The world of payments is constantly evolving, with new technologies and shifting business demands reshaping how money moves. But what does it truly take to thrive in this dynamic environment?
In an interview with Karen Webster, CEO of PYMNTS, Paulette Rowe, CEO of Stax, pulled back the curtain on the critical strategies and innovations driving the next wave of payment partnerships.
Rowe emphasized that for businesses, the goal isn’t just growth, but profitable growth. She noted, “You want to grow, but you also want to make sure you’re not seeing churn on the back end of what you do.” This sentiment underscores a critical shift in focus for many companies, moving beyond simply expanding their customer base to ensuring long-term customer retention and healthy profit margins.
One of the biggest hurdles businesses face, according to Rowe, is sustaining growth in increasingly niche vertical markets. “For a lot of our companies, particularly the ones that have been successful, it’s how do we keep growing? And then also, there’s much more focus on, don’t just grow, but grow profitably. So how do we do that?” Her solution? Deep integration and leveraging payments as a new revenue stream. “Payments can be really important as a way of helping those companies drive additional revenues that they wouldn’t otherwise see, because they wouldn’t normally participate in those payment streams.”
The interview also highlighted the rapid pace of technological advancement, particularly in AI. Rowe shared that Stax actively engages with its partners through initiatives like their Partner Advisory Council and is even planning a joint hackathon with partners to explore AI’s potential in streamlining payment experiences and broader business operations.
Another crucial area where Stax provides expertise is go-to-market and pricing strategies. Many SaaS companies struggle with optimizing their pricing models and merchant acquisition efforts. Rowe pointed to the increasing popularity of subscription payments as a way to “allow for more stickiness” and “more convenience for the consumer.”
Partnering for Success
A central theme of the interview was the strategic decision businesses face: “do you partner, do you build, or do you go and buy?” Rowe candidly admitted that while ISVs excel at selling their own software, selling payments can be a significant challenge, often resulting in low payment attachment rates. This led Stax to launch Stax Connect Plus, a service where Stax’s in-house sales experts assist partners in cross-selling payment solutions.
The results speak for themselves. Rowe shared that early adopters have seen “a doubling of their payments revenue” by leveraging Stax’s sales capabilities. She likened the “do it yourself” approach to payments to a “do not try this at home” scenario, stressing that it’s “such a shame because for many companies in the vertical SaaS space, they do all their homework… and then they wait for the revenues to come, and then they’re a sub 20% payment attachment.”
Building an End-to-End Experience
Stax’s commitment to “driving customer success” is paramount, extending beyond cutting-edge technology to encompass a complete end-to-end payment experience. To achieve this comprehensive control and enhanced agility, Stax strategically acquired companies like APPS and BlockChyp. These acquisitions were pivotal, creating the robust in-house “rails” for Stax Processing. This deliberate move, as explained by Rowe, aims to “remove our reliance on third parties, so that we can be much more nimble, much more responsive, cheaper, because we’ve got all of the core competencies in-house.” This strategic vertical integration by Stax allows them to quickly adapt to new use cases and provide unparalleled flexibility to their partners, ensuring a more seamless and efficient service delivery.
Unlocking Opportunities in Underserved Markets
Looking ahead, Rowe identified significant growth opportunities in vertical markets still heavily reliant on traditional payment methods. She specifically highlighted the care home and property management sectors, where “there are still so many checks.” The push for digital transformation in these areas is driven by the demand for convenience from family members making payments, as well as the inherent cost and error reduction associated with moving away from physical checks.
Another promising area is specialty healthcare, which presents unique omnichannel payment needs and evolving risk profiles. Stax’s ability to control its own processing and bank relationships allows them to navigate these complexities and support partners in emerging use cases.
A Vision Shaped by Experience
Rowe’s extensive background at financial giants such as Barclays, Facebook, and PaySafe has profoundly influenced her leadership at Stax. Her experience at Barclays revealed the growing desire among small businesses for embedded, “one-stop-shop” solutions. At Facebook, she witnessed firsthand the power of integrating payments seamlessly into commerce.
Ultimately, Rowe’s vision for Stax is to empower businesses by making payments effortless. “If you can help commerce by making it easier for small businesses to not have to sweat the small stuff and to just run their businesses, that to me is… a really important goal.” This commitment to simplifying payments allows businesses to focus on what they do best, driving innovation and growth in the digital economy.
Watch the full interview with Paulette Rowe and PYMNTS here:
