Selling a company for US$480 million would be considered a success by anyone’s standards, but some entrepreneurs have such a fire burning inside that they have to continue to get better and build towards greater things. One such entrepreneur is Michael Gastauer, who did that very thing.
Starting with a payment services company in 2003, he sold his business only five years later to Malaysian Banking Group for US$480 million. Six years later he started his next venture, digital banking platform WB21. The FinTech startup overing real time account opening and cross border payments for 180 countries, grow within ten months after launch to over 1 million customers and US$5.2 billion in payments. In September 2016, WB21 reached a US$2.2 billion valuation, which makes this alternative banking platform the fastest-growing FinTech in history.
Being an entrepreneur in your mid thirties and having reached a net worth of half a billion would allow you to settle down and enjoy the nicer things in life. Michael does the opposite, he sees life as a journey where a new opportunity starts when another ends. Money is not his motivation, what drives him is the passion to solve a global problem.
Solving a Global Problem
The problem that Michael¨s digital Bank solves, is huge in retail banking and effects millions of people and businesses trying to open a bank account in other countries or sending money internationally. There are many good reasons why someone needs a local bank account or has to send money to another country. Current reality in retail banking is that cross border payments take several days and typically cost 3-5% in fees for currency conversion and payment processing. If you are trying to avoid these fees by setting up a local account in the country that you regularly send money to, it takes weeks and thousands of dollars in travel expenses to meet your local banker and get an account. Michael^s online solution WB21 cuts down account opening time from weeks to seconds and safes customers thousands of dollars in traveling expenses to get local accounts.
Making it Happen
One of the biggest complaints most entrepreneurs have is not being able to get started. They struggle to raise the money or they don’t know how to sustain enough growth to keep going.
So how did WB21 manage this level of growth?
Michael Gastauer bet big and invested US$22 million of his own money to fund WB21^s growth. He didn’t bring in any third-party funding not to get diluted at an early stage. It meant that he bootstrapped and focused on making revenues. Michael firmly believes that one of the biggest mistakes many StartUp founders make is to focus on getting VC funding rather than keeping their focus on building a healthy business model that is able to generate revenues at an early stage. His example should demonstrate that venture capitalists aren’t the only way forward for new StartUps.
Standing Out from the Crowd
The FinTech industry is like many industries, it’s almost completely saturated with new startups. That leaves entrepreneurs in a position where they’re unable to gain enough visibility. They’re unable to gain enough traction in the market because there are many companies that look alike.
WB21 had a similar problem, but Michael didn’t let this deter him. He came up with a completely new concept in banking. Michael realized that for certain industries it is even harder to open bank accounts than for the average customer. The Bitcoin industry with millions of users was one of those. Michael decided to focus on applying the WB21 solution to the solve the banking problem for the Bitcoin industry first. He partnered with the largest suppliers in the Bitcoin industry to offer them Bank accounts for their business and millions of clients. The WB21 solution allows customers to buy Bitcoins from their preferred suppliers in real time, using the WB21 account to account transfer (ATAP) which is instant and free of charge. WB21 went even further and implemented as first digital bank Bitcoin as a currency that could be converted into any other fiat currency in real time. Having successfully acquired its first 300k customers from this industry, network effects and focus on further industries let to WB21^s early success and created momentum that soon became unstoppable.
So What’s the Key to Building a Billion-Dollar Company?
Reading through stories like this can make many people wonder how it happened and how it can be replicated. It’s possible to build a company like this, but it requires a few key ingredients to make it work, regardless of the industry involved.
The problem your are solving has to be global and big enough and your solution needs to have unlimited scalability. Hitting an arbitrary glass ceiling will only stop your business in its tracks. Your scalable solution has to solve the major pain point in your target market. Your business model needs to be able to produce revenue and aggressive growth.
It’s far from easy and there’s no real blueprint for this. Michael Gastauer came across the WB21 concept through fifteen years of experience. His model is global and some could say his idea was timed right for this market. There was already an appetite for it, particularly since trust in traditional banks has hit historical lows.
Last Word – The Will to Expand
What separates Gastauer from most entrepreneurs is despite being so successful he hasn’t decided to call it quits and go home. Entrepreneurs who love what they do will never retire because they’re indulging in their passions. And that’s not just an inability to call it quits. It’s what drives them forward in the first place.
Gastauer works 100 hours and more per week to grow WB21 into this global banking group he envisions. The best entrepreneurs will do anything it takes to get their ideas started and grown. When you ask him, Michael doesn`t feel stressed or says he has any complaints about the time he spends at work. For him it it pure fun and he truly enjoys what he does.
What do you think is the most important part about becoming a great entrepreneur?