Live with Square: The New ISO Program Explained | Live Replay

[00:00:00]All right, everybody. Thank you for jumping on this event. We still got a lot of people joining and as they do, I've got a question for you that I would love to get the answer to. So, it's a very simple. It's a yes or no question.

[00:00:10]You can put it in the chat. The question is, have you already sold a deal uh with Square? So, a yes or no question. So, I'm interested how many of you are already a Square reseller and you've already made at least one sale. I'm just curious who I'm talking to today. How many of you are like, "Yeah, James, I already got it. I know what I'm doing here." Um, so just a yes or a no. Um, so yes, I have sold a deal with Square or no, I have not. Let me see what we got here while we're waiting on people to jump in here.

[00:00:45]I'm just curious how many yeses we have.

[00:00:47]That's what I really want to see. Okay, we got quite a few yeses. All right, good. I'd say we're probably about maybe 10%, maybe 15%.

[00:00:57]So, oh yeah, here's some more down here.

[00:00:58]Yeah, maybe 15%.

[00:01:01]All right, cool. Great. Yeah. So, again, if you just jumped on right now, the question I'm asking is, um, have you sold a deal for Square yet? Like, are you already part of their reseller program, whether that's directly or as a sub agent? Um, and have you already made a sale? So, you've already made a sale, it's yes. If you have not made a sale yet with Square, whether you just haven't signed up or you signed up and haven't made a sale, that would be a no.

[00:01:24]Uh, cool. Awesome. All right, everybody.

[00:01:27]So, we've got a a full house. I'm going to go ahead and jump in and get started.

[00:01:31]Again, my name is James Shepard if you uh if you do not know me. Um and uh most of you know me with CC Salespro, Merchant Sales Podcast, all of that. So, I want to give you just a really really quick background here with Square for me. Um so, obviously I've had a lot of respect for Square over the years and what they've done. I I'm a big fan of the innovator's dilemma that book and I kind of feel like Square has just com you know basically personified that for our for the payment space uh they came in with a very simple easy to use disruptive uh model and they went down market to kind of those smaller uh merchant accounts and they did great and meanwhile the legacy players all kind of ignored them and we were all like ah Square for these tiny little merchants we don't care about Square we're not worried about that, right? Um, and then all of a sudden we started going, "Wait a minute, that was that was my merchant.

[00:02:24]I they got a Square device. What's going on here?" Right? And what's happening is Square was adding features. They were growing functionality. Uh, and they were starting to take th those core accounts.

[00:02:35]And so, fast forward today and Square has a huge suite of products and solutions. Um, and so when I heard about Square rolling out their own reseller program and and full transparency here, I'm kind of the disinterested party on this event. I'm not a Square reseller.

[00:02:50]Um, but when I saw this, I'm like, this is going to be very very interesting.

[00:02:54]And so I've been talking to a lot of people about it. Um, obviously a lot of interest and curiosity in the industry.

[00:02:59]So then recently I was talking to uh Vlad and Tibo. So, Order Out and Nivia and both of these companies are doing some very interesting things with the Square uh within the Square ecosystem, which we're going to talk about here in a little bit. And so, I thought, well, you know, it' be great if we could get an event, get Mike Collins on, who I'll introduce in a minute, who's actually running the program, and let's just talk about this program. Like, what is this program? How does it work? Um, and then also, uh, for those of you that aren't familiar, the the actual going direct to Square, that program is, uh, has been closed for for the time being. So, you can't go and sign up direct. And so, I was also wanting to talk to because I know Order Out has an interesting program there that allows you to resell for Square even though the direct program is closed and it's similar economics, which we'll talk about. So, the idea for the event today is I'm going to talk to Mike Collins. We're going to get some highle information about Square and this reseller program.

[00:03:51]I'm going to then talk to Vlad and uh have him share what he's doing in the ecosystem. Then we're going to go to the orderout team with Tibo and then uh Brian to talk about um how you could actually partner with Square if that's something that you're interested in doing. Um and so really looking forward to that. So without further ado, let me get Mike Collins on here. So Mike, if you want to get your camera and audio set up, awesome. Mike, thank you so much first of all for for joining uh this evening. I really appreciate you taking the time out of your busy schedule to talk to all of us today. Yeah, I'm excited. And actually, I love the question that you posed in the beginning and my favorite answer actually was the not yet. That was my favorite answer.

[00:04:26]>> Yes, I saw quite a few of those.

[00:04:28]>> Yeah. Yeah. Yeah. Absolutely. So, Mike, tell us who you are. What What is your history? How did you get into the crazy payments industry and how did you end up uh running a reseller program for for Square?

[00:04:38]>> Yeah. Yeah. So, uh been doing it since 2007. So got into the business probably like most through a buddy or you know a friend that was out doing it. Um anyways ended up uh starting my own ISO uh which ran for a number of years. Um I appreciate that picture of me too by the way. That was last week. There were some questions like when was that picture taken? [laughter] The answer is last week. Um but uh yeah so ran ran my own shop for a number of years. Uh learned a lot. had some level of success with it.

[00:05:14]Uh had plenty of challenges and failures along the way, but it was a wonderful experience for me. I've uh done a couple things uh since then. Uh I led the financial institution channel at Tesus uh directly for a number of years. Uh most recently was at SpotOn. Uh helped build and and grow the uh reseller channel at at Spoton for a number of years. And um now now I'm here at Square.

[00:05:41]>> I love it. So all right. So everybody is dying to know the answer to this question of like what is square thinking like okay why are we doing this? So Square obviously has been very successful right to to to the detriment of most of the people on in this on this event right now. Right. And so why did Square decide hey we want to go after the ISO agent channel. Why is that an attractive channel to Square? Like give us kind of the high level of of Square strategy here.

[00:06:03]>> Yeah really interesting and happy to tell the story. And and full disclosure, when Square started reaching out to me, I was shocked quite frankly.

[00:06:11]>> Yeah.

[00:06:12]>> Um and uh wasn't actually, you know, I was kind of confused why they were reaching out to me at first. Wasn't too keen on it. And then, you know, I learned on my very first call that they wanted to get into the reseller business. And I was shocked. And uh I asked that same question during my you know, lengthy interview process like why? What's going on? Why now?

[00:06:35]The answer in hindsight is actually pretty simple. So Square really owns and dominates that selfserve, self-signon segment of the market. Like I think we can probably all agree there's not really anybody in that even in second place. Like that is Square's segment of the market. Um, and the reality of that business model, like any models, there's some flaws in it.

[00:06:58]But one of the the challenges uh in that model is there's only so many owner operators that are just going to go self-s serve, right? They're just going to go to a website, pick a product, pick a platform, pick hardware, and buy. Um, and then they have to self onboard themselves, self-train the staff, right?

[00:07:17]Like there's only so many owner operators that fit into that category.

[00:07:21]And the other reality is most of the owner operators that fall into that category are probably on the smaller end, right? And so, you know, I got a chance to to ask that same question and the answer uh that was given to me makes a lot of sense because Square really believes in their technology. Like first and foremost, uh Square's technology in my experience being here a year and a half, it's it's pretty spectacular. It's not perfect. No such thing. It's not perfect, but it is pretty amazing. And Square really believes that um that they can not just compete, but win going up market, out market, middle market, even enterprise level customers based on the technology that is built.

[00:08:08]And Square believes that the reseller channel is one of the key engines to help fill that gap and attack and target that middle market customer. And in my opinion, you know, most of the ISOs and resellers out there, that's like a sweet spot of the market for them. They don't want that small teenytiny customer because there's not a lot of money to be made on it. And equally, the enterprise customers are a whole different beast in in and of itself. So that middle tier is typically where most uh ISOs and resellers and agents play well in and that's the segment of the market that Square really feels that they can win in today. Um and that's the that's the why for why now.

[00:08:50]>> Yeah. Yeah. It makes total sense. So my next question is it kind of feeds off that it's a little bit of a loaded question. And so I know Square services like everybody. So there's like a a very broad market coverage, but um there's a little bit of confusion there because you know Square started in kind of again that smaller merchant and now they've developed to your point all this great technology. So I guess my question is when you look at the ISO agent channel, this new reseller program, who are they selling? What are what are these merchants that are kind of this marriage between, you know, merchants that like agents and ISOs are going and talking with and merchants that are a really good fit for Square product? What are you seeing?

[00:09:26]really interesting what what we've found and and that's one of the number one questions like we do a lot of product training and that's one of the number one questions that people are asking is where's a good fit for square like where does square fit the best truth is it's probably easier to answer it in the inverse like where does square not fit quite frankly because I think from the technology that square has it it it works in so many different verticals but even before that like when a new partner first come comes aboard and we launched a pilot with the channel last May uh with 12 partners, two in Canada, the other 10 in the US and in the beginning we were getting very small, teeny tiny uh not great deals and right >> I was taking them with a smile on my face to be fair. Uh, and I would say every month the size and scope of deal that came in kept growing up and out.

[00:10:23]And so today, I mean, even just from a restaurant perspective, which is is is a big bread and butter for Square today as food and beverage. Um, like we see some very very complex deals. You know, we've won a 28 location franchise group. It was a quick service franch franchise group. uh in Toronto and I actually uh got the pleasure to go to this place.

[00:10:47]It's a Michelin star sushi place, million-dollar a month type of place, fine dining, all set up on Square. So, I got to go have a nice meal there when we're live with Square. Uh but, uh drive-thru capabilities are big. Like just from a food and beverage perspective, it can handle a very very wide range of capabilities. But even within the Square ecosystem, there's so many different platforms within the different product sets that can solve real problems for real businesses. So, um, yeah, that's a it's a really really uh interesting like h how it's how it's all played out over the past, you know, especially since call it January, we've seen so many different types of businesses that have came in. But I think now we we've got a lot of confidence with our partners that they can board um not just the teeny tiny small accounts but they can bring right some decentsized accounts and trust that the platform can handle those accounts well.

[00:11:48]>> Sure. So I think what's interesting about that to me is I think one of the other perceptions that maybe it's a misperception you know in the ISO uh agent community is that Square is this very self-serve situation. And so one of the concerns I heard I talked to a lot of agents and ISOs about this leading up to this event just preparing questions and stuff is like well hold on so you want me to sell like kind of like medium maybe larger merchants. Well that's not self-s serve right. What is this sales process look like now that we're asking you know hey I'm going to go in person.

[00:12:15]I'm probably not the biggest expert on Square at this point. So now I got to go in person and sell this medium-sized merchant. Are you doing demos? Like what does the sales process look like? And what is what is the responsibility of the agent ISO versus kind of the Square team at this point? Yeah, part part of the coolest thing that I think we have going on right now is the sign up process for a merchant. How agents can go out and sign up and board a merchant is super cool. I mean, it's it's the the days of the paper application or PDF application uh process or docuign and submitting everything to underwriting and scanning in pictures avoided checks and things like that.

[00:12:56]>> Yeah.

[00:12:56]>> Like that is gone. The unique digital signup process for an ISO for their agents is so incredibly slick and nice.

[00:13:07]Um there, you know, Square is one of the original paybacks, right? So there is no underwriting. You go uh sign up one of your merchants, auto approval. If you had a Square terminal in your car, you could boot that thing up and have it connected and have them processing live on a real terminal in minutes. the sign up process is really really cool. So although you know Square has historically been this self-s served type of process, we've almost repurposed the engine that Square created to now allow agents to use that same super slick, you know, digital very new school process to sign up a merchant and get them live quickly. Um, now don't get me wrong, there's tons of help. Like today we've got 28 folks on my team that all their job is is to support our partners.

[00:13:56]>> That's it. It's not a shared service team. Like they are there to support our partners. So you know from a sales lens, do you need help with pricing or proposals or things like that? Cool. We can help. Do you need, you know, maybe it's a more complex deal and opportunity and you need some help demoing the software? we've got a large group of sales engineers that can step in and help you co-ell and do a you know nice uh uh demo presentation of the product uh to help get the deal across the board. So, you know, although um although we want to be involved and want to help, we don't have to because it can be super quick, super fast for an agent to go sign uh to sign up deals.

[00:14:38]>> Yeah, it's interesting, Mike. I was talking to um I think it was an event I did recently and I was talking about I think a lot of people looked at Square initially and said like well Square is successful because they're just spending all this money on marketing and advertising and all that and that's what's driving it and I yeah I really challenge that assumption of like there's product you know product really really matters like when a merchant is getting something and they're going oh I can open this up and I just know how to use it that has a really big impact right and so I think what you guys are doing is trying to create a product that agents and IOS sell and for them again I they're so used to a lot of legacy products that frankly many of them are terrible and so they're trying to figure out very complicated how do I get the merchant to use this where square has spent the last however many years now figuring out how to get merchants to be able to do self-s serve so hopefully there's a lot more of that there but again I think those agents just they want to know that you have their back I think right you know especially when they first start and they're like well no matter how good the product is they don't understand it now so I think they want to make sure that they're going to be supported and it sounds like you're saying, you have that team in place and you're you're committed to that.

[00:15:40]>> I really I really think so. And James, I'm not here to sell you on uh becoming a Square reseller, but I'm about to right now because the number one reason to become a Square reseller uh isn't the brand. Although the brand is powerful, very recognizable. I think it makes it easier to get into doors, easier to one call close deals. Um it's not the compensation model, although that's strong as well in my opinion. It's the technology. The the square technology is no question the reason to go out and do it. It will help you win more business.

[00:16:17]Period. End of story. And and all the different product lines that exist within the Square ecosystem. You're talking Square Payroll, Square Banking, I mean Afterpay, Cash App. Anyways, the list goes on and on. Uh this is what helps make just an incredibly sticky effect with customers. I know like I've dealt with this for years with agents and sales teams where they would come to me and they would say, "Mike, we can't get this customer to switch. We're saving them, you know, whatever, you know, a few thousand dollars a year and we just can't get them to leave Square, >> right?" And like I always struggled with that and like what the real answer to that is, but it's obvious to me now and it's the technology. Like that's why merchants sign up with Square. That's why they actually stay with Square. In my opinion, there's very few businesses that will actually outgrow Square. They may get drawn away from a good sales pitch from somebody else, but like functionalitywise, I don't think anybody's outgrowing their I don't think their business is going to outgrow the technology that exists today within Square.

[00:17:18]>> Yeah, good stuff. All right, Mike, we're going to circle back around to you in a minute. So, thank you for for jumping on here. If you want to I'm going to get Vlad on here. Um, but yeah, we're going to get you back on here in a minute. So, if you guys have there's like a million questions popping up for those of you asking those questions. Yes, Mike is gonna be back here shortly to answer those questions, but I'm gonna get Vlad Sidowski on here. Vlad, if you want to get your camera and your audio going.

[00:17:39]>> Awesome.

[00:17:40]>> Vlad, great to see you today. Yeah, doing well.

[00:17:42]>> Good to see you.

[00:17:43]>> Yeah. All right. So, Vlad, give us a little bit of insight from your perspective. Number one, what do you think about this? I mean, you've been in the ISO space a long time. You've seen it. What do you think about this reseller program? Mike is listening intently. Uh, and then, uh, what are you doing inside of the Square ecosystem with Nativia? Well, listen, I I actually love it. Um, I think that uh Square tried to do this a few times, right? And every fintech is trying to do this a few times, but if you don't bring the right team, uh, just like with any business, the program is going to fail and they failed a number of times. And I think you know why now one of the questions that was discussed ear earlier is that is because Square did learn from their mistakes or the management team there and they did hire Mike and they did allow Mike to give uh himself an opportunity to succeed by hiring the right support team around it and uh give enough feedback to to the um to the corporate as to what needs to be done and how it needs to be built and uh really have ISO business in mind. We we have a unique business and unique industry. Finaxs fail if they're not guided, right? And this is the first fintech guided tour, if you will. And I think um it's it's uh it's incredible what my team has been able to do in the last 6 months. And uh when I initially heard of it um um just like everybody else, I was uh taken back a little bit at one point. But on the other side of it is that if you can't beat them, join them kind of a thing. Um and and uh you know, Nativia today is a multi-product company. We're not just an ISO. We never try to be just an ISO. And uh we have an angle in this game and um uh it's a pretty pretty cool angle that I believe that makes sense. Uh and after speaking with Mike and some some team members at u at square, we felt that uh it would not be of any kind of conflict of interest and in fact it will enhance the mutual company's offering and u you know our new slogan that we started doing this year especially with our conference called combined to win. This is one of those really combined to- win moments where we feel that we have something that we'll be able to attribute to this uh to to this to this product set. Um and uh we want to be on the forefront of an innovative program. I've always been there. I've been there with Nivia Banking for a number of years to this point and um I I think that Square is innovative program and therefore you know it's it's a place for Nivia Banking to be there to be supportive of that of that program for sure.

[00:20:34]>> Sure. Awesome. All right. So Vlad give us quickly just high level what are you doing with Square? So I know again we're everybody's asking a million questions here. We're going to get to order out in a minute and and spoiler alert that's where the reseller program is at. So you guys are all asking like what are you trying to accomplish? We're trying to get you to sell square, but you're going to do it through order out. So Vlad with Nativia, what are you doing with Nativia? Talk about how you're, you know, what you have is enhancing the product offering for the agents and ISOs, >> right? So So you know, you might think of the fact that um you know what is what is what is Nivia doing? We're we're already a processor, right? We we we process thousands of apps a month, billions of dollars in processing. Why do we need to why all of a sudden we're doing anything with Square to begin with? is considered to be competition.

[00:21:20]Well, first of all, it's never a competition. In our business, as you know, it's co-etition, right? And uh it there's there's number of examples. I'm not even going to tell you how many examples are out there. I'm sure everybody can answer that question.

[00:21:33]But I think that um in our case, we're really um highlighting the fact that uh Nativa is no longer about payment processing alone. It's also about banking. And what a better place to be uh is partnering up with one of the best POS systems in the country to be able to enable Nivia banking instant funding option. And yes, Nativia banking is officially enabling instant funding option for Square merchants. And so for the ISO community, we're already the leading company. And in some cases, some ISOs still question whether they do Square banking or some other banking.

[00:22:12]and they and they never they never have a straight up answer for us. Nivia banking is a horizontal platform. We work for you know valor terminals, deja vu terminals and now square terminals where we enable instant funding. So with one one sign up we know that ISOs sell variety of products and no matter how much we could say that we we we want to sell all the squares or want to sell all the clovers or all the other devices out there that's never the case right that's the that's the difference of the of the U ISO channel as a whole versus any other uh channel including the fintex and that channel requires a horizontal product Because our sales channel, the way that I know it and the way that you know it, James, is the channel wants one one company for one product so that they don't have to think about it. And the only time they would think about some other options is the POSOS uh for different verticals because an average salesman does come through five, six, seven different verticals. Well, one thing that combines all of these verticals is banking products. I don't think they've given themselves enough of a chance to understand what that is. And we provide one universal solution and with the partnership where we are uh through technological partnership with auto app through the blessing from uh Mike's team and square team um enabling instant funding for square merchants on the nivia banking platform is a huge deal. Of course, we are having no problems, you know, enabling resellers through the um spoiler alert that you just mentioned, the auto route platform.

[00:23:57]So, Nativia ISOs will participate um and have already been some some of them already signed up and participated in the Square program um on the on the early on the early beta services and uh I think that we can keep the bar even higher with the with the program uh for the um ISO community that is unlike anything else. And while other big processors looking at saying, well, we're going to sign up for Square, but we're going to try to figure it out how we're going to manage it. Niva has a unique lever, and that lever is called banking. And we have many more products coming out with banking. And we do want to have all of the deposits that Square loan program will do to end up on a on a on a on a square on the TV banking rails and increase the depository and the and the validity of all the merchants. We want all of the Afterpay accounts to go into the into the TV banking services and um um we try to adhere to the high standards that Square and their technology provides. And I think this is where the unique angle for the ISO. It's uh really not a decision what type of banking services which I believe and I've been saying this for a number of years a cornerstone to the ISO community going forward because it should be across every board that you can come into a merchant and demand a bank account. uh and that's where our angle is and we're planning to have uh more credit products uh charge card products uh credit card products that are coming out from Nativia banking. So uh that's the angle that Nivia will be playing with it and along with uh officially endorsing every reseller of Nativia to be um a part of the square ecosystem.

[00:25:49]>> Cool. Love it. Thank you Vlad.

[00:25:50]Appreciate it. Um yeah, so again I think at the end of the day selling Square accounts is should be pretty easy. Um, and then it's like, okay, well, how do we maximize residual income? And so, this is one of those ways. So, um, what I want to do now is I want to, and again, Vlad's gonna back on as well. If you guys have questions about that, you're asking those, uh, those will be answered in a second. Um, so, Tibo, I want to get you on here. Um, so if you want to go ahead Yeah. And and jump in.

[00:26:12]So, um, you know, we're just going to cut right to the chase, Tibo, because we have like, you know, literally a million questions here of the agents trying to understand this. So, um I think at this point everybody's pretty clear on the economics of like where Square Reseller kind of started at. So, I'm going to ask you all the big questions that people have. So, number one, the Square reseller program as of right now is is closed to go direct to Square. Um and so, Tibo, talk about order out and what you're offering to the agents and ISOs and why they should consider uh you know, working with you.

[00:26:43]>> Got it. Okay. Um so thank you James to to have us. Um we started order out a long time ago like more than 5 years ago with online ordering and delivery with Yuber Door Dash uh Grabber all these delivery platforms and um recently we have been able to open accounts directly for these platforms and when we also discovered that we could do that also with Square and also with Netavia for the banking services uh we started to be like okay let's combine everything together and that's how the order how reseller program started. Um so the we just started with with Square started like you know a few weeks ago. Um so we we we we allow to have anyone an an access to have access to a portal um where any anyone can resell square in more than 10 different countries. Uh we we support different pricing and um the merchants can also subscribe to other product from uh you know instant funding uh to uh opening Uberit accounts without requiring any phone calls just you know in a few clicks and then after with order out connecting all of that uh we also allow for example restaurants to have their menu getting created with AI and everything you know being streamlined that's overall you know how how things are starting.

[00:28:09]>> Yeah. And so I think to clarify for those agents that are on here now that are like what role does order out play in this. So they're looking at it and saying number one I want to be able to sell Square and right now they can't, you know, there's only the only way they could do that right now is become a sub agent under somebody else that already is a reseller and usually that means taking a lower residual split, right? Um and then you know the other thing is you mentioned the portal. So let's start with portal then we're going to go compensation. Um, and then again guys, we'll open up with Q&A and we'll put Mike on the hot seat again to answer all these tough questions that are coming in about Square, which is going to be fun.

[00:28:42]So, TBO, let's start with a portal. So, explain that for a minute. What does that mean? So, you now have a portal that ISOs and agents are able to access to see things like residuals or etc., etc., right? Can you explain that a little bit?

[00:28:54]>> Yeah, exactly. So, a reseller is an organization. An organization has as many ISO, subo agents, sub agents.

[00:29:02]Everything is fully white label from a domain to icon to colors anything. You don't see order out as your merchant won't see order out. Um and um as the the ISO or the agent, you can see the different application that got submitted. Um and uh and you can also select the different services, you know, the add-ons uh that you want to offer.

[00:29:26]Um then when an account is approved um by by Square um you can see uh the payouts and the transactions that go there. This is where instant funding you know connects extremely well because you you have the the agent organiz that can directly see you know how much money uh the business made last week or last month and now is using the instant funding. Um and um and you can also uh connect all the other delivery services from online ordering to uber dash and and grab. Um they will also see the residual uh that uh get paid uh monthly from square to order out and then order out distributes that the reseller account the master account and and then the the ISO redistribute his residual the way he's he has always been doing it.

[00:30:18]>> Cool. So that leads into residual. So the other reason I have not done this event uh for yet uh was because the only people that were coming to me to do the event were saying we want to take squares program and then we're going to give the people on your event a small portion of that and then they're going to give people a portion of that. So when uh Tibo when you came to me with what you guys are planning because again you you have the you know Nativia has Nativia banking which is their their economic driver. You have order out which is your economic driver. Um so talk about the actual compensation. So what do the agents or ISOs that are working directly with you what are they able to get from uh from this relationship economically?

[00:30:56]>> So that's very simple. We they get everything we get from uh from Square today. So um literally the the the the residual that we get from Square every dollar goes uh to the to the to the ISO.

[00:31:11]We make money on the other services that we have but it's like you get 100% of what Square give us. It's like it's almost direct but order out is in >> right. Yeah. Love it. And so and this is this is the key component and when when I found out about this I was like okay we'll do an event. So yeah so the idea here is for if and correct me if I'm saying this wrong TBO. So, the two two big headline things here is the agent or ISO that wants to resell Square, the Square reseller program direct has been has been closed for for right now. They can come to order out. They can sell all of the same merchants they would have sold. They can sell Square in any way that they want that Mike was just talking about. And what you're doing is taking the full amount that that Square is paying, which we'll put Mike back on the hot seat for that in a minute. Talk about the comp. Um, 100% of that is going to come to of course to Order Out.

[00:32:00]order out and gonna pay that out to them. And also, they're gaining more of a traditional ISO portal. So, if they want to bring on sub agents or referral partners or whatever, they can now have this kind of substructure underneath of them to take every dollar that comes in from Square and pay out. And then you guys are making money on the on the add-ons with order out and then of course Nativ on the instant funding, the banking and that that side. Did I did I say that right?

[00:32:22]>> Yeah. And we are starting >> we are starting with the small amount of of products but we are you know planning to add a lot more on these other products also the ISOs or the resellers you know anyone uh potentially could also make more money based on the financial model of the of the other services. So that's coming soon. Um >> yeah very very straightforward you know.

[00:32:47]>> Love it. No that that that's awesome. So okay so I promise we're going to get to Q&A. I want two more minutes. So, I want to get Brian on here. So, Brian Rodriguez, if you can get your camera and uh audio on. So, Brian, real quick, uh so Brian works with Order Out. Can you just give us a real quick intro of what your role is at Order Out? And then also share with the agents who right now are like, "Okay, this sounds great.

[00:33:09]We're going to do Q&A, but where do I go to learn more about this and to actually sign up as a reseller?" So, maybe you can introduce yourself and give us that kind of call to action there, Brian, and then we'll we'll do Q&A.

[00:33:20]>> Yeah. Hey, everyone. I'm Brian. I run uh most of the operations here at Order Out uh very closely with Tibo and the team.

[00:33:27]Um uh so yeah, like like I was saying, uh we will be at the conference next week for MWAA.

[00:33:33]Okay. Uh sorry, this week in Chicago, actually, this week, not next week. Um and the and John will also be there.

[00:33:40]John's uh in charge of the reseller program. Uh me, I handle more on the operation side, but I am a little bit uh still involved there. So John can sign you guys uh up u um instantly um by email or if you or if you meet us there at our booth. Uh any questions you guys have, we can answer it there. Um we can show you a demo of the ISO portal as well. We built our ISO portal where you can see all the residuals and everything and all the agents hierarchy laid out there. So yeah, I mean that you know everything is is pretty straightforward and um we have a portal for that for you guys to look at and everything is plugandplay there.

[00:34:16]>> Awesome. And so, and then also I did set up a uh a URL that uh for you guys. So, the the URL most of you use to register for this event is ccalespro.comsqu.

[00:34:26]Um if you now visit that URL again, I'll put it in the chat for you, but cc salespro.com/square.

[00:34:32]If you go there now, it will actually take you to orderouts um page where you can go and you can get signed up as a reseller and of course uh Brian and his team will be following up with you. So, um we'll put that link up again in the chat here in a minute. All right, Mike, it's back to you. We're going to put you on the hot seat. We got a lot of questions. I'm I'm going to do my best to summarize everybody's questions and to to put you on the hot seat. So, let's start at the at the top here. Uh Mike, so in our industry, everybody's used to like Tesus, Ferve, Elevon, etc. And this understanding of residual income, you know, that it's lifetime vested, that it's not stolen in the event of a merger or acquisition or whatever, right? So, talk about Square's commitment to residual. Um and and in this case it would be the the residual going to order out and then of course order out will be paying that out. So um talk about that and then also if you could kind of explain the economic model because since Tibo said they're going to be passing 100% through um then you could maybe share more of the specifics of like residual split kind of how that works relative to like legacy models that agents and ISOs might be more accustomed to.

[00:35:31]>> Sure. Uh so the agreement that uh Vlad and Tibo have signed with with Square is a lifetime residual uh agreement. So that should I think we can probably keep it as simple as that for that one >> but everybody's uh fear to rest on that one. Um, in terms of the economic model, uh, which I'm actually like surprised you guys want me to talk about this rather than you walk wanting to talk about, but hey, here we go in the vein of transparency. Um, so 70% is the residual split. The big difference is everybody in our business is is used to the standard schedule A that has all these like million line items on them.

[00:36:21]You've got x amount of basis points and x amount of per transaction fees that your buy rate is. You've got a batch fee. You've got a statement fee. You've got a regulatory fee. You've got a PCI fee. You've got an annual fee. Like these things simply don't exist within the Square world, thus not existing um for uh our ISO partners as well. So the schedule A is is very beautiful and spectacular. So very simple comp plan.

[00:36:49]>> Yep. Yeah. And so and again I think um you know there's so many interesting things to unpack there because of the account on file fee and things like that that that do add up also things like you know gateway fees that come in people are trying to integrate with other solutions. So basically none of that is there. So I'm going to restate this and Mike correct me if I get it wrong. So what you're saying is what Square is paying to order out and again Tibo just said 100% is being you know paid out which is why we wanted you to talk about the compensation because it's like you know there's everybody will know when they look at the numbers this is it right. So, you're saying that Square is going to calculate, you know, margin based on just interchangeing card brand fees. That's it. So, you have interchanging card brand fees.

[00:37:26]Everything else is margin. Um, that margin, 70% of that margin is going to be paid out and 30% is going to be kept by Square.

[00:37:35]>> Correct.

[00:37:35]>> Okay.

[00:37:36]>> And and I see some questions here. Uh, James, >> people are asking uh about the 100% that that Kuba just announced. So, it's 100% of whatever Square is paying. So in this particular case, uh it's good that we have Mike here to clear up the conversation because I've already seen those scenarios before. Uh people asked me the same way. Uh even when we did some of the banking deals and some initial customers that uh we had some of our ISOs went to the order out, they were asking me as well. Um is that uh basically it's it's a complete pass through. there's no markup of any kind uh for the current square commission schedule which you know Mike just just announced and the the same reason that u we just explained is that we have um levers that 90% of the customers out there in ISOs do not possess. Nativa has its Navia banking. We are strictly after our opportunity to partner up with Square, one of the best PO systems in the country and worldwide and be able to have the banking services uh for those Square merchants. And uh on the TBO side, it's it's a very similar situation. It's basically uh order out has the Door Dash and an Uber Eats engine. For us, it's actually really good as well because uh it's a product that everybody wants and being able to have one point of contact and open up an account with Uber and Door Dash without calling Door Dash and do individually and do it programmatically in a blink of an eye in in a very technological fashion right at the get-go is is a big deal. And more importantly the the the some of the opportunities lies in the fact that the merchants are actually getting a week later deposits from Uber and with the TV banking they get it they get it immediately and u um that is a big deal. So that's kind of that's kind of how the the the structure works.

[00:39:43]>> Got it. So yeah. So again just clarify for everybody and I'm just restating what everybody's saying here. So um Square is paying a 70% split over zero.

[00:39:50]So 70% over interchange of card brand fees as a cost. That money is being paid to order out. Uh the opportunity here that's being presented is you as an agent or ISO. You have an opportunity to contract with order out uh to become an ISO an agent of them and they are saying that they're going to pass 100% of what Square is paying them. They're going to pass that through to you which means you're going to get a 70% residual split on these deals. Order out's making money on the uh order out side. Niv is making money on the banking. So all right. So the next question Mike goes back to you here. is pricing. So, everybody's like, "Okay, cool. I get 70%." Of what, right?

[00:40:23]So, what's what does the margin look like? So, a lot of these agents are used to selling really two programs. Um, one is interchange plus pricing and the other one is like dual pricing, um, you know, cash discounting where, you know, they're it's 399, you know, fee on the, you know, 399 differential. Um, and so they're trying to kind of make heads or tails of like how much flexibility, if any, exists here and and what does that look like? So, help us understand kind of the pricing component, Mike. There's definitely flexibility [clears throat] that that comes with pricing out a deal.

[00:40:53]So, I saw a bunch of questions. Can you do interchange plus pricing? Yes. Uh, you know, you could even do some kind of blended tiered mix to, you know, compete with Toast if you need to. Um, can Square do cash discounting, dual pricing, search charging? I'll be very uh clear with my response on these ones because this seems to be like everybody's most important question.

[00:41:19]>> Um no to dual pricing. So Square does not offer dual pricing as it sits today.

[00:41:25]>> Yes on cash discounting specifically meaning and I'm going to use a restaurant as an example. The printed menu needs to reflect the credit card price. Then that menu pricing that's programmed into the point of sale will also reflect the credit price. And then you know you can have the note at the bottom of the receipt that says we offer a 4% discount to anybody who pays cash.

[00:41:48]Then with a cash uh tender a 4% discount can be applied. Then uh lastly is sircharging. So square does a bin compliant searchcharging specifically meaning it will recognize the debit card. it will not sirch charge the debit card and the merchant will be charged a normal fee for uh the debit card transaction. So um quite a bit of flexibility there. I can tell you like this is a topic I want to dive into a little bit and I don't want to take up all our time but it's a really really >> it's the one everybody cares most about.

[00:42:21]So go ahead Mike.

[00:42:22]>> Yeah. Yeah. So, like to me, there's a there's a there's a switch that has to happen in an agent's brain in order for them to effectively go out and sell Square. And that switch is you don't have to go out and sell on price. Look, I've done it. We've all done it. Hey, we can save you some money on your credit card processing. That the days of that with Square uh in your arsenal are gone because you don't have to go out and sell on price. You can go out and sell on the technology that's spectacular.

[00:42:55]You can go out and sell on you. That's spectacular. You can go out and sell on the local service and support and white glove this that and the other, right?

[00:43:03]And then pricing is an afterthought.

[00:43:07]I've actually spoken with some very successful agents from some of our top offices. These agents, like my eyes, doing 20 deals a month as an agent, it's pretty damn good. And I' I've got a chance to to speak with some of these guys and I'm like, "What? Why? How?"

[00:43:23]Like, "I want to know. Teach me what you're doing." And the feedback from them is exactly the same across the handful of agents that I've talked to.

[00:43:33]They're like, "Look, you know, it's easier for us to get into the door. We go out and, you know, and sell on the technology and the ecosystem that is Square." Um, and pricing is an afterthought. Oftentimes, we're not even talking about pricing. And if we do, right, well, this is what you pay with Square, right? The pricing is very visible and transparent on the website.

[00:43:53]This is what you pay. This is what everybody pays. It's super simple. Boom.

[00:43:56]And they continue to go. In fact, um we did over 1500 deals through the channel uh last month. Um and uh just over 60% of them were done at the rack rate.

[00:44:11]>> And so it's really [clears throat] really interesting. single digits were done on interchange plus pricing.

[00:44:17]>> So I think it takes a second for, you know, to unwind this thing that we've all done for so many years and this process we've went through for so many years. But the simple reality is you don't have to go out there and negotiate your way down to zero just to get an account. You don't have to do it.

[00:44:35]>> Well, and I think I think Mike, to be fair, I think I think the agents care more about margin than savings in this conversation. So in other words, like Yeah. the interchange plus is is kind of gone, you know, by the wayside a bit.

[00:44:47]The problem with searchcharging now is because uh Visa capped it, you know, at 3%. It's like, well, you know, there's not as much margin there. It's still, you know, a little bit better, but it's not great. Um, and so kind of that cash discount dual pricing has become a big conversation around, hey, it's a best of both worlds. We can pitch, you know, free processing or or net free, but, you know, and and still generate a lot of margin. So, going back to the cash discount for a second. So, if somebody does that, right, how does that how does that work from a billing perspective?

[00:45:15]So, one of the other important things that agents care about is they go in and set somebody up and they're like, "Well, I'm currently paying, you know, 2.7%."

[00:45:21]And they're like, "Well, I'm going to do cash discounting at, you know, 399 4%."

[00:45:26]But there's a daily discount. So, at the end of the month, it's like they get their statement and they're like, "Oh, I didn't owe any money because it was already all collected throughout the month." So, there's kind of those optics. It's like a little bit of a, you know, uh, smoke and mirrors depending on how you look at it. How does Square handle that? Because I think that's what a lot of the agents want to understand is like, can I still get my margin and sell these people at 4% and do this? You know, >> the answer is yes. Everything that you just described is exactly how we have it set up today.

[00:45:50]>> Okay. All right. That's awesome. Okay.

[00:45:52]All right. So, um, let's get into some of these other questions here. So, again, I want to circle back to merchant types. So, Mike, let's get a little more specific. Give me the top three or four merchant types that you're seeing ISIS and agents that are selling. guy. I know you service hundreds, but the agents need to visualize this a little bit.

[00:46:09]Like, who are they? They they're going to go out in the field tomorrow and sell Square. Who are they targeting? What's their best chance at getting a sale right now?

[00:46:15]>> Well, if you're going to twist my arm on this, I'm going to I'm going to be a little bit uh uh generic, a little bit vague, but it's restaurant, retail, and service-based businesses.

[00:46:26]Those are no question the big three that we're seeing the largest percentage of deals come in. Now, there's plenty of like subcategories and individual MCC's under that, but I think those are those are the big three that we're seeing a ton of success in.

[00:46:43]>> Sure. Okay. Two other big questions here. One, uh, Tibo is going to be for you. And that is, um, so the agents are going like, "Okay, cool. Square is committed to lifetime residuals to you, but you're the one paying them. So, can you confirm kind of this contract with the agents and ISOs? Is this a typical kind of lifetime vest that hey you're you you own these residuals or you know can you just kind of clarify a little bit of like this agreement between you and the agent because that's what they care more about since you're the one paying them.

[00:47:08]>> Yeah. Uh we literally everything we have with Square we pass it back to the to the to the agent. So they have until we get residual they have the residual. Um the contract is between is order out and square but the reseller has a contract with order out. So they you know own the merchant also if they want to think this way it's we we are really like passing through and >> sure >> obviously order is specialized in restaurants and delivery companies but that obviously work for any other business um if you don't want to have a Uberit account because it doesn't make sense there is no problem we don't care we're happy uh it's for anything with add-ons based on the business category >> got it yeah so so and the the residuals are life fest. And it's funny too cuz like I think Mike our whole industry is like everybody's gotten so comfortable with like Tesus and Fiserve and these others that it's like it's like yeah they're they are also passing you know you're not getting your residual directly from like the card brands here everybody like you are getting your residual from a company uh and so from a large company that is controlling it and so yeah so square is going to pass residuals down and then again you guys can work with order out look at terms of service but again we're talking about lifetime vested residuals there. I can [snorts and clears throat] tell you I can tell you that um you know we've turned on a few of the Nivia resellers that wanted to sell square because they found out about this promo obviously a little bit ahead of ahead of uh the today's event and so uh what we made for the ISO community is is is very easy uh we just basically took the agreement that we signed up with square both Nivia and order out signed with square in terms of uh in terms of um the ISO program uh um and Nivia to the degree of Nivia banking order out to the the degree of everything else. Um we we basically um uh took all of the comments that has to do with residuals guarantees and autoout has it in their agreement 100% exactly the same way. So all the lifetime residual guarantees, there's no games, there's no tricks. Um, it's it's really a true combination of technology, partnerships, and having one of the best uh one of the best scenarios in the market.

[00:49:28]>> Cool. All right, Mike, back to you with another question. So, I think I know the answer to this, but a lot of people are asking existing Square merchants. So, they're out in the field, somebody's already using Square. I would assume that's off limits to this program. Is that correct?

[00:49:40]>> Off limits. This is a uh this is a net new business program for sure, >> right? Yeah. Square's already making 100% on that business. they don't want to go down to 30. So, we'll we'll uh Yeah. Uh not to mention Square already made the investment to get that account in marketing dollars. So, there's a cost of acquisition component. So, yeah. So, I figured that um all right, I'm going to go through here and ask some of the more kind of random stuff now. Um so, uh oh, uh crypto you know, everybody knows Square recently kind of enabled merchants to accept Bitcoin and things like that. Is that something that's part of this program? And if so, is there like a revenue component and and you know to to you know making residual on crypto acceptance that kind of stuff?

[00:50:18]>> Not yet. Uh from a revenue perspective on cryp on crypto specifically Bitcoin is is is the offering uh the crypto offering that works through Square. So not yet. It's there. It's available. Um but uh nothing from a revenue share perspective today.

[00:50:36]>> Got it. Okay. Um what about um look at this other one real quick here. Um so can you kind of talk just I'm trying to answer a lot of these questions at once here just more broadly. So what do they make money on? So yeah payment processing we got. What else? So we know Nativia banking we know order out. Is there anything else with Square as far as additional services fees like what is there anything else they make money on?

[00:51:00]>> Payments.

[00:51:01]>> Just payments. Got it. All right. So that that was that was an easy answer.

[00:51:04]All right. So you're making money on payments. Square is getting 30% and they're going to keep if there's additional SAS revenue from upsells which is pretty uh similar to kind of like a Clover type situation. So, um what about when you say restaurant? So, you mentioned this kind of like um sushi place. Uh so, Square now, how would you how would you categorize Square? I know you probably don't want to talk specifically about competitors, but obviously Toast is kind of this big topic here everybody's asking about. So, when you know somebody's going in and they're like, "Well, I'm considering Toast, right? Is Square going to be head-to-head in that in that comparison for a fine dining or quick serve restaurant or where is Square at today?

[00:51:40]>> I would say for the most part yes, right? Like I'm sure there you could go down a list of features and functionality and nitpick probably on both sides quite frankly, right? Um, but I would say for the most part it's going to be a an absolute head-to-head comparison. And I can tell you we're winning a substantial amount of food and beverage business today.

[00:52:06]>> Sure. Okay. Um, another question here is hardware. So, um, you know, I'll go to you and then Vlad, you may want to add something to this. I know you and I were brainstorming about this the other day.

[00:52:16]So, um, Mike, where do agents get hardware? How much does it cost? talk about hardware a little bit because this is I think a little bit this is actually something that is a bit different than than what what is typically done in our industry. So >> yeah, totally. I mean hardware pricing is right on the Square website. So I would encourage you all to go to the Square website, click hardware and you're going to see everything that is available. And so you know I'd say a lot of our resellers are buying all of the hardware from us. Some are buying some of it from us. Um all the square stuff you need to get from us, right? like the Square register, the Square Terminal, the Square stand, the Square handheld, like these Square products that we build in house. Um, I don't think this is a a play to go mark up hardware and make a bunch of money on hardware. Quite frankly, I I don't I don't see that as um a motion that anybody's out really doing successfully today. Um, so hardware pricing uh is the hardware pricing you'll see on the website.

[00:53:11]>> Okay. Um, and again, I'm going to put this uh in the chat again here. Uh, so again, it's cc salespro.com/square.

[00:53:18]Several people were asking about that.

[00:53:20]Um, that will now redirect you over to order out to take a look at the reseller program there. Vlad, anything that you wanted to add on the on the hardware side or kind of thoughts or anything about about that?

[00:53:31]>> Yeah. So, so, so basically there's there is you know uh Square uh enrolled programs that are related to the hardware business in terms of uh uh payment over time. Uh Nivia banking will provide hardware services to square utilizing Nivia banking. So if you are uh as an ISO sign up as an ATF banking customer, you get a special discount for Square accounts uh and for Square hardware and uh that would be 3% cash back on any Square hardware if you sign up through uh and you and you're using Nivia card on a go forward basis. Um, so if you're an ISO, you have a Nativa bank account with us and you use uh the money proceeds from Net Bank account to buy Square hardware, you will get an automatic 3% cash back.

[00:54:19]>> Got it. Couple of the questions I think I can answer. Again, somebody correct me if I got it wrong. Um, but no, so you don't make any money on hardware or or SAS fees. So that's not that's not the profit center. It's it's the payments.

[00:54:29]Um, and then also there's no upfront bonus being offered here. This is a straight up 70% split. I think we're I think we're pretty clear on that. Um Mike, I want to there's like, you know, a million other questions that I'll send over. By the way, if you ask a question, I didn't get to it. I apologize. There's like a lot of questions in here. Um I'm going to send it over to Tibo and his team and Brian, and they'll uh they'll do their best to kind of follow up, uh you know, with you all there. Um Mike, I want to close this out with with you.

[00:54:54]And the question I have for you is I'm, you know, I'm let's say let's say I'm an agent. I've been in the industry for 10 years. I've been selling, you know, 10 accounts a month. I've been competing against Square this whole time. You know, why should I do this?

[00:55:07]Like, what's what's your pitch to the agent? And and then my follow-up question to that is if I'm like, "Okay, yeah, that makes sense, Mike. I'm going to do it, right? What am I going to have to change? You already alluded to selling on value, but what are the other tips that you've seen from successful agents and ISOs? Like, what do I need to do to like make this shift and turn this corner and and kind of, you know, move forward with this successfully?" You know, num number one thing is I genuinely believe that this will make selling square will make any office, any agent more successful fairly quickly.

[00:55:44]This is something I believed before I, you know, accepted the position with Square. This is something I believed during the pilot, but now we have real data to back this up. we have real humans that outside of just Mike here like that that would attest to that exact sentiment. So for the person in that example that's been selling payments for 10 years, um there's probably many deals that you lost due to lack of technology over the years. I know it's happened to me, right? This will help you compete in a environment that I think more and more so these days requires some kind of piece of software to go along with the payments. Um uh you know selling a terminal only maybe a different story right but if you can bring some level of software to the table alongside the payments then I believe you will go out and win more deals and win more business. Um, I believe the brand recognition alone will help you get more at bats as well.

[00:56:47]>> Yeah.

[00:56:48]>> What do you need to change? Well, definitely your mentality around pricing for sure. Um, that is that is absolutely something that you would have to change coming in here. Um, and uh, you've got to you've got to understand like what's what's going to happen post sale. Some people are really good at this and some people aren't quite frankly. And just because you've been doing it 10 years doesn't mean you have a strong healthy portfolio and you're great at service and support, but to me that's what everybody should be thinking about. It's one thing to go acquire a customer. It's another one to keep them right. And sure, technology is a piece of that puzzle that will do it. But I think how call it what it is, how everyone's been competing against Square for years is bashing the service and support, right?

[00:57:33]Well, now you're an extension of that service and support. if you are an agent out selling Square. So, you need to, you know, you need to take pride in and ownership in that, you know, post sale component of it. Uh, especially when it comes to a point of sale terminal. You need to be there. You need to be involved. You need to help take that customer live. That's something that's really, really important to me when I'm out talking to offices is like, what does their infrastructure look like post sale? And uh to me that's a a value that the order out team has and brings to the table that can help you. So >> well I'm glad you brought that up. That was actually probably the biggest unanswered question was still how does this work from a support perspective.

[00:58:16]Who's providing that support? And so I think what I hear you saying is Square support model is remaining unchanged.

[00:58:20]They you know you go online and you you know the product is good and so the idea is that it just kind of works. Um, but you're saying that for the agents and ISOs that want to provide that next level support, that's going to be primarily on them to go out and have that ownership and and provide that support to that merchant, >> right?

[00:58:36]>> Yeah. Yeah. Good stuff. All right, everybody. I thank you all so much. We have a ton of people still on here. We had uh, you know, I think over 550, I think, at one point that were joining here live. And so, I just really appreciate all of you. I know you're all super busy. Again, if you want to learn more about this program, head over to ccalespro.comsquar.

[00:58:54]um cc salespro.com/square and that will take you to order out and again the orderout team I'm sure we'll be following up with you as well. Uh Mike, first of all, thank you so much for taking time to jump on here and answer all these questions and share your insights with us. We really appreciate it.

[00:59:06]>> Yeah, thanks for having me. It was fun.

[00:59:08]>> Awesome. And Vlad, Tibo, Brian, thank you all very much for jumping on as well. Uh really appreciate that. Thank everybody for your time. We're going to end it here. And again, if you have a bunch of questions I didn't answer, uh those are going to be hopefully followed up on by Tibo and his team shortly. So, thanks everybody. Have a great day.

[00:59:23]And yes.