MasterCard's Simplify Commerce

https://www.simplify.com/commerce/

by sachinag • 13 years ago

176 127 13 years ago

sachinag• 13 years ago

Complete competitor to Stripe and Balanced and Braintree.js. Just a teeny bit underneath pricing for all - 2.85% versus 2.90%.

rsync• 13 years ago

... which is a fairly terrible percentage rate. Even a small processor should be able to get under 2%, provided you don't have a lot of fraud/chargebacks.

There's a tremendous amount of froth in those rates.

jusben13695• 13 years ago

You can do better than 2.9% for sure but I'm not sure about under 2% for a small merchant in CNP.

dangrossman• 13 years ago

2% is below CNP interchange on a lot of card types. For example, it costs the processor 2.95% to charge a Platinum MasterCard or 2.05% to charge a World MasterCard card as CNP. A processor charging less than interchange is taking a loss; it's paying the merchant more than it'll get funded by charging that card.

The flat-rate pricing these new aggregators offer at 2.7-2.9% already builds in taking a loss on some cards by making it up on ones with cheaper interchange rates. To go below 2% flat rate and make a profit is near impossible. The only place you'll find that is somewhere like PayPal, with $100k/mo or more in volume and a negotiated contract, and they can get away with 1.9% because many of their payments are balance-funded or ACH-funded at nearly no cost.

2.2-2.5% is much more realistic and you'll still need a minimum monthly volume to get it.

Or we can all set up retail stores and abandon this e-commerce stuff. Rates are much lower when you can swipe a physical card. The real profit-taking is happening in those card readers you can pick up at Staples/BestBuy/etc from Square/PayPal/Intuit/GoCardless where they're collecting 2.7-2.9% and paying half that in interchange.

mbesto• 13 years ago

provided you don't have a lot of fraud/chargebacks.

A large chunk of the costs associated with taking payments is fraud. (see founders at work - Paypal[1]) So assuming you don't have a lot of fraud is wishful thinking at best.

[1] http://jesse.la/lessons-from-founders-at-work-stories-of-sta...

irollboozers• 13 years ago

You'd think someone like Mastercard could actually provide a significant enough percentage difference to matter. 2.85% is still way too high.

mehulkar• 13 years ago

Seems identical to stripe?

levosmetalo• 13 years ago

US[A ONLY | ELESS].

kylelibra• 13 years ago

The entrenched payment companies are definitely scared of competition, but by launching clones of their competitors they show they still don't get it.

agilebyte• 13 years ago

I think that their target audience are (mom & pop) businesses (about to go online) happy to trust the Mastercard brand, not programmers that get uppity about seeing yet another clone & complaining about an API.

eightyone2• 13 years ago

"Deposits are made into your account in two business days in most cases."

This is awful copywriting. There's not even an asterisk with more information or anything.

angersock• 13 years ago

Jesus, this looks kind of like a desperate in-house hackathon product pushed live before the execs could kill it.

(Props to the development team! You still need better docs though. :( )

kevinbluer• 13 years ago

Couldn't have said it better :)

jacquesc• 13 years ago

This seems a bit cynical. Either Mastercard is changing their organization around from the top, or there happened to be a rogue product team that managed to fight their way through the bureaucracy to launch something cool.

Either way, props to em.

subsystem• 13 years ago

http://blogs.computerworld.com/it-leadership/21657/how-maste...

aquark• 13 years ago

I'd like to see one of these 'API friendly' companies compete more in the physical space to.

Basically something equivalent to Square with a Stripe-like API and lower rates for swiped transactions.

NKCSS2• 13 years ago

Can't find anything about chargebacks, wonder if they are free :)

larkarvin2• 13 years ago

$12 for charge backs https://simplify.desk.com/customer/portal/articles/1173584-h...

pvnick• 13 years ago

I wouldn't trust anything that comes from Mastercard or Visa directly. I would much rather have the companies' idiosyncrasies and politics abstracted through a 3rd-party service like stripe or balanced. That's just my kneejerk reaction, take it or leave it.

CoachRufus87• 13 years ago

Why not? Millions trust them with one their most important assets: cash.

ericd• 13 years ago

On the merchant side, the picture is a lot less friendly than the consumer side. With a traditional merchant account, there is basically a march of monotonically increasing fees here and there that add up, and are only brought back down a bit when someone wins against them in court.

alphamale3000• 13 years ago

Yes! We'll save 0.05%! That's 500$ for every million in sales. You must have huge sales to justify a switch.

memset• 13 years ago

If you're doing a million in sales, you should negotiate a rate with your CC provider which will be far lower than the list price. All of the providers - Stripe, Braintree, PayPal, Authorize.net, and most likely these guys - will negotiate a rate with you, and if you're doing any volume you ought to give them a call and ask.

When you call, they will ask you two important things:

1. What is your current volume (if you're looking at switching from someone else)

2. What is your chargeback rate? (How often do angry customers call the credit card company to issue a chargeback against you?)

If you are growing and have increasing transaction volume, and you aren't defrauding your customers, then you can absolutely get a lower rate than you're paying now.

This is true for so many things in business - the list price means nothing!

greghinch3• 13 years ago

To play diplomat, I see a lot of Stripe loyalty / Mastercard hate already brewing here, and I think that's a bit unwarranted. Stripe has certainly earned their place as a cherished service, but I would venture to bet a lot of devs worked quite hard on Simplify as well, so it'd be nice to see discussion on the merits of the offering rather than preconceived notions of the provider.

If nothing else, even if 0.05% isn't much, I'm happy to see if they can start a bit of a pricing war here. If it drives payment costs down across the board, all the better.

pc8• 13 years ago

(I built the first version of Stripe and work here.)

I think the unfortunate aspect of these clones is that they're lazy. I have huge respect for anyone that innovates in payments -- I know how hard it is, and I'd imagine it's even harder to do that as part of a larger company.

What I find disappointing is when a product copies everything about Stripe -- everything from Stripe.js to the "live/test" switch to the "1/2/3" getting started pop-up when you create your account to the nomenclature of "InvoiceItems" to the ordering of tabs in the account settings.

It's certainly MasterCard's (and anyone's) prerogative to do that, but I don't think it's particularly worthy of support from other engineers and makers.

We should encourage each other any time we see great, original work -- creativity is hard, and new ideas are often delicate in the early days. It'd be really cool if MasterCard did that, but Simplify unfortunately doesn't seem to have anything that's new. (Please correct me if I'm wrong!)

breck2• 13 years ago

Two day payouts looks like a great innovation to me. :)

jusben13695• 13 years ago

Look at the bright side. This is complete validation for your approach. Now MC is copying your business model and got to market strategy. You're defining the landscape. Powerful stuff.

white_devil• 13 years ago

PLEASE tell the world why it's so damn difficult to let non-US businesses use a payment service? We're dying to know.

Is it because of bullshit regulations everywhere? Why has it taken you forever to set up shop in a couple of places in Europe? Why not the rest too?

Seriously. What is it?

sjtgraham• 13 years ago

Don't worry, it's not worth considering. Continuing to innovate, is.

greghinch3• 13 years ago

That is fair. I've only seen Stripe from the outside, and haven't even actually implemented it on any projects. Certainly I can appreciate how frustrating and disappointing it is to have some established player in the greater ecosystem come in and build a nearly direct copy of your service. I'm also sure that there's much more to Stripe, and payments in general, than the API and docs, and it's highly unlikely they can come up with a copy of the rest of the company.

loceng• 13 years ago

This is what businesses do, they copy. Hopefully they improve something, but otherwise the end result is the more competitors, the lower the profit - the more competitive and therefore the more benefit to the end user. No matter what industry you're in, service you're offering - people will copy it / do it themselves. It's really an innovator's dilemma (not referencing the book). Once you innovate and find a better way, the optimal best way - that is how others will do it. The power big giants have is copying to stay competitive (rich get richer..), and really they must to stay alive and relevant - even if it ends up being a zero sum game. Facebook does the same thing, Google does the same - though they produce actual innovation themselves, meanwhile I'm not sure what Facebook has uniquely created, even their beginnings were a copy so it's in their DNA. MasterCard will likely leverage their brand name and try to get long-term partners of theirs using their service and not Stripe or others. They validated your market though, so focus on growth, and perhaps a MasterCard competitor will want to try to buy you at a premium -- assuming that's what you want.

sheena• 13 years ago

(I also work on Stripe's API and dashboard.)

I actually find it more interesting that quite a few of the obviously copied bits aren't even really worthy of copying if you're already going through the effort of building an entirely new product -- they're pieces of our product that could stand to be improved. :)

jacquesm• 13 years ago

Stripe.js is copyrighted content. The rest is not too big a deal but if they've copied your software (even if it is JavaScript) that's not legal.

antr• 13 years ago

The SV expectation/mentality that if someone builds something first they "own" that space is unjustifiable. I'm not say you are saying that, but it is an implicit attitude in the Valley.

Competition (or "clones") were around 100 years ago, continue to exist today and will be around for the next 100 years. Today's innovation is tomorrow's commodity thanks to competition. This is good.

Is it disappointing that MasterCard launched a similar service? Sure, I would too be disappointed and I sympathise.

Having said that, stating that "a product copies everything" is not really true. They can not copy execution, culture, customer service, customer loyalty, etc. You have that on your side.

People think that Ford Motor was one of the first (if not the only) car manufacturer in States in the early 1900s, but it was quite the contrary. The car was a revolutionary technology: it had a combustion engine, it was fast, etc. Over 100 car companies were launched in the early 1900s. All of them car startups. When the technology goes in one direction it is difficult to be the salmon that swims upstream, in the opposite direction. To tell those +100 car startups to "go and innovate, I own the combustion engine on top of four wheels" is simple unrealistic. Expect competition, that's my point.

How did Ford survive having less resources than many others? How did Ford survive the great depression? Execution. It improved the assembly line, vertically integrated to bring more production in-house, etc.

Stripe's case should be no different. Today's technology and innovation is commoditised in months. Execution can't be commoditised. Don't expect competitors to rest on their laurels.

presidentender• 13 years ago

Stripe's terms of use prohibit both weapons and virtual currencies. If Simplify's terms of service prohibit either, I can't find the relevant paragraph. That alone makes Simplify somewhat more attractive.

nazka• 13 years ago

It is something I don't understand... It's not possible to patent/copyright the whole design of website to see it as a whole product? And avoid people to do exactly the same design?

ww520• 13 years ago

On the bright side, MasterCard has validated the space and your work. Visa and Amex might buy you out to compete in good time. Don't feel discouraged.

Volpe• 13 years ago

Surely you (Stripe) must have known that providers would respond.

If people are saying "Feature X in stripe is awesome", it isn't lazy to copy, it's smart (That's what startups would do). They quickly catch up to your product and hopefully (for them) innovate further.

I get you'd be flustered/angry you have a worthy competitor (with way more resources than you), but companies don't have to be innovators to be competitors. You innovated, and got first mover advantage, now comes the competition.

7Figures2Commas• 13 years ago

...but I don't think it's particularly worthy of support from other engineers and makers.

Simplify might be a Stripe clone, but if it's just as reliable, cheaper and allows me to get my hands on my money faster, why shouldn't I consider it? I'm an engineer/"maker" but that doesn't mean that I select commodity services based on emotion or ideology. After all, saving money and getting my money faster supports my ability to continue making stuff.

I need to accept payments online. I am your customer. You should be trying to convince me that Stripe is the best payment solution for my business, not labeling a new competitor "lazy" and suggesting that I avoid it because it opted not to reinvent the wheel.

We should encourage each other any time we see great, original work -- creativity is hard, and new ideas are often delicate in the early days. It'd be really cool if MasterCard did that, but Simplify unfortunately doesn't seem to have anything that's new.

I really, really like Stripe and think you have built a great service but reading this makes me cringe.

Innovation and first mover advantage do not guarantee success. In fact, sitting back and following can be a smart approach: it's less risky and less costly to let others invest in new ideas and "copy" what gains traction in the market. I know this is blasphemy in Silicon Valley, but it's the harsh reality of business.

We'll see if the market finds Simplify's lower pricing and faster payouts compelling enough, but I don't think it's fair to insinuate that the only source of legitimate, meaningful and effective differentiation comes from building something "original".

confluence• 13 years ago

Original work doesn't exist. Everything is a remix of old ideas. For example, one could argue that Stripe is just a copy of one of the many already existent payment processing APIs, with better marketing. What exactly do you do that's so different? Better ad copy?

And honestly, the things you say are "copied" are fairly lame things that anyone could've done. It's not like they stole any secret sauce, like when Boeing used industrial espionage to steal information on rocket manufacturing from Lockheed Martin.

Competition exists. You don't have a right to monopoly. Suck it up, because you just aren't that original.

foobarqux2• 13 years ago

Entering into a price war would kill Stripe: it does not have sustainable low cost advantage.

greghinch3• 13 years ago

Yet. I don't want to necessarily speak for Stripe, but I seem to recall when they were first opening to the public, one of their main goals was to get to the point where they no longer needed 3rd party providers for the services they offer, and could then drive the costs down. Could be mistaken (or things could have changed).

appleflaxen• 13 years ago

I don't hate Mastercard nearly as much as I love competition.

The existing credit card companies have an oligopoly on payment, and the more people there are in this space, the better options we will have.

jusben13695• 13 years ago

0.05% is a tiny amount. This is the first shot though across the bow on lowering the transactional rates set by Stripe, Braintree etc.

jusben13695• 13 years ago

"Sign up and develop. When you're ready to go live, tell us a little about your business."

It's actually more of a "PayMill" model than a Stripe model. So they allow you to begin development but they don't actually promise immediate on-boarding.

ceejayoz2• 13 years ago

Stripe does exactly the same thing. You have to enter some business details like tax ID, sales volume, etc. to go live.

diggan2• 13 years ago

As usual, there is no information at all on which countries that is supported, I guess this is only supported in USA. Maybe I'm the only one outside of America...

Edit: Yeah, after registering, confirming my email and trying to apply for a full account, I know that it's only for America. Sigh...

sleepyhead• 13 years ago

"At this time, however, the merchant must be a U.S. business."

https://simplify.desk.com/customer/portal/articles/1173591-s...

diggan2• 13 years ago

Cool, in Support -> Home -> General, couldn't be more visible. Tried searching for "country" in the support-area, no hits, no more time spent searching.

jrgnsd• 13 years ago

I had to read through the Developer Terms of Use to find that out.

mattparcher• 13 years ago

Something that caught my eye: the name "Simplify" is pretty close to "Simple", the online bank service.

Different products entirely, I realize—but heck, Simple’s twitter handle is even @simplify.

justinreeves• 13 years ago

That was actually what drew me to the headline. I saw "Simplify" and thought it was about my bank.

eightyone2• 13 years ago

I made the same connection.

joelrunyon• 13 years ago

Jumping on this thread for a flyer.

Any stripe devs know if it's possible to integrate with infusionsoft.com? That integration would make me so, so happy.

jkuria• 13 years ago

I completely agree. And with 1ShoppingCart too. I considered using stripe but they didn't integrate with any of the popular shopping carts that handle affiliate marketing type of features. So I have to pay for two merchant accounts and a load balancing gateway. I also live in fear of my funds being frozen any moment or losing sales if I go over my processing limit.

rudros2• 13 years ago

Check out https://www.simplify.com// (the double slash ending is important).

joshrice• 13 years ago

What was there? Just getting a 404...or is that your point?

rudros2• 13 years ago

Ahhh, they shut it down already. It was a page with links to login to their JBOSS admin pages and such. You needed passwords, of course, but still, not the sort of thing you want clients to randomly stumble across.

dutchbrit• 13 years ago

Do they also accept Maestro debit cards?

jusben13695• 13 years ago

US only.

gesman• 13 years ago

It is only supported in USA. I'm in Canada. Next please ...

jackbravo• 13 years ago

If MasterCard can create an international version of this product before Stripe, then this will be big.

kawera• 13 years ago

At this time, however, the merchant must be a U.S. business

Oh well...

AndyJPartridge• 13 years ago

I was going to post the same thing.

Hope Stripe get there first, as I'd like to support them over Mastercard.

sideproject• 13 years ago

With clones of Stripe poppin' up everywhere, I think the niche advantage would be to be able to scale the service to a number of other countries where this type of service is either expensive or unavailable (please come to Australia! - I know there is "pin", but we wouldn't mind a cheaper alternative without any monthly fees!)

lbarrow2• 13 years ago

Have you looked at Braintree? We're charging 2.4% and $0.30 in Australia, with no monthly fee.

patrickk• 13 years ago

Paymill is one of the clones (the Samwer Brothers are behind it), they cover many European countries:

https://www.paymill.com

zt2• 13 years ago

I find this to be a really interesting business decision for MasterCard. MasterCard cannot offer this service directly on their information systems because of there own rules and the antitrust consent decree.

So what have they done? They've built a wrapper around Priority Payments Services, an independent sales organization of Wells Fargo. (For reference, Stripe is also an ISO of Wells Fargo Merchant Services).

Which is all a long way of saying that MasterCard went pretty far out of there way to build this system. They must really see value in selling directly to merchant developers.

There is another possible story here: maybe the ISO wanted to compete with Stripe, they built the system and site, and asked MasterCard for their branding.

foobarqux2• 13 years ago

Mastercard can see almost exactly how much Stripe is growing, I don't think they needed to be very perceptive in "seeing value in selling directly to merchant developers".

zt2• 13 years ago

Not to be flip, but I haven't found that MasterCard or Visa are particular great at data analysis. Additionally, I would be surprised if MasterCard could easily figure out the information you suggest from the data they get. I could be completely wrong, but I've seen them have enough trouble figuring out interchange charges -- their core business -- let alone random analytic facts about (so-called) competitors.

To my immediate recollection ISO 8583 (the standard set out for credit card transactions) doesn't have much info on independent sales organizations (a different ISO acronym). This is all to say that the transactions are through a merchant account set up by Stripe for each particular merchant at Wells Fargo Merchant Services, then through First Data and only then hit MasterCard. Again, I'm not certain, but I'm not sure its a question they can easily answer from their data.

larkarvin2• 13 years ago

This is cool, but much cooler if they will support businesses outside US. it seems i'm stuck with paypal and Payment gateway in the Philippines are way too pricey for our business

tlrobinson• 13 years ago

BTW MasterCard has a whole bunch of other interesting APIs available: https://developer.mastercard.com/portal/display/api/API

kephra• 13 years ago

Its still stupid credit cards.

Most eCommerce sites have a profit margin of less then 10%, often around 5%. Charging 2.85% + $0.30 kills most business ideas.

jwilliams• 13 years ago

Restricted to US individuals and companies only... I'm not sure why sites don't call that out from the get-go.

sangaya• 13 years ago

It is not restricted to US individuals, just US Businesses. "Using Simplify Commerce, you can create payments with credit and debit cards carrying major card brand logos for customers anywhere in the world. At this time, however, the merchant must be a U.S. business." [https://simplify.desk.com/customer/portal/articles/1173591-s...]

chiph2• 13 years ago

Looks like they don't handle recurring charges for you. So you'll have to be the one to hold onto the card number and jump through the PCI compliance hoops. Or go with a card vault service.

hmind• 13 years ago

Is it not this? https://www.simplify.com/commerce/docs/tutorial/index#recurr...

chiph2• 13 years ago

Whoops. Didn't see that. Thanks.

techboots• 13 years ago

So what's the consensus on this? I'm looking to integrate either Stripe or Simplify... which service do I go with?

nwenzel• 13 years ago

Stripe knows how to innovate. Simplify knows how to copy. Go with Stripe.

zanny• 13 years ago

Give me your bitcoin address and we can have a transfer in minutes for a few satoshis or within an hour or so for free.

(blahblahblah, usd, ponzie scheme, cbx halting transfers, grandmothers)

csdreamer72• 13 years ago

Are there any chargeback fees? (For those who don't know a fee in addition to the chargeback which is usually $25.)

NKCSS2• 13 years ago

See https://news.ycombinator.com/item?id=5955772

csdreamer72• 13 years ago

Thankyou!

kiyanforoughi• 13 years ago

2.85% fees? Such a rip-off.... Braintree is much better/cheaper and offers so much more.

LukeHoersten• 13 years ago

Their website design looks like a hardware store site design.

rdl• 13 years ago

Given that they permit weapons and pornography, if they're otherwise just a direct clone of Stripe with the MasterCard brand, they're pretty awesome. I'd be fine if it cost 3.5%, but it's actually cheaper too.

MasterCard's Simplify Commerce

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