Our Director of Product – Payments & Partners Markus Brunke tells it all in our interview: how it all started with the Frisbii payment gateway, what the secret is to a successful roadmap and why pricing is a complex topic.
Can you introduce yourself and tell us what you do in one sentence?
Markus: My name is Markus Brunke and I’m Director of Product – Payments & Partners at Frisbii. I am responsible for the payment product and making sure that we take the product in the right direction and keep new and existing merchants happy.
The beginnings of a subscription and payment platform #
You were there since the beginning of the payment gateway. Can you maybe give us a rough overview of how it all started?
Markus: The initial platform idea was to create a subscription management platform. At that point in time, which was almost 10 years ago, there weren’t really any established subscription management platforms on the market.
Merchants had to build their own solutions and workflows for these things. That’s why we decided to build a subscription management platform. And after a few years, we realized that merchants also expected us to handle payments. Because you can’t sell subscriptions without payments.
Back then, we supported external payment gateways, but we saw the opportunity to become a payment gateway ourselves. Since I and some other people came from the payments industry, we knew what we were doing. And that’s how it all started.
Was it a big project to add the payment gateway?
Markus: We were fortunate because we had the payment gateway experience, so we didn’t need to hire experts. But it took some time to get to the first version.
And I remember we had a payment gateway, but we were only supporting credit cards, no other payment methods. Compared to our competition which had been on the market for 10 to 20 years at that point, we lagged behind. We had the right technology, microservices, API first but we didn’t have payment method variety, and we didn’t offer any cool features.
For a long time, we were just trying to keep up. I can remember that we were frustrated because instead of building cool stuff, we had to add these payment methods and just make sure we were on par with the competition. It took a couple of years until we could build more interesting features that the competition didn’t have.
The secret to a successful SaaS platform #
In an interview with the co-founder of Waitly, he mentioned that they very early on decided to do a modular structure for their platform to be more flexible. Do you remember a decision early on that paid off in the long run?
Markus: I think we can relate a lot because we have had the same approach. Our main priority the entire time was building features that benefit the majority of the customer base.
We made it a rule to never do anything custom and always build proper products which can be sold to other merchants.
Sometimes we would be getting a request from a big merchant and what they were asking for was important to them but not a good fit for the platform. But often, we could take that request and change it slightly, so it would fit and be useful for other merchants as well.
I think, that was a really good decision and we’re still operating that way.
What’s the biggest learning you had in those early years?
Markus: I think the biggest learning in the early years was that we shouldn’t be afraid to be a small company reaching out to big merchants.
We went from having maybe a couple of hundred small subscription merchants to signing some of the biggest companies in Denmark and even Scandinavia because we went with it and knew what we were talking about. People were listening to us because we knew a lot about the industry and we knew everything about the platform. That elicited trust. That trust, our experience and the modern platform won us enterprise businesses.
We went from having only small merchants to supporting 70% of all big businesses in Copenhagen and many others in Denmark and Scandinavia.
To summarize: don’t be afraid if you are a small company, just go with it. Try to do your best, take the meetings and be consistent. There will always be a lot of ‘No’s but at some point, you will get through the door and there will be a lot of possibilities waiting for you.
Cultural differences in the European subscription market #
What’s the biggest difference between the Danish market and the rest of Europe?
Markus: The Danish market is very unique in the way that it’s very modern in terms of technology and how people use it. Everyone is aware that you need to have a payment gateway if you want to accept online payments and that it needs to be a sleek and efficient solution. And Scandinavia is also quite forward-thinking when it comes to the kind of payment methods people use.
We’ve been surprised by some of the payment methods we’ve integrated to fit other markets in Europe because are a bit more traditional and still very popular. And I think it’s less the merchants but often the consumers who are simply used to pay with certain methods. It’s very much a cultural thing.
I also noticed that Danish subscriptions are much more diverse and include more paid memberships. In Germany, for example, most customers expect a retail membership to be free.
Markus: I think it makes sense because if you are more technologically oriented, you also know more options and tools that are available to you and your business. You will think about new business cases tied to these technologies. If you’re from a country with more traditional payment and customer relationship standards, you don’t see as many options in front of you.
But that is changing across Europe which is great to see. For example, I love seeing retail merchants changing their business models and trying out other revenue streams with subscriptions.
And these options and different revenue streams help to be flexible. I remember that during COVID companies who were able to switch their core business to more digital or subscription-based services had a big advantage because they could adapt to the shift in consumer behavior.
Markus: Yeah, exactly. And even for your daily business, it helps to be flexible.
Because in many cases, especially in retail, you’re selling the same product as your competition. The only difference is that you can ship it faster or have better prices or your website looks better. But there is only so much you can do if you compete over the same customer base. And that’s where you need to think outside of the box and find new ways to gain and keep customers.
Building a subscription model or another new revenue stream that makes your product more interesting compared to your competition can help with your growth and even open up new markets.
Customer communication is crucial for a product roadmap #
Back to you: How important is the exchange with the customers when it comes to your job and your role?
Markus: Very important. I’ve been talking a lot to merchants of all sizes and across industries. And if you’re working in the product team, you need to be in communication with your customers to learn what they need. Because you might think you know what they want but, in the end, only they can tell you that.
I think we have an advantage over the competition in the way Frisbii works, and how close we are to our customers. A lot of other companies basically put their product teams into silos without any customer contact.
At Frisbii, we try to be more holistic with our customer communication, to include sales, support and product, so we get input from our customers regarding our products, and our customers receive the relevant information from the right source to make the right decision.
How important is pricing for you and in your position?
Markus: We have worked a lot on the pricing of our product in the last seven years. And we also learned that starting off too cheap is not a good idea (laughs). It’s a complex topic because it needs to be so many different things: flexible, easy to understand and easy to sell, so our sales team can properly explain our pricing.
Especially as a payment gateway, it’s actually not that easy because the pricing always depends on the payment methods our merchants pick. Each and every single one has their own different price points, so an offer or a quote can be overwhelming for customers.
We need to understand those price points and how they come together and be able to explain how it works. Because if we can’t explain it to our customers, then they will get confused by the different rates and fees for payment methods but also additional extra services. I’m speaking on behalf of merchants who have told us that at a certain point, they don’t know what they are going to be charged and that makes their planning impossible.
And if I am being honest, we’re still working on a perfect pricing model that works for us and our merchants. I actually think it’s one of those things that are never perfect, there is always room for improvement.
How heated do these subscription plan and pricing discussions get?
Markus: At least here at Frisbii, I can’t remember any big arguments about pricing.
It was different at a previous company I worked at. Some people thought we should remove the pricing altogether from the website and that got very heated because I am of the opinion that a website without pricing immediately tells the customer that it’s going to be too expensive (laughs).
So, my philosophy here at Frisbii is to be as transparent about our pricing as is possible.
How close do you watch the competition?
Markus: As close as I can get and as close as it makes sense. You never know what the competition is building until they release something. So, if you watch the competition to set your roadmap, you will always be a step behind. I follow what they do and get inspired by it. And sometimes I see a feature I realize is important. But the competition is never dictating my roadmap.
You need to trust in doing something different and you can’t just mimic others all the time. If you have your own strategy and build what you think makes sense for your customers, you’re much better off.
Competition, trends, USPs and pizza #
When looking at the payments and subscription markets, what is the biggest trend for you right now?
Markus: We already talked about it, actually. Non-recurring businesses that try out recurring revenue streams. I think that is one of the biggest trends and changes we will see. Because once you have recurring revenue, it’s so much easier to predict revenue, to have better data and be more in control. And it means that you will have to add services for new and existing customers which also means that you increase customer loyalty.
What do you think is the biggest USP of Frisbii?
Markus: The biggest USP in Frisbii is that you can get a combined subscription, billing and payment platform in Europe with only us, like European departments, European employees, people that know about Europe.
There’s not a lot of alternatives for such an all-in-one platform when you want something inside of Europe.
Last question. Pineapple on pizza, yes or no?
Markus: No thanks. I have a pepperoni pizza tattooed on my arm.
So, no pineapple pizza on the other arm?
Markus: (laughs) No.
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