Which vertical SaaS businesses have the potential to successfully transition to VERP (Vertical ERP)?

Any case where the cash flow or the flow of funds or payments are complex in some way. There are a couple different things that can mean. Let's take restaurants, for example: You have multiple bills, and typically a successful restaurant has a high volume of payments. You have individual bills per table, then you have tipping, and tipping needs to be allocated with some regulatory formula as well as the rules of the restaurant to the servers and various staff. That's a relatively complex payment flow. Stripe likely isn’t going to build a tip-routing engine any time soon. That's one specific example.

There are other ones where, maybe you're paid on a per job basis, or maybe there's a flat fee for an in-person service business that also makes some kind of revenue share on the products they sell to the homeowner they’re working with, for example. So there's some kind of revenue share. Not only the transfer of funds, but the accounting of that funds flow can be relatively complex. 

A great example of this is a business called WeTravel, where they are a vertical SaaS and payments for multi and often international tour operators. This is an example of an incredibly complex funds flow, where you're booking a safari in Africa. Generally, the person who's booking that trip is paying months in advance, sometimes in installments, this company is holding these funds. Often the consumer or customer is paying on a schedule. The tour company then needs to split these funds out to various local users. They need to pay the hotel in this place and they need to pay the driver in this place in cash. This person doesn't accept credit cards, but accepts this local payment method. The disbursement of payments there is very complex and that has a lot of this complexity. 

Large volume of payments, international payments, payment ahead of time, disbursement of payments in foreign currency payment methods—that alone is an incredibly complex business or set of funds flows that you need to manage. Not to mention again, the vertical SaaS associated with that business, which includes a marketing website and booking. Maybe there's some concept of lead nurturing, some concept of e-signing that you need to do for these folks. I think that's another example where it's not as simple as just moving payments. 

As you have these embedded fintech rules making the building block payments easier, different kinds of payments—not just credit card, but international payments and currency conversions and cash disbursement and things like that—smart entrepreneurs who know these industries very, very well, their ears are going to prick up and they're going to say, ‘Well, I can’t just build software to manage this, but I can actually now start absorbing the payments flow and make the product 10 times better, but also greatly increase the amount that I can commoditize.’