Stan Schwarz, Founder and Owner of PassTime USA


What are the cur­rent strat­e­gy and com­pa­ny mis­sion for PassTime USA?

PassTime is cur­rent­ly see­ing a lot of con­sol­i­da­tion in the mar­ket so a pri­ma­ry focus of our com­pa­ny is to ensure that we are doing every­thing we can to meet the needs of our exist­ing cus­tomers — lock­ing them up tight. At the same time, we are also devel­op­ing strate­gies that will allow us to expand our foot­print.

Specif­i­cal­ly, we are look­ing at oth­er ver­ti­cal mar­kets such as elec­tron­ic infor­ma­tion, some lead gen­er­a­tion, and we are form­ing a lot more insti­tu­tion­al con­tacts that we ever have in the past.

His­tor­i­cal­ly, our cus­tomers have been pri­mar­i­ly Buy Here Pay Here and Inde­pen­dent Deal­ers. Now we’re also form­ing strong alliances with port­fo­lio buy­ing com­pa­nies, point of sale com­pa­nies, banks and cred­it unions. The per­fect exam­ple is SFG Finance. SFG Finance is a com­pa­ny based in Texas which pur­chas­es auto­mo­bile retail install­ment con­tract port­fo­lios. We just launched a new pro­gram with them where — if the deal­er is going to sell their paper — SFG Finance is going to give the unit to the deal­ers for 90 days free with­out the deal­er hav­ing to pur­chase the unit. And then when they pur­chase the paper, the bank will end up pay­ing PassTime for the device.


What are your mar­ket­ing objec­tives and what do you see as mar­ket­ing oppor­tu­ni­ties for the sec­ond half of this year and beyond?

Our imme­di­ate objec­tive is to edu­cate the deal­ers about the two dif­fer­ent types of prod­ucts in the mar­ket­place. Essen­tial­ly, there are prod­ucts which help with col­lec­tions, and prod­ucts which help with repos­ses­sions. What we have been preach­ing all along is how to improve col­lec­tions. PassTime is con­tin­u­ing to edu­cate the mar­ket with what we call ACT.

ACT is auto­mat­ed col­lec­tion tech­nol­o­gy. The deal­ers are start­ing to require more than just GPS track­ing. They are start­ing to see that they want to be able to enhance their col­lec­tion activ­i­ties so we are very, very focused on get­ting out the word on how our tech­nol­o­gy is dif­fer­ent and how our col­lec­tion num­bers, rel­a­tive to oth­er providers in the mar­ket, is sub­stan­tial­ly dif­fer­ent.

From a long-term per­spec­tive, we are focus­ing on mar­ket­ing to and work­ing with a lot of large banks, finance com­pa­nies like Mor­gan Joseph and those type of folks that are buy­ing the paper and ware­hous­ing some of the paper. Our tech­nol­o­gy can enhance those port­fo­lios and by inte­grat­ing our tech­nol­o­gy into their sys­tems, we can help make their col­lec­tion process more effi­cient and the tech­nol­o­gy extreme­ly sim­ple to use.

We have done it with Mor­gan Stan­ley and we are start­ing to do it with some oth­er large, I guess you would call them PE firms and/or banks.


How would you assess the cur­rent indus­try sit­u­a­tion?

I think what you are start­ing to see in the over­all indus­try is a large-scale con­sol­i­da­tion- real­ly at all lev­els. Not only in device providers, but in ser­vices as well … DMS com­pa­nies, for exam­ple. You are just see­ing that it is an indus­try that is matur­ing and is becom­ing more insti­tu­tion­al­ized. With that you start elim­i­nat­ing a lot of the periph­ery play­ers because there is just not a lot of room.

So, that is basi­cal­ly where it’s at right now. It is on every lev­el it is not just one or two. I think you will see one, or maybe two or three providers in our space at the most. I think you will see basi­cal­ly one or two DMS car­ri­ers sim­ply because of the demands that as the indus­try is grow­ing up and the big­ger play­ers are com­ing in you have to be able to inte­grate with them and if you can’t you are just kind of lost in the shuf­fle.


What do you con­sid­er PassTime’s most sig­nif­i­cant accom­plish­ment in the past year?

First, I think PassTime’s expan­sion in Cana­da and the UK. PassTime’s prod­uct base is absolute­ly explod­ing in those mar­kets. In fact, in the UK we are sell­ing at lev­els four or five times what they were just a year ago. It is remark­able.

Sec­ond­ly, on a part­ner­ship basis, I would say the SFG Finance rela­tion­ship that we have formed. I think that is absolute­ly — once it catch­es hold it can be a game chang­er in the indus­try. The abil­i­ty for qual­i­fied lenders to get access to PassTime prod­ucts with no upfront device cost to the deal­er or ini­tial lender while also pro­vid­ing them access to need­ed cap­i­tal and liq­uid­i­ty through their rela­tion­ship with SFG Finance is some­thing this mar­ket has nev­er seen before.

So, over­all, I think our biggest accom­plish­ments are the inroads we have made over­seas and with our north­ern bor­der friends as well as the bank­ing rela­tion­ships that we are start­ing to form here in the Unit­ed States.


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