Regulatory forces can create business opportunities and this was exactly the case for Sherif Mohamed in the run up to October 2015. The major credit card issuers in the US – Europay, Mastercard, and Visa – had set October 1, 2015 as the deadline for merchants to be credit card chip reader compliant. The liability for fraudulent transactions involving magnetic stripe cards would from that point on fall on banks or businesses. As merchants scrambled to upgrade their equipment, the demand for POS terminals skyrocketed.
Sherif saw this as his big opportunity to transition out of the corporate world. He had spent 15 years working for majors, like Microsoft, developing their operations in Europe and the Middle East, while his last position with Intuit exposed him to the world of payment processing which made him aware of the imminent regulatory change. CardMachineOutlet.com was born in 2013 in a suburban Dallas home to meet the insatiable need of merchants for new POS devices. The value proposition was simple: get your chip-reading POS at a fraction of the price offered by your local bank. It took off.
In the early days with Sherif still working full time, his wife was helping with customer support and logistics while juggling their newborn. They built his store on Shopify and by the end of their first year Sherif had 3 employees on payroll, an office, and a salary.
For Sherif it has always been about the entrepreneurial thing. He had the grit and coupled with the hard, global corporate experience that allowed him to grasp the opportunity at hand. Online commerce was not just another medium to reach consumers, it was the actual business opportunity and success lay in understanding technology. He had to put in place the right tech-driven business architecture that would propel him to scale and why not, scale globally.
Inventory management and fulfillment was a case in point. Manual processing and order fulfillment by a handful of people led to inefficiencies and a subpar customer experience. Merchandise stock levels were not automatically synchronized with marketplaces like Amazon and Walmart and often the information listed was not accurate which led to stock outs. Driving high volume e-commerce sales required end-to-end integrations; real-time, almost prescient, data flow from the wholesaler or manufacturer to the consumer and back again. That’s what a tech-driven business architecture was all about and it was Sherif’s natural propensity for structure that allowed him to lay the bricks in place.
Sherif turned to Storfund in mid-2019. His platform, now called Digital Shopper, had evolved into a multi-channel, global e-commerce business relying on cloud-based architecture for all essential tasks (repricing, listings, fulfillment). With a presence in 10 countries and offices in Dallas and Amsterdam, they were selling on Amazon, Walmart, and eBay and many other online channels. The business was growing but faster access to Amazon’s payouts would help them scale faster. As Sherif said, he was finetuning a well-oiled engine and just needed to pump the gas faster to drive Digital Shopper further. Access to daily cash flow would enable purchasing more inventory and publishing a larger product catalog on Amazon Canada, US, and Europe.
Sherif was looking for an architecture similar to the one he had with his suppliers; the solution had to be robust, seamless, real-time accurate, and global. He was prepared to stay with Amazon’s payment terms rather than risk partnering with someone he was not confident with. It was not just about shortening his cash cycle, Sherif was looking for someone to scale his success.
Storfund’s modular architecture allowed Sherif to onboard the Canadian marketplace first and as his confidence grew to add more marketplaces. The cash flow predictability that comes with Storfund’s next day payments helped Digital Shopper double their sales volumes. Months later, when we sat down on opposite continents to write this case study, I asked him what made Storfund stand out. According to Sherif, “today’s sellers have to think globally. The worldwide coverage was huge for us. Digital Shopper can grow because Storfund covers us on 14 Amazon marketplaces as well as on Cdiscount. Also, our savings on the exchange rate have been in the tens of thousands. Storfund allows us to circumvent Amazon’s conversion cost. And yes, next day payments are always important”.
Sherif believes that if he is going to write the next chapter on e-commerce he has to be where knowledge resides. Last year he started teaching a graduate course on web analytics at the University of Texas, Dallas. By giving his students access to Digital Shopper’s Google Ads account, they can experiment with real data and gage the impact of their decisions. Digital Shopper currently collaborates with both the University and Appian, a leader in robotic process automation, to fully automate e-commerce order fulfillment. They are working on how to program a ‘robot’ to generate purchase orders from suppliers by extracting information from emails received by consumers, consolidating this into a new file and processing the orders with minimal human involvement.
Entrepreneurship is not about the promise of riches; Entrepreneurship for Sherif is all about, how technological creativity spurs economic success and transforms societies around the world. Sherif Mohamed is a practitioner of this art form.