In only a few months, the Victoria-based #Fintech start-up DivDot went from launching the beta version of their payments software to a registered money services business - processing millions of dollars in business transactions for Canadian businesses.
What is DivDot?
DivDot is a payment software that enables businesses to send and collect no limit payments for a flat fee. They don’t charge a percentage of the amount - and the idea behind this concept was the foundation of DivDot.
How it all started…
Two of the co-founders, Matt and Nick discovered a gap in the digital payments market when they failed at their previous business model. Initially, they had planned to build a credit card processing software.
“When we launched the credit card tool, our customers kept saying that they didn’t want to pay a percentage of their transaction’s value in fees. We were trying to think of a way to get around using credit cards.” Nick, CTO
They found that businesses had digital solutions for all their payments - except high-value transactions that they were still forced to use cheques for. It is hard to believe that in 2018, Canadians processedover 600 million cheques - the U.S. recorded as many as 14 ½ billion.
Most interestingly: While the volume of cheques has been on a clear downward trend over the last 5 years, the average transaction value of a cheque has increased - indicating that businesses still see value in these payment types for higher-value transactions.
On the other hand, a study found that 69% of businesses currently accepting and writing cheques would be willing to move away from them if a more convenient electronic method were available (Payments Canada, 2018).
The moral of the story: Businesses are looking for digital payment solutions, but they are lacking effective means to process high-value transactions.
Bringing business payments to the digital age
The three Co-founders Matt, Nick and James made it their goal to “eliminate any reasons why people would want to use cheques” and provide businesses with a state-of-the-art payment solution for high-value transactions.
Initially, their plan was to integrate with a third party. But when they couldn’t find a solution that met their requirements, they reached out to other Fintechs, usually to receive the reply “we haven’t built that yet” - so the three technical founders decided to build the solution themselves.
“We had an opportunity to build something, to execute a vision.” - Nick, CTO
As they started diving in, they soon realized how challenging it is to establish a foothold in the payments environment.
“The complexity of how the banks work and interact is far more complex than most people realize” - James, COO
“We kept hitting barrier after barrier after barrier of what we wanted to accomplish and that forced us to learn a lot about the market” - Matt, CEO
Several months later, DivDot now is a registered money services business, regulated by FINTRAC Canada and partners with major financial institutions, ensuring bank-grade security for all their transactions.
Since launching the software in September 2019, DivDot has processed millions of dollars with businesses primarily in the construction industry. Yet, the software is suitable across all industries.
The #Fintech start-up is growing quickly and working on new features to optimize their customers’ end-to-end payment experience - on a mission to advance the standard of payments for businesses in Canada and soon in the U.S..
DivDot was awarded with the 'Douglas Magazine - 10 To Watch Award' in March 2020.