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On July 1st, 2025, Flagship Advisory Partners co-hosted an event with UBS in London, where Anupam Majumdar, Partner at Flagship, presented on the rising wave of B2B and Office of the CFO SaaS innovation in Europe, highlighting its evolution in relation to the more mature US fintech landscape. We advise viewing the slides via the "PDF" icon button. Some Key Takeaways: B2B payments represent a substantial $135 trillion in volume as of 2023, which is 2.5x larger than the C2B segment. In contrast to C2B payments, where payments between consumers and merchants tend to be rather simple (often a click of a button or a tap of a phone), B2B payments between buyers and suppliers are significantly complex, often involving a series of workflows. Today, there are several pain-points in the buyer-seller transaction flows. However, these pain points offer opportunities for value creation through automation, digitization and embedded fintech, simplifying the naturally complex B2B transaction flows. B2B CFO workflow automation SaaS platforms continue to demonstrate strong linkages with payments and fintech, viewing embedded fintech as a strong driver of monetization and growth. The embedded finance maturity for B2B SaaS varies by region and functional orientation, yet overall, more mature in the US. In the U.S., companies such as BILL and AvidxChange offer successful examples of mature embedded finance strategies in B2B SaaS, having expanded their payments and fintech revenues from 2021 to 2024. B2B fintech and SaaS in Europe are still emerging relative to the more mature US market, with a fragmented ecosystem that continues to rely heavily on traditional bank transfers. However, market consolidation, and funding / M&A activity across the European of CFO Stack, as well as upcoming B2B e-Invoicing mandates will have an impact on B2B fintech and SaaS in Europe. Payments acceptance is only the starting point. Over time, successful platforms evolve to deliver new embedded finance use cases and products that go well beyond payments (e.g., into embedded lending, x-border payouts). There are a wide variety of opportunities for every stakeholder who are involved in the value chain – banks, fintechs, B2B SaaS and card schemes. Please do not hesitate to contact Anupam Majumdar at Anupam@FlagshipAP.com with comments or questions.

Introduction Software platforms (ISVs or SaaS or SW companies) are rapidly expanding into payments and embedded finance, capturing more and more of the fintech value chain. In the U.S. market, we estimate that ISVs (independent software vendors), in various forms, already control 35% of the SMB merchant payments revenue pool. In response, payments service providers (PSPs) are evolving their strategies, increasingly focused on acquiring commerce software to control the full SMB product bundle. This motivation for payment companies to own commerce software is visible in recent M&A activity. What began in the U.S. with payment companies such as Global Payments, Shift4, and Fiserv is now accelerating in Europe (as shown in Figures 1 and 2). In this article, we review M&A activity along this theme and explore the strategic rationale and challenges for PSPs acquiring software assets. U.S. Trend Of PSPs Buying Software Accelerating in Europe Figure 1: US Payments + Commerce SaaS M&A (non-exhaustive; US Targets) As shown in Figure 1, there is a long list of U.S. merchant acquirers (PSPs) that have pursued software M&A over the last decade. One of the earliest and most notable examples is Heartland, a leading direct-selling POS acquirer in the U.S. SMB segment. Heartland’s direct sales approach faced pressure from ISVs working with PSPs to bring integrated bundles to market. Rather than embracing ISVs as a channel, Heartland maintained its direct distribution focus but acquired a series of software assets to better position for software-led product bundles, acquiring a series of software assets from 2011 to 2015, at which point Global Payments acquired them. After acquiring Heartland in 2016, Global Payments continued to scale this strategy, extending its software M&A well beyond POS-centric verticals and into more specialized verticals such as practice management and recreation/events. Global Payment’s recent pullback from its broad vertical software portfolio (e.g. divestment of Advanced MD) suggests that this strategy stretched too far from the group’s core of merchant payments. Shift4 is another example of a U.S. merchant acquirer using software acquisitions to go-to-market via its own distribution. Shift4 acquired multiple commerce software assets in hospitality, venues, and charitable giving while also developing its target Skytab POS platform. The strategy for PSPs to acquire commerce software is gaining momentum in Europe. As shown in Figure 2, we see an increase in PSPs acquiring commerce software. Recent examples include myPOS acquiring Toporder, a French specialty retail SaaS provider; Shift4 acquiring Vectron, a pan-European restaurant platform; and Sipay’s acquisition of Pikotea, a Spanish restaurant SaaS. Planet, a market leader in accommodation, hospitality, and retail payments, acquired a series of software companies in recent years to bolster its full-stack offering across those verticals. Figure 2: UK & European Payments + Commerce SaaS M&A (non-exhaustive; UK & European Targets) PSPs Face the Choice to Partner or (and) Own Software Not all PSPs have the strategy to own and market software. Many PSPs focus principally on partnering with software companies, powering integrated/embedded payments. While it is a strategic choice to emphasize owning software vs. partnering with software, these choices are not mutually exclusive. Some PSPs are successful doing both. As shown in Figure 3, both strategies - partnering with ISVs or owning the software stack - come with distinct rationale and success factors. Both strategies can be successful with the right focus and investment. Figure 3: Pros and Cons: Partnership-Led vs. Owning the Software (non-exhaustive) Becoming the payments partner of choice for ISVs / SaaS platforms offers greater scaling pace as it’s a one-to-many marketing outcome when successful (vs. selling each SMB merchant). Particularly in Europe, where the ISV ecosystem is fragmented and less mature, we expect rapid growth in embedded payments over the balance of this decade. The key challenge with relying on only software partners for product bundles is that the software providers seize share of the economic pie over time, owning more than 80% of the merchant payment economics at scale (e.g., billions of payment turnover). Owning software, on the other hand, provides greater long-term ownership of the lucrative economics inherent to the SMB segment. However, owning the software only matters if you can learn to sell and develop it. Owning and going-to-market with software requires a fundamental shift in organizational and cultural DNA for payments companies, however many have struggled with this transformation. As mentioned, it is also possible for payment companies to both own software and partner with software companies for embedded payments. Success with both GTM strategies requires a balance of the potential conflict. Many leading U.S. PSPs partner with ISVs who provide more vertically advanced software to larger SMBs while marketing their own simple POS software into smaller SMBs. In this case, the vertically specialized SaaS companies generally do not see simple POS software as a threat. Critical Success Factors for a SaaS-Driven PSP Strategy Just as software platforms must learn to sell payments and embedded finance, PSPs must learn how to sell software. Selling simple POS software requires adaptation, but the small SMBs that purchase these bundles tend to exhibit simple buying behaviors similar to stand-alone POS payments. Selling more advanced vertical software requires greater transformation as GTM success requires coordinated multi-channel marketing, technical sales, and patience to navigate a sales cycle that takes weeks or months. Owning software is not simply about adding a new product, it is about reshaping how you acquire, serve, and grow your merchant base. Below we outline four successes for PSPs that want to own (market and develop) commerce software. Software is your anchor product, you aren't just selling payments: For SMBs, business management software is the primary and generally first purchase. It is the brain of a merchants’ business. Payments (and fintech) is a secondary purchase. PSPs must understand their software offering deeply: its value proposition, pain points solved, and how it fits into the day-to-day operations of target merchants. Software sales require more multi-channel marketing, conversion selling, and success management: Commerce software is a more complex product than stand-alone payments, often requiring more marketing touchpoints to establish a conversion opportunity and then more work to convert and drive merchants to sustained activation. Digital engagement is a must: Digital engagement for sign-up, for boarding, for servicing, and for cross-selling is the key success factor to optimize merchant lifetime value while minimizing cost to acquire and serve. You have to have a solid digital experience to win in a software-led world. However, once you master digital engagement, software product and customers are naturally more digitally engaged, allowing for easier cross-selling. Software bundle merchants are twice as likely to use another embedded finance service (beyond payments) than stand-alone payment merchants. Data is powerful – unlocking significant monetization potential: Combining software and payments unlocks powerful data. Even market leaders are early in the learning curve for monetizing this data, but the potential is massive, for example with AI powered digital advertising linked to measured customer loyalty success. Acquisition Integration: And finally, do not underestimate the complexity of integrating a software company into a payments company culture. Software companies tend to have different DNA and cultures (more technical, more remote, etc.) and squashing such culture is a major pitfall. Conclusion: A Strategic Crossroads for PSPs Buying software marks a fundamental shift in the role PSPs play in the commerce stack. It changes how you acquire customers, how you retain them, and how you monetize merchant relationships. The partnership model [being the payments partner of choice to the ISV/SaaS] continues to be a highly effective strategy. But as competition intensifies on the supply of embedded payments, owning software can be a pathway to sustained capture of the SMB economics. We expect to see more PSPs both acquire and partner with software as the days of stand-alone payment services fade away. Please do not hesitate to contact Charlotte Al Usta at Charlotte@FlagshipAP.com, Francesca De Fina at Francesca@FlagshipAp.com or Tobias Vink at Tobias@FlagshipAP.com with your comments or questions.

This snapshot marks the first in our Embedded Finance Vertical Snapshot series, beginning with a focus on the US Healthcare Providers landscape (excluding payment to payer payment flows). The healthcare sector is notably complex and highly regulated, with widespread software adoption driven in large part by US electronic health record (EHR) mandates. Despite this digital maturity, the embedded finance ecosystem within the vertical remains relatively nascent, with significant room for growth. We see meaningful opportunity for fintech solutions to expand, particularly in patient payments, provider payouts, and financial services integration. Sizable embedded payments market: The vertical is associated with a large and stable card payments volume pool with potential for growth. For example, card acceptance has become order qualifying for healthcare software, but most patients still pay in other ways. High software usage: The healthcare sector is undergoing continued digitization, with approximately 85% of medical providers now using practice management solutions. Moderate embedded lending upside potential: The vertical offers the potential for business and consumer lending, buoyed by provider profitability constraints and an increasing cost of care. Fragmented, but consolidating software market: The provider landscape is consolidating, led by acquisitions from hospital systems, private equity, and large tech companies (e.g., Amazon). 1. Vertical Definition 2. Vertical Spend - US Healthcare Providers Revenue (trillions of USD, 2022-2026) 3. Vertical Dynamics (all sub-segments) 4. Software Landscape - Practice Management / Billing / EHR Healthcare providers often use multiple software products, creating competition for embedded payments and finance. Practice mgmt. and billing modules are the most common payment integration points. Practice mgmt. solutions are increasingly expanding into other software adjacencies (e.g., EHR). Sub-verticals (e.g., dentists, veterinarians, etc.) have specialized software needs and vendors. 5. Embedded Finance Monetization Maturity in the U.S. Embedded Fintech Highlights Most payments are made via insurance, which is more challenging for SaaS to monetize, there remains high volumes of ACH/check, but card acceptance and usage is growing rapidly. Embedded e-billing, POS payments, and consumer financing are the most mature embedded fintech products. Consumer financing is often offered for large patient payments. We also see potential growth in embedded pay-outs (in various forms) and business financing. Please do not hesitate to contact Peter Taylor at Peter@FlagshipAP.com or Amilee Huang at Amilee@FlagshipAP.com with comments and questions.

Introduction The B2B mobility ecosystem continues to evolve rapidly, underpinned by favorable macro factors: huge volumes, unmet customer needs, complexity, and technological innovation. It now encompasses fuel and energy cards, fleet management software, specialized mobility services such as driver and fuel management, route optimization, and field scheduling, among others. To gauge the current state of activity levels in the B2B mobility ecosystem, Flagship examined the press releases of a representative sample of 39 companies from 7 different provider types for a recent 12-month period, and we highlight the results below. Figure 1: Press Releases per Category (number of press releases as advertised on global website, Jan’24 – Feb’25) Overall activity levels in B2B mobility are high. Between January 2024 and February 2025, our sample of 39 mobility providers issued 286 press releases. Most press releases focused on new product/feature launches (27% of total), new client announcements (21% of total), product partnerships (18% of total), and distribution partnerships for electric vehicle (“EV”) charging (12% of total). Announcements for other types of distribution partnerships (e.g., for traditional and alternative fuels) were less prevalent. Figure 2: Press Releases per B2B Mobility Provider (number of press releases as advertised on global website, Jan’24 – Feb’25) EV Charge Point Operators (CPOs) were the most prolific in terms of number of announcements, with the EV CPOs in our sample making 79 announcements, of which 41% were related to new clients. Fuel card providers followed with 71 press releases, with a more even distribution of announcement types. More Frequent Type of Announcements: Product/Features Figure 3: Press Releases Announcing Product/Feature Launches (number of press releases as advertised on global website, Jan’24 – Feb’25) Product/feature announcements were the most prevalent announcement type: Fleet Management Software (FMS) providers were the most prolific, with announcements focused on integrating AI into route optimization and operational efficiency tools, EV integration, and safety tools. EV CPOs announced new solutions to improve the charging experience both at home and en-route (e.g., enhancing the architecture, charging solution for commercial vehicles, omni port adaptable charger, etc.) Fuel card providers and auto manufacturers (“OEMs”) announced new products/features (especially related to EV and alternative fuels), in-car payments, and safety solutions for drivers New Client Announcements Figure 4: Press Releases Announcing New Clients (number of press releases as advertised on global website, Jan’24 – Feb’25) EV CPOs released the highest number of new client announcements, as they sought to highlight expansion of EV charging infrastructure with both private and government clients. Other provider types had markedly fewer new client announcements. Fintechs made announcements regarding new clients for core and expansion use cases, OEMs expanding their reach in EV and driverless trucks, and FMS announced new government agency clients. Product Partnerships Figure 5: Press Releases Announcing Product Partnerships (number of press releases as advertised on global website, Jan’24 – Feb’25) Announcements regarding product partnerships were more evenly distributed: FMS providers announced partnerships that embed with OEMs and fuel systems to centralize data on vehicle status, maintenance, and telematics OEMs partnered with energy providers, AI developers, in-car payment providers, and EV CPOs to push towards higher adoption of EV and vehicle digitization Fuel card card providers partnered to continue in their push to expand from traditional fuel offerings into digital payments, EV integrations and retail services EV CPOs announced partnerships to enlarge and enhance their networks with faster, more reliable, and more accessible charging solutions EV Distribution Partnerships Figure 6: Press Releases Announcing EV Distribution Partnerships (number of press releases as advertised on global website, Jan’24 – Feb’25) Fuel card providers, EV CPOs, and OEMs have been actively investing in EV charging infrastructure expansion and customer experience enhancements. Collaborations between OEMs and EV CPOs are becoming increasingly common, with the goal of accelerating the deployment of faster and more widespread charging stations. Additionally, fuel card providers are forming strategic partnerships with EV CPOs to expand merchant network coverage and to distribute co-branded EV charging cards. Figure 7: Fuel Card Providers Press Releases (number of press releases as advertised on global website, Jan’24 – Feb’25) Fuel card issuers continue to highlight their efforts to expand into EV and sustainability (DKV announced 12 EV distribution partnerships) and alternative fuels, while continuing to partner for fuel distribution (DKV 4 press releases, UTA 6). Fuel card issuers continue to expand geographically (UTA published 3 press releases on the topic, Eurowag, DKV, Radius and Wex 1) and enhance card functionalities (Eurowag and Comdata published 4 press releases each on new products/features, Wex 2), particularly in areas such as in-car payments, seamless EV charging access, and integration with digital payment ecosystems. Conclusion Using press releases as a proxy, activity levels in B2B mobility continue to be high across categories. Payments and fintech underpins or is relevant for many expansion initiatives in the space, and therefore B2B mobility continues to warrant consideration by investors and financial sponsors, different types of fintechs, and software providers. Overall, the topics with the highest announced activities clustered around EV and software, but even “traditional” mobility is still an underpenetrated area in payments with many opportunities for expansion by specialists and non-specialists alike (e.g., why don’t banks offer basic mobility solutions for their huge numbers of SMB customers, many of whom have small fleets?). Although recent macro trends in the mobility space indicate a pullback or at least slowing growth in EV generally, the overall B2B mobility space remains robust and activity levels create a call to action for all types of fintech and payments providers: most types of fintech and payment providers should assess B2B mobility for suitability as a target vertical, and many will have opportunities to grow in the space. Please do not hesitate to contact Erik Howell at Erik@FlagshipAP.com with your comments or questions.

The European office of CFO SaaS remains a fertile ground for investments and M&A. Rapid market consolidation across CFO SaaS domains, key regulatory mandates (e.g., B2B E-invoicing) and increased adoption of embedded fintech across SaaS domains makes the space an attractive investment hotbed. We advise viewing the slides via the "PDF" icon button. General Commentary & Highlights The ‘Office of CFO’ SaaS spans across several segments and operates in a highly fragmented European market today (e.g., accounting & ERP, treasury, cash management & financial planning, AR & e-Invoicing, payroll, AP automation & spend management) CFO workflow automation SaaS continue to demonstrate strong linkages with payments and fintech, seeing embedded fintech as strong monetization growth levers Recent M&A in this B2B "Office of CFO' SaaS segment demonstrate the ongoing convergence between CFO software and B2B fintech services (payments, lending, FX, other). For example, ThomaBravo invested in Coupa and Bottomline to create a global integrated B2B automation + payments powerhouse New regulatory mandates are likely to lead to increased uptake of workflow automation and process digitization: One-Stop Shop (OSS) for VAT Registration: Creating a single VAT registration system to enabling businesses to manage their tax obligations throughout the EU Digital Reporting Requirements (DRR): Standardize e-invoicing processes and exchange of VAT info across the EU Platform Economy: Enhance VAT collection for digital platforms (short-term accommodation rentals, passenger transport etc.) New European (EU) regulatory mandates are likely to lead to increased uptake of workflow automation and process digitation Please do not hesitate to contact Anupam Majumdar at Anupam@FlagshipAP.com or Niko Berank at Niko@FlagshipAP.com with comments or questions.