jelca thinks

Horizontal vs Vertical Payments

jelca thinks

Horizontal = industry agnostic

  • broad service covering a wide breadth of industries

  • usually more mature solutions

  • examples: Square, Worldpay, Quickbooks, FIS

Key:

  • need to own the entire stack and have an incredibly powerful value proposition or else you will lose to incumbents

Vertical = industry specific

  • full featured solutions for industry niches addressing specific pain points

  • functional specificity narrows their target market but creates high stickiness and higher ARPU if they can serve their market well

  • examples: Lightspeed for restaurants, Mindbody for salons/fitness

Key:

  • need to REALLY UNDERSTAND industry pain points and be able to solve for them

Overall

  • merchant services and card acceptance are table stakes

  • payments should be part of a bigger software solution

  • horizontal or vertical, they are a one to many opportunity for acquirers

  • consider operational costs and acquisition costs no matter what path you choose

Collect this post as an NFT.

jelca thinks

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Horizontal vs Vertical Payments