Dive Brief:

• Account-to-account payments provider Dwolla appointed financial technology and payments veteran Lawrence Herman as its CFO, as well as tapping two other payments industry experts as new board members, the company announced in a Thursday press release. Alka Gupta and Millicent Tracey will join as board members.
• Herman and the two newly appointed board members will leverage their combined experience in the payments space to help drive growth and innovation at the Des Moines, Iowa-based embedded payments company, Dwolla said in the release.
• Dwolla’s new executive leadership members are also joining the company after it posted 45% growth in its partner ecosystem for Q1 of 2023 in April, which included the addition of new companies such as data aggregator Flinks to its Secure Exchange solution, the company said. Dwolla CEO Brady Harris attributed part of the jump to “surging demand for powerful payments solutions paired with recent advancements in faster payment technologies,” he said in an April press release.

Dive Insight:

Herman joins Dwolla from machine learning company Accrete AI, where he served as CFO and interim CFO for two years.

A veteran of the technology and financial industries, his previous roles include a stint as SVP, head of finance for global cryptocurrency platform Paxful — where he drove 60% in annual revenue growth in his first year, according to his LinkedIn profile — as well as director, FP&A for AI platform Dataminr. Herman has also logged time in financial roles for Big Four accounting firm EY, card networks Mastercard and American Express, and at banks Citi, Morgan Stanley and Goldman Sachs.

Herman’s focus as CFO will be on “profitable growth, operational excellence and maximizing the value we deliver to our customers and stakeholders,” he told CFO Dive in an email. The payments industry veteran is aiming to ensure the A2A provider is using the best systems to provide “greater operational metric transparency” to inform decision-making, he said. 

”Additionally, by managing budgets and improving margins, I aim to enhance Dwolla's competitive moat around its technology platform, further solidifying our advantage over time,” he said.

Herman will leverage his past executive experiences and exposure to “innovative fintech sectors” to help foster growth at Dwolla, bringing an understanding “of entering new markets, effective pricing strategies, and prioritized investments in new features and adjacent offerings,” he said. 

Herman’s “financial expertise and leadership will be instrumental in driving our growth and optimizing our operations,” Dwolla CEO Harris said in an email, pointing to the opportunities of the expanding A2A payment space. Dwolla has a total addressable market of over $77 trillion, he said. 

Both Gupta and Tracey have also logged extensive experience in the payments space as new board members, with Tracey serving as board director for the California Bank of Commerce as well as spending time as a digital payments advisor for Nacha, according to her LinkedIn profile. Gupta, meanwhile, has an extensive background in fintech, payments and marketplaces, according to Dwolla.  

The two board members as well as Herman will be taking on their leadership roles as Dwolla looks to capitalize on the growing momentum of the A2A payments space — a method of payment that enables transactions to flow directly from one account to another, such as a consumer’s account to a business or from a merchant to another business.  

The expansion of real-time payment networks helped to push forward A2A payments growth last year, with such payments accounting for $525 billion in global e-commerce transactions for 2022, according to a March report by FIS.

There were nearly 70 RTP networks that helped to push A2A payments up 13% from its 2021 total of $463 billion, FIS said in the report.

“​​​​​We recognize the transformative impact of real-time payment networks on the payments landscape,” Herman said, noting the company remains at the forefront of the A2A payments space. “We are prepared to adapt to industry shifts and ensure our customers derive maximum value from the evolving payments landscape.”

The rise in usage of A2A payments comes as many companies in the industry gear up for the launch of the Federal Reserve’s FedNow real-time payments system, which will compete against the Clearing House’s RTP network. First launched in 2017, the RTP network currently reaches 65% of U.S. demand deposit accounts, according to the TCH.

Prior to the planned launch of FedNow this July, over 120 companies have signed up to aid in development of the network, including payment processing company Jack Henry — which has over 20 of its client financial institutions set to go live with FedNow between late July and August, CFO Dive sister publication Payments Dive reported in early May.

Dwolla itself was an “early adopter and supporter” of the RTP network, its CEO Harris told CFO Dive in an email, and is also featured in the Fed’s FedNow Service Provider Showcase, which focuses on helping to prepare businesses to adopt the network. 

“As we eagerly anticipate its launch, Dwolla continues to stay at the forefront of emerging payment networks, continuously evaluating opportunities that align with our mission of simplifying and democratizing innovative payment solutions,” Harris said.