TriumphPay has signed up its biggest client to date for its integrated audit and payment network, inking a deal with the Worldwide Express group of companies, which includes GlobalTranz.
TriumphPay’s integrated network has been in full operation for about 18 months, since its first late-2021 “conforming transaction” that utilized all the functions of the existing TriumphPay “fast pay” service as well as the auditing capabilities of HubTran, which Triumph acquired in 2021.
Signing up large brokers to the TriumphPay network is not a quick process. As Triumph Financial (NASDAQ: TFIN) CEO Aaron Graft said on the company’s latest earnings call, signing up a large broker to use TriumphPay’s network can be a $2 million investment on the part of the new customer to rework its technology systems.
And while TriumphPay President Melissa Forman did not disclose the size of the expenditure at Worldwide Express to shift payment and auditing onto the network, “for an integration, this one actually moved very quickly,” she told FreightWaves, noting that the start of the integration process to launch took only about three to three and a half months.
“For a broker of this size, that is extremely fast,” she said. Worldwide Express was “all in and had their development team ready, their operations team ready and so we were able to just work very tightly together to get it done.”
Forman said the integration with Worldwide Express is complete. However, there is a “ramp-up” period as different parts of the Worldwide Express business transition onto the network.
The speed of integrating the TriumphPay network into a broker is heavily impacted by the transportation management system the broker is using, Forman said. A large broker with a highly customized system will be a much longer process than a company using an off-the-shelf service.
And with time comes experience. Forman said TriumphPay, in undertaking an integration of its network into a broker’s TMS, “is definitely pushing the time frame more than we have historically.”
She added that another large broker is likely to “go live” with the TriumphPay network this quarter, and the time frame for that installation also will end up being about three to four months. Forman declined to identify the company on the brink of joining the network.
TriumphPay management has often talked of tier 1 brokers, though they will concede that is an internal metric that includes companies servicing $500 million of annual freight spend. On the most recent Triumph Financial earnings call — TriumphPay is part of Triumph Financial — Graft said 18 of the top 30 brokers use Triumph for audit, payment or both services. A company using one of those services but not both would not be using the network, which Triumph defines as both segments working in sync.
On that earnings call, COO Dan Curtis said TriumphPay signed one tier 1 broker for audit services during the first quarter and had a tier 2 broker go live for audit services. He said the pipeline of new customers “remains strong.”
Without identifying the company, Graft said on the call that some tier 1s that the company thought would have been on the network by the fourth quarter have since slid, “so that volume is yet to come.”
In the first quarter, despite a drop in revenue as a result of average lower invoice sizes, the EBITDA margin at TriumphPay improved to negative 66% from negative 114% the prior quarter.
The full-service network at TriumphPay that was built on the back of the HubTran acquisition includes what the company calls a “presentment” of an invoice, an audit of that document and rapid payment. TriumphPay began its operations as a sister company to the factoring business of Triumph Business Capital by offering brokers quick pay services.
Company management has stressed repeatedly that it keeps the factoring business at Triumph--which is the recast name of the company's factoring business that previously operated as Triumph Business Capital--separate from TriumphPay and doesn’t allow the factoring business to access data on Triumph competitors who are using TriumphPay functions.
The Worldwide Express group includes a significant package and parcel delivery business. That’s one of the reasons GlobalTranz acquired Worldwide in 2021. Pre-acquisition, GlobalTranz was a truckload and LTL-focused 3PL.
Forman said the parcel concentration is irrelevant to the capabilities of the network. “We do payments for shippers and most shippers have a high parcel concentration,” she said. “So we execute payments all day long for parcel transactions.”
More articles by John Kingston
TriumphPay network’s growth slows by some measures, stronger by others
Triumph’s Graft: The concept is proved, on to producing revenue at TriumphPay