Caleb Avery, CEO
The recent rise of payment facilitation has done away with the traditional hurdles associated with credit card processing. The application, underwriting and review processes — once manual and time-consuming tasks — can now be accomplished instantly. The abilities to create accounts and start processing payments within minutes make the appeal of payment facilitation pretty obvious, especially for modern B2B software companies. Many of these companies partner with managed payment facilitators, or PayFacs, to offer their merchants a highly streamlined and seamless onboarding process. And while managed PayFacs like Stripe or Braintree offer businesses seamless service with no upfront investment and operational burdens, there is a catch. For all the benefits that managed PayFacs offer, they take all the margin on processing fees for their own profit. This might be okay for a while, but as business grows, companies realize they are losing out on a significant revenue opportunity. Helping B2B software companies make the most of this opportunity is Tilled, a pioneer in PayFac-as-a-Service. With Tilled, software companies can enjoy all the benefits of becoming a PayFac, without any upfront investment, ongoing overhead, or additional liability.
Tilled reimagines the traditional way of becoming a registered payment facilitator through its PayFac-as-a-Service platform. Historically, businesses were required to go through a multi-million dollar process that usually took more than two years to become fully registered payment facilitators. In addition, these companies had to set up separate teams to manage underwriting, fraud monitoring, daily settlement and more. Tilled eliminates this grueling and, not to mention, expensive process by allowing software companies to integrate their APIs and launch the payment process in two to three weeks.
More importantly, as companies do not need to hire any additional employees to manage the process, they can do away with any additional overhead costs. Tilled also continues to pay its clients the lion’s share of the revenue on all the transactions that are flowing through their software systems creating a powerful recurring revenue stream. “We are giving these software companies all of the benefits of the payment facilitator model without actually having to go through the regulatory and compliance process of becoming a fully registered payment facilitator,” mentions Caleb Avery, CEO of Tilled.
That said, the question becomes: how does Tilled enable companies to monetize their payments? Well, Tilled facilitates this by providing its partners a pass-through of its wholesale Interchange-Plus buy rates, and then allowing its clients to set up their pricing. This simple business revenue sharing model comes with zero upfront costs or fixed monthly costs. “We allow our software partners to set the pricing for their transactions and share the revenue,” says Avery. It is worth mentioning that clients receive a staggering 66 percent of the revenue generated from the payment processing fees. In essence, companies can increase their income if they conduct more transactions through Tilled.
To execute this revenue-sharing model, the company has built its own end-to-end payment gateway system. Their technology enables clients to get the system up and running in record time with the help of a team of developers. In addition, Tilled follows a white-glove implementation process that walks the clients seamlessly through various phases of implementation and gets the system online. They also help the clients design the pricing strategies and function like a payment expert to operationalize the business. Needless to say, Tilled also provides tier one support to its partners and helps them go to market without hiring additional team members to manage customer support, fraud monitoring, and other customer-facing roles. In addition, they take care of KYC checks and help them fulfill the annual PCI obligation utilizing a self-assessment questionnaire that takes two to three minutes to complete.
Such innovative features stem from the company’s technological prowess and its unique business model that aims at reimagining payment facilitation. Moving ahead, Tilled plans to expand its business globally, especially across Europe. When it comes to augmenting their capabilities, Tilled is all set to launch an omnichannel payment processing solution that enables software platforms to seamlessly add a card terminal into the current platform. The company expects that this will help its clients capture more payment volumes in the days to come.