Firespring’s PaymentSpring acquired by Nelnet
PaymentSpring, a payment processing gateway developed by Lincoln’s Firespring, was recently acquired by another familiar name in the community, Nelnet. The first step in closing the deal was a cold call. “It started with a sales call,” said Mike Phelan, President of PaymentSpring. “We saw an opportunity from the Nelnet Transaction Solutions (pre-name change) perspective…
PaymentSpring, a payment processing gateway developed by Lincoln’s Firespring, was recently acquired by another familiar name in the community, Nelnet. The first step in closing the deal was a cold call.
“It started with a sales call,” said Mike Phelan, President of PaymentSpring. “We saw an opportunity from the Nelnet Transaction Solutions (pre-name change) perspective to acquire a new customer.”
The deal started to come together during a lunch meeting between Phelan and Jay Wilkinson, CEO of Firespring. They began to connect the dots: similar vision, similar culture, similar ethics.
“The initial discussion was about a partnership to leverage the client base of each of these institutions doing really cool things,” Wilkinson said. “There were so many large-scale opportunities to leverage the relationship that it made total sense to deepen it.”
Firespring brings an extensive market in the non-profit sector to the table, with clients in all 50 states, 11 countries and six continents.
“Our non-profit business is growing the fastest,” Wilkinson said. “For us to be able to broaden the technology and make it easier for our non-profit clients is a really critical factor for our growth.”
The former Nelnet Transaction Solutions has history and experience in software development, along with a strategic alignment with Firespring.
“We were a software company with that sensitivity, how to program and move forward with tech,” Phelan said. “We saw the specific road map that Firespring wanted to roll out, and it fit hand in glove with the way we wanted to go as well.”
The PaymentSpring difference
Phelan and Wilkinson were asked what differentiates PaymentSpring from other payment processing alternatives.
“A client may sign up for Square to do mobile, sign up with Heartland Payment Systems for recurring payments,” Wilkinson said. “They could end up with five different merchant processors and five different interfaces.”
PaymentSpring offers an all-in-one payment solution to manage all these different modalities in one place.
“No one else is doing what we’re doing, simplifying the interface for the user,” Wilkinson said. “If I’m the Executive Director of a non-profit, I can log into the PaymentSpring dashboard and see all the different kinds of payments.”
Phelan said that competitors offer partial solutions but not the whole package available from PaymentSpring.
“What we’re really doing is focusing all that data into one dashboard,” he said. “We pick up where others are leaving off.”
Customer service is another area where Phelan and Wilkinson see a distinct competitive advantage.
“The guts comes from our Midwest work ethic, a commitment to customer service,” Phelan said. “It sounds kinda corny but lots of our competitors do not have customer service.”
PaymentSpring offers self-service implementation through an API that client developers can integrate with their company or organization system.
“Whether it’s a startup or someone else looking for a new payment processor, they can go in and start the implementation right away and be up and running in no time,” Phelan said. “It just has to be self-service, and it has to work.”
Pricing transparency is also important.
“From the beginning of the conversation, we were using radically transparent pricing as part of the PaymentSpring model,” Wilkinson said. “There’s a perception that there are a lot of shysters in the payment processing business, nickel and diming people.”
While the non-profit sector is a major focus for PaymentSpring, development of startups is also important.
“Nelnet and FireSpring are both involved in getting new businesses off the ground,” Phelan said. “We look for partners in the one-to-many space, reaching out and solving a problem for a segment.”
Both Wilkinson and Phelan see a bright future for PaymentSpring and expect competitors to follow their lead.
“We’re the first movers in this way of thinking, and we expect others to follow,” Wilkinson said. “When anyone innovates at the level we are, others will follow.”
Rod Armstrong is Vice President of Strategic Partnerships for AIM in Lincoln, Nebraska. He is a regular contributor to Silicon Prairie News.
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