A Jacksonville fund has teamed up with one of the most storied venture capital firms in the country for an investment in a company that could reshape the way money moves across the world.
Jacksonville-based PS27 Ventures is part of a $10 million seed funding round raised by Payall, a Miami-based startup whose software simplifies cross-border payments. The round is led by Andreessen Horowitz — the fund whose investments include Airbnb, GitHub, Facebook and Twitter — which contributed $8 million.
PS27 and some other investors contributed the remaining $2 million.
“The wonderful thing about this is we’re not only connected to a great founder and entrepreneur and what we believe is going to be a unicorn,” PS27 CEO Jim Stallings said, “but we also have our local investor here in Jacksonville that are our limited partners that are now in a substantial deal.”
Payall is the creation of Gary Palmer, a serial entrepreneur who has a long history in the payment processing industry, including being a pioneer in the prepaid card sector.
He also has a connection to Jacksonville: In 2007, Jacksonville-based FIS Inc. bought a company called eFunds, where Palmer was executive vice president of global strategic business development, after that company had bought WildCard Systems, the prepaid card processor Palmer had co-founded.
Palmer then worked at the Fortune 500 company for about a year, heading up FIS’ prepaid business and other areas until April 2008.
His new company is designed to simplify the process of sending money across borders. Right now, Palmer said in a conversation with the Business Journal, such payments require a massive amount of hands-on work, with back office bank employees having to handle an array of regulatory approvals and manual inputs.
The Payall system looks to cut out a lot of that manual process and do a better job capturing the data that goes along with the transitions, making sure things like required documentation are automatically captured.
“Our system is automating every part of that process — sharing the appropriate data that’s required to ensure the integrity of the transaction and then automating the payment orchestration along the way,” he said. “At the core, that’s what we’re doing.”
That could simplify — and make cheaper — everything from larger transactions to foreign sales from creators on sites like Etsy, he said, letting recipients, including unbanked persons, receive their quickly in an array of payment channels, including mobile money, prepaid cards or bank accounts.
“The process of getting the money from one person’s account to another account in another country is slow, expensive and frustrating,” Palmer said. “I thought I was going to retire, then I said, I need one more thing to do: I’m going to fix the cross-boarder payment business.”
The need is particularly acute now, as remote work and international trade makes cross-border payments more common.
While the technology is disruptive, Palmer said, it’s not looking to compete with banks; instead, Payall will sit inside banking system.
Building out the Payall infrastructure will be expensive, which is where the funding from Andreessen Horowitz, PS27, Motivate VC, Bridgeport Partners and other investors comes into play.
“We are putting all of the money to accelerate our product platform,” Palmer said. “I mean, we've got a great platform, but we are accelerating some of our roadmap and getting more stuff to market faster. “
For Jacksonville-based PS27, the investment represents the biggest funding round it has ever been a part of, and the first time it has invested alongside one of the largest venture capital funds in the country.
Palmer and Stallings connected a few years ago as the entrepreneur started building Payall, which he founded in 2018.
Having PS27 as an investor was important, Palmer said.
“We were way oversubscribed,” Palmer said, between the Andreessen Horowitz investment and earlier investors who wanted more of the deal. “I made room for Jim. I told some inside guys, I’m sorry, but I’m not going to take your money. I want to get Jim involved in the company. I had some existing investors who weren’t quite happy about it, but I really wanted Jim to be an investor.”
Being part of the deal could have a ripple effect on PS27 — “Other entrepreneurs that have big ideas are going to read it about, and they’ll find their way to us,” Stallings said — as well as on the First Coast.
“I’m not sure Andreessen Horowitz knew where Jacksonville was,” Stallings said, “and now they do.”
Other fintech companies are already reaching out to PS27, he said, which could help spur the growth of the sector in the Jacksonville area.
And the local venture fund has had an impact on Payall, too, Palmer said.
“Before this call, I had a call with a financial institution in the U.S., and they were introduced by Jim,” he said. “It was a bank that I didn’t have any contacts at and Jim called me a couple days ago and said, hey, they want to talk to you. He’s out there doing what he can to get us into banks.”
