Payments Execs Shun Dragons’ Million Dollar Deal

April/March 2010 – Payments News

Payments entrepreneurs Joseph Iuso and Brian Crozier, founders of UseMyServices, did something that no one has done in the history of Dragons’ Den, the popular CBC television show on which people pitch their business concepts to a panel of Canadian business moguls, hoping to get bankrolled by them.

They turned down the Dragons’ offer of a million dollars! The decision was not made in haste. Before appearing on the March 3 edition of the show, the pair had discussed the possibility of a difficult counteroffer, and had come to terms with what they would and would not be willing to give up for the Dragons’ investment.

In a rare unanimous vote, the five Dragons quickly agreed to invest the million dollars Iuso and Crozier were seeking, but they upped the equity stake from the offered 5 percent to 40 percent, and that was the deal breaker.

“It obviously was not an easy decision,” said Iuso, UseMyServices’ CEO. “We are building payment solutions for companies that are household names, and to give up 40 percent of the company for a million dollars is really undervaluing what we have in the works right now.”

In retrospect, both Iuso and Crozier agree that they made the right decision.

The company’s flagship product, UseMyBank, lets customers pay for their online purchases directly from their own bank account, using the online banking services. Its cost is considerably less than traditional payment methods for the merchant, such as credit card processing, and offers fewer risks as well, making it appealing for high-risk online merchants selling travel, telecom and digital products, as well as more traditional Web merchants.

“It’s really a shame that we couldn’t disclose to the Dragons some of the contracts we were working on at the time. It made it tough for us to prove the value of the company to them. It was just bad timing,” stated Crozier, who heads up the company’s business development team. “I think if we were doing the pitch today, it would be an easy deal to close. The phone has been ringing off the hook since it was announced that we made the show, but it’s been an absolute firestorm since the show aired. We’ve had a lot of very interesting meetings in the last few days. Who would have thought that saying no to a million dollars would be so good for business?”

Since the taping, the company has launched a new website and brand, UseMyServices.com, expanded its services to Mexico & Australia, and is poised to launch a new ‘micro-payment’ platform specifically aimed at the multi-billion dollar social gaming niche made popular by FaceBook and MySpace.

A week after their appearance on Dragons’ Den, Crozier and Iuso were ‘saluted’ as business innovators in a commercial by Rogers Communications, spurring more interest in the company.

”We had no idea that this was in the works but we are thrilled to be recognized by a company like Rogers for our technology.” said Iuso, who was in Australia, finalizing details for the next phase of the company’s expansion when the commercial aired. “The popularity of the Dragons’ Den is almost mind-boggling,” he added. “I cannot believe the impact that our appearance has had on the company.”

The exposure from the show and the Rogers commercial has brought UseMyServices to the attention of a number of potential investors.

“I have spent virtually every day since the airing of the show, meeting with potential investors and companies interested in our services.” said Crozier. “It’s not just about the investment, it’s about the right strategic investor, and we think we are very close at this point to making a decision that will carry us to the next stage of our development.”

Both the Dragons’ Den episode and the Rogers commercial can be seen on the company’s website: www.UseMyServices.com.

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