YouSaid · the spoken record

Jennifer Bailey

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29
first
2024-10-22
most recent
2024-10-22
sittings or episodes
1
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podcast

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  1. “I'll say this even though it sounds a little bit overdone and trite, which is truly staying focused on the customer experience. And I always remember I've had new people start from outside the company and they come in and they don't really realize how customer focused we are until they see an executive make a decision that costs us more, delays the timeline in order to do the right thing for the customer. So I think a lot of companies say this, but I don't think they actually put their money where their mouth is. Second thing I would say is patience and tenacity are everything. So I'm sure many of your entrepreneurs know that, but if you believe what you have is truly valuable from a consumer perspective, you need to stay patient and tenacious in making it happen. And that's even true at a large company at Apple. These things are not easy. And so those characteristics come to be very important.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Second timeframe from a performance perspective and seeing people just be able to tap their phone or their Apple watch and go through those turnstiles, it is a phenomenal use of the technology. So I'd say that was a really big one. And I think another one that we were just really happy with has been really changing AppleCard and sort of setting a standard for some, even offering and business practice associated with cards that hadn't been in the market before. And so that was also a great moment. But there are many, as you point out, we've done a lot of cool things.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “Have to say a couple of them, which wouldn't maybe seem obvious to people. I would say maybe the first time I stood in Tokyo in one of the stations and used Apple Pay for transit there, you know, the throughput requirements to get people through those turnstiles, as you know, is.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Well, back to daily cash. So we thought most points programs over time feel like they're devaluing. So how can you take a points program or a rewards program, in other words, and help it grow? And so that was really the idea behind savings. It turns out, again, when we're talking about timing, the timing of our launch of savings was fantastic because it was when interest rates were going up. And so Goldman, our partner, was able to offer a high savings rate, which actually drove not only people to put their daily cash into their savings account, but also other deposits as well.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “Their purchases quite easily. And then daily cash. We thought long and hard about the rewards program for AppleCard and many of our executives, many of our designers had been using points, cards, points programs. You're quite popular, as you know, in the US. And I think the lack of transparency in terms of what I'm actually really getting in terms of value for my points and the fact that card companies can value and devalue those points really without sort of any notice, if you will, to consumers we felt was not a great value proposition in terms of the lack of transparency. So we did something called daily cash. And so you get cash back every night that you can spend using your Apple Cash card to tap to pay anywhere or to send to friends and family. So those were some of the things that we wanted to do with the credit card when we started out to design it.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “A thing people need to have, particularly when you live in a place like the US where you can't rent an apartment, you can't buy a car typically, you can't obviously own a home unless you have an established credit record. So it's actually very important for people to have credit and to be able to use credit responsibly. So as we created AppleCard, we really wanted to do a couple things. One was make it mobile first, of course, all the way to the way we handled chat and customer service. It's all mobile first. But the other things that we really wanted to do was to make it, as I said, financially healthy. And so we have this thing called the interest wheel where you can put in your payment and it's going to calculate how much interest you're going to pay. We have no fees associated with late fees or foreign exchange fees and all these little gotchas that can be not very transparent to consumers. And we have ways to help people see how much they're spending in an easy visual way and where they're spending it and to be able to really track.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “I would say for years and years, and again, I've been at Apple, as you said, a long time, there was always a discussion about whether Apple should have a co-brand card. Very common thing for large companies that are merchants in particular, whether you're thinking Best Buy or Macy's or whatever. And obviously we're a large merchant through the App Store as well as our Apple store. And I think until we got through our first several years of Apple Pay and had a lot of experience working with the banks and spent a lot of time in financial services generally, did we get comfortable, I think, with the idea that we could actually create something that was very differentiated and really highlighted and showcased our values around this. You know, there are a lot of really bad things that credit cards can do to consumers. So as we looked at it, we really wanted to create a credit card that people would use to be more financially healthy. Credit is”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “Whatever financial service you want. But that does not exist today in any sort of real form. You can imagine things like, you know, we do open banking in the UK, which is a regulatory enablement to allow people to connect their Apple Pay cards to their bank account. And then that allows us to show the consumer things like their account balance for their debit. So when they're making a purchase, they can see, I do have the funds in my debit account to actually make this purchase. And so in the future, you could see if open banking becomes a reality in the long term, you could see that data being on the device as we do in the UK and giving users control over it in that way being able to provide more of this filtered matching service. But today it's very hard to do without a lot of data that sits in servers and that's not a model that we would pursue.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “So we had debated this internally. It's a really good question. If you think about the marketplaces today that exist, pick one for financial services, somebody like Credit Karma, as an example. Credit karma uses a lot of personal data to be able to best match you and the hundred things they have in their marketplace that might be related to what you're looking for. And so I think given that we don't have the data, at least sitting in our servers, which is the way credit karma does it, and most marketplaces are server-based, we have not gone down a path to do things that are more marketplace oriented. I think you could imagine a world where more of that data resides on the device and the consumer has control of that and can say, yes, I want to provide this data for the purposes of you giving me the best recommendation in credit cards or giving the best recommendation.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “Yeah. So let's start with the first part of that, which is whether it's inbound or outbound from our perspective. And I would say usually in the very early stages of a vertical, so we would call keys a vertical and transit as a vertical. I would say that it's largely us outbounding to a couple of the key infrastructure partners to collaborate under NDA on the kinds of experiences we think we can enable. So just like payments, we have to work really closely with these integrators because we don't own the whole.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “You could do that with an app to check IDs that way. So I hope soon that you and I will be able to leave our California driver's licenses at home.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “I love that feature as well. So we have car keys. We've worked with Disneyland on access passes to Disney World. We just launched scooter keys in Taiwan, and we'll be expanding that into other Asian countries, as well as hotel keys. So I think all those things that you think about that you carry in your wallet or your keys, you know, we're really on a path to try to replace those with more secure and private versions of all of those. And so we know that in the future, you know, you will be able to leave your wallet at home. The last area I forgot to mention, we are starting to work on IDs. We work with a number of states in the U.S. to provision state driver's licenses into your Apple wallet. First acceptance is at TSA locations typically in those states. And then we've just enabled this last year, the iPhone actually to be an acceptance reader. So if you were a bar as an example and you wanted to check IDs,”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “The precursor to Wallet was really when we started airline boarding passes a long time ago. And ever since then, I think we've had a goal, I would say, that in the long arc of time, we would like to replace your physical wallet. And so as the years have gone by, we have focused on different things that are in your wallet. Tickets is one. Transit passes is another. You can now tap to ride in over 250 cities globally just with your phone or Apple watch. Some of those use proprietary transit cards. Some of those use what we call open loop, which would be standard debit and credit cards. We've done work around loyalty. As you know now, we also do student IDs. So many campuses in the United States now, you can add your student ID to wallet and you can tap to get food, tap to get into your dorm, tap to check out library books if anybody does that anymore. Car keys. We have launched about”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “We really focused on security first, as you mentioned, with a lot of these technologies that were just in the early stages of coming to life. The second thing that we did on the privacy side, I remember really some very specific design meetings where we would talk through different architectures about how the transactions could flow and how they would be detokenized or how the cryptogram would be read. And we were very clear and specific in our design goals that we did not want to have that data. We didn't want to be able to see it. We didn't want to be able to aggregate it. It was very clear in our design that when you pay in store today using Apple Pay, we don't see that transaction. It goes up the traditional payment infrastructure into the network and into the issuers through the acquires, et cetera. And so that was a very specific design goal of ours, which was to make sure that we weren't, if you will, a honeypot for all of this very sensitive transactions.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Yeah, definitely. In the early days and the early design of Apple Pay, we were collaborating with obviously internally on the engineering side, but also with the networks. You know, the tokenization schemes that we use are network-based. So Visa, MasterCard, Amex, and then now we work with these domestic networks as well. And so it took collaboration and design really across these parties to agree on what was the best technical architecture and the most secure architecture. And so there are pieces, obviously, on the phone side, the things like taking a token, encrypting it, storing that in the secure element, and it can only be released with a biometric. And then on the network and bank side being able to take those tokens, validate the cryptogram, validate and translate the token in a way that the banks could then process the transactions. So it was collaborative.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “Yeah, it's a great question because, as you know, payments can be a very local thing in countries. Most financial services are very local, country-specific. When we looked at expansion priorities, we really were looking at a couple of things. First of all, obviously, how large was the active iPhone base can't do Apple Pay unless you have an iPhone? The second thing was contactless infrastructure. Was it an early or a late market? And then the third was really was the ecosystem available and ready to do the work and integration and sort of willing to do the integration. And where that's important is when you look at countries that have large domestic or”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “When we launched in the US, we knew it would be slow going given the acceptance infrastructure here. As we looked outside the US, though we could really see as we launched in more of these countries that had contactless acceptance, we could really see it take off in the consumer base. So we knew that the, I like to call it the formula, you know, the formula of the value proposition for the consumer was really there because we could see the growth happening in these other markets. So when you look at it in global terms, I would say maybe three, four years into Apple Pay, we felt like, okay, this is really going to scale given what we were seeing primarily in the international markets. And then at that time, we started adding functionality like online. We started adding transit and some of the other wallet capabilities that also take advantage of some of these technologies that we have built into the phone. And so with those additional capabilities, we knew that we could get this to a global scale.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “Well, first of all, at the time, and still today, obviously, the vast majority of payments, if you look at the aggregate, I think 80%, something like that, of the transaction volume is still really coming offline. And so I think that and the combination of the hardware technology and the capabilities that we had, we felt like it was a fantastic use of NFC and the secure element chip and just the whole technical architecture was really made for offline in many respects. And so I think because the scale was there, we obviously saw these markets outside the US that had fantastic contact acceptance. So going after the offline market seemed to be where the most consumer impact would be.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “As you point out, it's really a multi-sided network. And so those are hard. You know, you have the chicken and egg problem. I think the good news here is that the banks, particularly the early banks that we worked with, both in the US on a global basis, really did see the benefits of the privacy and the security and could understand that customers would really want to do this over the longer term. So there were technical requirements that the banks had to do. And so that took time, but I think the value proposition that they saw, they liked and they were also in the phase of trying to drive more mobile engagement with their customers, more mobile downloads of their apps. And so having Apple Pay helped achieve not only better security and payments, but also more mobile engagement and download of their banking apps. And so that was really positive. The biggest challenge was really acceptance and trying to get acceptance.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “As well. But still, took time in the US, as you probably know, has taken time in the US to get to the acceptance levels that some of these other countries have”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “No, one of the things you find out about payments when you get into details is very different on a global basis. So in the US, contactless was not a thing, right? When we launched Apple Pay, I believe Contact Los Acceptance was at 3%, but we saw outside the US and places like the UK and Australia high adoption of contactless cards where regulators there had mandated the move much faster and much earlier than in the US. So as we launched in these countries, we could really see the benefit and the uptake of Apple Pay where acceptance was high. And so we knew that the experience was fantastic. People were going to love it, but we had to work through this acceptance program. And what helped us was as we were launching Apple Pay, they were mandating chip acceptance, which really required merchants in some ways to upgrade their hardware. So if they were upgrading their hardware to do chip, they might as well upgrade it to do contactless as well. So that helped.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “We just felt like payments was an area that had a couple of friction points and things that we could really solve for customers that we thought were really important. And the first was obviously making payments much more secure. You know, these plastic cards had been around for a long time. We looked at that and said, hmm, gee, I think there's some better technology than using plastic cards to do this kind of thing. We thought we could make it easier. We thought we could make it more private for customers. With the technologies that we had developed as we looked at the user experience back then even, I think there was a view that in some number of years, everyone should be paying this way”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “I mean, my story to come over to Apple Pay is sort of an interesting one. I had been running the online store for 10 years and I was ready for a new growth opportunity. And I went to Tim and I said, you know, I'm ready to do something else. And he said, well, do you want a big operational job or do you want to do something that's more like a startup? And I said, well, I think I'd rather do a startup, you know, because that's what my background had been in. And I love that part of the creation phase and the risk-taking phase and all of that. And so there were a few things that he had me go look at. And there were some engineers working on the.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “And that continued to provide great growth opportunities and challenging roles within the company to do new things and continue to really grow the footprint that Apple had and the consumer base that we had.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “Yeah, it was super fascinating. So I came back to work for Tim running the online stores. But when I came back, actually the first new platform was really iTunes and the iPod. So the iPod was introduced, I think, in 2001. I came back in 2003. And that's when we really launched iTunes for Windows, which is where the growth really started to take off for the company. Well, I came back in 2003. It had been pretty flat. And why we weren't running out of cash, we weren't growing the business that great. But once we released iTunes for Windows, that trajectory really started to change. And then that became the platform, if you will, for the iPhone and iOS. And so the company reinvented itself many times. You know, we used to be a computer company and then we were sort of this music player company. And then, of course, the phone company.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  26. “I'd say it was two things. One is having a strong, resilient, smart team that could really change with the times and move quickly to new forms of business was really, really important and having that flexibility, not being stuck in a single model, especially back then when it was sort of unclear exactly what the internet was and how it was going to monetize. I think the second thing that you learn in startups, and I actually see this in Apple, is a lot of success is based on great timing. And some of that's predictable and some of that's not predictable. But I think the timing of when these companies come to market, how they come to market and how quickly they invest can make a huge determinant in the success of a business.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  27. “It truly was, I think, the beginning of the commercial internet, certainly not the technical internet, but the commercial internet. And a lot of things were emerging at that time, the search business, Yahoo formed in those early years, Infoseeq was another one of the search companies, and then certainly a few years after that came Google. And so it was an incredible time where so much formulation was happening around this crazy thing called the internet. The company, if you ask like what it was like to work there, you know, it was a bit chaotic like most startups, but it was a challenge in terms of finding, to your point, product market fit with a revenue model, because as you know, the internet emerged and browsers emerged to be something that needed to be free. And that was our primary business model at the time. was in the days where we were”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  28. “One of the things I loved about what I did in my early career is I was in a lot of early stage companies. Some of them were successful and some of them were not. And I would say you learn from both, both the success as well as the failure. And even when I look for hiring people today, I love to see them having come from early stage companies because they sort of understand what it takes.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source

  29. “Really goes back to my childhood because I moved to Silicon Valley when I was six and my dad was in the semiconductor industry. So everyone we knew were pretty much in that phase of technology in Silicon Valley. And so when I went off to college, I started with math, computer science, and my first job out of college was, as you noted, a software engineer. It was a fantastic grounding and really exciting time to be in the industry back then.”

    2024-10-22 · a16z Podcast · The Story of Apple Pay with Jennifer Bailey · IDENTIFIED FROM THE TRANSCRIPT · source