As small and medium-sized businesses navigate economic uncertainty, here’s a question to consider: Are your payment systems an asset that drives growth, or are they just another expense?
Today, we’re joined by Brian Goudie, CEO of Aurora Payments. With nearly 30 years in the payments industry, Brian has guided Aurora to serve over 27,000 merchants, equipping small and medium-sized businesses with the tools they need to thrive in changing economic climates. Known for his community-centric approach to fintech, Brian is here to share insights into how the right payment systems can support business resilience and growth.
Resources
Aurora Payments website: https://risewithaurora.com/
The B2B Agility podcast website: https://www.b2bagility.com
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Transcript
This was AI-generated and only lightly edited.
Greg Kihlstrom:
Today, we’re joined by Brian Goudie, CEO of Aurora Payments. With nearly 30 years in the payments industry, Brian has guided Aurora to serve over 27,000 merchants, equipping small and medium-sized businesses with the tools they need to thrive in changing economic climates. Known for his community-centric approach to fintech, Brian’s here to share some insights into how the right payment systems can support business resilience and growth. Welcome to the show, Brian.
Brian Goudie: Thanks, Craig. Happy to be here today. Yeah.
Greg Kihlstrom: Looking forward to talking about this with you. Before we dive in though, why don’t we start with you telling us a little bit about yourself and your role at Aurora Payments.
Brian Goudie: Sure. I am Brian Goudie. I grew up in Massachusetts, found my way somehow into payments down in Charlotte, North Carolina, 30 or so years ago. with a company called First Data in a bank called Wachovia Bank. I spent about 21 years with First Data in all kinds of different positions there. And eventually in August of 2017, came on to what is Aurora Payments as the CEO of the company here. Aurora Payments is a fintech company that supports primarily small and medium-sized businesses. It’s not that we couldn’t do enterprise We have some really large clients as well, but our typical client is doing somewhere between $50,000 to $100,000 in revenue a month, and runs, again, all kinds of businesses out there you’d see in Main Street America today. So yeah, we support small to medium-sized businesses across the United States. We’re based in Las Vegas. I’m based in the Las Vegas office. We have an operation in Tempe, Arizona, not far from Arizona State. an office in Georgia and we have an office in Ho Chi Minh City in Vietnam that I’m sure we’ll talk more about why the heck we have a business in Ho Chi Minh City. It’ll come up. But yeah, been in it 30 years and the entire time in my career has been on what they call the acquiring side or the merchant side of the business as opposed to in our industry they talk about the issuing side which is often banking products. So related but my tenure has been more on the
Greg Kihlstrom: Got it. Got it. Great. All right. Well, yeah, let’s, uh, let’s dive in here. You’re definitely the right person to talk about this, this topic here. So we’re going to talk about a few things here, but I want to start with the role of payment systems and supporting those small and medium sized businesses and you know, anyone in any size organization, but you know, when talking about small and medium businesses, there’s been a lot of economic shifts over the last, I mean, ever, I guess. But over the last few years, there’s certainly been a lot of ups and downs and a lot of things going on from an economic standpoint. Those small and medium-sized businesses often feel the pinch in a different way than larger organizations during times of economic uncertainty. How can the right payment systems help them adapt and even thrive in some of these changing conditions?
Brian Goudie: Yeah, and you’re not wrong. I will say just for transparency here, while I’m the CEO at Aurora Payments, I also own two nail salons here in the Las Vegas area, which is something I never thought I would ever own, I can be honest with you. But my wife and I own a couple of nail salons. I’ve got a large family. I have eight brothers and sisters and many own restaurants and jewelry stores. So I’ve been around the SMB business in many ways, as well as being an owner myself and There’s no doubt, you know, the economic challenges that we see today that are ever growing. In payments, I would argue, you know, depending on the size of your business, obviously, like your employee, your payroll is probably one of your biggest bills you pay as a small business owner. And maybe your inventory, depending on the type of business you’re in. But I would put forth that your payment bill for many of these folks could be their third or fourth largest bill they pay every month. And I don’t know that everybody, would think that, you know, as a consumer, like, wow, it costs that much to accept payment. Yeah, you know, you could plug in 3% of all sales as a pretty good barometer of what a small, medium sized business might pay. So that $50,000 a month SMB that I mentioned earlier, that is our typical client, they’re paying $1,500 a month to accept payments.
Greg Kihlstrom: Yeah, that’s a lot out of that. Yeah.
Brian Goudie: Yeah, out of that settlement, right, there’s approximately $1,500. And obviously, the larger the client you are, you get better economics. Josh Hawley, recently Mascard Visa were on Capitol Hill and their Senator Josh Hawley was ripping into Mascard Visa pretty hard. I don’t know if you saw that.
Greg Kihlstrom: Yeah, yeah.
Brian Goudie: But, you know, part of his thing was like, oh, you know, I’m pretty sure that Walmart’s not paying what my SMB buddy over here from, I think it was Missouri or Kansas City. is paying and the reality is that of course not, right? Like the Walmarts of the world, the enterprise clients are going to pay less than your typical SMB. So it’s not one price fits all, but 3% is a pretty good barometer. What has changed or what we think about as we go forward, I think one of the biggest things I’ve seen, and this is particularly post-pandemic, is there was this phenomenon brewing in payments where merchants were able to basically pass the cost of the payment on to the consumer. So oftentimes, if you’re out there, whether it’s a restaurant or getting your hair cut or something, I’m sure most consumers have experienced a situation where the merchant said, if you’d like to pay by card, there’ll be a 3% surcharge, if you will, right? So the $100 pair of jeans you’re buying becomes 103 if you’re paying with card, and if it’s cash, it’s 100. You see a lot in gas stations. I think for most people, if you think about going to the gas station, It’s called dual pricing. You’ll see a credit and a cash price. Well, that’s the same thing that that phenomenon, if you will, has started to permeate across all kinds of sectors that probably I can tell you, you know, like my sister runs a restaurant, Charlotte. I don’t think she ever dreamt she would impose a cost to the client to pay with a card. But again, post pandemic, I remember having a conversation with her. She’s like, we’re trying to stay in business. Right now we’re trying to stay in business. And this is one of our biggest costs. That’s one way that you see SMBs today in a much more ubiquitous way. And I can never recall is passing on the cost of a transaction. I think your FinTech or your payments provider have to do more. If I go back to as recently as, I would say 10 or 12 years ago, not talking a long time ago, a decade or so ago, when somebody would go to their local bank or wherever they got payments from, generally they were getting a credit card terminal that would do payments. And that was probably about what it did for the most part. Maybe it did gift cards or something like that. But it wasn’t that dynamic. It was truly you were getting payments to do payments. That game has changed quite a bit in the last 10 years. You know, I was being a First Data guy. I mean, I was there when First Data brought on a product called Clover, which was about 10 years ago, 10, 11 years ago.
Greg Kihlstrom: Yeah, I remember that. Yeah.
Brian Goudie: I mean, it wasn’t that long ago, right? But Clover, the idea of Clover when We were actually initially distributing that back then was to have sort of an Apple phone like experience where A, it was simple to onboard and B, it would have this app store where you could buy all kinds of SMB type services that you might need. And that’s an example. It’s not the example. Certainly Square is another one that people are familiar with where, you know, it wasn’t just payments. There was a lot of things you could get working capital. Today, you can get a loan. or an advance against residuals, who would have thought your payments people were the ones that give you working capital for your business. So I do think like the fintechs can do a lot more today. And frankly, if I were an SMB, I would demand that. Yeah, it doesn’t do much for you.
Greg Kihlstrom: Well, so also, you know, so we’ve been talking about from the business side, but let’s talk a little bit about from the customer side as well, because, you know, the the POS, the POS technology, definitely, you know, there’s been a lot of advancements and things on the on the business side, but They’re almost becoming hubs of customer engagement and getting insights about customers. How do you look at, how should an SMB look at a POS technology to enhance operations, grow their business, reach their customers better? How should they be thinking about that?
Brian Goudie: It’s a great question. And you know, you started that with the consumer and frankly for the consumer, depending on where you shop, things may have become more irritable. you know, that dual pricing where the cost of the transaction is being passed on to the consumer. An SMB has a decision to make whether they’re going to do that or not. I mentioned restaurants, right? Restaurants, there’s a restaurant on every corner. So if you’re a restaurant, I think you really got to think about, am I going to impose 3%? Whereas, I don’t know, maybe if I’m a chiropractor, there might be a chiropractor every half mile or something. It’s not maybe as, that’s probably a terrible, example, but you know, I mean, like, yeah, nail salons, hair salons, restaurants, they’re, they have them every corner. So to do dual pricing or charge that consumer, you have a real decision to make, whereas a business where it’s less competitive. I know when I go to pay my kids college tuitions, if I pay with card, they surcharge me for that. So I don’t, I pay with ACH. But you know, you’re in a bit of a contained environment there, you got to pay the tuition, right? I think the other things for consumers that post pandemic is tips. I’ve never seen where so many businesses are asking you for a tip and often, like handing you a device and saying, Do you want to tip? There’s a bit of a guilt factor.
Greg Kihlstrom: Right, right. It’s no pressure there, right?
Brian Goudie: Yeah, I literally had one. I’ve got a couple interesting ones there. One, I got my smog test done and the smog test guy, I was there for like 90 seconds, you know, and he wanted a tip. And I had one recently where they literally the guy handed me the device was in a restaurant. And was that waiting for me to decide where I was going to tip, you know, so That I bet most consumers don’t love and we’ll see where that trend goes. But the other one, you know, you kind of were touching on is marketing. Everybody wants your phone number. Everybody wants your email. And sometimes that’s for good reasons. And I think this is a personal thing. You know, again, if you’re in a hair salon, let’s say you have a hairstylist that you really like. And I think most women, men, hair and nails and things like that, it’s extremely personal to them. And that’s an experience for them. So listen, if you get a discount from your favorite hair salon, you’re going to probably sign up, right? If you get, buy one, get one free, because you go to Jersey Mike’s and that’s your sub place or whatever, like you’re not, you’re not opposed to maybe having these, you know, what seem incessant marketing efforts, but the information at the point of the transaction definitely is, companies are looking to monetize that in all kinds of ways. I mentioned offers, right? But there’s other ways they’re looking to market to you based on buying habits and such. Aurora recently, we built our own payment platform, which just means that that front end transaction is actually going to Aurora. It’s not going to a third party. And due to that, we now have transactional data. So we might know like spending habits of people and things like that. All of that is really, really important. The consumer has a choice to make. Just like everything today, how exposed do you want to be? Are you going to embrace that or not? There isn’t a merchant that should mandate that. You shouldn’t be mandated to put in a phone number. But yeah, that is definitely a big change that I’ve seen in the last 10 years is the marketing aspect to merchants that are asking for all kinds of information.
Greg Kihlstrom: Yeah. Well, and so, you know, also, again, we’re talking about, we’re talking about small and medium businesses. And a lot of those are local. You’ve, you’ve mentioned a lot of what would be considered the local businesses, you know, whether it’s, you know, it’s in the corner of the strip mall, the whatever it is, these businesses are often the backbone of of communities and really driving, I mean, I think, I don’t know the exact statistic, but it’s like 999% of businesses are small businesses, right? So it’s like, it’s, it’s a, it’s a very large number. How does a company like Aurora tailor your solutions to, you know, address those, those unique needs? And, and, you know, what, what do you think the role of, of FinTech companies is in strengthening that, that local aspect?
Brian Goudie: Yeah, boy, there’s a lot of directions I can go here. And I would say the first thing we do at Aurora is try to be, it’s been called a horizontal platform. Odd term, I think investment bankers often talk about this or private equity firms like, oh, we’re looking for a horizontal payment platform. It just means to me, you have a lot of outs, right? You’re not all in on one bank sponsor or one processing company So for us, we have backend integrated into Fiserv and to Global TeSys. There’s another big change in this country in terms of payments and processing is 10 years ago, there was maybe six to 10 big processing companies. First data I think was the biggest at the time. You had companies like WorldPay and FIS and Vantiv and Global and TeSys. Fiserv, right? There’s been a ton of consolidation at the top. I mean, today, there’s like three huge processing entities in Worldpay, Global Thesis, Fiserv, First Data. There’s not as many big processing companies. So for us, building out a horizontal platform, number one, I don’t want to be single threaded into any one vendor partner. Number two, it’s what’s best for our SMBs, because anything now, you know, if you think about technology, they’re going to integrate. into a Fiserv or a Worldpay or a Teesys. Like if not, you really cut your ability to distribute off. And so if you think about technology integrating into those big processes for us, we can basically resell anything that we’re a global Teesys, Fiserv shop, as I said, it gives us a lot of optionality. In addition to that, we also, I mentioned, we built our own payment platform. We have our own hardware. In some cases, we own the vertical software as well. We are, I will give you the example of the nail industry actually is probably the best one. We own a software called Nailsoft and we bought that from an entrepreneur who was doing business with us a few years ago. I love what he was doing. He was trying to make the best nail salon scheduling software for the industry. He was a former nail salon owner. There’s a lot of scheduler based softwares out there for SMBs, but not, they don’t necessarily speak to nail salons. They may be more ubiquitous where anybody’s scheduler you can use. He really was trying to solve for the nail industry. And 80% of the nail industry in this country is Vietnamese culture. That’s their thing. Just like you hear dry cleaners, Korean driven, or you have other ethnicities that have really focused around a particular industry. With nail salons, the Vietnamese culture, when they came to the United States, they really focused on the nail industry. So there’s a cultural aspect. I said I would get back to why we have 70 or 90 employees in Ho Chi Minh City, it’s supporting and mail software that we eventually acquired. So in that case, one of the things we’re trying to do is vertically really become the best ecosystem for payments and really everything that keeps, in this case, a nail salon owner up at night, because we control the CRM, we control the payment platform, we control the hardware. So if we’re gonna go iterate any one of those things, maybe there’s something unique about payments that a nail salon or hair, lash, they’re almost a one-for-one for nail. If something a hair salon or a nail salon or a lash store wants, we decide we’re going to develop that. Most people doing acquiring, if you don’t own the payment platform and the hardware and the payments ecosystem, you can’t just go solve for everything that ails that payment owner. So we do a lot of voice of customer, listening to what keeps nail salons or hair salons up at night and figuring out, can we solve that? A great example in the nail industry is if you’re getting a pedicure and you’re sitting in a chair for 30 to 45 minutes, your hands are free, why not be able to tap out and pay? Or get a text link to pay while you’re sitting there? Why wait, right? That’s an example where the technology can make both the owner’s life better and also the consumer’s life better.
Greg Kihlstrom: Yeah. Um, so yeah, and I guess along those lines, I mean, definitely, you know, you, you’ve been, you’ve mentioned quite a few things as far as how payment systems are, you know, as, as features get added to things, the payment systems themselves become increasingly sophisticated, similar to, to the thing that you just mentioned. Okay. Let’s simplify the process of, you know, you’re sitting there, your hands are free. Why not pay? I’m sure that that increases kind of, you know, the, the ability to turn, customers over and stuff like that in a good way as well. How do you, in a, in a more general way, I guess, how do you ensure that the technology remains accessible and user-friendly for those SMBs while you keep kind of adding, adding features? Cause they also want more feed, you know, how, how do you look at that balance?
Brian Goudie: That is another phenomenal question. I know it feels like we rehearsed this, Greg, but the first time we met was 19 minutes ago. So that’s a great question. And by the way, it’s like something that keeps us up at night. the user interface. Some of these companies, I think Apple, I happen to be an Apple guy, phone users, I like Samsung too, but I happen to be an Apple guy, and I think Apple’s done a phenomenal job where you can go into an Apple store and buy a phone, and for most part, you can figure out 85% or 90% of what it is they have to offer. You might have to do a little bit of work and research on 10 to 20%, but they’ve solved for that, right? And what you said is 100%. spot on. We have this issue with the nail salon software. And some of this is like, you have engineers who are building it, right? An engineering mindset versus, say, a salesperson or an owner of a business can often be two different things. They probably are two different things, right? Engineers, extremely technical, probably the more complex with a great outcome. They love that kind of stuff, right? But you can’t build something that’s so complex that the consumer can’t use it, you’re done. Or the user interface itself, everything from the colors to how you onboard it. It has to be a seamless experience. I can tell you that right now with Nailsoft, we’re talking about our 2025 engineering prioritization. And one of the things we are talking about is how do we make the onboarding. If we’re going to lose a client, we generally will lose them in the first They can’t figure it out. They can’t embrace the new technology. It’s too complicated. And I’m very empathetic to that. Again, we run it, obviously, in our two stores. One of our stores has 18 Nailtec. So it’s not only the owners using it, the Nailtec’s using it, the consumer’s using the app. So there’s the consumer app, the Nailtec uses it for their appointments and their payroll, and then the owner’s using it. There’s a lot of points of failure there. So we are hyper-focused on, and I’m sure that Clover was like this. When we first released Clover in 2014, I’m not sure Clover was the right solution for everybody. And over time, Clover’s done a good job of augmenting their family of products. We have to do that. In the nail and hair industry, our beta, or not our beta, but our Bellwether product, Nail Soft, It could handle everything from two hairstylists to a shop with a hundred hair stylists or nail stylists, right, either way. The reality is the one that has two to four hairstylists, they may not want our Bellwether product because it is too much for them. So in that case, we have a handheld device that’s really built for the 1099 who might rent a hair salon station or a nail salon station. They don’t need the whole device. And again, Clover’s done the same thing and it’s really just You have to constantly be doing voice of customer constantly and knowing what it is that experience is all about for them from the time you sold that to the time they probably more importantly, if you lose a client, what was it that, you know, didn’t work well? Um, you don’t, it’s a, it’s a, it’s really the right question. Yes. And it’s true of everything, you know, um, how do you, and it’s, it’s funny cause you know, even with remote controls today, I know I’m the old remote controls are always like you had 10 remote controls. And today, sometimes I think the remote control things with smart TVs isn’t that simple either. Or I fly a lot and to get Wi-Fi on a plane, it’s like a 50-50 proposition today. That’s a terrible experience, by the way. You’re on a long flight and they tell you, you know, their Wi-Fi is down. These things are horrible experiences, but yeah, you got to get it right for something like that. You’re also in a referral game, right? If you make great software, you really won’t have to ever sell again as your brand becomes popular and people just go out and they’re actually self-selecting and then you’re consulting about the various services that it offers, but you only have to sell them. But the inverse of that is true too. If you’ve used that bad experiences in this world of social media, they’ll get on a Facebook group in a heartbeat, blow you up out of the water or an Instagram group and say, whatever it is. You know, this was my experience. Reputation experience is huge today.
Greg Kihlstrom: Yeah, absolutely. So as we, as we wrap up here, um, I guess, where do you see, you know, those, those small and medium businesses listening out there, you know, what do you see as some of the biggest opportunities for them to leverage FinTech to, to grow their businesses?
Brian Goudie: Yeah. I mean, there’s a few things I would say is don’t limit your constituencies opportunity to pay you, whether that’s mobile pay, you know, tap to pay American Express. If you go to places like New York City, there’s still places where they don’t want to take AmeriExpress. They think it’s too expensive, right? I think that stuff’s a little bit short sighted. You know, you should really try to embrace a payments company where you can accept all kinds of payments. I do think, you know, I’ve mentioned a lot of things where I see the payments and fintech ecosystem changing the most in the last 10 years. Another one is software leading the dance. You know, 15 years ago, I used to run the bank channel at First Data and we had 100 bank partners. So if you were, say, a Citibank client, that’s probably where somebody who was starting a business that had a banking relationship with Citi, the first place they would think to go is to their bank. that pendulum has shifted a little bit to the software company. So now if I go open a restaurant and I get restaurant software, there’s a decent chance that restaurant software is talking about integrated payment capability inside the software. And so what that’s done is created vertical, really payments ecosystems that are tied to whatever vertical software you’re in. And that can be a good thing. It can also be a bad thing, you know, over time, There’s a lot of leverage that these companies are going to have on you. There’s a pretty popular one. I won’t say who, because the reality is it doesn’t matter that it’s this particular one, but there’s a big one that just recently had a pretty significant price increase, right? Well, price increases with software companies and payment companies aren’t unusual, but I will tell you like when you get really embedded in an integrated software, be prepared because it’s going to be painful for you to leave that ecosystem. While it prevents so many benefits for you, as a SMB, I’d really look at the contract. Strongly look at what the contract is, what it says, what the capabilities are for the pricing components that change. Continue to look, there’s always advancements. You know, I think I call, you know, the Uber experience, but there’s, we all live in different verticals that we might shop in today. Amazon would be like this too, right? Like you’re, you’re basically putting your credentials in one time and that’s it. You don’t ever have to go back in there when you check out, it’s frictionless. That’s pretty cool stuff. Things where similar to that would be, I’ve been in stadiums recently where you just go in, grab stuff and walk out. Now that’s freaky the first time you do it. You expect security is going to.
Greg Kihlstrom: Right.
Brian Goudie: But these kinds of things that are emerging are really interesting. Self-checkout. This is another one that anybody who travels will know these gift shops and these airports. It was always, you know, you would go to a point of sale or checkout. Now they’re driving you to do the self-checkout. Grocery stores as well. I’m not even sure where I stand on that right now. I know in a grocery store, I don’t love it when I’ve got a basket full of things. In the airport, I do kind of like it because often it’s time sensitive, but there will continue to be these unique technologies out there. The SMBs, there is no one size fits all. You know, depending on how you operate, you really got to do the research, but I think there’s A, payments companies do a heck of a lot more. I mentioned working capital. That’s been pretty prevalent the last 10 to 15 years for businesses that can’t go to a bank. You can often leverage your sales in your business to get a working cash advance. There’s just a lot out there today that previously didn’t exist, but do your research. Again, there’s a lot of great vertical opportunities for you without defaulting to it. credit card device or a platform because you don’t know it like a square, then all admiration is square. But a lot of people will just default to square. They don’t know what their options are if they run a pet grooming store, let’s say. But there are pet grooming softwares, right? There are, you name your vertical, right? So there’s just a lot of more optionality out there. And I think it’ll continue. There’s been massive investment in payments and FinTech in the last 10 years. And I don’t see that slowing down anytime soon.
