The payments sphere is growing so fast that demand for industry executives is outstripping available talent, say recruiters in the field.
That’s generating offers that are often 30% above a job candidate’s current compensation because that’s what it takes to pry workers away from employers desperate to keep them, or to outbid competitors in quick negotiation cycles.
“There’s a shortage of talent because there’s so much demand,” said Chris Pantelidis, who oversees payments industry searches for the global executive recruiting firm EMA Partners. “That puts huge pressure on the talent market because we don’t have enough executives to fill all those roles and everyone is looking for the same types of attributes.”
Pantelidis points to a massive 30% to 40% increase in the size of the payments ecosystem over the past five years to explain the talent feeding frenzy. In addition to traditional bank card issuers, payment acquirers and processors expanding their businesses, pioneer paytech companies like PayPal and Square are scaling services too, and there’s a swarm of fintechs hungry to build the latest payment tools.
Executives typically change jobs from December to February, after they’ve received year-end bonuses. In the payments arena this year, “hundreds of top executives are about to pull the trigger,” Pantelidis said last week.
More positions came to market over the past year than in any year from 2008 to 2019, said Pantelidis, a New York-based managing partner who has been in fintech and payments since the mid-1990s. To handle the demand, EMA doubled the size of the payments, digital and transaction group he oversees to 26 workers.
Google, and rivals rush in
Companies across the payments spectrum are caught up in the race. Exhibit A: Alphabet’s Google hired Arnold Goldberg from PayPal this week to run its payments division, after his Google predecessor, Caesar Sengupta, left last year to form fintech Arbo Works, which poached Google’s payments team members, the news outlet Bloomberg reported.
San Francisco payments software firm SpotOn pulled off a hat trick early in the new year, hiring a new chief financial officer, a new chief revenue officer and a new chief people officer. Atlanta crypto payment services company BitPay this week hired its first chief operating officer, tapping Fiserv veteran Jim Lester for the role.
Last month, Overland Park, Kansas B2B payments player TreviPay snatched a new chief revenue officer, Jeff Coppolo, from rival Bluesnap, and also hired a new chief risk officer, Rissi Lovern. “There was lots and lots of competition," said TreviPay CEO Brandon Spear. “Candidates who are coming onto the market were typically getting snapped up in a couple of weeks,” he said.
TreviPay, which was acquired by a private equity firm in 2020, didn’t need those C-suite executives when it was owned by a large public company, but it does now because it's growing and the new owners will eventually pursue a public stock offering or sale of the company. “We're trying to maintain all of the requisite optionality by just being as prepared as we can be,” he said.
Candidates call the shots
“It’s a candidates’ market,” said Marc Badalucco, whose Allen, Texas-based executive search firm, Impact Payments Recruiting, specializes in payments. “People know what they’re worth and they’re going to go get it,” he said in an interview this month.
CEOs in the industry were drawing total compensation of anywhere from $1.5 million to $12 million last year, with chief revenue officers earning $475,000 to $3.5 million, chief technology officers taking home $500,000 to $2 million and CFOs bringing in $363,000 to $725,000, according to an annual guide published by Impact Recruiting. Mid-tier positions range between $100,000 and $500,000. (The level depends heavily on the size of the company, and other factors, like whether it’s public or private.)
“The pay rates have increased dramatically,” said Badalucco, a managing partner at the firm who heads sales and marketing. When this year's guide is published the rates will be about 30% higher, he said.
Anyone with product, operations, risk or marketing expertise is in high demand, Badalucco said. Marketing professionals couldn’t find jobs, but now they’re a hot commodity as companies jockey to spotlight their products, services and hiring, he added.
Counteroffers become routine
There are situations where a corporate client will offer $20,000 to $30,000 more than a candidate’s current pay, but then lose out because the employer offers another $20,000 to keep the employee, Badalucco explained.
Counteroffers were infrequent before, but now they're commonplace, said EMA’s Pantelidis says. In the past, he suggested clients offer a candidate a 15% to 20% increase over current compensation, but now he recommends a 25% to 30% premium.
In one instance, he advised a client wooing an executive earning $2.5 million in total compensation to offer at least 30% more (some candidates will ask for 40%), but the client was only comfortable with 15%, he said. The employer countered with a $1 million equity bonus and promised an early review of compensation. The candidate stayed put.
“It’s very costly to have to replace somebody,” Pantelidis explained, not only because a company will have to attract a new hire, but also because it will fall behind in the fast-evolving industry.
The Northeast U.S., the West Coast and Florida all offer above-average compensation for payments professionals, according to a map of salaries in Impact’s 2021 guide.
Benefits too, please
It’s not just about money. Payments professionals are also seeking better benefits and more flexible work conditions becoming more available as employers seek to stem the Great Resignation.
Those companies that insist on employees being at a physical location are “struggling,” Badalucco said, noting he won’t even take some of those assignments. “You just can’t attract talent the way you used to,” he said.
Shiny new lures being waved at prospects include the digital checkout company Bolt piloting a four-day workweek; cross-border money transfer company Wise providing 18 weeks of paid leave for a birth or adoption; and crypto services provider Bitpay offering to pay employees partly in Bitcoin.
“Attracting candidates is as competitive as ever so companies must find innovative ways to stand out from the others,” Bitpay said in an emailed statement.
Young fintechs are sucking up billions in venture dollars to fund their headcount expansion, with old-line companies upgrading their management ranks to compete. Meanwhile, new companies targeting payments in specific industries, from insurance to healthcare, need professionals too, Badalucco said.
“Anybody good in this industry is going to be getting tapped on their shoulder multiple times,” he said. And the outlook for 2022 is more of the same. Badalucco adds: “It’s not slowing down.”