The market for the VeriFone products is large and growing larger. The company was founded by William Melton in 1981. Melton started an earlier company in Hawaii to write software for real estate agencies, and this was an early entrant into the computer business before the PC revolution which started in the 1970s and changed the nature of the business. Melton sold his original company in 1980 for $3 million, and he used this money as a stake to found VeriFone to provide local retailers with access to the names of writers of bad checks over the phone. In a short time, Melton had spread his sales and technical staff all over Hawaii so that they would be able to get to know customers personally and to serve their needs better. Within a few years, the company had expanded so it could deal with credit cards as well as checks, offering a verification system for people buying on credit. The company had also moved onto the mainland and continued to expand, and as the company did this Melton continued to expand sales and technical staff along with the service so as to provide direct and personal service to the customer. This had indeed been part of his vision for the company when he founded it, and he did everything he could to assure that it continued being so as the company grew and as it added new services and a computer network to verify checks and credit card sales (Hoover's Handbook of Emerging Companies, 1993, p. 362).
The company has been very successful. Since 1988 sales have grown an average of 25 percent a year, and profits have grown at an even faster rate so that in 1992 the company earned a profit of $25 million on revenues of $226 million. The company today controls 60 percent of the U.S. market for credit card purchase authorization services and has fended off challenges in this area from giants such as IBM and GTE. The company also leads competitors in Europe, Asia, and South America, which now account for 22 per...