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The National Football League’s Dallas Cowboys organization is lending its name recognition to a new merchant-services company, Blue Star Payment Solutions.
Frisco, Texas-based Blue Star intends to build its brand based on its affiliation with the Dallas Cowboys as one of the companies owned by the Jones family, says Jerry Mooty, Blue Star president and nephew of Jerry Jones Sr.
“The industry is not really a branded space,” Mooty tells Digital Transactions News. There is an opportunity to develop a merchant-services company with a widely recognized name and use that to attract merchants, Mooty says. Blue Star is a common name for Jones family enterprises, Mooty says.
Blue Star is organized as a referral partner with Bank of America Merchant Services, but expects to become a registered independent sales organization in April, Mooty says. Blue Star’s services include credit and debit card processing, e-commerce, the tablet-based Clover point-of-sale system, encryption and security services, and merchant cash advances.
Blue Star’s primary merchant focus is on the Dallas, Austin, and San Antonio regions and will reach into surrounding states that have a strong Dallas Cowboys fan base, Mooty says, though the company will work with clients anywhere. Each merchant that activates a Blue Star processing account is automatically enrolled in the Cowboys United fan club for the NFL team. They’ll receive a special welcome gift, such as a jersey, mug, or framed photo of AT&T Stadium, the Cowboy’s home field. The enrollment also includes access to special events and discounts.
Once Blue Star becomes an ISO, it will set its own buy rate, Mooty says. The buy rate is the wholesale price for basic payment processing; sales agents sell above that rate to make their revenue.
Currently, Blue Star has 10 internal sales agents and has two outside salespeople starting next week, Mooty says. Plans are to grow the sales force dramatically over the next year. Hires will be a mix of employees and independent contractors, he says.
Payments-industry veteran Lane Conner, who, according to his LinkedIn profile, worked at First American Payment System and Century Payments Inc., is vice president of sales and strategic partnerships. Brad Woy, who started merchant cash advance company CapRock Services, leads Blue Star’s corporate strategy and business development.
Mooty says the combination of the Dallas Cowboys name and the payments expertise Blue Star has assembled bolsters the company’s prospects. “The goal is to have a long-standing stake in the industry,” he says. “While the margins are small, if you plan on being in the game for a long time, growing a portfolio makes a lot of sense.”
Indeed, that long-term strategy may pay off for Blue Star, says Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group, a payments-advisory firm.
“It’s been a good business for a long while and still is a good business,” Ablowitz says of the merchant-services industry. Having the backing of the Jones family, and the recognition from the Dallas Cowboys affiliation, will help. “It’s not surprising that a family with money would want to get into payments,” Ablowitz tells Digital Transactions News, “especially in Dallas where there are quite a lot of payment companies and a lot of talent.”
The margins are still good, he says. He cautions, however, that startups need to develop uniqueness. Find a vertical market to focus on and use technology to make it more efficient to find and serve merchants in that vertical, he suggests. “The way to get outside of the margins is to have something that’s unique and defensible,” he says.
