Payments as a Value Creation Lever in Private Equity

Higher financing costs, longer holding periods, and compressed software multiples mean private equity firms can no longer rely on financial engineering alone. Durable outcomes depend on repeatable operational changes that expand margins and increase revenue.

Embedded payments has emerged as one of the most scalable growth drivers for software-enabled businesses. When built directly into core software workflows, payments becomes a usage-based revenue stream that grows alongside your portfolio company's customer base.

Closing the execution gap Most underwriting models account for payments upside. Few capture it. Strategies frequently stall due to fragmented infrastructure, misaligned customer workflows, and a lack of clear operational ownership.

Created in partnership with TSG, this playbook outlines how sponsors can treat payments as an operating capability rather than a vendor decision:

• The three-phase execution model: How to sequence payments deployment, from workflow integration to advanced financial services.

• Real portfolio economics: Why embedded payments can expand revenue per customer by 3x to 5x

• Lessons from public platforms: How market leaders generated transaction-based revenue streams that outpaced core subscription software.

• Diligence and post-close priorities: Key questions investment and operating teams must ask to stress-test payments revenue before and after acquisition

Read the full paper: Payments as a Value Creation Lever in Private Equity