Attracting and Retaining Top Partners with a Best-in-Class Payments Experience

1. Tipalti Confidential – Do Not Distribute Rob Israch | CMO Attracting and Retaining Top Partners with a Best-in-Class Payments Experience
2. Tipalti Confidential – Do Not Distribute Increasingly Competitive Crowd Space = More Selective Partners • Harder to attract • Harder to retain • Provide a great experience • GO GLOBAL to expand supply
3. Tipalti Confidential – Do Not Distribute Global Partners Grow Your Crowd Benefits • Expands population of providers • 24x365 potential • Controls margins with Hub & Spoke model • Adds diversity to offerings Challenges • Process complexity • Scale issues • Risks & regulations 74% Would leave a marketplace because of a payment issue
4. Tipalti Confidential – Do Not Distribute 5 Steps to a Best-in-Class Payments Experience
5. Tipalti Confidential – Do Not Distribute # 1 – Automate Partner Onboarding • Stop using unsecure email for payment onboarding • Enable payment choice (method, thresholds, currency) • Provide 24x7 access to payment settings and status • White-labeled portals ensure trust • Portals should guide data entry to reduce errors 71% Payment choice is important to establishing loyalty
6. Tipalti Confidential – Do Not Distribute #2 – Develop Cross-Border “Intelligence” • Global payments are complex – over 26,000 rules • PayPal? Global ACH? Wire? ACH? Currencies? • Payment errors are big headaches • Return fees are expensive • Multi-entity visibility is critical 67% ”Pay me in my local currency” – Non-U.S. partners
7. Tipalti Confidential – Do Not Distribute #3 – Be Proactive in Communicating Payments Info • Send payment status notifications automatically 74% Would leave a marketplace because of a payment issue • Enable 24/7 payment portal access • Guide partners through payment issues
8. Tipalti Confidential – Do Not Distribute #4 – Be Tax Compliant • Payer responsible if Payee doesn’t provide right forms – 30% penalty! • W-9, W-8 series, VAT • Must verify tax details during onboarding • Withholding calculations prior to payment 60% International partners were not asked for W-8 series forms
9. Tipalti Confidential – Do Not Distribute #5 – Stay “Lean” to Scale • Reduce friction internally and with partner relations • Maintain operating margins • Establish infrastructure to grow with you • Integrate all payables workflows & with ERP • Don’t let growth kill your success 96% Partners said payments are important
10. Tipalti Confidential – Do Not Distribute Review: 5 Steps to Best-in-Class Payments 1. Automated onboarding 2. Cross-Border intelligence 3. Proactive communications 4. Tax compliance 5. Lean, scalable operations
11. The Payables Automation Solution for Today and Tomorrow
12. 12 Tipalti Confidential – Do Not Distribute m 98% Customer Satisfaction | $7B+ in Transactions Managed Annually | 4M+ Payees Solving Crowdsourcing Payment Operations
13. Tipalti Confidential – Do Not Distribute Questions?
14. Tipalti Confidential – Do Not Distribute Thank You! @risrach / @tipalti

Editor's Notes

Thank you, everyone. And thank you to CrowdsourcingWeek for inviting me. My name is Rob Israch. I’m the Chief Marketing Officer at Tipalti

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Crowdsourcing and online marketplaces are becoming a bit crowded (pun intended). Every day, new services are coming up and even more traditional brick-and-mortars like Ikea – who acquired TaskRabbit - are starting to adopt crowd and marketplace models. On the consumer side, that may mean we will slowly start being overwhelmed by choice – we’ll see.

But on the partner side, there is definitely going to be some challenges in finding high quality, reliable providers for your business. If you have a driver who’s signed up on two ride-share marketplaces, who do you think she will choose? Probably the one with the most consistent reward and are the easiest to work with.

So operationally networks need to improve their processes. We’ll touch on that for sure, but there’s one way to increase the available supply chain. Go global!
Automation must happen on the partner side. If you’re still onboarding partners through email or other manual methods, scalability is going to be elusive. And for partners in other countries, it can be frustrating and insecure. That’s where a branded partner portal comes in.

First, why branded? Not only does it associate the partner process with the brand, it provides a level of trust. For cross-border partners, they want to make sure you’re a legitimate business. A comprehensive partner portal is part of that experience.

The portal offers a way to standardize input and it puts the data entry tasks on the partner, not your staff. This is especially important when it’s time to enter payment details. You’ll want to ask the country for the partner, then present them with payment options that might work for them. Remember the 26,000 payment rules I mentioned in the last slide? Your portal needs to incorporate those rules to ensure that payment details like PayPal addresses or bank routing information are asked. The portal can also be the way to capture invoices or tax details. More on tax later.

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Does anyone remember Wall-E? In the movie, Wall-E was stuck on a dystopic Earth where he was programmed to sort garbage. He had tons of garbage to sift through and categorize. That’s kind of like deciding how to pay a global partner. You have to classify each one and figure out how best to send them their money. It’s really easy to make a mistake.

For example, electronic remittance and banking in Bangladesh is horrific. As it is in Vietnam or Turkey or Indonesia or just about any place that’s not part of the G10 countries. Paypal works in some countries, but it’s not the best for others. Even in Israel, did you know that they prefer to have US currency and US PayPal accounts instead of an Israeli one? It’s complicated. It’s not a job meant for a human being. It’s a job for a robot.

At Tipalti, we’ve identified over 26,000 payment remittance rules that span everything from the country and payment methods.

And you want to be accurate. A misplaced decimal or zero can mean you’ve sent out $10,000 instead of $1,000. But payment errors are a big issue. Let’s say your partner base is 1,000 people that you pay every month and you have a 2% error rate. That’s 20 errors per month. If you’re spending an hour to investigate and fix those errors, that can add up. An FTE at $60K dealing with this will amount to over half their salary.

So you need cross-border payment intelligence that truly understands how to get funds from you to all the various partners all over the globe.
Portals are 24x7. For global partners, it means they can provide their information whenever they want. More importantly, the portal acts as a two-way communication method. ”Where’s my payment” is the most common inquiry businesses get and with the portal connected to payment data, none of your staff ever need to answer the phone or respond to emails or twitter DMs. Instead partners can log in and view the payment status whenever they want.

Portals can also be localized so that language barriers can be overcome. That’s not so easy to do over email.

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I mentioned partner tax data collection. We’re talking W-9 forms, but we’re also talking about the lesser known W-8 Series forms and VAT IDs. In fact, the IRS is getting very serious about trying to collect taxes. While it may seem a million miles away from crowdsourcing and online marketplace partners, it’s not. Because if you don’t collect adequate forms from your partners, the IRS has to make an assumption that they are not exempt. In theory that means they can assert a penalty.

And the penalty isn’t on the payee. It’s on the payer, and it can be up to 30% of the transaction. That means a $5,000 payment to a partner who you didn’t collect proper tax documentation for is liable to be a $1500 fine on you. And of course, if the IRS is auditing your partners, they may start to find other areas of the business they need to look into.

So by all means, get and verify partner tax details during onboarding. Don’t wait until the end of the year when that partner may have moved or maybe stopped working with you. Make it part of the process.

We had one customer who was operating a creative asset marketplace and they were at risk for nearly $120,000 in fines. Suffice to say, it’s cheaper to be in compliance than not.

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Before you can endeavor to go global with your partner-base, you have to shore up the processes you use to work with your partners. Many of you, unless you have a huge round of funding - congratulations by the way – you are probably smaller companies. You’re going to penny pinch and figure out how to operate lean rather than spend a lot to hire a ton of staff to get your footing. But size shouldn’t deter you from going global. You just need to have a lean philosophy.

In the realm of payments, that’s where automation has a big benefit. Partner payments has traditionally been solved by bringing people in to do it. It takes a lot of effort to collect the information from partners to make them payable. Then that team of people are asked to manage the various payment accounts (wires, ach, paypal, check) and at the end of the month, roll it all back up into a ledger.

And being lean, especially when it comes to partner processes like payments, benefits domestic partners as well. If you’ve optimized the effort to buy from you, you need to optimize the effort to sellers. And the key to operating lean is finding specific ways to automate. In e-commerce they have a philosophy that for every dollar you put into automation, you get $10 of return.

It really is the difference between taking a bunch of people on an elevator or having everyone walk up the stairs. If you’re going up one flight, it’s not a big deal, but if you aspire to get up 20 to 30 flights (which your investors probably would like to see), you need a faster, more streamlined way up that doesn’t leave everyone tired and sweaty.

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Making sure payables is done right is where Tipalti can really help your company
We provide a better way to manage your entire payables operation, so you can be more efficient, compliant with tax and regulatory rules, and scale your business.
Entire end-to-end accounts payable workflow is in one easy-to-use, modern system across all of the areas you see here on the slide
Tipalti actually supports two different workflows for how payments can be made
In the digital economy, companies like ad and affiliate networks, online services, content monetization networks, hundreds and thousands of payments are made to partners in mass and performance marketing systems are often used to identify how much each partner is owed. Tipalti integrates with systems like HasOffers, CAKE, Paladin and LinkTrust to name a few, or you can easily prepare payment instruction files.
For other more traditional industries, such as software, eCommerce, and business services, suppliers send invoices, which determine payment amount, or what you may refer to as invoice-backed spend. Tipalti has a complete invoice management module to help process and pay invoices.
You’ll hear how Phil and Tony use Tipalti today in just a bit, but before we get to that, I want to quickly highlight a use case for invoice-backed spend with multiple entities around the world
Because of our unique holistic approach, we have hundreds of customers, from fast-growing startups to established companies across various industries, that benefit from Tipalti.

We have many resources dedicated to get you up and running quickly and to assist as you encounter new needs as your business grows. The ongoing support our clients receive and the breadth of our offering is why we 98% customer satisfaction. We scale and grow with your evolving needs.

Attracting and Retaining Top Partners with a Best-in-Class Payments Experience

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