Friday Interview: David Finn, founder and chief executive of AmaTech
AmaTech created the contactless payments industry but went bust in 2002: now it’s back
David Finn, chief executive and founder of AmaTech. Photograph: Joe O’Shaughnessy
At the age of 43, David Finn decided to pack in his working career. He’d invented the contactless payment system, started a company, floated it on the Frankfurt Stock Exchange, watched it fail, and lost all his money.
Having started a company with €25,000 and grown it to a valuation of €250 million, he found himself without a cent, having “to go to my wife for money”.
“I retired in 2002. I decided not to work any more. I went back to college. I did an MBA, an MSc and a PhD.”
AmaTech had been the name of his original company, and Finn convinced some former employees to return to the business.
Born in Dublin, Finn studied electronic engineering and telecommunications at DIT, before going on to work for Data Products in Coolock.
“The third year I was there, the unions went on strike and the company was being destroyed. No one was motivated. I decided to get out of the country and go to Germany. I didn’t really speak German and I absolutely hated it there.”
He returned home after two years and went to study international marketing and languages at DCU.
“Then, hilariously, I went back to Data Products, and to show you how nutty I was, I did a degree in German and French at the same time by night.”
Several years later, he moved to Neuchâtal in Switzerland to work for Swatch, in its semiconductor division. It was here that he first got interested in radio frequency identification (RFID).
“Swatch at one stage brought out a Pop Swatch. People in the ski resorts wanted to be able to make payments. We worked with Ski Data, in Austria, to create a contactless watch for skiers.”
The RFID technology gave Finn an idea about animal identification, and in 1990 the German government in Munich asked if he wanted to set up a company and realise this idea.
“It involved putting a tiny transponder into glass and the glass was then injected into the skin of the animal. I knew about miniaturisation because of the watch industry.
“It didn’t work out as the industry didn’t want it. There was a lot of fraud going on. We were too early in the day with that technology.”
With his animal identification business on the verge of bankruptcy in the early 1990s, Finn came up with the idea for contactless cards, and AmaTech was born.
The company supplied RFID system components to plastic bank card manufacturers and other secure credential-document providers, such as national ID cards and passports. The products were used to securely authenticate the card and the card holder using this RFID technology.
AmaTech became a public company in 2000, when it was first listed on the Frankfurt Stock Exchange. At the time Finn was a 50 per cent owner. In the same year, it established overseas subsidiaries in Singapore, Britain and the US, and acquired NBS Card Services, a secure cards manufacturer.
In 2001, AmaTech entered the Polish market when it won the contactless card contract for the public transport system in Warsaw.
“We had the Korean, Brazilian, and North American markets. We were in Australia, Poland etc. We created the [contactless payment] industry. That was hard to swallow when it went under.
“That said, the company had become so large and impersonal, because we had almost 300 employees and were dictated by the stock market. It wasn’t as enjoyable”.
He set up Amatech version two in 2007, to make electronic passports, as the old company had done them. He began talking to former employees and they decided to come back to work for him.
Quickly they found out that the sector and changed, and it would be more profitable to make the machines that make electronic passports, rather than making the passports themselves.
“The market in electronic passports had changed since we did them and had moved on. We quickly learned the area of electronic passports is a difficult area to operate in. You have to tender, and the tendering process is expensive. We decided instead to make the machines that make the passports. Most of our revenues now come from them.”
AmaTech’s process has resulted in improvements to the quality, reliability and lifespan of an electronic inlay. In addition, the security of the electronic inlay has been increased, as it is now much more difficult to locate the wire and chip in the substrate.
The company has also come up with a unique solution to antennae design. With contactless payments, the debit card has to be physically held against the machine or in close proximity to it. This is because of the sensitivity and power capabilities of the antenna.
AmaTech has been able to use metal in the card to increase the power of the antenna. Taking this a step further means anything made of metal can become an antenna. Thus, almost any piece of metal jewellery, as long as it is of sufficient size, can become a payment object.
“Metal usually breaks the radio field. The real invention here is that it doesn’t. It’s because of a slit in the metal.”
He discovered the problem with using watches and phones for payments is that they need their own power source to do so. If your battery is dead your wallet dies with it, until you recharge it.
With AmaTech’s sytem, a standard wristwatch with a chip and antenna embedded in it can be become a contactless payment card with no need for a power source. The same applies to signet rings, charm bracelets and a range of other metal objects.
He has now created PayWear: technology that adds payment to jewellery. The company developed the first RFID transponder that works with and in solid metal, opening the door to adding contactless payment functionality to jewellery and other metal payment objects. The contactless payment functionality is capable of being added to everything from a Swarovski bracelet to a Fitbit exercise band.
“Taking something from zero and getting a whole load of individuals behind an idea that can change the world is exciting. The way we use jewellery will change in the future, especially if we use it for payment.”
The first AmaTech may have been all about contactless cards, but it would seem version two is focused on bringing contactless payments to watches and jewellery. What does Finn think are the secrets to his business success?
“You need to be able to work day and night. Things happen by chance, and you need a lot of luck, but you must put a lot of hours in too. In the old company I used to get up at 3am to ring the Japanese. I did a deal with the Japanese as a result.”
“Also, as well as making products, make the machine that makes the product. Everything is cheaper in the long run when you can control your own destiny.” CV Name: David Finn Position: Chief executive of AmaTech Age: 56 Lives: Mayo and Füssen, Germany. Family: Married with three children. Something that would surprise readers: I hike the Grand Canyon every year and have been doing so for the past 20 years. Something readers would expect: Every month I’m on a plane somewhere. At one time I was travelling 22 weeks of the year. The most boring people I ever met in my life, I met in first class.