FTVentures Closes $512 Million Fund

Press Release from FTVentures

FTVentures announced on April 16th, the closing of its third and largest fund to date, FTV III, at $512 million. FTVentures will continue its strategy of investing in software and business services companies that derive value from the firm’s unmatched Global Partner Network, which includes the world’s leading financial institutions. Founded in 1998, FTVentures has over $1 billion in committed capital and has offices in San Francisco and New York.

“We greatly appreciate the continued support of our core strategic limited partners,” said Richard Garman, FTVentures Managing Partner. “We are also delighted to have new, highly respected institutions acknowledge our track record and unique model by joining our institutional limited partner group. The addition of traditional investors and new strategic investors to our existing investor network will allow us to continue to deploy our proven model with more diversified sources of capital.”

Consistent with the investment strategy of its previous funds, FTV III will typically invest $10 million to $60 million in software and services companies seeking to finance organic expansion, recapitalizations, build-ups, and buyouts.

The firm’s portfolio companies target the financial services industry as a key customer vertical and leverage FTVentures extensive Global Partner Network in developing commercial relationships.

New limited partners from the financial services industry include Liberty Mutual, Skandia Insurance, Nordea, PartnerRe, Capital One, Fannie Mae and Barclays Global Investors. New traditional limited partners include New York City Retirement Systems, RHM Group, New York State Common Retirement Fund and Kamehameha Schools.

FTVentures is known for the strength of its financial services industry network which includes the following limited partner institutions from the financial industry: AIG, AXA, Bank of America, Barclays Global Investors, BNP Paribas, Capital One, Charles Schwab, CIBC, Citigroup, Comerica, Credit Suisse, DBS, Deutsche Bank, Fannie Mae, Fidelity National Financial, Fifth Third Bank, First Republic Bank, Freddie Mac, GE Capital, Goldman Sachs Asset Management, The Hartford, HSBC, ING, JPMorgan Chase, KeyCorp, Lehman Brothers, Liberty Mutual, Lloyds TSB, Morningstar, National City, Nomura, Nordea, PartnerRe, People’s United Bank, PNC Bank, RBC Royal Bank, Sallie Mae, SEB, Skandia Insurance, Standard Chartered, Travelers, SunTrust, SVB Financial Group, USBancorp, Visa, Wachovia, Washington Mutual, Wells Fargo and Zions Bancorporation.

FTVentures previous successes include Actimize (acquired by NICE Systems), Corillian (IPO/acquired by Checkfree), ExlService (NASDAQ: EXLS), KVS (acquired by VERITAS), PowerShares Capital Management (acquired by AMVESCAP), and Verus (acquired by The Sage Group).

Current FTVentures portfolio companies include Aveksa, Cloudmark, Coremetrics, Covario, Financial Engines, GigaSpaces, GMI, Managed Objects, Rezolve Group, Capital H Group, CMS Holdings Group, Daylight Forensic & Advisory, ETF Securities, Freeborders, Intrepid Learning Solutions, Mavent, MedSynergies, Presidio Reinsurance Group, and ProfitLine.

The FTVentures partners are: Brad Bernstein, Eric Byunn, Ben Cukier, Richard Garman, Jim Hale, David Haynes, Bob Huret, Derek Lemke-von Ammon and Chris Winship.

Contacts
FTVentures
Karen Derr Gilbert, 415-229-3000
kgilbert@ftventures.com
www.ftventures.com

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Posted by John B. Frank Sunday, April 20, 2008 0 comments

HomeATM Payments News Headlines Ending 4/18


Brought to you via Glenbrook's "Payment News" Website, which was responsible for the compilation and posting of the following links. Clicking on any of the links below will bring you to www.paymentsnews.com where you can read the story in full.

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Posted by John B. Frank Friday, April 18, 2008 0 comments

Online Debit Growth Expected to Climb to $93.9 Billion by 2012 - Javelin

As the illustration on the left graphically depicts, PIN Debit is most secure form of debit and HomeATM has positioned itself as a prominent force as online debit is set to skyrocket on the web. The following is from Javelin Strategy and Research...

Alternative payments will account for an increasing percentage of U.S. online transactions by 2012, according to a recent study from Javelin Strategy and Research.

As I reported last week, Debit card online transaction volume will increase to $93.9 billion by 2012, up from $38.8 billion in 2007, accounting for about 26% of total U.S. online transactions, Javelin says. Online debit volume is expected to grow at a compound annual growth rate of 19.3% through 2012.

(Click the illustration to the right to enlarge it, then hit backspace to return)

The growth in online use of debit cards is primarily attributable to the growth in debit card usage in general, although younger consumers are opting for debit cards as a primary online payment option, Javelin says. The emergence of rewards programs linked to signature debit may contribute to growth, according to the study.

Javelin also estimates that online volume from e-mail payment accounts, such as PayPal, will increase to $40 billion by 2012, up from $7.8 billion in 2007, and will represent 11% of total online transaction volume. E-mail account volume, dominated by PayPal, will have a compound annual growth rate of 38% through 2012. Javelin forecasts that the average PayPal transaction at a retail site will reach $40 in 2012, up from $32 in 2007.

Stored-value products—merchant-specific gift cards and network-branded products—will grow at a 43% compound annual growth rate to $32.1 billion in 2012 from $5.4 billion in 2007, Javelin estimates. Stored-value cards will account for about 9% of total U.S. online volume by 2012, propelled by increased growth in multi-channel usage of in-store programs.

In addition, online private label payment card transactions are expected to total $23.7 billion by 2012, up from $5.3 billion in 2007, representing 7% of total online U.S. transaction volume, Javelin says. Private-label transactions will grow at a compound annual growth rate of 35% through 2012.

Editor's Note: If ATMDirect is going to "Own Online PIN Debit" as they mentioned in their "patently absurd" press release, I'd suggest they take little baby steps, the first one being "Acceptance of HomeATM's invitation for a "PIN-OFF" As of right now, they have 27 Days:6 hours and some minutes left to accept. ATMDirect...we're still waiting!

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Posted by John B. Frank Thursday, April 17, 2008 0 comments

HomeATM Still Waiting To Hear From ATMDirect Regarding "PIN-Off"

In the wake of the Airlines Industry having just become aware that a credit card processor can (and will) dictate that 100% of an airlines credit card based revenue can be withheld, it has become more than obvious that Internet PIN Debit will not only "fly" but will become "air apparent" to the current web transaction space. HATM is more than ready to "earn it's wings".

I am aware how both ATMDirect and HomeATM's Internet PIN Debit solutions work. As a founding member of Pay By Touch, from which Acculink procured ATMDirect, I am privy to specific details driving ATMDirect's solution.

After seeing and learning more about HomeATM's Internet PIN Debit Solution, I am convinced that HomeATM's technology is the strongest of these two.

I am interested in bringing more publicity and thus awareness to PIN Based Internet Transactions. For that reason, when HomeATM, last week, suggested challenging ATMDirect to an industry sponsored showdown which was dubbed by Ken Mages, HomeATM's CEO and Founder, as a "PIN-OFF," I thought it was a brilliant way to drum up some exposure towards furthering the cause of PIN Debit for the Internet.

Of course, it also occurred to me that this was analagous to an old-fashioned duel, ala the Old Wild West...and not unlike the Wild West, this duel may leave only one man (technology) standing.

According to Ken Mages, CEO and Founder of HomeATM, HATM is entirely more than willing to have this so-called "PIN Off" supervised by a knowledgeable, non-partisan entity(ies).

As I mentioned in last weeks blog posting, entitled "HomeATM Officially Challenges ATMDirect to a "PIN-Off," one suggestion (among many) as a "fair and balanced" technological judge/arbitrator was John Stewart" the Editor in Chief of Digital Transactions Magazine. With that said, HomeATM would welcome any and all highly respected industry veteran(s).

Strong candidates might include highly regarded Gartner Research analyst Avivah Litan, Aite Research Director and Analyst, Gwenn Bézard, Glenbrook's Payments News Editor Scott Loftesness, The GreenSheet's President and Founder, Paul Green and/or Internet Retailer Magainzes Publisher, Jack Love.

However, HomeATM is willing to invite any and all analysts to form an "Internet PIN Debit Payments Panel." and oversee the "PIN-Off"

As I see it, the panel's primary function would be to subject both HomeATM's and ATMDirect's methodologies to whatever rigorous tests they may wish to institute to verify how it works, that it works, how secure it is and how quickly the transaction is transacted.

Of course, all I'd ask is that results of these tests be shared (publicly) including each "analysts independent findings" upon the conclusion of conducting these "objectively unbiased analysis".

Say again? Okay. HomeATM is willing to showcase the HomeATM technology to a professional unbiased payments panel...and ATMDirect would be and hereby "is invited" ...to do the same. The results of the evaluation will be public domain.

Will you, ATMDirect accept PIN Debit ? As I posed last week, I think the real question is: Can ATMDirect accept,? If so, will ATMDirect be able to do so "securely" without any glitches? That is the gist of the challenge. My personal belief is the PIN-Off" might be too "Rocky" a road for them to travel. My educated guess is they may want to avoid having their technology subjected to independent analysis as it may die from exposure.

However, I've been known to be wrong before, so...ATMDirect, prove me wrong! If you don't think that HomeATM would "PIN U" into the proverbial corner, feel free to accept the invitation to an offical PIN Off by emailing me at: ATMDirect Hereby Accepts.

We would love (and are anxiously waiting) to hear from you ATMDirect...just accept the challenge sometime within the next 30 days. and we'll make arrangements for the PIN-Off. As a friendly reminder look for the "PIN-Off" Countdown Widget at the top right of this blog!

And every day for the next 30 days, I will let you know if I've yet to hear from or receive an acceptance of the invite to a "PIN Off" from ATMDirect.

You said in your "Press Release" that you will "Own PIN Debit on the Internet," so let's at least see you "Own Up to This Challenge".

I'll be waiting...

External Links to this Post:
www.allpaynews.com
http://www.huliq.com/


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Posted by John B. Frank Monday, April 14, 2008 0 comments

Mayday! Mayday! Mayday!

Yesterday I mentioned that card processor First Data told Frontier they would withhold 100% of their credit card processing fees... starting, May 1st, which ironically is also known as May Day! (Venez m'aider for my Canadian friends!)

The airline industry should see this movement as not only the distress signal that it is, but also a sign of things to come if they don't prepare a plan that protects them from being held, dare I use the word?, "hostage" by credit card processors.

One such plan would include further instituting and utilizing HomeATM's PIN Debit Platform which would eliminate reserves in their entirety and lower their card processing costs significantly.

Today I bring you an article from the Denver Post. Should you desire to do so, click this link which will bring you to thei DP's site where you can read related articles, including comments from readers about this very interesting and "still developing" fiasco.

Here's the story...

Frontier Airlines pointed the finger of blame directly at First Data Corp. for its bankruptcy filing Friday. Greenwood Village-based First Data responded with regrets that "economic conditions" forced the Denver-based airline into reorganization, but otherwise kept quiet.

So how did the two hometown corporations get into a stand-off that will have to be settled in bankruptcy court? Credit-card processors like First Data will ask merchants for more collateral to protect themselves when financial conditions deteriorate. Those same financial stresses, however, make a merchant less able to meet those demands — what some observers call a formula for ankruptcy.

'It happens regularly, particularly with the small and low cost carriers who have so much of their revenues tied up in credit-card transactions to begin with," said Jack Williams, a resident scholar at the American Bankruptcy Institute

Demands from credit-card processors are often the untold story behind many bankruptcies, Williams said, which makes Frontier's public outing of a company it needs to survive so unusual.

When consumers make a credit-card purchase, they have a guarantee from Visa and MasterCard to cover things like defective goods or undelivered services. Merchants get paid quickly even if the actual delivery takes place months later — say an airline or cruise ticket purchased in April for a trip in August. Although Visa and MasterCard offer the guarantees, credit-card processors are on the hook if merchants can't make good. Potential losses can be several times beyond any profits generated.

To protect themselves, credit-card processors require merchants to maintain a reserve, usually funded by holding back a certain percentage of the credit-card receipts they collect. "They are underwriting the risk. They are the ones who will be stuck if the merchant goes down," said Adil Moussa, an analyst with Aite Group, a Boston research firm.

Frontier maintained a $54.5 million credit-card deposit with First Data and one of $18.5 million with American Express, according to the company's bankruptcy filing. Frontier got news in letter Frontier reported that First Data sent it a letter Tuesday lifting the reserve requirement to $130 million. Until Frontier met that higher cap, First Data said it would hold back half of the company's credit-card revenues.

That First Data requires reserves is standard industry practice, and it's also standard to raise them when risks increase, said Jim Daly, a senior editor with Digital Transactions, an industry trade publication.

But lifting reserve requirements sends a loud distress signal to the market. "A 50 percent holdback signals all creditors that it is a serious financial situation and you have an impending bankruptcy," Williams said.

Unable to survive on half rations of cash flow for any length of time, Frontier sought bankruptcy protection. While holdbacks can trigger a bankruptcy filing, they aren't the "cause."
But Moussa questions whether First Data could have handled things differently. "One can't help but wonder if First Data is overreacting and really pushing one of its customers toward bankruptcy," Moussa said. And what happens if all credit-card processors respond to a rash of four airline failures by raising reserve requirements on all carriers, he asks. "It might just be the nail on the coffin for the already ailing industry," he said.

First Data faces pressures of its own. Kohlberg Kravis Roberts & Co. acquired the once public company in a leveraged buyout last fall, lifting the debt on its balance sheet from $2.5 billion to more than $22 billion. For 2007, First Data recently reported revenues of $8.1 billion and a loss of $907 million. That compares with revenues of $7.1 billion and a net income of $1.5 billion in 2006.

How First Data deals with merchants is somewhat mechanical, not unlike bank debt covenants, and entirely contractual. But Williams wonders if the entire credit crunch hasn't made all financial players much more fearful, a little quicker to pull the trigger when things turn south.

Despite any public posturing, Frontier and First Data are expected to reach a compromise as quickly as possible and their lawyers are reportedly already talking. The bankruptcy filing also blocks First Data's plans to hold back credit-card revenues. "It is to everyone's benefit to work this out quickly. I'm talking days. It won't go weeks or months," Williams said.

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Posted by John B. Frank Sunday, April 13, 2008 0 comments

HomeATM Blog "Week in Review"

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Posted by John B. Frank Saturday, April 12, 2008 0 comments

Airlines Can Have 100% of Their Credit Card Transactions Withheld!

The credit card processor cited in Frontier Airlines' decision to file for Chapter 11 bankruptcy, on Friday issued a statement defending its actions. "We regret that the current economic conditions have led to today's bankruptcy filing by Frontier Airlines," Greenwood Village-based First Data said in the statement.

First Data informed Frontier that it would withhold 100 percent of the Denver-based carrier's credit card transactions beginning May 1, said Joe Hodas, spokesman for Frontier. "There was no advance warning," Hodas said. "This has all transpired in the last three days.

Previously, First Data held back 45 percent of the low-cost carriers credit card sales receipts.

The feeling is that Chapter 11 is going allow us the ability to straighten out these financial issues under the protection of the bankruptcy court so that we can emerge a stronger and more long-term viable airline." But First Data downplayed its role in the situation. "First Data, with our bank partners, processes transactions for a variety of businesses around the world," First Data officials said in a statement. "We continually monitor and manage the credit risks associated with processing transactions in industries where we provide services.

Editor's Note: Here's the scary part for the Airline Industry. Withholding 100% of credit card transaction revenue is apparently considered "standard practice".
The terms of our agreement with Frontier Airlines are not unique; they are considered standard industry practice and terms originally agreed upon by Frontier.
Frontier Airlines is the second-largest airline operating out of Denver International Airport. In 2007, Frontier carried roughly 22.7 percent of passenger enplanements at DIA. The airline will continue operating as it works through Chapter 11, a fact that pleases DIA officials.

"We are pleased that Frontier expects to continue normal operations and will provide full flight schedules for its passengers at Denver International Airport," said DIA's new aviation manager, Kim Day. "Based on conversations I've had with Frontier, I anticipate no immediate impact to the airport's revenues or financial position. Frontier Airlines is our hometown carrier, and it has been a valued partner at DIA since the airport opened. We have full confidence in Frontier's leadership, and we believe it will emerge from this restructuring process in a strong financial position and will remain one of Denver's premier businesses."

Frontier Airlines currently owes DIA $1.7 million, due on April 20. DIA owes Frontier $7 million in net revenue credit and $3.74 in fuel tax credit.

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Posted by John B. Frank 0 comments

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