After seven years helping Citigroup launch new financial ventures, Jay Bhattacharya got the itch.A veteran of the first dotcom boom and bust, he’d found a safe perch at Citi. But he found he wanted to launch his own company again.
At Citi, he’d worked his way up to a senior vice president job, responsible for funding startups, with all the salary and perks afforded to a senior banking executive. He was a family man now, with a wife and two kids.
Then his latest venture, Mobile Money Ventures, a startup backed by Citi and SK Telecom, was acquired by Intuit in 2011 for an undisclosed sum, after a “whirlwind two years,” he says.
Bhattacharya’s stake wasn’t enough to retire on, but it was enough to bootstrap a new company—if he could get his wife, herself a banker, on board.
He was on the first week of a monthlong vacation after the Mobile Money sale when he met Jake Howerton. Howerton wanted Bhattacharya to vet his idea for a new payments startup based in New York. Bhattacharya loved Howerton’s idea for what became Zipmark—so much so that he wanted to sign up as a cofounder.
“I spent another three weeks of my month off convincing my wife that it was the right thing to do,” Bhattacharya says. In the end, she agreed on the condition that Bhattacharya take on consulting work to help pay the bills while he got Zipmark off the ground.
Zipmark offers an alternative to paper checks, credit cards, and PayPal. It lets people pay for stuff from their checking accounts though mobile apps. It also lets small businesses take personal checks without assuming the risk of bounced checks.
“We act like credit cards but for paper checks, with an authorization or decline,” he explained. Businesses like it because it charges It charges a 1% transaction fee. Square, for instance, charges 2.75% for credit-card swipes, while PayPal charges 2.9% plus a 30-cent transaction fee, even for low-cost payments from checking accounts.
Businesses can also use Zipmark to pay their invoices instead of writing paper checks or setting up electronic fund transfers, Bhattacharya says.
A year ago, Zipmark raised $3 million in seed financing from a handful of New York investors and was on its way. It now has nine employees. Its beta app processes $1 million a month in payments thanks to partnerships with cloud services like Zuora and Apptivo, as well as with RentShare, an online service for accepting rent payments, and some utility companies.
The app will leave beta testing early next year, with an official version going live in January.
Bhattacharya often speaks to college students and young entrepreneurs on what it takes to found a startup. “I tell these guys, it’s OK to take the risk,” he says. “There are ways you can find the incremental income.”
The real challenge: Figuring out how “to program your brain” to work outside the “structure” of a regular job, he says.