Last week, FinTech and payment startup Helcim unveiled its latest hardware product: a new point-of-sale device called Smart Terminal.
The standalone, wireless processor allows small and medium-sized businesses (SMBs) to accept in-person credit and debit payments via tap, chip and PIN, manage inventory, and issue receipts.
The Smart Terminal, which comes preloaded with Helcim’s point-of-sale app, aims to eliminate the need for merchants to manage multiple devices with the benefit of no contracts or monthly fees. Instead, merchants pay via an interchange-plus-fee model, which Helcim claims saves businesses 22 percent on average.
“We were hoping to actually bring this to market a year prior, but we kind of had the rug pulled from underneath us.”
Nicolas Beique
CEO, Helcim
The journey to this launch was not an easy one for the Calgary-based startup. According to founder and CEO Nicolas Beique, Helcim encountered significant delays in building the device after its manufacturing partner, BBPOS, was acquired by a prominent Silicon Valley-based competitor and pulled out of the project.
“We were hoping to actually bring this to market a year prior, but we kind of had the rug pulled from underneath us,” Beique told BetaKit.
As of last week, the Smart Terminal is now officially available to pre-order for merchants in the United States and Canada, and Beique called the release an important step in its mission “to be the world’s most-loved payments company.”
Helcim, which targets its payment solutions to traditional SMBs, such as home-services businesses, retail merchants, auto-repair shops, and health-care clinics, initially offered a card reader, which Beique described as a “more entry-level product” with a lower price point and fewer features compared to the Smart Terminal.
The startup released the second generation of its card reader in 2021, and since then, Helcim has gathered feedback from merchants, who expressed that they wanted a standalone device that did not need to be paired with a phone, tablet or computer. Merchants also asked Helcim for more traditional point-of-sale features, like a built-in receipt printer.
“We took all that feedback and said, ‘Okay, the market has spoken, let’s go build this thing,’” Beique said.
According to Beique, the project to build Helcim’s Smart Terminal began in partnership with manufacturing firm BBPOS. Helcim had been working with BBPOS since 2020 on the startup’s next-gen card reader. The Smart Terminal was initially slated to be released in 2022, and Beique said in the early months of that year, the two companies were starting to finalize the details of the first manufacturing run of the Smart Terminal, and the product was “coming to life.”
But according to the CEO, that all changed in April 2022, when he received a letter from BBPOS, terminating the two companies’ business relationship.
“Due to the changing business of BBPOS, BBPOS will not accept your purchase orders that have not been accepted prior to the date of this letter. Please do not submit further purchase orders as they will be rejected,” a portion of the letter read.
In addition to partnering with Helcim in the past, Hong Kong-based BBPOS had manufactured hardware for a number of other payments companies. BBPOS was one of the manufacturers behind Stripe’s point-of-sale service, called Terminal, which was made available to US users in 2019. In January 2022, Stripe agreed to acquire BBPOS, a move that brought the development of Stripe’s Terminal readers in-house.
Helcim, which is a smaller player in the payments market compared to Stripe, began offering its own built-from-scratch payment stack to businesses in Canada and the United States in 2020, which put it up against the likes of Stripe, Square, and PayPal. Even major Canadian e-commerce brands that offer payment integration, such as Lightspeed and Shopify, use third-party firms like Stripe to process payments.
RELATED: Shopify partners with Volt to offer open banking solutions (but not in Canada)
Beique described his reaction to BBPOS’s letter as one of frustration.
“It was a painful reminder that we compete with large incumbents with a vested interest in keeping the status quo,” Beique said at a recent event announcing the launch.
While Beique told BetaKit he was aware of BBPOS’s existing relationships with other payments companies, he added, “I think that the general expectation is that when you find a manufacturer to partner with, it’s not going to be somebody that’s going to kick you out. But this was definitely a lesson learned.”
By summer 2022, Helcim was able to find a new manufacturing partner, Taiwan-based Castles Technology, to complete the build of the Smart Terminal.
“I think it worked out in the end, because we think this is a bigger manufacturer with more capability, so we were able to ultimately come up with a product that we were happier with,” Beique said.
With the Smart Terminal launched, Helcim plans to begin distribution to thousands of merchants in the coming weeks. “The reaction has been awesome—this is the device they’ve been asking for,” Beique added.
William Anifowose, co-owner of Calgary-based Jade and Dagger Tattoo, said the Smart Terminal is “intuitive to use and provides added flexibility for me to accept payments at my shop, or when attending conferences and events.”
Helcim is gearing up for more product launches this year, including a feature that will allow merchants to add a pass-on fee to online transactions at the time of checkout if the customer chooses to pay via credit card instead of a bank account withdrawal or electronic transfer. The startup also has plans to launch new payments and software offerings for merchants, including a recurring payments management suite, later in the summer.
Beique said Helcim’s ability to work on all these new offerings at the same time was a product of raising venture capital. Helcim raised $16 million CAD in its first venture financing round last year, led by Information Venture Partners and the Aquiline Technology Growth Fund.
RELATED: Boostrapped since 2008, Helcim raises $16-million for Stripe-like payment solution
Since closing the Series A funding round, Beique claims Helcim has “tripled the business in terms of customers and revenue,” though he declined to disclose the startup’s customer count. The team has also grown to 150, and Beique said he hopes to make that 250 next year.
“[The funding] allowed us to be able to work on more initiatives in parallel,” Beique said. “When you’re a bootstrapped company, you’re really happy to be hyper-focused on one thing, because you only have so many resources. We’re still hyper-focused on servicing our traditional SMBs, but [this funding] lets us start making more product initiatives at once.”
When Helcim raised the round in March 2022, Beique told BetaKit he wasn’t concerned about competitors like Stripe or Square. When asked if his view on competition has changed in the last year, Beique acknowledged that competition within the payments industry is inevitable. Still, he believes Helcim is still very focused on going up against legacy processors, and the challenges with the Smart Terminal launch have made the company more careful when it comes to its vendor and partner relationships.
“Payments is payments, and ultimately you’re going to be stepping on toes,” Beique added. “Everyone steps on each other’s toes a little bit, and that was a reminder of it—from heavy toes.”
