To remain competitive with Stripe, Adyen and FIS’s Worldpay, Fiserv’s Carat is as focused on expanding existing client relationships as it is winning new business, said Fiserv executive Casey Klyszeiko.
Carat is Fiserv’s global commerce operating system that caters to large merchants and other businesses – the enterprise counterpart to Clover, Fiserv’s point-of-sale system for small businesses.
At Carat’s core is payment processing, and from there, clients can add services or tools relating to data and analytics or alternative payment method acceptance, said Klyszeiko, a Fiserv senior vice president and the head of Carat and global e-commerce at the payment processor.
In late September, Brookfield, Wisconsin-based Fiserv broadened its relationship with Inspire Brands, which counts Dunkin’, Baskin-Robbins and Sonic among its portfolio of 32,000 restaurants worldwide. The expansion means Fiserv will integrate in-store, in-app and online commerce for several more of Inspire’s restaurant brands, adding “several thousand additional restaurants,” although the company declined to elaborate further on the details of that relationship.
Klyszeiko, who held positions at card networks Visa and American Express before joining Fiserv in 2021, spoke with Payments Dive Oct. 12 about Carat’s growth and position in the market.
Editor’s note: This interview has been edited for clarity and brevity.
PAYMENTS DIVE: Is the recent expansion of the existing relationship with Inspire Brands indicative of the kind of business Carat is prioritizing going forward, or is Carat more focused on pursuing new clients?
CASEY KLYSZEIKO: The answer is very much both at this point. We have depth within big, large verticals, whether it be petroleum, quick-service restaurant, retail, government, B2B, e-commerce. We really run the gamut of verticals and we go quite deep in each of them. We have some of the biggest names in the world within the portfolio today. And then we also have many that are mid-market clients as well, looking to scale.
The Inspire deal is what “good” looks like in many ways for us. It’s expanding within that client base, where, frankly, we’re just scratching the surface of what we can help them deliver. That might be expanding into omnichannel with our clients, going from a card-present relationship to a full card-present/e-commerce relationship where we can connect customers, connect data, connect experiences; helping them with new payment flows they haven’t thought about before; or whether that’s going into new lines of business.
The ability for us to serve our customers even more and even better is one of the largest opportunities. There’s obviously a ton of new businesses coming up the chain right now as well. We talk a lot about e-commerce platforms, payment facilitators, software vendors. We've definitely invested heavily within Carat to serve the needs of those businesses that are emerging.
Sometimes it seems Clover, Fiserv’s small merchant business unit, is the favored child over Carat in terms of growth and attention. What do you make of that, and how are you working to keep up Carat’s growth rate?
In jest, we say Carat’s the baby of the family, in the sense of, the brand hasn’t been around as long. We celebrated our two-year anniversary recently as a brand. Clover has been with First Data (now part of Fiserv) for over a decade and really grown exponentially.
They’re both operating systems and they’re both fundamentally doing the same thing, for clients of different sizes. They are driving singular, unified entry points to simplify the experience. They’re control centers to help consume data, look at trends, analyze the business, optimize payments, whether that's your Clover dashboard at a small business, or whether that's Carat’s client reporting portal and new data-as-a-service solution for enterprises.
We actually have a lot of benefit from being together, because we can leverage those things from each other, whether it be the actual platforms and services, or the insights and knowledge about how businesses succeed. It’s a real differentiator for Fiserv.
Clover is a B-2-small B name, which makes it a little bit more of a brand name than Carat, probably, on the street. My mother knows what Clover is; she struggles with what I do. But I don't think internally we have any of that. We’re really kind of symbiotic with the two.
Carat faces intense competition from Adyen, Stripe, FIS’s Worldpay and PayPal’s Braintree. How is Carat working to stay one step ahead of those rivals?
We think of ourselves as open. Carat’s a modular ecosystem, where you can take different components of the stack, to solve the problem you need in the moment.
When we think about competition, honestly, we're not focused on this processor, or that processor. There are so many companies that provide value-added services, fraud detection and risk scoring, real-time payment solutions, currency solutions, global acquiring orchestration, data engines. Our space is very full with different offerings. And our goal is just to understand the customer, serve them and if they want these solutions, just like an operating system would, we integrate them, we build up the orchestration, we make it easier to consume for them.
In the market, I think we're competing with a lot of people, but we're also partnering with a lot of the same people at the end of the day.
Do you agree with Fiserv CEO Frank Bisignano’s assertion earlier this year that Carat will be the dominant winner in the market in the next two to three years? What will it take to get there?
That's always our goal, right? We feel like we’re in a good position, and continuing to grow and win. It's about staying focused on the customer, and working from the customer, back. Customers want simplicity. There's so much proliferation of different technology, right? They want unified access points, they want orchestration, so one player can manage all of the different services that they may consume. And that simplicity is both on the front end, in terms of integration points, technology stacks, resiliency, and they want simplicity on the data. How do I get my data fast, real-time, analyze and action it.
We need to focus on that simplicity, that unification, and being there every day, developing what they need.
Has the competitive landscape led to any strategy shifts or changes in how Carat approaches the market?
We react to what’s happening in the macro environment and what our customers are focused on, more than we react to anything else. So at a time of more conservativeness in the outlook, certainly, our customers are saying, “I need more of every dollar, full stop, pure and simple. How do you make that dollar go further for me?” Customers don’t want to lose a sale because an authorization wasn’t optimized, or because of a false positive of fraud.