How Ebanx has helped to solve payment processing for Latin America

Let’s suppose you are an ambitious upstart somewhere in San Francisco and you decide that you don’t just want to sell to people in California or people in the United States, you actually want to branch out to the rest of the world.

And let’s suppose further that, unlike most Americans, you actually realize there’s a market south of the border, in Latin America. What do you do?

Well, having lived in Argentina I know that it’s very tough for people in South America to pay for stuff in the U.S. And that’s the problem that today’s guest is solving.

Alphonse Voigt is the founder of EBANX, the first payment institution focused on global e-commerce merchants.

 

Alphonse Voigt

Alphonse Voigt

EBANX

Alphonse Voigt is a Co-Founder and CEO of EBANX, which is the first payment institution focused on global e-commerce merchants.

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Full Interview Transcript

 

Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious upstart. All right, let’s suppose you are an ambitious upstart somewhere in San Francisco and you decide that you don’t just want to sell to people in California or people in the United States, you actually want to branch out to the rest of the world. And let’s suppose further that, unlike most Americans, you actually realize there’s a market south of the border. You know, in Latin America. And you want to actually sell stuff to them and make money and do business. What do you do?

Well, having lived in Argentina I know that it’s very tough for people in South America for people to actually pay for stuff in the U.S. And that’s what today’s guest is solving, that problem. Alphonse Voigt is the founder of EBANX. He just his headset off so we’ve got a little bit of echo, but that’s okay. We’ll clear it up. EBANX. . . Whoa, we still have that echo. I’m going to keep on talking until the echo gets canceled by Skype.

Alphonse: I can bring up the headsets again. Do you prefer that?

Andrew: Let’s see. You know what? Maybe try lowering the volume on me.

Alphonse: Okay, cool.

Andrew: You took the headset off why? Because you were feeling a little bit weird on camera with earphones in?

Alphonse: No, no. I’m in an open space and maybe it’s cool for the other ebankers around to listen to the interview. But I can go back to the. . .

Andrew: No, I like that. I like that. Somewhere through the introduction I actually saw you nodding and then I saw you take the earphones off so the rest of the office can hear this.

Alphonse: Yes.

Andrew: All right. Well, the person whose voice you’re hearing is Alphonse Voigt. He is the founder of EBANX cross-border payment processor. And as I said, if you’re in San Francisco and want to collect payments from people in Latin America, you would use EBANX. Aliexpress uses them, Airbnb recently signed up to use them, and so many others. Alphonse, it’s good to have you on here.

Alphonse: Hey, thank you very much. It’s a big pleasure joining you guys on your show and let’s move forward. I’m very excited. I’m excited.

Andrew: All right, let’s move forward. I’m hoping if I do a good enough job you might actually take the speakers out of your computer and put them outside your window for the rest of Brazil to hear it. It’s not for your office. . . For me, it’s not enough that only your office hears it. I want the rest of your country to hear it. Are you in Brazil?

Alphonse: Yeah. I’m in Brazil. I’m in a city called Curitiba.

Andrew: Okay.

Alphonse: Which is just below Sao Paulo, which is the biggest center that we have in Brazil. But Curitiba is a beautiful city. Very green city, three million people. Great to live in.

Andrew: Before doing this, you were processing payments for poker sites.

Alphonse: Yes.

Andrew: And then you read a book. What was the book that turned your life around?

Alphonse: Yeah, I had a previous company before that I was not fully satisfied with.

Andrew: Yes.

Alphonse: And then at that time I was processing payments. The company was also successful. But that company, my heart wasn’t in it completely.

Andrew: Why wasn’t your heart in it? We’ll get to the book in a moment. What was it about it that your heart wasn’t into it?

Alphonse: Yeah, it wasn’t. Because I was there, I was working, I founded the company, I was making money, the company was growing. But I felt like something was missing at that time. Something was missing. I was not fully happy and not fully satisfied. And then this book came in. If you don’t mind, I’m just [inaudible 00:03:24]. I started reading. It was Jobs’ story. And I was reading it, and very, very quick. It was not a biography. It was one book that came before that.

Andrew: You’re talking about Walter Isaacson’s book?

Alphonse: Exactly. That one. And at that time I was able to, by the end of the book. . . And Jobs said, “Hey, you’ve got to follow your heart no matter if you’re doing business or whatever. But for your decisions in life, follow your heart.”

Andrew: Okay.

Alphonse: And I was kind of looking for that. That was right in front of me and I said, “All in. I’m all in, in this.”

Andrew: To find something that your heart is fully passionate about. Before we go into how EBANX was what you were really passionate about, what was it about poker that you weren’t excited about? Is it that the U.S. government made it harder for you to business and so you said, “Look, I’m tired of being an outlaw?”

Alphonse: Yeah. It’s very good to play poker. I like playing poker myself, just as an amateur of course. It’s a cool game. It’s definitely a cool game. It’s a mind game. I don’t consider it as gambling because it’s very mental. I’ve been to. . .

Andrew: So then what’s the problem with it? If we’re going to tell the audience that you found lack of excitement in it or lack of meaning in it, tell me what the problem was? Why didn’t you like it?

Alphonse: No problem at all. The thing is, it’s a niche universe. There is a poker site, they’re good, they’re processed well. But it’s just a portion of people that plays poker and I was looking for something much broader. Something that really can turn. . .

Andrew: So it was just too small for you.

Alphonse: Yeah. Too small. It was a niche. . .

Andrew: What about the outlaw nature of it? What about the fact that the U.S. Congress actually hated poker and wanted to find ways to stamp it out? That the U.S. was arresting entrepreneurs in the poker space who happened to land on American soil. What as any of that feeling a little bit burdensome?

Alphonse: No, not for me. I fully disagree. I fully disagree on that. If you go to Silicon Valley, lots of bright entrepreneurs, they go to Vegas in order to play their tournaments. Even in July when the WSOP, which is the World Series of Poker, happens. Lots of people from the Valley jump to Vegas to play some poker. So [inaudible 00:05:48] it’s a little bit odd, you know? In the U.S. you can play in Vegas but you cannot play in California. But that’s U.S. Nothing to do with my decision here.

Andrew: I see. So for you, you just believed in it and you were fine with it. That’s why you were okay running. The company was called AstroPay, right?

Alphonse: Yeah.

Andrew: Okay. And then you read this book and it made you realize that what you were doing was too small-time. You have to pursue something bigger, something you’re more passionate about.

Alphonse: Exactly. And then it was the time for me to go to a broader audience. I would say to the next league, the next level. And then I had the right partners besides me at that time. And we spoke a little bit and then we decided to create EBANX.

Andrew: Okay. And the idea behind EBANX was going to be what?

Alphonse: It was going to be. . . Okay. Brazil is a huge market. At that time, two or three years ago, it was like the sixth largest e-commerce market in the world. And all the companies trying or willing – merchants, I mean – to sell to Brazil were struggling because only a small portion of the Brazilian population has access to international credit cards. There is a gap. There are millions of people who are willing to buy at Alibaba or Aliexpress websites and they simply can’t. So I’m going to fill up this gap and I’m going to help these people to buy. . .

Andrew: Why couldn’t they? I do remember, actually. I was in Argentina. To set up a Skype account was murder. I actually had to ask a friend in the U.S. to set up a Skype account for me and then I would be able to use Skype in Latin America. I’ve seen other entrepreneurs who couldn’t pay their employees in the U.S. or vice versa because they’re so hard. Why did Brazil. . . Let’s focus on the country where you originated. Why did Brazil make it so hard to buy from American companies online?

Alphonse: Yeah. Argentina is even harder. It’s more closed than Brazil itself. For you to remit funds out and in of Argentina, it’s a very, very complicated matter.

Andrew: Is it because they want to be protectionist? Is it because they don’t want their money flowing outside of the country and so they don’t make it easy for their citizens to get credit cards that allow them to buy from Aliexpress?

Alphonse: Yeah, kind of. Argentina has even restrictive policies than Brazil. So even nowadays that we’re operation outside of Brazil in other Latin American countries, Argentina is out of the scope for us unfortunately. It’s a huge market, great entrepreneurs, great people. You’ve been there.

Andrew: Yes.

Alphonse: You know what I’m saying. I love Buenos Aires. I’ve been there several times and I wish Argentina was a better place to do business with.

Andrew: How about even Guatemala? I happen to work at random places. The guy who’s editing this interview happens to be in Guatemala. To send him money is murder. I can actually get money into a drug dealer’s hand in the Tenderloin of San Francisco faster than I could get money to Joe.

Alphonse: Exactly. If you consider Venezuela, which is also a great and big country in Latin America, we’re talking about more than 40 million people, which has the same problem as Argentina. It’s a pity that countries like that still have this kind of mentality.

Andrew: All right. So this is the problem that you saw. Many people will actually complain over this over yerba mate or coffee or scotch or something. You said, “I’m going to do something here. I think I can make it work.” And one of the reasons why you were able to make it work faster than others was because AstroPay gave you insight into the financial markets. With AstroPay you actually had to get a bank account, and at first the banks said no. What did you say to them that got them to say yes so that with AstroPay you were able to collect payments?

Alphonse: Yeah, the thing is, at the time I founded Astro with my other partners, we were very smart in order to build a good business model for Brazil. In order to collect funds in Brazil and to remit them abroad to pay international merchants.

Andrew: Okay.

Alphonse: So that was a smart move of ours. And then I decided to create my other company, which is the company I . . .

Andrew: But why? How were you able to do it? How were you able to get. . .

Alphonse: Yeah. We’re entrepreneurs. And you interview lots of entrepreneurs on a daily basis. . .

Andrew: But I can’t have my audience of entrepreneurs hear the reason you were able to get it done is because you’re an entrepreneur. It’s not like you could walk into a bank and say, “Hey, I know you have rules. I’m an entrepreneur. Now open up. Smile.” No, you’ve got to do something. Tell me what you did.

Alphonse: Yeah, not only that because [inaudible 00:10:37] able to search for the right laws and to search for the right partners. And we’re able to receive many no’s in our face, “No, it’s not possible. It’s not possible” until we find the right partner that. . .

Andrew: Who was the partner that opened up the door?

Alphonse: It was a bank called BAXS bank.

Andrew: Okay.

Alphonse: Which is the bank that we’re still partners until now.

Andrew: Okay.

Alphonse: And we’re able to do that, and we were able to offer that to our merchants at that time. And we’re able to make it work. And then. . .

Andrew: Is it B-A-X?

Alphonse: B-A-X-S.

Andrew: B-A-X-S Bank is who you partnered up with?

Alphonse: Bank of Exchange Solutions.

Andrew: I see. And how did you get them to partner up with you?

Alphonse: Just tried to find the right solution, the right regulation from Central Bank of Brazil to make it operate. And then we make it operate and then it was all right.

Andrew: Okay. So you had a partnership with them. What else allowed you to get that account opened up in the beginning, back when you were at AstroPay?

Alphonse: What else? Just a solid and strong business model.

Andrew: What was the business model back then? Because you did tell our producer that having a business model helped convince the banks to let you process money.

Alphonse: Yeah, it was like trying to create something new in a restricted environment like Brazil. If you go to a normal commercial big bank, first they will say to you, “This is not possible.” Because they’re not open to new possibilities.

Andrew: Yes.

Alphonse: So that was the main idea. We find the right niche, we find the right partner, and we have the right pitch to attack it. So that’s why we’re able to make it grow.

Andrew: Okay. All right. And so now with EBANX you were able to partner up again with the same banks?

Alphonse: Yes.

Andrew: All right. How much of EBANX does BAXS own?

Alphonse: No. We don’t have any cross-ownership.

Andrew: Nothing.

Alphonse: Nothing.

Andrew: Okay.

Alphonse: We have a great relationship. We process a lot through them today. Nowadays we have one of the largest merchants working with us. So that’s been a very great partnership that we. . .

Andrew: So you just went right back to the same partners and you said, “Look, I’ve got a new business. This time, instead of processing payments for the poker business, I want to process payments for any company out there that wants to do business in Latin America.”

Alphonse: Exactly.

Andrew: Okay.

Alphonse: So my pitch is pretty simple. I go to a U.S. merchant and say, “Hey, are you selling to Brazil?” And the guy says yes. “How are you selling to Brazil?” “Just through my international acquiring, through international credit cards.” I say, “Okay, cool. I can double your sales right away to Brazilians if you start offering local payment methods.” And that’s what they do. We get integrated, we sign a merchant agreement, and then the guy jumps from 100,000 up to 200,000 right away, at the very moment he starts offering local payment methods for Brazilians to pay. And everybody gets happy.

Andrew: You went right away to Alibaba, to Amazon, to big name guys. And you tried to persuade them to use you for local payments. These are big companies. Alibaba, Amazon, they’re run by people who are so creative. Just like you can walk into a bank and say, “I’m an entrepreneur” they can walk into a bank. . . They don’t even have to walk into a bank. They can send an army of people into a bank and say, “Hey, we are Alibaba” or, “We are Amazon.” Why couldn’t they do what you did? Why do they need you?

Alphonse: Yeah, because I think processing local payment methods is not their main focus. So they need someone [inaudible 00:14:46] and experienced to do that for them. That happens. . .

Andrew: What can you do that they can’t? What am I missing? I feel like someone in the audience is listening. . .

Alphonse: It’s not their focus. For example, Alibaba, they want to sell more. They’re not worried about how they’re going to do it, to sell more. Their pure focus is to put products from China into Brazil, into everywhere in the world. Guys like. . .

Andrew: They don’t care about payment. But Amazon cares about payments. Alibaba certainly does through Aliexpress, through their ownership of that, right? They care about payments. What is it about you? Is it that Brazil does not want to do business with foreign companies on that level because they’re reluctantly allowing their money to leave the country but they’re not going to allow their money to leave the country if a U.S. processor or a Chinese processor handles it? Do you have a leg up because you’re local?

Alphonse: Let’s think this way, Andrew.

Andrew: Okay.

Alphonse: You’ve got credit cards. You can buy anyone from Brazil using your credit card. So it means that the government of course allows you to buy abroad. Instead they will shut the credit card channel down. But what we were able to do, we said, “Let’s socialize the whole thing. If I don’t have a credit card and I still want to be able to buy from abroad, I’ve got to be able to do that.” That’s what we are able to do, to make it happen.

So we’re able to connect a very poor guy from Brazil willing to buy from China or from wherever. I don’t have a credit card but I still want to buy. I’m still a global citizen. I’m still a Brazilian and I have money in my pocket. And I want to pay, and I want to buy this phone. So that’s what we made. That was what we were happy to do. We create a bridge between the Brazilians and the most important websites all around the world. And now everybody, even someone that doesn’t have a bank account or doesn’t have a credit card, or even doesn’t have a clue what a credit card is, he’s able to buy from abroad through EBANX’s bridge.

Andrew: Okay. Your first company happened to be a Brazilian company, Ankama.

Alphonse: Ankama.

Andrew: Ankama.

Alphonse: Yeah. Ankama, it’s a French company.

Andrew: Okay.

Alphonse: It’s a French company, and they have a very popular game that Brazilian teenagers like to play in Brazil. It’s called DOFUS. It’s like an RPG game.

Andrew: Okay.

Alphonse: They became our first merchant. They had some problems. They were in France, they had Brazilian users. The Brazilian users were playing those games, paying with their dads’ credit cards. And some of them didn’t have credit cards and still wanted to play the game. So that’s why we got connected with Ankama. Ankama, we’re very, very happy to have them as our first merchant.

Andrew: Okay. You signed them up as the first one. Which one did you get first, did you get Alibaba or Amazon?

Alphonse: No, Amazon actually, they don’t process with EBANX still.

Andrew: Oh, I see. You went right away to Amazon and Alibaba. Amazon didn’t, Alibaba did.

Alphonse: Yeah. Alibaba, through their B2C website that they sell to Brazil call it Aliexpress. They’ve processed with us for more than two years.

Andrew: And Aliexpress is actually I don’t think owned by Alibaba.

Alphonse: Yeah.

Andrew: They were forced to be spun off, but they’re the main processor on Alibaba. Kind of like PayPal is the main processor on eBay.

Alphonse: Exactly.

Andrew: Even though PayPal was spun off.

Alphonse: PayPal is the Aliexpress, sort of, of eBay. And Alibaba, yeah, Aliexpress is owned by the Alibaba group.

Andrew: It is owned by them?

Alphonse: Yeah, yeah. It’s owned. Yeah.

Andrew: I thought they were forced to be spun off. I guess maybe I don’t understand the affiliation.

Alphonse: It’s kind of a spin off but they are owned by the same groups, too.

Andrew: I see. All right. Well, I won’t get too deep into what it is, because I want to. . . I always thought they were spun off, but maybe not. Maybe they’re still part of Alibaba Group Holdings Unlimited.

Alphonse: Yeah Alibaba group is the big group that has many, many companies below it. One is Aliexpress, which is the largest B2C of them. They also have another company called Taobao, which is a marketplace for China. And some other big companies.

Andrew: Okay. So you get them up and running. How long does it take you from idea to finally start to collect payment from your first customer?

Alphonse: It took me. . . Yeah, Ebates was really easy to get started. We already had experience in payments. But I think that this [inaudible 00:19:56] that, how long a big merchant takes to get plugged to Ebates?

Andrew: Okay.

Alphonse: And this is a tricky question, because sometimes you approach a merchant or he approaches us and then we agree on the terms of contract and pricing. And then integration takes place. And this can be tricky, especially because of big Valley companies. They have priorities in terms of, they have limited resources in terms of IT people. And those guys might have other priorities around the world in order to integrate one company or another or another. So sometimes you’ve got to wait in a queue until your time shows up. And then you’ve got to be ready to integrate. So the integration process can take from one month sometimes up to six months. It depends on the merchant’s priorities.

Andrew: You told our producer Alibaba took 13 months to close and go live. After they knocked on your door and asked for a solution, you guys started working on it and then they started to back out. They said, “You know what? Brazil isn’t a priority for us.” And you had to keep going after them to prove to them that you guys should be doing business together. What did you say to prove to them that you guys should be doing business together?

Alphonse: Yeah, this happens a lot. Because sometimes Brazil is a priority and sometimes Brazil is not a priority anymore. At those big companies they change their priorities a lot. Sometimes Europe is booming more and they must allocate the resources to Germany for instance. But the important take away here is that you’ve got to be ready, in front of the door for when the door opens. You are there with your knowledge, with your experience. And something that we do a lot, we’re very transparent. So we are also known in Brazil a lot. We have knowledge on the field. So even on a friendly basis we exchange lots of that information about Brazil, about its problems, about its goodness. So we become friends with people from all over the world.

So when Brazil comes up again to the table, they say, “Hey, I know that guy Alphonse from Brazil. He has a serious business.” And so we are the first one when the doors open. So that’s the important thing.

Andrew: All right. Let me do a quick sponsorship message. And I’ll say it this way. Imagine you, the person who’s in my audience, listening to this interview and saying, “Hey you know what? I could do a better interview than Andrew. What the hell is Andrew even doing here? I could do much better than Andrew.” Well frankly, I think maybe you could. Especially today. Here’s what I suggest you do. Go to HostGator.com/Mixergy. There with one-click install you can install WordPress, the same platform that I use here for Mixergy. You can get a theme for free online, or frankly, as part of being a WordPress user on HostGator. And all you have to do is just start running that, and for a few bucks a month you have a copy of Mixergy with your own skin, your own theme. And you’re ready to go and start doing interviews and publish them on your site. It’s not that hard. And you can see here from the kinds of questions that I’m asking, you could probably do better.

Alphonse, I’m not sure I’m doing such a good job here. I’ll be honest with you. But we’ll get back to that in a moment. I should promote my sponsor. If you go to HostGator.com/Mixergy, they’ll even give you 30% off. So for 30% less than other people who are on HostGator you could be copying my site, doing your own set of interviews, finding your focus and building up your company. This time next year you could have a set of interviews on your site. You could have HostGator as a sponsor probably, and you could build your business.

But frankly, even if it’s not copying Mixergy, even if you have your own idea, don’t let it sit there in your Evernote. Don’t let it sit there on a piece of paper. Don’t let it sit there in your head. Get a website right now. Just put it together in a couple of hours. Just play with it on your own, and when you’re ready launch it to the world and start the business. Do not hold back. HostGator.com/Mixergy. Unlimited bandwidth, dependable service, a phone number you can call up for tech support. I don’t know anyone else who does it. Go to HostGator.com/Mixergy and get that 30% discount. Get started right now and send me a link to what you’ve created. I’d like to see it. Especially if it’s a better version of what I’ve done here at Mixergy.

Alphonse, here’s why I said in the sponsorship message that I don’t feel like I’m doing a good job. I feel like I’m getting your bullet points. I’m not getting what it is that allowed you to overcome all kinds of obstacles. Why you? What did you do that we can learn from and we could use ourselves? You’re in the finance space, in the tech space. One of my friends is Bryan Johnson, the guy who founded Braintree. He says if he listens to an interview he wants to get actionable steps from it. He wants to get insights that he can use. I don’t feel he’s going to get insights from this that he could use. Give me something that someone like Bryan Johnson, that someone like. . . Whoever happens to be listening to me right now can use.

Alphonse: Okay, let me think this way.

Andrew: Yes, hit me.

Alphonse: Have you heard about Jack Ma’s book?

Andrew: Jack Ma’s book? No, how do I not know that he has a book out. But I do know Jack Ma. From Alibaba.

Alphonse: Yeah, from Alibaba. Alibaba’s founder. Because EBANX, we are in an ocean surrounded by big whales and big sharks.

Andrew: Yes.

Alphonse: A financial system, credit cards all around. Credit card companies, [inaudible 00:25:42], big PSP, payment service providers willing to do what we do from a country like Brazil. Tough country, big country, 200 million, bumping economy. Nowadays we’re the fourth largest e-commerce market in the world. Ten percent of this, even more, fifteen percent of the Brazilian e-commerce is cross-border. And so why EBANX? Why [inaudible 00:26:06] in this crazy dream of bringing. . . So why do they choose us? Because we have knowledge. So if I go back to what I’m talking about, Jack Ma, he says it’s not a book, it’s a movie. He’s says, “I prefer being a crocodile in the Yangtze River,” which is in China. A famous river in China, “than another fish in the ocean.

So we know Brazil. We know a lot of Brazil. We do better than anyone because I had more than 25 years of Brazilian experience doing business in Brazil. So we know it. It’s a very restricted market and we know how to operate. That’s why we’re able to fulfill and to serve big merchants from all over the world. And other companies even bigger than us, they are not.

Andrew: You’re saying you know the market more than others. I see Jack Ma’s book. It’s an authorized biography by his assistant, Chen Wei.

Alphonse: Mm-hmm. And then there is the movie.

Andrew: Then there’s a movie.

Alphonse: Then there’s the movie.

Andrew: Actually, is Chen Wei the assistant or is he the person who authorized the biography? I can’t tell. Either way, here’s what I’m seeing from the feedback on Amazon. It’s too literal of a translation of the Chinese version. But is the book that you read, the Jack Ma. . .

Alphonse: No, I saw the movie. Sorry.

Andrew: The movie. Oh, I see. What’s the movie?

Alphonse: The movie is “Crocodile in the Yangtze.” Let me write you.

Andrew: I got it. “Crocodile in the. . .”

Alphonse: Yeah. Pretty cool.

Andrew: Let me see. I’ll just do “Jack Ma Crocodile.” Oh “In the Yangtze.” There it is. There’s a whole website for it.

Alphonse: Yeah, you can buy it on Vimeo. And you can take a look. It’s pretty cool.

Andrew: It’s CrocodileInTheYangtze.com.

Alphonse: Exactly.

Andrew: For five bucks in can rent it, for ten bucks I can own it.

Alphonse: Exactly.

Andrew: All right. Let me bookmark it. I’ll do it after this interview. Can I pay for it using EBANX?

Alphonse: No. No, unfortunately Vimeo is not a merchant of ours. Maybe it will be very soon. Our strategy is to become much more dominant in Silicon Valley as well.

Andrew: So all the startups who are listening to us who say, “I think I want to start charging and collecting revenue from people outside the U.S. Let’s look at Brazil, let’s look at other markets.” You want them to call you.

Alphonse: Exactly. Right away. Go to our website www.ebanx.com and that’s it.

Andrew: All right. What about other countries? What’s the first country you spread to outside of Brazil?

Alphonse: We started our expansion program, because. . . One thing is very important for you. This might be the best take away in the session, in this interview.

Andrew: Okay.

Alphonse: When someone comes to you and they say, “I know everything about Latin America. Everything. Latin America? I know everything about Latin America.”

Andrew: Okay.

Alphonse: The guy’s a liar. The guy’s a liar, because nobody understands the overall Latin America. Because Latin America, there is a big division. One thing is Spanish speaking countries, countries like Mexico, Chile, Argentina, Colombia, Peru, Venezuela. Another completely different thing is Brazil. Brazil is like an island in this South Hemisphere.

Andrew: Yes.

Alphonse: And it’s very hard to combine both knowledge, you know? So we know a lot about Brazil but we don’t know a lot about other countries. And how we’re doing that, we’re hiring the best people in those countries to work for EBANX right now. So that’s how we’re expanding to these other countries. Local knowledge, it’s very, very important. So we have Mexican people working for us and we have an Uruguayan girl which is our expansion manager. Her name is Juliana. Lovely girl. And she knew other countries in Latin America very well. So we’re able to have four new EBANX’s, one in Mexico, another in Colombia, another in Peru, and another in Chile. So we are able right now to collect payments in also those four other countries in Latin America.

Andrew: You’re very entrepreneurial.

Alphonse: Thanks.

Andrew: I’ve got in my notes here that at age 18 you decided you wanted to have money so you can surf, so you can skydive, so you can do things like that. And so you decided you were going to do a rock concert.

Alphonse: Yeah. That was the beginning of my entrepreneurial career. Very early stage. I was 18 years old. I would like to go surfing in Hawaii. I was a surfer but just in my state here in Brazil. I was willing to jump more and they didn’t have cash. My dad didn’t have money to pay. So I’ve got to start doing something in order to create money, in order to fulfill my dreams. And that’s how I started. And I started promoting rock concerts in my city. At the age I was 20, 19 years old. I was in my law school. So it was a pretty cool time. All of us inviting bands to play in Curitiba, selling tickets, making money.

Andrew: How did you sell tickets to the rock concerts?

Alphonse: Yeah, just get in touch with the right concert hall. You rent the concert hall, you rent the equipment, and then you try to buy some radio advertising, try to find some sponsorships. And then you have a rock concert.

Andrew: What was your most effective resource of traffic? Excuse me, of customers, of tickets. Ticket sales.

Alphonse: At that time I was a surfer myself. So I knew the surfing environment, you know? And I was into surf music, hardcore music, rock. So I was able to bring guys like Bad Religion, [inaudible 00:32:03] to play in Curitiba which was pretty cool at that time, back in ’90.

Andrew: How did you get the audience to pay for tickets for it?

Alphonse: Yeah, people listened to that kind of music. And they were rushing to see Bad Religion, for example, playing in Curitiba at that time.

Andrew: I see. Because they’re such fervent fans of the bands they found you.

Alphonse: Exactly.

Andrew: Did you see “Supermensch”? The documentary “Supermensch?”

Alphonse: No.

Andrew: Oh, it’s so good. It’s about Shep Gordon, how he became a manager for guys like Alice Cooper, for Emeril Lagasse. Anyway, when Alice Cooper was starting out, he needed to get an audience. And so one of the things that Shep Gordon did was he took a picture of Alice Cooper, who was wearing nothing but a snake, he put it on a truck and he had it break down in Piccadilly Circus in London. The thing broke down. He had photographers and other media come in to take pictures of this naked guy with a snake all over him in the middle of this public square. The reporters wrote about it. He says the very next day this stadium that barely sold any tickets suddenly sold out. Did you do anything like that?

Alphonse: Yeah, let me remember. Yeah I used to do any crazy stuff to try to bring attention. One time I went to the largest high school in Brazil and of course my audience was there. Five thousand people study in that high school. Most of my audience were there. So I went there. They used to leave at noon. So 11 a.m. I was there. I brought a band with me and we mount in front of the high school sound speakers. Everything at the time, people went out of the school, this rock band was there playing live music to them. Something which was never done before.

And then people freaked out and then they knew about those sort of things that were trying to promote the shows. Yeah, but that was a long time ago. Twenty years ago. But it was very important because it was the very beginning of my entrepreneurial career. And right away, one more factor, the show was in Hawaii. Imagine . . .

Andrew: How did you end up in Hawaii?

Alphonse: South Brazil, there’s more waves like this. And then I was in Hawaii watching thirty, twenty foot sized waves in Pipeline, Hawaii.

Andrew: Ah, because you were a surfer, once the concert was over you treated yourself to a trip to Hawaii?

Alphonse: Exactly, exactly.

Andrew: I see. How old were you when you made your first million dollars? Nobody’s listening to us in the office, so you can tell me openly. How old were you? Were you 30?

Alphonse: No. I was a bit older.

Andrew: A little older.

Alphonse: A little big older. Yeah. I’m 41 now.

Andrew: This was with AstroPay.

Alphonse: Yeah, kind of. Kind of. AstroPay was the first major deal. And then I had an important role in my life, which was an accident that I had. That was the most. . . I can call it the best thing, a good experience. Something very hard to happen.

Andrew: What was the accident?

Alphonse: Yeah, an accident. A skydiving accident.

Andrew: Wow.

Alphonse: Back in 2005.

Andrew: What happened to you in the skydiving accident?

Alphonse: I was a professional skydiver as well. I had, like, a thousand jumps on my back.

Andrew: Okay.

Alphonse: And I was going to do just a very simple jump. Just a normal jump. Whoever has a thousand jumps has passed into many situations. And this was a very, very simple jump. And I said, “I’m going to jump and then I’m going to the beach to relax. And I’m missing jumping.” It seems like two or three months without jumping. So it’s a lot for someone who jumps a lot.

Andrew: By the way, sorry Alphonse, just watch the mica against your collar. It’s making noise.

Alphonse: Okay. And then I went to make a very simple jump and then I had a crash. I got distracted. And from one minute away some, like, a click. And then I was distracted at the time I was about to land my parachute and I crashed. I crashed very hard. And I broke my spine.

Andrew: Oh wow.

Alphonse: So I broke my spine.

Andrew: Why was that a good accident?

Alphonse: It was a good lesson because it makes me think a lot. I learned how to be more patient at that time. It has been years ago. So everything happens in life for a reason. And I think I became a much better person since then. So I learned to have patience. It helped me a lot as well, actually. It took me a year to walk again.

Andrew: And so you were in bed doing what that allowed you to become a better person?

Alphonse: Just thinking. At that time I had just one goal. I learned how to be much more focused at that time. Because I just had one simple goal, which was walk again. Nothing. . .

Andrew: I see. And before that, how many goals did you have?

Alphonse: Many. Many.

Andrew: Like?

Alphonse: That’s the trick part. Like, I was a lawyer myself. I was trying to do international business. I was trying to bring international companies to do well in Brazil. I was not involved with payments still. I had a TV show about soccer. I have a small TV producer. So I was trying to do so many things at the same time. And the accident kind of helped me with two very important things. Focus and patience. I was 30 years old at that time. That’s important. So that’s how I became a successful entrepreneur from that. And also let’s take one project to another, just one by one. Just try to do very well on what you are doing. And this is kind of what happened since I left AstroPay and I founded EBANX. I’m fully committed to EBANX. EBANX is now the leader in cross-border marketing in Brazil because of that. Hundred percent focus, working a lot. And also doing good stuff, everybody’s happy to be working here. Maybe we can . . .

Andrew: Yeah, let’s take a look. Do you want to spin your computer around so we can see the rest of the office?

Alphonse: Yeah, cool. That would be cool.

Andrew: Let’s see it.

Alphonse: Yeah, let’s see it. So take a look here. It’s a new office. It’s a pretty cool new office.

Andrew: Yeah.

Alphonse: That way, guys working. It’s 1,200 square meters. It’s a pretty cool office. We’re very proud of this. Look at that window. We’re short on the cable here. So you can see downstairs.

Andrew: Oh, yeah. That’s yours also downstairs?

Alphonse: Yeah. Yeah, everything is ours here. It’s pretty cool. We just moved in here. It’s an awesome office. We’re pretty happy to be here.

Andrew: And it’s almost 7:00 your time.

Alphonse: 7:00 my time. I have people. . . And that’s the good thing about EBANX and being an ebanker. We speak Portuguese in Brazil and we’re able to give English classes for everyone that works here. We’re 100 people now.

Andrew: Oh, wow.

Alphonse: We call them ebankers. Everybody’s happy to work here. We just deal with international merchants. We don’t do local payments in Brazil, just international. So it’s a pretty cool environment. Everybody’s speaking English. English classes every day. It’s a good culture.

Andrew: Yeah, I see a list of all your clients on your website. Here are some that we would recognize. Facebook, Sony, Wish, Playstation, Aliexpress we talked about. And then you have over a hundred others on your site. What kind of profits did you guys do in 2014?

Alphonse: 2014 we’re about. . . Let me see. [inaudible 00:40:30]. Five hundred. About five million U.S. dollars.

Andrew: Profit? Not sales?

Alphonse: Yeah. No. The sales was much more. The sales was much more.

Andrew: How did we even. . . Let me see how we even found you. Because you and I aren’t connected. We haven’t had dinner or friends in common as far as I know. Here’s what I see. Oh, Alex Dantas. That guy introduces me to the best people. How do you know Alex Dantas?

Alphonse: Yeah, I got connected to Alex Dantas through a lady that works for us. Have you heard about Endeavor Network?

Andrew: Yeah, you know what? Only through you, frankly. And when I did a search to see, did you ever connect with Aliexpress, I wanted to confirm, I saw that they sent out a press release. What is it with this network? Who is Endeavor? It’s Endeavor.org. Who are these people?

Alphonse: That’s the coolest network in the world, at least for us. You might not know because they don’t work in the U.S. Even if the founders of Endeavor, they are Americans. Guys like Steve Bronfman, I guess. He was co-founder of Warner music.

Andrew: He bought Warner Music. Steve Bronfman’s father, his family was the Seagram’s people.

Alphonse: Exactly.

Andrew: He gave up a large chunk of Seagram’s to go by Warner Brothers.

Alphonse: Exactly.

Andrew: And then. . . Anyway. All kinds of stuff happened there.

Alphonse: Yeah, this guy was one of our mentors.

Andrew: Okay.

Alphonse: And this guy, with another girl that you should interview. Her name is Linda Evangelista.

Andrew: Okay.

Alphonse: Rottenberg. Sorry. Linda Rottenberg. And they co-founded Endeavor. Okay, so what Endeavor does? Endeavor goes to countries like Brazil, countries Argentina, countries like Greece, with huge potential of growth but with a lack of entrepreneur spirit.

Andrew: Okay.

Alphonse: And also they go there, and of course they’re huge guys in the U.S. So they contact the wealthiest guys in Brazil for example and say, “Hey guys, we’ve got to help the entrepreneurs in Brazil. I don’t want your money. I just want your time.”

Andrew: I see.

Alphonse: “I just want your time to help guys like Alphonse to grow faster.” You know? So this network. . . And this is growing a lot. And EBANX became. . . You’ve got to be. . . It’s a very hard selection process that you’ve got to pass in order to be approved as an Endeavor entrepreneur or as an Endeavor company. It’s a very hard selection process. Imagine myself trying to sell my dream to a guy like Edgar Bronfman, you know? A tough guy like him.

Andrew: Yeah. Edgar Bronfman, he’s the guy who bought it. And he’s really hard to reach. He’s been rich his whole life. His family has been incredibly successful their whole lives. I see. So you’re saying because of Endeavor you’re able to reach him. Look who else is in the network? Reid Hoffman, the founder of LinkedIn.

Alphonse: Yeah. He’s also part. I’ve also had the opportunity to meet with Virgin’s founder, which is a great guy.

Andrew: Richard Branson?

Alphonse: Richard Branson. Yeah. Every year at New York they have the Endeavor gala party. And some guy showed up. I was there two years ago. And the good thing about Endeavor, only 60 companies in Brazil are considered Endeavor companies. Only 60. Six zero.

Andrew: Did you just wink at somebody else in your office?

Alphonse: Hmm?

Andrew: You just winked at somebody in the office, right?

Alphonse: Yeah.

Andrew: That’s like a. . . Like, someone was leaving. That’s a very cool South American thing. We don’t wink at somebody in the office unless we want HR to come and knock on the door.

Alphonse: Yeah, South Americans, they are very passionate. It’s a great. . . Great people here. You’re invited, by the way, to come here.

Andrew: I would like it. So wait, here’s the person who doesn’t fit. I can see Edgar Bronfman, Reid Hoffman, Alphonse Voigt and then Alex Dantas. How does Alex Dantas fit into all this?

Alphonse: Because of Endeavor, I don’t know much about Alex. But one girl that works for us, her name is Carolina Pascowitch.

Andrew: Yes.

Alphonse: Lily, her nickname. And she worked for Endeavor a lot, for a couple years. For two or three years. And then she said, “I’m leaving Endeavor and I’m going to now live in San Francisco.” And right away Lily went to work for us. And she said, “Okay, I want to do it.” And she’s now living in San Francisco. We’re opening up our office in San Francisco in two months, maybe one month. And so she’s there. So she connected with Alex and then Alex called me, “Hey, you want to go for an interview with Andrew?” I said, “Right away. Right now.” And here we are.

Andrew: Alex is amazing, that guy.

Alphonse: Yes.

Andrew: He’s like the one man welcoming committee. He jumps and gets to know you quickly and he helps me out. I’m really lucky to have him in the network. I had no idea what his connection was to you, but now I see. Endeavor.org.

Alphonse: Yeah. You should try to know more about Endeavor. That’s a huge, huge. . .

Andrew: Yeah, I’m kind of embarrassed that I didn’t, frankly.

Alphonse: They’re not very well known in the U.S. because they don’t support U.S. companies. Even being a U.S. entity, they don’t support U.S. companies. Because the entrepreneurship in U.S. is very strong. So you don’t need those kind of. . . But in Brazil, imagine. I’m a [inaudible 00:46:25] company, starting a business, willing to be closer to the bankers or something like that. And they will connect me with the president of Santander Bank in Brazil.

Andrew: Ooh, I see.

Alphonse: And the guy says, “Hey Alphonse, comme ça?” And shows up and then he spends the whole Friday with you for free. “What about EBANX?” Just trying to help you from his heart. “You’ve got a great business. Why don’t you go this way? Why don’t you go that way?” So this kind of mentorship, you simply cannot buy it. Or another mentorship that I had. . .

Andrew: I see it. And I see that also they’ve got a presence in Egypt, in Spain, Turkey, Saudi Arabia. Interesting. All right. I hope that. . .

Alphonse: You might have heard about a guy called Jorge Paulo Lemann from 3G Capital, right?

Andrew: No, I have to be honest and say no. I don’t know him.

Alphonse: Yeah, the guy in buying the world.

Andrew: Okay.

Alphonse: He bought Heinz. He bought Budweiser. He bought Heinz ketchup, Budweiser. He bought Burger King. And this guy’s a Brazilian.

Andrew: Yeah, I see.

Alphonse: And he’s also an Endeavor mentor. So I was able to spend five hours with him, just getting his advice. “Go this way, go that way.” So this is priceless.

Andrew: This is priceless. Yeah, that’s incredible. I’m reading up on him. He’s the guy who agreed to buy Heinz in conjunction with Berkshire Hathaway, Warren Buffet’s company. And that’s you with him?

Alphonse: Yeah, exactly. He’s in the middle there. And there were ten other entrepreneurs who spent a whole afternoon with him, just talking about Brazil and about our business. And he was able to give his input to us. So that’s the kind of stuff Endeavor helps you with. And not only with mentorship, but also with how to grow your business. How to improve your corporate governance and everything. So pretty cool stuff.

Andrew: All right. I’m glad we talked about them. And you know what? I feel like this interview kept getting better and better. And the audience will tell me if I’m right or wrong because they’re very critical of me, because I encourage them to be.

I’m going to say this was a really good interview. I’m really glad that you’re here and that I got to meet you. Congratulations on all your success with EBANX. I will say to anyone in the U.S. if you are trying to sell to people in South America, especially Brazil, the URL is just ebanx.com.

Alphonse: Dot com. Exactly. Ebanx.com. Like that.

Andrew: All right. And if you like my work here I would appreciate it if you’d go to iTunes and give me a rating. Let’s just say seven stars. And if you can’t do seven stars, give me as close as you can to seven stars. Or, frankly, you guys are hackers. Find a way to hack into iTunes and give me seven stars if you believe I earned it. And if not, give me five. Five is fine too. Either way I’m really appreciative that you guys have been out there listening to my interview. Thank you all for being a part of it. Alphonse, thank you so much for doing this interview. And Alex, as always, I owe you another drink. Thank you so much for hooking us up. Bye everyone.

Alphonse: Bye-bye.

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