It’s a pretty awesome time to be a vertical SaaS company. SaaS has always been attractive given the recurring and predictable nature of SaaS revenue, the opportunity for category leaders to command dominant positions in their given verticals, and the plethora of ways to monetize one’s platform when you become the mission critical system of record for your installed client base. Now more than ever though, SaaS companies have so many levers they can pull to diversify their business model and unlock lucrative new revenue streams. Insert Payments Monetization. As most savvy SaaS operators already know, there’s a ground swell of TRILLIONS of dollars in payments volume and hence hundreds of billions in payments revenue, migrating from the traditional ISOs / MSPs and legacy means of distribution to SaaS companies across every vertical imaginable and unlocking massive new revenue opportunities for them.
We were inspired to create Payabli after helping architect ServiceTitan’s Payments offering. Whereas ST had the resources to hire a large team, stitch together integrations to various disparate APIs, and manually manage a complex system, we believed the next generation of Service Titans, Mindbodys, and Toasts who will make Payments a core part of their business model need something different. We believe they need a modern, “API First” Payments Stack that seamlessly ties together the key vectors of managing and scaling a SaaS Payments Business:
- Pay-Ins
- Payouts
- Pay Ops.
Pay-Ins
Payment Acceptance, or as we call it Pay-ins is the low hanging fruit. The cats out the bag—there’s significant revenue to be made on the merchant acquiring side of the payments business, where a vertical SaaS company effectively becomes an ISO or a Payment Facilitator and enables their merchants with the ability to accept payments. While integrated payments is nothing new for Software companies, there’s a fundamental difference between payments as a feature set, and Payments as a core part of your business model. Today’s vertical SaaS companies need a developer friendly API and Embedded Components to deliver a world-class payments experience that seamlessly blends with their User Experience while reducing their PCI scope and security vulnerabilities. They should be evaluating Payments Partners’ breadth of their offering to ensure they can not only deliver for today’s basic payments use-cases but continue to drive value in future iterations of their Payments offering.
Payabli provides robust APIs and Embedded Components so our SaaS partners can design world-class payments experiences for their specific verticals and use-cases. From Card-Not Present solutions like eInvoices and Pay-Links, Dynamic Payment Pages, subscription billing and logged-in customer pay portals to Cloud Device integrations to power Webapp Integrations and offer payments in the field or diverse retail environments. Of course, we can’t forget the nuanced, but highly strategic solutions like L2/L3 processing to optimize B2B interchange rates, compliant and powerful Service / Convenience fee engine, or the ability to consolidate numerous payment methods from CC and ACH to Billpay and Lockbox payments.
Payouts
Less understood, but oftentimes more lucrative is Payouts Monetization. SaaS companies often overlook the fact that while a Gym, an HVAC Contractor, or a Childcare Facility want the ability to accept payments from their clients, these same merchants need ways to efficiently, securely, and economically send money to vendors and suppliers, sub-contractors, employees and a coterie of other plausible recipients. Aside from creating significant efficiencies and cost savings by helping their clients with Payouts, there’s significant revenue for SaaS companies to unlock here as well.
The same Developer friendly APIs and embedded components are available through Payabli for our SaaS Partners to prop-up and monetize on the outflows of capital from their platform. Whether it’s fully automating and optimizing the accounts payable process, developing a Spend Management program to help manage clients’ employee’s expenses, or various other potential PayOuts use cases, Payabli is focusing heavily on helping our Software partners on all things payouts. This goes beyond Card Issuing and monetizing within the interchange, Payabli is helping our Partners disburse and monetize payouts through a slew of payment modalities like vCards provisioned to a digital wallet, ACH, Real-Time Payments (RTP), Push to Card, and more.
While this is usually a second stage integration, Software partners when thinking about their ideal Payments Infrastructure should be looking down the pike to ensure their partner can help them develop and monetize on payouts.
PayOps
PayOps may not be sexy, but these are the critical tools that allow SaaS companies to establish maximal control over their payments experience and command maximal revenue. Payabli aims to be the “bridge” across your entire Payments monetization journey. This means that we can assume the role of our clients’ outsourced payments team and provide all the managed services that go along with running the operation of a payment. However, we’re designed as a scaled program to help you take on responsibility over your payments business and ultimately unlock the lion’s share of the Payments revenue.
Some of our competitors have been all in on PayFac as a Service. We’ve validated that most Software Partners don’t need to, don’t want to, and shouldn’t invest in the arduous process of becoming a PayFac. In reality, they just need PayOps solutions that provide certain PayFac like capabilities like frictionless boarding, split payments and consolidated ACH and CC funding, among other things. Our robust suite of PayOps solutions like frictionless boarding, Underwriting Management, Billing and Pricing, Dispute Management, Fraud and Risk Tools, and more, allow our Partners to choose what parts of their Payments business they want to manage and the tools needed to do so. And hey, when our partners are crushing it so much and processing Billions in volume, at which point it may make sense for them to become a PayFac then great, just leverage our PayOps stack instead of building it from scratch.
Within PayOps are the underlying economics, margin maximization tools, and reporting infrastructure to drive massive revenue from your SaaS Payments business. It’s not enough to earn payments revenue, SaaS companies should have clear and transparent revenue reporting and be educated on what levers they can pull to unlock more revenue from their Payments offering.
At Payabli we operate off a simple thesis that If you’re a Software Company, You’re a Payments company. We believe we’ve built the best holistic Payments Infrastructure platform to help today’s vertical SaaS companies build, manage and scale a best in class Payments offering. To find out more about what we’ve built and are building, we invite you to schedule a call with one of our Payments Consultants and discuss your Payments strategy and if Payabli could be a good fit for you.
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Former G2M Leader, building new age Payments Infrastructure to make every Software Company a Payments Company,