The Founder Behind A $1B Exit Gets SO Real: Suneera Madhani

0:00Hey, business besties. Welcome back to Female Founder World. I'm Jasmine. I'm Jasmine.

0:18I'm so excited to be here what a great conference yesterday oh thank you I mean wild like I feel like I need to sit and process everything that happened and you were such an amazing speaker we loved having you as the keynote thank you it was so fun I loved your audience I was like I don't know what do we call I called bullshit that was so fun it was I was hearing that I know I was like I had 20 minutes I was like what am I going to talk about it's like lessons to building a billion dollar business but I was like instead of the lessons I was like let's call the because those female founders, we like were told so many lies.

0:47I was like, let's call bullshit. And the audience like was just giving me all the energy. I love that. And that's why I wanted to talk to you because I've seen you speak on your own podcast, your own community about the very honest side of building a company and not just building a company, building a big company. You had a billion dollar exit. Yeah, I did. Wild. And then you thought, hey, I'm going to do this again. Oh my God. Did I, I did not want to do it again. I have a crazy brother who's incredible and he's like, let's do it again. No, but I think once an entrepreneur, you're always an entrepreneur.

1:17But it was, it was a wild ride. I started the company so young at the age of 25. I had no money in my bank account. I didn't go to CEO school. I didn't have a fancy degree or venture capital or the connections. And I happened to be in the payment space and saw like a very clear need for something that was different, but I had no desire to be an entrepreneur. So it happened and And I went for it. And then 10 years later, so it wasn't like an overnight success, but we took that idea from just that, you know, subscription and payments. It was zero to, you know, 40 billion in payments on our platform.

1:54So it was really, it was an incredible journey. And some other milestones there as well. You were doing 160 million in revenue. Yeah. In revenue. Yeah. When we exited. Yeah. So it wasn't like a fictitious, like here's this like, you know, blown in valuation. Like it was true revenue multiples. I raised, I didn't know how to raise venture capital. I was pregnant, fundraising, rent venture capital. Like the whole thing, the whole entrepreneurial journey was new to me. Also just being in the boys club and in the FinTech space, it was completely wild. But, you know, you know, here I am, like we did the thing and, you know, you put one foot in front of the other and you figured out you don't have to go to CEO school.

2:30That's why I'm so passionate about, you know, believing in yourself and women just truly building big businesses as well. I didn't know I could go build a million dollar business, let alone a billion dollar one. Yeah. And I wish I knew what was possible. And so I love to share my story and share stories of women building because I think it's so important for us as female founders to hear. I really want to focus this conversation on like how to think really big. Yeah. And we talked to founders with all different like aspirations and goals and backgrounds but like you have done something incredible and big and that most people will never do in their lives but so many want to and so I want to focus this conversation on like specifically like let's just think bigger and how did you do that I'm going to go through your origin story in a second but I want to like talk about something that you just mentioned which is um you know building a big business and how does somebody know that their opportunity in the space that they're building how is a is a billion dollar opportunity versus a million dollar opportunity so that they can just make the decision about where to focus their time.

3:30I think that if you're starting a business, you need to go ensure that your market space is a billion dollar opportunity. Whether you decide to make it, you know, a hundred million dollars or a 10 million dollars or one million dollars or a billion dollars, it is important for you to go get a large addressable market. I think that that is like, you know, there's so much opportunity. So I do think that your total, it's called your TAM, your TAM should be really large. Like, why not? Like, why not you? That can go do it. I think as women, we almost stop ourselves. And I love that this conversation is going to be about building big.

4:06My newsletter is actually called Big Business Energy. And I love talking about building big businesses. Like, why not you? Like, why are we shooting for just the million dollars or the seven figure or just the eight figure milestone? Like, uncap yourself. It is possible. It's possible for him. So why is it not possible for you? Yes. I love this. Let's go back to the early days of starting Stax Payments. Was it 2010? When did you start? I started in, yeah, 2013 was our official like kickoff of the company. I quit my job in 2013. And then six months later in 2014, I was registered with Visa MasterCard, which was like another, like, where do I go find Mr.

4:46Visa? I don't even know. I was young. And I will say like, if I look back, like there was a lot of things that had to go right. A lot of hustle, a lot of like all the work and the opportunities and then like putting myself forward and like taking action. But also I think there's like a little bit of like the karmic stars have to like just align. So I can't just like hard work is it, but you need a little bit of like something's going right. And we just happened to have things like we were just focused, relentless and like watching every little like move. And so we were like taking our shots and it was working.

5:19What was the opportunity that you saw back in the beginning? Yeah. So we launched the first subscription based credit card processing platform. So payments was it's very commoditized. And at the time, like Stripe and Square and others like weren't in the market. They were like building. They were there, but they had not a lot of traction. And there was a space where you needed. I don't want to get too technical on the show, but it was card present transactions. So like in-person payments, Square did a really great job. And then Stripe was solving for backend transactions. So card not present. So card present, card not present.

5:52And there was this like white space. I was like, who's solving for the dentist who needs to like take a transaction in person and then also send an invoice online. So nobody was tackling at that space for that piece of software. So we built that first API that did card present and card not present. And so we took over that space and it was really awesome technology. It was really innovative. And then our pricing model was really unique. And we were, instead of it being percentage-based, it was a flat monthly subscription. And then you were like capped at how much you could transact, but you could transact whatever your subscription allowed.

6:29And so it was really cost-saving for business owners. And so we had a better way. We had a more economical way and it was very transparent and like a better technology for that vertical and use case. And so we owned that market. We also were at a time in 2013 where in the financial ecosystem or like how payments were sold was directly through like your bank or you walked in to go get your like a payment terminal, like a physical device, or you signed up with like Bank of America or like your Chase like business credit or whatever it was. But we decided to go online almost like direct to consumer, but direct to the businesses.

7:09And so we saw an opportunity in the digital space in 2013 to cut out like all of the middlemen and just go find our customer directly online. And so that's how the company got started. And my background, I went to University of Florida. I had a degree in finance and marketing, but I did finance because I'm an overachiever, but I love marketing. And I was like, we need to go online. And I put my first like$500 in and like Google ads and like somebody called and the phone rang and I sold them like a product and I like it didn't even exist and I was like okay this is the way and I think yesterday I was sharing like you've got to throw spaghetti at the wall and you've got to be different and being different was our superpower at the time our company name was called fat merchant I'm like embarrassed to say it was FATT and it was like an acronym fast affordable transaction technology we've grown so much.

8:00We grew so much. I changed the name in 2020. But I mean, Fat Merchant was unique. It was different. We were like, that was a hundred million dollar company. It wasn't the billion dollar company, but we, we put, you know, we built it. We did it. We, our first year at the end of that year, we did 5 million in payments through like our ecosystem. I was literally driving my Volkswagen Beetle showing up to retailers being like, you need to use like our terminals instead of this one. And it was like white label technology. I'm not a software developer. Talk to me about that because like I can, I can understand as you're talking about, I can understand the, the marketing piece and the engine behind growing it.

8:42We're going to a hundred percent talk about that. But like, what I don't understand is you've got a finance background, you've got a marketing background. How the hell do you build a tech company in, in the financial industry, which is you cannot mess that up. You cannot mess it up. You find really smart co-founders. You cannot do it alone. And so I have two co-founders. My brother ended up coming on board very quickly. And him and I were definitely on the sales operate. He was on sales and operations product. And then I was on the marketing side and just getting like I knew I knew this industry because I was working for a payment processor, but we needed a technical co-founder.

9:21And so we went to a local tech accelerator and we're like, where's the, where are the technical people at? And so that's how I ended up meeting my partner, Jacques. And he had built, he was exiting his second company. And, you know, again, like a little bit of luck, a lot of convincing, and you start building a team, like building your core founding team is so important. And I think as women, we feel like we have to do it alone. We don't have to do it alone. And yeah, there's benefits of like doing it alone and making decisions in that way and having full ownership. But building big requires, there's like, it's so nice that I get to share that pressure with somebody else.

9:58Like you're going through the shit with me at the same time. Mentally, it's so helpful. Like just having a partner is so helpful. It's also challenging in its own ways. But if you can learn to figure out and play with where your strengths are and everybody stay in their lanes and like you can just go so fast. And so the three of us together are just like really unstoppable and like very, you know, unique in our expertise. And we we hit go and that, you know, from five million in payments five years later was five billion. And then another five years later, which was 10 years, we're at 40 billion in payment.

10:34Wow. And we owned like we owned professional services we owned retail health care like we own these verticals and we white labeled like we powered so many networks talk to me about so first of all like what is white labeling okay so white labeling and this is where um it's like where your brand so like your brand is not the visible one but other people are using your technology or your product and putting a label on your on your product. So we were powering a lot of really cool software. So, for example, what's one pet desk? It was like a it's it's not a co-working space for dogs. It was it was like a veterinarian software.

11:17Yeah. OK. So similar in that health care space, they had a software and they created the best operating software for all vets. instead of using Stripe was what they were using. They white labeled Stacks as a solution in their platform. They were getting RevShare. We customed a little bit of our software to fit PetDesk software. And then I was like PetDesk payments instead of Stripe. And so we became this really awesome white label backend engine so that people can have their brands forward, customized the payment flow against, and not for everyone, the verticals that we were serving. And so we could then go to PetDest.

11:56We can go to the next one. We can go to the next one. We can go. And so that's white labeling. And in 2017, so we were direct to businesses for so long. And then enterprise is really where we grew really fast. And what's cool about white labeling, it was one to many. So I could hit so much more from a partnership model than me acquiring one customer at a time, although we were very large, we were 40 ,000 small businesses that were direct with us. It was a really cool playbook. And I didn't know this playbook. Like I love to share. These are ways that we build big businesses. You don't have to do it alone.

12:31You could do it through partnership. You could do it through collaboration. Like imagine a world where, and as female founders, like we have, we are such collaborative creatures. Like why are we not leveraging that more. And that's something that I talk about so much at CEO school is like, how can we actually come together? There's enough to go around for all of us. I want to talk like a little bit more about white labeling and this strategy, because I think it is really interesting. It's like this way that you've been able to leverage the technology that you've built to get more out of it. One to many.

13:04Yeah. And every model has it. Yeah. OK. Talk to me about that then. Yeah. Every model has it, whether you are in consumer products, whether you're in service-based products. Like you can find a one-to-many model. So I'm thinking of one of our members. She has a yoga certification and she's a service-based. She like teaches yoga training and certifies like these really heavy, these instructors that, you know, are getting their second and the third like advanced degree. So she's been like the yogi expert for so long. Her name is Susanna Bacardi. I'm just going to give her a little shout out. She's one of our Millionaire Founders Club members.

13:41But her story comes to mind and I don't think she'd mind me sharing it. She was certifying yoga instructors and then she decided to go to the one to many. And then now she's, you know, working with corporations like Netflix and then doing their corporate wellness and still utilizing her expertise in that. But then how can she create and she's a trainer and facilitator utilizing that to white label one to many in corporate and like for corporate wellness. So although it's still a little bit different, not exactly the perfect white label scenario. But one to many is still it's just so different.

14:15And there's so many models like you can apply one to many from collaborations, partnerships like I can we can find that model in every one of the businesses. And I think as women, we go down market easy. So we're like ready to be like the and I was I was I was the most cost effective provider. That's the first thing that I did was we were the first like flat subscription. That's naturally where we go as women? Pricing. But why are we not going up market? Who are the enterprise customers that can also benefit? Because one large contract can then yield us so much more. So for my second FinTech, I'm actually not, I wanted to do, we're still going to do it, but we're building a business credit score now.

14:53It's called Worth. And that was a problem that came from my last business. We're just like, oh, it was like, what's the problem that you see? Go solve that problem. One of the problems after onboarding 40 ,000 businesses was that there is no credit worth way to understand a business's financial credit worth quickly. We have our personal credit score, but why is it tied to our personal credit score? Why can't business data be tied, financial data be tied to the business? So simple. But it doesn't exist. So we're like, OK, let's go solve for that. And I could solve for it one by one by deploying individual business credit scores.

15:28But instead, I'm like, let's go directly to all the banks. They have all the data. They have all the customers. So we're selling enterprise software to help them determine their small business's credit worth. So all the stacks of the world, all the banks and the financial institutions, all the fintechs. And so for this model, I'm like, let's go straight to enterprise first, and then I'll go to consumer or go to small business second because I'll gain traction so much faster. So it's a different way of thinking about business, but it was, I stumbled upon it a lot later in the first journey that I wish I knew separates.

16:01Hopefully that's helpful. I love that. I think that's so helpful. And something that you can apply for like to literally everything that you're doing. It's like, how can I leverage my time and this product and this skillset that I've created and get the most out of it? That's really what it's about. It is. It's called scalability. Yeah. Right. Scalability. And that even applies for it, you know, every product. Like even if you have, if you're a coach and you're doing like one-on-one is not going to scale. How do you do the one-to-many, right? Like your masterclasses, you're like, how do I reach the one-to-many?

16:30Everything has a one-to-many. Let's think about that first. I want to talk about those early years of Stax Payments. You started the business with like 50K or something, right? Yeah, nothing. Actually, even probably less than that. I was supposed to go get my MBA or I quit my job. And then it was like, okay, I have six months. And if I can get this off the ground, great. If not, I'll go get my MBA. And I clearly got it off the ground, but it was, it was not, I got off the ground, but it was, it was not easy. Like, I don't even know. Like I look back and it's like all a blur. And I think that one of my best things was like the naivete of being a first time founder.

17:05Like now I know everything that's like coming in front of me and I kind of wish I didn't. I love that you can just go try things and be comfortable and like taking risks and taking bets. And I think being young, I think one of the things you were telling me about your audience is, you know, where you're at and like in your age and take the risks now. Like you can take all the risk in your 20s, all the risk, because if you fail, you have the rest of your life to make up for it. Yeah. Like in your 30s, guys. In the 30s, too. Like you have so much like the time is on your side of risk taking as early as you can get it.

17:38So take risk and take you could take bigger risk. And I think that that's a beautiful thing. And so I love to swing. I think I I grew up with immigrant parents and my parents were entrepreneurial out of necessity. So they own like small businesses and convenience stores and they didn't get an opportunity to have an education because they immigrated to the country so young. And, uh, but they took risk. Like the biggest risk that you can take is like leaving your country to go like live somewhere else. And then solving for like, I just love the ability of like my parents to figure it out. And I'm so grateful that I got to grow up around that.

18:13And that's something that me and my husband are so mindful for in front of our daughters. Like I want them to take risks. I don't want them to get comfortable. I want them to fail. I want to celebrate failing and trying. And I grew up in a house like that. And so I do feel like I'm naturally wired to take risks. For my 17th birthday, my dad took me to Atlantic City and he taught me how to play blackjack like on the blackjack table. Like it's such a weird like our stories are so weird as a family, but I'm so grateful for them. But take risks. That's what's really important, especially at that early part of your entrepreneurial journey because then it becomes like you have to get a little bit more calculated because now you have customers or now you have investors like you can't do those things you have way more to lose so figure like do it in the early try the idea yeah like every every month like in our marketing budget i would put it wasn't much it was like two grand or three grand i would put like as like an experiential thing this is before like now we of social media that you could try so much cool stuff and it doesn't even matter if it like you could try the next thing like we would put money in our budget to be like go try something and like whatever the thing was I think it's so important for you to have some experiment and like have fun I came across the other day um someone on LinkedIn who I've been following now um and she works for um oh my god what's his name the what's the the CEO podcast guy Diary of the CEO she works oh yeah Stephen Barlett.

19:38Yes. And her title is the head of failure and experimentation. Oh, cool. I was like, that is such a cool title. Yeah. And like, what an intentional thing to like build into your business. Yeah. I think we should all be celebrating. Like failing means that we're trying something and then you're getting a debt. Sorry, I'll say that again. Failing means that you're trying something and then you're getting a data point. So then you actually like you have then you get to use that again to make the next part of it better. So if you accumulate like people are like how like you know what are the biggest lessons and like building the billion dollar company it's like honestly if you look at every successful founder on the other side that's exited they just never they didn't quit like they just kept like they they it didn't work and then they kept going and then they use the information that they had to like do it better to pivot to try the next thing and success is just accumulation of a series of a long time of that like that's what that is you talked about uh you know getting those enterprise clients but i want to know what some of the specific things that you did at um stacks payments like what were you doing to get those customers what was the marketing engine what was fueling the business at that time so you have to kind of be ahead from a market i'm a huge believer in go-to-market strategy and you have to be ahead like right now and it's changed so much so whatever strategy i'm going to give you at that time was um seo was like and now like now these things aren't relevant anymore But in 2013, we were like, who's writing about payment processing?

21:02Like payment processing wasn't sexy. We weren't, it wasn't like digital online. Businesses weren't searching for keywords on it. So we started to own this space on like, we were the first blog about like how to like use your terminal and how to like, how to read your credit card processing bill. And it wasn't had to do with like exactly our solution, but we were educating, providing value to our end customer about our like about our industry and so we were like that wasn't that was like a marketing opportunity for us that we saw early ads at that time like google was um an open like open engine a lot of the banks and etc they weren't spending dollars online to acquire customers there's like 43 million small businesses like that you can go target so we were looking at they weren't going to search for like credit card processor but like what were adjacent things that they were looking for.

21:55And so ads was a strategy of ours, which I don't recommend now. Like if I like I'm redoing in like second phase, like it's just not what like organic is. I wish I started an organic engine. We did have a great organic engine, which was like the SEO and the blogs, et cetera. But at that time, we were disruptive in our own marketing go to market. And so as you're thinking about your business today, like I believe like I mean, you have to have like social media is like par stake. So that's like the now par of like your SEO, your search terms, like all of this stuff that was 2013. Now that's social.

22:35But what are the ways that you can innovate and be like, oh, I see what's coming and I'm going to own that because you have wide open opportunity that maybe your competitor is not seeing and you can go after that. But what really helps also is when you're marketing to a niche or you're marketing to you know your customers so well that's so important because you can't market to everyone and I think a lot of founders in the early stage are like well my product can do this for this person my product and I serve women that's too broad yeah like are you serving women age 19 to 25 are they living in New York like what's their point of view on this thing like it's so um personal it is but that those are brands that win they know that customer and when you have that customer then you can go find the channels that she is viewing reviewing or where she's at and then we can expand of course we can expand our verticals like once you nail it but to get that initial that that one to ten million you got to go own that vertical really well what you were saying about seo before reminds me of canvas origin story because they i remember hearing something so when canva was starting they also had a kind of like seo strategy around it and they were um creating like uh just blog articles about the sizing for different social media posts so people would google like what is the rate like what are the dimensions aspect ratio for an instagram post yeah and canva would come up and then they would end up using canva and that's one of the things that they did to grow it's giving value yeah what is the you talked about now social media and content is kind of like the table stakes that maybe SEO used to be that.

24:16What do you think is next when you think about, okay, where is this marketing landscape going over the next five years or what things can we be experimenting in now? I think it depends on your vertical, but I do think that people are buying more and more from people. And so I don't know. I don't, I think that we know when we're being sold to. I think that we're becoming smarter as like consumers from an advertising lens, even influencer marketing is starting to shape different i think that user generated content and true like referral word amount like the best way i learn about products is through conversation or what my friend's using and through actually like um people that i admire and follow and if i see it on them and i'm like oh i see how she's using it not just like here buy this click this do this yes i think the story behind the brands i think those things have been important for quite sometimes in social.

25:08But I think that user level content, if that makes sense, and how brands can connect with actual users, not just like influencers who are going to sell the products. So I think that there's a big shift that's going to happen with how the younger generation is going to buy products. And I think capturing attention is really hard. I mean, products and services like now we're like so saturated, like there's a million, like everything that you can think of, there's like 30, 50 other companies that are doing exactly that. So how do you really stand out in that crowded space is by like being different.

25:40And so I do think you still have to be, I love building boldly and unapologetically, like all our brands have always been really, even in financial services are really boring brands. Stacks was sexy still, you know, We were like really innovative in our marketing and worth is, it's just so, it's just bold and it's fun. And CEO school, like I love building brands like that are unique and memorable. I think that that's still important. Now you're very like forward facing. You're, you've got a pretty big community on social, you have the podcast. Were you like that while you're building stacks or were you more behind the scenes?

26:23No, I was so like that. I've like always been like that. I was like, that's how I ended up like I, um, the capital raising, right. So how did I raise venture capital? I didn't have enough money. We, I started to get customers and I was showing up at pitch competition. So like my first take at like grabbing a stage at a coffee shop at like tech meetups, I was like, throw on a sticker. So I'd wear like my fat merchant t-shirt. I had these like stickers that I would like throw on everywhere I went, um, little fat merchant piggy and I'd like show up and you were like, I don't even need a mic. And I was like, let me tell you why this is going to be like the next thing in FinTech or in payments.

27:00And I got comfortable being so uncomfortable being like, people are like, what, like, what is she doing? Like I pitched everywhere. I was rejected more times that I can count. Like, and I was like, okay, like, I don't know why it didn't phase me. Like rejection phases me so much harder now as I'm older, but I don't know. I was like fearless when it came to like showing up to these things. And I took home my first business plan check. It was the National Association of Women Business Owners. It was a $20 ,000 check. And it was like one of those like big giant ones. And I just like knew in that moment, I was like, okay, this idea is like, I'm like, this needs like, we need to like press the gas.