If you’re wondering the secret behind Flatpay’s phenomenal growth, I’d recommend 30mins listening to this podcast with Sander Janca-Jensen, the company’s founder.
Key points:
The founding team are not payments people. They came from the alarm industry and realised that the same field sales model could be adapted to distribute merchant services to small businesses.
Growth is remarkable. Flatpay was founded just four years ago in Denmark but is now live in seven markets, has 100.000 merchants, 2000 staff and has hit €20bn run-rate of annual processing volume. Sander says Flatpay is taking an incremental 10% pts of the Danish market each year and 5% of the (much larger) Italian market. The fast entry into Italy is bad news for Nexi (the incumbent) and Worldline (up until now, main challenger).
Flatpay targets 1m merchants by the end of 2029 which would get it close to SumUp’s scale. Flatpay will continue opening new markets where GDP per capita is sufficient for its acquisition model to work. This means the USA will likely come before Poland.
The product set is very simple. Flatpay avoids a “long tail” of product features used by few customers. One terminal, one distribution model (field sales) and no partners to pay commission to. Field sales reps need to generate 20 deals/month and are exited swiftly if they don’t get near to this very quickly.
Sander doesn’t mention Flatpay’s innovative, although controversial, policy of offering free processing on business and international cards funded through a consumer surcharge. Competitors think this is the key factor behind its growth and one that could be replicated by others in the market.
Flatpay never places a job advert for management. All senior hires are from their network or recommended by existing staff. Sander likes BCG/McKinsey people which means we’re talking smart, hard-working people with good people skills. Sander gives them staff roles sitting next to a co-founder for 6-12 months and then moves them to a commercial director job in a new market. Every country MD has been promoted internally.
New markets are opened with a team of 10 people expatriated from Denmark. These are gradually replaced with local hires.
