WEX is one of the largest B2B payment processing companies in the country with reported total volume of processed payment their fleet solution payment processing transactions hitting over $139.2 million in their fourth quarter alone. Famously, trucking is also the most common form of employment in almost all 50 states according NPR’s investigation of census data. So with a massive market in fleet, how does Jay Dearborn (Chief of Strategy) view an ever changing world including the onset of electric vehicles, the onset of technology in generally a very analog industry, and why fleet payments require their own solution as opposed to the broader B2B world? Dive in with us to find out.
What does WEX do?
From 30,000 feet, what we're all about is simplifying the business of running a business. In this context, that means our three different product sets: benefits, corporate payments, and fleet payments.
What’s happening in payments?
A few major things… 1) Digitization of payments: even when Jay started his career in 2001, he was focused on the death of the check, and it’s still the last bastion of manual payments today. 2) Consumerization of B2B payments: users are seeking Venmo and PayPal-like experiences in their B2B software experiences, so we’ve seen a shift to become hyper-focused on UI. 3) Long-term convergence between software and payments: thinking through how to take software and turn widgets that really turn it into a service, closer to embedded payments.
What about what’s happening in vertical payments and fleet specifically?
It’s all about how you take the payments, the data, and technology together in a way that’s bespoke for a particular segment and then rinse and repeat. It’s not a particularly complex space, it’s just been around for a long time – about three decades – and there are only a few players purely focused on it.
How to map the huge billion-dollar market in the fleet?
WEX thinks about two buyers on the services side: the fleet manager who is typically mid-market or more advanced fleets or the small business owner who has very limited time, and they need the operations of the fleet to be abstracted away so they can do their most pressing work.
It seems like all of the new VC-backed entrants are making plays to 15 other financial services outside of just fuel cards. What does expansion in this space really look like?
At WEX, the spirit of the offering is simplification, and so there is an absolutely sensible sense in expanding the suite of product offerings. The WEX learning is to focus less on what they CAN do and more on what the customer craves. This has meant investment in the credit extension area more than anything.
Where does EV come into play?
It’s not a transition to EV; it's a transition to a mixed fleet… and there’s still a financial services experience for that source, which is less complex in the money movement sense but may command a SaaS model.
What’s the most exciting trend happening?
For Jay, it’s much less about the business model and much more about empathizing deeply with a top pain point for the finite profiles of customers they engage with. The most exciting focus for him is about a workflow that needs to be solved.
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