A Discussion with Patricia Montesi, Co-Founder & CEO, Qolo

Emily Chang: Hi. I’m Emily Chang. Author of Brotopia. Welcome to the SHEconomics series honoring women who are blazing trails as CEOs and founders. Today I am joined by Patricia Montesi, co-founder and CEO of Qolo, a full-service payment platform built for the new economy.

Patricia, thank you so much for joining us. It's great to be here with you.

Patricia Montesi: Emily, thank you for having me. It's really an honor and a pleasure to be here.

Emily: So, Qolo, spelled Q-O-L-O, what does that mean?

Patricia: So, Qolo is actually an acronym, it stands for quality of life organization. And that actually is really all about the founding partners coming together and doing what we love and working with people who we respect. But fundamentally, what we do at Qolo is we are the infrastructure layer of payment processing. And so we've put together this omnichannel platform that's evolving much more quickly than the new economy and fintech space, etc.

Emily: So, quality of life, how is that integrated into the culture of the business? How do you see that philosophy playing out?

Patricia: Well, I think, you know, myself and my partners, we spent 20 years in the payments world. And what we saw a couple years back was really sort of disheartening because what we saw was people not loving the payment partners that they had. We saw people looking for more, demanding more. And we decided to come together and use our experience to build out the most modern omnichannel platform in payments. And what that allowed us to do is do something that we loved, have a purpose, be in control of our destiny with our startup. And the quality of life that we look for is embedded in our company culture as well as our clients. Because we ask the clients to save all the headaches they have with their current partners—you don't need to have those anymore. Come to Qolo and you'll have a better quality of life as it relates to payments.

Emily: So, the payments industry is incredibly competitive—small to big players with deep pockets. I'm thinking about PayPal and Stripe. Where does Qolo fit in?

Patricia: So, Qolo actually sits across many of those functions themselves, right? And without getting too complicated or technical, we sit on the issuing side, a lot like a Marqeta. We sit on the acquiring side, a lot like a Stripe. We sit in the middle of the payments core similar to what NFIS or Fiserv does. So, what we decided to do is build all of that because we saw fintechs and new economy companies looking for more than what they were able to get from the banks. And they wanted to mesh everything together. They didn't just want a new credit card or a new debit card. They wanted to compete with banks and have all this different functionality.

And what they were having to do, instead of going to their current payments partner was they're either having to go build it themselves, find another supplier that could do the capabilities and the function that they wanted, or they had to build up, go out and stitch together these ecosystems. And so what that translated to was a lot of overhead, a lot of complexity and a lot of cost. So, if they had to code around their existing payments partner, they weren't benefiting from that. They were having to build these big monstrous, what we call the spider web of fintech. And at the end of the day, that takes their eye off of what they're trying to do—which is disrupt a vertical or a market, etc. So, we decided to come together and say, "You don't have to wait anymore. You should be demanding more." And now Qolo's here.

Emily: What's it like competing with companies that large, though? I don't know, you use the metaphor, the spider web of fintech, but, like, the tarantulas of fintech?

Patricia: You know, a lot of us have worked for those titans that I mentioned in our past lives. And they've built what they've built through M&A. And by virtue of doing that, they have the capabilities, but it's not on the same platform. So, it ultimately is a very disparate experience. It's just within the same company. So, what it's like competing against those players? It's fun! We enjoy every minute of it! We believe that from an innovation perspective and a flexibility perspective, there's no other platform that exists that does what we do. Every time we celebrate a takeaway from a legacy player, it's high-five time.

You know, nothing says it more than client testimonials and we had a prospect come to us through a referral. And they went back to the referral after meeting with us and they were like, "Are these guys for real? Because I've looked at every single competitor and they are light years ahead of them." And the referral was like, "No, they absolutely are for real. They have all of the 20-plus years of experience in payments and what they've built is real." So, we signed that client and we're excited to be launching them in March.

Emily: You're personally based in South Florida. What's it like building a company in South Florida when a lot of tech startups and so-called talent and venture capital is based in Silicon Valley?

Patricia: I think generally, there was a pocket of fintech in Miami as well as some older legacy players that existed in the Fort Lauderdale area. That's where I came from. That's where I got my start in payments. So, there is actually a lot of talent there that understands payments, not necessarily fintech, because there's a difference, but understanding payments at a very deep level. So, we were able to quickly recruit some very high-caliber people. Almost everybody on our team has 10-plus years of experience in payments. So, we started off that way and we have grown through... obviously, the pandemic meant that we didn't have an office space and we had to look around and recruit for talent. And we made an early decision to say talent first, geography second. So, we're 78 people strong today and they exist throughout the world. We have some in India, we have some out in the Bay Area, we have pockets of Sioux Falls, because we really wanted to recruit people that had payments experience, banking experience, etc. So, we have a wide-ranging group of people that came together.

Emily: Now, you were the first in your family to go to college, as I understand it, University of Miami. Tell me about your upbringing and how you got there.

Patricia: Yeah, I was fortunate growing up that I was encouraged to read a lot. My mother had books everywhere in the house. And by virtue of reading, it made me want to seek out and see the world. And I was encouraged from a very early age that in order to do that, you need to get good grades, you need to go to college, etc. And so, I consider myself very lucky that I was able to get a partial scholarship to the University of Miami. And my parents paid for the rest, which was, frankly, a sacrifice for everyone in our family. So, looking back, I wasn't born into Ivy League schools, but to me, that didn't matter. I was going to make the best of it. And I chose my school. My family supported me. And I graduated and never left South Florida. And here we are.

Emily: What happened after that? I mean, how did you sort of continue to beat that path open for yourself?

Patricia: So, at the time I was graduating, corporate America was everything, right? So, there wasn't a lot of entrepreneurial-type businesses that were the focuses in for anyone, but certainly for females. And I hit corporate America and I spent nine years of my life in travel-related industry. And I worked my way up and through multiple positions. I was a vice president at 29 years-old for a $3-billion company. And right around that time is when I got my first entree into payments. And so, getting into payments at 30 years old and never having done it before, I was like, "What is going on? This is so complicated." I was like, "These people are nuts," but I went into the startup world.

So, the startup world really opened my eyes to the art of what's possible. How you can create, how you can put your stamp on things, how you can come out the other end with an exit that's very material in terms of wealth, right? And so, I took it from there and did a lot of different activities, whether it was working for one of the titans in payments to then going back and doing more startups. And that was sort of my path to get me here to where I am today.

Emily: Now, Qolo is a young company, basically born in the pandemic. What was it that lit the spark, that lit the fire, that gave you the courage to start your own company?

Patricia: There's a couple factors, as usual, right? So, I was consulting at that time for a Fortune 100 company and they were looking to simplify and build payments for various reasons. And I was looking around and I was shaking my head and I was like, "Oh, my God, in order for me to support this company, I'm going to have to tell them to get a supplier for currency, a supplier for acquiring processing, a supplier to move the money." And I was like, "This is really terrible." And I reached out to my partners because we'd always worked with each other and helped each other no matter where we were. And I said, "What am I missing?" I'm like, "Why do people have to do this?" And they're like, "You're not missing anything. That's the state of our industry. And people are frustrated. They can't get what they want out of their current payment partners, so they're building these ecosystems."

So, we just basically got together and said, "Well, we're all complementary skillsets. We've built payment platforms before. There's a huge opening where people are underserved. Let's do it." And, again, you know, luck and fortune that, you know, my three partners are industry experts in their own right. And, you know, the fact that the timing worked out that they, you know, took a bet to come together with me when they could have done lots of different things. So, the spark was, "The industry's underserved. We know how to do this. The opening is great. The markets are hot. Let's do it." And we did.

Emily: What was it like raising that first round of funding?

Patricia: Intimidating. So, what's interesting is that myself and my partners, all of us have held senior-level positions in big companies and we can run budgets and hire people and all these things, but none of us had experience in fundraising. We had never really had the opportunity to do that. So, we just plowed through something that was very uncomfortable. And we asked a lot of stupid questions. And it's very eye-opening. It's certainly stacked against the uninitiated. So, if you don't just plow through, you're not going to get anywhere, right? So, I think what I found was, there's a lot of opaqueness. And if you're not networked in with that group and you don't know people, it's very difficult to get an audience.

Emily: So, how do you overcome that? If you don't have a network, where do you start?

Patricia: I've literally... we started with a spreadsheet and we started with combing through LinkedIn and saying, "Who do we know here, here and here that knows how to raise money?" You know, we reached out to our entire network. And, bit by bit, we were able to get a foothold in there. And, you know, I think we pitched probably 50 different... at least 50 different VCs. Something happened during that time that helped us tremendously was I found a gentleman by the name of Eric Bachman who's now a board member for Qolo. And I was introduced to Eric and he was an early member of Marqeta as their COO. And he knows all about fundraising. So, thank goodness for working my own network and finding out about certain people that can help me. But it's intimidating and I think sometimes purposely so if you're not in that circle, but we just pushed. We believed and we pushed through.

Emily: And you're raising money again now. And I'm so curious, what's your pitch deck and your pitch? How's it different today than it was when you first started?

Patricia: Well, we got this now. So, I think...

Emily: But tell me about that first time you walk into a room and you're pitching investors for the first time.

Patricia: You know, so I'll start with that and then I'll circle back to the other question about our next raise. There's a lot of help with the perfect pitch deck, right? You can Google it and see a bunch of... ours is even published now, the one that we used for our series A. And what isn't out there is, well, what do you share? What's appropriate? What's not appropriate? What questions should you anticipate? So, unless, again, you're fortunate to find someone like Eric to help you with that, it's challenging to get the message across.

And I think the most difficult part for us was that there was a lot of feedback, which we loved, that people didn't completely get what we did. And they thought we were doing too much. And from our perspective, we were frustrated. We love the feedback, but we were like, "We’ve got to find someone that sees the same vision as ourselves." And we were, again, fortunate to find that in the Raptor Group, which lead our series A, and a gentleman by the name of Jim Pallotta, who has a long history in the financial world, a very successful one. And they got what we did and they understood. And it was trying to decide which pieces of feedback to incorporate and which pieces to ignore? And the one key thing that we did ignore was people saying that we're doing too much. We doubled down on it. People thought that it was so broad that people couldn't digest it. And so, we were like, "Well, we want someone that can digest it." So, ultimately, we found the right partner to do that.

And, moving now into series B, and, again, once you've gone through something, you feel a lot less intimidated, right? So, we went through the A. We have a great network now of traditional VCs as well as others. And, you know, now our focus is to pivot. Series A is you got this problem. You're proving product-market fit. This is the traction you've made. Series B is all around, "Well, can you execute and can you monetize?" And so right now our pitch deck is moving from sort of, "Here's the problem, here's how we're solving it," into, "Hey, we're an operating business. We've signed 4X customers than we thought. We're executing them and taking them live and here's what the numbers look like." So, it's just a different way of an operating business versus the typical 10-page pitch deck.

Emily: Now, it's no secret women are underrepresented in entrepreneurship. Women founders got just 2% of funding in 2021, which is the lowest it's been in five years—slightly higher for mixed-gender teams. When you are out there raising money and even today, do you ever feel like an outsider? Do you ever feel like being a woman puts you at a disadvantage?

Patricia: Well, first, I'm going to tell you that I think that number is appalling. Pathetic. It's disheartening. And I don't think I even realized when I was going through this that I had... you know, by virtue of being a female, I had a lot of odds stacked against me. And I think it's a shame. I think that we have to use the mantra of Qolo, which is, "Demand more." That's our tagline. We demand more of ourselves. We tell our clients to demand more of their payment partner and we need to tell the VC community to demand more for female founders because we're not just a carve-out, right? You know, they have these little carve-outs because it's the right thing to do, but when that carve out equals 2%, that's a shame. And we all have to play a part in that.

And, you know, part of what I'd like to play a part in is helping people maybe not be intimidated by doing it, right, becoming a female founder, understanding that intimidating process of raising money. Making those things simpler because even a fully fledged executive like myself, I didn't know, right? I didn't know how to put it all together. I didn't know how to incorporate which one should I do? Should I do a C-corp? Should I do an LLC? I didn't know all those things, but I can run a huge business division. And I think that's changed some and improved. But the more that we can sort of take away some of the fear of the risks that are involved, I play my part, right? But I think anyone that has a voice to raise awareness, the 2%, raise awareness that it's wrong, that it's bad, that an integral part of female voices is being left out.

Emily: So, what advice would you have to a woman out there who's thinking of starting her own thing but is terrified?

Patricia: Do it. I mean, I had to overcome my own fear. And it's not an easy thing to do. You are taking risks. But I honestly think it is leveraging your network. It is finding... you have to find people that have done it, that can help you. And I've started some of that myself with different pockets of small businesses, etc., but I think all of us have to have to do something. This series, it's highlighting female founders, right?

Emily: Sheconomics.

Patricia: Exactly. The more we get the word out that we're here and we can do this and we can help others and make it less intimidating, that's a start. But I think, in order to make order of magnitude change, there needs to be more because I feel like we've been leaning in for 20 years and we got 2% of all the funds.

Emily: We've been leaning in for a lot longer than 20 years.

Patricia: Well, I think we've been conditioned to think...

Emily: The door's been nailed shut.

Patricia: We've been conditioned to think that's okay.

Emily: So, I'm curious how has what you've learned influenced your leadership style and how you run the company? Because you're not only learning how to start a company and all of these technical details but how to be a CEO, right?

Patricia: Yes. Yes, my first foray into being a CEO. You know, I've always had a certain style of leadership. I don't think the core of that has changed, necessarily. But startups are hard. And when you're growing at the pace that we've been growing, starting in January of 2021 at 20 employees and ending the year at almost 80. And we're tiny in the whole scheme of things, but that's a lot of pace, right? That's a high velocity of change. And my job is to manage through that chaos, because it can be chaos. And so, what we want to do is make sure everyone understands the vision of what we're doing and the part that they play in it. And I think that's crucial.

And my style of doing that is, obviously, leading first with empathy, understanding that we're asking a lot of people, understanding that we may have communicated something last week, and, "Oh, by the way, we've changed our mind." Because startups are not easy. And when you layer in the fact that we're a payments startup, you can't go early, you can't mess with the fact that you're moving other people's money. Like, we have regulatory concerns or security concerns. So, all of those things play a part. And we want to move fast, fast, fast, but we have to be very cognizant of what we do and the seriousness with which we take that. But I would say my leadership style is trying to embed quality of life, making people feel like they are here for a purpose, that they are stretching themselves, just like I am. It's my first time as CEO.

Emily: Right. How are you stretching yourself?

Patricia: Every day, encouraging people. How am I stretching myself? Intellectually, right? Emotionally, right? Now, looking out and talking to people on a regular basis, reaching down multiple levels and saying, you know, "How are you guys feeling? I know, it's been a rough ride. Let's look forward and not backwards." That's all stuff that you don't do every day in your corporate executive position. Maybe you should, but I'm pretty proud of where we are. I just got some numbers in, and we're... 45% of our total employee base is female. And roughly that same... 43%, VP and above, are female. So, it's everywhere. 50% of the executive level. I'm very proud of that. We're getting all those voices heard within Qolo and we're going to continue that trajectory because we believe that's important early on.

Emily: So, what goals are you setting for yourself and for the company? Where do you want to be in five years?

Patricia: We want to continue the growth, right? What we've seen from a traction perspective is, you know, 4 to 5X what we anticipated. We think the world is our oyster and we have to navigate through that. We want to continue to take business away from some of the titans and the legacy players. And what we really love is that we're powering people that are disrupting the industries themselves. One of the clients we just signed two weeks ago was just listed on the Forbes 50 companies changing the world. So, we feel great about being a part of helping the disruptors disrupt, right? And so we want to have more of those.

And the TAM and the market is huge, right? And as we grow and sell into more up category, larger customers, our brand awareness is growing, our employees are growing and our client base is growing. So, do we look at ourselves as... we feel like we're just getting started. You know, can you ever guess that you might have someone want to acquire you? We've already had people approach us on multiple fronts. Yeah, but we love what we're doing. We want to continue to grow. We want to find the right investment partners who also believe in that vision and we found it in Raptor. And we're going to find it in our series B partner as well.

Emily: All right. We'll be watching. We'll do a check-in five years from now. Congratulations. Patricia Montesi, the CEO and co-founder of Qolo. Thank you for joining us.

Patricia: Thanks, Emily.