they're just just sort of uh early stage teenagers um uh what what would you say to um anyone considering a career in our industry you know whether it's your daughters or others what would you what would you what would your advice be somebody thinking about a career in payments if i'm 10 or 13 i'm probably not going to tell them what to do because i think any advice i would give a 10 or 13 year old that the speed of change that is occurring on this planet uh the only thing i could probably tell them to do that would be awesome would go into rockets i mean someone asked me recently hey two businesses uh what do you want to go into and my answer was rockets space travel and credit card financial transactions i will never be able to afford going into rockets ever yeah yeah so so that's a that's now a new you know trillionaires game yeah i love it by the way i think it's great for this planet but for anyone that's 22 and above uh 50 years old if you're in payments man i've heard this so many times recently i'm in payments i'm thinking about leaving wrong decision like the payments industry i could be back in there's a lot of stuff i could do this is the most exciting industry other than space travel that i know of that any person can get into you do not need billions of dollars like we'll hire a ton of people here um you don't even need to get paid necessarily what you need to do is get a job everybody worries about i need 200 grand like right now you need a job there's going to be a lot of layoffs in this industry and i think people are really not understanding what's getting ready to happen and this industry is bloated with generals loaded absolutely chock-a-block bloated with people that can't even explain the process of a transaction that's not healthy peter bailey asked me once hey what do you think the biggest problem in the payments industry and fraud is and my answer was i think you have 32 000 people walking around acting like experts pretending to be experts yeah and he agreed sorry i believe but there's too many people that and i'm not an expert yeah like he thinks i am but i'm not not like i might look at things and be able to make build a business from 20 000 feet but monica is an expert tracy craig's an expert andrea nolan expert yeah um peter bailey expert so johann gerber expert now they also have issues right um so so that i think you have 12 years it's probably last time we had lunch if i was 35 years old i think i could build two multi-billion dollar businesses in the next 10 years like it would be so easy to do um so i think it's just about hard work don't raise too much money um don't let debt get you out of control you don't need all that stuff and and and then and you know now for my kids like my kids don't go to formal schools if i have anything to do with they never will go to a formal school and they need to know how to communicate receive information and give information in an articulate manner they need to be able to do general math not trigonometry general math hey what's 10 of 180 000 because that's the interest rate yeah what does compounding mean and uh you know i asked 30 ceos of large companies if i had an 18 year old kid that traveled all around the world with their parent their entrepreneurial parents they could communicate well and they could do general math would they give them an interview 30 out of 30 said yes i did not ask for a job i asked for an interview yeah my kids get an interview they can decide whether they get their job or not right so they'll kind of decide whether they get to keep it or not yeah brilliant gary thank you thank you so much it's great for you to have been so open with us and i know what you like you just that will have been exactly how it is for you so i know that the audience listening into this will have benefited enormously from those little gems those little nuggets of kind of wisdom i suppose but built on a lifetime of experience of being an adventurer and being out there and i admire you and i think you're brilliant and hang in there and keep on setting a good example to the rest of the rest of the industry thank you great to see you keep up the work buddy you're doing awesome thank you thank you the epa has changed it has changed so much like it's it's really cool so awesome job you and your team thanks gary for your time all right ciao

Channel: The Payments Association

Views: 4,469

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Id: ke22-0ku_ak

Length: 28min 30sec (1710 seconds)

Published: Tue Nov 03 2020