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, TSG marketing team member Rachel Hartley spoke with Matt Morrow, Chief Revenue Officer of Xplor Pay (Clearent), about data-driven decision making, and the evolution and future of the fintech landscape.
Bio: Matt Morrow, CRO of Xplor Pay, has over 15 years of commercial leadership experience in payments and industrial technologies. With a proven track record for building and implementing high growth go-to-market strategies, Matt led teams that have powered organizations like Bank of America Merchant Services, TSYS and Danaher to achieve their strategic objectives. He’s passionate about creating cohesive and diverse teams that excel at building for the future, through strong, lasting partnerships.
Q: Rachel H.
Given your extensive experience in payments with companies like TSYS and Bank of America Merchant Services, what aspects of the payments landscape continue to captivate your interest, especially in the context of the evolving fintech industry?
A: Matt M.
When I entered the payments space in 2012, my colleagues told me a revolution had started. I was told that “software is eating the world” and that I was now a participant in the era of disruptive innovation punctuated by the expansion of bring-your-own-device mobile payment solutions and the beginnings of the ubiquitous Payment Facilitation model for software providers. It was an exciting way to get started in payments.
While at Bank of America Merchant Services, I was fortunate to contribute to the pilot and initial launch of a disruptive, general-purpose point-of-sale platform. Still, at TSYS, the macro trend came into focus: the 20+ year proliferation of industry-specific business management software (“BMS”) solutions for SMBs was changing payments forever.
Embedding payments in software solutions across various industries has been a passion. Building the sales and service models, delivering the product and technology. This continues to captivate my interest in the industry.
Q: Rachel H.
As the CRO of Xplor Pay, what leadership principles or strategies do you believe are crucial for driving both short-term revenue goals and long-term sustainable growth in the competitive fintech space?
A: Matt M.
We are a full-service processor for almost 60,000 merchants and hundreds of active partners in the United States. We are a payments provider for another 15,000 merchants through Xplor Technologies’ business management software solutions worldwide. It is important that we make informed and timely decisions.
We have made open, honest, and productive communication a priority. This applies across our leadership team and up and down the organization. Very early on, we implemented the kind of routines that would create space for open dialogue at all levels of the organization and established the principle that delivering bad news was okay.
At Xplor Pay, we have made data central to how we talk about our business. We have installed robust leading indicators for each part of the business and a robust data analysis framework to understand our results. We utilize TSG’s AIM database and analysis tools regularly to help broaden our view of trends and assist us in contextualizing what we see developing in our portfolio.
Q: Rachel H.
What unique strategies does Xplor Technologies leverage that sets it apart from its competitors in terms of revenue generation strategies and customer value?
A: Matt M.
Xplor Technologies comprises business management software in several regions, most notably the US, parts of Europe, the UK, Australia, New Zealand, and Japan. We deliver in “everyday life” verticals such as childcare, gym and studio management, field services (think repair contractors and lawn services), and dry cleaning. Across these regions and verticals, Xplor Pay is an embedded service that helps those businesses collect payments from their customers at the point of sale through invoicing or ongoing subscription management services.
We see this evolution of software and payments, and we prioritize continually enhancing the interaction between consumers and businesses. We are fortunate to have one part of our business relentlessly pursuing software innovation and the other delivering needed payment technologies, allowing us to come together positioned to achieve the best outcomes for our customers and their customers.
Q: Rachel H.
Could you shed light on the key performance indicators (KPIs) or metrics that Xplor Pay uses to measure the success of its revenue generation strategies? How do these align with the broader goals and vision of Xplor Technologies?
A: Matt M.
Xplor Pay has several sets of KPIs depending on the part of the business we are talking about. Our primary set includes new account activations, attach rate, take rate, account volume, same-store sales trending, and retention levels. These are familiar metrics in the payments industry and help gauge our direct portfolios’ health and growth trajectory.
In our partner channels, we also look at new partner success rates like time-to-revenue, which helps us understand how easy it is to integrate and launch with Xplor Pay. We have adopted a “new from new” metric, which measures new account production for our most recent partners and compared with previous years, helps us evaluate our business development execution and the vitality of our portfolio growth.
While each channel strategy has its own metrics, they illuminate how successful we are at growing the overall Xplor Pay business sustainably. Xplor Technologies counts on Xplor Pay as an internal expert on payments to ensure BMS products achieve their potential with payments. This mix of KPIs ensures we deliver great outcomes.
Q: Rachel H.
How has the company’s revenue trajectory or strategy changed since you started in your role?
A: Matt M.
I joined Clearent in Q3 of 2019. A lot has happened over the past four-plus years, given the market dislocations and subsequent recoveries in the wake of the global pandemic. I’m proud to say our Xplor Pay team has successfully doubled the business in the US over those four years. In early 2021, Clearent merged with Transaction Services Group to form Xplor Technologies, with our payments business now called Xplor Pay, and this has allowed us to serve a larger international business.
When I joined, our primary objective was to take what we had learned from some early ISV partnerships and the integration of three software acquisitions (SPOT, FieldEdge, and Service Autopilot). Then rapidly accelerate our integrated payments portfolio by partnering with additional ISVs. This part of our business has grown substantially over the last four years. It continues to be the cornerstone of the overall growth story. We are now establishing our global payments gateway to better align to the needs of software providers across several international markets.
Q: Rachel H.
What are the key challenges and opportunities you foresee in terms of driving revenue growth in the upcoming years?
A: Matt M.
Embedded payment technologies continue to evolve. It is essential to our partners and our Xplor BMSs that we stay innovative and responsive. Post-merger, Xplor now has multiple processing platforms in several regions worldwide. One of our biggest challenges in the coming years is to bring the various platform capabilities together in a cohesive and valuable way to our growing portfolio of international partners.
Our international footprint allows Xplor to pursue relationships with international ISVs and merchants. This aspect of our business is accelerating, and we are investing to ensure we can meet these new, more sophisticated needs.
Q: Rachel H.
Fintech is a rapidly evolving space. How does Xplor foster innovation in its revenue generation strategies to stay ahead of the curve? Are there specific initiatives or processes in place to encourage a culture of innovation within the company?
A: Matt M.
We are very focused on delivering on the needs of our ISV partners and the demands of our owned SaaS platforms. Over the last few years, there has been a rush to payment facilitator platforms. While that can be the right solution for some SaaS providers, it isn’t a panacea that can automatically deliver attach rates with utilization and attractive wallet share for all software solutions in all vertical markets. Xplor Pay continues to invest in customer-facing teams with the primary goal of helping our software partners. Helping them to engage with their client base meaningfully, with marketing support, outbound sales, and thought leadership pieces. The goal is to drive awareness, adoption, and utilization of integrated payments.
We recently helped an ISV 10x their average account size by leveraging a better payments solution. We also provided them with outbound capacity to talk to their customers. They hadn’t invested in a payments attach team. They needed more than an API library to have a successful payments program, and we could provide them with exactly what they needed to grow their business.
Q: Rachel H.
In the next five years, which fintech trends do you anticipate gaining significant traction or prominence?
A: Matt M.
I am terrible at predicting the future. Anecdotally, when mobile phones started shipping with integrated cameras, I didn’t see the point. Given the number of pictures of my kids in our iCloud account today, I can confidently say that you should have little confidence in my predictions.
That said, we will continue to see the trends we have seen over the past five years continue. Here are two predictions:
- Non-Integrated Card Terminals will go back into decline. Alternative pricing schemes breathed new life into the inefficiency of standalone terminals. With recent rule adjustments, such as a lower cap on surcharging, and more consistent rule enforcement. The financial benefits of non-integrated processing have diminished compared to the efficiency of integrated processing.
- Software company valuations have been buoyed by any opportunity to introduce or improve an integrated payments program. Over the next five years, as integrated payments become ubiquitous, the focus on embedded finance will accelerate. ISVs have a growing influence on the financial services decisions of their customers. Savvy operators and investors will look for a product roadmap that takes advantage of this trend.