Bob Kaufman and the Cost of Keeping Two Good Ideas Apart

Bob Kaufman has a wonderfully blunt verb for a fairly intricate financial idea: smash. Take the system that lets a business accept a customer’s payment. Take the system that lets it pay a supplier. Put them together. In a travel agency, those two activities belong to the same booking. In banking, they had acquired the dignity of separate departments, contracts and technology. The customer was expected to supply the connection.

Kaufman had spent nearly two decades close to this machinery. He could explain the products. His customers could explain the inconvenience. He has credited them with pushing the idea along: they wanted a better way to manage the money passing through their businesses. That is an appealingly modest beginning for a founder. There was no need to invent a customer problem. The customers had been discussing it for some time.

Two departments, one customer

Accepting a card payment is called acquiring. Sending a payment through a card program belongs to issuing. The terminology makes the separation sound almost natural, as if the money needs a change of clothes before continuing its journey. Kaufman noticed how much work it created for the business in the middle. An agency selling a trip had to collect from the traveler and pay the companies providing it. The two sides were commercially inseparable.

Yet a common bank logo did not produce a common process. Different teams handled different services. Each had its own arrangements. Combining them required more than placing two sales brochures side by side. Kaufman later recalled the legal work involved in producing a single contract that covered both accepting cards and making card payments. Simplicity, viewed from the customer’s desk, can require a remarkable amount of argument elsewhere.

He founded ConnexPay in 2017. The company’s proposition was to connect payment acceptance and virtual card issuing within one platform. It began with travel companies, where the gap between the two activities had particularly awkward consequences. ConnexPay would handle the incoming transaction and the associated outgoing payments together, giving it a view across the flow. The elegance was in following the booking all the way through.

A banker learns to leave the bank

Kaufman brought a substantial apprenticeship to the problem. At U.S. Bank, his responsibilities included finance leadership in Payments Services and running its Virtual Pay division. Product, marketing, supplier enablement and sales all appeared in his remit. He had worked on the numbers and on the practical business of getting a payment product used. Those are useful perspectives when the obstacle sits between a financial model and a customer’s working day.

He studied at the University of Minnesota and later earned a master’s degree at the University of Chicago. His professional story offers considerable reassurance to anyone whose entrepreneurial ambitions have survived a conventional career. Familiarity can sharpen the question. A person who has spent years inside a system has had time to distinguish a passing annoyance from something customers repeatedly struggle to manage.

Leaving still involved a decision. Kaufman recalled trying for a year and a half to establish the concept within the bank, without winning the credit department’s support. His former boss suggested doing it independently. At home, his wife encouraged the move, despite the prospect of four children going through college. He said he gave notice two days later. The company began after a long attempt to make the existing institution accommodate the idea.

The holiday is booked. The money is elsewhere.

To understand what drew his attention, imagine an agency that has just sold a holiday. The traveler has paid. Flights and rooms still need to be secured. In the payment cycle Kaufman described, the agency could wait up to three business days for customer funds while needing to pay suppliers immediately. The sale had created a temporary financing requirement. Multiply that situation across bookings and it becomes a regular demand on cash.

ConnexPay’s connected model gives the agency immediate access to authorized incoming funds for paying suppliers with virtual cards. The customer payment and supplier payments share a system. This also helps with reconciliation: the records can identify which outgoing purchases belong to which incoming sale. Anyone who has tried to establish why a payment appears on a spreadsheet knows that a clear connection has value long after the transaction itself.

There was another difficulty: travel is bought in advance. A traveler pays today for a service delivered later. Banks worry about what happens between those dates, including the possibility that a refund will be needed. Disconnected systems leave them with limited visibility into whether the supplier was paid. Kaufman’s answer was to make the two payments visible together. The aim was to reduce uncertainty and give agencies a more workable arrangement.

Keeping hold of the customer

Kaufman also became an advocate for travel agencies acting as merchant of record: processing the customer’s payment themselves. Some agencies instead pass the traveler’s card information to the companies supplying the trip. That can simplify part of the agency’s payment burden while creating a fragmented experience for the customer. A trip purchased in one place may become a collection of charges and separate conversations when something needs changing.

At Phocuswright in 2023, Kaufman used a familiar retail comparison. Buying a pair of shoes through a marketplace does not normally require the marketplace to hand the shopper’s card details to the shoe brand. The seller can maintain the transaction and the relationship. He wanted travel intermediaries to have a similarly coherent experience, including the ability to manage booking changes and refunds.

There is an ordinary human frustration inside this argument. The customer remembers whom they booked with. Being directed somewhere else when the payment becomes complicated does little for that relationship. Kaufman’s interest in payments extends into that moment: who has enough control to help? The technology matters because it changes the answers a business can give its customer.

“We’re being very pragmatic about how we grow and make sure that our clients are extremely happy.”Bob Kaufman, early ConnexPay interview

Aviators in the accounts department

For someone occupied with payment reconciliation, Kaufman has an agreeable willingness to dress up the explanation. At Phocuswright in Phoenix in 2022, he appeared with TravelPass Group CFO James Hall under a Top Gun theme. Both wore aviator sunglasses for the photograph. A session on supplier payments is entitled to a little cinematic assistance; few people buy popcorn specifically to hear about merchant processing fees.

The pairing had substance. TravelPass was a ConnexPay customer, and Hall described annual savings of more than $1 million from adding the payment provider. Hall’s figure described TravelPass’s experience with the platform. It gave Kaufman a customer beside him who could discuss an actual result. The sunglasses supplied the joke. The CFO supplied the reason to listen.

Kaufman has called himself a car enthusiast and described investing with three partners in a NASCAR-affiliated speedway outside Minneapolis-St. Paul. Hockey is another continuing interest; he grew up playing, and all four of his children played. His father owned a business. Entrepreneurship had places in his life before ConnexPay appeared, including one where the traffic moved considerably faster than a bank approval.

Growth with a memory

The company’s early travel focus eventually widened. In his 2022 funding announcement, Kaufman described expansion into other intermediary businesses, including marketplaces, advertising and ticket reselling. The common feature was a customer payment linked to a supplier payment. A problem discovered in travel could recur elsewhere without requiring every industry to behave like a travel agency.

That October, ConnexPay secured a $110 million Series C investment led by FTV Capital, with participation from existing investors. The intended uses included international expansion and further platform development. In 2023, the business entered the Inc. 5000 after recording 835% revenue growth over three years. Later that year it won Phocuswright’s Travel Innovator of the Year award, following its startup-category recognition in 2018.

Kaufman’s own writing gives growth some qualifications. He has argued for financial restraint and against stretching a company merely to keep it expanding. He has also described giving employees equity regardless of their position or seniority. The reasoning was practical: people with a stake in the outcome have a reason to question a bad instruction and contribute a better idea.

He was explicit about the limits of a founder’s expertise. An organization that treats one person as the source of every answer inherits that person’s weaknesses too. For Kaufman, years in the industry helped identify the people he needed around him. Experience could provide introductions as well as insight. The customer complaint might start the business, but several kinds of skill would be needed to make the proposed simplicity function.

A different seat at the same table

In April 2024, Ben Peters became ConnexPay’s CEO and Kaufman moved to chairman. They had known each other for 18 months before the appointment. Kaufman emphasized their shared approach to culture, customer service and innovation. Peters described him as a friend. The announcement made clear that the founder would remain involved while the new chief executive took responsibility for the daily business.

Kaufman wanted more time for strategic partnerships, larger deals and possible acquisitions. Later in 2024, ConnexPay announced a U.S. patent for technology linking incoming payments with outgoing supplier payments. The company that began by questioning a separation had built its own structure around the connection. Its founder’s responsibilities were changing with it.

The first question remains a useful way to understand him. Why should the customer have to join things that the provider has chosen to keep apart? Kaufman knew the departments, the products and the reasons they had grown separately. Then he chose to work on the connection. For the business trying to secure a traveler’s room while its money waited elsewhere, that was a question worth asking.