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This article appears in the Sept. 17, 2009, edition of ISO&Agent Weekly.
As co-owners of North American Business Solutions LLC, a Binghamton, N.Y.-based merchant-services company, Mark Sodon and Christopher DeWolfe have ambition to one day to compete against First Data Corp. and Heartland Payment Systems Inc. They just wish they had started sooner.
Sodon began selling merchant services in 2006 and DeWolfe in 2007 with Melville, N.Y.-based Federated Payment Systems LLC. They started North American Business Solutions in June 2008. Sodon, 26, is CEO and DeWolfe, 28, is president. The two only sold merchant accounts through Federated before starting their own merchant-services company.
Besides selling merchant-processing services, Sodon also helped recruit and train sales agents, he says. DeWolfe, too, sold merchant accounts. The two met while selling for Federated.
"After almost a full year as a merchant-level salesperson, Mark and myself began discussing what would be needed to open our own 'Federated,'" DeWolfe tells ISO&Agent Weekly. North American Business Solutions is not an ISO, but its merchant contracts are written through Federated, Sodon says. In effect, Sodon's and DeWolfe's firm is a sub-ISO.
The two entrepreneurs spent about six weeks researching the elements of starting a business.
They turned to a couple of executives at Federated, Jon Levitt, CEO, and John Guirguis, president, for business advice.
Starting a business involves more than knowing the products and services it sells, Sodon says. "Jon and John at Federated offered their services and put us in touch with some credible companies" for such needs as insurance and accounting, he says.
"We had to [learn], and are still learning, about taxes, labor rules, etc.," Sodon says.
The duo scouted office locations, wrote recruiting ads and built a supply list. Sodon estimates that in the first month he and DeWolfe spent more than 16 hours a day each week working on the startup.
North American Business Solutions has 35 staff employees and 35 independent sales agents, Sodon says.
Structurally, the enterprise has marketing, inside sales, outside sales, application processing and management departments. One person handles activations to help sales agents with terminal and software installations at merchant locations.
The two Federated executives also are valuable for sharing their insights about the inner workings of operating a merchant-services company, Sodon says. "In a way, we didn't decide to form our own enterprise. We were groomed to do so," referring to the mentoring Levitt and Guirguis provided.
It likely helped, too, that the direct-sales experience for Sodon and DeWolfe included several years working outside the payments industry. Sodon has been a salesperson since 2002, and DeWolfe has worked in direct sales since 2004.
Levitt's and Guirguis's guidance is especially vital given that Sodon and DeWolfe have about eight years of experience and the Federated executives have been there for four of those years, Sodon says.
The preparation Sodon and DeWolfe put in appears to have paid off.
They wanted to open 1,000 merchant accounts one year after starting, and they surpassed that goal with 1,584 accounts one year later.
Currently, North American Business Solutions intends to hire 10 more employees to support more sales agents. By the end of 2009, the merchant-services company wants to see 400 merchant applications a month and eventually reach 1,000 applications by mid-2011, Sodon says.
