Episode Transcript
Charlie W: Hello everyone, welcome to the Be Inspired series. My name is Charlie Walker and I'm the deputy CEO of the London Stock Exchange. I'm absolutely delighted to be here today with Jacyn Heavens, the CEO and founder of Epos Now. Jacyn, it's quite a journey Epos Now has been on. We were talking previously around a bar where the journey sort of started, to what is quite a significant sized business now. Can you just talk a little bit about what that journey has been like for the company?
Jacyn: So look, it's been one hell of a journey. Every one of our customers starts in the same way. They have a dream, they have something they want to really do. All of our merchants, they go through the same kind of journey. They risk everything, they risk their whole lives, right, to start this business. And you've got hundreds of thousands of these entrepreneurs in the UK alone, and millions and millions overseas. It's a journey all of the entrepreneurs go on. If you've never run a business like that, it is extremely hard to do. These customers, they're the HR department, they do the payroll, they order the stock. They do everything themselves. I learnt that firsthand when I had a job and I started one of these businesses, and I was like many of my customers, had a dream to start a bar and you know serve food and do live music. But I was not expecting how difficult it was to start that business, Charlie I'm telling you, it's insanely tough. And that's where we came up with the idea of Epos Now. You know the idea pretty much was to help these customers be able to understand more of their business. So we built a platform. So we're the operating system for the business. We do all their stock control, we do their inventory management. We are the total operating system they need to run their business. And the whole concept really is to help customers get through that knowledge gap and survive and thrive. And you know we've had a great level of success in it, but it's all really built off helping those merchants be successful themselves and really understand their business. And that's what we're most passionate about.
Charlie W: It must be hugely rewarding hearing about some of the stories of those clients and how you've helped them? It's one of the privileges I guess we have at the Stock Exchange of hearing companies and the stories of companies eventually becoming public and sort of going on to the next stage of their journey and having a even a relatively small role in the success of that, of that company.
Jacyn: Yeah. And I'll say look, before we started the business there was an underserved market of these customers that couldn't afford this technology. So before cloud came along, you know it was really, really hard because all the, all of the software that we provide had to be on premise. So you had this massive, underserved market of people that needed more information about their business, they just couldn't afford it. And that's where the concept was really. We came up the concept to, hey, let's just put it on the cloud, right? And customers then could share the cloud, the cloud platform, and you'd reach an audience that you weren't able to reach before.
Charlie W: Yeah.
Jacyn: Now the business kind of morphed over that time, and we're constantly speaking to our customers going look what problems are you facing? And that's what it's all about really, to your point about the rewarding stuff. It's like, how do we solve customers problems using technology? And the by-product of that is yeah we've built a great business, but we can't lose sight of the fact of it's about empowering these merchants. And I'll tell you this, when we surveyed the customers, we found that there was deeper problems. And one of the problems we found that there was these customers can't get access to financial products. And so what we did more recently was we built an embedded finance engine. So if you look at it logically, so if you if you start a business and let's say you started a pizzeria for example, and you started doing loads of pizzas and the business was a roaring trade. That customer will go to a bank and say hey, I'm doing really well. I'm doing X thousand pizzas a month, can you give me a loan? And the bank usually said, look, well, you know we can't really see that. So come back to us nine months after the year end when you've registered your accounts.
Charlie W: You can see it.
Jacyn: Exactly. We can see it in the platform. So what we've been able to do is make lending decisions, give them a bank account at the start, give them a credit card right away and give them a revolving credit facility so they can grow their business. And we've seen people grow 4 or 5 branches. Seeing that off that platform is massively rewarding for the team, and that's what really drives us for that next stage.
Charlie W: And you've managed to achieve all of this without raising external capital, right? A lot of people will be watching this, probably thinking how on earth has that been done?
Jacyn: What I would say about that is this, is because we were very early in the technology we were bringing to merchants. Being first is really, really important. And that was really critical. I think as well as what we were able to do is we were able to find a product that really resonated with our customers quickly and get it in the hands of our customers super quick. And you know, you hear all these horror stories about people raising capital and raising too much too quickly, and then therefore they lose that attention to detail for the customer. I think for us, what it's enabled us to do, is sit really close to the merchants and scale the business.
Charlie W: Jacyn you're in 75,000 locations now. Can you just talk to us about some of the different types of merchants that you assist?
Jacyn: I'd love to. Look we support a real diverse base of merchants. We serve restaurants, we serve takeaways, we serve retailers. We also do service business like gyms or car repair.
Charlie W: And Neil Shah our Head of Technology I think visited one of your sites today. Do you want to just talk a little bit about what they're doing there?
Jacyn: Yeah, I mean, Mercato is an amazing business. It's a collection of entrepreneurs. So I don't know if you've been there?
Charlie W: No I haven't, not myself.
Jacyn: Where you need to go, because it is a collection of businesses. All of the business owners there, they've come up with a concept and it's all under one roof, so it's like 60 businesses. It's like, and you can go in there and you can try a beer from here, some food from there, it's an amazing business. The people that want to run their business, they're trying everything they can. And you know once that becomes successful all off our own platform, you know, they might go on and start their own chain or something. So it's a brilliant, it's a brilliant place to see. And you can see all that innovation coming through.
Charlie W: I'm conscious that your, the company's profile is growing you know exponentially, but there'll be a lot of people that still aren't familiar with the brand, with the company, albeit now hopefully when they go into shops or gyms or restaurants they'll start noticing it a little bit more. How many countries are you now in? You mentioned the number of merchants. Is the UK the majority of the base at the moment? Any plans to go overseas?
Jacyn: What I'll say about this is, is and you know the team works so hard, and it is hard I guess because you've already got a very, very large business. You're over $100 million in revenue last year, and you're in 11 countries, but it's not a B to C business. And so when you're a B to C business, if you're selling that many I don't know, t-shirts right, you'd know about it wouldn't you? And the thing is for your merchants is you're the platform to run their business, so it just has to work for them. So it's a tool for businesses to become more successful. So we started the business in Norwich, like not many people do that. I think that's been really unique. And we scaled it about eight years ago, we scaled the business to the US. So we built a really big business in the US. That business is still growing 60%. You know it equates for 40% of the revenue of the business. So like where we are today, we've gone into Europe and we've more recently gone into Mexico and LatAm. So you know, we've built this business from Norwich, with that dream to help entrepreneurs follow their dreams. So we're feeling very, very excited about how many people we can reach with this.
Charlie W: And do you find that the products need to be tailored for each of those different markets? So sort of common problems that entrepreneurs are facing?
Jacyn: So they do. I mean people have different fiscalisation rules, different tax rules, different nuances, language, you know invoicing. There are definitely differences. But intrinsically it's still the same issue. It's the knowledge gap. So if you think about it, we're just still solving the same problem. You know, when I started that bar restaurant, you know it was shocking how much knowledge you have to have. That problem is still being understood and worked out today. We've come a long way, but we haven't perfected it.
Charlie W: I guess that nicely takes us on to what's next?
Jacyn: We talked about the embedded finance which we've built out. So we found that we had, our whole market was underserved by banks. So this SME customer, too small and to build a really good relationship with the bank. And we found that we could have a rich set of data in order to give lending decisions. We could also give them bankout super quickly within you know, an hour. We could give them credit cards and card issuing. We could do that straight out of the box. So that meant that a whole, a whole market of customers that were previously underserved can gain access to financial grade products, and it was brilliant. But now when we look forward, like something I'm really excited to talk to you about actually, we've been doing it for a couple of years is, we've been leveraging AI technology through our SideKick platform. So if you think about it, why did I start the business or why did we start the business? Because when we started that bar restaurant, we realised we were not equipped for how complex a business of that scale was. So the thing to still fix is the knowledge gap of the entrepreneur, and switch off those reasons to be unsuccessful. The AI technology we have has the ability to combat the knowledge gap, and that's what we've been working for in the last 24 months. We've been looking at reasons why customers aren't successful, and we've been switching them off one by one using AI technology. It could be things simple like someone's buying a barrel of beer at £99, the other customer's buying the barrel of beer at £300 right? But there's no rhyme or reason for it. There are thousands of small, silly things that we can help delete and improve to raise the bar and allow our customers be successful. Now what we've got today is while we've got a business, you know, well over $100 million in revenue, right? We're in ten countries, 75,000 merchant locations. So we've got a base of like $35 billion in transactional value going through that. Now we can understand all of the mistakes and all of the things these people might do, and we can help switch them off with the technology we've got using SideKick. You know we're still laser focussed on solving that problem. The only difference now is we've got the technology to do it. It's so damn exciting.
Charlie W: Wow. So it's almost it's for an entrepreneur it's, it's the ability to almost know what good looks like, because you're getting these nudges of you're doing something different that's probably leading to less good results than somewhere else, someone else in the network?
Jacyn: Absolutely. But it's not just about sharing other data with our customers. So it's about filling in those knowledge gaps, right? Imagine though, you can partner every start-up in that space with the technology that could pass the bar exam? That's what we're doing. And we're making sure more of these people that follow their dreams, they can survive and thrive.
Charlie W: Pivoting a little bit to following the dreams and surviving. The UK has been going through an enormous reform programme at the moment, really with the objective to ensure that great companies can start in the UK, grow in the UK, scale in the UK and then go global from the UK. I'm keen to get an entrepreneur's perspective on it. Do you think the UK is heading in the right direction in that? Are you picking up the right messages? Is there more that we could be doing?
Jacyn: I can see that the group here at the Capital Markets are building really good relationships with businesses, and listening to the business community, that's the key. And I think they have been, and I think you're doing initiatives you know like this, and you're reaching out and building great relationships, and trying to understand what these businesses really need and want from the public market. And I think that has been second to none. You know you're looking at the new PISCES system as well, I mean that sounds like a great opportunity for people to get access to the secondary market. The environment's you know, been brilliant. And I think everyone's been so kind of US focussed. But I think you're seeing that kind of ebb away now and you know more focus on the European, the UK markets, which is exactly kind of the right thing. I think working as a UK business that's growing, our headquarters are in the UK, we've stayed and we've grown in the UK, but we export overseas. Would I have been able to build this business in the US? I don't think so. I think you're doing exactly what you need to be doing.
Charlie W: I think it's great, it's lovely to hear. I think to your point around listening to companies, listening to the actual users of the markets and entrepreneurs and CEOs around and investors around what they want the Capital Markets, what purpose they want the Capital Markets to fulfil has been, is something that we do sort of regularly, and it's been great to see the level of enthusiasm and dialogue for that. I think also from the UK's perspective, it's been really heartening to see how an entire ecosystem is moving to support entrepreneurs and founders and companies so that this, you know the benefits of this growth really can rebound to the country.
Jacyn: I think it's good right. Because if you look at our journey, if you look at our journey together. I mean we've built up good relationships. You guys have invested in us, and we're in Norwich, you're in London. You're coming to see us. You're interested in the business, you're paying attention. I think what's good for people who are watching this series right, is you guys have offered good connections as well. So this is kind of a good place where people meet. I think what you're doing there with putting yourself as an anchor in the kind of centre, I think that's going to really help level up the country. And I think like you say, if more people stay here, more people invest in the UK, that's great for everyone.
Charlie W: We've covered a huge range of topics there. Jacyn thank you so much for taking the time and coming in to speak. It really is, really is appreciated.
Jacyn: Well I appreciate it.
