EngageSmart soars 40% in trading

For EngageSmart CEO Bob Bennett, it’s about “achieving nirvana,” which in his universe is when a business has 100% automated invoicing as well as 100% automatic payment of invoices. invoices.

While this lofty goal may be more lofty than attainable in real life, Bennett said the actual counts of his company’s more than 70,000 customers are consistently approaching nirvana.

“[EngageSmart] almost always replaces something else, but we [are] out there because we drive adoption and get our customers into that state of nirvana twice as fast as anyone else, ”Bennett told PYMNTS minutes after his company’s actions had just started. to trade $ 10 above their initial public offering (IPO) of $ 26. “So our prospects see that because we have the numbers and then they say, ‘OK, if I’m going to make a change I’m willing to endure some pain’” in order to get to a better place.

On paper, EngageSmart provides customer engagement software and integrated payment solutions tailored to five verticals: health and wellness; government; public services; financial services; and give. Each of the verticals is designed to simplify customer engagement with their customers by driving digital adoption and self-service.

“Digital payments, of course, have been a tailwind for those of us in the payments industry,” Bennett said. “It’s inefficient to write paper checks, it’s inefficient to receive paper invoices, it’s more work than it takes.”

Within its growing customer base, the now $ 5 billion Boston-based software company serves more than 68,000 small and medium-sized business (SMB) customers and more than 3,000 enterprise-sized customers.

Drive digital adoption

With enterprise solutions, he said, the company typically replaces a customer’s existing electronic invoice payment and presentation solution. But within his SMB solution customer base, such as those in the wellness industry, Bennett said 60% of those customers came from pens, paper and spreadsheets. They do not have practice management software and few of them have electronic payment capability.

“So there’s a lot of greenfield in this segment,” Bennett said, noting that for a business of any size that sends out invoices, it’s much more efficient to move to digital transactions.

Benefits of Digital Invoicing Retention

Bennett gave the example of an insurance company. To renew policyholders, the company has to send a lot of mail. Customers forget that they have to renew every year; in fact, he said that is the main reason customers don’t pay bills.

EngageSmart eliminates this problem by providing user-friendly email reminders during the billing cycle and giving its customers’ customers the ability to enroll themselves for paperless billing and automatic payments.

“If they’re with us, they can sign up for auto-renew and auto-pay and just automatically reinstate their policies, which then increases policyholder retention,” Bennett said.

“Thus, digital payments are an important part of the business model that drives greater consumer retention, greater customer satisfaction and fewer defaults. “

Switch to self-service

Likewise, with SimplePractice, the company’s solution for health and wellness, consumers make their own appointments. They log in, find the calendar, make an appointment, and get immediate confirmation with a calendar invitation. The patient also receives a reminder the day before.

“What we’re doing is driving digital self-service,” Bennett said.

These solutions also eliminate phone calls asking where the invoice is or whether payment has been received. Customers can view their balance immediately through the Customer Portal that EngageSmart provides on behalf of its customers.

The company’s InvoiceCloud includes electronic invoice presentation and payment solutions for governments. It manages property taxes, taxes on motor vehicles, remission of parking infractions and parking meters. It also includes a solution for utilities and insurance companies.

The rising tide of electronic payments

In these areas, paper checks continue to represent a significant portion of remittance invoice payments. Cash does this too, so the company also converts cash at major retailers into utility bill, tax and insurance policy payments.

“We are riding this rising tide of electronic payments, replacing paper checks and walk-in traffic and people paying in cash,” Bennett said. “Again, we’re improving digital efficiency and giving our clients time to focus on their most important initiatives, their community and their people.

Bennett said 60% of the company’s revenue comes from transactions and 40% from subscription software.

“I think digital payments are an incredibly great place,” Bennett concluded. “A member of the electronic payments industry told me that if I spent a year in the electronic payments industry, I would never want to leave. So far he has been right. It is absolutely a gift to me, and I am the luckiest man on the planet.

Shares of EngageSmart closed their inaugural trading session at $ 34.12 per share, up 31% for the day and totaling more than $ 1 billion in value added to the company’s market cap.