As the offline payments space looks for scale, the point-of-sale is shaping up to be the next battlefield in local. During a panel at the Street Fight Summit West moderated by Mark Canon of IBID Strategic Consulting on Tuesday, Patrick Gauthier, Head of Product Strategy, Retail Services, PayPal; Square’s strategic partnerships chief Chuck Kimble, and Clover CEO Leonard Speiser took a deep dive into the delicate dynamics of bringing local businesses’ payments into the cloud.
A big part of the shift still sits with killing cash, says Gauthier. “A massive amount of payments are still made in paper. There’s plenty of opportunity to electrify that, and that provides great velocity for small businesses, for which electronic payment was previously out of reach.”
It’s a critical first step toward bring the deeper analytics, and other added services, which cloud payments enable. But, for SMBs today, the value of cloud payment and point-of-sale system is still about making merchants existing actions easier rather than opening new possibilities, said Square’s Kimble: “It’s exciting to provide analysis, but it’s the simple blocking and tackling – basic analytics.”
The panelists also discussed a perennial question in the technology industry, and increasingly important strategic decision in the payments and POS space: open or closed. Square, which recently launched it’s Square Stand to buttress its position at the point of sale, has traditionally taken a more closed approach, while eBay has announced partnerships with a number of ePOS players similar to Clover.
“There’s an obsession with creating a product that is polished to the Nth degree,” said Gauthier, framing eBay’s more open strategy. “It works well when you sell a device, but they delay when you’re trying to make services work elsewhere than the ivory towers of Silicon Valley.”
Kimble emphasized that despite its place at the point of sale, Square is still pursuing partnerships and open-source projects.
But at its core, the effort to bring the point-of-sale to the cloud is about building a software distribution framework for small business similar to the way Apple’s AppStore provided an easy marketplace mobile apps.
“Somewhere, in a college dorm room, there’s a 20-year-old kid who has a great idea for an analytics product for a small business. But there’s no place to plug it in. He’s got no channel,” said Speiser. “Imagine a day if you could be a kid in college, and all of sudden there’s hundreds of thousands of merchants at your fingertips.”
Steven Jacobs is Street Fight’s deputy editor.