Exposing the Power Play between Integrated Software Vendors and Payments Processors for Ownership of the End-user Relationship
Valuations for ISV platforms with payments integration, and payments processing companies which have vertically integrated high margin, high growth software platforms with measurable EBITDA contribution, are on the rise. The level of M&A activity for both is striking. But beneath this synergistic rapture and its intoxicating boon to valuations lies a fascinating phenomenon which bespeaks a calculating power play between ISVs and payments processors for the keystone to their shared windfall: the end-user relationship.
Submitted by Lane Gordon, April 12, 2016
Growth in global e-commerce has had tremendous ramifications for online retailers (e-tailers), payments companies, and the broader software industry. As consumers worldwide continue their rapid adoption of online payments, the lines between e-commerce and payments companies are getting blurred as the two verticals converge. Payments companies are increasingly seen as acquisition targets for enterprising e-tailers, ERP, and SaaS companies, in addition to traditional payments businesses.