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factors, and most were dial-up on dial-up lines. Melton saw this prefunding. What killed it was he didn't have good
that he needed to cut the cost to 10 cents per transaction. methods to do buyer authentication. He would have had
Jack McDonnell Jr., founder of TNS, came to Verifone to to go to the banks, but the banks knew the value of this
meet with Melton and told him he should invest in TNS, and were not willing to share anything. Today, you can
which he did, creating another success story. use Facebook to authenticate an identity online and don't
need authentication from the banks, Melton said.
Ecommerce frontier
Beyond payments
In 1995, Melton started CyberCash Inc., which created the
back-end technology for commerce over the Internet, and Now Melton is involved with OmnyPay Inc. (www.
later sold it to VeriSign Inc. Melton said that CyberCash omnypay.com). It was formed by two people he brought
was 10 years ahead of its time. He wanted to give into Verifone 30 years ago. The concept is to look at things
merchants access to using the Internet the same way he from the merchant's point of view. Now, merchants are
provided POS terminals at Verifone. going to do things that they couldn't do when the card
associations were owned by the member banks. Now,
He envisioned a PayPal-Blackberry-P2P model, but it banks will be going their own route. This is no longer
never took off. In 1995, there was only one method for about just payments, but about the entire relationship
monetizing small-dollar purchases on the Internet, with customers and their community.
a subscription model. Merchants could not get their
heads around the Internet, and the cost of new customer OmnyPay is building a set of technologies that will forge
acquisition was around $60 to $70. eBay Inc. solved the an ongoing deep relationship with the consumer, creating
problem of small non-traditional merchants selling on the a complete microenvironment where you are always
web, and their customer acquisition cost came down to $5. connected with the consumer. The merchant cloud and
the consumer smartphone will build an entire world.
In 2000, CyberCash ran out of money, but meanwhile
PayPal Inc. took off. Bill said that he made $20 million Finally, a big part of Melton's contribution to society is his
on PayPal and lost $20 million on CyberCash; the only charity, The Melton Foundation, founded in 1991 (www.
difference was that he was actively involved in the meltonfoundation.org). Five universities, in the United States,
management of the latter. China, Chile, India and Germany select new fellows each
year. Today, about 20 to 25 students communicate year
CyberCash pioneered the idea of an electronic wallet. Back round and have an annual week-long symposium.
then, it was difficult to get direct access to a consumer's
bank account for automated clearing house debiting to To date, nearly 500 people have gone through the program.
pay for a transaction, so he had to preload it to have money Melton got the idea for it when he was driving in East
in the wallet. He used AOL for a subscription model to do Germany right after the wall came down and he had an
inspiration: while political systems and even institutions
fail from time to time, it is an "old boy's network" that
Snap Shot of 2017 pulls things together when everything else falls apart.
Calendar of Events
In the old days, membership in this network was the result
of privilege. It was not a meritocracy. He wanted to create
a global "new person's network" that is less sexist, is more
multicultural and includes a bonding college experience.
The fellows would provide continuity when institutions
cannot.

SEAA Annual Conference While it would be difficult to top the contribution to
March 20 - 22
http://www.southeastacquirers. society that Melton made with Verifone, in the long run,
I suspect the foundation will have an even more positive
com/registration.html and lasting effect on society, and for that we can all be
grateful.

May 10 - 12 Brandes Elitch, Director of Partner Acquisition for CrossCheck Inc., has
been a cash management practitioner for several Fortune 500 com-
www.electran.org panies, sold cash management services for major banks and served
http://www.greensheet.com/date- as a consultant to bankcard acquirers. A Certified Cash Manager
book.php?flag=calendar_display and Accredited ACH Professional, Brandes has a Master's in Business
Administration from New York University and a Juris Doctor from Santa
Clara University. He can be reached at brandese@cross-check.com.

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