International credit card and finance firm Visa is opening a start-up R&D center, the company announced this week, and has signed up its first four members, said David Page, co-creator and innovation partner at Visa Europe Collab.
“Israel is known as the ‘start-up nation’ and its entrepreneurs are turning their creativity to the fintech arena,” said Page.
With the move, Visa joins fellow credit card firm MasterCard, which has been working in Israel for over four years. But Visa has not been avoiding Israel; in fact, the entire Visa Europe Collab financial technology hub, as the program is known, is brand new. The first Collab hub was opened in London at the beginning of May, and three weeks later, Visa has opened its second Collab branch – in Tel Aviv.
The Collabs aim to take advantage of the parent company’s many connections in the fintech business to discover innovative new technologies being developed by start-ups.
“Visa is in a unique position to help innovators develop and scale their ideas,” said Steve Perry, founder and co-creator of Visa Europe Collab. “We have 50 years of industry expertise as well as the connections and scale offered by more than 3,000 European member banks and financial organizations. Now, through our innovation hub, we are creating a network of partners and a community that will help us provide the mentoring, advice and experience start-ups and entrepreneurs need to get their ideas off the drawing board and into the commercial world.”
As a center of fintech innovation, Israel fits that model, said Page. “Four Israeli companies – Zooz, Prontoly, Payitsimple and MyCheck – have already entered the Visa Europe Collab innovation pipeline and more fresh and exciting concepts are coming through the door every day,” he said.
Each of those four firms is already accomplished in some way, having been recognized for its innovative technology. MyCheck, for example, which has developed an app that allows users to pay bills at restaurants, bars, hotels, and other places of entertainment using their smartphones – a long-sought after financial technology goal, turning the smartphone into a kind of credit card – recently scored a $5 million investment from the Santander Innoventures Fund. According to Mariano Belinky, who manages the fund for one of the world’s largest banks, “Santander’s investment in MyCheck highlights our leadership in financial technology, investing in services which seek to benefit customers in their everyday financial transactions.”
Another start-up in the Visa program, Zooz, is a veteran of TeXchange, a program that brings promising Israeli fintech firms to London to build up connections, meet potential investors, and even get some customers for their nascent technology or product. Zooz, which directs credit card payments received by retailers to the least expensive acquirer, potentially saving users thousands of dollars a year, also recently picked up a $12 million round of investment led by Blumberg Capital. “There is clearly a need for an advanced payment technology that can help businesses stay ahead of their competition through optimization and technology differentiation, and that is where Zooz excels,” said Alon Lifshitz, partner at Blumberg Capital, who will be joining Zooz as a board member. “We have been very impressed by their innovations and rapid growth in the global payments market.”
Those are the kinds of companies Visa is looking to enroll in the Collab program, said Page. “We have 50 years of industry expertise, the connections and scale offered by more than 3,000 European member banks and financial organisations and now a network of partners from across the fintech ecosystem who can offer their advice. The combination of these things puts Visa Europe Collab in a unique position to offer entrepreneurs with great ideas a means to turn them into commercial reality.”