Payrailz, LLC CEO Fran Dugan and VP of Marketing Marvin (Mickey) Goldwasser told Innovation Destination Hartford Website Curator Nan Price about what it’s like to launch and work in and on a tech startup in Connecticut.
NAN PRICE: When did you launch Payrailz and how did you develop the business concept?
FRAN DUGAN: We launched the company publicly in November 2017. It’s my second startup. I started my first company in 2010. It still exists although I’m no longer involved.
The idea for Payrailz had been brewing for a while. Deciding to launch a startup was a big leap for someone like me, who had a very steady bank career from the time I graduated college until now.
I’ve been in banking for 30 years. Most recently I was with Webster Bank here in Connecticut. Having been through all the back-end pieces of banking, I understand how it works and I thought: There has got to be a better way to do this. Technology could be used to be used to help banks transfer money. I had some ideas and talked to some other people, who all agreed we can make the process much better.
NAN: I’ve heard that from other entrepreneurs—their idea sparks from thinking they have a better approach.
FRAN: I’ve always been one of those people who thinks there’s a better way of doing things. Before launching my own company, I had a lot of roles as an “intrapreneur”—an entrepreneur who works inside a company. For example, at Webster Bank we built our own online banking system, which at the time was kind of unusual.
Being in the corporate world things were going well, but I experienced a lot of frustrations, mostly because I would see all these things and think: We should do this and why can’t we do things quicker?
NAN: When you’re in a startup versus a large corporation you can be nimbler. And you can see your efforts more quickly.
FRAN: Absolutely. That’s the benefit. It’s a plus and a minus. Working in a startup there are huge highs and huge lows—and a lot of sideways.
In this world, one day we’ll all be celebrating something we just accomplished and the next day you get a phone call and you think: What happened? That’s something you just have to roll with. And I have found since being in the entrepreneurial environment that I love it. It’s not for everybody. There are definitely times where I think: What am I doing?!
NAN: Mickey, as an employee what makes you want to come into a startup situation?
MICKEY GOLDWASSER: That’s a great question. I’ve been in that conservative banking environment Fran mentioned, where things are pretty predictable. I’ve also worked for other startups. It’s exciting when it’s not predictable because you get to move fast and make a lot of decisions. But also, at the end of the day, you can go home and say: I did something. We’re doing this together. We win or lose together. We succeed together. That feeling is hard to duplicate in the corporate world.
As Fran said, working for a startup isn’t for everyone. And it is a roller coaster. You learn over time to kind of level it out. You also learn to fail fast. What I mean is, there are a lot of ideas and sometimes they’re not going to work, so it’s having that ability—almost the luxury—to be able to take those experiences and keep moving forward.
NAN: Fran, you mentioned the highs and lows. Anything else about being an entrepreneur that’s been unexpected? Anything you wish you’d done differently?
FRAN: The speed at which things happen is so much greater both in a negative and a positive. In my particular role, the amount of decisions I make in a day is phenomenal. But, when you’re an entrepreneur and you get into that mode of speed, it can be extremely frustrating when the rest of the world isn’t at that pace.
NAN: When it comes to decision making, how do you develop that kind of entrepreneurial leadership?
FRAN: I’ve had the benefit of coming out of that corporate world, where things can be analyzed to the bitter end. Some decisions you’re sort of forced into. It’s a learning thing. I don’t think you jump into being an entrepreneur and suddenly become that way, but you realize decisions must be made.
I think I learned a lot from launching my first startup, so the second time through I’ve been better prepared. For example, knowing to start now thinking about something we need in a month. You can’t wait until you need it.
There are things I put in place this time that alleviate some of that, knowing you’re going to need to make some of these decisions. And hiring good people. This time around, I have good investors and I knew upfront I was going to hire some good people. That cost money, but it makes the business work. Lesson learned from the first time: You can’t do it all yourself.
MICKEY: What I like about the entrepreneurial environment Fran has created is that there is no box. You can’t say: Here’s our culture unless you live that culture. As a leader, Fran’s door is always open. I like the collaboration this company brings. Everybody in the room has an opinion that’s heard. I think that’s what an entrepreneurial environment encourages.
NAN: Tell us about what Payrailz does. What differentiates you from other companies and makes you innovative?
FRAN: Payrailz provides technology solutions to banks and credit unions. What makes us different than what others is we are incorporating artificial intelligence into our platform to deliver smart payment solutions in what we call the “do it for me world.” The real innovation behind it is leveraging data and using automation to help banks provide more value for their customers.
NAN: In terms of these customers and your clients, how are you marketing?
FRAN: From a marketing standpoint, we go direct to some financial institutions. We also use reselling partners—there are other groups that sell technology to banks and credit unions—we can be part of their suite. We market a lot through social media, public relations, tradeshows/conferences and word-of-mouth. In this industry everybody knows everybody. So, when something new comes along, it tends to be a little viral and we’re kind of in that storm right now.
NAN: Does being in Connecticut play an important role in your business?
FRAN: That’s a good question. One of our founders lives in Florida, so we debated where to locate the company. Many of us are coming from financial services in the New England area.
I moved to Connecticut about 20 years ago and I think it’s a great place because we’re growing our business around the concept of family. We’re very big on our culture. At a lot of startups, it’s row faster, row harder because they’re trying to make that next dollar for their investors. Our company is not that way. We have good investors, but our focus is to be a place people want to work, where they can have life balance and build careers they know they can grow in. That’s fundamental to our company.
NAN: Let’s talk about funding.
FRAN: We are a startup and we are a technology company. A good amount of capital is required to build the types of capabilities we’re developing. We have some strong investors including Webster Bank, Live Oak Bank, Woodforest Bank, and First Data Corporation, which is one of the world’s largest card processors. We like to have clients as investors—banks and unions—so they get the benefit of using our services, but also the benefits of being an investor. That way our visions are aligned.
NAN: With an eye toward the future, what is your ideal vision for the company?
FRAN: We think we’ve got a new approach to payments and our vision is catching on within the market. We didn’t just want to be just another “me too” company and we believe we can bring innovation to the industry with a solution that simples lives and adds value.
To this end, we’re growing pretty fast. We’re now up to 21 people. It’s going quick and we’ve got some very large clients. In April we moved to a larger facility in Glastonbury. That’s a sign of growth.
As we grow, I want to keep that small company family feel. To me it’s not always about making money. It’s about building a great company by providing a great product backed by great service. The question for our team is: Can everybody have a sense of accomplishment, feel good about who they’re working with, and have fun? I’d be happy if my employees can say: I’ve had my whole career here and I have a great life.
At this point, we’re moving along according to plan. In the future, we will have proven ourselves and we will have people who are saying great things. I’d like to think in a couple of years you’re going to hear not from us, but from others about what a great company we are, what great services we provide, and what great people we are to work with.
NAN: As a technology company, how will you continue to innovate?
FRAN: It’s always hard. I look at us as suppliers of technology, so I’m not going to invent artificial intelligence. It’s more about understanding how things work and thinking about using new technology in new ways. One way to do that is by listening to what your clients tell you. What are users doing?
It’s not always about doing something outlandishly wild much as it is understanding where the world is going. And it’s going to toward this do it for me world, so we think we have a long road there. But I’m never worried about not having a new idea. My staff would probably tell you they wish that would stop! I’ve never met a whiteboard I didn’t like!
MICKEY: Fran is an entrepreneur who has created an opportunity for people like me who have the same kind of vision where we can almost start with a blank slate, but also take all our experience and match it with the newest technology. What we are trying to do for banks and credit unions is enable them to simplify lives and add value.
NAN: Any advice for others on their entrepreneurial journey?
FRAN: You have to have a thick skin. I also say life is short, so if you think you might to do it, do it. You can’t worry about all the things. If it doesn’t work the first time, the second time, or the third time, it doesn’t mean the fourth time won’t be the charm.
People ask me if I wish I’d started my own business earlier. I don’t know if I have any regrets about starting when I did, but I’m glad I did it. Anyone who has a good idea or thinks they want to try it, just know you have to do a lot of work. You’re not going to come up with an idea that will earn you $10 million in a week. You’ll be lucky if you do that. If nothing else, pick something you enjoy, find good people to work with, and you’ll have fun. At the end of the day, that’s what it’s about.
Learn more about Payrailz, LLC