Aldo is a true entrepreneur at heart. He has founded numerous companies and not one of them was motivated by money- it was always to solve a problem. Listen was he shares his journey and talks about Veem, his disruptive new company geared at changing how people make cross border payments around the world.
Alan: Welcome back, I'm here today with Aldo Carrascoso and he's the founder and COO of Align Commerce. Welcome to today's show.
Aldo: Thanks for having me.
Alan: Well, truly, you're a serial entrepreneur. That may be a more accurate depiction of what you do, but I love having you on today. Thanks for coming on. For the listeners, can you give us a background of how you got to where you are today and some of the things you've done along the way?
Aldo: Perfect, yeah. Before we move forward, we were formerly known as Align Commerce, we just rebranded less than a week ago, to Veem. It's the same business, just a new name. Veem, it's just easier.
Aldo: My journey, I was born in the Philippines in a place called San Juan Metro Manila. I was born in a family that was tech focused. I was engaged in coding in third grade. I destroyed and created my first television set in fourth grade. Then I created my first radio in fifth grade. My folks encouraged to seek forgiveness rather than permission. I could innovate that as a child. I think the basics of coding was really ingrained then. Then I went in to University, I had conversations with people about the best things for me to do, take, or focus on. I wanted to contribute back, some way, into the world, because I grew up in that type of family. I was told the key to any business is not really the numbers, CPA's might disagree with me or financial forecasters. They said it's not really logistics or operations, it's people. The ability to grow, motivate, or propel people forward are the most important things. That's what I spent my entire college life doing, understanding how to talk, motivate, and grow people, which I think are the main core tenets of what I know. Aside for the fact that I'm also a technical founder, so I code. Fast forward a number of years, my journey to Silicon Valley started in a parking lot in the Philippines. I said, one day, I'm going to go pitch to some of the largest investors in the world and I'm going to create a really disruptive tech product. The rest is history. I moved here around 2004-2005. It was very hard to break in. I came from a completely southeast Asian mindset, more laidback, less asking questions, less about questioning authority, more about following orders. I had to reprogram myself. I joined the Babson entrepreneurship program, I took an MBA. Two things it did for me. One, it forged me and exposed me to mentors who were in theorists, they were people who exited and ran giant companies, like Craig Benson, Ed Marram. They were able to run companies and they were the ones teaching. The other one was that I was able to launch my first startup. That whole experience, aside from giving me US education, allowed me to get my feet wet. I started a company called Verego. Think of Verego as a tinder for companies. Tinder matches people based on preferences or likes, long walks on the beach, moonlight dates, I did the same thing, but for B2B. Verego was a pioneer trying to do B2B matchmaking! If you were a US company and looking for partners outside southeast Asia, China, India, I wouldn't just give you a listing, that's what directories would do, I would give you the best matches for you. That became something called the OPI algorithm, a match making algorithm for businesses to use each other. That became successful and now a consulting firm uses it to do buyer-supplier matching. To this day, I believe some of the companies that we matched, are still partners. The big vision is personifying companies, it allows you to have longer strategic partnerships, just like relationships and marriage.
Alan: Although you are the epitome of that entrepreneur that's out there to solve problems, not to make money, to find ways the market isn't addressing to put the technology and the resources in place. You've done a number of companies, and I want to get into this, but unfortunately, I'm running up against the break right now. If we could, why don't we take a quick commercial break and then we will continue with some of the other companies that you've done and then bring you up to date. This is Alan Olsen's American Dreams. I'm visiting here today with Aldo Carrascoso, he is one of the founders and COO of Veem. We will be right back after these messages.
Alan: Welcome back. I'm visiting here today with Aldo Carrascoso, he is the COO, Chief Operating Officer, of Veem. Before that, we were talking about your first company you founded, Verego. Which was a B2B, similar to tinder for businesses. Where did you go on from there?
Aldo: After a few years, I was able to exit from my company. I went to Los Angeles, one of my main passions was movies. I love them, I think it's a way for me to vicariously live through the hero or even the villain. People often ask me how I train my imagination. I tell them, when I watch a movie, I imagine myself in the situation. What will I do? Some of my craziest ideas come from movies. What I would have done in the situation of the plot. I moved there and met two producers. They were telling me about this viral video content, this was 2009-2010. I wasn't even known. If you were some normal kid and you had some compelling thing you would like to show on TV, you would need to show up in a station, give them a DVD, and then they would do a content meeting. They would find out if they wanted to put you on TV, because you caught something. If they did, you would have to give them the raw file. There is this infamous story, and I won't name names, but apparently, there is this gentleman from the Midwest that filmed something compelling. He licensed it for anywhere between $100-$1,000 to a network. The network went on and monetized it for a lot more money. When we started it, we found there was this huge disconnect between people who needed the content and people creating the content. The two producers knew who was producing them and who needed them. They just needed a guy to create the platform. That became Jukin Media, Jukin is now one of the world's largest payments, licensing platforms for user-generated content. I always asked this to people, do you have Facebook? Do you have Instagram? I probably made you laugh already, we provide a tremendous number of funny videos, viral videos for all of these platforms. I think the platform itself has over 60 or 70 billion views. It's in 221 markets, I don't even know how many regional offices we already have right now. Every major network in the world, from CNN to Aljazeera to CCTV to GMA in the world uses that platform to get users their content. The brands that we found, some of them include fail army, people are awesome, petcollectins, and a number of other things. If you are actually looking at what we've done eventually I think contributed around 10 or 15 million dollars back to these video creators. All it is is a platform for them to upload stuff and once it's there, the platform syndicates, it licenses and it distributes to all of these networks. We really wanted to help these people that were creating all this content because they didn't know how to negotiate. You don't want to go into some executive's room and have the executive show you $100. Wow, $100 for a kid in the Midwest, who's in high school, that's a lot of money. We were able to democratize that process. And at the same time, every major network in the world from Japan, Germany, to different countries, could have access to these real time compelling videos. If you are thinking of a viral video right now, it's probably from the Jukin platform. That became one of the interesting tidbits of my life.
Alan: It's interesting, after Jukin, you didn't stop there. What brought you to the new Veem?
Aldo: Essentially, I am technically called an overseas, foreign worker. Always with a problem, remember, we never started anything because we wanted to make money. Unfortunately, I listened to a lot of pitches and when you listen to all of these entrepreneurs coming in, it's about them making money. My advice to them is it's always about adding value to people's lives. Back to my story, in Veem, Align Commerce then, I'm an overseas foreign worker. That technically means I send money back home. I support people and that's what 30 or 40 billion dollars worth of remittances go in to the Philippines alone. The Philippines is one of the smallest markets for remittances, look at Mexico, look at India, look at China. People kept complaining, how come you are sending me only this money. Absolutely not, I'm not just sending you that money, I'm sending you much more. Fast forward, back of the envelope no excel, I found out that they were getting 80% of what I was sending them. 80.
Alan: Who was getting 80? 20% was missing?
Aldo: The receiver. I was paying a sending fee and for receiving, they were paying a receiving fee and they were getting net of something. I found out it was because of one thing, it could either be the closed-loop networks, of large institutions, which will remain nameless. Or because of correspondent banking. Correspondent banking essentially, banks internationally aren't connected. They are connected by swift, which is a messaging platform. In terms of how money transfers flow between them, they need to be connecting by corresponding banks. They don't have the direct relationships. By virtue of that, every time you need to send US dollars. For example, I am a Philippine company and I need to send to China, the Philippine company will correspond with a bank in New York. The bank in New York will look for a relationship somewhere in Asia to find how to route the money to China. That's how many hops, maybe 3 or 4. Just by human nature, and maybe by laws of economics, every time you hop on something, it costs something. It's just like going through a toll gate. No one has questioned that for the longest time, it's always been the whole system. Free internet, the whole wire system was created by Western Union back in the 1900s. It hasn't been redone.
Alan: Aldo, we are running up against the break. I need to take a quick break. I'm visiting with Aldo Carrascoso, he is the Chief Operating Officer of Align Commerce, recently renamed to Veem. We will be right back after these messages.
Alan: Welcome back, I'm visiting here today with Aldo Carrascoso. He is the Chief Operating Officer of Veem. We are talking about this new company that was actually filling one of the problems out there between sending money overseas and making a more efficient process. That way more money ends up getting in the hands of the recipient. Go ahead.
Aldo: We left off with the old wire system created by Western Union, which hasn't been changed. Fast forward to 2009, 2011, 2012, there is this thing called bitcoin. And if you googled it at that time, you would hear about drug trade, FBI shutting down operations, murder, all these things. When my cofounder and I started it, imagine the horror when we would explain it to a regulator, or to a bank. It actually took us many months to get a single bank account, can you imagine that? Now, after you incorporate, you go to Bank of America and they give you a bank account. It took us so much time to get that. The whole mountain of things that we had to go after because it was too early, no one knew the idea. We weren't pitching bitcoin, we were pitching something called the blockchain. We were the first, that's why we are the world's largest payment processor on the blockchain right now. We were the first. Four or five years ago, no one heard about this new thing, which could be the best thing to connect banks. We created this thing called the multi-rail router. Instead of going from banks that use swift to tell each other they are sending money, which is what swift is, it's a messaging system. It essentially does something called a rebalancing, Vostro account. Banks have bank accounts in other banks. They just subtract and add, they rebalance credit and debit these things. What the blockchain would allow is for banks to have a real-time exchange of transfers, disintermediating this need for treasury or balances in other banks. Imagine me telling this to someone 4 or 5 years ago, fast forward now, every major bank in the world is investing billions of dollars trying to form a consortia, trying to understand this new thing. The same guys who probably laughed at us, are the same guys calling us back. I've spent maybe the last year talking to banks, educating them, telling them about proof of concept on these things because Veem is not a proof of concept company. You hear blockchain being proof of concept, we are not. They want to find out how to bring something that's operational and that's scale-able. You have all of these guys calling us back, that in fact, we've hit a nerve that they've started investing in us. Silicon Valley bank, National Australia bank, are some of our lead investors aside from Kleiner Perkins and Google Ventures. We are probably doing the right thing at this point. The rest is history, now we have expanded to 60 countries, we will be one of the first to actually allow you to remit money out of China. For us in the United States, that might not seem to be a big thing, but in China, there are huge capital controls. It is almost impossible to expatriate funds out. Again, this is not supposed to be a political commentary, but it is almost impossible. We are one of the first foreign companies to be able to do that. Imagine the excitement of the Chinese market for us to do that, all possible because of this new multi-rail router that we did. Basically, that we patented, and all it does is it routes money depending on the highway. If I want to get to Sacramento, I can fly, I can take the highway, and I can take the train. My router just chooses one. You want the quickest, the safest, or the cheapest? The algorithm finds out which one is the most efficient.
Alan: It's amazing the solution you found, but how do you make money of this? What's your model here?
Aldo: Cross-currency, that's all it is. It's actually free to send, free to receive. We target only small and medium businesses. SMEs, underserved, underfunded, nobody cares.
Alan: What is a typical transaction size?
Aldo: Anywhere from $1,000 to $10,000.
Alan: The person wanting to send money home, how can they?
Aldo: We power those platforms, the only way you can use the Veem platform is if you are going to use it for a good or service. We don't use it to remit personal. We are a regulated entity, so we have an MSB, money service business registration and everything. We are going after money transmission licenses in the states. We probably have a dozen right now. They are being granted as it goes. We have to be very careful for something called KYC or know your customer. We need to make sure that money laundering and all those nice things aren't happening. This is my first regulated entity. It is actually very interesting, it's also frustrating at times. For me to explain to a regulator what the blockchain is, I spend a lot of time doing that.
Alan: That's a big area too, money laundering in today's world.
Aldo: Especially with digital currency, it's actually so simple. That's what scares me, they don't understand how simple it is, but then people like us at Veem put in compliance as one of our cores. At least we protect the consumers, we make the regulators happy, then we protect your funds. That's probably one of the most important things. It's really a very mature approach. I think one of the big problems with early blockchain companies is what they wanted to was stick it to man, which was probably not the best thing to do at this point. For us, we did the reverse, we said we need to work. We need to work with institutions because we need legitimacy. I believe in revolutionary about some things, but then you have to be prudent, pragmatic, and you need to execute. We work on these kinds of things.
Alan: Aldo, I understand you are also looking in to doing more things with artificial intelligence. However, I'm running up against the break right now and I have one other segment after and I would like to hold you over if that's okay?
Aldo: No worries.
Alan: I'm visiting here today with Aldo Carrascoso and we have been visiting about a new company he cofounded, Veem. He is currently the Chief Operating Officer, but he is moving to the next big idea, artificial intelligence. Stay tuned, we will be right back after these messages.
Alan: Welcome back, I'm visiting here today with Aldo Carrascoso. In the previous segment, we were talking about Veem and how that's disrupting and providing solutions to cross-ported transactions in currencies. You are now moving in to artificial intelligence, do you want to share with us the direction you are going and how you think that can help us?
Aldo: I think one of the most important things that's always guided forward was never money, it was always about the purpose. Why you do something is more important because when you have a very compelling reason why you are doing something, people follow. Not just employees, investors, media, stakeholders follow. Purpose has always been important, for Jukin to empower the small guy. For Align, they empowered the small guy again. It was always about these things, so you found people to believe in you. This whole artificial intelligence conversation started because of cancer. My mother succumbed to cancer as a child, she had breast cancer. Just recently, over a year and a half ago, my sister, who I loved dearly, was diagnosed with breast cancer. I'm sorry for letting people know, but people need to know this reality. The last time I got mad, I started a company called Veem. I got so mad that there was no cure for cancer. I realize it's a confluence of things. First of all, all of these scientists generate tremendous amounts of data from the human body. I found out that 70-90% of it is thrown away. Why would you throw away that much data? Because they don't understand what to do with it. Second, preparation for these samples when you find the cancer tumors is so manual. It's prone to human error. It needs to go through instruments rather than human hands, less intervention, better accuracy and precision. The third one was that they are based on RNA and DNA. What is the thing about RNA and DNA? Scientist have found that it may be too noisy, but these is a ground-breaking resource right now that is not protein based, but carbohydrate based. What does artificial intelligence have to do with that? The human body, as I said, generates petabytes of data. The only reason why we haven't had a cure for cancer or for breast cancer, was because we couldn't find specific markers that would allow the tie in the similarities of all human beings. But a machine would do. You could train a machine enough to find these markers, one that cannot be seen by the human eye, because machines are unbiased. I'm working right now on a cancer target discovery factory. It's going to run on machine learning and artificial intelligence. We generate all this human data, petabytes of it instead of going through a normal statistical method, it's going to go through a machine learning model that's going to find out new signals, new structures. These new signals and structures were never discovered before and they will be glycan or carbohydrate based. I've been circulating this around a long time with the scientist community, the medical community, and investment community, the response is the most tremendous I've ever had with anything I've ever done. I remember the blockchain when I was pitching it 4 or 5 years ago, when no one believed me. Now I'm pitching artificial intelligence for healthcare and I'm telling them it's the same thing replaying again and I'm seeing that AI is going to impact healthcare significantly, improving people's lives. More than it is financial services, more than it is talking to Alexa or Siri. I've had 20 years of experience as an entrepreneur and the one thing I don't want to do is boil the ocean or make gigantic claims, but I think this is the key to really providing a scale-able solution to battling breast cancer.
Alan: Absolutely amazing. We are out of time today, but I appreciate you being on today's show. I've been visiting here today with Aldo Carrascoso and thanks for joining us here on American Dreams. Join us next week right here on this station.