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Tech Tales №8: Michael Rolph, Co-founder and CEO at Yoyo Wallet

Culture is a huge deal for us at Kyan and forms a significant part of our company brand. But understanding that culture is influenced by leadership (and it’s not just a ping pong table, and beers on a Friday) is something that many businesses fail to understand. Good culture drives great work and forges an environment where brilliant people can be just that – brilliant.

Michael sings from the same hymn sheet as us, as well as appreciating strong cultural foundations, he’s also, like us, an advocate for scaling at speed. This hunger for good culture + rapid growth was all too apparent when Michael joined us at one of our Campus events a few months ago, which is why we decided to sit down with him and talk further about spending, startups, Brexit, product design and the seemingly seamless work he’s doing with his company, Yoyo Wallet.

Hi Michael. For those who don’t know Yoyo Wallet, what’s it all about?

Yoyo is a commerce tech platform for the omnichannel retailer. The product sits on both sides of what we call the ‘transaction coin’. On one side we have a product that the consumer is engaging with, and on the other side we have a product that the merchant engages with.

For the consumer, we are an app called Yoyo. So if you’re at university or you’re in a corporate canteen, you’re using the Yoyo app to buy your coffee and your lunches everyday whilst seamlessly collecting loyalty points as you do so. Plus, an itemised digital receipt. If you’re on the high street, Yoyo could be a retailer-branded app that’s powered by Yoyo. So for example, Caffè Nero’s app is completely powered by Yoyo.

Effectively, what we’ve built on the consumer side is a mobile architecture that enables us to quickly and scalably launch many retailer-branded app experiences. If you’re a retailer that’s already got an app and you would like to have the power of Yoyo in it, then we have an API and an SDK that you can plug in to as well.

On the merchant side, Yoyo enables retailers to get to know their customer. Based on their purchasing profile, preferences and behaviour, we are able to show them who their customers are and how they’re transacting with you. This is something that online retailers have been able to do for some time, but in the physical world of retail, which is still 85% of all transactions, that’s not been possible. So we make that possible. If a customer is transacting online too, we can match those online and offline transactions together. We also provide the tools to retain that customer lifetime value, and more importantly, grow that customer lifetime value in the form of highly-personalised and targeted marketing campaigns.



How have you seen rewards change over the years, and do you see it being baked in with people’s everyday spending?

There are different layers to rewards. Is it the merchant or retailer who’s rewarding you? Is it a brand? Is it the bank, like a Monzo or a Barclays? Or the card issuer, like American Express? As consumers, we are getting used to being rewarded in multiple different ways for how we transact. So I don’t think that too much has really changed over the last five years or so. All these traditional methods of being rewarded still exist. What Yoyo has found is new ways to aggregate all of that into one seamless experience. For example, it’s quite possible that you can use your AMEX card to transact via a Yoyo Wallet, and at the same time you’re earning your AMEX points, you’re getting your stamp from Caffè Nero. What we are also seeing is that digital is the front-end enabler from an experience perspective and it very much enhances the consumers own journey and experience around collection of different rewards. So for example, Yoyo was the first to enable you to use your existing bank card to transact through chip and pin or contactless. And if that merchant was powered by Yoyo, then as soon as you get your loyalty points, your stamps, your receipts, it’s not just within your app powered by Yoyo, but it’s also in your bank account (in this case, Starling).

Monzo recently announced their points model, and the reality is that Monzo are now issuing you with some arbitrary points that they’ve created – a scheme of their own making with no inherent value in those points. But they’re hoping that they can go and sell those points to merchants. A little bit like Nectar in many ways. These points interchange models have been proven over the years to have failed, so I’m not holding out too much hope. That’s not to say they haven’t got a chance of making it work. It’s just not necessarily adding more value.

Michael (right) with co-founder Alain Falys (left).

You’ve worked with PayPal and Barclaycard. How would you compare life at these bigger businesses with working at Yoyo?

That’s a good question. I’ve got to find the first-person and third-person answer here. For me, I’ve found that having a corporate foundation and being someone at the beginning of their career, I had a lot of ambition, as most people do at the start of their career. You think you can run the place one day. In hindsight, I might have been a little bit different because not everyone thinks that from day one.

I found those environments to be incredibly useful for me to learn my subject. I was very curious, so I was always able to find somebody somewhere within those organisations who was able to tell me something new that I didn’t necessarily know that morning when I woke up.

So I think big corporates enable you to really immerse yourself within the industry you’re in. But you’ve got to be curious and you’ve got to be persistent. Because the flow of information within an organisation isn’t seamless, it doesn’t flow like a river. It’s in pools here and there and you’ve got to be really good at jumping between the different rock pools of knowledge. Somewhere like Yoyo, starting from scratch, that knowledge and communication does flow seamlessly, purely because of the number of people. But as you grow, these different silos of information do start to pocket, because more people means less chance or frequency of seamlessly communicating. So we created an organisation, culture and structure that is optimising for seamless verbal communication as the primary method of working together. But at the same time, we’re native within Slack, so we don’t have an email culture where everyone’s inbox can obviously build up.

The best thing you can do when you start anything is to validate. People should be saying ‘yes’ to your idea.

But for me, I would say the primary difference is cultural. I’m somebody that was born in those corporate environments where I felt like if I was somebody that wanted to be better, there was always a reason why you had to go slower. I don’t believe in creating an organisation where the people who want to be brilliant feel like they have to go slower. We should build an organisation that feels like people who want to be brilliant can go faster. And that’s purely down to leadership. That’s the first person answer.

If you were to ask some people at Yoyo what it would be like in previous roles, I think it would boil down to what I’ve just said – there’s no expectation that you should ever wake up one morning knowing that the reason why you didn’t achieve what you wanted to do by the end of the day is because of somebody else. There is no excuse. You make things happen at the pace that you can make it happen. If you felt like it could have been faster and it wasn’t, and it was somebody else’s fault, then you have to go and tackle the problem. We’re pretty good at holding each other accountable. It’s not a culture of “If you don’t do something you’re going to get hit.” It’s “If you don’t do something you could have felt you could have done, go solve the problem, and tomorrow go and do it.”

Some of the Yoyo team enjoying some rooftop merriment in September 2018.

As a startup advisor, what do you look for in a promising new company and what are some of the consistent growing pains that you see?

The irony of the startup advisory network is that a lot of the people have never done startups. So my startup advisory life before Yoyo is very different to what it is now. I think that’s quite an important point here – a lot of early stage startups that have come through these different campus models are awash with advice from people who have never really built a company themselves. But they’ve maybe succeeded in a bigger corporate, or are domain experts, such as marketing or sales. And actually, that advice at the time is largely irrelevant because you haven’t got to the point where you need that advice yet.

If I go back to what’s important, the best thing you can do when you start anything is to validate. Validation is about selling the idea. Have you got enough people that believe in what you’re doing? They should be saying yes to your idea and therefore look like customers, look like employees, or look like people that are going to give you money. These are the people that are going to go with you on your journey. As you grow, the type of advice you need is about recognising that you don’t do startup to be “anti big company”. If you are, there’s a problem. You do a startup because you want to be a big company. Therefore you should be seeking the advice of the people that know what it’s like to structure, to organise and to create processes. What you then have to do is to overlay your own unique DNA, and that DNA is the culture aspect of what it means to be a company of your time.

If you look at the differences between companies that have succeeded and have failed over the last 20-30 years, the Amazons, the Facebooks, the Apples, technology is the core of their DNA and their thinking. They’ve embraced internet and digital natively versus some of those older companies that are now no longer with us, like Kodak, being the obvious example.

I think that a lot of the advice that I was being given was that a startup is meant to be anti big company and ‘big companies suck’. No they don’t. They make a lot of money. You can achieve a lot within your own startup journey by becoming a big company and by thinking about the culture you want to create. And it really is all about culture. That’s going to drive success. Create an environment where people can come to work and be the best version of themselves. Big companies can suck at that. And that’s not to do with anything other than leadership.

Culture drives success. Create an environment where people can be the best version of themselves. Big companies can suck at that and that’s not to do with anything but leadership.

Any growing pains of your own on the tech side of your business?

If you asked that question ten years ago the answer would be different for a company that’s five years in. We’re very lucky to be cloud native. Our tech infrastructure and stack looks like most company’s dream roadmap. If you were to go and speak to a CTO in any company that started life ten years ago, they aspire to have the infrastructure and stack that we’ve got now. We got it out the bag. Our problem isn’t around building scalable tech. We’re now at 1.5m+ registered users, transacting millions and millions of times a month, and I have to say that one of the things I doesn’t keep me up at night is wondering whether the transactions are going to keep flowing.

For me, the scalability challenge is ‘how do we get Yoyo more international more quickly?’ We are international and we are following our customers, but obviously I want more customers. For me it’s a sales challenge. We’ve got amazing technology and amazing customer experiences, and we want more customers now and faster. I have a different type of challenge to think about – rather than scaling tech, I think about scaling sales. I think about how much more product we can put into the hands of customers. There’s lots of different ideas and directions we can take with Yoyo, but fundamentally I want to be iterative, and that’s a core value of ours. Ship early and often and then apply the learnings to iterate.

On the subject of growing internationally… the B word, Brexit… do you see our possible exit from the EU as a concern to how you do business aboard?

I have a couple of different answers. I’ve got my own, human-level answer, and I’ve got my entrepreneurial “I’m going to get on with it” answer.

My personal answer is that I think Brexit is the worst idea ever conceived. I think the direction of humanity should be that we are all one. We should challenge this historical constraint around borders and the genetic lottery that says if you’re born in one country versus another country, it should define how you work through life. It’s just nonsense. Fundamentally, are we better as a single European Union? Yes. For a whole number of different reasons. That doesn’t mean that a lot of things can’t change about Europe though.

Now let’s get to the practical realities. Quite frankly, as an entrepreneur and a CEO of any company, if Brexit happens, it’s a kind of “So what?” We have to deal with it and my job is to build a company that’s successful no matter what the environment around it is. So if Brexit happens, we’re going to carry on to be successful because we’ll do all the things we need to do to continue to trade and take advantage of the fact that Brexit will throw up as many opportunities as it will challenges. If Brexit doesn’t happen, see my first answer. Fantastic.

The essence of product design for payment apps seems to be speed – allowing the user to whip out their phone and pay quickly. What tech considerations have you had to make when building an app to be used on the move?

20% of people now use the Yoyo-powered app at Caffè Nero. And the reason they do that is that it’s obviously made something about that experience better. When you look at early interviews around “Why does Yoyo need to exist?” it’s because payment’s not broken and people are collecting loyalty just fine. The reality is, we’re not solving a payment problem and we’re not solving a loyalty problem. We’re improving an experience. End-to-end, the transaction experience has many different facets to it, and I describe them as being wrinkles in the bedsheet. If you look at the process of someone going into a shop, there’s a queue. That’s a wrinkle there that could be solved. Someone needs to pay, they need to get their wallet out and they’re paying by cash. There’s another wrinkle. They’ve got to collect a receipt, and it’s put in their hand before the change and the change drops all over the counter. There’s a wrinkle there. Do they or do they not have their stamp card? Another wrinkle. On top of that, the retailer wants you to come back, and they’ve got to think about how they can target you with marketing offers that are going to be specific to you. There’s wrinkles there too.

So Yoyo came along and designed a process and experience that said: “This is all just one and the same thing through one single scan”. And that’s through an in-app QR code that is scanned at the till. In that single moment, you’re transacting and earning loyalty points and stamps, you’re getting your rewards, you’re getting your receipt, you’re getting the ability to share you rewards and your receipt, and you’re getting targeted with offers based on your behaviour.

There’s very little point in a retailer saying to you: “Hey, here’s a half price croissant with a coffee” if you’re already buying croissants. But there’s absolutely a worthwhile reason to do that if you’re not buying croissants and that retailer wants to change behaviour and incentivise you to buy a croissant. Yoyo takes both the user experience and the merchants desire to sell more stuff into equal consideration - understanding that there has to be an exchange between the two. Yoyo users get personally rewarded to a level that makes them want to come back for more and merchants receive the purchase data that delivers real customer understanding, enabling them to target and up-sell in way that is 10X more effective than their competitors.

So this is all happening around us day in, day out. It's marketing, it's advertising. But it’s doing it in a way that the consumer always has control. We call it ‘commerce technology’ and it's what we believe will be the next phase of marketing. The combination of financial technology and marketing coming together to create this new world. A place where as a consumer you should have the ability to control the what, the where, the when, the how.

Yoyo HQ in Bloomsbury, London.

And finally, what’s on your phone right now? Are there any finance or payment apps that have impressed you lately?

I think this whole thing about neo banks is nonsense, if I was to put something out there. I don’t think enough people are talking about this, essentially they are massive punts that if you get big enough you will maybe figure out a business model, in the meantime just keep burning investor bucks at an ever increasing rate. Outside of Tandem, who actually did launch as a proper bank by acquiring a bank, these neo banks aren’t really banks. They’re not getting current account business where you’re paying your salary in. They’re just a cash replacement or budgeting replacement. Which is what cash used to be used for. So as cash is becoming electronic, the card’s the natural place for it to happen. So the likes of Monzo, Revolut and Starling are just a better way to do it. Of the ones I could use, I use Starling, because I really like Anne Boden. She really knows what she’s doing and I like the fact that they’re building real bank tech.

I use Slack because without that I don’t really function. Netflix, BT Sport for UFC. And lots of different apps for people that do the components of what we do, but I’m not going to name check any of them because I don’t believe they’re going to be around for long enough because they’re building features not businesses. I’m looking forward to launching Yoyo’s in-app pre-ordering experience that’s coming soon. Little teaser for you there.

Lots of different apps that come from merchants that aren’t powered by Yoyo, because I need to remind myself every day about how bad an app experience can be or to inspire what we could do better.

And Amazon. I’m a very recent convert to Amazon. That’s because we’re doing the office up here, and it’s the quickest way for me to buy all the stuff that we need.

It is a good app for a website that has millions of products, you never feel particularly lost. Have you seen their shops, where you can just walk in, grab a product and pay just by leaving?

Yeah, that I don’t believe in so much. It’s not to say in the future we’re not going to be going that way, but to me, that’s a 1% experience. 1% of the population will enjoy doing it and find it neat. But the other 99% will actually feel uncomfortable. And this goes back to Yoyo’s philosophy from a product design perspective. Our job is to build 1% incremental improvement into how people behave today. That’s how we focus our time. I could invent the future today and build it technology-wise, and spend a lot of other people’s money doing it, and it will fail. Amazon can do that because they have lots of money, and people’s jobs are to fail regularly to set a direction and tone for the future. But here we’ve got to make sure we’re winning, and we only win by having incremental improvement day after day.

Check out Yoyo, or find out how Kyan can help your business with payment solutions on our Payment services page.



Keep an eye open for Tech Tales №9! Looking for a previous Tech Tales?

Tech Tales №1: Megan Caywood, Chief Platform Officer, Starling Bank
Tech Tales №2: Jonathan Lister Parsons, CTO, PensionBee
Tech Tales №3: Josh Hart, CTO, yulife
Tech Tales №4: Edmund Greaves, Deputy Editor, Moneywise
Tech Tales №5: Elise Nunn, Head of Ops, Plum
Tech Tales №6: Will White, COO, Loot
Tech Tales №7: Melanie Palmer, CMO, Exo Investing



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