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Leaders In Payments
Leaders In Payments
Pedro Batista, CEO, UK for Payhawk | Episode 352
Ever wondered how the fintech world is reshaping global payment and spend management? This episode of Leaders in Payments features Pedro Batista, CEO of Payhawk in the UK, who reveals the journey that took him from Porto, Portugal, through heavyweight fintech companies like CurrencyCloud and Plaid, all the way to his current role. Pedro shares invaluable insights into Payhawk's mission to streamline and automate financial operations for businesses, emphasizing real-time visibility, vertical integration, and fraud detection. Whether your company has frequent travelers, is scaling rapidly, or needs more efficient global spend management, Pedro's expertise will provide a roadmap to enhanced financial efficiency.
Discover the innovation disparity between consumer financial technologies and B2B payment systems as we dissect the infrastructure evolution with Pedro. From the potential of blockchain in developing economies to the impact of real-time payment systems like FedNow, this episode offers a comprehensive outlook on the future of payments. Listen as Pedro discusses his passion for leveraging AI to optimize customer service and operational efficiency, along with the importance of adapting to regulatory shifts. We wrap up with Pedro's personal interests in traveling and sports, and his strategic advice for newcomers in the payments industry. Don't miss out on Pedro's vision for Payhawk's future, driven by real-time technology and exceptional customer support.
Welcome to the Leaders in Payments podcast, where we talk to C-level leaders from across the payments landscape. We'll be discussing the products and services that impact the payment space today, as well as trends and predictions for the future of payments. We will also hear stories from our guests about their journeys to the top.
Speaker 2:Hello everyone and welcome to the Leaders in Payments podcast. I'm your host, greg Myers, and on today's show we have special guest Pedro Batista, the CEO of the UK at Payments podcast. I'm your host, greg Myers, and on today's show we have special guest Pedro Batista, the CEO of the UK at Payhawk. So, pedro, thank you for being here and welcome to the show.
Speaker 3:Hi, great to be here and thank you for hosting me, Greg.
Speaker 2:Absolutely. So let's go ahead and dive in, If you don't mind. Tell our audience a little about yourself, maybe where you grew up, where you went to school, where you currently live, a few things like that.
Speaker 3:Amazing. Yeah, so I'm Pedro Batista, originally from Portugal, more specifically from Porto, the second biggest city in Portugal, quaint little town on the west coast of Portugal. I've studied and worked mostly in Portugal until I started my international career. I moved to the UK in 2010, and before that I spent one UK in 2010, and before that I spent one year in Madrid, spain, prior to coming to London, where I'm currently based. I've spent my first professional career. My first 10 years of my career were corporate banking, and I've been in fintech, and most specifically in payments, since 2014,. So 10 years. So 10 years corporate investment banking, 10 years of fintech. I've been lucky enough to help scale companies like Currency Cloud, optel and Plaid ahead of joining Payhawk.
Speaker 2:Okay, great. Well, let's talk about Payhawk, so tell the audience what Payhawk does.
Speaker 3:Payhawk is a top player in the spend management industry. We offer a vertical integration that allows for automation in key areas of the finance function so companies can easily manage and control their global spend-in-one platform. The focus of our products is to provide 100% real-time visibility and control on operational spend, to cut manual work by 50%, to allow month-ends for the finance functions the finance folks they know how important this is the month end to close twice as fast. All of this with very customer-centric approach and incredible user experience.
Speaker 2:Okay, and who would you say is your typical customer?
Speaker 3:So the typical customer is companies that are very focused on automation. They understand that they need to focus on their core business and a company that's trying to scale. They're not setting themselves up for success if they have a tremendous amount of manual work in every single function, mainly the finance function. The finance function is the core foundation of the business and if that is not truly automated remember that the finance function is also serving other areas of the business. So if that is not truly automated remember that the finance function is also serving other areas of the business, so if that function is not automated, it's kind of the rest of the business will be massively impacted.
Speaker 3:So it's all about customers that see tremendous value in automation, real-time visibility, vertical integration. Our system communicates with the ERP system so it allows for bookkeeping, hr information systems, booking as well. So every time they bring a new employee, if they want to give them a payment mechanism, they will immediately be allowed to do that. We have budgets that we allow to be delegated per employees or per departments, and so it's mainly a function of the payment activity for the finance function to really empower their employees that are on the ground representing the company, either with a card or making payments, or what we call the purchase orders, so the procurement system to really be embedded into the system and to be connected with both the HR and ERP systems.
Speaker 2:Are there specific verticals that you focus on, or is it really any kind of business that has, I guess, employees that may be spending money?
Speaker 3:Yeah, so well. There's a few key current threads here, mainly companies where they have employees traveling the world and they need this automation. They really need to have real-time access to budgets so they don't really have failures when they're trying to spend money on representing the company and basically communicating with the system, unlocking those additional budgets. Obviously, you can then deduct from that that any company that has employees traveling a lot, that will be tremendously impactful. So we've learned through the years that obviously logistics companies find our product tremendously helpful. Any companies that are growing very rapidly so technology firms and other areas, that companies that are doubling size every year they need that automation, the real-time creation of users. It's incredibly important. So logistics services companies and any industry that has employees in a lot of the spaces of the globe and or traveling a lot is usually where they see tremendous value In terms of the company itself.
Speaker 3:On the more accounts payable. It's companies that have a high degree of amount of suppliers that they want to play worldwide. This is where they would see a tremendous value from our platform, because we do stuff like we actually read the invoices when they get received. We look at the due dates, we look at the bank account details. We do screening. We can even spot outliers if this is a fake invoice.
Speaker 3:And very famously I don't know if you've seen this there was a rogue actor I should call it that just sent random invoices to Google I think Google and Facebook, I think it were that amounted to $120 million, and those invoices to Google I think Google and Facebook, I think it were that amounted to $120 million, and those invoices just got paid. You can imagine how important it is to have a tool like ours that can really spot if this is a new supplier or not, giving those alerts to the finance function and the accounts payables teams and do the screening. Is this within the pattern or is this a massive difference in amount? Is this a new bank account? So we literally screen everything and we create the appropriate alerts for the finance function to go through.
Speaker 2:Okay, does it matter where the company's based? I mean, obviously you're talking global, but does it matter if it's a US-based company or UK, or is there a geographical restriction?
Speaker 3:Yeah, so, absolutely so. We obviously are a software company that provides regulated products, ie payments and issuance of e-money, as we call it, here in Europe, and we offer our products in the UK, we offer it in the European Union, so Europe or the European Economic Area and in the US. So those are kind of the geos that we are present in, and so these are the clients. So those are kind of the geos that we are present in, and so these are the clients. If they are based here, we can help them. We're thinking of expanding even further than that, but those are the core geographies that we serve currently. But in terms of where the clients of our clients can be based, that's irrelevant. We serve the whole geography the whole world.
Speaker 2:Okay, and how big is the company?
Speaker 3:Great question. So we are now 350 employees. We have presence in eight countries from the US, all over Europe, the UK, as I mentioned, all to the fringes of Eastern Europe, and our main focus is building tremendous enriched capabilities for our clients to have great customer experience going in-depth into the current markets, and for that we continue to be very aggressive in hiring both the GTM functions but also what we call research and development, which are software developers and product folks.
Speaker 2:What would you say? Differentiates Payhawk from your competitors out there.
Speaker 3:Great question. I get asked this a lot, especially in events where I'm either speaking or I'm speaking with senior folks that want to network, and I think Payhawk, I believe, is the best at nailing the two critical areas to be successful in fintech, which is we are amazing at software, where traditionally all the founders they were former software engineers, product folks. So the first two, three years of the existence of Payhawk was really be laser focused on the technology customer experience. Now the company's kind of moved. The last two years mainly since I've joined and a few other folks joined the company is to move, to really be in depth into the payments world, and I believe we are the best at intersecting the two areas.
Speaker 3:We are amazing at technology but we are also amazing at payments. We see certain companies being more focused on technology but having less use of their payments products, and we see the opposite as well Companies that are really good at payments but their technology is not great. So we were very focused in the beginning. The first two, three years of the company was like let's build the state-of-the-art technology. Now the last two years we've basically, whilst in reaching the depth of the technology, we've also been focusing very heavily in payments space. So I think in the two areas I think we are the best.
Speaker 2:Okay, so where do you see payments? And you can certainly answer this around the spend management category if you want, but where do you see it headed, say in the next three to five years?
Speaker 3:Look, there's a lot of chat about AI. There's a lot of chat about digital currencies. I think we are focusing on the wrong area, which is, I think let's think outcomes and work back from that. In the consumer space, we see a tremendous amount of brands trying to crack that market and we saw a lot of innovation coming from neobanks to cross-border payments companies like Wise Revolut cracking those cross-border payments or neobanking. We see less innovation in the B2B space, where we are focused on and I think to crack that you have to think of what are good on, and I think to crack that, you have to think of what are good outcomes. So, in terms of good outcomes, there's nothing more important than you provide great value for money. You're saving people's times, embedded, seamless experience. We think we can achieve that with our vertical integration, with embedding ourselves in the footprint in the ecosystem that our clients use, and embedding ourselves in the footprint in the ecosystem that our clients use and those are, in our view, the HR systems and the RP systems. Only then, I think, we can really add tremendous value.
Speaker 3:So I think it's how is the payment space evolving? Is to understand the nuances of the footprint of the clients that they're targeting and how to embed themselves in that ecosystem to provide those seamless experiences, being either in payroll, domestic payments, being in cross-border payments, being in card payments, being digital currencies. I think it's not just how you deliver the payment itself, but mostly how you embed yourself in the journey of the client and provide that experience, and so our focus is very much of giving reach to clients, mainly by allowing our payments to be spent all over the world, both by card and bank transfers, but also embedding that within the technology that the companies use so they have everything. That's creation of users, delegating authority to the internal users, making payments to their suppliers worldwide in a seamless manner. So this is how we see the payment space evolving.
Speaker 2:Do you see anything around blockchain or things like that that might affect your business? Or is that something that you just might see as a distraction and your clients aren't asking for it, so it's something you just don't focus on.
Speaker 3:I see some value in international settlements and especially in international commerce, of something like blockchain could add tremendous value. I see tremendous value in developing countries to adopt CBDCs central bank digital currencies In a developed world. I see more value in saving and therefore money to companies by being vertically integrated into their ecosystem rather than blockchain itself. I see instruments like digital currencies, blockchain, stable coins being more value adds into development economies where there's massive deltas and massive risk on currency conversion. They tend to be more volatile politically those markets. I see more value into those type of markets rather than the developed markets that we are currently targeting. So, yeah, I think there's a space for all sorts of innovation, but I see more of these emergent payment mechanisms like CBDCs, stablecoins, to be more effective in the developing world and emergent markets rather than key economic blocks like in Europe, the US, north America, etc.
Speaker 2:Right, have you seen any like? Definitely here in the US, I think we're coming up on, or we just passed, a year anniversary of FedNow, so for a while there, faster payments was kind of the buzz, right. Everyone was talking about it. So do you guys see, is that part of your business? Is that anything that you think about, as far as you know those kind of technologies and innovations, which you know, it's been around a long time, but I think it brought some visibility to how businesses could get paid faster from their suppliers or pay their suppliers faster. Do you see that as part of the future or do you think we're already there with the faster payment concept?
Speaker 3:Yeah, it's a great question. I think we are agents of change. Yeah, it's a great question. I think we are agents of change. And what do I mean by that? I mean that we have to play a pivotal role in allowing companies to have real-time 100%, not just 50% of the times. 100% of the times we need to give them access to real-time data. This is a key, important factor of allowing a CEO and a CFO to be tremendously successful. If you're working on yesterday's data, you're already one day late. So this is one core area that we focus on. The other key area that we focus on is allowing the companies to be working capital efficient. What do I mean by that?
Speaker 3:We have payment mechanisms that allow the company to sit on one month of credit.
Speaker 3:We offer credit facilities to our customers to use our payment mechanisms.
Speaker 3:The other one is that, wherever possible, we only use real-time payment mechanisms, being that in the US, being that in the UK, where we have, as you mentioned, faster payments for a long time, we have this here in the UK. In Europe, we have SEPA credit instance, and so we use this everywhere it's possible and the underlying payment infrastructure allows this to happen. What does this mean? So this means that customers don't have to unlock liquidity or lock liquidity I should actually say lock liquidity when the payment can actually be paid in the last day, because we are sitting on real-time rails, meaning you don't have to pay three days in advance because we can pay instantly to their suppliers or their supply chain. So we are just unlocking capital to the company that they can just use to their core business. So we not only are allowing the CFOs and CEOs to have access to real-time data, we are also allowing them to be very efficient in their working capital deployments because of the financial infrastructure that we use, as I mentioned, in the US, in the UK and in Europe.
Speaker 2:Yeah, that makes a lot of sense. So thanks for sharing that. So let's switch gears a little bit and talk about you. So you mentioned a little bit about your professional background, but maybe walk us through what you did and who you worked with and for over the years and kind of lead us up to where you are today.
Speaker 3:From a very young age I was very interested on technology and so I would go and save for months and months and go and buy MP3 player. This is maybe a bit too old for some of our audience, but Not for me, not for you, but MP3 player like a mobile phone.
Speaker 3:So I was always the first one because I was very curious to one experiment with the technology but also understand early on how this would impact the way we live our lives. And so me landing in fintech was kind of marrying two things that I'm incredibly curious, intellectually curious about, which is the intersection of technology and financial services. So technology was kind of very early age, when I was like 10, very curious about technology. When I was in my 20s then I started being very curious about the financial markets, financial services, and so me landing in fintech was kind of marrying the two things that I was mostly curious, intellectually curious about. And so the last 10 years, as I mentioned, I spent in fintech, mostly focused on scaling companies. So I was a very early stage employee of companies like Currency Cloud that was sold to Visa, optel that got sold to WEX, which is a publicly listed company in the US, plaid, working their European team here. And then I landed at Payhawk, mainly to kind of spearhead all of the transition from being deeply focused on technology to continue that focus but also being market leader in the financial services offering. So I lead everything.
Speaker 3:That's kind of the regulated area, which is we have two regulators to give you an impression.
Speaker 3:So we act in three regulated geos, which is the US, we have the UK and we also have the European Union, and so I can mostly focus on having a very robust firm that can lead with changes in regulatory aspects of the business and trying to absorb those and trying to ensure that's a strength of ours and not a weakness, like it happens to be to some of our competitors, and so it naturally evolved to this space where technology and financial services intersect, and so this is mostly my focus as a company as well.
Speaker 3:I'm very deeply curious on how our product impacts our customers' day-to-day operations, and so we do a lot of workshops. I'm very keen on understanding that any pain point that the customers would have, it immediately gets drawn into two or three people in the leadership team which I'm part of, and so we are very laser focused, I would say, in the innovation that we do, in the small nuances that have tremendous impact for our customers, as well as this new world that we face ourselves in the regulated space of being a financial services regulated business by both the FCA in the UK and the Bank of Lithuania in Europe.
Speaker 2:All right. Well, what would you say are some of your most passionate things? So, what are you passionate about? Maybe two examples. Maybe give us one about work and one about your personal life, your true passions.
Speaker 3:Yeah, so at work is to be in the forefront of these massive shifts in technology adoption and how can that have a massive effect on people's lives. So I think AI, as I mentioned, is one of them. I don't think AI is a buzzword for now, but what I'm mostly curious about is how are people going to be more efficient by leveraging AI tools in their day-to-day. I don't see AI as a disruptor of people's jobs. I see it as you're going to be much more efficient if you use an AI tool and we're trying to navigate how would this impact how we serve our clients and therefore trying to incorporate that into our business model.
Speaker 3:From a personal standpoint, I have a lot of interests. I'm very curious about certain areas. I love traveling. I think it's the best way to be intellectually curious about the world different cultures, foods, languages. I've been fortunate enough to travel to more than 60 countries. I'm a huge fan of unique experiences in sports, so I have a pilot license. I do rent planes once in a while to go and do unique travels, for example, going from the UK to France with a few friends. I find that tremendously rewarding. But I love sports as well, so I'm a huge fan of triathlons. I've done a few Ironman, I have to say, before fatherhoods, because now I'm a father of two young boys and so that's kind of another full-time job. But prior to that I was very keen on doing diving in iconic locations and triathlon training, and flying as well Awesome.
Speaker 2:So, pedro, if someone came to you, maybe they're right out of university and they're looking for a job and they find payments and they're like, hey, this is the industry I want to build my career in. What advice would you give them to help them be successful in?
Speaker 3:payments on whether the tectonic changes in the landscape. So what is it that's really going to move the dial going forward? We saw a lot of wave of innovation coming into fintech 10 years ago and those companies started being successful, I would say five years ago. I think now we need to look at what the next big wave of innovation and I think you need to start with a problem and work back to the solution.
Speaker 3:As I mentioned, I think, ai any company that will crack how AI can make the company internally more efficient and externally to self-serve a lot of the big issues that the customers have to give them more data, access to data that lives within their own ecosystem. I don't know how to report that data and just having a query, for example, with an AI bot that can give them the right answer, instead of circulating 20 emails trying to find someone that knows the answer, I think self-serving through AI tools is going to be both a massive shift, technological shift, both internally for companies, internally, but also externally to serve their clients. So I would say how someone can capture that knowledge and bring that tool inside a company, implement it so it can really move the dial, I think will be tremendously important.
Speaker 3:Okay, well, obviously we've covered a lot of ground about you and the company and the future of the space. Is there anything else you'd like to add before we wrap up the show? Real-time, great technology, great customer support and great value for money. So that's the areas that I'm focusing on, and these will be the core drivers of PayHawk going forward as well. Customers will never get tired of all of this incredible service great value for money, saving them time, giving them a seamless experience. I think that will be the core driver of Bayhawk in the foreseeable future.
Speaker 2:I think it's a great way to wrap up the show. So, pedro, thank you so much for being here today. I know your time is very valuable, so thank you so much for being on the show Absolutely, thank you for having me Absolutely, and thank you to all you listeners out there. I appreciate your time as well, and until the next story.
Speaker 1:Thank you for joining us this week on the Leaders in Payments podcast. Make the next story. Thank you for joining us this week on the Leaders in Payments podcast. Make sure you visit our website at leadersinpaymentscom, where you can subscribe to the show and where you'll find our show notes. If you enjoyed listening, please share on your social channels as well.