Why Dwolla charges 25 cents for an $11 million transaction - CEO Ben Milne

TL;DR

Dwalla is a payment company that aims to provide an alternative to credit card fees by building its own network. Users can make payments without paying credit card fees, making it an attractive option for businesses and individuals alike.

Transcript

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Key Insights

• 😘 Dwalla's low-fee network challenges traditional payment methods and aims to provide a cheaper alternative for businesses and individuals.
• 🤨 The company has gained significant investor interest, raising over $22 million in funding.
• 👤 Dwalla's focus on compliance and security helps them mitigate fraud risks and maintain the trust of their users.
• 🧘 The company is positioning itself as a potential competitor to established payment companies like Visa and Mastercard.

Questions & Answers

Q: How does Dwalla's network work?

Dwalla's network allows users to connect their bank accounts and make payments without using credit cards. The network acts as an alternative to credit card processing, allowing users to bypass the associated fees.

Q: What sets Dwalla apart from other payment companies like PayPal?

Dwalla distinguishes itself by offering lower transaction fees, with anything under $10 being free. They also aim to build a network that can eventually compete with existing credit card networks, providing a more cost-effective and efficient payment solution.

Q: How does Dwalla handle fraud and security issues?

Dwalla has invested in fraud infrastructure and takes a proactive approach to prevent fraudulent activities. They implement strict compliance measures, such as onboarding processes and identity verification, to ensure the safety and security of their network.

Q: What is the future outlook for Dwalla?

Dwalla aims to continue growing its network and expand its services. The company plans to vertically integrate its sales efforts, invest in technology development, and build a strong executive team. They also see potential in supporting multiple currencies in the future.

Summary & Key Takeaways

• Dwalla was founded by Ben Millan, who was frustrated with the high credit card fees his e-commerce company was incurring. He started working on creating an alternative payment solution that would bypass these fees.

• The company launched in December 2010 and has raised over $22 million in funding from investors such as Union Square Ventures and Andreessen Horowitz, among others.

• Dwalla's network allows users to make payments without using credit cards. They can connect their bank accounts to the network and make transactions with low fees, with anything under $10 being free.