Latest / Leaders In Payments / AI in Payments Series: Featuring Payarc Co-Founder & President, Jared Ronski | Episode 427

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AI in Payments Series: Featuring Payarc Co-Founder & President, Jared Ronski | Episode 427 · Leaders In Payments

• 0:19
  Speaker 1: Thank you.
• 0:20
  Speaker 1: Scale their businesses one payment at a time.
• 0:22
  Speaker 1: At Payark, ai is more than a buzzword.
• 0:25
  Speaker 1: It is integrated into everything they do, from predicting merchant churn to risk assessments, to self-service tools.
• 0:32
  Speaker 1: Join us for this special series on AI in Payments.
• 0:38
  Speaker 2: Hello everyone and welcome to the Leaders in Payments podcast.
• 0:41
  Speaker 2: I'm your host, Greg Myers, and on today's show we have a very special guest, Jared Ronski, who is the co-founder and president at PayArk.
• 0:48
  Speaker 2: But before we dive into the episode, I just wanted to mention a few things.
• 0:51
  Speaker 2: We've had several people on the show from PayArk as we've been talking about AI and some other topics in the industry.
• 0:57
  Speaker 2: We've had on recently Zach Schneiderman, who is the VP of ISV, We've had John Minitaglio, the CTO, Dustin Siner, the Chief Revenue Officer, and a little over a year ago we had Zach Martinez, the CEO of the company, on the show.
• 1:12
  Speaker 2: So I suggest you go back and listen to those episodes.
• 1:14
  Speaker 2: But today we have, like I said, Jared on.
• 1:17
  Speaker 2: He was on before.
• 1:18
  Speaker 2: So welcome back to the show, Jared.
• 1:19
  Speaker 2: Thank you for being here.
• 1:20
  Speaker 2: Thank you so much, Greg, Excited to be here.
• 1:21
  Speaker 2: Well in here.
• 1:22
  Speaker 3: Thank you so much, Greg Excited to be here.
• 1:22
  Speaker 2: Well, if you don't mind, just give us a brief overview of the company, so the audience kind of gets a reminder of what Payark does.
• 1:34
  Speaker 3: Yeah, absolutely so, I would say at the highest level.
• 1:35
  Speaker 3: Payark is a modern payments company, but what we really do is help businesses grow by removing the friction from the payment side and, more importantly, or most importantly I think, it's to empower our agents and our ISPs to serve those businesses in a better fashion.
• 1:47
  Speaker 3: We are really focused on partnerships.
• 1:49
  Speaker 3: We have a very good track record of retaining agents.
• 1:53
  Speaker 3: I think I may have mentioned this on the last podcast, but one of the things I'm most proud of is that some of the partners that started off with us in 2017, 2018, when we started that business, are still working with us today.
• 2:05
  Speaker 3: So we are very much a partner-focused payments company that enables payment solutions on behalf of both our agents as well as our ISPs.
• 2:14
  Speaker 2: So obviously and you mentioned the independent sales agents channel is very important to your business.
• 2:19
  Speaker 2: It's a major priority for you With all the regulations, shifting revenue models and you mentioned this kind of partner-first mentality.
• 2:26
  Speaker 2: So what does that partner-first thing really look like on a day-to-day basis with the agents?
• 2:32
  Speaker 3: Yeah, I think a good way to describe it is growth through alignment.
• 2:36
  Speaker 3: We're not looking just to process transactions, but our goal is to build tools, provide training and revenue models that make our partners more successful.
• 2:44
  Speaker 3: At the end of the day, our partners aren't just resellers, they're collaborators.
• 2:49
  Speaker 3: What's important for us is to be transparent, to provide clear revenue splits, portfolio visibility, support whether it's a dedicated relationship manager, a support team, a dedicated support person, real-time support for them when they're with a merchant trying to help them and flexibility.
• 3:04
  Speaker 3: And I think for flexibility, it really means to adapt to our partner's vertical focus and never really forcing a one-size-fits-all type of solution on our partners.
• 3:15
  Speaker 3: There is an environment here of regulation and there's definitely pressure on margins.
• 3:20
  Speaker 3: So what's important to us is really to invest in the relationship equity with our agents, and that's really our goal.
• 3:27
  Speaker 2: Well, building on that partner first kind of approach or mentality.
• 3:30
  Speaker 2: Can you walk us through the Pi AI pricing advisor that you have A couple of components to that, if you don't mind touching on?
• 3:38
  Speaker 2: So, like, what inputs does it consider?
• 3:40
  Speaker 2: How can agents use it to build proposals and do discovery, and then how does it surface new revenue streams for them?
• 3:48
  Speaker 2: So maybe define it and touch on those things.
• 3:50
  Speaker 2: That'd be great.
• 3:51
  Speaker 3: Yeah, a great way to describe it is having a seasoned sales coach whispering in your ear every time you're on a call with a merchant, that at a high level.
• 3:59
  Speaker 3: This is something that I have championed within Pear.
• 4:01
  Speaker 3: I came from an agent background, so I spent many late nights, days, working on proposals, analyzing statements, and there's a lot of complexity to it.
• 4:10
  Speaker 3: There isn't a standard template when it comes to statements.
• 4:14
  Speaker 3: Sometimes they're very hard to read, it's hard to get the pricing.
• 4:17
  Speaker 3: So what we wanted to do is really simplify this for our partners and allow them to be able to turn around proposals and analyze statements in real time.
• 4:25
  Speaker 3: So let's talk about the inputs.
• 4:27
  Speaker 3: Basically, it's as simple as uploading a merchant statement.
• 4:31
  Speaker 3: So we look at the merchant type, what the volume is, the risk profile, the ticket size, and then the output is going to be potentially one or more pricing structures that our partners can propose to the merchant.
• 4:44
  Speaker 3: So it really depends on how that agent wants to work with the tool, but it will give them insight on to how the margins shake out, how they potentially compare to industry benchmarks and some of the real benefits I see here is speed right being able to get back to their merchants with an answer in real time or extremely quick, the confidence that this will give our agents to provide those proposals but also not worry that they're leaving money on the table as well.
• 5:09
  Speaker 3: The tool can actually suggest revenue streams that an agent may not have thought about.
• 5:13
  Speaker 3: That's kind of the tool at a high level.
• 5:16
  Speaker 3: Like I mentioned, I've had many, many times reviewing statements and they can get very confusing and I think whether that's intended or not intended.
• 5:25
  Speaker 3: But the real benefits to this tool is speeding up the discovery calls, opening up new verticals and drive smarter, higher margin deals, and I think in those scenarios the agents win and the merchants win.
• 5:37
  Speaker 2: Well before this.
• 5:38
  Speaker 2: What did they have to do?
• 5:39
  Speaker 2: Were they analyzing this themselves?
• 5:41
  Speaker 2: Were they having you guys help them.
• 5:43
  Speaker 2: What was it like before?
• 5:44
  Speaker 3: Combination of both.
• 5:45
  Speaker 3: Some agents would take it upon themselves.
• 5:47
  Speaker 3: Maybe they've been in the industry for a long time or they worked at a processor or an ISO in the past, so they have some background on that.
• 5:54
  Speaker 3: Or they would send us the statements.
• 5:56
  Speaker 3: We would analyze it.
• 5:58
  Speaker 3: We provide them with what the merchant is currently paying today.
• 6:00
  Speaker 3: They would tell us hey, create a proposal based on a 20% savings, whatever they want to reduce, if they want to reduce, and we would create that proposal.
• 6:14
  Speaker 3: That takes time, it's not going to be done in real time and in that interim a merchant may be approached by somebody else.
• 6:17
  Speaker 3: Our goal is to really speed up that process and have the agents have the tools at their disposal to do it themselves.
• 6:21
  Speaker 3: It's not that we don't want to do it, but I think, training and teaching people to do it themselves.
• 6:26
  Speaker 3: It's not that we don't want to do it, but I think, training and teaching people to do it themselves.
• 6:29
  Speaker 3: There's that old saying, you know give a man a fish eat for a day.
• 6:31
  Speaker 3: Teach a man to fish eat for a lifetime.
• 6:32
  Speaker 3: We want our agents to be fishing for their lifetime and we want to provide them with the tools to be able to do that.
• 6:37
  Speaker 2: So is it truly a self-service kind of log in and do it yourself type tool?
• 6:41
  Speaker 3: Absolutely yeah, it will be available through our agent portal.
• 6:43
  Speaker 3: They'll be able to log in, upload statements, very much like a chat GPT type of interface where you can say, hey, analyze a statement.
• 6:51
  Speaker 3: That would be what that merchant is currently paying today, recommend some pricing structures based on a percentage savings or any other ideas that the agent has in mind, and then ask it, hey, are there additional revenue opportunities here?
• 7:03
  Speaker 3: And it will be able to do all that in real time and take a process that could potentially take a day or more, in minutes or less.
• 7:10
  Speaker 2: Okay, well, we'll dive into one kind of vertical here, kind of the microtransactions and the small ticket e-commerce on the rise in our industry across the board.
• 7:20
  Speaker 2: What should agents understand about kind of the unit economics and how can this pricing advisor point to different pricing models that are going to make them both more money and make sure they're compliant?
• 7:32
  Speaker 2: Of course, that's always important, but more profitable.
• 7:35
  Speaker 3: The challenge, when it comes to microtransactions specifically, isn't necessarily volume, it's really interchange economics.
• 7:41
  Speaker 3: The per transactions costs crush margins if mispriced.
• 7:45
  Speaker 3: So our pricing tool can instantly show blended models whether it's a subscription plus a percentage fee or a flat rate, and it will show them how this will make sense based on the volume.
• 7:56
  Speaker 3: What our goal here is to position PayArk as helping agents unlock these verticals, as opposed to avoiding them entirely.
• 8:04
  Speaker 3: There's a lot of opportunity, whether it's app-based commerce, digital content, small ticket e-commerce.
• 8:10
  Speaker 3: These verticals are exploding, but a lot of agents tend to avoid them because the pricing seems impossible.
• 8:15
  Speaker 3: Our goal with this tool is to really make it approachable and profitable.
• 8:20
  Speaker 3: That is really our goal with this.
• 8:21
  Speaker 3: So, even using the Pi tool, a $2 average ticket sounds great until you realize that the interchange minimums eat half of that, and we really want to educate our agents on the unit economics and support them in going after these types of verticals.
• 8:35
  Speaker 2: Okay, great.
• 8:36
  Speaker 2: So with all the changes and regulations, from interchange changes to the Genius Act, to Visa's VAMP program there are all these things going on in the industry.
• 8:48
  Speaker 2: It feels like there always has been and always probably will be.
• 8:51
  Speaker 2: But how do you work with the agents to anticipate and adjust to these new regulations?
• 8:57
  Speaker 2: And, if you want, we can dive into the VAMP program specifically.
• 9:00
  Speaker 2: But let's start broader.
• 9:02
  Speaker 2: How do you work with the agents to make sure they're staying on top of things and they really know what's going on.
• 9:07
  Speaker 3: Yeah, absolutely so.
• 9:08
  Speaker 3: Let's touch on VAMP.
• 9:09
  Speaker 3: I think that's top of people's minds right now.
• 9:11
  Speaker 3: He's a new rule Counts pre-dispute chargeback resolutions towards the VAMP ratio.
• 9:16
  Speaker 3: So this is a big change.
• 9:17
  Speaker 3: That means, even if you resolve something quickly, it still is potentially or looks like a strike against the merchant.
• 9:23
  Speaker 3: So why does this matter?
• 9:25
  Speaker 3: Agents who aren't paying attention risk seeing their entire portfolio splagged.
• 9:29
  Speaker 3: So how we approach this?
• 9:30
  Speaker 3: First of all, it's proactive monitoring.
• 9:32
  Speaker 3: We use real-time dashboard to spot risk before the merchant does and before Visa does.
• 9:37
  Speaker 3: Secondly, education We'll work with merchants to prevent disputes, using tools like better billing descriptors, refund policies and communication to really help these merchants avoid the problems that BAMP could potentially bring them.
• 9:52
  Speaker 3: Now, on the agent side, it's really about coaching.
• 9:54
  Speaker 3: It's important to educate and have open minds and communication with our partners to know which verticals are trending more on the risky side and how to talk to that with their potential merchants.
• 10:06
  Speaker 3: I think that there's a lot of compliance checklists out there.
• 10:11
  Speaker 3: What we feel that our partners really need is a partner who helps them protect their revenue and not just check a box.
• 10:17
  Speaker 3: That is very important to us and that applies both to the updates and interchange and really any type of new change that happens in payments.
• 10:25
  Speaker 3: It's through education.
• 10:26
  Speaker 3: We conduct webinars.
• 10:27
  Speaker 3: Our relationship managers reach out to speak to our partners on a one-on-one basis.
• 10:31
  Speaker 3: If our partners have questions, we encourage them to contact us.
• 10:35
  Speaker 3: We're always available to have these discussions.
• 10:37
  Speaker 3: We hopefully know the answer.
• 10:39
  Speaker 3: If we don't know the answer, we will make sure it's a priority to get back to them.
• 10:46
  Speaker 3: It's a very fast changing industry and it's important for us to be on top of it and communicating with our partners any type of change that may affect their business.
• 10:51
  Speaker 2: So is there the ability to kind of real time you see something going on in a merchant to reach out to that agent and say, hey, there's something going on here, Can you talk to them?
• 11:00
  Speaker 2: Is that kind of the process?
• 11:01
  Speaker 3: Exactly, and we do that on a daily basis.
• 11:03
  Speaker 3: Our goal is to spot trends before they become issues, so we will see whether it's an increase in chargeback ratio, an increase in fraud disputes.
• 11:10
  Speaker 3: We will actually use tools to dig into the chargebacks and understand why are these happening.
• 11:17
  Speaker 3: What is the issue here?
• 11:18
  Speaker 3: Is it a fulfillment timeline?
• 11:20
  Speaker 3: Is it a customer support issue?
• 11:21
  Speaker 3: What is the actual issue?
• 11:23
  Speaker 3: We'll get on the phone with our partners, explain all the data that we've collected and what we feel a good resolution would be to the situation, and then they can go communicate that to their merchants.
• 11:33
  Speaker 2: Okay, so for the agents out there that might be listening to the show, what does a typical engagement look like In terms of working with?
• 11:39
  Speaker 3: Pear, the ideal engagement looks like onboarding, a training, so we want our partners to be closing fast and not stuck in paperwork.
• 11:46
  Speaker 3: So we will use technology whether it's our partner hub, whether it's our online application to move deals quicker and get merchants live faster.
• 11:55
  Speaker 3: Another important point is shared dashboards, so we believe that our agents and our partners should see the data in real time.
• 12:02
  Speaker 3: That gives them access to understand the portfolio, ask any questions about us, but also communicate more effectively with their merchants.
• 12:09
  Speaker 3: We basically treat our agents like enterprise customers and we'll always review their portfolios, spot opportunities that they may be missing and communicate with them ways to adjust their strategy.
• 12:20
  Speaker 3: In terms of resources, especially growth resources, they'll have a dedicated relationship manager.
• 12:25
  Speaker 3: That person will also help them on the education side, growth coaching, as well as any insights into their data manager.
• 12:33
  Speaker 3: We don't want our partners to just know one person in care.
• 12:36
  Speaker 3: It's important for us or for our partners to know multiple people, whether it's somebody on the risk team, whether it's somebody on the support team, somebody on the operations team, somebody on the deployment team.
• 12:46
  Speaker 3: We want them to feel like they're part of the family and that they can reach out to anybody and have a conversation or ask questions anytime they want.
• 12:53
  Speaker 3: Some of the things that we're working on internally is more AI tools whether it's more features on the pricing advisor, things like predicting churn before that actually happens, using AI to spot risk or potential risk before it becomes a bigger issue, as well as expanding and improving our ISV integrations.
• 13:13
  Speaker 3: That's something that's very important to us, as well as looking at different verticals.
• 13:16
  Speaker 3: Telehealth is a vertical.
• 13:18
  Speaker 3: We've had a lot of success in the micro transactions that we've discussed already and as well as more transparency in reporting.
• 13:24
  Speaker 3: The more information that we can provide to our partners, the better this relationship will be going forward.
• 13:29
  Speaker 2: You said something in there.
• 13:30
  Speaker 2: You may not even notice it.
• 13:32
  Speaker 2: It resonated very strongly with me is that you treat the agents like you do an enterprise customer.
• 13:39
  Speaker 2: So I thought that was a really key point.
• 13:41
  Speaker 2: Something that should resonate with the agents that they're not just a number, they're part of Payark and you want them to be a big part of the Payark family 100%, and that goes all the way from the initial onboarding call to any support tickets.
• 13:56
  Speaker 3: We don't want them to think of themselves as just another ticket in the queue.
• 13:58
  Speaker 3: Their business, no matter how big they are, is extremely important to us.
• 14:01
  Speaker 3: If they're successful, we're successful.
• 14:03
  Speaker 3: So we really focus on that and we provide as much tools but as much support as we can to stop any issues before they happen.
• 14:11
  Speaker 3: But in this business there's stuff that's beyond anybody's control.
• 14:13
  Speaker 3: It's how you deal with it, and I think we've done a very good job of working with our partners to ensure that they know they can trust us and we can trust them and we can collaborate and work on any type of solution that needs to be imposed.
• 14:26
  Speaker 2: Well, one final question, and I'm going a little off script here, but it's in the back of my mind.
• 14:30
  Speaker 2: We've heard about death of the ISO.
• 14:32
  Speaker 2: I mean, that's been a phrase for years, right, but what about agents?
• 14:35
  Speaker 2: How are you seeing our agent?
• 14:37
  Speaker 2: Is that kind of getting larger, smaller, staying the same?
• 14:40
  Speaker 2: Where do you think we're headed with, kind of that whole agent?
• 14:43
  Speaker 3: business model?
• 14:44
  Speaker 3: Great question.
• 14:45
  Speaker 3: I don't see it dying anytime soon.
• 14:48
  Speaker 3: I think that the agent model for us has been extremely successful.
• 14:51
  Speaker 3: We've built our business around that.
• 14:52
  Speaker 3: We are signing new agents on a daily basis and there's still tons more opportunity out there.
• 14:57
  Speaker 3: You're signing new agents on a daily basis and there's still tons more opportunity out there.
• 15:00
  Speaker 3: I think the value that an agent brings to a merchant, it's that really close relationship and I think that when you're dealing with somebody's income or a merchant's ability to process transactions, it's important that they have that personal contact.
• 15:10
  Speaker 3: Like I mentioned before, I came from the agent space.
• 15:12
  Speaker 3: I don't see agents going anywhere.
• 15:15
  Speaker 3: I think there's only room to grow for agent partners, but they may have to adapt right, Whether it is looking at new verticals, changing the way to do business and I think that applies to any industry but the ones, the agents, that are able to adapt and look for new potential opportunities will be extremely successful.
• 15:30
  Speaker 3: But I definitely don't see that going anywhere.
• 15:32
  Speaker 3: I think the opposite.
• 15:33
  Speaker 3: I think there's a lot of opportunity for growth.
• 15:35
  Speaker 3: Okay, the opposite.
• 15:35
  Speaker 2: I think there's a lot of opportunity for growth.
• 15:36
  Speaker 2: Okay, well, great.
• 15:37
  Speaker 2: Well, jared, before we wrap up the show, just want to kind of open the floor, see if there's anything else you wanted to add, maybe anything we missed during the conversation.
• 15:44
  Speaker 2: Just kind of open the floor for final comments.
• 15:47
  Speaker 3: Yeah, I appreciate that.
• 15:48
  Speaker 3: I just want to reiterate that PayArk is an agent-first payment processor and in an ever-shifting industry, it's a big differentiator.
• 15:56
  Speaker 3: You know, we're not here just to process payments.
• 15:58
  Speaker 3: We're here to make sure that our agent and partners grow confidently.
• 16:01
  Speaker 3: So any agents that are listening, now is the time to deepen the relationship, whether it's training, a portfolio review or even trying out our prior tools.
• 16:08
  Speaker 3: We're building this for you guys, so we'd love to show you what we have and see how we can do business together.
• 16:14
  Speaker 2: Well, jared, great seeing you again.
• 16:15
  Speaker 2: We can do business together.
• 16:16
  Speaker 2: Well, Jared, great seeing you again, and thank you so much for being on the show.
• 16:18
  Speaker 2: I know your time is very valuable, so thank you for being here today.
• 16:20
  Speaker 2: My absolute pleasure, Greg.
• 16:21
  Speaker 3: Have a fantastic rest of the summer and look forward to speaking to you again soon.
• 16:25
  Speaker 2: And to all you listeners out there.
• 16:26
  Speaker 2: I thank you for your time as well, and until the next story.
• 16:30
  Speaker 1: Thank you for joining us today as we discussed how Payark is leveraging AI to transform payments.
• 16:35
  Speaker 1: To learn more about Payark, visit wwwpayarkcom.