Web hosting provider and domain registrar GoDaddy announced this week that they are partnering with Early Warning. Early Warning is co-owned by a number of US banks and is the company behind the p2p payment solution Zelle. The partnership enables Godaddy’s customers to accept payment via the popular p2p payment method.
But let’s take a closer look at the steps GoDaddy has taken in the previous years towards embedded finance, and let’s speculate what could follow.
GoDaddy’s first and (likely) most significant step towards embedded finance was their acquisition of Poynt in December 2020. Poynt offered a suite of products tailored to small businesses, including POS, payment processing, and invoicing. This acquisition enabled GoDaddy to extend their existing offering around domains and websites and offer ‘an unified commerce platform’, which was the foundation for everything that followed.
In the following years, GoDaddy extended this offering and launched a POS terminal for their customers with brick-and-mortar stores. Due to the acquisition of Poynt, GoDaddy has become a payment facilitator. This means, put simply, that GoDaddy can handle payments for their customers (= merchants), and the merchants do not need to work with an alternative payment facilitator (i.e., Stripe) or work directly with an acquirer (this is often not possible for SMEs anyway). Becoming a payment facilitator does not only mean GoDaddy can offer payment services to its customers, but it will also generate revenue from these services.
If you are a frequent reader of this newsletter, you might know that I believe that there are quite a few companies out there that follow Shopify’s embedded finance footsteps. And yes, I also believe GoDaddy is such a company, and in this case, they even serve the same kind of customers: e-commerce merchants. Shopify’s embedded finance journey went from payments to lending to banking. So if GoDaddy gets hooked on embedded finance with their payments product, will a banking and lending product follow as well? Personally, I believe all signs point in that direction. Especially when you study their existing products and think about how nicely they could be enriched with embedded finance.
… Did I get you interested in the possibilities of embedded payments? Then have a look at PYMT’s blog post and video in cooperation with Fiserv.
