Strategic Advisory in Payments
& Payments Technology

Buying Merchant Residuals: Where Do I Find Them?

There are a lot of investors out there interested in acquiring merchant processing residual streams. Actually, from our perspective, there are a ton of investors out there looking to place capital through merchant ISO, portfolio, or residual acquisitions. We receive inquiries from these buyers all the time.

Interestingly enough, though, very few of the interested investors know where to find these types of properties. So here’s a little cheat sheet on ideas for locating merchant residuals for acquisition:

  1. Industry Attorneys: There are quite a few attorneys and law practices in the acquiring space. These are specialists who have built their practices within the industry, and in doing so, have nurtured many a relationship with owners and operators of merchant processing platforms. If you can identify them, and network in, they can be a great resource for merchant residual stream and merchant portfolio leads.
  2. Industry Conferences: Payments industry conferences and trade shows are great networking venues that are designed to create business opportunities for the companies that exhibit there as well as attendees. Within the bankcard industry there are four annual events which are especially geared toward attracting portfolio and residual owners. The Northeast, Southeast, Midwest, and Western acquirers’ associations each hold their own regional conference once a year. These shows bring together some of the largest bankcard industry players, as well as regional members. Additionally, there are national conferences held annually hosted by organizations like Money 20/20, ETA, and NACHA, all of which attract many merchant portfolio owners.
  3. Industry Consultants: Just like any other industry, the merchant acquiring space has plenty of consultants, and the relationships these consultants have can be of great value to a would be merchant residual buyer. However, not all of them are specialists on the acquisitions front. The acquisition specialists may cost you a few bucks for their services, but no one has a better pulse on the market conditions and available opportunities. Further, in many instances, especially if you are a first time buyer who is already operating in the space, or an investor from outside the industry, you’re going to need additional services from the consultant to assist you with understanding the valuation of these types of properties, as well as being able to walk you through the deal process and structure. So it’s always a good idea to secure a relationship with a qualified bankcard consultant before you jump into an acquisition project.

Hopefully the information above will prove helpful in your endeavor to find merchant portfolios and merchant residuals for sale. Happy hunting and good luck!