PayEngine, a payments platform for vertical SaaS companies, has raised $10 million in Series A funding led by Point72 Ventures, a global venture capital firm.
Leading capital equity firms Mucker Capital, BAM Ventures and K5 Global are also participating in the investment. The Los Angeles-based white-label B2B payments facilitation platform will expand its team and develop more financial product offerings with support from Point72 Ventures and other strategic investors.
The PayEngine platform offers companies the ability to increase annual recurring revenue (ARR) by 30% or more, by allowing businesses to set their own merchant rates. This way, they retain the majority of their profit while eliminating the merchant-of-record liability and implementation complexities that are traditionally associated with other payment facilitation models. As a custom white-label offering, the platform can be branded for client use and can be integrated alongside a company's other core software products in a matter of days.
“Software companies have the opportunity to generate additional revenue from payments flowing through their platforms, but most lack the resources or desire to become a payment facilitator (PayFac) given the complexity and resources required," said Adam Carson, operating partner at Point72 Ventures. "PayEngine is a PayFac-as-a-service platform that enables software companies to monetize the payments flowing through their platforms quickly and easily."
Maintaining control of the data, the transaction, and the card or financial tokens, all put the vertical SaaS back in the center of the chain. The SaaS company can better serve its merchants directly by offering significant opportunities for improvement, additional revenue, and strong products. This is starkly different from outsourcing the entire payments infrastructure, where the SaaS company has little autonomy and little to offer for competitive differentiation.
PayEngine's platform helps SaaS companies across a range of verticals, including home services, automotive, construction, healthcare and transportation, improve their payments monetization strategies while mitigating Merchant of Record (MOR) liabilities and data security and compliance issues.
PayEngine is excited about its future in developing great financial products for the vertical SaaS market. Vertical SaaS itself is an exciting space where great companies are improving each and every industry and niche market. By serving this market directly, PayEngine sees itself as a key supporter of software that makes all of our daily lives better. Stay tuned as PayEngine puts its Series A to work.