Des Moines (DSM) Payment Processing System: eznetpay

The web-based payment processing system created by John Trickel adds speed and transparency to the way construction payments are made. With help from the Business Innovation Zone (BIZ), he learned the discipline and focus necessary to build a successful track record in the school construction market.

"We're disruptive technology that automates the payment application process," said Dave Harrington, director of business development for Greater Des Moines (DSM)-based ezPay, LLC, and its flagship product, eznetpay®. "We've done for the industry what today's email has done to the Postal Service. We process critical project information faster, with better quality and with more consistency than was previously possible with paper-based systems."

A Focused Approach

Mike Colwell, director of the BIZ, helped Trickel and Harrington focus on the school construction market at a time when the general construction market was suffering and school construction was starting to pick up. The state of Iowa had just passed a one-cent sales tax to fund school infrastructure and technology projects.

"We were using a shotgun approach when Mike stepped in and guided us to a very focused prospecting approach," Trickel said. "He told us to use a rifle, and to go after a very specific target. Not just game, but deer, specifically a buck!"

That advice helped ezPay narrow its focus to the top school districts in the state of Iowa, and the continued advice from Colwell and the BIZ helped Trickel and Harrington create great relationships within that market. Harrington has learned the steps to developing good relationships with school district personnel who are bombarded with sales calls every day.

"Our prospects are very busy and I'm competing for their time with everybody selling everything," Harrington said. "Our niche is not to be the commodity seller, bidding on fractions of pennies on products. We want to be the company who says 'tell me about your challenges and problems' and 'check out this solution.'"

Web-Based Payment Processing

Contractor payment terms are pretty standard across the world: Contractors request payment for services as they progress through a project. It's a very complicated process, with all kinds of quirks that can slow down timely payments. Slow payments ultimately affect quality.

"I used to be on the contractor side," Harrington said, "so I've felt their pain. The success of a job is tied to the flow of money. If you're getting payment to your vendors on time, they'll provide high-quality service. Our service makes that happen. It gets those payments done."

Payment laws can require certifications, inspections and a number of approvals before payments are made. It's not uncommon to see a payment application be routed to six to 10 people before it gets approved for payment. Instead of sending physical paper from location to location, eznetpay moves and manages information electronically as fast as e-mail.

People are prompted to take action on payment applications through email notifications. Dashboards highlight real-time progress updates and overall summary reports provide quick looks to key metrics of projects. The information is up-to-date within seconds.

ezPay worked with the BIZ to receive an initial demonstration grant from the Iowa Department of Economic Development, and the BIZ helped keep them on target throughout the development of their idea to earn two additional grants to get it to market.

"The tool drives accountability, which is the No. 1 benefit for an owner," Harrington said. "We've seen payment requests get completely processed in five minutes because all the information is there in one location."

Because it's web-based, the payments can be approved anywhere there's a connection to the web. Key approvals can be made in a timely manner, even when the person's out of the office, at a meeting or even on a vacation.

"I've never seen issues resolved so quickly," says eznetpay user, Val Steffen, of Dean Snyder Construction. "Objections with our draw requests would take too long to resolve and could disrupt our cash flow. Sometimes I wouldn't even know about them until it was too late. Now we know right away and we take immediate action to keep things on track."

eznetpay reduces payment risk because it has an escrow feature that can send funds directly to subcontractors and suppliers or to the general contractor. Because less time is spent tracking lien waivers, change orders and project status with auto-generated reports, users can lower their overall costs. It offers accountability with improved workflow efficiencies and real-time status information, improved decision making with consolidated data, and improved file management and reporting.

eznetpay is used by a diverse group of users including financial institutions, educational institutions, general contractors, suppliers, architects, construction managers, service providers and escrow companies.

"At regular meetings with Mike, he was able to keep us on task with our message, on target with our prospects," Harrington said. "Every time we wanted to sway, Mike was saying 'you have to be focused.'"

Square One DSM, an initiative of the Greater Des Moines Partnership, is formerly known as Business Innovation Zone (BIZ).