Preparing for the New Economy

Overview and Origin

Founded in 2018

Founders

Patricia Montesi - CEO

Darren Beyer - Chief Product and Strategy Officer

Steven Bishop - Chief Information Officer

Robert Pincus - Chief Operating Officer

The birth of the Qolo platform stemmed from the company's mission to make complex payment transactions simple for business-to-business transactions. The "all-in-one" payments solution was officially launched in June 2020. This company is privately funded and Dun & Bradstreet reports that their annual revenue for 2020 (fiscal year end in October) is $174,088 USD.

Business Activities

Challenges of Cross-Border Payments

The B2B payments market within the payments industry is largely untapped by digital technology. The cross-border payment arena has not advanced in innovation as quickly as the overall payments industry due to its complexity. These transactions involve multiple parties, foreign fees, security risks, legal and regulatory framework varying by country, and many other challenges. Qolo aims to create a streamlined, integrated platform for every B2B payment - domestic to the United States and globally. Qolo emphasizes the importance of an all-encompassing payments hub that is fast, easy-to-implement, and secure.

Target Market

The company's intended customers are businesses involved in cross-border B2B payments. The total global value of the target customers is estimated to be more than $27 trillion and is expected to reach $35 trillion in 2022. These values vary among several market research resources by about $4-$5 trillion.

Competitive Advantage

Interact - Qolo's Embedded Processing capability, allows clients to be actively involved in each transaction. Qolo implements their processing functionality by directly integrating it into the clients' platform. Clients are not required to develop and build their own platform to accomodate their needs. This allows clients to maximize their capabailities with an easy-to-use, integrated platform.

Technologies - Qolo's comprehensive platform is flexible and does not require clients to go with a one-size-fits-all approach. Qolo does not disclose their proprietary technology, but the following is a high-level overview extracted from the Qolo website. They have filed multiple patents on their technology as they have built the platform nearly from scratch.

• Payments Hub - an omnichannel payment hub
• Accounts - proprietary rules engine
• Security - QoloCrypt, patent-pending qoloCrypto technology

Landscape:

• Qolo is in the Payments/Billing domain and sees a future in the cross-border B2B payments arena.

• Major Trends and Innovations - This domain has been slowly moving toward cashless payments within the last 5-10 years and now has come to an accelerated pace with the emergence of the COVID-19 pandemic. Artificial intelligence, blockchain, and machine learning as well as the innovation of real-time payments are disrupting cross-border B2B payments. Checks and bank transfers still take up the largest payment volume in B2B payments, but now B2B companies are diversifying payment methods. The decline of paper payment methods is at a much slower rate than the decline of those methods within the P2P payments arena.

• Major Players - PayPal, TransferWise, moneycorp, Visa B2B Connect, Remitly, Stripe, Tipalti, and Flywire

Results

• Qolo's Impact - Qolo has emerged as an "all-in-one" payments solution as this category is becoming increasingly common within the payments/billing domain. Qolo has recently partnered with moneycorp to research alternative innovative solutions to improve efficiency around digital payments, especially in foreign exchange markets. Upon Qolo completing integration with moneycorp, many businesses who seek cross-border payments capability are showing interest in what Qolo and moneycorp have to offer.

• Core Metrics

  1. Speed - most important for AP professionals' suppliers
  2. Security - needs tremendous improvement in reliability and security
  3. Costs - reduce fees with foreign currency transactions

• Qolo's Performance - Qolo is focusing on embedded processing, payments solutions, and cross-currency payments. With Qolo being a relatively new player in this domain, there is not much available information to gauge how well Qolo is doing compared to the core metrics and the core metrics of its competitors. However, Qolo has been able to identify the key areas to focus on for the future of this domain in order to tap into the underserved cross-border payments arena.

  "In terms of 5-10 years out, we feel international B2B payments is the biggest and most underserved area. Nearly $25 trillion a year of international trade and services business is conducted through banks. Companies are paying 3% in fees – they are overpaying, it isn’t automated, it is horribly inefficient and is ripe for disruption. When you combine this with an advanced AR/AP capability (something we have filed patents on), the opportunity is there to dramatically streamline and lower costs of business payments." - Patricia Montesi, CEO of Qolo

Recommendations

• Services

  • Prioritize their payments solution to serve the gig economy within the cross-border payments arena. This will require Qolo to provide cross-border real-time payment, which they plan on doing in 2021.

  • Gig workers say:

    • Would rather receive digital paychecks
    • Payout times are lengthy
    • Clients often do not pay gig workers on time
    • Payment processing fees are a problem

• Benefits

  • Freelancers choose which platform to use based on the payout timing and efficiency. These freelancers rely on the platforms to handle the cross-border regulatory requirements.
  • If Qolo focuses all their efforts with moneycorp to address the gig economy's top concerns, they will get a head start in capturing this market and over time the gig economy will shift away from traditional financial institutions.

• Technologies Utilized

  • Single API gateway
  • Crypto technology

• Appropriate Technology?

  • Qolo's constant improvement of both technologies will address the gig economy's needs.
  • A single API gateway allows Qolo to streamline and lower costs of business payments. Qolo can easily integrate their platform with clients' systems.
  • Crypto technology will allow clients to pay their gig workers in different forms of value.

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Resources

• Qolo - Website
• Qolo: The Swift Cross-border Payments Enabler
• Dun & Bradstreet - Qolo LLC
• A game changer for cross-border payments
• THESE 25 FINTECH PAYMENT SOLUTIONS MAKE MOVING MONEY FASTER, SIMPLER AND MORE SECURE
• The cashless economy: How fintech is approaching the future of finance
• The Evolving State Of The Cross-Border Payments Market
• B2B Cross-Border Payments to Grow by 30% to $35TN by 2022...
• On the Lookout: B2B Payments Trends in 2019 (Part 3)
• Value of cross-border payments worldwide from 2016 to 2022, by type
• Patricia Montesi: CEO at Qolo Explains how Fintech Firm’s B2B Payments Platform Is Helping Companies Settle Cross-Border Transactions
• Everything You Need to Know About B2B Payments & Solutions in 2020
• Global B2B Payment Trends 2020 - Global B2B Payments Turn Digital - ResearchAndMarkets.com
• B2B Payments Hub, Qolo, Partners with Cross-Border Payments Provider, moneycorp, to Launch FX Payment Solution
• B2B Cross-Border Payments Are Speeding Up
• Why the 'all-in-one' channel is rising in B2B payments
• Meeting The Payments Needs Of Cross-Border Gig Workers
• The Growing Gig Economy