Company Description:
- Processing.com is a payment services provider focused on providing e-commerce merchants payment processing solutions and services that allow for the acceptance of online payments in multiple currencies around the globe
- The Company utilizes a proprietary payment processing platform to connect its customers to an extensive network of bank partners
- In addition, the Company deploys industry-leading security and fraud analytics as well as real-time reporting tools
Sourcing/Transaction:
- Nick Christopher identified payments as a compelling technology niche due to the rapidly evolving state of the industry, high fragmentation, and emerging growth of e-commerce and mobile payments
- Through marketing our interest in the space to business owners and intermediaries, Ryan was connected to a boutique investment bank in Baltimore that was taking an e-commerce payments business to market
- We were able to establish our focus on the space with the co-founders before the process began (meeting them at an industry conference we were covering), eventually leading to our selection as the ideal financial partner
Investment Thesis/Opportunity:
- Back management to execute an organic growth strategy; coupled with the institutionalization of the business to allow it to scale, create a leading e-commerce payments services provider focused on high yield merchants
- As e-commerce transactions expand rapidly on a global scale, the opportunity to provide services to niche markets ignored by traditional payment processors presents highly compelling investment opportunities
- Processing.com fit well with our thesis to grow a vertically-focused processor serving small e-commerce merchants
Growth Strategy
- Immediately upon acquisition we invested in additional human capital, built out technology, implemented operational improvements, and built a global sales team to scale the business rapidly
- In addition, we focused management on targeted industry verticals – creating a unique payment processor focused on small e-commerce merchants in niche end-markets, providing value to the e-commerce merchants through access to processing volumes and data analytics, while providing credit underwriting and merchant oversight to our acquiring bank partners
Deal Highlights
- Headquartered in Los Angeles, CA
- Organic growth strategy in an evolving market
- Partnered with management to invest in technology and infrastructure to help the business scale; built out a global sales force
- Sales and EBITDA down as market forces caused a correction, but positioned for a rebound
- Acquired June 2016
- www.processing.com
