Doug Fieldhouse | Executive Profile | ATLANTA TREND

Vesta: Putting Confidence in Commerce
By Karen Rosen

Traveling the world for a couple of years in the late 1980s, Doug Fieldhouse had a bigger bank account than the typical hitchhiking backpacker.

“I was able to meet people and if their eyes lit up and they’d tell me about a place, the next day I’d go to the airport and I’d fly there,” says Fieldhouse, who had socked away money from a law firm job after college. “I was footloose and fancy free.”

Fieldhouse was particularly taken with Nepal, where he did a lot of climbing and trekking, and explored Petra, the abandoned city in Jordan before it was overrun by tourists. “I visited the mountains I wanted to see and the beaches I’d heard good things about.”

On his journeys, he made extensive use of prepaid cards, which were then relatively unknown in the U.S. Fieldhouse’s familiarity with prepaid later piqued his entrepreneurial interest, launching him into the wide world of payments where he is President and CEO of Vesta Corporation.

“I thought that prepaid would in fact become mainstream eventually in the U.S. and other places,” Fieldhouse says.

Based on that hunch, he was a founding investor in a company in 1995 that sold prepaid long-distance phone cards before moving into card-not-present (CNP) transactions and fraud prevention.

Renamed Vesta, the company now has its corporate headquarters in Atlanta with offices in Portland, Dublin, Guadalajara, and Beijing. It is the telecom industry’s leading provider of revenue-generating payments solutions across multiple channels and the global leader in CNP transactions.

Vesta guarantees payments with zero fraud liability in real time for some of the world’s largest and most demanding brands such as AT&T, T-Mobile, Incomm and its merchants, Sprint, Vodafone, China Telcom and Barclays. Vesta also jointly develops solutions with other leading transaction processing companies, including First Data.
“We like to say we put ‘confidence in commerce’ for both consumers and merchants,” Fieldhouse says.

“We probably manage 50-percent of the CNP transactions in the US prepaid cellphone market. Before Vesta came along, there was not much in the virtual space. Prepaid was primarily cash-based services and solutions. We’re the ones who were out there really encouraging the operators to get their consumers to use electronic payments for these products because there are a lot of benefits for both.”

Befitting a company that thrives on non face-to-face transactions, Vesta is “the best story in payments that no one knows about,” Fieldhouse says. “Some consumers figure out they’re working with us, but most of them think they’re working with whomever the brand is we’re supporting.”

Vesta’s customer service call center operators answer the phones using their partners’ names and Fieldhouse doesn’t employ a large marketing and PR department.
“We’re very happy to sit in the background, facilitate transactions and grow the business,” he says.

The company’s website is called, highlighting the fraud protection at its core. Vesta introduced its new, secure payments platform, named vSafeTM, last April.
vSafe offers a simple integration that is easy to get up and running. Fieldhouse calls vSafe “a much more robust and elegant solution that is absolutely the future.”

Vesta’s revenue-generating payments solutions set includes a standardized Guaranteed Payments offering, Advanced Payments with a wide range of customized options, Unified Payments that delivers a single view  of the consumer across a 360-degree landscape, and consumer lending that leverages Vesta’s  payment history with 60 million thin-file/no file-consumers.

Fieldhouse calls Vesta “the best in the world at making a real-time decision” on the risk in a potential virtual transaction.

“Every partner that we’ve brought on board in the past 10 years has seen two things happen concurrently,” he says. “Fraud goes to zero because Vesta actually is the merchant of record and indemnifies the merchant of any risk of chargeback. And revenue goes up because we’ll accept more transactions.

“It’s really easy to prevent fraud if you just say ‘no.’ But if you’re declining potentially good customers, you’re never going to see them again.”

Vesta does sometimes get burned.  “We lose some money every day,” Fieldhouse says, “but we make a lot more than we lose so it balances out.”

Vesta also supports Green Dot and netSpend. “Talk about an invitation for risk,” Fieldhouse says. “You basically load money over the web onto a card and the person can run to the ATM and get cash, so it’s not for the faint of heart.”

Growth in payment volume through the Vesta engine has been substantial, from $200 million in 2002 to more than $10 billion this year.

Volume has accelerated since moving Vesta’s headquarters to Atlanta, a crucial step toward growing the company globally.

“Atlanta’s been great to us,” says Fieldhouse.  Dallas was the other finalist.

Fieldhouse says Atlanta’s location as the home of the American Transaction Processors Coalition and Transaction Alley is a boon, everyone has been helpful and he’s impressed by the talent pool.

“In a week I can have five face-to-face meetings with customers and partners,” he says. ”I can’t do that in any of our other locations.”

In partnering with companies such as InComm and First Data, Fieldhouse says, “We’re big believers in not dictating how people should do things, but enabling and facilitating. We’re not going to say, ‘No, you can’t do that, do it this way.’ We’re all about having the most variety in channels and support capabilities.

“I like to joke, ‘If someone wants to give us money, you’ll have to work pretty hard for me not to want to take it.’”

In any given month, Fieldhouse spends a week or two in Atlanta, at least a week in Portland, where many of the engineers and IT teams are based, and a week in either Dublin or Beijing.

He manages only occasional weekends at his home in Ponte Vedra Beach, Fla.
Understandably, Fieldhouse has millions of frequent flyer miles. For the first time, he’s cashing some in this summer so he and his wife can take a 25th anniversary trip to Budapest, Prague and his former hometown of Vienna.

Fieldhouse was born in Germany and did not know his parents worked for the CIA until after they retired from the intelligence community. The family moved to Washington D.C. when Fieldhouse started the fifth grade.

He majored in International Relations at Antioch College and envisioned working for the State Department -- though not as a spy.

Switching his interest to entrepreneurship, Fieldhouse was the founding administrator in 1984 of a law firm focused on environmental litigation.

After his father died unexpectedly in 1986, Fieldhouse left the law firm to travel. He visited 57 countries in two years before deciding it was time to return to the United States.

“I think I came to the realization I either had to stop or I would never stop,” Fieldhouse says. “It was a lot of fun and eye-opening and I had some great experiences, but I had to come back and join the real world while I still could.”

Fieldhouse wouldn’t be starting his new life alone. In Taiwan, near the end of his trip, he met his wife. They have two children who are in college.

In 1989, Fieldhouse founded and was executive director of Damocles, a non-profit focused on providing environmental educational materials to schools.

Damocles had offices in Washington, London and Nairobi and worked with the United Nations. After the Earth Day Summit in Rio de Janeiro in 1992, funding dried up.
Fieldhouse then worked as a consultant. In January 1995 he helped found Carrier Services, Inc., the precursor to Vesta. Fieldhouse was the investor while a friend from high school managed the prepaid long-distance telephone card provider accounts.
Needing an influx of cash, they raised an angel round from investors in New York in August 1996. Fieldhouse was convinced to come in formally as the COO in September.
Fieldhouse, who was appointed president and chief executive officer in May 1997, raised more money from his investors and the business became successful in 1997-98 by partnering with United Airlines and American Airlines to sell cards pre-loaded with both minutes and frequent flier miles.

“Some people joked we were selling miles and throwing in phone time,” Fieldhouse says.

The $50 phone cards came with 500 miles and could only be activated by calling 1-800-PREPAID1-800-PREPAID FREE and linking to a credit card.

“At the time people thought we were crazy because they said anyone using prepaid didn’t have a credit card,” Fieldhouse says. “In part because of my experiences in Europe and Asia we said, ‘No, prepaid could become mainstream.’ And our initial success was really linking it to frequent fliers.”

In the era before cell phones, business travelers who were tired of paying $1 a minute to use a hotel room phone simply put the cards on their expense accounts and kept the miles. The company targeted fliers close to an award ticket.

But in the fall of 1998, AT&T and MCI decided to sell prepaid directly to consumers instead of continuing to let outside parties run the market. “We thought we were going to circle the drain and shut the business down,” Fieldhouse says.

Instead, they took stock of what they had. They had developed some effective fraud capabilities, were very good at abetting payments, and were excellent at customer service.

“I got on a plane and flew around and started to talk to our partners about a new approach. Rather than competing with them and trying to sell phone cards as 1-800-PREPAID1-800-PREPAID FREE, I would just provide their back office support for phone and web-based payments,” Fieldhouse says. He notes that Vesta still supports long distance, but while it once was 99-percent of the business, now it might be one percent.

The name of the company officially changed to Vesta in 2000 in concert with the shift.
Its vaunted expertise in risk management came about unexpectedly. Fieldhouse, the co-author of several fraud-prevention patents, says the company “had to get good at it because in the early days our payment processing partners came to us and said, ‘Fraud’s too high. Fix it or we’ll shut you down.’

“So, a couple of the engineers and I sat around a room for a couple of days saying there must be some way we can thwart these people. Trust me; they did all the big thinking in figuring it out. I called the meetings.”

Today, Vesta has about 800 employees worldwide, with about 450 in call centers in Atlanta, Portland and Dublin.

Providing a good customer experience, Fieldhouse says, “is critical because it’s not only us, it’s our partners’ reputations. Our call center folks always get some of the highest marks in the industry from our partners.”

After an increase in automation shrunk the work force, Vesta now is experiencing a growth spurt and plans to hire close to 100 engineers this year.

Fieldhouse, who has been honored by ComputerWorld, Fast Company and Inc. magazines for his leadership and innovation, looks for three attributes when hiring people: Smart, hungry and humble.

“Smart people for obvious reasons,” he says. “Hungry because we’re trying to grow. I have this discussion with people, especially in Portland, that it’s not a lifestyle company. I don’t want people who leave every day at noon to go ride their bike. I want people who have passion to succeed and to win. We’re really trying to build something meaningful.
“I don’t mind them taking a lunch hour, but I want them coming back after riding their bike.”

Finally, Fieldhouse prefers humble people “because the big egos just get in the way of what we’re trying to do.”

And that’s grow.

“I’m probably more excited now than I have ever been because I think the next couple of years will be our best ever,” Fieldhouse says.

The recent data breaches and fraud attacks at the point of sale are forcing businesses to crack down in that area.

“We’ll actually see a lot more fraud coming back online in the next couple of years,” Fieldhouse says. “That’s good for us. It makes more and more of the merchants that we want to work with interested in exploring opportunities. We feel very strongly we can help them: 1) solve their fraud problem and 2) help drive incremental revenue which is good for everybody.”

Along with growth in the U.S., he sees major opportunities in Latin America and Europe in both telco and non-telco ecommerce.

“It’s a fun business,” Fieldhouse says. “It’s dumb luck that we hit upon electronic transactions when we did. Anyone who tells you success isn’t partially luck is fibbing.
“There are a lot of people who take themselves a bit too seriously and think it’s all about them. It’s really not. It’s a group of people. It’s being in the right place at the right time and part of the dumb luck is being able to take advantage of it.

“We don’t have any wise old men who are sitting on the mountaintop who really had all this figured out.”

So he never met a wise old man on a mountaintop in Nepal? “I keep looking,” Fieldhouse says.

In truth, he already knows the key to success.

“It’s hard work,” Fieldhouse says. “And I like work.”


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