Links Related
to this Story:

• retrieveronline.com

Send an Email to:

• jnatoli@rpsionline.com

A Provider for All Seasons... and Systems

M any companies could not withstand the ravages of the ISO storm that swept the industry in the last decade, and few of the survivors maintained a stellar reputation. But the story of Retriever Payment Systems renews one's faith in the payment-processing industry.

It all started in Houston in 1986. A couple of guys had a dream, a typical ISO scenario for credit card processing - go out, get merchants and keep them happy. Their concept, however, was to differentiate through technology. They counted on achieving success by bringing different software applications to the payment-processing table. And they did just that.

"Most people believe that the tip-capture feature has been on receipts since the beginning of time," says Joe Natoli, Executive Vice President/Director of Retriever. "That's not the case. We were one of the first to come out with that feature. We were certainly a forerunner in the development of payment-processing technology."

In 1987, Retriever Payments welcomed a new CEO, Bill Higgins, who took the company to the next level. Within the first year under Higgins' leadership, Retriever's merchant base went from 100 to more than 1,000. In 1993, First National Bank of Omaha purchased the entire ownership of Retriever, and the company became a wholly owned subsidiary of FNBO.

Right after that, Higgins became President of Retriever and changed its philosophy from a heavy emphasis on writing software to one of sales and marketing.

"Bill felt our customer was the independent sales organization as well as the merchant;" says Natoli. "Our sales organizations became our primary customer."

That philosophy refocused the company's internal IT department and software writers, who starting developing systems to help ISOs bring aboard merchants more quickly and easily. They realized the more technology they drove down to the field, the easier it is for the ISOs to grow and manage their businesses. They left the software development to the equipment manufacturers.

While its competitors focused on the merchants, Retriever committed its offerings to the ISO community.

"If you want to know what a merchant wants or needs, the ISO can tell you," says Natoli. "No matter what technology you use, this is still a people business. If you lose the connectivity with the field, you'll lose the connectivity with merchants."

How did Retriever implement this noble approach? One of its most effective strategies was putting together an advisory board elected by ISOs that is still in existence today. The board meets quarterly and reviews Retriever's operations from a corporate standpoint. It gathers information from the sales organizations about what they need, current trends, and areas to focus on. It utilizes that information to help decide what products and services to offer.

Many ideas that originated in that boardroom have translated to effective programs and products, such as tender, gift and loyalty programs as well as a very organized agent bank program. Retriever Check is the conversion and guarantee offering that got its start from a board member. Another board member brought the concept of a government division to Retriever that works with federal, state and community offices that accept credit card payments.

For the most part, Retriever's target market is small to midsize merchants. It is a strong yet geographically diverse portfolio of merchants with an average sales base of $150,000. "We are able to deliver a level of service to the smaller merchant that is usually given to the larger merchants," says Natoli. "It has helped us to grow."

In 2000, Retriever boasted 70,000 merchants. That figure increased to more than 80,000 in 2001.

It would appear that Retriever doesn't feel the competition. Not so, according to Natoli.

"Of course we have competitors," he says. "It's tough for ISOs to compete in the merchant business. For anyone to say they don't have competitors, they're kidding themselves. I like to think we are our own competition in our agility to grow directly related to our getting our message out there - but someone is always chasing you."

It still comes down to people for Retriever, though it doesn't take everyone who knocks on its door. "We are not the processor for every ISO," says Natoli. "If you want to build a residual base and grow their business, we are here for you."

And are they ever. In one recent month, Retriever paid out $1.3 million in residuals. "When ISOs come to us, they say, 'Oh my gosh, I didn't know a place like this existed,' " says Natoli.

According to Natoli, one of the things ISOs find most appealing about Retriever is the fact that it has been around a long time with the same name and same basic philosophy of customer first. Retriever has a history of paying not only a lot of money out but always meeting its obligations for residuals to its ISOs. Retired ISOs still get a check, as do ISOs who have left the family to marry into another processor but have merchants still under the Retriever umbrella.

Retriever wants professionals who are in it for the long run, who focus on building a residual base.

"You have people who want to build a base but don't have the luxury of time, so their focus is on brand new start-up merchants or heavy emphasis on equipment," says Natoli. "They're not aware of what real residual stream means." Retriever is determined to show those ISOs the true meaning of revenue.

Retriever also claims to have one of the best leasing programs. When Retriever approves a merchant account, the lease is automatically guaranteed. There are no denials of leases on merchants who get approved.

And getting that nod is not too difficult. Depending on the size and type of merchant, Retriever has a volume-based program or fast-track approval. About 70-75% of all applications get same-day approval. It then goes to download mode, and ISOs are ready to load their merchants the following day.

The challenges Retriever faces are usually on auxiliary services. When the app is missing data or the volume is larger than the standard auto approve, it goes through a regular review process that normally takes at least 48 hours.

Because Retriever doesn't restrict the size of its merchants, it doesn't restrict the size of the ISO with whom it works. "Some of our oldest and finest organizations are husband-and-wife teams who work out of their home office or two guys or two gals as well as some organizations with 20 to 30 reps," says Natoli. "Our service department treats them all the same."

That service department provides quality customer support. With a long established, 24/7 in-house support center. Retriever provides a live voice at anytime to answer any questions from any customer, be it ISO or merchant.

However, Retriever has gone one step further for the customer: Each ISO is assigned a company rep. Merchant set-up teams are coordinated to ensure quality of service and merchant happiness. Once they join the Retriever team, ISOs are mandated to attend a three-day training seminar. While ISOs are responsible for their own airfare and hotel expenses, the training seminar is free, meals and materials included.

"If you are serious enough about joining an organization that cares about your future, you'll get here," says Natoli. "We do not send out a package, say sign here and go get your merchant. That's not us. We will never do that."

Retriever also has on-site training when the organization is big enough or multiple ISOs exist in the same area. After completion of the initial training, ISOs join a merchant set-up team led by a company rep who makes sure the new organization understands all the idiosyncrasies of getting its deals processed. The new group merchant set-up team goes for 90 days with ISOs assigned to one of two areas, either into a merchant set-up team designed to handle big ISOs or a team designed to work with smaller ISOs.

"We instituted this concept of set-up teams for ISOs about two years ago with similar ISO merchant business going to like set-up teams," says Natoli. "If you have the same people handling the same type of apps, you have more consistency in acceptance, approval and development of strong working relationships with your ISOs. We've created a great working relationship between the field and the corporate office."

Additional support comes from Retriever's Web site. The current site is being phased out, and Retriever's new Oracle project with new capabilities is being phased in.

"We've spent a considerable amount of resources to redesign the core of our systems," says Natoli. "We bought an Oracle database as well as all Oracle software apps to drive info out into the field to merchants."

The restructure will be in three phases over the next nine months. The first phase has been completed and is being parallel tested.

Retriever also has forged alliances with other major industry players. Front-end providers are NDC, Vital and Paymentech, giving ISOs yet another reason to sign up with Retriever.

"I don't know of many other processors that have multiple choices for their ISOs," says Natoli.

Enjoying a longstanding relationship with NDC, Retriever is rapidly growing a strong bond with Paymentech, which Natoli praises for its wonderfully bright employees and great software offerings. As for Vital, Retriever's new COO, Eric Turille, was a senior exec at Vital before joining the Retriever management team.

Retriever works with all the major manufacturers in supplying hardware. VeriFone, Hypercom, Lipman, Thales, Datacard and Citizen are all partners. In the bankcard arena, in addition to processing Visa and MasterCard, Retriever also has direct interface with American Express, Discover, Diners Carte Blanche and JCB.

First National Bank of Omaha is its sponsor bank though its position with FNBO has changed because of the leveraged buyout in December 2001. "First National Bank of Omaha was gracious to allow us to buy back majority interest in Retriever," says Natoli. "They still maintain a minority ownership."

Natoli lists a number of reasons for the buyout. FNBO and Retriever had different marketing strategies. While they enjoyed a great working relationship over the years, growing the merchant base 30% each year, competition started to grow between the two partners. Retriever officials believed that if their company became independent, it would be able to continue growth along a path they considered more comfortable.

"We went to the chairman of Omaha, and he was gracious to give us the opportunity to grow the business with their minority ownership," says Natoli. "We found it was challenging but exciting. Omaha is still a good member bank to process through and a good partner. It is the best of both worlds. We now can get an ownership position in the company and create opportunity for many of our VPs and managers to participate in an option plan that would give them more of a stake."

Where does Retriever go from here? "I think our future is great," says Natoli. "We have developed products prior to the curve like our check conversion product. You are going to see a lot of merchants moving toward that form of payment now that they can take a check, truncate and deposit it direct into their account like a credit card. Our internal staff is growing annually, and I see it continuing to do so. The economies of scale we will realize and the investment in technology we made will enable us to enjoy it." The company has 265 employees spread among four locations - its headquarters in Houston and regional offices in Massachusetts, Arkansas and Florida. At a time when the payment-processing industry is experienced unprecedented growth, Retriever is confident it can make the best solutions for ISOs very retrievable.

Retriever Payment Systems ISO contact: Joe Natoli, Executive Vice President/Director Phone: 800-376-3399 E-mail: jnatoli@rpsionline.com

Company address: 20405 State Highway 249, Suite 700 Houston, TX 77070 Phone: 800-376-3399 or 281-376-8899 Fax: 281-257-2937 Web site: www.retrieveronline.com

ISO benefits:  ISOs are primary customers.  Small merchants get treated like large merchants.  Will work with ISO of any size.  Paid out $1.3 million in residuals in one recent month.  Top-notch leasing program.  Has forged alliances with major industry players.  On-site training.