From stories of midnight phone calls about Russian hackers, to practical advice for how to analyze and learn from fraud events, and all the way through to anecdotes about ants at a picnic, Ron gives an invaluable window into the past, present, and future of fraud prevention.
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Bradley Chalupski: Hey, everyone. This is Bradley Chalupski, co-founder and editor in chief of merchantfraudjournal.com. And in this episode of the podcast, we have Ron Hynes, CEO of Vesta. Had an absolutely hilarious and entertaining discussion with him, decades of fraud experience, and he gave us some incredible stories; getting woken up in the middle of the night with Russians hacking bank systems, having to pull plugs out of the walls – just crazy, crazy stuff. Some great anecdotes about ants at a picnic. And for you practical people out there, some great advice about how to analyze and learn from fraud events. I really enjoyed speaking with you, Ron. Thanks so much for coming on the podcast. I know you guys are going to enjoy it. And as always, you can get all the latest merchant fraud tips and tricks at merchantfraudjournal.com.
Bradley Chalupski: And we’re live. Ron, thanks so much for joining us.
Ron Hynes: Thanks for having me, Bradley.
Bradley Chalupski: So, I feel I have to give a disclaimer before we start this episode. It’s literally been, I think, five months, we’ve been trying to set this up. I’m not even exaggerating.
Ron Hynes: Just make sure everyone knows you were the one that canceled every time.
Bradley Chalupski: That’s true. My daughter, my toddler did result in the cancellation last time. But no pressure, five months in the making, I’m sure it’s going to be well worth the wait. So, why don’t you tell everyone who you are, where are you from, who you represent? And then we’ll jump right in.
Ron Hynes: Ron Hynes, CEO at Vesta. I took over as CEO a couple of years ago. And since that time, we’ve been in the midst of transformation and expansion. And really excited about where we are and where we’re going.
Bradley Chalupski: So, we’re just going to jump right in. I know you have some great stories. So, let’s hear one.
Ron Hynes: I think what’s interesting, first, if I could is, particularly when you think about payments. When we talk about fraud at Vesta, it’s really any transaction where the person on the other end of that transaction has no intention of paying. And when we think about what we do and what our job is, it’s really identifying those folks that don’t intend to pay, and those could be real people or bots or anything in between. But also – and probably more important – facilitating success, for those that do. And it’s not an easy job. It’s a job that a lot of companies, a lot of merchants think they can do on their own. But at the end of the day, fraud and fraud rings is a full-time job. They’ve got hundreds and thousands of people that get up every day, punch the clock, and go to work to try and steal merchant’s or customer’s or bank’s money. And we believe companies like Vesta play an important role and deploy hundreds – in some companies, thousands – of resources and millions of dollars to make shoppers’ and merchants’ life easy and safe, and to make fraudsters’ life hell, quite honestly. One of the more amazing stories, and it’s less payments related, it goes back aways, but really, for me, helps encapsulate, and I think would be interesting for people to hear just how organized fraud can be. Way back in in the dark ages, Bradley, long before you had children, probably long before you even had a job.
Bradley Chalupski: I still don’t have a job, let’s be honest.
Ron Hynes: I was working in a startup in – today what we would call – the challenger or neobank space. We had a great payment processing or card issuing platform, and issued cards all over the US in the hundreds of thousands or millions of cards even at the time, mostly in a payroll capacity. We would [04:59 inaudible] deposit money, they’d have a prepaid debit card that’d access the money and be able to bank. Like you and I take for granted like most people in America take for granted that they can bank today, for sure. I lived in Connecticut, the company was not in Connecticut. And I was sitting on, I think, a Saturday night at a concert or a show or something in my hometown. And my phone was ringing. And it kept ringing, and it kept ringing. And then finally, I said to my wife, “I gotta get up. I gotta go answer this.” And I go out, and it’s a gentleman that runs all of the technology for us, and he says, “Hey, Ron, do we have any programs in Russia?” “No, we don’t have any programs in Russia –”
Bradley Chalupski: That’s a weird sentence to hear.
Ron Hynes: “Why would you ask that?” He said, “Well, we’re seeing a lot of activity – ATMs in Russia.”
Bradley Chalupski: There’s literally no way that this is ending well at that point.
Ron Hynes: I said, “Go pull the plug out of the wall right now.” He said, “Oh, I don’t know if I can do it.” I said, “No, seriously, pull the plug out of the wall.” So, we had been, obviously, infiltrated. And it was a single account, and it was proliferating all over the globe, people were taking money out of an account. So, someone had gone in and taken all the balance limits off that account. Velocity checks, gone. Everyone’s first reaction is “Oh, someone in the company is doing some bad stuff. They found a way in, they got hired.” We quickly found out that wasn’t the case. And the interesting thing and the organized nature and the depth that these things can go is illustrated by the fact that I was sitting in the office with the gentleman that ran technology at the time, and he said, “Watch this, Ron.” He’d go in, and he changed the pin on the card manually. In theory, okay, we’re good. 10 minutes later, someone’s withdrawn money with the new pin. Long story short, we did lose some money. We did shut it down quickly. And it taught us a valuable lesson in systems and security architecture. And again, this is early 2000. So, this is the bleeding edge of financial inclusion and fintech and all of that. But what doesn’t kill you makes you stronger, and that’s one [07:50 inaudible], it was just amazing.
Ron Hynes: And then even with that, fast forward seven or eight years, and I’m at MasterCard, running prepaid globally, and we had a similar event on a MasterCard bank-issued prepaid card. And this one is well known; it was Bank Muscat. And it ended up being tens of millions of dollars that were stolen in a matter of few hours overnight. And that led to MasterCard building out, at the time, we called a security blanket across all ATM transactions globally, where we would look at things and find, quickly, issues like that. Never been repeated. But there were thousands of individuals at ATMs around the world, just draining the ATMs of cash off this one single account. Because they had gone in and basically made it a no-limit credit card with no velocity checks and no systems.
Bradley Chalupski: There are a couple of angles I want to talk about on this. This is really fascinating to me, this whole security architecture; that’s definitely one thing I want to talk about. I’m also curious to hear about prepaid versus other types of cards and what the difference is there. But let’s start with the security architecture. Obviously, we only have 40 minutes or so but take me through, just in 60 seconds, what the problem was and how it was addressed in the future and what you learned from that at the architecture level.
Ron Hynes: I’m not the tech guy but I’ll give you that. At the time, I think, I was Chief Strategy Officer. First and foremost is, again, it goes back to how I opened the conversation. Fraudsters are working full-time. The wife or their husband packs their lunch pail, they go to work, they sit down at a desk like you or me, and they just spend all their day trying to find holes. And they poke, they poke, they poke, and they find their way in. I’m not going to get into how these guys ended up getting in, but they did get in through a lapse in our protocols, which we were able to quickly close and adjust and move on. And I think it’s the kind of thing where… I’ll give you an analogy that I like to use about ants at a picnic. You’re going to have your second child soon. And hopefully, a few months after that, you, your wife, and your two children will head out for a picnic, and you find a nice place, and you lay everything out beautiful. All of a sudden, there’s an ant, and then there’s two, and then there’s then, and then there’s a hundred. You eat quickly, you get done, you pack everything up, and you close up shop and you go away. And all of a sudden, the ants go away. And then the next family comes and they sit down and they go through the same thing.
Ron Hynes: Fraudsters are a lot like that. They’re out, they send the ants out. They’re looking, they’re looking, they’re looking. They find a hole. And now all of a sudden, all the ants get the signal, and they all come. So, it’s not just about closing down a hole breach, an opportunity, and forgetting about it. This is why I believe we’re not a network security solution. But it’s why companies in this space, like Vesta, are so critical for – in our case – the merchants. Because you stopped it one time, you haven’t stopped the next one. And with our data science, and machine learning, and the algorithms, and a little bit of AI, heading more and more the way down the road. But we are constantly updating, we’re constantly addressing attacks. We’re allowing ourselves to ingest a certain amount of fraud so that we can continue to learn. We talk about driving the true cost of fraud to zero. And that’s a goal. That’s not about eliminating fraud altogether, it’s also about ensuring that good transactions get done. But we’ll never eliminate fraud because if we do, we’re not going to be ready for the next wave.
Bradley Chalupski: I think that’s a really interesting point. And I did like a lot, actually, what you said at the top of the episode here, which is that the fraud is not just about stopping people that are trying to steal from you, but it’s also about allowing the people that are legitimate customers to get through it. And I think that’s something that we come back to time and time again, this interplay between chargeback fraud prevention versus making sure that you are minimizing your friction for customers, because certainly in today’s online environment, your brand and your customer experience is one of your top selling points because most people are selling the same widget. So, unless you want to get into a price war that spirals down to the lowest common denominator, you’re going to be able to differentiate yourself based on how you’re treating your customers. And so I think that’s a great point that you’re making. And I’m curious how you think internally, as a team, about these problems when you say that there’s a breach. And then you sit down, you have your meeting, and you say, “All right, what happened?” Once you put the fire out and everybody can take a second and breath. What do those meetings look like for you? What are you trying to discover? Take me through the process, maybe, of how to actually retro one of these things so that you can get those types of insights for the future and prevention.
Ron Hynes: First of, I’ll just share with you, generally, our customers tell us that there are two aspects to what we do, which actually build upon what you were just talking about. First and foremost is peace of mind. Whether it’s Vesta or a company like us, we provide peace of mind knowing that, you know, almost think about it like an insurance policy; I pay you little bit, I cap my risk, and anything above that is not my problem, someone [14:51 inaudible] owns it. We do. We shift the liability of fraud from the merchant to us. We told you that transaction was good for you, it’s good. But the second piece, and the most important piece, that our customers talk about. And I think a lot of times, even when we’re working to win a new customer or develop a new partnership, the sexy part of what we do is the fraud. Everyone can picture the guy in a hoodie in a dark room somewhere, banging away on a keyboard with a stolen credit card. With that blanket, everyone can wrap themselves up and feel good, and it’s what scares people the most. But what most of our customers six, eight, 12 months in are more impressed with is the revenue uplift that they’ve seen for, really, no incremental costs, just by facilitating and ensuring that transactions that had good customers on the end of them that fully intended to pay, are able to pay and are able to complete that transaction. And it depends on the customer, but we work not only in the US, we have a big piece of business in Latin America. We’ve opened up in Southeast Asia. And when you go into some of those markets, it’s not uncommon to have a customer who starts out at 60% approval rates. And taking someone from 60% approval rates to 75% or 80% approval rates, that’s 25% or 30% revenue lift for, again, no real incremental costs.
Bradley Chalupski: And that’s [16:43 inaudible] you’re actually accepting, that’s not even when they come back as a repeat customer because you didn’t send them away the first time.
Ron Hynes: And now there’s more money to invest back into things like marketing to drive more [16:54 inaudible]. I think that’s what a lot of folks forget is businesses, large and small, spend an outsized portion of their operating budgets trying to convince people like you and me that they have something worthwhile. They get us there. And then when we want to make a payment, they shoo us away. And when we help facilitate the throughput of more good transactions, it’s not just about the revenue uplift, now there’s that much more money to invest back into, bringing more customers to that website, and selling more. We have events every day, we have fraud every day, and we’re constantly working to update our algorithms so that the models reflect new patterns and different things like that. We have a team of folks that we call analysts that pull out transactions, review them, learn quickly so that we can feed that back in and update the models. It’s a rare occasion where we have the type of event where we all get to sit around the room and say, “What the heck happened? And how do we make sure it doesn’t happen again?” The bigger conversations that we have on that are actually; “Why aren’t approval rates heading the way we want them to get customer X or that we committed to?” And in most cases, we will not only commit to a guarantee on the payment side, but we’ll commit to an increase in approval rates over time as well for those customers.
Bradley Chalupski: I think that’s also interesting and kind of the actual points maybe that I want to get to or more. How are you thinking about these things? For a merchant that’s sitting, listening to this, and struggling with approval rates or with chargebacks with balancing them; what advice would you have for them for just how to approach the problem? Because I think for a lot of people, it’s overwhelming to even just think about, “I don’t even know what the framework is here that I’m supposed to be working.” And forget how to solve something out of that framework.
Ron Hynes: I think that’s a great question. And what we do spend a lot of time talking about is balancing. Again, that’s what I told you. It’s not about zero fraud. It’s about finding the intersection of fraud and approvals where we’re maximizing not revenue in this case, we’re maximizing operating profit by incurring more fraud so that we can approve more transactions. And I think that’s what where particularly merchants who’re trying to do this on their own get sideways, is they spend more time worrying about armageddon than they do trying to balance an acceptable level of fraud in order to have the best customer experience for their customers in, whether you want to use the word frictionless or facilitating the successful combination of a transaction. My advice is hire a company like us to do it for you because we do it 24 hours a day, seven days a week, 52 weeks a year. We’re good at what we do, and we stand behind it.
Bradley Chalupski: This is a point that we’ve made a lot, and I’m happy to make it again, which is that I don’t know, maybe you have some insights on this if it’s more fear, or at this point, more ignorance, but I would feel like I’m failing at my role in the community if it’s still ignorance that the name of the game is to make the most amount of money. And that doesn’t always mean preventing the most amount of fraud. And sometimes that gets lost on merchants because it is painful as we’ve said many times on this podcast, it is painful. It feels like theft when this happens. And obviously, if the problem gets bad enough, you can lose your processing privileges entirely and there are cascading effects. But at the end of the day, you’re trying to make the most amount of money you can. And if you’re sending away good people and burning your marketing budget, which is an excellent point that you alluded to that we don’t talk about enough, that in the long term is going to actually be less revenue than taking a few chargebacks.
Ron Hynes: I think that your point around the kind of unnatural pressure that the networks put on merchants from a chargeback perspective creates kind of a third dynamic for them that they have to balance. I don’t think there’s a merchant out there that doesn’t understand the risk-reward dynamic of “Listen, the more I approve, the higher my revenue.” There is an acceptable level of fraud. But if I’m approving 65% of the transactions and I’m incurring 1.5% fraud, it’s not just about approving more transactions; you got to be approving the right ones. And that’s where, I think, many merchants fall down is they just don’t have the skill set or resources to be able to look and make a decision based on a multitude of factors, including the consortium network effect of all the transactions that we look at every day, every week, every year. And it creates, really, an insurmountable challenge. It would be one thing if you had someone who’s approving 65% or 75% of all transactions and they had five basis points of fraud, then I would agree with you, then why aren’t you just [23:46 improving] more transactions? But when it’s flipped and you’re getting those results and you’re still incurring – what by industry standards is – a very high level of fraud and chargebacks. That’s a tough math equation to try and justify doing any better. And again, that’s where a company like Vesta and others out there adds a tremendous amount of value.
Bradley Chalupski: I do want to touch real quick on if there’s a difference between the prepaid cards and your more traditional cards. I don’t know. That’s actually an honest question. I’ve never really heard someone make the clear distinction the way that I felt like you were when you were talking. Do you see that those types of prepaid cards are, in general, more risky for people? And if so, why?
Ron Hynes: No, not at all. I’m just giving you because I spent 15 or 20 years of my life. I mean, a prepaid card is really a debit card. There’s no difference from a card perspective. How the money is kept in the background is really the fundamental difference that creates some efficiencies for the platforms like Chime or someone like that today. But no, there’s no fundamental higher level of risk score or anything like that. I think that was a general belief 20 years ago, but that’s not true.
Bradley Chalupski: So, next story.
Ron Hynes: Let me think of one here. You’re putting the pressure on. Well, I guess what I’ll share with you is – so, we have a deep history in Telco. And in fact, Vesta started out as, more or less, a distributor of prepaid phone minutes. And then built almost a clearing house engine is the way I would think of it. And then built a payments platform to service, at the time some of their largest customers who continue to be our customers today, companies like AT&T and T-Mobile in the US, Tel Sell down in Mexico, British Telecom and Vodafone in Europe. And that is where Vesta began, really, building a machine learning capability and data science capability around fraud. And most people kind of scratch their head and say, “Well, what kind of fraud is there in Telco? That doesn’t sound very risky to me.” And again, going back to my earlier comment: in order to have fraud, you got to have someone who’s initiating a transaction that doesn’t intend to pay for it. The other piece is, that person needs to be buying something that someone else finds [27:18 no] value, and there has to be a secondary market. And this is what got me excited when I first started spending some time and working with the Vesta management team and the Vesta board before I actually joined as CEO. And if if someone is able to – let’s use Tel Sell as an example – go on to the Tel Sell platform and purchase or top-up prepaid phone minutes. So, again, not a prepaid card, as we were discussing before, but prepaid phone minutes.
Bradley Chalupski: I’m old enough to remember doing that when I was younger. I had those indestructible Nokia phones that will be here with cockroaches at the end of days, I had one of those things. And definitely know what you’re talking about.
Ron Hynes: So, in most of the world, prepaid phone minutes are still the majority of how people get access to cellular, and today, even the data plans, and things like that. But if a fraudster is able to go on and top up or purchase – let’s use Tel Sell again as the example – the reality is they’re on the street; those 30, 40, 100 minutes around the street and available for sale in the black market at 80-85 cents on the dollar, in a matter of minutes. And the fraudster makes a ton of money. The person buying it gets a great deal, they’ve got access to phone minutes at 20% or 25% discount. The only people that really lose in this case are Tel Sell. And I was blown away at the impact that Vesta had had over the course of four or five years in the case of Tel Sell in doing just what we talked about in taking the approval rates from – I won’t give numbers – but from a modestly low number with high fraud to world class approval rates and managing fraud down to a very, very respectable level.
Bradley Chalupski: So, take me through that process. I’m really curious because this is the type of thing where it’s a good or a service that is being used by a lot of different people, it’s really hard, I would think, to come up with a really onpoint model for this, because it’s such a wide number of people purchasing it, it’s such a wide number of use cases, amounts, where they’re coming from. When you’re sitting down with a company, and they have this type of really low approval, high fraud environment, and you’re starting with someone new. So, let’s take it out of the context we had before if it’s an event, an ongoing thing, but somebody comes to you and they’re new, and they say, “I have this incredibly difficult fraud problem to solve.” Where are you guys starting? Are you starting with humans that are looking at this? Are you letting the machines at it first and then letting the humans in after to look at the edge cases? What is the process that you go through?
Ron Hynes: It’s a little bit of everything, to be honest with you, Bradley. But first and foremost, we start with the algorithms, and the models, and the machines. Let’s use Telco and prepaid phone minutes as an example. And I think it’s important in that context to think about, you know, Vesta built its legacy in what we call digital goods – nothing physical. So, as soon as we say, “That transaction is good, and those minutes are good.” We do the same with Western Union and a few channels for them. As soon as we say that money transfer is good, there’s a human on the other end waiting for that money. And if it’s real, or if it’s not real, they’re going to get that money, and that money’s gone. In this industry, in physical goods, there’s an ability to penned a decision. I can approve it on the front end. You’re sitting there, buying, and on your screen, it’s approved. It’s pended in the background. Someone looks at it, looks at a bunch of different factors, and says, “You know what? Let me send a note off to that customer and tell them, ‘Yeah, don’t send the sneakers or the TV or whatever it is.’” We’ve been working with AT&T for 20 years. So, we have 20 years worth of history of changing fraud trends. We are about to launch a new Telco customer in Southeast Asia, and we’re very excited. I can’t tell you who it is because we haven’t announced it yet.
Ron Hynes: We don’t build bespoke models, we take the models we have, we layer them in for this new customer, the transactions run through humans – sample transactions and ensure that we’re doing what we should. There’s a lot that goes into it. We have two different ways: we have behavioral data that we collect while someone is on a site, and then we have payment data, which comes through in the transaction. And that, coupled with our network or consortium of data from, again, 20 years – not relevant – but for the last few years, hundreds of millions of transactions, billions and billions of dollars. We continue to adapt and adjust. We know there’s a learning curve. We’re going to, in all likelihood, incur more fraud early on, even at lower approvals. But we will incur that fraud at the expense of approvals so that we can continue to train the models, or the models can continue to train themselves. And over time approach, again, that intersection of where is the maximum approval fraud to ensure that our customer – being the merchant, in this case; or the Telco, in this case – is getting the best experience possible? And that for our shareholders, we’re maximizing the return of our dollars as well.
Bradley Chalupski: So, I want to throw a little bit of a curveball question at you, which I usually like to do. I’m curious, given how much the industry has moved towards machine learning, and algorithmic technology, and a lot of data, and geek scientists kind of stuff. What do you feel is the value of experience on the human side? If any. Not just the models are running longer, they have more data. But from your end, as someone who’s been in the industry for so many years, I’m curious to hear what you think you do differently and what you’ve learned that is still relevant. Again, that’s a curveball question. We’re very in favor of human fraud analysts. So, I don’t want you to think that it’s a negative question. I’m just curious to hear from your own mouth, how you think that that’s helping you on a day-to-day basis, and the people that you’re working with?
Ron Hynes: I think there’s a couple of things. It allows us to quickly pull things out, and look, and ensure. Our goal, again, is not to be 100% non-human. At the end of the day, the machine is as good as the people that build and continue to make it work. It does train itself. But left to its own devices, I’m confident that it wouldn’t be as good as it is with… And again, I don’t want you to think of it as human intervention. It’s human interaction and human learning, coupled with machine learning. That really, I think, makes us. And I think most of our competitions, same way, it makes us as good as we can be for ourselves and for our customers.
Bradley Chalupski: We feel the same way that the human interaction part is really important. And we’re constantly encouraging merchants to make sure that they pay attention to that because I do think that it’s easy for people to get caught up – it’s not even hype, I don’t want to call it hype, because machine learning is amazing, and it’s real science, and it’s great at what it does. But to think that it’s a panacea that it’s just going to cure everything, and you could just turn this thing on, and just let it go, and that’s it. And you don’t need to have people behind it. Sometimes I think we’ve gone too far in the general marketing climate of the industry that merchants feel that it’s just all this box of algorithms somewhere and there are no humans. And that’s not the case at all.
Ron Hynes: Not at all. And I told you, I’m not a techy guy. I am a general manager. I didn’t start out building anything. I just know how to hire good people to do good things.
Bradley Chalupski: It’s a great skill to have.
Ron Hynes: Yeah, I’m all about people. And we have a great team that goes at it every day.
Bradley Chalupski: So, I want to ask you, before we wrap it up here, I’m curious with all the experience that you have across all these different years, and industries, and geographic locations, what you think should be the future of the industry and where it’s going?
Ron Hynes: Which industry?
Bradley Chalupski: Of the fraud prevention ecosystem and industry generally. Because in the last, well, say, five years, six years, 10 years, there’s this huge chargeback focus. And now we’re starting to see a lot of new payment methods come out, and a lot of new things come to the fore, cryptocurrency being one but there are others. And I’m curious for someone who’s been able to watch transitions. Because not everybody that we have on this podcast is really able to speak from so much experience and watching things evolve.
Ron Hynes: Not everyone is as old as me. Is that what you’re saying?
Bradley Chalupski: Not everyone is as knowledgeable as you, Ron. Not everyone is as knowledgeable as you. And so I’m curious to hear from you who’s seen this before, where do you think we’re going? And what you think about all this kind of new emphasis on crypto money, and less chargeback focus, and online selling now, and where that’s going with AR possibly which could open up an entire new Pandora’s box of fraud once we get the Google Glasses or Apple Glasses, which we’re waiting for? I’m waiting for my apple glasses. You see, I got that the AirPods in. I’m waiting for those glasses. What what do you think? Where are we going from here?
Ron Hynes: I’ll go back to how I started this. A little bit, maybe not all the way back to the beginning of the conversation. But fraudsters get up every day and go to work. So, regardless of where payments move; crypto, there’s a lot of talk today around real-time payments, bank-to-bank payments. Fraud is not going away. They all have husbands and wives, and kids, and families that like to eat every now and then. They go to work every day figuring out how to make more money. I’m 100% confident that we’re not going to eliminate fraud from the face of the earth; that’s not going to happen. Even that’s our mission – a world without e-commerce fraud; that’s what we get up and get excited about every day. Not that we believe we can eliminate it, but we believe we can create a world where it’s, at least, less damaging. Going to your comment around Google Glasses, which, by the way, when I was at MasterCard, we had a bunch of pilot sets of Google Glasses, and it’s got to be going back almost eight or nine years. So, that tells you how fast things are not moving in some cases. But at some point, there’ll be an ability to authenticate, that is less invasive. Today, there are ways to authenticate that create more friction than merchants like, and are more invasive than consumers would like, to some extent. When there’s an ability to authenticate, you’ve eliminated the risk of fraud.
Bradley Chalupski: Let me give you the other side of that, which is that once the authentication is someone’s body, somebody, somewhere figures out how to manipulate that, then you’re really in trouble. And that’s kind of what I’m getting at. Somebody does like a James Bond; I can duplicate your retina somehow without you knowing. I mean, the possibilities for theft, in terms of volume and speed, are infinite, almost, it seems.
Ron Hynes: No, there’s no doubt about that. And that’s why I say, even when you can get there and you have this authenticate — I’m not worried about that I’m running a race that we’re going to come to the end too, and companies like Vesta don’t have a role. Fraud [42:17 inaudible] payments, fraud, as long as billions and trillions of dollars continue to move between buyers and sellers, there’s going to be tens of thousands or hundreds of thousands of people that get up and go to work every day, trying to get a piece of it illegally. Keeping that ecosystem safe and keeping it efficient is a job we take seriously. And we, and again, not just us, I would say, folks in this space will continue to evolve and adapt to ensure that we continue to provide a valuable service to today merchants. Mostly that we focus on, there’s an equal opportunity on the issuer side as well that maybe next time we talk, we can chat about that.
Bradley Chalupski: Yeah, for sure. I’m fascinated by this whole futuristic — I feel like we hit an inflection point when I was probably around 15-16. I’m of that generation. I was born in ‘84. So, I didn’t have a Facebook account until college. I did have access to a PC because my mother is an OG programmer. So, I had a PC from a young age, but a lot of people in my generation did not. So, I’ve kind of watched the technology. I’m comfortable with it. But I also don’t have to have it. I knew what the world was like before it was there. So, it’s very interesting to me, I kind of feel my generation maybe is uniquely placed to understand just how quickly things can change. Because it happened right when I was 17 or 18. And now I think about how different the world was when I was growing up versus what it is now and the things that you can do now that were just unthinkable even when I was a kid, even just 20 years ago.
Ron Hynes: Brother, if it makes you feel any better, when I was a kid, we had to get up from the couch to change the channels.
Bradley Chalupski: Yeah, so there you go. I think there’s not enough being about it right now because there’s not an immediate-immediate need. But I think about sometimes when my kids are wearing glasses that are interfacing – what’s going to happen if somebody hijacks the glasses while they’re driving, and says, “If you want to be able to see, someone better send me whatever in the next five seconds or you’re going to die.” Because they know that you can just say “Pay this account,” and then the money will go. You’ve come up with all these permutations and possibilities. And I think my generation is more open to thinking about those things. Well, I think the generation behind me would be like, “Ah, we’ll figure it out, whatever.” And the generation above me would be like, “Ah, that’s not going to happen,” or “That’s crazy.” Whereas my generation goes, “No, no, no! We saw this. The whole thing can just change on a dime. And if I can think it up, then maybe it’ll happen.” And so it’s an interesting topic to me.
Ron Hynes: I think, along those lines, it wasn’t that long ago when MasterCard and Visa were going to be irrelevant because, first, the Telcos were going to take over all the payments rails using the wallets on the phones, and then Facebook and Apple and Google and others were going to do that. And then consumers resisted wallets because they were afraid; “Well, what if someone gets my phone? Now they can go and they can spend my money.” There’s a number of things that came out of that. One is, everyone learned that running a payments network is not easy. MasterCard and Visa – they make it look really easy, it’s not easy. And they’re really good at what they do. And secondly, consumers started to understand that the risk, the form factor of how a payment gets done doesn’t really change the consumer risk profile, especially if you’re using the networks. The networks have done a great job of protecting consumers in a way to encourage consumers to feel comfortable taking a card out and swiping it.
Ron Hynes: Listen, I can go back to a day when I first had a debit card, and I would go to the grocery store, and I would refuse to pay with a debit card, which is just like paying with cash. But because I didn’t want the cashier to think I was using a credit card and that I couldn’t afford my groceries. That’s a stigma that you got to overcome, and it takes time. I get that there may be some magnitude of risk that comes in with the evolution of technology, there’s also a magnitude of safety and security that will come with it.
Bradley Chalupski: I’m sure Elon is on the case. That’s my goal on this podcast is to get Elon on the podcast.
Ron Hynes: He’s on the [47:28 case] if he’s not on the moon.
Bradley Chalupski: Yeah, well, or Mars. I know. Elon, if you’re out there listening, if you want to come talk about Tesla’s security and how you’re going to protect the Internet of Things, please, we’re all ears, we’re here. I’m here for you anytime you want, day or night.
Ron Hynes: Bradley, I appreciate it.
Bradley Chalupski: Yeah, Ron, it was a great conversation. Thank you so much. Tell everyone where they can find you on the web, and then we’ll sign off.
Ron Hynes: www.vesta.io.
Bradley Chalupski: All right. Thank you so much for joining us, Ron. Hopefully, we could do this again sometime.
Ron Hynes: Thanks, Bradley. Take care.
Bradley Chalupski: All right, take care. Bye.
Ron Hynes: Bye.