As I am anticipating the launch of the 2.0 version of Enable Leaders, I have been working my way through the challenge of finding the right payment solution for my company for our work with talent and leadership development professionals. I wanted to share my experience in case there are others looking to build a SaaS/membership solution on a global scale.

My context: I want a solution that will allow me to take payments, as well as to have tax compliance automated on a global perspective.

Tax compliance can be messy, especially for those of us that do not have that expertise. I read that the US alone has some 11k tax jurisdictions: that’s significant.

So, for myself, I came down to two different things:

  1. A merchant of record.
  2. A processor plus some kind of tax solution.

When it comes to a Merchant of Record (“A Merchant of Record is the term to describe a legal entity that handles all payments. In addition, it takes on the liability related to every transaction to an end customer, be it the selling of goods or a service. It arranges all due tax payments, ensures PCI compliance and takes care of any refunds and chargebacks.” Source: GoCardless), there are a litany of options out there.

Paddle, FastSpring, 2checkout’s 2Monetize platform, Paypro Global (a bootstrapped, lesser known company), Lemon Squeezy , Reach and more. G2 doesn’t have the MOR category well defined (some of them aren’t truly a MOR). The question of “do you need a MOR?” is a valid one (Outseta does a great job exploring this question), and that will depend on your business. Reddit can be a great source of information to explore if you’re early in looking at this, too.

When it comes the latter category, it’s key to keep in mind: where are you doing business? The processor may have restrictions (and options) for you, and depending on your business model, you can begin to deploy embedded finance options: payments don’t need to be a cost center, but they can drive both revenues AND valuation.

Some of the tax solutions I found in my travels included: Zamp (US only right now, but expanding), Kintsugi, Avalara, Anrok (and an array of competitors) and others. Key to looking at these would be to understand what you need and how far that solution needs to go/should go: do you want to sell and “set it and forget it”, or, do you have accounting internal/external that can help you? Where can you save on needless costs? For me, I heard “why not Stripe tax?” a whole bunch: for me, it didn’t do the full journey of what I want in terms of tax compliance, and that’s not the right fit for me at this point.

For now, I’m getting closer to finding a solution: when you do your due diligence, make sure you understand the implications. MORs have drawbacks , but so do other solutions, especially in terms of technology requirements, deployment, staff/expertise needed, etc.

My suggestion? Lay out your own criteria: I need a solution that will do the following ____________, _____________, ______________, etc. Then, as you learn, modify the criteria (as appropriate, but don’t be swayed). When you pick the solution, ideally find something that isn’t painful for switching (ask that question) if you have to change vendors. As with anything, some people will have positive experiences, some will have negative: just consider how you can best communicate what you need to towards your customers (as appropriate), and be clear to ensure positive customer experience.

If you’re looking for help with PAYMENTS, feel free to contact me: I know a couple of payment experts that I can refer you to who have leading global expertise on the payments side. 

Good luck out there!

Photo by Kelly Sikkema on Unsplash