The Utah kid who imagined a cashless world: The origins of Visa

In May 2019, the real estate agency California Outdoor Properties added a luxury property to its portfolio for $6.4 million. It was a luxury ranch located in Pescadero, a small town on the California coast with fewer than 1,000 inhabitants. The plot covered 75 acres of wooded land, three catfish ponds, a stream surrounded by willows, green fields stretching to the horizon, and a majestic European-style house crowned by a terraced tower. The property boasts four bedrooms with panoramic windows, six bathrooms, a library, and an office. It was the house where Dee Hock lived for over twenty years when she decided to live a quieter life. Perhaps this name doesn't mean anything to you, but it's the reason why you carry a credit or debit card with a specific logo in your wallet today: Visa. Who was he, and how did he create this global financial giant?

"In 1984, I severed all ties with the corporate world to lead a life of seclusion: I traded money for time, freedom, and fulfillment," the tycoon admitted in his induction speech. Living in a Tuscan-inspired ranch was the reward he claimed for dedicating his entire life to growing his company.

Today, along with Mastercard, Visa is one of the world's leading digital payments companies. It operates in more than 200 countries, has agreements with 14,500 financial institutions, and controls 4.5 billion credit and debit cards, which move almost $300 billion each year, according to the company.

A man with credit

Dee Hock was born in 1929 in Utah, the son of an electrician and a homemaker. Thanks to a $50 scholarship, he was able to study at Weber State University. At 20, he was already behind the counter of a financial branch and eventually managed two branches of Pacific Finance. He was also the general manager of Columbia Investment Company and a senior official at CIT Financial.

In parallel, credit cards had been gaining ground. He hadn't invented them, but he had followed their development closely. By the 1940s, restaurant chains, businesses, and companies were already using them. Each had its own card and could only be used in the network of establishments they managed. At the time, it was a system that raised many eyebrows among financial institutions, which had been involved in several cases of card-related fraud. One of the banks that bet the most heavily on cards was Bank of America, which launched BankAmericard in 1958. It was the first mass-market credit card in the United States, allowing users to pay on credit and repay their debt in installments. Initially, it suffered heavy losses due to fraud and defaults.

But things turned around when Dee Hock knocked on the bank's door and convinced them to take over leadership of the program. The strategy for its revival consisted of creating a new company, separate from the bank: it was clear to him that the key to the cards' success was universality. "In 1969, he gathered a group of bankers in a hotel and rethought the project," recalled Alfred F. Kelly Jr., CEO of Visa, in a piece about Hock. "He imagined a world where trade could be frictionless: between anyone, anywhere, anytime, and in any currency," the piece continued. The meeting with the bankers led to the creation of National BankAmericard Inc., formed by Bank of America and several licensed banks that wanted to incorporate the credit card into their catalog of services.

In 1976, it became Visa and began operating in several countries. With efforts to improve fraud detection and the creation of the debit card in 1975, the system took root among consumers. In 1984, with the work completed, he retired to the Pescadero ranch, from where he served as a financial guru. In fact, he explored the term "chaordic system," an adjective born from the fusion of chaos and order. The concept contrasts with the traditional business system. For him, a company should be neither a rigid hierarchy nor anarchic chaos, but a living and adaptable structure.