When Cincinnati payment processing entrepreneur Ryan Rybolt helped launch Payload a year ago, he and his co-founder planned to embed payment processing into companies’ software.
But early this year, the leaders of Blue Ash-based Payload hit on an idea that has quickly paid off. An office of local real estate agency Keller Williams had talked to them about eliminating the physical check needed when consumers put down earnest money when they’re buying a home.
“We built something to help them eliminate those checks, and they quickly had significant adoption by their agents,” Rybolt, who’s Payload’s CEO and co-founder, told me. “When Covid hit we thought maybe there’s a broader market for this solution,”
It charges a real estate brokerage a nominal fee in the neighborhood of $20 a month to use the service. It also charges the home buyer $7 to $10 for the transaction.
Local real estate agencies such as Sibcy Cline, Comey & Shepherd and other Keller Williams offices signed up, Rybolt said.
“They all had the same experience with high adoption rates,” Rybolt said.
By spring, they realized there was a bigger market, and Payload’s Earnestly product was born.
Dotloop and Docusign have integrated the system into their platforms. It has quickly taken flight. Payload is already handling well more than 1,000 payments a month through Earnestly.
“Earnestly is by far the fastest-growing vertical we have through Payload,” Rybolt said.
It aims for that growth to take Earnestly to 10,000 payments a month by the end of the first quarter, Ian Halpern, Payload’s chief technology officer and co-founder, told me. The company expects to process payments at an annualized rate of 300,000 to 400,000 by the end of 2021. That would be about 5% of the U.S. real estate transactions and result in handling $1 billion in earnest money payments a year.
Payload sees potential in the 6 million real estate transactions that take place in the U.S. each year.
“Our goal is to capture the vast majority of those payments just when the earnest money is transferring from the prospective home buyer,” Rybolt said.
Users quickly found the product valuable. Sibcy Cline launched it during the coronavirus lockdown early this year.
“It gives our agents' clients the ability to seamlessly transfer earnest money payments without having our agents collect physical checks and take them to an office,” Drew McKenzie, vice president for innovation at Sibcy Cline, told me. “Earnestly's ease of use and their ability to integrate into our systems is what sets them apart.”
Sibcy has received positive feedback from clients and agents who have used Earnestly, McKenzie said.
But there are other related opportunities. Real estate companies want to use the system to pay agent commissions and agent fees.
Electronic notary services, which would replace the requirement for in-person notary signatures, could potentially be handled through Earnestly, too.
Down the road, it could be used for payments at closing, although state laws are restrictive and vary greatly regarding that now.
“The end goal is to play in that closing space,” Zach Jacob, Payload’s vice president of business development, told me. “There are pushes to change laws in certain areas. We plan to be on the forefront of it, and once it’s ready the closing table is going to be an interesting place to be.”
Beyond Earnestly, Payload is expanding the rest of its business. It has integrated the product with Microsoft Dynamics, NetSuite and about a dozen other platforms to enable companies to process electronic payments through their own e-commerce system.
Rybolt helped launch locally based Infintech in 2004 and was president for more than a decade. The company provides business-to-business payment processing and other payment services for companies. It merged with Nashville, Tenn.-based I3 Verticals in August 2015.
Halpern, Payload’s chief technology officer, co-founded RentShare in 2010. The company moved to Cincinnati from New York the following year to take part in the Brandery accelerator. It later returned to New York. Nashville-based I3 Verticals, the company that merged Infintech into its operations, also acquired RentShare.
