Daniel Kalish On Building B2B Payment Infrastructure | Biz To Biz Podcast

You're now watching B2B Vault, the Biz to Biz podcast hosted by Allen Kopelman, powered by Nationwide Payment Systems, the number one solution for payment processing. Hey everybody, welcome to today's episode of B2B Vault. B2B Vault, the Biz to Biz podcast sponsored by Nationwide Payment Systems and our new gateway NPS1. There's an alternative to Stripe and it's NPS1. Go to our website. Nationwidepaymentsystems.com and book a demo, and we'll show you what it's all about. And today we're going to dive into some financial technology discussion with Daniel Kalish from Nilas, and he's in New York. And welcome to the show, Daniel.

Hi, hi, thanks for hosting me. So thanks for, for having me here.

Yeah, tell us about your company.

Great. So first of all, pleasure to be here and speak with you. So Nylus is basically a platform for agents for treasury and anything around cash operations. So we build solutions for large companies, mid-market companies, sometimes high SMBs that are dealing with cash complexity. Folks, businesses that have multiple banks, They have multiple entities, they need to get their cash position daily, they need to follow their cash flow, they need to build a coherent forecast and figure out how much cash should be sent to which entity and what's my funding needs and what's my currency needs or how much cash can I invest. So these are the areas and the complexities that we deal with. And the way we solve it for our clients is actually through agents. So we built a system of agents that can help with data preparation, decision-making, and then execution. So we're really taking end-to-end workflows of your finance day-to-day and team and turning it to an agentic workflow from the beginning to the end. And that's the future. So we deliver it and we work with some of the greatest companies out there. Yeah. So that's me. I can tell about my background and how I got to do this, but that's just a quick intro about Nylus.

We'll get into some stuff. So you talk about the PayPal paradox. Like, what's that all about?

Yeah, so I spent 6 years with PayPal. I led their strategy and market dev team for Europe. Before starting the company. And, you know, working at PayPal, I got a very clear view of the back office of some of the largest merchants and businesses that we were working with and saw how it's elegant and easy on the front end but completely messy and hard on the back end. So we decided to actually build treasury systems that can work with the PayPals of the world, with the Bank of America, with Citi, and combine everything together into one place that is very easy to use. So yeah, that's the, that's, that's the paradox that I love talking about and what turned me into building Agents for Treasury and Cash.

So like your company is basically like taking like a chatbot. I mean, that's what you're doing here and it can execute moving a $5 million $5 million sweeping it out of somebody's account. Obviously it's like pre-programmed based on what's going on with that business. So how is, you know, AI— we were talking about it before we jumped on in the program— AI and AI agents, this is like one of the biggest growing things that everybody's talking about, but not everybody is instituting, whatever, deploying into their business. So like, how much money can this, you know, generate? Obviously, if you're moving around money and you're sweeping and taking cash and putting it in probably money market accounts or whatever that are returning, making a return on the, on the cash, that, that's probably like paying for itself, right?

For sure. And I'll give you a very easy example. So one of our agents, we have a liquidity optimization agent that basically Once we're connected on a live, with live connections to your banks and to your payment PSPs, to your ERP, then you have a complete view, daily view of what's happening in my business from a cash perspective, and we deploy agents on top of it. So one of the agents we have is a liquidity optimization agent that basically on a daily basis scans your balances and thresholds. Aligned with your policy as a company, knows how much you need to maintain as excess cash for each account, and helps you drive actions after this initial review was done. So one of the things you might see is, hey, I have actually, you know, $5 million extra cash here and I'm not really using it in this account. Let's sweep it to a yield-bearing account and do some money out of that. Or that can even go to FX or to other agents, for example, payment monitoring, where we deploy agents for fraud prevention to scan the AP and any intercompany before it's done, make sure it's aligned with the vendors that I already have, the bank account numbers that I already have. So those things that the team is doing today, you're doing today, can actually be delivered to an agent. I just want to caveat one thing. It's not like we're giving the agent autonomous kind of go, and there's a lot of guardrails. There's a human-in-the-loop mechanism, so the agent stops and gets, you know, a response approval, sometimes two approvals, and then acts. So just wanted to kind of mention that from a security and trust perspective.

Oh yeah, definitely. We don't want to have like, uh, the Terminator, uh, AI thing take over the world.

It might happen, but, uh, not, not, not through us yet.

Yeah, we don't need that. So like when, when, you know, like when somebody's using, like, you know, I'm guessing like the treasury, you know, CFO at a company that's managing a lot of treasury operations. And, you know, people don't understand, but, you know, there's money moving around everywhere with big companies. Even a small— even a smaller company can be moving around hundreds of thousands of dollars, right? So, like, how many hours does this, like, save somebody in their daily tasks?

Oh, that's— that's, uh, some companies. So I would— I would, uh, divide that to either companies that don't yet have a full-time treasurer and we can actually be this position for them with our agents. So they're thinking of hiring the next person and Nyles can actually be that and the VP Finance would work with our platform and agents and, you know, just reduces the need to go and hire a full headcount. Then we have companies that already have a treasury team and, you know, they might not need to hire the next treasury analyst. So we're thinking about now this is like a full-time FTE that comes in, in the nature of agents. So hundreds of hours a week.

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The way we think about it, and I think that's like just when I speak about now, as I'm trying to also help businesses and friends understand what is the change they need to actually implement within their teams. We're trying to help our customers or prospects to think about their days, their day-to-day workflows. So you have daily workflows, you have weekly workflows, monthly, quarterly, annual. We're trying to define those workflows for them and help them. Okay, so I have my FX, my bank account opening, my forecast. Each one of these is a workflow that could be almost driven entirely by agents. So that's what we do with our platform, but Even for, you know, the audience and your business, you can think about your workflows and how each one of those workflows could actually become a set of agents to drive it end to end. I hope that makes sense.

Yeah, it makes sense. And then, you know, basically like businesses, I mean, I've been getting, you know, I get emails from people all the time, all day, and I'm reading financial fintech stuff. And, you know, people are trying to figure out how to take whatever cash positions they have and turn that into a profit center. And that's basically what you guys are doing.

Yes, absolutely. Yeah, yeah, yeah. So finance, you know, for years has been like a cost center for the business, but now it can actually become a profit center, especially with Treasury. You can actually make more of your money. You can reduce costs dramatically. You can improve working capital. So many different things that are, you know, an outcome of working, working with Nubs.

So what other— so what, you know, so what other things are going on in the world of finance and AI like that you see businesses starting to do?

So when you think about finance in the CFO office, you have AR, which is, you know, from you know, billing to collection management where our agents now are branching into collections and we can actually send emails and reminders to customers and improve the DSO for the business. So that's happening. To treasury, to AP where you need to maybe— and then reconciliation accounting, you need to reconcile everything, all the cash movements into the ERP. And then under AP, you have payments. So now we're also, we're helping push payments. You know, you have the liquidity position, the agent asks you, hey, do you want me to actually prepare this payment run for you and push it with the bank? So literally end-to-end, the finance CFO office is going through a major transformation, whether you're a small business or a large business. You need to think on how each one of your headcounts is starting to be a manager of agents and not manager of people or their own workflows. Yes, there are people involved, but that's a new world and it's happening everywhere, not just in finance, by the way, also in sales and marketing and other functions of the org. Yeah, it's pretty fascinating. And I think that the real breakthrough truthfully happened in the last 4 months or so. It's happening right now. There was like an upgrade in the capabilities of the LLMs and all the systems involved. Yeah, and it's mind-blowing.

It definitely mind— I mean, whenever I talk about AI, it's, you know, we look around to see what's going on with with AI. Like, AI mess— I got somebody I spoke to on the phone yesterday, links up with me on LinkedIn, and then sends me some weird message. So I sent the guy a message back. I go, you do know we talked yesterday. I don't know what AI thing you're using, but you know, it— yes, you need to watch what it's— you need to watch what it's doing because it's sending out silly messages, you know.

That's the flip side. That's what you want to be. By the way, especially in finance, when we build our agents, we build this with guardrails, with tooling, with testing, with auditability. You can't, you know, in finance you can't mess up a dollar. It all needs to tie back and be perfect. If you can do it with LinkedIn messages and okay, maybe I'm sending a wrong message once in a time, with finance you can't do that. So that requires much more guardrails into how you deploy it. So that for the audience, whether it's with us or with other vendors out there, you really need to make sure that this is a bulletproof system and test this pretty well before it's running.

So where— when businesses have money sitting around besides like money markets, what other— what other instrument or whatever financial opportunities are out there for businesses? What are they doing with their money?

Yeah, so I think, you know, there's the world of, of how do I invest my money, how do I make more, more from what I have. And I think in that world, businesses need to be very careful of you need to make sure you have enough to maintain your operations before you're starting to do investments and like more exotic stuff. And every business can do investment from money market funds, which is very low risk, to investing in stocks. And everything is out there, up to going to crypto if you want that. So there's the world of investments, there's the world of FX currency, which is another interesting area of treasury and liquidity. I assume many of the businesses, many of the listeners have global businesses which require multi-currency setup. There's a lot of risk, and especially what we see now in the world with all the changes, currency fluctuates. So you need to not just make spot transaction, which is ad hoc, but potentially hedge your currency needs.. So, you know, buy future currency in a set position. Then you have also debt, you know, a lot of businesses need to take on debt and that's actually a really good instrument to fund your business. So I would say those three areas are the key financial instruments, but then how do I make sure I have enough for what I need? I would say finance as a whole is a lot around risk management. I want to make sure I have not making any mistake. I have enough for payroll, I have enough for vendor payments, I have enough for funding my own needs and M&A. And then all the nice interesting things around it.

Yeah, my brother's an accountant. So we always talk about, you know, oh, is this a good investment? Or is that a good investment? And my brother always tells me one thing that I'll never forget, and some other people who also, you know, you get advice from just to see like, oh, is everybody aligning? And it's like my kid asked me one time, he goes, oh, should I go buy like $1,000 of Dogecoin? So I was like, well, if you take a— if you take $1,000 and you go buy Dogecoin and you lose all your money How mad are you gonna be, right?

What did he say?

He goes, I'm going to be really upset. And I said, then you shouldn't buy $1,000 of Dogecoin, buy $50. Yeah, you can't, you know, the, the risk, you know, like you were talking about risk management. I mean, you have to just say like, hey, I'm going to buy this, and if I lose $1,000, how pissed am I going to be? Or if I lose $3,000, $5,000, or In some cases, people are gambling with bigger stuff like a million dollars, right? You know, I, you know, can you lose it? So that's when you talk about risk management and measuring the risk and how the, how that risk, um, translates to, you know, risk, risk and reward, right? Sometimes there's, you know, big risk and there's small risk, so you have to kind of measure that out, you know. So does your software also like do risk management assessments?

We try not to give clear advice. At the end of the day, the client needs to take the advice themselves, but we, we provide the data as it is, right? So if you— for a forecast, for example, we can create a bottom-up forecast based on all your AR and AP activity in your ERP. We would bring that up. We would say, okay, these are the scenarios that could happen. You now choose what you want to do, similar to the advice you gave to your son. And okay, that's, that's what I hear. What do you think about it? Is that you're going to be upset about it or not? That's basically what we were trying to do. We're not getting into, okay, that's what you should do. That's— these are the options, right?

So what's your view on, you know, we're discussing finance and money and of course, you know, we touched on crypto a little bit. What's your whole view on crypto? I have my take on crypto because I got involved in crypto and crypto was basically the wild, wild west of finance, right? And it was supposed to be this whole, you know, uncoupled from the government. You know, we got this secret money, you know, flaunt, you know, we got this secret Bitcoins and these Ethereums and the Litecoin and the this going, and right, and nobody's tracking our money. What they call decoupled finance, right?

Yeah, yeah.

And so then we go from that, right, to, you know, okay, now we need government intervention. And the guy, whatever, Ross from Silk Road, if you— anybody knows what that is, he had this marketplace like, uh, like a Craigslist and people were, you know, listing stuff and everybody was transacting in crypto, and he got thrown in jail. But Trump let him out of jail because he wasn't really monitoring what people were buying and selling. And he got accused like, oh, you facilitated the sale of illegal items, blah blah blah blah blah. But, you know, so we go from the Wild Wild West to now we have this government intervention. And then I think the government went a little too far because Now we have these tax laws that we got under Biden where any crypto transactions are taxed, or, you know, when you sell, there's— if you sell any crypto you've had for under a year, there's a high tax. If you had it longer than a year, the tax is a little lower. And you got to really do your— I sold crypto, so I know about the taxes. So you have to know, literally, I bought it on this date, I spent this much money, I paid this fee, and then I sold it on this date, and then there was a fee, and then here was the actual net profit. And you have to like figure that out. There's actually software for that now. I remember when I did it the first time, my brother the accountant got really mad. He's like, oh, we're gonna— you know, he sent me a spreadsheet. I'm like, dude, what is that? That's—

yeah.

Talking to the wrong person. Now you just get a 1099 from Coinbase. Here's your, here's your tax bill. Yes, right. So, you know, I look, you look at crypto and you go, oh well, it started over here and now we're over here, and now we're all of a sudden with this, uh, stablecoin thing, right? Start doing stablecoins. I'm like, well, how can you get— I, I ask everybody, I go, how can you be spending, buying and selling stablecoins transacting with stablecoins, and we still haven't had the IRS change the law on the taxes. So you're going to end up transacting with all this stablecoin, and then you're going to get a bill from— you're going to get a bill from Coinbase for like 30% of whatever you spent. I said, that doesn't make sense to me. I'm going to spend a dollar and it's going to cost me $1.30? I don't think I'm doing that. What's your whole take? Like, when someone says to me, oh, you know, cash needs to be digitized, I say it is digitized. It's in my phone, it's in my wallet. I have plastic, I have Apple Pay, right? What? Yeah, I don't know.

I'll give you, I'll give you my take. I think that's actually for the first time, um, I am a true believer that, um, crypto or blockchain is coming to the masses and is going to make a dramatic impact on our lives. And the reason is stablecoins are basically, you know, aligned with your—

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Currency, whatever USD, GBP, whatever currency it is, but it allows you to work on these stablecoin rails, which are less complicated, real-time, and much, much faster and easier, and doesn't have all the legacy rails on top of it. So for example, for treasury, that's actually a big shift that is coming to market because Let's say I want to make a payment move, an internal transfer from, again, US to UK account. Sometimes, I might not be able to make it on the weekend. If I want to make a more exotic corridor, it might take me a week with the legacy infrastructure. With stablecoins, you can actually make it the same day at the same time. And it actually drives a lot of interesting decisions that today would take a week in advance. You might, as a trader, decide to use a deadline a week in advance and pay $1 million because you're not sure where you're going to end a month and a week from now. If you would be able to use stablecoins instead of that, you can actually wait see where you're going to end the week with. Maybe you cover it with another entity of yours or not. And that's it. You don't need to call the debt. So there's going to be a lot of implications assuming that would happen. And I think banks are now starting to enable that and work with stablecoins more easily. So I actually think a big change is coming to the market. And there's other implications for that. If I just may add, cash seems to be digital today. You know, it's in our Apple Pay, in our everywhere, but the behind the scenes is so old, it's so clunky. And I think that's what stablecoin is trying to make to the industry, if that makes sense. Does that make sense to you?

Yeah, it makes sense on a larger scale of moving large amounts of money, because when we first started dealing with Bitcoin, we were processing several million dollars a month for our clients. So we had a system where we, um, this company— let's say I'm selling you, um, an expensive watch and you say, okay, I want to pay you in Bitcoin. I say, great, the watch is $50,000. I go in the portal, I get your email address, I send you the $50,000 invoice. You get the invoice for $50,000, you hit whatever coin you could pay with Bitcoin, Litecoin, Ethereum at the time, and Doge. You hit the Bitcoin, it says, okay, you need XYZ amount of Bitcoin to give Allen back $50,000. So you would do that. The only hiccups we ran into is sometimes people don't have 50 grand in one wallet, they have multiple wallets, especially the beginning of time, because people weren't using like Coinbase to hold their money. That had it on little thumb drives, you know, on a thumb drive. So they have to do multiple transactions, right? And then the merchant sending multiple transactions. But, you know, that's kind of the— that's kind of one of the clunky parts of transacting with coin. But, you know, they were selling a lot of— we had a lot of guys that were selling jewelry in Miami to international customers, right, all over the world. And they just want to get paid, and then they would just ship the watch to them. You know, obviously there were people they knew, but, you know, like you were saying, getting money like through the SWIFT system can take, you know, 7 to 10 business days. Yeah, the guy wants to— guy wants to come in and pick up the watch, he can just— they can just move, um, digital currency a lot faster. I see right now, I see it more in the bigger ticket movement, you know. Yeah, we facilitated— I would say like the average size transactions we were doing were anywhere from $50,000 up to a couple hundred thousand dollars. And we did have somebody that we helped buy a house in Miami for $1.2 million. Oh wow, it was kind of a pain because I had to go to the title company and the guy had to pay with multiple wallets, so we had to send them about 35 invoices. And then the— it all got cleared. And then we had to call the crypto guys on the phone, and they're like, okay, it cleared. And they wired the money to the— they wired the money to the— to the title company, and they closed. We literally did it in the morning, and by 3 o'clock in the afternoon, the money was in the guy's bank account, right? And then boom, the closing went down before they closed the office. And then The title company was like, they didn't— they were like, well, we didn't think it was real, but I guess it's real. We got the $1.2 million. Yeah, yeah. And, you know, so it's kind of crazy when you see stuff like that. But there's, you know, there's things that have to be fixed in that so that, you know, because we had other people try to use it like in real time, like very hard. Oh, I want to go in the bottle. I want to go get a VIP couch, right? 'Oh, it's $20 grand,' and then the transaction goes through for $5,000. They're like, 'Hey, where's the other $15,000?' And if you're not watching your phone or your tablet, wherever you're doing that, you don't know. So you have to— we told the clubs, like, make people pay in advance. That way when they get there, 'Oh, you got $20 grand, we got our $20 grand, go crazy, spend $20 grand,' right?

Yeah.

So you have to understand, like, That, that's— I mean, I, I worked with it, so, but you know, like moving money around, I see like a big thing for that, especially internationally. And in Europe, they've been doing it for a couple of years. Here, it kind of stopped because of the tax situation, because the IRS classifies crypto in the United States— you can Google it on the IRS website— it's called a digital asset. It's not called currency. So they need to kind of say, okay, these are digital assets and the stablecoin we're going to call currency. So yeah, I think they need to fix that and then people might get more comfortable with the— with that.

It will happen. It will happen very soon, I think.

So any final— if people want to get in touch with you, they can find you on LinkedIn.

Yeah, so we are, we're at nilus.com, N-I-L-U-S dot com. You can visit the website, see what is it all about, the agents for treasury and for finance. You can leave your details and we'll get you onto a demo so you can see it in real time. Otherwise, I'm Daniel Kalish over LinkedIn and happy to chat with anyone and give you my advice on how to build and deploy agents for finance. So that's a pleasure to be here today, and I hope I'll see you in Miami soon.

All right. Well, give us some final words of wisdom, and then we'll sign off.

I would say just don't wait to go and go. And just like you need to— it's— I read a nice post today. It's AI or die. That's your time. AI or die. Just like deploy that, embrace that, and that's your time. Otherwise you might be in trouble. So that's my final word.

AI or die. I tell everybody, if you're not learning how to use AI, you need to. People, you know, like I was— somebody was telling me they lost their job because they said, well, you need to learn how to use ChatGPT. And the person was like, I don't even know what that is.

Correct.

You know, if you know AI and you keep advancing with AI and learning AI, you're going to advance in your business, your career, because everything is going towards AI. And that's today's podcast. We're talking about AI and how it's going to improve finance for businesses, and probably big businesses first, and then it's going to trickle down to everybody else. Because that's how it all starts. And, uh, AI or die, let's go. So, carpe diem. Thanks for listening to the B2B Vault today, the Biz to Biz podcast sponsored by Nationwide Payment Systems. You can find me on LinkedIn. You can go to nationwidepaymentsystems.com. You can go to follow B2B Vault on all the podcast networks. And thank you very much for Daniel for joining us today. From Nihilus, and his information will be in the show notes. Thank you very much, everybody.

Thank you.