2359 - A Deep Dive into Merchant Services with JELA Payments' Jimmy Estrada

0:03Jimmy Estrada:Welcome to the Thoughtful Entrepreneur. If you're committed to growing your business by serving audiences with generosity and real expertise, you're in the right place. This is a daily 15 minute show featuring leaders who believe real impact comes from generosity, not hype, which means as a listener, you're going to get the good stuff. In fact, we created podverified.com to give thoughtful leaders like you free tools to show up better on podcast stages, like this one. That includes your free PodVerified score, free PodVerified guest training, a free media kit builder, and so much more. It's the first ecosystem of its kind built by podcasters who genuinely want to help guests thrive and grow in podcasting.

0:46Jimmy Estrada:Visit podverify.com if you'd like to be featured as a future guest. I'm Josh Elledge. Let's get into it. with us right now it's jimmy estrada jimmy you are the founder co-founder and ceo of jayla payments you're on the web at jayla payments.com we're going to talk about your superpowers and what you've done and your longevity in this space over 13 years we'll get to that in a moment uh jimmy it's great to have you thank you so much i appreciate it thank you so much yeah thanks for showing up in such cool studio and stuff too uh absolutely cool for those uh who might be seeing clips or, you know, seeing this online, you certainly, I think you'll appreciate the extra production that you put into this.

1:32Jimmy Estrada:But Jimmy, before we get started talking about J-Law, you always love hearing what, you know, high-level leaders are kind of into on the outside, you know, maybe geeking out or having fun with when they're not at work. What have you been geeking out on lately?

1:45Josh Elledge:Oh, man. You know, I love playing the piano. I'm not super good at it or anything, but I think I'm pretty, I could surprise people a little bit, right? I love playing the piano, something that I truly enjoy. I like just hearing new tunes on the radio and try to challenge myself to, you know, to play them by ear, something I've been doing since sixth grade. Don't know how to read notes or anything, but I love the piano. Just love the piano and love the new pop songs that are out there. Sometimes they're trying to match those chords and whatnot. So I love that. And I also love spending time with my girls.

2:14Josh Elledge:I mean, I got some preteens and a teen, So it's kind of difficult to drag them outside to spend time with me outdoors sometimes. But I do enjoy hanging out with them in the beautiful state of Florida.

2:26Jimmy Estrada:You know, you're in a great place. You're in Tampa, just down the road from me. And I agree, as a dad of a daughter who is now 26 years old, I'll just tell you this, and I'm sure you've heard this. You know, I really prioritized, you know, and made sure that she and I, you know, we went to go see comedy together. We'd go see plays together. You know, I'd always try to take an interest in what she was into and, you know, just, you know, prioritize that daddy daughter time.

2:53Josh Elledge:And I'll just say, you know, now as an adult woman, you know, she she often thanks me, you know, for even when she did not want to, you know, I'd kind of keep inviting, you know, keep inviting her.

3:05Jimmy Estrada:And and I'm so grateful that we made those memories together. So I just say one dad to another.

3:10Josh Elledge:Thank you so much. Thank you so much. I get excited when my daughters tell me, hey, can we go for a drive? Like, heck yeah, you know, so thank you for sharing that. Awesome.

3:18Jimmy Estrada:Yeah, yeah, for sure. And agreed on creating music. I finally a couple of years ago picked up a bass guitar and it is one of those hobbies, you know, and again, to my other friends and leaders out there that, you know, if you need an outlet where there is no limit to where you can go with that hobby and that creative outlet, you just even if you're, you know, even if you're in your 50s or 60s or whatever, it doesn't matter. Like you can pick it up and you will be amazed at how quickly you can get competent at an instrument. And it is such a joy, you know, two years now I can play well over a hundred different songs and it's just,

3:58Josh Elledge:yeah, it's so fun. Were you taking classes or just YouTube?

4:01Jimmy Estrada:I bought it. I bought an e-course beginner to badass on the base. And that was good for maybe just the fundamentals, really just the, you know, know just a lot of the 101 type stuff but quite honestly you know what i do is i just i just played along with youtube videos you know they put the they put the tabs on the screen and then i started moving to another program where it's just i'm basically just doing guitar hero that's all i'm doing to get you a rock band that's all i do is i just i just kind of basically play along with the backing track and just watch the notes and and now it's it's just like playing guitar hero if you remember back in the day yeah i do yeah yeah well jimmy tell us about jayla payments oh we've been

4:40Josh Elledge:around for 13 years. We're based here in Tampa. We used to be based in Dallas. And basically, we focus on not only saving companies and businesses money, we just go there and educate them on how to take payments securely, compliant, and with all this up-to-date technology, just getting them set up correctly.

4:57Jimmy Estrada:Okay. So I guess now I need to understand, you know, who is it that you work with? And do you then, like, so, you know, for example, like we use Stripe, you know, a lot of folks will use Stripe or something like that. Do you, would you be a replacement for Stripe or do you sit alongside?

5:14Josh Elledge:Help me understand that word. That's a great question. Somebody was just asking me that right before we got on. He was asking me, what about Stripe? Stripe would be like a competitor. So I think Stripe does amazing on what they do. I think Stripe is very, very good. Unfortunately, I think often that face-to-face, that person you could talk to, that person you could text or call, not just email, it's really what separates us. So often we actually could work as a Stripe, if you will, where the payment processors, whether it's e-commerce, whether it's face-to-face, whether it's card not present, that's where we come in play.

5:43Josh Elledge:And we're also able to educate the small business owners and even the enterprises on what would be the best thing for them financially. Do you pass the fee to the customers? Do you not? What are the benefits? What are some pros and cons? So we don't just set them up or assign an application. We really get to become part of their team and want to keep their culture in place throughout the whole time.

6:04Jimmy Estrada:Yeah. No, it's absolutely true. I think, you know, our biggest complaint with using Stripe is, you know, the support is not very personal.

6:12Josh Elledge:It's, you know, very transactional.

6:15Jimmy Estrada:It's usually kind of hard. Like if you have an issue, you know, it's kind of hard to work with them. What would be some examples, Jimmy, where that level of support and or personal connection would be very important to have? And if you think about, you know, everything that a small business owner, a medium-sized business owner would deal with. And I know that you don't just work with SMBs. You also work with some really large, you know, kind of multi-location retailers and so forth. What would be some examples where like, yeah, let me give you some examples of like how beneficial this would be to be able to work with humans on this side of things?

6:55Josh Elledge:You know, I always use the example of the post office, FedEx and UPS. At the end of the day, you know, I could go to the post office. I could ship things out. I usually pay a little extra for the service I'm going to get with something like FedEx or UPS. So I do pay a little extra for them. What we try to do is give them that first class experience with the economy prices, if you will. I had a customer who reached out to us because Stripe had actually held, I think,$40 ,000. It had been two weeks. They had sent an email, what's going on? Why haven't I got my money? They weren't getting the responses they needed.

7:28Josh Elledge:And for us, I'm not saying that money won't be held. It all depends, right? Risk, underwriting, I mean, all those things do matter, but we're reaching out or our customers are reaching out to us and we're responding within 24 hours. Often it's not just by email. Email is easy for a lot of us. But imagine if$40 ,000 is being held, you're not wanting to email. You're wanting to pick a phone and talk to somebody. And that's what we do. So all our accounts have personal account managers that they could actually speak to. They could actually text and they could email, of course. So that's that's one of the stories I would give.

8:00Josh Elledge:but it's been happening often where certain verticals, certain industries, I'll use healthcare, for example, online healthcare has a, they could sign up with something like Stripe and it could be where two, three months later, money's being held because they have questions about the business because the business is considered a high risk. But if you don't explain that to the customer, they're just having their money held cashflow that that becomes a problem. So we come educate them and say, Hey, if you're going to run a$40 ,000 transaction, and that's not what you're constantly doing. We need to communicate.

8:31Josh Elledge:You need to let us know. And they're like, oh, if somebody would have told me that, yeah, I'm game. So that's what we do. We want to educate them, letting them know that, hey, you got to communicate that with us so we can make sure that we're getting the invoices and everything beforehand and your money still going back into your account the next day.

8:48Jimmy Estrada:So now, Jayla Payments, you're not the payment processor yourself, right? So you're working with, and correct me if I'm wrong, but you have partners like Authorize.net and Carpoint and other partners that Clover and some that you're working with. Can you explain how that works?

9:05Josh Elledge:That's correct. Great question. It can be confusing for a lot of people, but at the end of the day, merchant services, there's a handful of great companies out there in the United States, for example. We only work right now primarily in the United States. We are looking to go into Canada and to Mexico. But currently right now, a company by the name of Pfizer, for example, F-I-S-E-R-V, companies like Tesis. These are huge companies out there that we have actually partnered up with, and we are the customer support. We are the ones who are providing the education. We are the ones that if you're having a chargeback, you have a question about your funding, if you're not getting your report the correct way, we're the ones that actually facilitate that.

9:41Josh Elledge:So we are the merchant services that provides that. So we partner up, as you mentioned, whether it's a Clover, maybe not everybody needs a Clover. Maybe you're in e-commerce and you say, hey, I currently have Stripe, but I I got my money being held. What options do you have? And you mentioned authorized on it. It's one of the biggest ones out there that we could actually integrate with, but there are many, many solutions out there. So we're the merchant services provider that makes sure that a, you're not on a contract. We're able to do that. So make sure you have transparent pricing and then make sure you have the up-to-date technology that's needed, whether it's online, in-person, sending a link or whatnot.

10:16Josh Elledge:I hope that makes sense. Yeah.

10:18Jimmy Estrada:And, and I think, you know, I think the reason that a lot of maybe online retailers, like if they're operating on a platform, they look at, well, what are the native integrations that are just kind of plug and play? And so then, okay, well, Stripe is the easiest to integrate with. But maybe one objection might be, well, wait a minute. Is this going to disrupt the user experience for my customers? Or how easy is it to integrate with a different platform?

10:47Josh Elledge:That's a great question. there's a lot of softwares out there. We call them ISV partners. So we currently have somebody who's working on a nonprofit organization. I can't say the name because she's still working on this, but basically she could integrate with Stripe, but she didn't realize that we also have an API that we could just turn on and just plug in correctly for her. So the customer experience we have available, often what it is, is a lack of knowledge. Most people don't know that they think Stripe's the only one. And once again, they're great at what they do, but we also have our API and others, even our competitors.

11:16Josh Elledge:There's APIs that can actually connect to these softwares and these platforms that would allow you to continue offering great service to your customer on their end. But imagine now the pricing either being better, transparent, and having that personal one. One thing I wanted to mention, we have somebody right now who we are actually the arm, the legs, if you will, of the merchant services. So our email doesn't show our name, it actually shows their company name, merchant service at their domain.com. So anytime any of their customers have questions and it's in that email, it comes to us, their customer says, oh, that's all part of the same team.

11:50Josh Elledge:So they keep all of that still with their logo, their name, but with the full support and backing that we could provide. Yeah.

11:59Jimmy Estrada:Jimmy, are there, so regarding fees, How did the fees usually work out? And are there any clear examples where, you know, in addition to maybe the additional layer of support they get, where there might be a break even like, yeah, we're going to beat the pants off of, you know, maybe your old payment processor?

12:21Josh Elledge:I always tell people that when it comes to like Visa, Discover, American Express, you know, the car brands, MasterCard, they have their set fees. That doesn't change. It's actually public. You could go on there and find out what their cost is. What merchant service companies usually do is they come and they, what we call the upcharge, right? Because we're the ones that are providing the next day funding. We're the ones that are providing the chargeback support. We're the ones providing, you know, underwriting risk, the onboarding. So Visa, MasterCard, all these card brands that we just mentioned, they have their costs and that doesn't change.

12:51Josh Elledge:However, I will say this, every year we've noticed that usually in April and October, the fees just go up. The cost just goes up. So a lot of times merchants are not familiar with why is my pricing going up? It could be that the merchant service company they have is just hiking it up, or it could just be that the cost has gone up. So right now there's different models out there without boring the public here. The models out there is basically, I as a merchant, I pay the fee, but how much more and how much will I have to pay? That's number one. We call that interchange, interchange plus. The second model is what we call compliant surcharge.

13:25Josh Elledge:You can't do this in all the states. There's a few states that you can't do it. I won't mention all the states now just because that could change. But there are certain states that you cannot do compliant surcharge. And all that means is if I go to pay for something, I actually could pay, as a customer, could pay a 3 % surcharge if I use my credit card, those reward cards, those points that we want. But if I pull out my debit card, I don't pay that surcharge. And now the merchant only pays a fee on debit cards, which is much lower. So there's a huge savings there. And then right now, I'm sure you've seen this with gas stations.

13:56Josh Elledge:You see two prices. You see the card price, the cash price. You pull over thinking that's the card price, but that's the cash price. So there's dual pricing, where in reality, you have two prices. You have the price for the cash, and you have a price for the card. And that usually eliminates almost 100 % for the merchant services for the merchant. But all this stuff really comes down to sitting down with a merchant, understanding their needs, and explaining that to them. Because people will go out there and say, oh, I could save you 80%, 90%. But who's paying the fee is a question. How do you do that by not making your customers upset as a merchant?

14:29Josh Elledge:So we're looking at every angle, not just making money and saving money. We want to also look at the customer's experience.

14:35Jimmy Estrada:What are some types of business owners or leaders that they should be grabbing a call with you ASAP because you know that there's definitely some quality service or cost savings that you could likely work? So maybe like industries or specific types of folks that you've worked with that you just knock it out of the park with?

14:53Josh Elledge:I would say currently we work with a lot of business to business, a lot of dealerships, attorney offices, medical clinics, steel companies. These are people who may not actually have somebody who's saying, hey, let me see your merchant statement and let me just do a free analysis because they got nothing to lose. Imagine I say, hey, let me see what you got. Let me let me run through these numbers and then present it to you and say, hey, this is what you're looking at, what you could be saving. Sometimes we'll find junk fees. And I'll tell customers, you don't have to come with us. We would love to have your business, but you're still doing something what's good for your business.

15:27Josh Elledge:And we're building a relationship where you're able to say, wow, I could save this. And if you have a really good merchant service company, I say this all the time. I'm okay saying, go back to them and saying, hey, can you match this? Because if they're a really good company and they have a good relationship and they've been servicing you five, six, seven, eight years, I understand what you would want to stay with them. The problem is these companies who every year they're switching merchant service company thinking that things are going to change when in reality it may not until you have a solid relationship with someone who's actually invested in the business as well as you were.