Results Improve for Paysafe As the Processor Looks to Beef up Its Internal Sales Staff

Paysafe Ltd. wants to do more to sign merchants directly, and to that end it’s hiring salespeople—lots of them. The London-based merchant processor, which has a big operation in North America and aspirations for a larger one, hired 55 salespeople in the first quarter and plans to add 170 in total this year, according to chief executive Bruce Lowthers. “We’ll double the sales team head count this year,” he said late Monday during a call with equity analysts to discuss Paysafe’s first-quarter results.

The idea is more sales, but also more profitable sales, he said. Paysafe, like many processors, relies on independent sales organizations to sign a chunk of new business, but now, Lowthers said, the company is shifting over time to direct sales. “Our objective is a [merchant] mix less influenced by a lower-margin third-party channel,” said Lowthers, who added Paysafe has worked to expand its product offerings for merchants and shorten its time to board new sellers.

The effort may be starting to pay off in an area of the business where merchant growth had leveled off. “We’re starting to see a return to growth in that [merchant] book,” Lowthers told analysts on the call. “We feel that will continue. We’re putting a lot of salespeople in that area. We feel good about our ability to compete and win.”

That doesn’t mean Paysafe is abandoning ISOs and independent software vendors (ISVs).  But it does mean it will depend on them less, instead relying on its internal salesforce and “referral partners” like Dun & Bradstreet Corp., a business-analytics company. “You’ll see us continue to look for those kinds of relationships,” said Lowthers. His optimism is based on what he called “a nice pipeline in larger deals”—those of $1 million or more in potential annual sales. “The pipeline is the strongest it’s been since I’ve been here,” said Lowthers, a former FIS Inc. executive who took over as CEO in May 2022.

To help woo merchants, Paysafe will launch a merchant wallet this year that will let sellers consolidate facts and data about their sales, Lowthers said. “Merchants seem to like that idea,” he said, “and the app looks really strong. Merchants are excited about managing their business through that wallet.”

But it’s on the consumer side of Paysafe’s business where wallets have long been in evidence, particularly in the gaming industry.  Here, the company reports it signed 1.4 million wallet users in the first quarter, helping to bring its active user count to 7.5 million. Its wallet brands include Skrill, Neteller, PagoEfectivo, and Paysafecard.

Growth in this business has been helped by Paysafe’s move into legal gambling markets in more than 30 states, with sports betting a prominent feature. Overall, digital wallets contributed $5.7 billion in transaction volume in the quarter, up 4% from the same period last year. Now Paysafe is looking for continued growth with deals such as its recently signed alliance with Xsolla, a provider of commerce tools for videogames. Paysafe is clearly looking for big returns from this deal. “They could be a top 100 customer for us,” Lowthers said.

For the March quarter, Paysafe recorded $36.1 billion in volume, up 6.8% from the same quarter in 2023. Revenue climbed 7.7% to $417.7 million, while net income swung from a $3.8 million loss last year to a positive $3.06 million.