Providing Smart Money for Everyone

  • Nick Jones, CEO, Zumo

  • 26.06.2020 12:35 pm
  • 690

Financial IT interviews Nick Jones, CEO of Zumo

Financial IT: Can you please tell us more about your background? What’s the story behind the founding Zumo?

Nick Jones (NJ): I've been working in consumer technology space since 1999. I worked in the early days of commercial search engines in the UK. And eventually, for an American start-up that was brought by Yahoo, the biggest Internet company in the world at that time.  I witnessed the very early commercial adoption of the internet and the commence of mobile web and social media as the major means of commerce. I used to run a digital marketing agency in London which I co-owned for a number of years in the mid-2000s. I sold that business in 2012 and I spent the period between 2012 and 2018 mainly investing in AI, big data businesses.  In 2017, I'd started to get very interested in the blockchain space what I believe will be the next big disruption and game-changer. This is why I followed AI and big data so closely. What mainly concerns me is how blockchain could be adopted and the whole idea around data sovereignty and people powering the Internet. As a consequence of that, my attention was drawn into cryptocurrency space. I came to crypto because of becoming very interested in the underlying blockchain technology, how that could really change the internet for the better and give people far more control over their data whether that was financial or personal. Paul Roach, my co-founder and I worked together at Yahoo all the way back in 2003. We've been talking on and off for the last 14 years about doing that some kind of business together. It just happened that we moved to the same city at the same time I was finishing my cycle as an investor who had been running product development, business building products for other people. We decided to use our skills to build a blockchain-driven project together. He worked on the product development side while I worked on the building companies, teams and marketing.  The timing of our project felt very familiar to me with the period when the different technologies were becoming ready for mass adoption. The examples of this kind of timing can be the development of the internet post the dot-com bubble burst in 1999, ICO bubble bursting and crypto winter in 2018. It felt like an interesting time to get involved. We were in a city with lots of good development talent and we've met a very good team in Ljubljana in Slovenia. Thus, we came to the conclusion that the time was right to launch something. This is the ‘genesis’ of the team coming together. The reason why we decided to build a fully decentralized non-custodial wallet infrastructure as our core piece of technology was by identifying most of what was in the market at that time as the typical first-generation product. They were not very secure nor usable.  They didn't work on mobile phones. They were very confusing to people who didn't already hold the cryptocurrency.  Moving out of cryptocurrency and into normal traditional money was very difficult. There was a number of things that look like they were broken in that space. Therefore, we decided to build Zumo SDK to offer other businesses and then to take to consumers as well. We wanted to build something that was very secure and very usable not just by the people who are already into cryptocurrency, a product that worked on mobile phones and provided a bridge between old and new financial world. Those are the core governing principles of our product and our mission.

Financial IT: What is unique about Zumo and how does the company do to stand out among its competitors?

NJ: There's obviously a large number of both digital wallets and specific cryptocurrency wallets in the digital world. We wanted a product that wasn't like the products that already existed in the market. What makes us stand out is the principles that we decided to build a product upon.  To address them by topic, the first one would be about security. Our mission was to build the most secure possible way for people to access their crypto money.  To achieve our goal, we've built noncustodial wallets.  We never own custody of our users’ funds. Those funds are always held on the chain so that our wallet effectively allows people to go on and off-chain, to access their funds on chain in an absolutely secure way and to have a patent around that security process. We made it as decentralized as possible by following the principles of blockchain with the ultimate and utmost security unlike most of our competitors who have a central repository of funds. Looking at most of big exchange hacks over the past three years, it becomes clear that because they haven't followed blockchain theory and they have collected all the crypto in a single ‘volt’.

The second principle is around usability and really building up a product for max adoption, not just for people who are already interested in cryptocurrency. Thus, we've always built further to be able to have a user who's never experienced anything in the blockchain or cryptocurrency space, to have an application that is as good as any of the Neo bank or Challenger Bank apps and is easy to use as it helps to guide people through that process of taking their first steps. We're seeing a huge retail interest in cryptocurrency at the moment as people look for alternative ways to invest their money rather than the stock markets that have let people down. Someone who'd never thought about the crypto space can pick up the app on board and understand what to do and to take the fear factor out of it for them.  We've executed the app around simple adoption and practice. For instance, we are currently offering only Bitcoin and Ethereum. We will be adding further crypto over time but not more than 10 because it allows us to explain effectively how cryptocurrency works and what it does. Most of our competitors are very focused on offering 100 different cryptos. It's way away from what's understandable. However, we desired our product to be informal and easy for everyone to understand whilst also being very useful for people who already have crypto as most of them have the bulk of their assets in Bitcoin and Ethereum. Our goal was to make something that was very useful for them as well to be able to quickly store their assets without having to use cold storage or a USB stick and to be able to turn that crypto into normal money, to use it in the real world.  

The third differentiator for us is our exchange service to other businesses as we have always built Zumo with partnerships while powering other people's businesses in mind. We offer our wallet as an SDK to other developers and to other businesses. That is due to the fact that we have a wide understanding of how building blockchain can be an issue for people because of its complex nature. It's taken us two years to build this wallet. Now we can offer that to people where they can integrate the wallet into their platform very easily and cost-effectively. We think that's important in the developing world, particularly. We want to offer this solution and secure and easy access to alternative finance to developers in Latin America, Africa, Asia markets. We have a couple of partnerships coming up. One in India where we'll be providing the crypto exchange, wallet functionality and a number of other kinds of projects of working with other blockchains to a new near bank that London is launching there soon.

The fourth distinguishing factor is that we have always built from the start with the regulation in mind. We're working towards being fully regulated with the FCA in the UK as an EMI business and also midway through our five MLD authorization on the crypto piece. We've engaged as early as we possibly can with the regulatory piece because we believe that space will be fully regulated in the next few years and we want to build something that has consumers’ trust and regulation piece at the heart of it. These would be the four things that we see as our strong differentiators.  

Financial IT: You've recently rolled out payment and exchange cryptocurrency app for the mass market. Can you tell us more about that launch?

NJ: We've been in stealth mode on the App Store's for a few months just making sure that the security of the wallet, the core user interface and the onboarding process are as good as we hope they are. First functionality we're rolling out is the exchange functionality to allow users to exchange between Bitcoin and Ethereum. Over the next two or three weeks in the UK, we will be launching our sterling wallets and e-euro wallet. Following that, we’ll be adding further coins, tokens and other fiat currencies as we move along. Over the next year, our goal would be to support another four or five of the most reputable and easy to explain cryptos which are very secure and well-capitalized from a market point-of-view with some price stability. Then we would look to add more fiat currencies as we go interaction in other markets. That's one focus of the continued role of roll out over the next few months. We'll be launching our debit card in the UK in September and we look to launch that product in other markets as quickly as we can. We have crypto-based savings-and-loan product what we hope to be able to launch by the end of the year. Longer-term product, the next vision for Zumo is the function that allows users to store not just their financial assets but their other data in a tokenized way within their Zumo apps so they'll be able to store their health, genetic and employment data. Zumo is a key for the internet and broader way not just as a financial perspective.  We will work towards delivering that vision over time. That's how the product will continue to roll out. Our goal is to always be at the edge of what's possible from the technology point of view in the space but always ensuring that it's easy and simple for a user to understand so that it will have a value for people.

Financial IT: What's next for Zumo?

NJ: We are focusing on partnerships. Our partnership conversations are mainly concerning about different crypto exchanges, whether or not they are looking for e-wallet solutions, new protocols and blockchain that are looking for consumer adoption so that we can integrate it if they fit our criteria into a wallet. We see ourselves rolling out globally in Latin America, Africa, Asia providing our services. We would far rather work with local partners in non-UK, non-EU markets. We believe it is the quickest way to market but also best ones in terms of local knowledge, distribution costs and understanding that all markets have certain different requirements. The plethora of exciting things are coming out from the consumer point of view. We are the product which offers sterling and euro wallets, crypto-based loans and saving products, debit cards and some interesting technology developments through our private key recovery we are working at the moment which will help us to stand out from the crowd as well as being fully regulated business by the end of the year.

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