Originally from YoungEntrepreneur.com. View original article here.
For some people, entrepreneurship is a necessity for survival. For others, it’s an opportunity.
Jared Isaacman
knew in his teens that he wanted to launch a business. In fact, he was
in such a hurry to get started that he took the General Educational
Development, or GED, exam and left school at 16. Six months later, after
a stint at a credit-card processing company, he launched his own
business in the same industry, United Bank Card Inc.
At 30,
Isaacman continues to lead the company he started from his parents’
basement in New Jersey. Except today, it’s a bit bigger. United Bank
Card, which is based in Allentown, Pa., now goes by the name Harbortouch
and processes nearly $12 billion in payments annually for more than
100,000 U.S. merchants.
Isaacman also
started a second company called Draken International out of Lakeland,
Fla. That aviation company consists of what he calls the world’s largest
air force, with more than 50 jet fighters, and offers simulated threats
for training exercises for one of its clients, the U.S. Department of
Defense. Isaacman developed an affinity for aircraft early on and
trained to be a jet pilot, an acrobatic flyer and certified flight
instructor.
He also broke a speed record for flying around the world in a light jet while raising funds for the Make-A-Wish Foundation in 2009.
While few
people know as clearly what they want to do with their lives as
Isaacman, but his experience — from an ambitious teen to high-flying CEO
— may provide insight and inspiration for other young entrepreneurs.
“It all starts with opportunity,” he says. “You can have the smartest
person that works tirelessly day and night on a business venture but if
there’s no opportunity behind it, it’s going to be a pretty big, uphill
battle.”
You may wonder
how a teenager even got to the point of finding his opportunity in such
a close-knit industry as business-to-business credit card processing?
Here’s how it went for Isaacman.
After leaving
school at 16 with that GED, Isaacman went to work for a credit card
processing company called MSI Merchant Services Inc.
“They were and
remain a great company. I learned quite a bit from their management
team and principally Mario Parisi. He is one of the partners at the
company and has been a great friend and mentor. In fact, Mario Parisi
and my father are probably the two most inspirational figures when it
comes to my growth as a company leader,” Isaacman says.
Despite his
admiration for Parisi, he paid attention. After all, Isaacman was
looking for his chance to start up. After a short stint at the company,
it hit him: Credit card processing companies were missing out on a key
revenue driver, as he saw it.
Credit card
processing consists of two sides: card issuing, a massive business that
the major banks dominate, and card acquiring, which involves enabling
businesses to accept customers’ credit cards, Isaacman says. When he
started United Bank Card/Harbortouch in 1999, the card acquiring
business was considered a backwater of the business. “It was a necessary
but undesirable component of credit card processing,” he says.
Banks were
mostly interested in further developing their card issuing business, so
the card-acquiring end of the business was receiving little to no
attention in the form of technological or operational improvements,
Isaacman adds.
“The companies
that handled card-acquiring services were outsourcing like crazy, there
was no personal service for the business owners and the paperwork
process to begin the service was tantamount to signing up for a
mortgage. It was a neglected market with all the focus on issuing more
credit cards,” Isaacman says.
So, when
Isaacman left MSI to start United Bank Card out of his parents’
basement, that’s what he would focus on disrupting. Seeing the
potential, Isaacman’s father and Brendan Lauber, who is now the
company’s chief technology officer, joined the business within a few
months.
“We brought the entire process in-house, literally,” says Isaacman.
He handled the sales, account underwriting, risk management, deployment
and all of the customer service and technical support. “The result was a
small basement startup that was faster, more efficient and provided
better service than the larger players that were ignoring the potential
of the credit card processing industry,” he explains.
And not
wanting to lay fallow for long, just about two years ago, Harbortouch
introduced yet another new feature that Isaacman believes has
transformed the company. He launched a free, integrated, touch-screen
point-of-sale system. Other companies may charge $10,000 for a POS
system, according to Isaacman, who compares the free-equipment deal to
mobile phone contracts that offer free or low-cost phones when customers
sign up for service.
“It
has been a very successful strategy,” he says. “In our 14 years in
business we have never launched a program that changed the face and
direction of the company more significantly than our free POS
initiative.”
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