The Prepaid Press - July 15, 2008 - (Page 8) PREPAID BUSINESS July 15 · 2008 - 8 Bertrand Sosa, President and Co-founder, MPOWER Labs Interviewed by Gene Retske Brothers Roy and Bertrand Sosa are the epitome of the all-American success story. After coming to the U.S. in the late 1990s, they saw the dot com revolution, and began to wonder how millions of underbanked Americans would be able to buy things on the Internet. They knew that the plastic cards used for web purchases were out of reach for most immigrants. Seeing how prepaid calling cards were sold, they envisioned a company that would create digital dollars from cash, using prepaid MasterCard and Visa cards. But, it was not an easy thing to start a company with such a lofty goal, at least not with the $750 they were able to invest. Now that they have made NetSpend into a company that processes over $4 billion in transactions a year, they are turning their considerable entrepreneurial talent to helping others create companies to serve the underserved. 5 MINUTES WITH Let’s say you have a good idea for how to bank the unbanked in Africa. And, you have this new mobile payments technology. We would have, at MPOWER Labs, a group of interested entrepreneurs, such as Roy and myself, that are really focused on looking at your concept and how we can expand on it, take it to market faster or grow it more rapidly. GR: What kind of support can you provide? BS: Assistance with technology. Maybe you are missing a key component of technology. Maybe there is a security issue that you haven’t addressed. Maybe you need server space in some colocation facility that you don’t have, and for you to get that would cost a million dollars. Maybe you need a relationship with Visa or MasterCard that your product is going to need to really get to fruition. Maybe you need to get into the door of some retailer. Maybe you are looking to launch a prepaid program in India, and don’t know how these programs function. Or, maybe, you are looking to do a microfinance project or a p-to-p lending community and you don’t understand how that technology works. MPOWER Labs has a slew of experts in the area of financial services, specifically looking at how we take these innovations that are brewing up everywhere and connect the dots to deliver a cohesive experience in market. GR: What investments have you made so far? BS: As our first investments, we made an investment in a mobile payments company, Sapphire Mobile Systems, out of Philadelphia, that had an interesting platform. I say, ‘had,’ because since they have joined the MPOWER family of companies, we have overhauled their technology, so that it can deploy around the world faster. GR: Let’s start at the beginning. Why are you and Roy starting a new venture? BS: Given the history of my brother and I as entrepreneurs, and what we have been able to do with prepaid debit, we got hooked on the ability to generate tremendous wealth for a company, but, at the same time, make a tremendous social impact. That impact being the ability to bank the unbanked. As we think about the two billion people that are underserved, you are talking about a lot more people outside the US that are underbanked and unbanked. For Roy and I, it became a matter of how we could expand our horizons and look at delivering products and services to these people that are underserved on a global scale. GR: What do you mean by ‘underserved’? Unbanked? BS: That is correct. You are talking about people all over the world, India, China, Latin America, Eastern Europe, you name it. Let’s just say that we are overbanked here in the US in many respects. But, outside of the US we fall quite short. GR: I like the word ‘overbanked’. BS: Yes, you are talking, on average, people carry 4 to 5 pieces of plastic in their wallet. I would say that is superbanked. Roy and I were born in Mexico, so we know that there are places out there that need these types of products even more so than the US. We started thinking about how we would address this challenge. That is one of the first reasons why we left our day-today roles at the first company we founded. It is doing great, and we are proud of what NetSpend has been able to accomplish and what we were able to do in an executive role for eight years. GR: You were comfortable enough at NetSpend, so why the change? BS: As entrepreneurs, we want to explore and do more. It became a natural transition for us to focus on a global market rather than just a US Introducing iPay Station: Get on board. iPay Station is a suite of products and services that turns any retail merchant into a 1-stop-shop for the unbanked, under-banked, or convenience shopper. » Prepaid calling cards and wireless minutes. » EZ bill pay connected to 5,000+ billers nationwide. » Prepaid MasterCard » Convenient, low-cost money transfer. All available on a virtual or POS terminals. Easy-to-use. Easy-to-sell. Supported by FREE marketing in English or Spanish. play. GR: You started two companies, right? What are they about? BS: As we were thinking about how to set up this new venture, we realized that we needed to start from the actual funding and resources that we were going to put into play to make this happen. So, our first entity that we created is MPOWER Ventures. MPOWER Ventures is unlike a traditional venture fund. It is a fund. It is an investment partnership, but it is a double bottom line investment partnership. GR: What is double bottom line? BS: The limited partners of this fund committed to each other that we are not going to look at things that don’t have high profitability and a high social impact. GR: What do you consider high social impact? BS: We have to be investing in things that help people lead better lives. We start with financial services because that is very close to what we have done before and a natural bullseye for us. Especially when you consider how far you can take someone in terms of empowering them with a financial product. GR: Who are the partners in MPOWER? BS: The partners are my brother, Roy, myself, and a third entrepreneur, who has built a very successful business with a nutritional supplements company called OmniLife, Jorge Vergara. He is a Mexican billionaire who operates in a very similar fashion to us in that he places a high value on businesses that yield not only a significant return on investment, but also have a social impact. GR: I guess I still don’t understand why you created two companies. Can you help me? BS: Having that alignment with Jorge is what set the stage for us to start thinking about what kind of products and services we wanted to bring to market on a global scale. But, we couldn’t go and start investing in companies right away because Roy and I realized that, as we once experienced as entrepreneurs, you may have a great idea, and you may have a passion for something, but ultimately you are going to need a certain type of infrastructure, and a certain type of aid to get there, so we created MPOWER Labs. GR: What does MPOWER Labs do? BS: It is a platform that helps entrepreneurs launch products and services worldwide. GR: How does that differ from MPOWER Ventures? BS: MPOWER Ventures is really the money, but MPOWER Labs is the, as Roy calls it, the space shuttle launch pad. “You are talking, on average, people carry 4 to 5 pieces of plastic in their wallet. I would say that is superbanked.” Then, there is the REV network of companies, which is a ‘dream’ network of payments innovation. REV refers to dreams. They are actively focused on delivering retail financial service products to areas of the world that have severely underserved populations. GR: Are you buying these companies? BS: We invested a majority stake. These are investments. Sometimes, we create the companies from within. GR: The mission is to serve the underserved in the world? BS: That is correct. Our mission and focus is to deliver products and services that are going to address the needs of the two billion underserved worldwide, so that we can deliver access to payments. It can be prepaid, mobile payments, microcredit. However we can deliver that access to these two billion people underserved, we will spend time and money doing so. Bertrand Sosa is President and Co-founder of MPOWER Labs. Please visit MPOWER Labs online at www.mpowerlabs.com or email info@mpowerlabs.com. Excellent reseller deals now available. Get lifetime residuals. Call Osvaldo Rodriguez at 800.432.7787 or visit www.ipaystation.com. http://www.mpowerlabs.com http://www.ipaystation.com http://www.ipaystation.com
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