Hyper-scaling partnerships in payments with Checkout.com’s Tracy Meng
In early 2020 Tracy Meng joined the European-based payments startup Checkout.com as its first US partnerships hire. The company had recently raised a large series A and was valued at $2B. Then covid hit. Consumer spending online soared. Checkout.com’s single API solution proved to merchants that it was built to scale. Eighteen months later Checkout is valued at $15B and Tracy oversees a global partnerships team of nearly 15.
Given Checkout.com’s rapid rise and complex partner ecosystem, I wanted to hear Tracy’s perspective on lessons learned along her journey from management consulting at Bain & Co. to payments at Google to startup life at Cruise to now to Checkout.com.
Some highlights from the conversation with Tracy:
What to focus on when hiring for BD
Building a moat in your career
The key to collaborating with other teams internally
Navigating when a competitor becomes a partner
Identity at work as an Asian American female leader in tech
Getting to know Tracy
What is Checkout.com? What is your role?
I lead global partnerships for Checkout.com, an international payment service provider with more than 150 currencies, in-country acquiring, world-class fraud filters and reporting through one API.
How do you measure success of partnerships Checkout.com?
We are a revenue driven partnerships team, I report to our CRO. We are measured by the revenue we bring in through channel partnerships as well as revenue unblocked by integrations and strategic partnerships that help our merchants get the best-in-class solutions to scale globally.
One partnership principle you live by?
The golden rule: treat your partners the way you want to be treated. The payments world is small world and it's a tight-knit network. What goes around comes around. If you play games at the negotiation table or are difficult to work with, that reputation follows you around, for the company and your personal brand.
One habit or tactic that has been key to your success?
I face a lot of decisions, big and small, and I started adopting a decision-making framework I heard from a successful CEO. I now categorize all decisions as either a two-way door or a one-way door. If the decision is a two-way door I know that I can always test and iterate and go back, so I tend to make those decisions quickly to keep things moving. For one-way doors I take more time and do my diligence. It’s an approach that has helped me be more productive and effective at my job.
Book you strongly recommend?
From One to Many by Dee Hawk - a really interesting book about Visa’s origins and growth.
Partnership Lessons Learned
The fintech ecosystem has a complex value chain across banks, issuers, acquirers, gateways, processors. How would you explain the value that Checkout plays?
We differentiate from other processors in a few ways: We’re a single API which means one integration gives merchants access to all our geographies, payment methods and features; yet we also offer merchants a level of flexibility - they can pick and choose which features they want to use. We have direct connections to the networks and our own acquiring licenses in many key geographies, which many other payment providers don’t support. We also offer solutions for fintechs like account funding and withdrawals.
Embedded in your answer is the fact that you have instances where your customers are also your partners. How do you navigate the blurring of those lines between customers and partners?
Those are some of our favorite situations - when a customer becomes a partner or vice versa. Nearly every digital business accepts payments, so often times a partner will start out working with us because we have complementarity or can serve as referral channels for each other. From there, they may realize that they can use us for their payment services or embed our product via an integration.
Some of those relationships are the best ones we have because we’ve built the trust as partners first and foremost.
And what about navigating that line internally with your sales team seeking to monetize those relationships?
It’s simple in our case. When there’s a merchant opportunity - i.e. where there’s direct pricing - our sales team leads. When there is a partner that can serve as a referral channel or wants to integrate with us, then the sales team sends the opportunity over to our team.
It is really up to the leaders of the organization to build a healthy culture of collaboration so these teams - sales and partnership - can work better together, so that the sum is greater than the parts rather than being territorial.
At the end of the day, sales and partnerships teams will add different value to a commercial organization and you need the combination of both.
What do you do to foster that culture?
It goes back to the golden rule, but this time applied internally. I always coach my team to be the first mover in collaborating well with other teams, that is, bringing other teams early and often. Making that first move opens the door to reciprocation. If you start out saying ‘I need them to show me that they’re willing to work with me,’ that is where the culture can spiral downward. If you want to improve culture, you have to take the first step, especially as a leader.
How do you handle situations where you don’t feel you’re experiencing the golden rule by a partner?
In those cases I try not to take it personally. It puts into question whether the partnership is worthwhile, if it’s a long-term bet for us. And if it's not, that’s okay. We can work with another partner if the one we initially chose is not holding up their side of the agreement. The thing that I try to do and coach my team about is to be upfront with the partner about where we do compete and where we may have intentions to compete. For example, if we’re working with them today as a partner but we’re planning to go live with a competitive feature in the near-future I think it’s important to be upfront and not leave a partner feeling like you just worked with them to learn their secret sauce. That destroys trust. In those situations you should either choose not to engage because they’re going to become a competitor or you should be upfront and explain that you’re going to work together for a quarter or two but then are launching your own capability in this area.
And I imagine you also have partners that have competitive offerings. Is there an example that comes to mind from either your current role at Checkout.com or a previous role?
Payments is very interconnected with spaces such as fraud, payouts, etc. In certain cases we may bring in a partner that can provide features in certain markets but also competes against us in other areas. One example of this is the payouts space - Checkout has its own payouts products but if a merchant needs a certain geography covered that we don’t support today, we’ll work with a partner (who may compete in other areas) to support the merchant. Ultimately it's about the customers and doing right by them and we will work with competitors for that purpose.
With those nuances we discussed in the payment ecosystem - navigating partners, customers and competitors as an up-and-coming provider - how do you approach hiring for the partnerships roles at Checkout?
I always tell hiring managers that Partnerships roles can mean different things in different companies, from revenue-driving partnerships to product partnerships to vendor management. I think it’s really important to understand what your team’s KPIs will be. In my team’s case it is revenue, so I’m looking for people who are partnerships-driven but also have revenue experience, whether that’s sales or a partnerships team where they had to sell the vision of the partnership to the third party. There are different types of leverage in partnerships - there are some people who have partnerships in their title but their role was largely about vendor selection and they had a tremendous amount of leverage. That is not a skill set that is as applicable to the type of partnerships we do on our team. There are other people who have focused on technical integrations that involve long deal cycles with a very small number of partners. So it’s important that you understand what kind of partnerships and KPIs you’re hiring for.
I also look at the number of partners a person has worked with. Did they just work with a few partners and go very deep with them? Or did they work on a large number of partnerships across a broad portfolio. Are you able to work at the velocity of this role?
I think that’s the biggest thing - making sure you understand the dynamics of how your team operates, what your team needs, not just having partnerships in their title. In many cases someone may not have partnerships in their title but they have the characteristics for what it will take to win in the context of your team.
Careers today are often non-linear. You spent years in the payment space and then went to Cruise (autonomous vehicles) before joining Checkout. How did you decide on making those moves? What drew you back to the payments space and to Checkout.com?
I would be lying if I said all my career decisions have been calculated, strategic moves. Many have been products of luck (or lack thereof), timing, gut feel, personal needs of that season of my life. Where I have been strategic, I’ve tried to grow my personal moat (similar to how a company would try to build one to be competitive) either in the direction of functional expertise or industry expertise, or both.
For me, I have doubled down on the Partnerships / Business Development function because I truly enjoy it and think it’s a good intersection of my strengths and interests, e.g. building relationships, finding mutual value. I started out as an individual contributor, learned the ropes, became a manager, then a manager of managers, all within the function. I also knew I wanted to grow my industry expertise which is partly why I returned to the payments space. I think it was important for me to dabble in other industries such as the AV space, but ultimately I was excited by all the innovation in payments/fintech and loved the complexity.
Checkout was a far smaller player when you joined 18 months ago and its valuation has skyrocketed during the pandemic. What gave you confidence in the business back then given the highly competitive environment Checkout operates in.
What was compelling to me about Checkout was that I’d been in the payments space, and I knew the gaps in the ecosystem. I knew from my Google Pay experience that when we would talk with various processors or acquirers that didn’t have that single API approach it was really painful for merchants to innovate. That previous experience allowed me to see the hidden gem that Checkout was. On top of that, the role allowed me to grow as a leader, I clicked with my manager, and the people I met along the way were great.
Fintech + crypto
What’s your perspective on the rapidly growing energy around crypto and web3. It feels like we are in the midst of a massive disruption of legacy financial institutions and, at the same time, a whole new era of disruption is unfolding with crypto and web3.
Personally, I’m excited about this space as a whole and think it’s here to stay. Blockchain protocols, distributed ledgers, and trustless ecosystems are driving so much innovation in financial applications, such as cross-border money movement or solutions to unstable currencies or governments. Beyond finance, anything involving validation of ownership (luxury goods, tickets, homes) can see efficient use cases via the blockchain. Do we know all of the players that are going to come out on top? Not yet, and I definitely don’t try to give advice on what to buy. But the building blocks are there for crypto to be game-changing.
Identity at work
As an Asian female leader working in the fintech startup scene, still dominated by men, how do you feel things are unfolding with respect to bias and discrimination? Have you experienced things improving, staying the same or getting worse?
Overall, I’m optimistic about the macro picture. I see a lot of effort being made by companies, and there’s a lot of media scrutiny of discrimination in the workplace, gender and racial equality. Diversity and inclusion is a big topic, nearly every sizable company has one person or a team dedicated to it. That’s really important.
However, there’s still a lot of work to do to change things at the micro level. Recently I went to a conference and was trying to have a discussion with someone at a happy hour. He had had a few drinks and started hitting on me, and I had to leave because clearly the discussion wasn’t going anywhere from a business angle. Maybe if I were a man it wouldn’t have gone anywhere anyway, but because I was a woman it was definitely not going anywhere. I just kind of felt disheartened and didn’t try meeting other people that night.
There’s no silver bullet here but the silver lining is that these experiences make me so much more empathetic to what women and underrepresented minorities may be facing on my team, and I try my best to protect them and support them with what I’ve learned facing similar difficulties throughout my life and career.
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