Payrix’s Bob Butler on Finding Anchor Personas

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Ben Hillman

In the 1950s, Victor grew and introduced a new concept to the United States. This was a world where Main Street reigned supreme and the corner store was America's linchpin. This new fangled concept that Victor introduced was the shopping mall. A significant portion of what made these shopping malls successful was something called an anchor tenant. If you've ever been to a macy's JCPenney, Nordstrom, you know exactly what I'm talking about.

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Ben Hillman

These tenants came in other forms like grocery stores, gyms or movie theaters. The entire point was to use these tenants as a draw so that smaller stores would benefit from their gravity. After all, once you finished going to the gym, that corndog from the food court can be pretty tantalizing. While shopping malls may be soon a thing of the past, this concept still rings true in B2B SaaS.

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Ben Hillman

I'm sure you know by now how important it is to figure out your target personas. But what if you could figure out anchor tenant personas? What's better than a persona that brings in other personas? Today's guest is Bob Butler, the chief commercial officer over at Worldpay for platforms. In our discussion today, we get into the benefits of anger, tenants and more importantly, how to find your anger tenants.

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Ben Hillman

Additionally, we get into making waves in the fintech space. All that and more is coming up next. From Padel, it's Protect the Hustle, where we explore the truth behind the strategy and tactics of B2B SaaS growth to make you an outstanding operator. On today's episode panel, CSO Patrick Campbell interviews Bob Butler about customer development. We talk about why some fintech is really tech fit, reducing the time and friction to execute the buy now pay later space, the anchor tenant persona.

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Ben Hillman

And finally, how to find anchor tenants. Timestamps to each section are listed in the show notes, and after you finish the episode, check out the in the field guide that'll help you accomplish your customer development goals.

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Patrick Campbell

So who the heck are you? What do you guys do?

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Bob Butler

I'm Bob Butler. I am now the Chief Commercial officer at Worldpay for platforms prior to the president of Terex. We got acquired last fall and which is always nice in this in this business. Yeah, I've been doing fintech for the last 25 years. I mean, I was doing this stuff when it was still called Ecom. And so I've been through the ups and the downs.

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Bob Butler

You know, I've had a great product. Wrong time. Not so great product at the right time. And what was great about Pyrex was we'd finally gotten to a situation where I came in, met with the original founders. I was the first person that they brought in, and I saw the right product at the right time with the right solution for what's really happening in the marketplace.

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Bob Butler

So it was a lot of fun.

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Patrick Campbell

Yeah, just curiosity. What was the right product, wrong time? Oh.

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Bob Butler

What we do is we embed payment technology and other financial services inside vertically focused software. So think of a Jim, you know, Jim management software. So and I always use this example. My sister was was an executive with a with a big health care company, but fitness was her passion. And so she went and opened up a gym.

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Bob Butler

The first thing she did was find the location, buy the equipment. Number three is I need I need a software technology to actually run my gym. And so she picked this this software. And the first one she went with had this sort of janky you know, it did some billing, but it didn't really have payments embedded. So she chose a different software payments was embedded and and everything just went smooth.

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Bob Butler

It was frictionless. And so I saw that she had done that. And, you know, it was a shift in the marketplace. I met the original founders at Patrick's, Benny and Barak, and they had built a solution that actually could go out and we could scale this to actually create a bunch of you've heard of the company toast. So it's a point of sale software.

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Bob Butler

What our software allowed vertically focused software companies to do is to create hundreds and thousands of mini toasts. So think of a software to run your pest control business, a software to run your landscaping business, a soft, a software to run AI, obviously gym management, your hair salons, you name it. There is a vertically focused software for that particular business and that that is a relatively new phenomenon over the last call it ten years.

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Bob Butler

And so these guys had had built this product. I came in and we added a bunch of people to the team and we took this thing from from roughly, you know, four or $5 million in revenue to over 100 million in four years.

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Patrick Campbell

Nice. Nice little journey, huh? Fast journey.

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Bob Butler

Lots of fun.

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Patrick Campbell

Kind of curious to take maybe take a step back because I think a lot of SaaS folks listening and there's always this enamored meant one with like payments and like fintech because they have to charge money and you know, they buy these types of products. But also the fintech space is also kind of exciting because as you were kind of describing this been toast mind body, a bunch of these other products that have started to like embed fintech, how would you describe the fintech space?

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Patrick Campbell

Like if you're trying to teach like someone who's not a complete idiot, but someone who's like in this space, like, here's the scope of it, because I'm now in the fintech space because we just got bought by a payments company. And so it's like I'm trying to scope that out myself and I'm trying to sound like you have like the payments people, the billing people.

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Patrick Campbell

You got all this other stuff, like how would you describe.

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Bob Butler

Yeah, I mean, it's a great question. You know, the way that I view fintech is and you mentioned Mind body and a couple of the others, which I have a ton of respect for. I look at them as Texans. So so think about it. They're technology first and then they've embedded the financial piece of it. And I think every software company is going to be a tech fin.

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Bob Butler

And so to me, when I when I look at any kind of a fintech application, I'm looking for, you know, first off, what problem are they solving? And second, how is this going to make the life of whether it be the consumer or the small business owner or whoever it might be, how is their life going to be improved from that?

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Bob Butler

And sometimes it involves payments and sometimes it just involves information and making things sort of come together. And I was there in fintech back when it was not sexy. That one thing they always say I was country when country wasn't cool, I was fintech when fintech wasn't cool, and now it's cool, it's hot and everybody's sort of on it.

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Bob Butler

But to me it usually involves some kind of of financial application or financial information that's a part of, of any kind of a technology platform. So, you know, I've see some people claiming that they're fintech and I'm like, I'm really having a hard time seeing that. But the way I see the future is, you know, every technology's going to have some kind of financial application to it.

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Bob Butler

So it'll be interesting. I mean, I still think we're you know, I hate to use a baseball analogy, but I think we're maybe at the top of the second or bottom of the second inning kind of thing in what's going to continue to happen. Because I saw applications coming on, oh, go back to the late 2000. And what was interesting is those applications are being replaced by applications like what?

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Bob Butler

What page six brought to the table and what's you know, companies that I have a ton of respect for, Stripe and Adyen. But what's going to happen is we don't know where this goes. And so the next ten or 15 years is actually a pretty exciting time to be involved in fintech. So you should you should be happy that that you're doing this.

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Bob Butler

I mean, and you'll see how everything rolls. But, you know, it's funny, Bill Clinton, when he was president, made a comment. You know, I keyed in on, you know, I was really young at the time. He said young people should be looking at businesses that are involved with the movement of money. And I keyed into that early on.

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Bob Butler

I was yeah, yeah. It's not the correct quote, but it's somewhere along those lines. And if you look at life from the nineties all the way through now, I think it still holds true and I think, you know, you've got a bunch of old infrastructure that's in the payments space or in the insurance space or, or really in the banking space.

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Bob Butler

And you've got a bunch of new technology coming on and how all that sort of comes together over time is going to be super interesting.

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Patrick Campbell

To back up a second, I think you said I like the Texan, you know, kind of kind of not a metaphor, but turn a phrase that you used. So what are the different, like layers or vectors that a technology company can do? Right. I envision and I'll maybe start you here because I think vision like one of the easiest or two of the easiest, like if you're a consumer product offering up financing of some sort, buy now, pay later financing, etc. B2B product, you can do the same thing.

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Patrick Campbell

You can offer up payments, infrastructure for your customer, like what are the different things? If I'm like a tech company and I'm trying to add my fin, like what are the different layers that you think exist?

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Bob Butler

Yeah, So, so we looked at this, you know, me and Benny Silverstein, my the founder that at pay Rich, we started really digging deep into this a few years ago and and we created this this slide I now call it the crazy uncle slide because when we showed it to the board, they looked at me like I was crazy, you know?

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Bob Butler

And I got to give Benny and we worked on this together, but we were just looking at embedding payments at that time. But what you're going to see now is now you're seeing the advent, especially for small and mid-sized businesses through these technology platforms. Because when I go back to the sit my sister's example, she basically said if I never had to go to another a bank again, I wouldn't boom, The light went off for me.

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Bob Butler

She's like, So if you can start embedding banking into that technology platform, you know, I was I was a small business owner. Can you embed insurance? Because that was a pain for me to actually go out and get insurance for my little business. If you can embed insurance, embed payroll, embed, you know, issuing of credit cards and and embed lending, like you're going to see the entire embedded fintech space blow up in the next several years.

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Bob Butler

And this is borne out by real data, not just not just, you know, Bob and Benny working on a project together, skunkworks kind of thing, but really it's all about the shifting in distribution models. So instead of, you know, if you go out to State Farm to get my insurance and I have to go to Wells Fargo to get my banking and I have to go to chase payment tech to get my credit card processing, what's going to happen in the future is whether you be a small business or even a consumer, you're going to go one place that's going to be sort of your cool place and your technology platform or and that's why

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Bob Butler

what's happening now is so important. You're buy all your products from there. It's this a distribution model.

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Patrick Campbell

So when you're kind of trying to create that tech fin type company, it's kind of like the premise of my question is it's a little scary to get into like the finance world or like the because it's so different, right? And obviously you probably felt that pain the first time. If you're an operator getting into the SaaS world or subscription world.

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Patrick Campbell

But what's the gateway? It sounds like partnering or using a product like Pay Rex to shamelessly plug a little bit is probably like the first thing to do because you have to worry about all the back end. You just worry about like validating and, you know, adding that to your your idea, right?

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Bob Butler

Yeah. I mean, so one of the main reasons that the acquisition of Paper X by ISIS and Worldpay made so much sense was this big company, but has relationships with all the major banks around the world and all of a sudden you put those banks together with some of the, you know, the cutting edge technology that I pay Rex brings.

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Bob Butler

And we now have distribution for all of these products and services. So a tech fan or a software company or a platform can come to one place and say, okay, yeah, we we're looking for a really good partner here. And what's amazing is, yes, we can get our payment credit card processing services and that makes a ton of sense.

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Bob Butler

But our small businesses also need credit and that maybe in many cases their customers. So the small businesses, customers need credit. So think of a roofing contractor. So if you think of a roofing contractor software, we have the largest one on our platform in North America. We do their credit card processing. It makes sense that those roofing customers of them are going to going to require credit.

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Bob Butler

And even more important is the customers of the roofing contractors. Okay, All of a sudden I'm redoing my roof. It's $40,000 to redo my roof. I don't want to pay for all that all at one time. I need that to just come in. And if everything is smooth and frictionless, that consumer gets that credit to redo their roof through that technology.

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Patrick Campbell

Which they're and helps that software company's customer and then them themselves, like as a company.

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Bob Butler

Yeah. So think about it in the in the mix the software company benefits they're helping their their customer grow because otherwise they couldn't make that sale. And at the same time the consumer's getting a new roof. And along the way, all the people involved in the distribution of that, those loans and or, you know, collections of that, they're all able to make some money in the process, including the software company who's providing a ton of value for their customer.

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Bob Butler

So that's why I think the tech pin thing is so key because, you know, it's no longer okay, I'm a roofing contract and I'm going to the I'm going to the bank bank. You know, I've deposit my money and they might give me a loan. They might not. But now I'm going to my technology provider. They're not only.

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Patrick Campbell

Which I'm already going to. Yeah, yeah, yeah.

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Bob Butler

They're not only helping me collect my payments, but they're providing me with a method of of getting capital to grow my business. And they're helping my consumers finance the projects that I'm actually selling to them.

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Patrick Campbell

Like you said, something really interesting that I think is very obvious to you, but I think it's really important to double down on is basically where, you know, time and money are fungible. So really what's happening there is you are helping the software like a financial product helps. The software company, which they're in, helps their customers return, helps the end customer basically reduce the amount of time and the friction to just do stuff right.

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Patrick Campbell

Because the movement of money that you were talking about, that Bill Clinton quote, which is like basically like with the movement of money being a lot less friction heavy or a lot less have a lot less barriers, more stuff can happen over a recurring amount of time rather than like, we have to wait, wait, we will wait. Big sum of money.

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Patrick Campbell

We will a big sum of money.

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Bob Butler

Is that is that kind of the thing? Okay. I think it's not only frictionless, it's it's it's efficient. You know, I go back to some of the example my sister had. She the main reason she liked the embedded payment model of her technology provider was all about she has no reconciliation to do. She doesn't have to go to one system, balance it off the other system.

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Bob Butler

It just is clean and it updates within her software. So everything's sort of up to date and it's working really cool. Now, it's funny because when we went into the pandemic and everybody went out for PPE loans, basically what she had to do was download all that data from the software and go to this local bank. And they of course, sat on the application.

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Bob Butler

She ultimately got her PPE loan after one of my brothers, you know, sent a letter to the to the senators in Pennsylvania. That's crazy. Yeah, but it was crazy. But but the problem is, had she been able to just push a button, I'm requesting my PPE loan and you have all the data within the technology platform. That's how that thing gets smoothed down.

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Bob Butler

It's time and money and it's like you want to you want to be able to smooth things down and you want to keep commerce flowing.

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Patrick Campbell

And I think that's the last thing you just said is really important because especially in a B2B environment, theoretically, you reduce that time and makes things flow for your customer, which therein brings you more revenue because you get that flywheel going. And I think that what I have learned, at least in the financial space and the tech and space, however you want to structure it, is it's another flywheel that we haven't thought about as operators as much as we thought about, like the growth flywheel and retention flywheel, right?

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Patrick Campbell

It's like it's this new flywheel that seems scary because, oh, I don't know anything about D&D, anything about finance.

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Bob Butler

It's something about the net net revenue retention on this 100%.

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Patrick Campbell

That's right.

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Bob Butler

Yes.

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Patrick Campbell

It has to improve many different numbers inside the business, like I would bet and we could find this data where it would be interesting to see like a customer who has, you know, what is their acquisition volume, their retention, their monetization, like Lyft, if they're using a fintech product somewhere in their stack versus not, I'd probably really I should pull that to the upside.

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Patrick Campbell

That's really interesting.

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Bob Butler

It's a great data point that you should look at. And I think I think what you're going to start seeing, just because I've seen in the investments in the investor space, spending time speaking to a lot of these CS and pieces like they're all hot on payment on vertical software and payments and, and what's going to happen is like those metrics like net revenue retention and the stickiness of the client is going to be super key.

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Bob Butler

And I just go back to when I first started right out of college at Penn State, I started working for a bank and I remember I started actually in the retail side of the bank, so the branch part wasn't there very long, had to get to the commercial side where you make some deals happen. But what was interesting was I remember it was like you open up a DDA bank account and then you give them a credit card and then you get them a car loan and then you get them a mortgage.

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Bob Butler

And the next thing you know, in 15 years, you get them into the private banking group because they've made some money. And and and that is how banking works. Okay. Well, if you think of the same paradigm for technology providers, again, I looked at my sister's business. She pays 150 bucks a month for software. I know that her software company is making 40 basis points off that million dollars a year that she's running through her software.

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Bob Butler

That's $4,000. So what, 1800 in software revenue, 4000 in payments revenue. And it's so sticky that even though she might not like the software any longer, she can't move easily. And then so if you start thinking, if I can get a hook in to the on the lending side, if I can get another hook in there and I'm providing their payroll services or their insurance services, it's all about, to me, building total enterprise value of of the platform of the stack.

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Patrick Campbell

I think what's interesting too, is that the thing you just said about the basis points and payments, stuff like that, like part of the deal is for us was we're building software, we have a paddle that's a billing right. And so all of a sudden, like the way we monetize some of the software building can change dramatically because our LTV doesn't have to be contingent on, you know, this certain amount of expansion, etc., because, you know, we could theoretically in a vacuum lower that price.

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Patrick Campbell

Hopefully get more acquisition out of it, more spread, and then make all the money up on the back end, which is really exciting. And I think it's something that I haven't thought enough about. Obviously, like you're in the middle of it, which is interesting. But one thing that I find interesting about products like yours, actually, before I get to that question, buy now, pay later space.

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Patrick Campbell

Like from an outsider's perspective, it was super innovative, but then there's so many of them and then like everything's 0%, right? What's your take on all that? Is it one of those things that, you know, people are just over their skis and that's always going to happen in different, you know, industries, whether it's fintech or not, or is it something where it's like, no, like the models do support.

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Patrick Campbell

You know what? What's your feedback on that? Because that's it's kind of interesting because it's like, I would want to add that to my app, but it's like there's so many of them is just going to burn up in my face at some point, that type of thing.

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Bob Butler

Yeah, but to me it's like first off, you know, full disclosure, I'm an angel and in a small buy now pay later. And again I backed the founder on this and it's it's not one of the big ones but if you really look at buy now pay later Yeah the barrier to entry on that was not really high.

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Bob Butler

So clearly Klarna had come out early on in the game and they created the market. Depending on who holds the credit risk on this, it always goes back to who's holding the paper. Like to me, you know, I've used buy now pay later myself, you know, through my American Express or through my Citibank card just to try it out.

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Patrick Campbell

Okay. I was going to ask. I was like, why? I imagine your need to like you.

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Bob Butler

Need to like I did last year.

00;20;57;28 - 00;21;00;29

Patrick Campbell

I was I was curious if it was more than just. Yeah, well, curiosity.

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Bob Butler

Know, it was just like I wanted to see how this thing was 0%. I'm going to try it out and.

00;21;04;25 - 00;21;05;12

Patrick Campbell

See what happens.

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Bob Butler

When I am paying it off because I'm like, Yeah, this leaves balances that show on my credit report. Like, you know what I mean? Like, and I'm used to pay my credit cards off 100% every month, so I ended up not doing it. So for me, I'm not that I'm not the typical consumer as it relates to those kind of things, but my concern has always been on buy, Now pay later is, you know, I got a credit card when I was in college.

00;21;27;22 - 00;21;33;01

Bob Butler

I think as a junior in college, you were given these credit cards out. There's no way I should have had a credit card back then.

00;21;33;11 - 00;21;35;21

Patrick Campbell

And you wanted the free T-shirt for the application now?

00;21;36;00 - 00;21;57;26

Bob Butler

Exactly. And of course, you know, I ran that limit up like with any within a guess what, maybe 1000, $2,000 limit. I ran that stuff up and so I didn't understand it. And I think we run the same risk with buy now pay later. I listen to Scott Galloway a lot and he always comments and he's hot against buy now pay later for consumers.

00;21;58;12 - 00;22;08;22

Bob Butler

From my point of view, depending on who's holding the bag, like at the end of the day and you know because buy now, pay later doesn't there's not a lot of credit checks on that so we'll.

00;22;08;22 - 00;22;09;19

Patrick Campbell

Froth in the market.

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Bob Butler

But yeah, it's a little frothy and I think people just got a little bit I think you were spot on. They got out ahead of their skis. But with that said, you know, I think where the applications make sense, where you've partnered with the right merchant, who knows who their customers are. I think buy now, pay later can be a strong thing.

00;22;28;03 - 00;22;31;14

Bob Butler

But I clearly think it's it's do for our right size.

00;22;31;15 - 00;22;51;07

Patrick Campbell

Yeah that's where it kind of happens with I would say like any debt looking products. I'm sure in this space it's like people try to push the leverage that they can because they're start up and they want to like grow really quickly. And then yeah, it depends on who's holding the paper, that type of thing. So probably something like be concerned about if you're going into the tech, then you know, move well.

00;22;51;07 - 00;23;08;25

Bob Butler

And that's why I think the tech thing partners need to be looking at that like risk is to me the number one thing like some companies, you know, even on the payment side, there's there's credit risk. You know, even though the payments are coming in. And we always tell our platforms like, how much risk do you want to hold?

00;23;09;03 - 00;23;33;08

Bob Butler

You know, some some platforms like let's call a restaurant point of sale, like there are hardly any risk. I mean, if they swipe the credit card, you know, you delivered the product at the time of service, but then there's other software where there's risk of an advance delivery, you know, you know, a delayed delivery. So they pay today, but that product or service doesn't come in for, you know, think of travel like you make that deposit on your your cruise.

00;23;33;16 - 00;23;56;14

Bob Butler

You're not going on that for 12 months. And, you know, if you're the software platforms, you really want to hold that risk. And that's where finding good partners both on, you know, the collection of of money as well as that, you know, loans and other things, finding partners who are willing to pick up some of that risk. It's going to cost you a few basis points here and there, but it's definitely worth it.

00;23;56;14 - 00;24;02;22

Bob Butler

It worth it at the end of the day.

00;24;02;22 - 00;24;26;20

Patrick Campbell

One of the horror stories, remember Fyre Festival that that big thing, there's a company called Table List out of Boston and they had partnered up with the guy who was running Fyre Festival to like basically be the post system for all the payments online. And they got left holding the bag and it and it was like it was millions of dollars in prepayments that all the cash had been basically spent because they had advanced it and it's yeah.

00;24;26;20 - 00;24;48;04

Patrick Campbell

So there's there's definitely risk there and I think that's why like finding partners who are both reputable and are going to be around a lot but actually a little bit of a tack change. I'm curious, the one thing that I think you guys did well and also that I think a lot of companies, whether they're fintech tech than just tech, etc., is finding those like ideal customers, like those beachhead customers.

00;24;48;04 - 00;25;04;16

Patrick Campbell

And then really kind of doubling down on using them in many different ways. Right. And so I'd love to kind of go through that. Why do it? How do you do it? How do you utilize it all that kind of stuff. So so maybe loosely, I'm kind of defining maybe you define it like what's what's important? What am I getting that?

00;25;04;16 - 00;25;25;16

Bob Butler

Yeah, no, I mean, hey, I think at the end of the day, we're here at a great conference and people come in with some great ideas and great products and, you know, especially on the product, like kind of, kind of, kind of companies, it's like they built something super cool. And, you know, my question, you know, especially when I started with with the guys at Paris, I'm like, who's our ideal client?

00;25;25;16 - 00;25;43;18

Bob Butler

Like, like, to me, the most important question is and at first we sort of, you know, screwed around trying to figure out like, well, let's go after these guys. Yeah, that's not going to work. And then, you know, so we honed in on, on some real tight firm or graphic demographic kind of data on each of the customers.

00;25;43;18 - 00;26;08;28

Bob Butler

And then then we made them our ideal clients like. And what I did was, you know, we went out and signed, you know, the, you know, what we call anchor tenants. And to me, you know, it's super important for any software company, really any company, because if you think about this anchor tenant strategy, what it really is is what what hometown mall developers have been doing for decades.

00;26;09;08 - 00;26;30;18

Bob Butler

So when you think of your hometown mall, what do you got? You got Macy's and Nordstrom. You know, back in the early 2000, Abercrombie was an anchor. So the anchor tenants are who bring in all of the other retailers into that mall. And so the way that I approach this, not only here in Paris, but the way I look at everything and it's like, who are the ideal customers?

00;26;30;21 - 00;26;49;26

Bob Butler

Okay, really tighten that up like, no, exactly. Okay. They're going to have 10 to 250 employees or they're going to have ten to, you know, just the super basic stuff, really understand who the buyer persona is. And I mean, are you selling to the head of technology? Are you selling to the CEO or are you selling to the head of sales?

00;26;49;26 - 00;27;17;27

Bob Butler

Like these are basic questions. But, you know, yes, you might talk to every one of them. But the fact of the matter is who is really the ideal one and then bring the land those customers and then treat them like royalty. Like and if you treat them like royalty, they will end up being your biggest advocates as you start to sort of land and expand and all of a sudden, you know, you can use that customer for the reference for these other five customers.

00;27;18;09 - 00;27;25;12

Bob Butler

In theory, you know, they become your Nordstrom, they become your Apple store, they become your Abercrombie.

00;27;25;12 - 00;27;40;27

Patrick Campbell

So if so, if we back up a second anchor tenant, I get the metaphor. It's perfect. What's a good anchor tenant look like? That Sounds like they're in their ideal persona. Yeah. Is it a certain level of brand cachet? Like I mentioned, you mentioned Worldpay. I've heard of Worldpay, you know, I mean, even I don't know. They do.

00;27;40;27 - 00;27;45;03

Patrick Campbell

I know Worldpay right? Is it like that? Like, what should I be looking for in a great anchor tenant?

00;27;45;03 - 00;28;08;08

Bob Butler

Yeah, to me it's to me it's less about brand, it's more about who they are in their product, you know, in their, in their market. So one of our early anchor tenants is in a space that is in the self-storage industry space. So it's a vertical software that serves owner operators of self-storage units. So when you think of that, like, wow, that's an interesting esoteric.

00;28;08;08 - 00;28;11;14

Patrick Campbell

How big is that business? I don't even know. Yeah, yeah. It turns out there's a business there.

00;28;11;16 - 00;28;40;10

Bob Butler

Well, that's why, like it is run by an amazing group of people out of Austin. They are the number one player in this space. They've built quite an amazing business. And all of a sudden, if you go to your next ICP, which might be a vertical, in our case, a vertical software in the in the not for profit space, I'm able to say, Hey, by the way, I have these guys over here, they're number one in their vertical.

00;28;40;28 - 00;28;55;18

Bob Butler

You should talk to them because you're number one in your vertical and it might make a lot of sense and oh, boom. So it was less about branding and more about making sure that it's relevant to your other ideal client.

00;28;55;23 - 00;29;10;05

Patrick Campbell

So it's easy enough to be like, All right, we got to go find this person. They're going to go after, you know, I can then talk to the next person, be like, Hey, look at these guys. They're doing everything and they're actually doing it rather than just like the kind of half assed did it and then gave you their logo permission.

00;29;10;05 - 00;29;16;24

Bob Butler

Yeah. To meet your ideal client have to be, like among the best people in their G2 space.

00;29;16;24 - 00;29;20;05

Patrick Campbell

Sure, sure, sure. That's great. That's a good that's a good limits on it. Yeah.

00;29;20;06 - 00;29;42;11

Bob Butler

You know, if they're if they've gone below market ratings, you know, ten customers like things of that nature. Like that's in our case that we didn't want that. And I always I always think it's super cool when they don't have a G2 space or like what we did like you know, G2 space for embedded payments. Yeah. Okay. Or embedded fintech.

00;29;42;11 - 00;29;45;11

Bob Butler

But that's awesome for us because now we can actually create that.

00;29;45;11 - 00;29;45;24

Patrick Campbell

Space.

00;29;46;03 - 00;30;18;01

Bob Butler

And that's how I view everything. But, but yeah, when we were creating anchor tenants, like we talked to our investors, we talked to a lot of other investors and then we really assessed the market and we picked, you know, I'm the number one roofing contractor and what was interesting about making those guys one of our anchor tenants was, yeah, it's a super esoteric, specific vertical, but their number one in that vertical.

00;30;18;01 - 00;30;33;16

Patrick Campbell

So a couple of questions. I'm going to take it here. How did you find them? Yeah, how did you convince them to use your products and then how do you use them now that they're customers? Right. And so, like, I'm assuming you didn't you weren't like, I know the number one roofing contractor, you know, that type of thing.

00;30;33;26 - 00;30;35;11

Patrick Campbell

So what was the search space like?

00;30;35;11 - 00;30;57;11

Bob Butler

So so what was interesting, you know, we use that that particular example. So once we had identified, we wanted, you know, companies in a vertical software. Yeah, yeah. We were specific because we, we started seeing and the, you know, in the info bought out, we started seeing a lot of small and midsize businesses moving away from just using QuickBooks.

00;30;57;19 - 00;31;19;21

Bob Butler

They might still use it, but they were going to not a full CRM but sort of this quasi small business CRM very specific to their industry. So that's how we found our ideal client. We're like, Wow, this is actually happening. And then, you know, I was like, okay, you know, let's pick a few verticals. And that we think might apply.

00;31;19;21 - 00;31;26;10

Bob Butler

So we started with eight, we moved to 16. We now had 24, you know, ultimately got to about 24 and.

00;31;26;10 - 00;31;31;01

Patrick Campbell

We're just like Googling, like, where are you just or you're like, I wonder if there's software here. Let's find out.

00;31;31;06 - 00;31;36;27

Bob Butler

I really want to go through that. Like, like the real truth was I went out to Cap Tara and G2 and.

00;31;36;27 - 00;31;37;10

Patrick Campbell

Just started.

00;31;37;10 - 00;32;00;04

Bob Butler

Looking and I just started I said, okay. And what I did and you know what the founders what do we do all day? Oh, I just take my dog to the vet. Oh, there's got to be veterinary software. Boom. We saw a whole list of veterinary. And these are these are the names. And then it was I was working on a project on a house, and I'm like, Oh, there's got to be general contractors.

00;32;00;13 - 00;32;18;07

Bob Butler

Okay, well, once I hit that, I saw something in there that got us over to roofing contractors and plumber software. That's for plumbers software, you know, And then we just started dividing that up and going through the list. I mean, is it just superstitious?

00;32;18;07 - 00;32;21;15

Patrick Campbell

No, that's really smart because G2 and Tara did a lot of the work for you.

00;32;21;20 - 00;32;28;25

Bob Butler

Well, and the funny thing is I called both G2 and kept Tara up and I'm like, Hey, can I buy these like all these downloadable years?

00;32;29;07 - 00;32;30;22

Patrick Campbell

And they're like, No, no. They're like.

00;32;30;22 - 00;32;38;02

Bob Butler

No, that's not what we do. Do you want to go up on our site? I'm like, We don't have that kind of money in, you know, we were tightly funded start up.

00;32;38;02 - 00;32;41;13

Patrick Campbell

So okay, so we found them. How do we convince them?

00;32;41;16 - 00;33;00;17

Bob Butler

Yeah, So we just reach out to them. And in that particular case of that one, they were they had some older kind of a partnership with a what I call a legacy processor. And they said, Hey, matter of fact, we know we need to look at this. We got right to them the CEO and the head of product and they're like, Yeah, well, we'll take a look at you.

00;33;00;17 - 00;33;16;02

Bob Butler

And they looked at us and they looked at Stripe and, you know, we came in with what we thought was a more compelling offer. And we told them upfront, you know, guys, we're backed by these guys. We're not super huge yet. And you're going to be the marquee customer.

00;33;16;02 - 00;33;18;01

Patrick Campbell

You're our anchor, so you can get all of our attention. You can.

00;33;18;01 - 00;33;18;12

Bob Butler

Get all the.

00;33;18;12 - 00;33;29;24

Patrick Campbell

Attention. That's great. So just kind of like a classic, almost a classic, but like a sales process with the facts and figures that you had. And then so how do you use them? So I'm sure like case studies.

00;33;29;24 - 00;33;49;12

Bob Butler

Brain studies, white papers, blogs, podcasts, old school references, cause, you know, all of a sudden now you are talking to that plumbing software or that lawn care software. They need to talk to somebody and they need to know that somebody is either on that G2 or cap tarot list and where they are.

00;33;49;12 - 00;34;07;19

Patrick Campbell

I'm sure, you know, it's funny, it's a little different going back a little bit. I'm sure there's a value in you just sell it like this. There's no reason for you to sell this list. But now I'm thinking, I'm like, It'd be really cool to have like a taxonomy list from G2 of all these different verticals. Like, it would be valuable just to know, like something in chiropractic.

00;34;07;19 - 00;34;08;18

Patrick Campbell

I'm sure there's software that.

00;34;08;18 - 00;34;09;23

Bob Butler

Like various sort.

00;34;10;07 - 00;34;18;20

Patrick Campbell

Of parts. Yeah, yeah, yeah, yeah. Chiro touch and a bunch of other ones. So no, it's really cool. And I guess the anchor tenant strategy, you know, you're four years in.

00;34;18;20 - 00;34;19;28

Bob Butler

And you and you hope that they keep.

00;34;20;05 - 00;34;30;11

Patrick Campbell

Because of course, of course right. Because then you know it helps kind of the flywheel there is this like a first year thing and then kind of go from there. Are you constantly because your products evolve and getting more anchored? Yes.

00;34;30;17 - 00;34;35;08

Bob Butler

I mean, I think for us it was the first couple of year thing. You're only.

00;34;35;08 - 00;34;36;22

Patrick Campbell

Four years old, so it's a little hard to sell.

00;34;37;07 - 00;34;50;20

Bob Butler

A couple years older than that. But four years of really, really high growth. Yeah. What I would say is, you know, it's early on, get the anchors in and now, hey, just like any mall or J.C. Penney and cheers go out of business. Yeah, that's.

00;34;50;20 - 00;34;51;17

Patrick Campbell

True. Yeah. Okay.

00;34;51;26 - 00;35;09;19

Bob Butler

Yeah. You got to find someone to fill that spot, You know, shout out to Sears. I have a friend who still who. Who's running? Still not. Yeah, still not in driving the business. So I'm going to send him to the podcast and let him know that I mention his name. But. But, but they open in brand new Sears location in Puerto Rico this year.

00;35;09;19 - 00;35;12;05

Bob Butler

So Sears and Kmart are still going strong.

00;35;12;06 - 00;35;14;21

Patrick Campbell

Well, it's like it's just the business evolves something else.

00;35;14;21 - 00;35;33;14

Bob Butler

Sure. Yeah it's cool but that's what you do like you're you're going to lose an anchor. Yeah. Okay. And you might lose it because they got acquired or you might lose it for whatever reason. Now, we've been fortunate. We haven't lost any of our anchors. But what I will tell you is we need to have another anchor behind him to replace him.

00;35;33;18 - 00;35;38;26

Patrick Campbell

That's great. Awesome, man. This is so good. Like, where can people find you? Anything you want to plug? Anything like that.

00;35;39;01 - 00;36;04;09

Bob Butler

Like I said, I'm I'm driving all the commercial business, marketing, sales, all that for worldpay for platforms. But my email is still pretty simple. It's just Bob at pay rex pay. Why are I XCOM? I'm on LinkedIn you know all those fun places. Yeah I mean hey we're here to talk to any vertical software that wants to talk about embedded payments or embedded fintech Embedded banking, Embedded lending.

00;36;04;17 - 00;36;09;19

Bob Butler

That's what we're all about. And that's that's, that's my plug. But but I've really enjoyed the time today.

00;36;09;19 - 00;36;11;01

Patrick Campbell

Yeah, it's it's good, man. Awesome.

00;36;11;09 - 00;36;13;11

Bob Butler

Great.

00;36;13;11 - 00;36;40;05

Ben Hillman

I'm a huge shout out to Bob for doing this podcast. Now, you know all about Bob's worldview on customer development. Today we talked about why some fintech is tech thin reducing the time and friction to execute the buy now pay later space, the anchor tenant persona and how to find anchor tenants. If you want to support Padel in the show, we'd really appreciate it if you let a five star review of this podcast or the equivalent rating wherever you listen or watch.

00;36;40;13 - 00;36;48;04

Ben Hillman

Thanks for listening and make sure you subscribe to and tell your friends about Protect the Hustle, a podcast from Paddle.