The Executive Interview Series provides readers with exclusive insights from movers and shakers in the payments industry. The payments industry is under continuous transformation. This series offers diverse perspectives on everything from strategy to payments technology and the industry’s future.
In this interview between Lazaros Kalemis, CEO & Founder of Simpay, and TSG’s Morgan Murphy, Lazaros highlights Simpay’s journey from its humble beginnings to becoming a leader in business solutions, driven by its Total Business Solutions platform. He delves into the company’s core principles of simplifying operations, fostering transparency, and prioritizing client and employee well-being while addressing industry innovations like AI, data security, and strategic initiatives such as residual buybacks, all within a framework of sustainable growth and entrepreneurial leadership.
Bio: Lazaros Kalemis is a first-generation Greek-American businessman, two-time cancer survivor, father of four daughters and payments industry veteran. In the year 2000, Lazaros co-founded Simpay, a Trevose, PA-based company, providing payment acceptance, employee management solutions, payroll, POS systems, business insurance, and growth tools for businesses across North America. He was honored with a “Philadelphia 40 under 40” award in 2012 and guided Simpay to be recognized by Inc. Magazine as one of the fastest-growing companies in America nine times in a ten-year span. Lazaros was one of five Philadelphia CEO’s inducted into the “Philadelphia 100 CEO Hall of Fame ”, as well as the youngest member inducted in the organization’s history at that time. He was awarded the “SmartCEO Circle of Excellence” award in the Distinguished Leadership category and winner of the Ernst & Young “Entrepreneur of the Year Award.” Lazaros is a plain-speaking industry professional who believes in providing an exceptional experience and unrivaled transparency for clients, employees, independent sales offices, and strategic partners.
Q. Morgan M.
What inspired you to start Simpay and how has it evolved over the years?
A. Lazaros K.
I love telling this story because firstly, it’s absolutely true and secondly, it demonstrates what’s best about the American entrepreneurial spirit. Simpay comes from incredibly humble beginnings, starting in a small apartment above my parent’s pizza shop, almost 25 years ago. I co-founded Simpay with the simple idea of providing payment acceptance solutions to small business owners, just like my parents. I heard from local business owners, many of whom were family members or family friends and saw a common theme about their experiences with payment providers. Generally, providers were out of touch with the needs of “Main Street” businesses and were not providing fair, transparent, essential services that would help support the small business owner. My mission was to listen, offer advice, and do business fairly.
As Simpay grew over its first decade, I noticed other industries serving the small business community with similar poor service track records. There was an opportunity to expand Simpay’s suite of products & services by focusing on solutions every business owner needed. And that’s how the Total Business Solutions platform was created. Since 2011, our platform has focused on essential business needs, payroll, payment processing, commercial insurance, and growth tools like digital marketing and embedded financing.
Today, Simpay has grown from a start-up business serving a handful of small business owners in a neighborhood in north Philly, to a multi-faceted corporation with clients across North America. We employ more than one hundred and twenty people and that number is expected to grow in the coming years to well over two hundred. We’re serving more clients every day and we’re a leading provider of essential business services for small, medium, and enterprise-level companies. From the ground up, we’ve created our Total Business Solutions platform to simplify business owners’ daily operations, reduce costs, boost efficiencies, and increase revenue.
Q. Morgan M.
You’ve received several accolades, including the Philadelphia 40 under 40 award and being a finalist for the Ernst & Young Entrepreneur of the Year Award. How have these recognitions impacted your approach to business and leadership?
A. Lazaros K.
I am certainly grateful for the recognition and a lot of the credit goes to the hard-working people at Simpay who toiled every day to meet our service and sales goals. But to specifically answer your question, I’m going to flip it around a bit. I believe it was my approach to business and leadership that led me to those awards. Receiving them was a validation of my entrepreneurial acumen and mindset. A mindset that everyone at Simpay is encouraged to adopt.
I decided a long time ago that Simpay has three groups of customers we need to tend to. The first, of course, are the tens of thousands of business owners who benefit from our services every day. Next are our partners, the people we do business with. And third, our employees—whom we call “Simpayans.” If the needs of those three groups are met at the highest levels, as often as possible, then our business will thrive.
In service to those three groups, Simpay started using EOS – An entrepreneurial operating system. EOS helped us codify our vision and core values. With this new framework in place and our entire company aligned to the goals, we set about redefining what a payments company should look like. We began to articulate our place in the industry in a clear and concise way, communicating the vision openly and often with clients, vendors, partners, and employees. EOS gives us the tools to track our successes and challenges, communicate our vision and set expectations, and eliminate the distractions that have us chasing our tails.
I believe that EOS has fundamentally changed how we operate. My original vision for Simpay, all those years ago, is now possible because we have the right people in the right seats doing the right things every day.
Q. Morgan M.
The payments industry has changed dramatically since you co-founded Simpay in 2000. What are some of the most significant changes you’ve seen, and how has Simpay adapted to stay ahead of the curve?
A. Lazaros K.
The list of changes just keeps getting longer, doesn’t it? When I look back, it’s incredible to see all the innovations. Once upon a time, it was a sales rep leasing a terminal and selling processing. We’ve seen the advent of PIN debit, signature debit, PCI, EMV, online payments, contactless payments, wallets, integrated payments, embedded finance, a global pandemic, and I’m sure there were a thousand other changes along the way.
Without a doubt, the key driver has been finding ever more convenient ways for consumers to pay for goods and services, and the technologies behind the scenes to allow business owners to accept those emerging payment methods. We hear a lot of buzzwords like “omni channel” and “seamless,” which are simplifications of exceedingly complex buying patterns.
In 2022, 2023, and 2024 we invested significant resources into our company infrastructure, technology suites, and personnel by taking the long view of Simpay’s future. The improvements in technology are making a tremendous impact. Our clients are better served, better attended to, and more confident in the services they acquire from Simpay. Behind the scenes, innovations in technology are creating operational, financial, and sales distribution efficiencies.
Part of our future growth plan includes building cross-channel and cross-company partnerships with Integrated Software Vendors, technology providers, and resellers, which will result in a disruptive shift in how Fintech companies serve their clients’ needs.
Q. Morgan M.
With the rise of digital payments, AI, and blockchain, what role do you see these technologies playing in the future of payment processing, and how is Simpay preparing for these advancements?
A. Lazaros K.
There’s a terrific book called, “Same as Ever: A Guide to What Never Changes” by Morgan Housel. The author makes two important points: 1) certain things never change 2) the things that do change are nearly always unpredictable. Who could have foreseen COVID and the impact it had on the economy? Businesses needed to pivot, innovate, and learn to execute their core competencies in completely different ways almost immediately.
We can’t know what the impact of AI or blockchain or whatever those other “unknowns” are, but we can make our companies nimble and agile. That’s the real key differentiator for me. We’re examining everything we do and asking why we do it that way. Are there alternatives? Can we find efficiencies? I’m interested in asking the questions no one has thought of yet.
Over the past three years, Simpay has more than tripled its employee base, making the company more diverse and more skilled. We seized upon the opportunity brought about by the pandemic to decentralize Simpay’s reliance on local talent. We have onsite, hybrid, and remote employees. The result is an agile workforce spread across thirty states and three countries.
By investing in skilled personnel behind the scenes and product expansions end users find beneficial to their daily operations, attrition rates have fallen well below the industry norms. These results have been achieved, in part, by real people working closely with clients, taking a personal interest in their success, as well as employing smart technologies to drive repeatable, consistent results.
Q. Morgan M.
Simpay offers a range of services from payment processing to HCM, payroll, and many other solutions. How do these integrated solutions simplify business operations for your clients, and what kind of impact have you seen on their efficiency?
A. Lazaros K.
Simpay is growing its market share by deepening and strengthening its relationships with its client base. Our clients rely on Simpay’s growing and innovative Total Business Solutions platform to access essential services, creating efficiencies, increasing local market presence, and reducing costs. To borrow the phrase, “The proof is in the pudding.” Our client base continues to grow, product adoption is up, and portfolio attrition continues to drop.
We recognize the importance of cementing merchant-level interactions, often seen as transitory by other providers in the space. Let me put that in real plain terms. We talk with our clients, not at them, then we listen to their feedback and make changes. We develop programs with their wellbeing in mind first as opposed to just looking for another revenue stream. And because of that, Simpay’s per client value and monthly recurring revenue have both increased well beyond industry norms.
Q. Morgan M.
As businesses continue to demand more streamlined and efficient services, what do you foresee as the next major innovation or development in the integrated solutions space, and how is Simpay preparing for it?
A. Lazaros K.
Artificial Intelligence will have a huge impact in how consumers learn about new products and services, and will, to a large degree, be responsible for how those customers interact with the products (and companies behind the products). That’s the “merchant facing” innovation we’re preparing for.
Behind the scenes, we’re preparing for even greater data security. As business shifts and is conducted virtually, assisted by AI, the more we’ll be responsible to maintain sensitive customer data and financial information. Data privacy will become even more important.
Q. Morgan M.
Early last month Simpay announced plans to offer more voluntary residual buybacks with the flexibility to convert residual income into immediate financial liquidity. What has the response been from ISOs and Direct Sellers, and how do you see this program shaping their long-term financial strategies?
A. Lazaros K.
We’ve always believed in vested, portable residual portfolios. If the time comes for an ISO or Direct Seller to liquidate their book of business, I think they should be able to sell it whenever and wherever they choose. In 2023, we offered generous, voluntary, residual buybacks and the response was overwhelmingly positive. Sellers could elect to sit on their residuals, sell part of their residual stream, or convert it all at once into a lump sum cash payment.
Much like everything else we do, we wanted the process to be simple, transparent, and fair. That’s truly where the success stems from. Interested parties asked for an evaluation, we made an offer, and those that accepted were paid in about five business days. We now have folks coming to us, asking to buy other residual streams they’ve built elsewhere, and we are actively acquiring portfolios.
What’s been wonderful to hear after the fact are the stories of folks realizing their dreams of financial freedom, purchasing a new house, paying for their kids’ college tuition, or creating generational wealth for their families down the road.
Q. Morgan M.
Simpay has been recognized by Inc. Magazine for its rapid growth multiple times. On the other hand, what significant challenges exist for Simpay over the coming years? What keeps you up at night?
A. Lazaros K.
I have an incredible wife, four daughters, and am a two-time cancer survivor. I’m grateful for every day I have with them. So, in the great scheme of things, not much keeps me up at night. I have it pretty good.
There will always be significant challenges for any company looking to grow, especially in a mature marketplace. We’ll keep working on our technology and creating products and services that meet what businesses are yearning for.
Our challenge, believe it or not, is about growing at “the speed of right”. We could add a hundred more sales people, or quadruple our merchant account boarding, and drive huge profits (and we will) but we don’t need to do it all at once. We have a strategic growth plan, formulated by the shared vision of our leadership team and all Simpayans. It absolutely includes increasing our MID count and is tempered by the understanding that our infrastructure must grow at the same pace. We will make acquisitions, and also invest in the technologies and people that will ensure those acquisitions happen smoothly and net the results we’re looking for.
We will drive profits and take the necessary steps to allocate our resources responsibly throughout the organization. We’ll expand the services we offer our clients as long as there’s a real benefit to them. We won’t sacrifice our core values of providing great services that are fair and transparent.
Part of our long-term strategy revolves around the duty of care we have to the Simpayans who give their all for this company, which is why we created the Simpay Value Sharing Plan. Employees at all levels participate in the plan. The value plan allocates “units” to all qualified employees and provides a real financial incentive and reward. In the event Simpay goes public or is acquired, everyone participating in the program will receive a portion of the proceeds. This program will generate potentially life-changing wealth for many of our teammates, so it’s incumbent on me and all of us to challenge and question the status quo and reward introspection and innovation.