Commerce Conversations

The Trailblazer's Path with Pete Kight (CheckFree)

Episode Summary

Pete Kight is a founder unlike any other. After dropping out of college, Pete started running a chain of gyms and after spending time with a few banker friends his eyes opened to the promise of the newly rolled out ACH method for payments. Mind you, this was in the mid 70s, when the foundations of the internet were only just being built. Dan and Pete discuss the journey of bootstrapping a business and the determination it takes to see it through to a close.

Episode Notes

Episode Highlights:

Pete grew up in Ohio with 4 other siblings with a serious amount energy, which we later found out was ADD
Without a diagnosis, Pete knew that his energy and intention meant he wouldn’t be a great employees, but entrepreneurship could be channel to funnel his drive at his own pace.
Pete dropped out of college with just a quarter to complete and ended up running a chain of gyms. After spending time with some bankers he became aware of ACH that they were using to collect monthly life insurance payment
I was talking to banks about accessing ACH, and a banker took pity on me by sharing Regulation E. I read it and saw it didn’t explicitly say non-banks could use ACH.
I used a local bank introduction in Columbus to access ACh, thanks to John McCoy. But it took me a little over a year to actually launch products. But in Columbus, Ohio you can’t hack out of a garage, it’s too cold! So Pete went to work with a single programmer and borrowed a computer from a local real estate company out of his grandmother's basement.
Pete capitalized the business after getting 250 VC introductions, getting 200 “nos” and 250 “hell nos.” It was his lawyer that suggested that insurance companies would understand the excitement for the product.
He eventually raised a 3M round with 4 insurance companies from Ohio.
The company went public in 1995.
Pete never wanted to take a company public, he just wanted to win.
Pete decided to sell the company after seeing the way banks were in way over their head.

About the Guest:

Peter Kight

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