Hartford Business Journal

www.HartfordBusiness.com April 17, 2017 • Hartford Business Journal 3 With new CEO, Payveris building on its digital-pay perch By Gregory Seay gseay@HartfordBusiness.com O nline-mobile payments vendor Payveris LLC recently received the last chunk of a $10 million investment that, while opening doors to new customers, could finally land the five-year-old Connecticut startup in the black this year, its new CEO says. Banks and credit unions (CUs) are the primary customers for Payveris, based in Rocky Hill, said Ron Bergamesca, a veteran marketer recruited back to Connecticut to head Payveris as of Feb. 24. Payveris essentially is a cloud-based, software-as-services provider whose digital business-to-business — B2B, for short — payment technology allows financial-insti- tutions' depositors to pay their bills or move money around using personal computers and smartphones, almost instantaneously. "We are a [business] to [business] to [consumer] play,'' Bergamesca said. "We're the only independent digital-payments and money-management platform serving financial institutions." Using the final $3 million slug of its series C investment from a San Francisco group, together with Connecticut taxpayers' $2.3 million investment stake, and a $1.25 mil- lion low-interest state loan, Payveris wants to double its roster of bank-CU clients to 400 by 2018, Bergamesca said. Doing so, could finally make Payveris profitable by then, if not sooner. Payveris and its larger American rivals compete in a global electronic-payments market — one the U.S. dominates — that accounted for more than 144 billion trans- actions with a value of almost $178 trillion in 2015, allowing consumers to pay bills or make other payments in person or online, according to Atlanta digital-payments con- sultant Randy Pilkenton, citing the 2016 Fed- eral Reserve Payments Study. In exchange, Payveris and other B2B and person-to-person (P2P) e-pay vendors drew some $300 billion in swipe fees at retail points of sale and fees from customers sending payments or moneyfund transfers, Pilkenton said. Another Connecticut digital-payments vendor, Higher One Inc., also competes in the sector, providing its money-transfer services primarily on college campuses. "That's why it's so big," Pilkenton said, "because so much of our commerce pay- ments are being facilitated electronically.'' Pilkenton said "disrupters'' like Payveris, eBay spinoff PayPal, and P2P digital-pay pro- viders such as Facebook Pay, Google Wallet and Snapcash, are shaking up the digital- payments space. "In some ways, they're just delivering on a service that's already available," he said. "But they're taking advantage of the opportunity to rethink that service and ways to make it better for customers.'' Customer growth Payveris competes in a financial-trans- action marketplace against a handful of larger players: Fiserv, FIS and Jack Henry & Associates. All rely on the Automated Clearing House to move money and informa- tion between banks and payment end points. Bergamesca, who previously worked for other Connecticut companies in the '80s before leaving the state in the '90s, said that's precisely Payveris' strategy. "There's definitely a market for what we have,'' he said. "The 'big three' are leaving a big part of the market unsatisfied. … What our focus is on is how fast can we get out to the market and do we have enough resources to take advantage of the opportunities.'' Co-founded in 2011 by serial Connecticut/ New England technology entrepreneur Louis Hernandez Jr. and other Connecticut and U.S. investors, Payveris officials are tight-lipped about the closely held enterprise's financials and its customers, or "partners.'' Last October, Payveris inked a deal with Southington financial-technology provider COCC to offer its PayItNow services to COCC's 130 bank-credit union customers in the North- east. The service allows community lenders to offer their customers P2P money transfers. Earlier this month, Payveris announced the signing of Utah's Members First Credit Union, a $113 million-asset credit co-op whose 14,815 members include workers at NUCOR Steel and Utah State University. In a statement, First Credit finance chief Darryn Hodgson said Payveris' digital-pay- ments platform "provides our members a much better online and mobile user experi- ence and it allows us to easily add additional digital payment services in the future at a much lower cost than our previous solution." According to Bergamesca, Payveris will help its 200 U.S. financial-institution custom- ers facilitate moving about $2 billion for their depositors this year, double 2016's volume. "The last three years, we've doubled our transaction volume each year,'' he said. More volume means more revenue for Payveris, which collects an unspecified fee for each fund transfer. In 2016, Payveris added 85 new financial clients, and is expected to add fewer but larger clients this year, Bergamesca said. Recently, Payveris landed as a client one of "the top five banks in Connecticut,'' he said, declining to name it. State assistance Beyond banks and CUs that distribute its services, the Payveris name is a virtual unknown to depositors and billpayers. More familiar to them likely are Payveris' product stable, including ePay, PayItNow Network, and Transfers. Payveris' pitch to prospective financial-tech- nology customers is simple, Bergamesca said. Continued MOBILE MONEY Payveris LLC CEO Ron Bergamesca. 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