Publications

WHF Articles published by FinTech | Software Industry media sources.

10/23/20 Digital Transactions

Why Attrition Is No Longer a Core Metric for Valuing Merchant Portfolios

For all merchant acquirers and all those investing in merchant-acquiring assets, here’s the takeaway: Attrition analyses no longer carry the weighting they once did. As such, attrition KPIs cannot be used as a primary driver of valuation.



6/8/20 Fintech Direct

Is The Fintech Acquisition Market Active? (The Answer May Surprise You)

publication descriptionThere are however, fintech mergers, acquisitions, and investments being transacted. In fact, there are a lot of such transactions being done. It’s one sector that’s experiencing a counter-trend boom in M&A and investment, despite the dynamics which have limited M&A activity in other sectors. To get a better understanding of why, let’s take a closer look at the drivers for these transactions



5/28/18 
The Green Sheet

I’ve Secured Growth Capital for My Payments Company – How Do I Optimize Investment Monies to Maximize Value?

Optimizing investment capital to create long term value and produce meaningful growth isn’t easy. For all companies, there exist many pathways to do so – many routes to get from point A to point B – but which pathway (or pathways) a merchant acquirer chooses is largely a function of how that acquirer is presently constituted as it relates to its operational efficiency and competency, sales and distribution channels, and product and service offerings. Understanding where one’s business is strong, where it is weak, and where it can thrive with additional resources, is the first step in answering the question of how best to optimize investment capital.



3/26/18
 The Green Sheet

Market Killers – The Top 5 Reasons Buyers Won’t Acquire Your ISO

I often write about the attributes of merchant acquiring platforms that create long term value and whet the appetite of companies who seek to acquire the same, but what about
looking at your business the other way – what about looking at the attributes of your company that are abject turn-offs to the marketplace, to the point where buyers won’t even consider acquiring you? One could argue this exercise is simply a different pathway to the same information/conclusions, however, I would argue that it’s not. What I’m providing here are single factors – sole attributes – of merchant acquirers’ businesses that can (and do) cause buyers to walk away at first blush. These five reasons that buyers won’t acquire your ISO are true market killers.



2/12/18
The Green Sheet

Maximizing Portfolio Value in a Sale: Capitalizing on the Valuation Variance of Downline MLS Portfolios

publication description…ISO owners today need to anticipate the possibility of gross residual purchases and account for that potentiality in their agent and MLS agreements. In a portfolio deal where the gross residual is being purchased, ISO owners need to have already included buyout formulas in their MLS/agent agreements addressing the inherent valuation variance in the downline portfolios. This can be established by creating multi-tiered valuation ranges in the MLS/agent agreements based on the specific portfolio attributes of each downline’s book of business: number of accounts, total processing volume, etc. I would encourage all ISO owners to take a close look at their agent agreements and discuss with an industry specific attorney or consultant the insertion of a framework which addresses the same…


8/28/17 The Green Sheet

Rationalizing Your Portfolio

Once upon a time, a merchant was a merchant was a merchant. The putative strategy in merchant acquiring was simple: board as many accounts as possible – big merchants, small merchants, low risk merchants, high risk merchants, and even new LLCs – basically any merchant with a checking account and an “open for business” sign. The rationale for this was straightforward: payments processing – transaction processing – produced real, actualizable revenue that made merchant acquiring a lucrative endeavor.
 

Fast forward to the year 2017, and much has changed, not the least of which is margin compression on basic transactional processing. In fact I submit that the “merchant is a merchant is a merchant” strategy is no longer viable. The fact that so many leading acquirers today have transitioned their revenue models away from a dependency on transactional processing, and towards the delivery of technology based, value added products and services, is a defining attribute of today’s new merchant acquiring paradigm, and one that will surely be a lasting one.


4/24/17  The Green Sheet

ISOs Take Note: The Value of Operational Expertise is Skyrocketing

The value of operational expertise in the ISO world is skyrocketing, taking on new import as the business paradigm for merchant acquiring has transitioned away from transaction processing and toward delivering robust, all-encompassing, technology-based business management solutions for merchants.

As such, the fundamental nature of the ISO’s personnel makeup is changing as well. It’s no longer viable for an ISO to exist purely as a sales platform providing Level 1 support. Because the products and services that ISOs sell today are more expansive and sophisticated, the sales channel, support platform and ability to manage both all require a higher degree of business acumen.


1/9/17  The Greensheet

ISO v. MLS Status: The Stakes are High in 2017

…the payments world has changed and so too has the calculi of making the agent to ISO transition…the value proposition to today’s merchant is how payments are processed (quickly, securely, and across in-store, mobile, and web based user interfaces), and what technologies those payments are packaged up with (new schema like omni-channel and or end-to-end business management solutions)


11/26/16  Business Solutions Magazine

Optimizing Your ISV For Payments Processing

“Once an overlooked service offering and revenue stream, payments processing has risen to celebritydom in the software community as a way to flesh out an ISV’s existing value proposition to its end-users, and as a long term strategic play for enterprise value creation through the high quality, recurring revenue that it brings to bear. The recognition of the value of payments processing by ISVs has catalyzed vertical integration and strategic partnerships between software and payments companies, and has compelled ISVs to pay much closer attention to negotiating an optimal relationship with their payments processing partners.”



10/14/16
  Business Solutions Magazine

Payments Processing Strategy for ISVs, VARs, & MSPs

Independent software vendors, value-added resellers, and managed services providers are in the payments processing game, and payments processors are in theirs. This is as much a reality today as the earth revolving around the sun. What is not yet a reality though is a balance in value creation across both communities. I would argue that the cause of this imbalance, which at the moment favors the payments community, is largely attributable to a developing but not yet complete understanding of the mechanics of payments processing by their ISV, VAR, and MSP partners.



11/10/16
The Green Sheet

Payments M&A: The Narrowing Delta Between ISO & Merchant Portfolio Valuations

publication descriptionISOs are no longer just in the payment processing business – they’re in the technology business, and the sale, implementation and servicing of these new technologies doesn’t come without a price. Whether an ISO elects to build, develop or acquire these new technologies, or leverage someone else’s technology in some form of joint venture or strategic relationship, the ISO is necessarily accruing new costs, which have a direct impact on the ISO’s portfolio valuation.


8/18/16  Business Solutions Magazine – Growth Strategies for the IT Channel

ISV Valuations: Exposing the Silent Power Play between Integrated Software Vendors and Payments Processors for Ownership of the End-User Relationship

From the perspective of enterprise value creation, for many ISVs with payments integration, it all comes down to the relationship with the end-user. Understanding why this is true is critical for all integrated software platform owner/operators.


8/9/16  The Green Sheet

Payments M&A: Acquiring the Right Financial Technology to Complement Your Existing Payments Business

One of the payment industry’s leading experts and consultants provides insight for merchant acquirers who are trying to successfully pivot towards the future, and viability, by providing end-to-end business management solutions which also happen to integrate payments processing. A slew of helpful suggestions when contemplating the employment of a new strategy, away from the old, and into the new.


7/11/16  The Green Sheet

Payment Consultant’s Guide to a Successful Portfolio Acquisition Strategy

A quick guide to making payments processing portfolio acquisitions in today’s marketplace. The payments processing space is evolving at an extraordinary pace, and the drivers behind portfolio acquisitions have changed. The article also speaks to the single most important aspect of any acquisition strategy, portfolio or other.


8/18/16 Business Solutions Magazine – Growth Strategies for the IT Channel

ISV And VAR Valuations Are Rising With Payments Integration

Payments processors and service providers aren’t the only ones benefiting from rising valuations in today’s massive convergence of technology, banking, and payments. Though the payments industry has successfully leveraged synergistic value from the acquisitions of, and/or strategic partnerships with ISVs and VARs, there has been a similar effect evidenced on the other side of the equation as well.


6/27/16  The Green Sheet

How Integrated POS & Payments Infrastructure Technologies Are Lifting Acquirer Valuations: Connecting the Dots

Payment consultant’s explanation of how the strategic acquisition of integrated payments technologies and POS effectuate valuation lift for merchant acquiring platforms.


6/15/16  Business Solutions Magazine

The Payments Industry Has Gone Vertical And They’re Building Shareholder Value On The Backs Of ISVs And VARs

Insight for the ISV / VAR community on the dynamics of their relationships with their payment processing integrators; particularly as it relates to enterprise value creation.


4/11/16  The Green Sheet

Is EMV Enabled POS “Payments Technology”?

For owner/operators of payments companies looking to build enterprise value, does providing EMV upgrades qualify as payments “technology”?


10/26/16  The Green Sheet

Targeting Retail SME Can Kill The Value Of Your ISO

In 2016, merchant portfolio valuations are being depreciated my SME merchant composition.


1/25/16  The Green Sheet

The M&A Market 2016: 10 Things To Know To Best Position Your Business

Payment Experts View of the M&A Market In 2016


1/9/15  The Green Sheet

Words That Kill (Deals)

ISO and MLS contractual terms that can hinder M&A transactions.


11/9/15  The Green Sheet

The Counterintuitive Paradoxical Nature of Large Merchant Accounts


9/14/15  The Green Sheet

Sharks and sharps: Who’s buying your bankcard business?


8/10/15  The Green Sheet

The Most Valuable Merchant Portfolio

A Payments Consultant’s Opinion of what a “Perfect” Merchant Portfolio Would Look Like.


7/13/2015  The Green Sheet

The ISO And Portfolio Market That Wasn’t Supposed To Be

A Payments Consultant’s View of the 2015 Marketplace.