Shift4, a payments rollup and what we’ve termed one of the four horsemen of restaurant POS, has once again proven its willingness to innovate. This time through the investment of R&D into a centralized, unified API endpoint to all of its POS systems.
Termed Marketplace, third party solutions now have a way to establish bidirectional communication with Future POS, Harbortouch, Harbortouch Bar & Restaurant, POSitouch, and Restaurant Manager – the restaurant POS assets under the Shift4 portfolio. The implication of this effort cannot be understated.
Prior to Shift4’s acquisitions many of the legacy POS systems they now own had no plans of investing in a stable integration endpoint. POSitouch was so slow in developing a cloud roadmap it drove one of its largest resellers, CBS, to build their own cloud POS solution.
Fast forward 18 months since the acquisitions and Shift4 has been able to do something these brands couldn’t do on their own in over 3 decades.
Yet unlike competing app store or marketplace efforts, Shift4 is not viewing Marketplace as a source of revenue for themselves. “We’ve not tied any revenue goals or forecasts to marketplace,” says Brendan Lauber, Shift4’s co-founder and CTO. This is a 180 from companies like Clover, NCR, and Toast, who have too-frequently viewed third party innovation as a selfish source of revenue, often with the same 30% tariffs that have Apple before the Supreme Court on anti-competitive claims.
Instead, Shift4 is using their heft to drive better economics for their channel partners.
We’re negotiating terms with third parties to take advantage of the scale we bring. This involves securing the best market prices available as well as ensuring our channel gets meaningful revenue share.
Brendan Lauber
We asked for clarification on what these numbers would look like and Brendan expressed that it’s too early to yet have a formalized model.
We just did a deal with DoorDash but there’s not yet an economic model for our dealers. Over time we expect to re-examine the contract economics as DoorDash realizes many of our restaurants want the Marketplace integration to eliminate their suffering under tablet hell.
Brendan Lauber
Brendan is referring to the fact that while many of Shift4’s restaurants may already be using services like DoorDash they do so with an ever-sprawling countertop of tablets, accentuated in the image below. Marketplace makes it easier for merchants to avoid this hassle, and DoorDash will likely realize this is an economic benefit.
If you’re a third party interested in integrating to Marketplace there are no fees, but it will take a bit of time. “Each integration usually needs a slightly different type of API so it’s not totally scalable yet. We have a free certification process to ensure the integration is stable and we anticipate rolling out 3-5 new partners per month,” says Lauber. Right now Shift4 is prioritizing integrations with “large logo” third parties that people seem to be asking for, and with partners that can move quickly.
You’d be surprised how long some ‘technology’ companies take to get moving, so we often prioritize someone who’s willing to move faster.
Brendan Lauber
If you do want to integrate to Marketplace you need to realize that Shift4 uses dealers for distribution. “Third party partners need to motivate dealers economically to move their products since we don’t expect much self-selection by merchants.” This is a truism we’ve observed with app stores as well. “We feel we’re different in that we’re passing whatever revenue share we would have earned on Marketplace to our resellers.” Dealers, if of the actual VAR variety, can provide substantially more value than a remote POS company, and Marketplace gives them a chance to show how.
Yet marketplace is not limited to third party ISVs. Just like Shift4’s SkyTab solution, POS ISVs can leverage Marketplace for their own use cases. For companies like NCR, who have struggled in building a workable third party partner program for Aloha, this could be welcomed news.
What about the direct integrations parties like DoorDash have today? “Over time we expect to phase out the direct integrations. It might sound selfish but the truth is that it’s easier to support a unified API endpoint than a bunch of unknown, direct integrations that can break POS systems and increase support costs for us and our channel partners,” explains Lauber. From the perspective of a third party, which we are, it’s much easier and cheaper to deal with an endpoint than it is to support a software client at a local site (which is what you still have to do with NCR Aloha, as crazy as it sounds). As of today, no new, direct Shift4 integrations are being approved, and at some point in the future there will be a drop-dead date for third parties to use Marketplace, but Brendan didn’t have a timeframe he could yet announce.
Now we get to the most important part of the article.
How, as a Shift4 reseller, do you get to participate in the value of Marketplace?
Our channel partners need to install our Mozart agent. Mozart creates an API endpoint on each merchant site that allows Marketplace to integrate third party applications. Depending on the POS system a reseller supports, the agent can be automatically pushed to all their stores remotely, while in other cases the reseller needs to use a remote access tool – like LogMeIn – and upload Mozart more manually, site-by-site.
Brendan Lauber
Still, we have to wonder why a reseller wouldn’t install Mozart. Shift4 has just invested in a platform that allows your existing systems to benefit from integrations to a myriad of third parties, substantially extending functionality and relevance in today’s market. Now, when you’re selling a new system, you can confidently say that you do have integration capabilities like the latest cloud POS systems – and you do it without the tariffs while negotiating the lowest possible rates from third parties.
If you aren’t actively installing Mozart on your existing sites and pitching it to prospects you’re not going to last very much longer.
One has to question where Global Payments is in all of this. Heartland acquired Digital Dining, Dinerware, PCAmerica, and Xpient in mid-2015, and Global acquired Heartland in December of the same year. If Shift4 was able to do this in 18 months, as a much smaller company, what’s Global’s excuse for offering nothing of the sort in 42 months?
“Global is using a third party tool – ItsaCheckmate – for direct integration to its POS assets but there is no universal API that I’m aware of. It’s quite frustrating when dealers are looking for ways to integrate potential partners. We hear offhanded remarks about Mobile Manager supplying connectivity but there’s been nothing formal ,” shares a Heartland reseller.
Global refused to respond to commentary on the matter, which has pretty much become par for the course since we told the truth about their rate ratcheting. Maybe they’ll respond to their resellers, who should start asking more questions now that they see what’s possible.
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