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20VC: Scaling to a $1.3Bn Valuation While in Stealth, The Power of Different Network Effects Within Payment Platforms & How To Leverage Your Board and Investor Base for the Most Value with Matan Bar, Founder & CEO @ Melio

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Feb 11, 2021

Matan Bar, Co-founder and CEO of Melio, previously led product teams at PayPal and eBay. He shares insights on scaling Melio to a $1.3Bn valuation while in stealth mode. Matan discusses balancing transaction volume with revenue and the unique network effects that differentiate Melio. He reflects on the challenges of rapidly growing the team, ensuring cultural integrity, and implementing effective diversity strategies. Additionally, Matan emphasizes the importance of values in leadership and building trust during the transition to digital payments.

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ANECDOTE

Melio's Founding

Matan Bar was shocked to discover B2B payments were still paper-based after experiencing the digitization of consumer payments at PayPal.
This realization, sparked by a Federal Reserve study showing $18 trillion in paper check transactions, led him to found Melio.

INSIGHT

Key Aspects of Payment Systems

Ubiquity, the ability to be used by anyone anywhere, is crucial for payment systems. Choice in payment methods is also essential for user satisfaction.

INSIGHT

Growth over Revenue

For young companies like Melio, growth is prioritized over immediate revenue. Focus on growth expands the network and leverages the network effect inherent in payment systems.

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Matan Bar is the Co-Founder & CEO @ Melio, the company that provides the simplest way to pay vendors and contractors. To date, Matan has raised over $254M for Melio from the likes of Accel, Bessemer, Aleph, Coatue and General Catalyst to name a few. Prior to founding Melio, Matan Bar was Head of PayPal Consumer Product Center and before that was a Head of Product and GM @ eBay in their Israel Innovation Center.

In Today’s Episode You Will Learn:

1.) How Matan Bar made his way into the world of startups and came to found one of the fastest-growing companies today in the form of Melio?

2.) What is the single most important thing in a financial transaction business? How does Matan think about the balance between optimising for transaction volume vs revenue? What does Matan believe are the core network effects within payments businesses? Why do most opt for closed network effects? How is Melio different?

3.) What have been some of the biggest challenges of adding 170 people in one year? What breaks first? What needs to be in place to ensure the culture can scale with the headcount? How does Matan structure the leadership team to manage this hyper-growth? Has Matan struggled with self-doubt in his leadership during this hyper-growth?

4.) What specifically has Melio and Matan done to achieve a 49% female to male ratio within the company? What works when it comes to implementing diversity at scale? Where do so many people make mistakes? What specific strateies have allowed Melio to hire some of the best female engineers?

5.) How does Matan most like to interact with his board? How does he determine the advice to ingest vs the advice to reject? What have been some of his biggest lessons when it comes to successful board management? Where do many first time founders make mistakes when it comes to investor value add and extraction?

Item’s Mentioned In Today’s Episode

Matan’s Favourite Book: The Unbanking Of America: How the New Middle Class Survives

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