It all started when 32-year old Hiroki Takeuchi, then a freshman at Oxford University, got dragged along to an event in his first week of university.
A student in the year above corralled Takeuchi, who had just started studying Mathematics, into attending a gathering of the Oxford Entrepreneurs in 2004.
“There wasn’t really like a tech scene in the UK,” Takeuchi told Business Insider. His awareness of tech startups was basically nil, but his experience at the Oxford Entrepreneurs event sparked an interest in starting a company.
“It was through that society that I kind of got quite involved, learnt all about startups in general, but also in particular tech startups,” he told Business Insider.
Takeuchi’s journey towards becoming a founder took off when in the summer following his first year, he managed to swing an internship with a programme which had little to no profile in the UK — Y Combinator.
Y Combinator to GoCardless
Two of Takeuchi’s friends, brothers Harjeet (Harj) and Kulveer Taggar, went out to Silicon Valley in 2007 to join Y Combinator, a startup incubator famous for producing prodigies such as Airbnb, Dropbox, and Twitch.
Harj and Kulveer were setting up a company called Boso, a student marketplace. “It was like eBay for students,” Takeuchi said, and luckily he talked his friends into letting him come along for the ride as an intern.
While in the Valley, Harj and Kulveer ended up clubbing together with Patrick and John Collinson — who would go on to found payment company Stripe — on a new company called Auctomatic, a super-niche inventory management system for eBay power sellers (people who sell high volumes of items on eBay).
Takeuchi interned for a summer, doing odd jobs and learning about how tech startups work. “I was just doing loads of random stuff,” he said, adding that all of them were learning on the fly. “They were building this product that none of them had ever used before, none of them were eBay power sellers.”
He recalled that, at one point, the group bought a bunch of lasers from China to sell on eBay to gauge how their product was working. After that summer of odd jobs and lasers, he knew what he wanted to do.
“I got the startup bug,” he says.
Chance encounters with the GoCardless founders
After graduating from Oxford, Takeuchi didn’t feel he was quite ready to found his own company — so he took a placement at consultancy firm McKinsey. He picked the placement specifically because after two years, McKinsey would shove him out the nest.
In his first week at McKinsey he met his future cofounder: Matt Robinson. “We immediately hit it off, ” he remembers. “Through the whole of that [time] we would think about various ideas and brainstorm things on whiteboards and all that sort of stuff — ultimately none of it came to anything.”
When the time came to leave McKinsey the pair knew they wanted to work together, but they ended up roping in another cofounder — Tom Blomfield, the CEO of unicorn fintech Monzo.
Blomfield had been in the year above Takeuchi at Oxford. Blomfield was a cofounder of Boso with Harj and Kulveer Taggar, but had been on a year abroad in Paris so his and Takeuchi’s paths came close but never crossed.
By strange coincidence, however, Blomfield was just due to start at McKinsey as Takeuchi and Robinson were getting kicked out and setting up shop. Lucky for them, Blomfield was moving between consultancy jobs and so had a few months of gardening leave.
“If you know Tom, you know it doesn’t take long to realise there’s no way the guy’s going to take three months of gardening leave,” Takeuchi says.
Blomfield never started at McKinsey, and Takeuchi is acutely aware of the interwovenness of GoCardless’ origins. “It’s all weirdly connected,” he laughs.
The trio started work on what was then an idea for a group-payments startup, and Takeuchi’s knowledge of Y-Combinator proved a massive advantage for the fledgeling firm. “I remember when Tom and I were first starting out and I said, ‘it’s a no brainer, we’re doing YC,’ and they were like ‘what’s YC,'” he says.
In 2011 GoCardless was born, a startup focussing on building tech to ease recurring payments between businesses. Takeuchi still vividly remembers his first fundraise, which he managed at the age of 24.
“The first fundraise was super hard,” he says. How did they pull it off? “A lot of mistakes and persistence,” he says, chuckling. Since that first raise, GoCardless has secured $122 million of investment, $75 million of which came in February.
“It always comes down to momentum… especially [in] the last 10 years it’s so cheap to go and start something. You can go and spin up servers with AWS at almost zero cost. With the click of a few buttons you can write code and build products that can go and be used by… millions of people from your bedroom,” he says.
Both his cofounders have now left, leaving Hiroki at the helm of GoCardless. Matt Robinson departed in 2015 and now heads up home sale startup Nested, while Blomfield left in 2013 and now runs Monzo.
Takeuchi describes the breakup as amciable. “I don’t think [Blomfield] wanted to ever be involved in a B2B company. When we started GoCardless, we weren’t aware enough of what we were doing to really realise what we’re building,” he explains.
He also says Blomfield talked to him about Monzo while they were still starting GoCardless. “We were like, retail banking sucks, there must be a better way to do this.”
Takeuchi radiates pride that Robinson and Blomfield have branched out an set up their own companies. “That’s one of the coolest things about it all,” he said.
He speaks highly of Monzo. “In 10, 15, 20 years, what bank is not going to be a technology company? I think there’s going to be a fundamental shift, and I think Monzo are doing a great job of leading the way with that.”
A catastrophic accident
Since GoCardless was founded in 2011, British fintech has exploded. “I feel like I’ve been really lucky to be part of that,” Takeuchi says. “We ended up raising money mainly from Europen investors, but it was through learnings in America that we were able to go and do that. That, and a lot of rejection.”
GoCardless’ recent $75 million raise, included backing from GV (previously Google Ventures), Salesforce, and Adam Street Partners.
This was GoCardless’ first raise following a life-changing event for Takeuchi. In September 2016, the founder was left paralysed after a cycling accident. He now uses a wheelchair, and was back to work just six months after the accident.
Takeuchi prefers not to dwell on the accident or his recovery during his interview with Business Insider. He told TechCrunch’s Steve O’Hear in 2017 that he occasionally has flashbacks to the accident but, for the most part, he doesn’t remember it.
At the time, he told O’Hear that he was dialling into board meetings just 24 hours after major surgery. Told by doctors it would take him six-to-12 months to complete a rehab programme, Takeuchi did the job in just seven weeks. He gave a speech at the GoCardless Christmas party in December 2016, just two months after the accident.
Along with its latest fundraise, GoCardless also announced it’s been working on a system facilitating international recurring payments. Takeuchi says the company has been working on it for a few years, stitching together all the different financial systems across different countries.
“It’s clearly not done, there’s hundreds of countries around the world and each one has different systems, but by the middle of this year we’ll cover about 70% of the global recurring payment volume,” he says.
The shadow of Brexit
While GoCardless has been busy stitching together a global payments system, its been having to allow for major political upheaval which could radically change financial systems in the UK.
Brexit has forced GoCardless’ development teams to make technical provisions for all the potential outcomes, and Takeuchi said they’ve had to make “drastic changes” on the backend.
“It’s been frustrating because we’ve had to divert resources and investments into doing things that I hope will have been a complete waste of time, but we’ve taken the approach of saying — no matter what happens, even if we crash out at the end of this month, we need to be in a position where we can support our customers without there being any kind of blip in the service,” he explains.
“If we crash out then all financial services companies don’t know what’s going to happen with passporting and financial regulation. We assume we won’t be able to passport anymore, [but] who the f–k knows,” he says.
“Brexit will end up being a missed opportunity for London and the UK more broadly,” Takeuchi adds. “It’s not gonna shrink [the London tech scene] because there’s just too many companies growing very fast that are not likely to move out of London. What worries me for the London ecosystem is more the next companies — will they start in London or will they go somewhere else?”
He says that he’s already starting to see an impact on recruitment for GoCardless, as European hires are becoming more difficult to convince. People are apprehensive about taking up a job in Britain. That’s a problem when half of your product developers come from Europe.
“It’s potentially a lot harder to scale up big product development teams in London when so much of the talent has historically come from across Europe,” he says.
Frustrated though he is by Brexit, Takeuchi doesn’t seem daunted. He says engineers have always been tough to hire, “but we’re quite good at it.” Takeuchi has come a long way since those early days in Oxford.