Innovative startup Fourex Pounds
the Pavement as Market-Disrupters
Our chat with FourEx, the UK based money exchange specialists taught us about the foreign exchange kiosks that exchange spare coins and notes for cash. As Bruno Mars once said, “Money, Money, Money makes her smile”….
We love to hear the underlying inspiration for new and creative startups. Can you tell us a little about how you spotted the opportunity for a service like FourEx?
It was such an obvious opportunity for us, simply because it affects almost everybody. The world is so connected because travel has become so accessible to so many people. The idea behind the concept is actually so simple, and by mixing phenomenal technology with a bit of common sense, we have created a whole new market in the exchange of redundant currency. The big companies have put so many rules and restrictions in place that tell us what we can and cannot exchange, so it was obvious that if this was going to work, it would have to be approached from a customer’s point of view. It was important that we gave the customer the best deal, and tried to solve the whole problem. We want our customers to love us, and that was how we designed the machine. It had to work regardless of what currency was inside the cookie jar, and regardless of what country you were using the machine in. Our big break came when we managed to secure the contract with Transport for London to place the machines into several London Underground stations, giving us the opportunity to offer our service to millions of people every day.
What would you consider to be your first office (home, coffee shop, library, etc.) and what were some of the struggles that space presented from a business perspective?
Oliver and I worked out of a single one roomed office for the first two years. However, one of the biggest struggles we faced was collecting the database of both the coins and notes. We have had to collect over 100 of each and every coin in circulation, so as to include them into our database. We did this both by travelling to coin dealers around the world, or checking Facebook to see when a friend was visiting somewhere exotic. They would then be asked to collect several hundred Pounds of coins. Most people have been amazingly helpful, but I am sure there are a few that don’t post their holiday pics on the public arena any more…..It also involved stacks of travelling for both of us, and in 2014 we must have flown in excess of 200 times in the space of a year.
How did you overcome these struggles?
We had friends in the airline business who were able to get us cheap rebate tickets. What this means is that the flight is a fraction of the normal cost, however you go on standby, and if there is a spare seat, you get on. If not, you can try again on the next flight. Needless to say we have spent many a night in various airports around the world.
One component of FourEx is a technology that allows your machines to recognize and process various currencies quickly. What were some of the challenges you faced when pursuing this technology? For example, did it even exist, or did you have to go out and build it first?
We had to start from scratch because standard coin identification systems work off the metallic make up of a coin, and this is fairly straightforward whn you only have to look for 6 or 7 coins from a single country. Our problem was slightly different because we had to consider over 150 countries, representing over 100,000 different coins in circulation, which meant completely starting from scratch. We soon realized that the only way to do this was through image recognition, and by combining that technology with various other factors that are unique to that coin, we are able to accurately identify one coin, out of a possible 100,000. The next challenge was to do this at lightning speed, so that it could be used in a commercial environment.
How important were other, like-minded entrepreneurs to the success of FourEx?
What does community mean to a startup? We found that we were offered lots of advice along the way, some advice better than other, but every time we followed our gut, it proved to be the correct choice. There were various paths recommended, however most of the time we ended up going the route we had originally felt was the right decision. We have now built up a team of very smart people around us that are not only passionate about our future, but probably the best in the world in their field.
Every good business is out to make a profit while making positive change within the world. How did you approach monetizing your idea without charging commission or hidden fees?
A business has to make a profit to stay in business. We make our margin on the difference between the buy and the sell rate, just like every other currency exchange company. The difference for us is that we pay far less rent, and our staffing costs are minimized as everything is electronically handled. By introducing technology into the equation, we are able to open up a whole new market in the exchange of redundant, leftover currency, while removing all the restrictions. We still make a profit on the transaction, but our technology allows us to process the transaction faster, cheaper, and that is passed onto the customer, irrelevant whether they are exchanging money at Heathrow airport, or in a Zone 2 tube station.
FourEx allows users to donate portions of their cash to a number of charities. Can you tell us why this is important to you and your mission as a business?
The collection of foreign currency is a substantial source of income for many charities, including Virgin Unite and UNICEF, and we didn’t want to make a dent in that. We designed the kiosk so that a customer could donate all, or part of their exchange to one of our partner charities. This facility enables people to do something good by clearing out all their old currency, or simply by rounding down, and possibly donating the coin portion of their exchange to a charity. We are confident that once we have a few thousand machines, we can raise significant amounts of money for our partners.
What is something you feel every startup should have? This can be a tangible asset, an idea or attitude, anything!
Passion, a never give in attitude, and the ability to shrug off rejection. A start up faces so many challenges that the odds are so stacked against you, and that is why you have to respect people like Richard Branson and Elon Musk who have built these amazing companies from the ground up.