The end of cash:
Jacob de Geer has arrived in Edinburgh with no money. Or at least no cash. Not even enough to buy a pint or get a bus.
In fact he’s not carried any cash for eight months. It’s not surprising, really. In his native Sweden cash is becoming a bit quaint. Many bars, buses and taxis refuse to accept it.
“It is happening all over the world. Younger people are now used to paying for things by card,” he says. “Less than 3% of all transactions in Sweden are by cash.”
In fact it is impossible to buy a ticket on the Stockholm metro with cash, retailers are legally entitled to refuse coins and notes, and street vendors – and even churches – increasingly prefer card or phone payments.
Cash transactions in the country are forecast to fall to a mere 0.5% by 2020. Nearly a thousand of Sweden’s 1,600 bank branches no longer keep cash on hand or take cash deposits – and many, especially in rural areas, no longer have ATMs.
Swedes use cards more than three times as often as the average European, making an average of 207 payments per card in 2015.
In this drive to becoming the world’s firs cashless society it’s not difficult to see a business opportunity. De Geer grabbed it and in 2010 launched a business “cashing in”, so to speak, on the trend towards electronic payments.
His business, iZettle, has grown rapidly to become a leader in merchant payment systems and for three years worked in partnership with Scottish firm IntelligentPoS, a business in the same point-of-sale sector developed by Robin Knox and Paul Walton. Last September Knox and Walton accepted an offer to sell their Leith-based business to their partner.
Since then the two companies have grown the client base and the payroll. They have just moved the UK head office into West Port, Edinburgh, where they plan to expand further. De Geer flew in from Stockholm to join the office launch party.
“We had worked alongside each other for some time and it made sense to join forces to boost the offering,” he says.
One of the drivers of the business is to bring the advantages of cashless payment systems enjoyed by big firms to the small traders. Its credit card-reading device can be attached to smartphones and tablet devices, allowing small businesses to process payments.
“My mission is to democratise card payments and give individuals and small businesses the possibility to accept card payments in a simple, affordable and secure way,” says De Geer.
“Customers want to order their coffees, walk in off the street and pick them up. Starbucks is now having to re-organise its outlets to handle this change and small traders are moving that way if they want to compete.”
The idea for iZettle came from his wife who was importing sunglasses and reading glasses to sell them at fairs and markets. She was missing out on a lot of sales due to not taking card payments.
“To help her out I did some research and found a solution to take card payments with a card reader and smartphone in the US.
“It became obvious that a large number of small and micro-businesses in Europe were simply falling through the cracks and unable to find an affordable solution to accept card payments. That’s how I first got the idea to create iZettle.”
Swedes are a “tech savvy” people who are keen to embrace new trends, gadgets and fashions. It’s not difficult to see how it has become a hot spot in electronic transactions, producing a string of global businesses like Spotify.
De Geer, a serial entrepreneur, is now regarded as one of the stars of Europe’s tech sector and after a number of funding rounds iZettle was valued in January at £400 million.
The cash and equity acquisition of IntelligentPoS has been followed by the move to West Port where it will employ 80 staff and build a broader footprint.
There was an immediate result soon after the deal when a sales and marketing base was set up in Germany to reach an estimated four million small and medium-sized businesses.
“Our objective is to create a global company,” says De Geer. “We are in ten markets in Europe and have added Mexico and Brazil. We think IntelligentPoS will help us grow more quickly.”
Education: Stockholm School of Economics
Career: Started first business in 1999 which was listed in 2005. He was the first employee at performance marketing firm TradeDoubler where he played a major part in building one of the largest advertising networks in Europe. After leaving TradeDoubler in 2007, he co-founded two companies: Ameibo, a “legal” movie sharing company of which; and Tre Kronor Media, an award-winning communications agency. Both companies were acquired in 2010. Launched iZettle the same year.
What he says about himself
“I have never had a proper job”
What others say
“He seems like a focused entrepreneur, and someone who has the ability to have an idea and bring it home.” – Prof Niklas Arvidsson of Sweden’s Royal Institute of Technology