Payworks: Precipitate Vs. Practical Growth

Payworks is taking a deliberate approach in navigating an ecosystem that is swirling around it, tempting similar and larger providers to delve into many different spaces. Payworks, however, seems self-assured and is taking its time to enter emerging markets.

Payworks‘ gateway technology, Pulse, wants to provide the lifeblood to point-of-sale transactions for merchants using EMV, contactless and mobile wallets. The company just announced $4.5 million in Series A funding from investors Rumford, HW Capital and Speedinvest.

PYMNTS caught up with CEO Christian Deger to find out what keeps Payworks “pulsing” away in the global payments market of gateway providers.

Payworks was founded in 2012 by Deger, David Bellem, Johannes Lechner and Simon Eumes. Based in Munich, the company is taking on the European POS gateway technology market and has recently opened its U.S. headquarters in Austin, Texas.


What Is Payworks Doing Differently?

Payworks provides solutions to acquirers and payment providers but not directly to retailers. Its solutions are platform-agnostic, and according to Deger: “Our payment gateway technology is more open and more flexible than those from traditional providers. Our cloud technology integrates EMV card readers and NSV card readers into a POS application, whether that’s node-payments, iOS or Android operating systems.”

The company is also removing the administrative hassles that can accompany the integration of payments to a POS: the NDA, the 50-page PDF document and certification — all of which can amount to a 9- to 12-month integration time. According to Deger, Payworks offers a drag-and-drop integration for a POS application, EMV integration and pre-certification with different acquirers.

This is nothing new in the POS space, so what is Payworks’ appeal? Payworks seems to know where its strengths are and is not trying to do too much too soon or venture into market areas too quickly.

According to Deger: “While a lot of companies are really developer-focused in the internet space — Stripe, for example. We do well in the POS space.”

The challenge for Payworks is to keep up with a POS market that is increasingly mobile and flexible. Deger is noticing that there is no one payment solution and that merchants need a variety of solutions.


No One-Size-Fits-All In Payments

When asked about specific trends that he is noticing in the marketplace, Deger said: “If you are a big merchant, you want to implement a POS that gives you a variety of different opportunities to have both a standalone cashier system or a stationary cashier system but also a mobile system.”

Another trend noticed by Deger is that payments gateway technology is not limiting itself to seamless transaction processes but is now entering the business intelligence and loyalty space.

“Merchants want a holistic solution, and a lot of companies building those solutions don’t limit themselves to a cashier system, but they are also going into shopper analytics and loyalty,” said Deger.

On the security side, EMV’s burgeoning growth in the U.S. is requiring the unification of global terminals and is making card security a big challenge for Payworks.


Precipitate Vs. Practical Strategies

The mindset of technology startups is to achieve rapid growth quickly, and the POS space offers that opportunity, according to Deger.

“If you look at the tech space, a lot of companies are growing and going international very quickly. Basically, they go into one country a week, and a lot of those companies are also entering the POS space, such as ShopKeep and NewStore. This puts a requirement on tech providers to be closer and to be international.”

Already in 15 markets in Europe and the U.S., Payworks is seeing increasing interest in Asia and has a few projects in Africa. But exhibiting a patience that few startups possess, Deger emphasized: “Our main focus is the U.S., the U.K. and Europe for now; we’ll see how that changes over the years.”


New PYMNTS Study: Subscription Commerce Conversion Index – July 2020 

Staying home 24/7 has consumers turning to subscription services for both entertainment and their day-to-day needs. While that’s a great opportunity for providers, it also presents a challenge — 27.4 million consumers are looking to cancel their subscriptions because of friction and cost concerns. In the latest Subscription Commerce Conversion Index, PYMNTS reveals the five key features that can help companies keep subscribers loyal despite today’s challenging economic times.

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