Power in numbers: a new way for ISO's to scale
There's a lot to consider when selling a portfolio or residual stream. Many ISOs would say, "I've worked hard to build this book of business; I want to continue to grow, and I don't know if I should borrow against my portfolio or sell it for less than I think its worth." Additionally, selling an entire portfolio may result in starting over from scratch, with no recurring revenue, high overhead and even higher burn rates.
Darrin Ginsberg, Chief Executive Officer at Super G Funding, and Sabin Burrell, CEO of BlueSquare Resolutions, have helped large and small clients navigate these difficult decisions and find creative ways to grow their businesses. Among their many approaches to financing, flexible debt and equity options enable Super G Funding & BlueSquare to structure deals that are extremely customized for business owners.
"After years of organically building several ISO's and both purchasing and selling ISO's and Portfolios, I wanted to tailor solutions for ISO's that enabled them to continue to own their book of business and yet give them some liquidity or growth capital for the business," Ginsberg said. "As part of our business, we work with our clients and partners from initial funding through execution to ensure the best outcomes for their businesses."
Throughout his twenty-three years in the payments industry, Ginsberg actively promoted best practices in the ISO and funding communities, mentoring business owners, ISO's and merchant level salespeople (MLSs) along the way. Through these efforts, he met Sabin Burrell, CEO of BlueSquare Resolutions, one of the most active portfolio residual buyers in the marketplace.
"Sabin and I met, became friends, shared a few secrets of the bankcard business, and eventually did a few deals together," said Ginsberg. "After becoming familiar with each other's business styles, we have joined forces to offer a full suite of services related to financing ISO's and processing services."
BlueSquare Resolutions, one of First Data's largest ISOs, aligned with Super G Funding in 2016 and between the two entities have funded over $90 Million to approximately 600 ISOs in amounts ranging from $25,000 to $5 million in addition to purchasing and selling over $100 million dollars of portfolios Blue Square and Super G are now breaking the mold of typical portfolio acquisitions, using their combined expertise to create tax-efficient structures for its ISO partners that allow them to continue to grow their businesses while increasing their respective margins.
"The larger you are, the more diverse your portfolios are," Burrell said. "A liquidity event can help enterprise-scale partners take some chips off the table; and a BlueSquare partnership can help smaller ISOs leverage our pricing and reduce operational expenses."
Partner, grow with us
Both Burrell and Ginsberg see their program's open-endedness as a true differentiator. From its onset, the strategic partnership of BlueSquare Resolutions and Super G Funding was designed to support growth and innovation, welcoming new partners and fresh ideas. They attracted Jeff Brodsly, CEO of Chosen Payments, a Los Angeles based First Data ISO. Inspired by their entrepreneurial spirit and vision, Jeff became an early adopter and ultimately a partner, adding his expertise as an ISO originator to the partners' finance and portfolio acquisition experience.
Brodsly was the first to partner with Super G Funding and Blue Square Resolutions, but certainly not the last. "Darrin had been a mentor to me for four to five years," he said. "When I saw the opportunity to partner with him and Sabin, and fully understood the potential we have working together, I didn't hesitate." The partners pooled their talents for the greater good, leveraging their individual expertise and resources. Brodsly still owns 100 percent of Chosen Payments, where he has consistently achieved large year-over-year growth, making First Data's coveted Presidents Club four years in a row. As a processor for some of the world's leading retailers, he has established partnerships in select vertical markets and with the ISV community.
"I recently reached an inflection point in my business, where I realized a majority of my net worth was in one company, Chosen Payments," Brodsly said. "I wanted to take some chips off the table and diversify myself while keeping 100 percent of my company and not impacting my clients." Working with Burrell and Ginsberg to structure the perfect deal for his company made Brodsly want to share his story with other ISOs, noting, "As an ISO, you're working hard every day building your business, and rarely see the fruits of your labor other than making a comfortable living; so why not diversify your risk and put some money aside for your future or your kids, use some grow capital to improve operations of your ISO and not get stuck on the hamster wheel?"
Recent Mercury/Vantiv and Heartland/Global mergers clearly demonstrate that everyone is rolling up, Brodsly said. What happens to the small and medium guys who have to compete with bigger processors? By joining the collective, we can leverage our own economies of scale and help each other grow, he added.
Become your own multiplier
"It's no secret that ISOs can use better pricing, better support, better technology, financing, and/or advisory services," Brodsly said. "I look forward to welcoming other like-minded ISO's to our team."
Recognizing the increasingly complex needs of today's ISO to stay competitive, this strategic partnership can customize liquidity options and growth services for ISOs, including:
"It takes more than a quarterback to win a Super Bowl," Brodsly said. "It takes collective talent, expertise and focus to carry the team to a major victory. And that's exactly what we can offer you, as part of our ISO Super Bowl team. Join our collective, leverage our resources, utilize our technology, get way better pricing, and keep your brand."