Postcards from Europe: Case Study, Fastest Growing Top Ten!
Welcome to the content from our series "Postcards from Europe" that ran between the 14th - 19th of July 2014. On this page we showcase the top ten fastest growing start-ups in Europe. The data was collected from Deloitte Technology Fast 50 for Central Europe. Find out about our "Postcards" series HERE
#6 Webteh - Number six on our list of the top ten start-up in central Europe is money processing business Webteh from Croatia. The first thing that stands out about this business is its growth rate has exceeded 1100% and, like other start-ups in the finance sector, has found a niche providing simple, cost effective and in demand solutions. However, we are talking about demand from the consumer market we are talking about demand from merchants or mostly small to medium sized business.
The company has been developing and providing secured payment gateway solutions since 2003 and have since evolved into both direct and partnering models. By partnering models we mean with larger financial institutions that now allow them to offer full payment services. This growth and the provision of these types of services is recognition of the trend that has been emerging since early 2000 when it comes to payment occurring through secure gateways such as those provided by Webteh. In fact according to a study by WorldPay mobile commerce transactions are estimated to grow significantly from $18 billion worldwide in 2012 to $117 Billion by 2017. Further, mobile payments will make up 3% of the global ecommerce market by 2017.
Online transactions performed through e-wallets will rise from $294 billion in 2012 to $1.7 billion in 2017, according to WorldPay. According to the report, credit and debit cards will account for $1.7 billion worth of e-commerce payments in 2017, up from $979 billion in 2012. Payment cards' share of total global online payments will fall from 57 percent in 2012 to 41 percent in 2017, due to the rise of alternative payments via e-wallets such as PayPal.
Now, to be clear, while Webteh may only be providing a specific suite of products around payment gateways the reason we highlight the strength of mobile ecommerce is to show a business such as this can easily diversify into secondary (but connected) markets. In actual fact, if you were a start-up entrepreneur in a developing country in South America or even Africa then this is one business model to look at in terms of where to start.
The benefit of being a payment gateway as opposed to a traditional bank is you get to keep your overheads down thereby increasing profit margins.
The next big challenge for this Croatian business is where to from here!