orking as an independent sales agent has pros and cons. Without sacrificing a lot of the freedom associated with working for yourself, wouldn't it be great to tap into a source for greater profit and residual potential and to be an integral part of a larger organization?

If that's what you're thinking, COCARD Marketing Group, LLC has an interesting proposition for you, and it's one that could make your dream job a reality. COCARD is a uniquely structured ISO, founded on the cooperative model with equity earned on a pro-rata basis. The company was formed because of the experiences its founders had throughout their careers when ISOs they represented were sold and promises of residual buyouts were broken. They were tired of making other people rich.

The concept of cooperative businesses, or co-ops, is nothing new. Natural foods stores, antique shops, nursery schools, medical groups, condominium and apartment buildings and outdoor gear outlets are just a few examples in which people buy in to be partners, members and part owners. Being part of a co-op usually requires a membership fee or initial investment.

As members of a co-op, individuals receive certain benefits: perhaps you have to be a member to shop at a particular store, get discounted prices on merchandise or camp at designated campgrounds. As shareholders, they also have a stake in the financial success of the venture.

COCARD's customers don't buy bulk foods or organic produce at this co-op. There are no jars of herbs and spices lining the aisles and worn floors.

Instead, COCARD is the first organization in the merchant account processing industry (with a business plan that has a patent pending) offering opportunities for maximizing revenue-and for true ownership of residuals and of the company itself.

For independent agents, this concept opens a whole new realm of possibilities for the way they work and earn money. Unlike standard co-ops, members/owners earn profits on their initial investments based on a pro-rata percentage basis and benefit from the merchant accounts they all bring in each month.

COCARD is a registered ISO/MSP with National Processing Co. (NPC), owned by a group of small to medium sales offices around the country. The intention is to bring the agents together to leverage their talents and abilities to achieve maximum return on investment. As part of a larger group, they can then take advantage of better deals on processing costs and equipment prices than they would be able to get on their own.

"We're not a typical ISO office," said Rob Washington, Vice President and one of the company's original founders. "Fundamentally, we're structured differently. Each office is an owner; there are no sub-ISO's. A nominal investment gives the little guys the opportunity to have ownership. We're also able to negotiate the best deals on behalf of our members for increased buying power with processors and leasing companies."

Rick Pylant is President and one of COCARD's founding members. He had nearly 20 years of experience in banking operations and merchant processing when he decided he had his fill of larger companies reaping the rewards based upon his efforts and those of other producing agents, when their portfolios were sold for large multiples.

"I finally decided to start my own ISO," Pylant said. "I found the premise of COCARD, which was to take small offices and band them together, to be very intriguing. Lots of small offices would then own the larger ISO.

"The smaller offices get terrible pricing. Now, as co-owners processing through COCARD, we effectively have become our own wholesalers. We can now leverage the total production of our organization into lower costs across the board to the benefit of each of our members."

Almost four years ago, in early 2000, a small group of industry veterans, including Pylant and Washington, decided to get serious. Between them, they had a combined experience of 45 years; now, their goal was to create something totally different from the standard processor-sales agent relationship.

"The agents that do even as much as 50 to 150 deals a month are the ones doing all of the work, but they're not even a blip on the radar screen," said Washington. "They're just not big enough." By joining forces and portfolios they can achieve revenue levels that up to now have been reserved for only the "big players." The blip becomes a noticeable object that must be reckoned with.

The founders brought together a small group of initial members who invested their funds along with them; that seed money covered the start-up costs, including legal fees and the cost of securing the initial ISO contract with NPC. "The lawyers put our brains on paper and came up with an iron clad, bulletproof plan for investment," Washington said.

COCARD is a Securities and Exchange Commission (SEC) regulated investment so its financial statements are subject to audits. Washington and Pylant said that when their portfolios are acquired, the co-op's owners have the potential to earn a return of multiples that are significantly greater than they would ever be able to earn on their own.

COCARD is actively recruiting new owner/sales offices, as well as affiliates and sales representatives who can contribute to the company's significant rate of growth. Their goal is to make COCARD too good of a deal for an acquirer to pass up somewhere down the road.

"The smaller offices add to the overall volume of the entire company," Pylant said. "We're doing a lot of volume; it looks like we're one of the biggest ISO's out there."

"It sounds kind of funny to start a company with the intention of selling it, but that is precisely the point of investing in the COCARD model," Washington said. "The acquisition mode is alive and well. Acquisitions have been increasing the past six months-look at iPayment, Verus and even Intuit's recent purchase of IMS.

"We've structured our entire platform to be particularly appealing to potential acquirers. COCARD will be a very attractive target for acquisition," he said. "Additionally, since we are both the owners and the sales offices, we can provide solid commitments to the purchaser for continued and increased production in the post-sale environment. This is something that has been lacking in most of the prior acquisitions that have occurred."

COCARD's offices are individually owned by its members, so there is no overhead to support. The virtual nature of the company means that by buying COCARD, the acquirer will purchase pure profit-not furniture, fixtures, equipment or other infrastructure that they would subsequently dismantle.

"By working with COCARD, agents' incomes increase right off the bat without waiting for the investment returns," Washington said. "The average agent doing 19 deals a month has little negotiating room and has to take the deals that are offered by the processors. We have been able to pre-negotiate contracts with processors and vendors that increase the agent's profitability on every aspect of their business.

"There are multiple income sources possible with every deal through COCARD, beyond mids, nons, buy rates, AmEx, Discover or residuals that people just don't know to ask about. Just by joining our team they can increase their residual income significantly."

COCARD has a range of services and products for its members and affiliates to offer to their merchants including processing, equipment, value-added products and services such as gift and loyalty cards and marketing programs for print and the Internet.

COCARD recently added its thirty-eighth owner-operated distribution channel. At the end of the third quarter of 2003, they had more than 9,000 merchant relationships in place with a combined annual processing volume in excess of $750 million. At COCARD's present rate of growth, they expect to surpass the $1 billion mark in annual sales volume soon. COCARD recently launched a recruitment program for individuals who don't wish to invest in its model. Affiliate sales people will have the same processing opportunities and purchasing power offered to members, but they will have no equity in the company. They'll still end up getting a better deal when COCARD is purchased, Pylant said.

COCARD's management style also reflects the premise that as co-owners, the sales offices have equal status. Pylant said a board of non-salaried managers are elected to analyze and execute strategic decisions. Malcolm Carnahan, COCARD's Executive Vice President and Treasurer, is the only paid full-time employee on staff. He and an administrative assistant work out of an office in Hendersonville, Tenn.

In the spirit of cooperation, by identifying two things the payment industry has way too much of-ego and greed-and one thing it could use a lot more of-integrity-COCARD's founding partners solidified their resolve to run their company differently.

"In this business, everyone wants to be the boss," Pylant said. "We had to check our egos at the door to make COCARD a reality."