Philip Beck, 48, still remembers the scorecard his housemaster gave him at his North London school. "He will have limited success in life." "I don't know if that was their way of encouraging me to work harder," says the jeweller's son. "But based on that, I decided I was going to go to law school and become a solicitor, just to prove them wrong."
Beck did just that, studying at Queen Mary, University of London. He qualified and joined a West End firm in 1984, before moving to New York, where he practised as a corporate lawyer until the late 1990s. But he was itching to run his own firm. "There's a difference between helping other people execute their plan and vision and having your own."
By 1999, Beck had worked on business plans for a wide range of companies, from start-ups to large corporates. He noticed that firms with cross-border businesses, which were on the rise as the advent of the internet made it easier for customers to buy products globally, were having problems accepting multi-currency credit-card payments. So an online pet store in New York was having trouble getting payment from a customer, say, in Singapore. Having worked with several dotcoms, Beck realised he knew as much about the problem, "if not more", than anyone else. So he decided to come up with a solution.
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That year, Beck quit the law and raised about $100,000 from "everyone I knew within a ten-mile radius of my house on Long Island". He recruited some of his old law firm's staff in the British Virgin Islands as a back-office team and then signed a revenue-sharing deal with an e-commerce firm, and white-labelled their payment-processing product. A team of software engineers then began working on how to process different currencies across borders. "Our first client went live in November 1999, a company called Jennifer Ann lingerie in New Zealand. She wanted to sell her knickers around Australia and Hong Kong, but wanted to be able to sell in US dollars rather than NZ dollars. So we helped her do that."
In February 2000, the group was set to do an institutional fund raising at $8 a share. Then the dotcom bubble burst. Beck got a call the next day "from the broker, saying they had one offer of $5m at $5.50 a share, did I want it. It took us about three seconds to say yes. The market then dropped 40%. That was our seed money, that $5m."
With hindsight, "we should have realised there wasn't enough activity for these dotcoms", says Beck. He began changing the group's model from working with merchants to working directly with banks. This meant getting banks to persuade clients to use Planet Payment's card-processing services. In return, the banks get a share of the transaction fees.
It worked, and by 2005 the firm was turning over $1.5m. In 2006, it listed on Aim, and last year sales grew to £18m as a pipeline of merchants began to come on stream. In the first half of this year, sales are at $14m and Beck believes the credit crunch may even help Planet, as banks seek to outsource more activities. "It just goes to show," he says, "you can't believe everything your teachers tell you."
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