Craig Drury, eMerchantPay CEO

Founded by a group of executives with backgrounds in banking, advertising, IT services and offshore trust and corporate administration, eMerchantPay has distinguished itself as an online payment gateway that emphasizes customer services, secure processing and a multitude of financial options.

Founded by a group of executives with backgrounds in banking, advertising, IT services and offshore trust and corporate administration, eMerchantPay has distinguished itself as an online payment gateway that emphasizes customer services, secure processing and a multitude of financial options. Based in the United Kingdom, the company exemplifies the new breed of biller: global, flexible, urbane and audacious enough to take on the needs of high-risk industries. AVN spoke recently with eMerchantPay CEO Craig Drury to get the inside 411 on one of the companies that makes online commerce possible.

What is the background of the company owners and executives?

We have a good mix of talent and experience within our owners and management team, from banking and accounting, to sales and technology. For example our CFO, Stephen Dickson, was formerly the global CFO for the likes of Deutsche Bank; our chairman, Jonas Reynisson, was an investment bank CEO by the age of 24. We also have an excellent middle-management team, who make the day-to-day operations run smoothly and my life easier (most days!). As for me—I guess you’d call me a serial entrepreneur, although I’m not a fan of labels. For many years after originally becoming self-employed, I put the title “Human Being” on my business card. It actually won me a few good deals!

eMerchantPay has emerged as a front runner in adult processing over the last couple of years. Is eMerchantPay classed as an IPSP? What are the products and services that you offer adult paysite owners? What set-up fees do you charge new customers?

eMP is registered as an IPSP, MSP, ISO and TPP—so I guess you could say we can offer most solutions the adult webmaster requires. We offer a range of processing services from direct merchant accounts, third-party billing, our own powerful gateway which is fully NATS integrated, extensive fraud scrubbing tools, billing support, hosted and direct integration—the list goes on. To answer the third part of your question, we have never charged upfront fees! We are not here to sting a new client up front, because we are confident our relationship will be long-lasting and give us both the opportunity to earn well along the way.

Do you work with both foreign and U.S. domestic banks?

Yes we actually work with U.S., European and offshore banks to provide the stability and flexibility required by our clients and to protect our portfolio. We have in fact just added two U.S. banks to our partnership program as part of our move into the U.S. We are currently in the process of setting up an L.A. office to provide a more efficient, time-zone-friendly and direct service to our American merchants, which will be managed by some well-known faces in the adult processing industry: Keith Hill, Isabel Robles and Nora Mhamedi, to name a few.

What is your opinion on fraud scrubbing?

This is an area I feel we excel in, something we know merchants have come to really appreciate over the last few years. It’s no secret fraud has hit many merchants, processors and banks during 2009, but the writing was on the wall and simply ignored by too many. At eMP we utilize a wide selection of third-party fraud-scrubbing tools, but we also invest heavily in our own proprietary technology. Our gateway has compiled 10 years of valuable transaction history; we have used this in conjunction with the talents of data-mining experts to analyze this mass of information. The results have been nothing short of amazing, allowing us to offer predictive analysis to all our clients with extremely beneficial results.

What are the biggest challenges you see facing the adult industry in 2010?

Compliance! Taking the ever-changing regulations within the card associations and banking sector, compliance is an issue that cannot be ignored. Many merchants saw themselves fall afoul of this in 2009, some losing their business due to failure to change. Fortunately, I can say this did not happen to any of our merchants, due to our risk team working proactively with our clients and banks, offering positive and useful assistance all the way.

Which sectors do you think will continue to do well? Which are not doing well and will never improve? What’s on the way up in your experience?

I believe in sticking to what I know best, so I’ll leave the million-dollar content questions to the content gurus—my only comment being that the same people who bought a niche will always to do so! Just as long as the niche product continues to satisfy the need, and the options to purchase are easy and efficient. What I can say we are seeing is an increase in dating, social networking and amateur-content-based sites. To cater to this, a wide variety of payment methods have become extremely important to maximize the conversion of as many visitors as possible. We have seen a change in the way consumers want to pay—the modern-day surfer seems to be moving away from the monthly subscription model—opting to pay for what they want, when they want it.

Do you have an opinion about the future use, acceptability and profitability of tube sites and other such social networking sites?

The latest generation of surfer is far more sexually aware than even my generation—they grew up with the internet as their source of education and stimulation, not their mother’s lingerie catalogues! Social networks (both mainstream and adult) provide quick and easy access to a plethora of content to whet almost any appetites. They offer access to content in so many formats: stills, pre-recorded video, direct chat, live cams, sometimes all the way through to “meeting” the content maker in person. I feel the future is very bright for these types of sites.

The credit crunch—how has this affected eMerchantPay?

The credit crunch has actually been a boom time for eMP—we took great advantage of our competitors’ nerves. We watched many of them decrease budgets, scale down their ambition and some even lay off staff. At eMP, on the other hand, we were confident in our plans, the market, and our ability to attract new business. So we were ideally positioned to take advantage, as our operations were well run and efficient. There is great benefit in doing things right in the first place—not once a recession bites! We have seen our turnover and profits rocket year-on-year for the last two years now. We have also quadrupled our staff levels to assure we can maintain the same quality of service for our new clients, and allow us to continually increase our capacity.

If the credit crunch continues to tighten, how will people pay for their adult content?

As mentioned earlier, alternate payment methods are becoming increasingly important and the credit crunch has played into this too. With many consumers failing to obtain credit cards these days, alternate payment methods have increasing opportunity to take a share of the market. That said, the adult industry is still seeing growth, so I guess the crunch has made a few more consumers sign up for some porn to liven up their more frequent nights in!

So what’s in store for Craig Drury and eMerchantPay during 2010?

I feel we at eMP are now ideally positioned to be a dominant force in the online billing arena. The last two years, seeing growth coupled with control, have helped us secure our foundations. 2010 will see us continuing to invest in technology and people and we will continue to build our product offering and brand awareness. Working closely with our clients will continue to pay dividends, and I praise our customer service team, who I feel are unrivaled in this arena right now. As for myself, who can say what’s ’round the corner? But personally, I like simple things in life and spend most of my free time with my family—nothing better than walking in the forest with my three sons (one of whom is an 80-pound boxer dog, but that’s another story!)

This article originally appeared in the January 2010 issue of AVN.

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