Financial tech startup, Finexio, once located in Silicon Valley, is growing its business in Orlando and redefining the nature of Business to Business (B2B) payments.
If, as some financial and tech pundits have noted, the future is paperless, it is a wonder so many companies are still using paper checks to handle accounts payable. Each year in the United States, $12 trillion in B2B payments are made by paper check, which can cost more than $9 each to process, mail and reconcile. Most mid- to large-market businesses in the United States are still paying many suppliers with a pile of paper each month, and if they are working with a bank to distribute business payments, they are probably dealing with a lot of manual processes, limited payment types and inflexible rates for their suppliers.
Enter Finexio …
A startup that opened its doors in Silicon Valley in 2016 and moved to Orlando in early 2017, Finexio has built a platform for businesses to eliminate paper checks from transactions. By using Finexio to send payments electronically, clients can free up their back office and unlock the cash hidden in their payments. The business has developed nine payment options that route client payments with high-level security, and if any checks remain, the company will digitize or mail them. Finexio software plugs seamlessly into existing systems, which means no new technology is required to integrate. The company also supports the entire process with world-class customer service and operates at no cost to clients — the company gets paid when it generates revenue for clients through bank rebates and discounts.
Having grown up in Orlando, Finexio CEO and Founder Ernest Rolfson moved to Northern California when a great job opportunity presented itself. “My financial technology exposure in Silicon Valley sparked the idea for Finexio,” explained Rolfson. “You hear about FinTech all the time now, but there are different verticals within that sector, such as crypto currency, asset management, electronic trading and payments; we’re in the B2B payments area.”
As businesses demand more global solutions, speed and transparency, investors are paying more attention to B2B transactions and the companies providing solutions in that arena. Recently, Finexio raised $4 million in Series A funding to expand its sales and marketing push. The money will allow the company to pursue business in several sectors, including real estate and construction, while also improving the platform.
From Silicon Valley to Central Florida
The initial idea of a B2B payment company hit Rolfson in early 2015 and took hold when he was working for a healthcare company in Northern California that provided revenue and payment cycle management and clinical information exchange solutions, connecting payers, providers and patients. The healthcare company mailed more than $100 billion in payments a year. This outdated, manual process, Rolfson quickly realized, was both time-consuming and costly.
“I was in a job in the heart of the innovation economy where I was exposed to a number of creative ideas, and I was in a position where I was tasked with investing in and acquiring companies,” he explained. “Part of my job was to look at the best innovations and technologies, as my personal area of expertise is financial technologies and payments processing. I saw how my company was trying to address some of these payment challenges but was falling short.”
Rolfson identified where customers were unhappy, complaining or not having a need met, and he also saw what the market competitors were doing. His conclusion was that a real need and opportunity in this particular space existed. “My company was certainly not going to pursue this, and they were one of the biggest players in the space,” he added, “so why not fill that void myself?”
A great deal of research, PowerPoint presentations and fundraising followed. After raising his first $1 million to get the company off the ground, Rolfson realized that staying in Northern California did not make much sense given that his personal, work and investment spheres were on the east coast. He admitted his return to Orlando last year was fueled in part by a desire to move back home, as well as the growth of options for young companies here.
“When I left Orlando, there wasn’t an option of being a startup here, but it has changed a lot from then until now,” he asserted. “Also, our first few customers were on the east coast, including Morgan & Morgan, so it made it even more palatable to be here.”
Cost was another consideration for Rolfson. “Orlando is a place you can make a good living, and it’s still affordable and the taxes are reasonable,” he said. “It’s safe, it’s growing. It’s a desirable place to live. No, we don’t have mountains and vineyards here, but we have the ocean and sunshine all year round. Orlando checked a lot of boxes for us.”
A Bright Future
Rolfson acknowledges that despite Finexio’s positive growth, there are always going to be challenges and bumps on the startup road. As an entrepreneur who once described starting a company as “like getting punched in the face 50 times a day,” he does not take anything for granted, but he likes the direction in which the company is going.
“It looks like we’re on track to achieve what we set out to achieve,” he said. “We’re trying to become a $50 million business in five years, and we should be able to achieve or beat that plan, but it’s all about getting the right team in place in order to grow and succeed. We’re still in the first few innings of that, but I think the early results are good. We’ve built a product that customers want, and more customers are finding us.”
For entrepreneurs looking to start their own companies, Rolfson believes it is about learning and exploring, and also finding mentors who can provide insight and understanding. He also stressed you can’t be afraid to go against the grain and fail.
“Mostly, I think it’s a lesson in humility; it’s a lot tougher than you think,” he explained. “If you’re going to do something impactful, you need the guts to take the plunge and the perseverance to get up when you fall down. Equally as important, you need to be passionate about what you’re doing and care about the customers you want to help and touch.”