All right. Welcome back, everybody. Very pleased to have Mike Praeger and Joel Wilhite joining us, CEO and CFO, respectively, from AvidXchange. Gentlemen, thank you so much for being here. Appreciate it. Thanks for having me. Thanks for having us. Macro is top of mind. Always top of mind, but why stop now? Give us your thoughts on sort of what you're seeing out there in the- Yeah ...in the marketplace. I'm just waiting for that one meeting today, when the meeting starts with something other than macro. Micro. But, yeah, I don't know. Joel, you may wanna. Do you wanna kick off on that? I mean, I'll just hit the highlights. You can sort of add some context. But yeah, so what it was another quarter of experiencing the same thing that we've sort of seen over the past, now, maybe five quarters or so, where we see, you know, our... We serve the middle market. So our middle market CFOs and controllers are being more cautious in their spending, and we see discretionary spending, in particular, being, you know, suppressed. And so, you know, our first quarter overall total transaction growth on the platform was about 5.8%, and we feel like that's missing out, you know, several points of growth associated with that discretionary spending. So we really haven't seen a meaningful change in our recent quarter than we had for the past four or five quarters, so continued caution. And, you know, one of the things about your story, I think that is an interesting edge that you have, is your sort of vertical market strategy. You know, maybe give us a little bit of an update on the different verticals in terms of, you know- Yeah how things are performing, and maybe also then after, give us a little bit of a read on what the future state of the vertical strategy might look like. Yeah. So, to kind of just bring back to the beginning, why we have the vertical market focus, and that is, we're laser focused and kind of purpose-built for the middle market. We define the middle market as companies between about $5 million of revenue, all the way up to $1 billion. And now, in the U.S. market alone, there's over 500,000 of these middle-market businesses. And we believe that roughly 50% of these 500,000 middle-market businesses actually highly align themselves to a specific industry vertical that has unique, either business process or accounting process, required in that vertical. And you know who these verticals are, because they have industry-specific accounting systems that support them. It's not the NetSuite of the world or Microsoft Dynamics, it's, you know, very specific vertical industry accounting systems. And so we, we like that... We, we like this market for kind of that approach, because it means that, it has unique business process, and if we can actually help solve, some of this business process challenge and create a value proposition for a particular vertical industry, there's a lot of value that gets created. And so we've now done that in nine different verticals, starting with, you know, kind of our oldest vertical, we got started, which is real estate. I'll come back to that in a second, because that's an interesting one. You have real estate, you have homeowner association or condo association management. A lot of big condo association managers in New York City, for example, use our platform. Construction, financial services, where we have roughly about 1,500 banks and credit unions that use our products today, to manage their internal accounts payable and payment process. We have healthcare facilities, education, nonprofit, and now our emerging hospitality vertical that we announced last year. So those are the, you know, kind of the industry verticals that we're focused on today, and we go to market both in a direct way, as well as leveraging partners. But to still today, you know, our direct sales activity is about, you know, 85%-ish of our overall, kind of customer, you know, new customer adds, and about 15% comes from the channel. We think the channel will grow to be about 30% over time, but we'll always be a dominant, you know, kind of direct, go-to market, you know, kind of direct sales force. So, come back to touch on real estate, 'cause it's an interesting one, 'cause I get a lot of questions about, "Mike, you know, it doesn't seem like, you know, real estate." Real estate's an interesting animal, in the sense that, it's, for us, it's really like six verticals in one. Because, you know, one of the things I kind of highlighted in our top-of-funnel activity is real estate. We actually really outperformed our expectations in Q1. And the reason being is because we saw tremendous activity in the multifamily sector, industrial, some retail. And so when you look at the overall, we look at kind of real estate. In, you know, on our platform, it's multifamily companies, industrial, student housing, retail, and then commercial office. So, so it's even kind of diversified within real estate per se. But certainly, you're seeing a lot of activity happen in the multifamily sector, and that also kind of leads into some of the new partnerships that I kind of highlighted recently with AppFolio. So moving forward, yeah, kind of the future of the verticals? Yeah. We think, we're just continue our strategy. You know, we'll continue to kind of grow the verticals that we're in. We like the approach of adding new verticals, when we naturally, organically get concentration of customers within a new vertical that are coming to our platform. That's how we launched, you know, our financial services vertical back a number of years ago, and then we kind of followed it up with an acquisition with BankTEL. We did the same thing, most recently in hospitality. We kind of pay attention when it's about 50 hospitality companies that have adopted our solution. And then when we got to about 100 hospitality-plus companies, we started doing, you know, started making decisions: "Hey, is this-- we're solving a real problem for these hospitality companies. Does it make sense now to create a dedicated market focus on supporting this vertical?" And the answer was yes, and part of our criteria is that we also wanna be highly aligned with the key accounting ERP providers that are so, you know, kind of the leaders for each of these verticals, which we've been successful in doing. And for the newest vertical in hospitality, M3 is a good example of that. So that's our kind of core strategy. I would say that we've also been very successful in supporting that strategy through an M&A acquisition, you know, kind of, you know, lens as well. And we continue to kind of be, you know, out there. We're talking to lots of people. In the last 24 months, we really haven't seen very many things that are either strategically really interesting for us, or at a price point that we like. But, you know, I expect that as we go into kind of the second half of this year, next year, we'll see, you know, kind of a rhythm of, you know, kind of routine tuck-in type acquisitions to support our vertical strategy, is what I expect. We've been hearing at the conference here the last couple days about maybe that bid-ask spread between buyers and sellers just starting to narrow a little bit, so- Yeah ... maybe that bodes well for availability of assets. I don't know. Yeah. Except for our friends at Corpay, who bought Paymerang, that seemed to be at a pretty healthy price, so- Maybe not. Not quite yet. So a follow-on question to what you just mentioned about verticals. What are the benefits to your model from going to market through verticals? Is it, you know, re- things like retention or- Yeah ... penetration or those types? Well, so first of all, I think it creates a very narrowed focus and a following. So for example, in some of, you know, our vertical markets, we have dedicated sales teams that are fully dedicated to those verticals. So we've developed, you know, kind of that thought leadership within the vertical. We're deeply integrated to all the supporting accounting systems of that vertical. So and it also, you know, is very targeted in terms of our marketing and go-to-market activities. And so in our kind of established vertical, like, I don't think there's not, you know, I won't say none, but there's very few deals that get done that we're not involved in because of our positioning within that vertical market and being a leader. And so if you didn't have that focus, it's really hard to be, you know, any substantial leader in a general, broad, horizontal, you know, kind of landscape, right? You know, it's really hard to kind of emerge, you know, and have any significant market share. But that's very... It's much easier in a smaller vertical market, where you can become that dominant, Justice Department doesn't like those words, but, that, you know, industry leader, right, in each of these verticals, and then you're kind of all your, you know, kind of, you know, customer acquisition costs and things like that, become really efficient on a vertical, you know, vertical by vertical industry basis. So, we like it from that perspective, and we think there's a lot of go-to-market synergies to that vertical focus. On the product side, you know, you guys have been building out, you know, new products, you know, AvidInvoice, excuse me, is one that we've heard a lot about. Maybe talk about the product, you know, evolution and roadmap. You know, you started with the AP product, where are you now? Where do you expect to be? Similar, similar question. Yeah. So one of the things I'll remind everybody, we made a big decision back in 2012, when we got into the payments business, that we said, "If we're gonna be really successful in building a two-sided network, we can't just think of it as a buyer customer, as the core customer. The supplier also has to become a core customer." You know, now, 12 years later, you know, I have a better appreciation of the ramifications of that decision in terms of how expensive it's been. But now, you know, what's funny is, you know, at the time we were doing it, we'd just done, you know. A couple years later, we did the deal with Mastercard, and at the time, Sachin was running B2B payments for North America. And so I did our deal with Sachin, who's now, you know, the CFO. And he said, "Mike, you know, you know, be careful because, you know, building a true network is, it's gonna be more expensive than you think it's gonna be, and it's gonna be much harder than you think it's gonna be. And you're not gonna be successful unless you really consider both sides that are core customers, and you take it seriously enough that you're actually building a value proposition and products for both sides." And I said, "Sachin, I gotcha. We have a plan. We can execute this," and. But he was right, you know? It's been harder and more expensive, but now we're starting to see that flywheel effect take place. And I think that's why we're starting to see this really, divergence about, you know, kind of our monetization, you know, rates and things like that, and how many, you know, over 40% of the transactions going through our platform are monetizing, is because we truly have a two-sided network with two, you know, very, specific customer sets, that we have very unique value propositions for both sides. And I think that's gonna continue to, you know, be the secret that, you know, continues to drive that monetization story for us. There's a few different growth components to the growth algorithm. One of them is further penetrating the, you know, the total payments flow into your system- Yep ... electronic payments versus checks. You know, help us think through, you know, the levers that you have there and the longer term view in terms of, you know, how do you, how do you- Yeah ... make that migration happen? So the thing about, just what I was saying about the kind of the two constituents of customers, building, you know, you know, kind of the products and value proposition for both of those is important. So on the buyer side, we continue to say, "Okay, what can we do to continue to get more of their transactions in our platform?" So one of the, you know, products that we, you know, talked about this meeting today, you know, release later this year to our initial group of customers, is our spend management platform. You know, kind of the Brex, Ramp of the world, very, but very specific for AvidXchange customers. Because customers tell us today, "Mike, okay, we have maybe 80% of, you know, all our expenses flowing through your platform, 100% of our expenses that relate to an invoice. But we have, like, 20% of our expense that doesn't relate to an invoice. It's maybe T&E, other spend that's more department level, emergency type purchases, things of that nature. It doesn't have an invoice, and, and it's in these kind of, you know, either manual systems or disparate third-party systems that aren't that well integrated into our general ledger. And so it becomes really hard to do, you know, global reporting and, you know, things of that nature. And so our mission is, how do we keep chipping away and get that remaining 20%, in our platform, so users also have a great user experience where, you know, they have one platform to go manage their invoice-related transactions, as well as their, you know, kind of T&E or other spend transactions? So that's what we're solving for on the buyer side in terms of that next level of innovation. On the supplier side, it's really continued to, you know, we're excited about Payment Accelerator, now that we've kind of made it a, you know, a generally available offering. Our marketing changed the name on it. I mean, it used to be Invoice Accelerator, now it's Payment Accelerator. But really excited about, you know, kind of that is clearly, to me, our next $100 million-dollar business, and, the kind of the third leg of our, of our revenue model to support our software revenue, or our payment network revenue, and then kind of our supplier financing component of it. And so those are kind of a couple of the next big innovations. And so certainly, we're excited about that. And then probably the biggest, you know, I think of it as this, you know, like, you know, untapped asset that we have, a raw material, that we have the, kind of the rights to, and that is this huge base of paper check transactions that we still haven't monetized. So roughly 50% of the transactions going through our platform are still paper check, and our ability to kind of convert those to electronic. And really excited about, you know, kind of the next, you know, kind of evolutions of our overall payment platform to really create, you know, unlimited different types of payment modalities to address the value proposition of what a supplier needs to move once and for all from paper check to electronic. And we believe it's a combination of four elements. One is the speed of payment or timing of it, the cost of the payment, the level of your remittance data for reconciliation, and then the level of automation. And so combining kind of those four elements and creating different payment modalities with those four, we think is the long-term secret of success of really, you know, keep chipping away at that, you know, paper check base. And then the kind of distribution or sales strategy, the base, is it a bit of a land and expand, where you're going to your existing customers in a kind of methodical way, saying, "Here, why don't you try this?" Or is it more of a pull, they're saying, "Hey, we need you to develop this." You know, how do you get these products to market? Yeah. I mean, so, it's a little bit of both on, you know, kind of, on the different sides of the equation. In the case of, you know, the, our core, buyer customer, we're still, you know, number one, very focused on introducing them to our core, you know, AP payment automation. Still, 95% of every new customer that, you know, begins working with us, is doing this for the first time. So we haven't gotten to the part of the market where we're displacing any legacy systems yet, right? So, so that's number one. And then it's like, okay, we have, you know, we have 8,000 buyer customers. We think, you know, a good number of those customers are gonna wanna adopt our spend management platform. And then the supplier side, you know, it's, it's continued to kind of, you know, again, create the right payment modalities. And then a big chunk of our supplier base are these small businesses, and we think our Payment Accelerator is the perfect product for that group. Cool. I usually left out here. Not for long. No, I'm just kidding. Looking at the first quarter, can you help us think through the spreads between transaction growth, payment volume growth, and revenues? You know, what are the variables there? How should we think about that, Wilhite? Yeah. So for the first quarter, we were about a 22% grower, 21 and change in total revenue. And we achieved that with about 12% TPV growth and 5.8% overall total transaction growth. So I think that's where you're going, is like, help us make sense of those different relationships. Exactly. Our total transactions on the platform is the sum of all the invoices and all the payments that the buyers are creating on the platform. And obviously, the subset of those transactions that are payments drives TPV. So the first thing that I would say is, if you think about the sort of 5.8% overall growth, about two-thirds of that volume is transactions and about a third is payments, but growing faster. And so I would say that the payment transaction growth corresponds well to that TPV growth. So if you think about within the 22% overall total revenue for the quarter, payments revenue itself grew about 27%, software 10%. So now we're thinking about that 27%, how does that relate to that 12% TPV growth? First thing I would say is about half of that yield is float driven, right? So we recognize revenue associated with the float on TPV on its way from buyers to suppliers. So if you take that float revenue out, you get to about an 18%. That 27% payments growth would be about 18%. And so now you're down to, okay, so apples and apples, then 18% revenue growth on 12% TPV growth, there's still a little bit of a spread, and that's really the expanding yield on overall payments that we're seeing on the platform. Again, back to Mike's point, increasingly capturing the digital payments, shifting from checks, and a number of other strategies that give us yield on that TPV. And on the float income side, have you guys had to kind of, when you put out your full year guidance, it's a bit of a moving target in terms of where- Right ...things might end up. It feels higher for longer, you know, ask me next week, and maybe I'll change my mind, but- Exactly. ...you know, how have you managed that, you know, thinking through that? Yeah. So obviously, the two big drivers are the customer balances themselves and the rates. And so in the quarter, we actually delivered, you know, better float revenue, a little better float revenue than we expected in a, you know, in a period where rates were constant. Our average customer balances were a little higher at March 31. It is entirely driven off of the business day that the period end falls on, and the timing of cash remittance from buyers to us on its way to suppliers, including an in-transit question. So customer balances are pretty tricky to predict, and so we, we got a little upside just from higher customer balances. We do have a rate assumption in the back part of the year that we really haven't changed since we gave initial guidance. It's like three reductions, 75 dips altogether. Who knows whether that actually happens? There'll be upside, obviously, if rates are higher for longer. But probably the bigger... You know, there's two meaningful variables. There's customer balances and rates. Both are tricky to predict. And you had another impressive EBITDA performance in Q1. Help us think through, you know, EBITDA trends and levers. You bet. Yeah, yeah. So we're proud of it, but it's sort of what we said we would do. So we're just kind of executing what we can control and really focused on driving sort of the key metrics, even absent float. Floats are great, you know, benefits drop straight through to the bottom, but it's why we're very transparent about our performance with and without float. We doubled that EBITDA performance in Q1 over Q4 ex float, and it's really just a combination of things that we've begun talking about. We sort of framed mid- and long-term targets in our Investor Day last year. We said we're super focused on driving gross margin. Gross margin expands as a function of that yield continuing to expand, but also driving down unit costs. We saw unit costs come down year-over-year from, like, $1.56 to $1.51, and we have strategies to kind of bring that even further down, while also continuing to expand yield. So it's gross margin, and then it's also beginning to see leverage in the operating expenses. So we're focused on balancing the growth we know is ahead of us, but also kind of running in a pretty disciplined way and delivering on the EBITDA targets that we've talked about in Investor Day. Mike, competitive environment, what does that mean to you? Well, you know, it's interesting 'cause, you know, I kind of look and I actually think it's interesting environment that we're in today, because there's less actual, you know, individual competitors than we had, you know, three, four, five years ago. And the reason being is because we've seen very, you know, few new startups, you know, come into, you know, the middle market, you know, related to AP and payments. And there's been a number of players that have left the market through M&A. And, you know, for whatever reason, you know, on the M&A things, they became, you know, the handful of examples that we've seen, you know, they just their market presence kind of wanes. Probably there's a big transition from domain knowledge of the either leadership of those acquired companies that leaves. And so we just find it being, you know, significantly less competitive, you know, post M&A. Having said that, you know, it's still the number one competitor that we're facing every day is not another company, it's the status quo mindset of, you know, when a company is gonna be ready to, you know, change its business process, move from paper, you know, paper checks to electronic, you know, paper invoices to electronic invoices. And so that's the biggest, is still competitor that we kind of have, you know, every day. Now, having said that, you know, yes, there is competition, and but it's very, kind of, you know, vertical market focused than typically who our competitors are. I really don't have any good examples of a competitor that may actually cross over, you know, multiple verticals. You know, I saw, I think, you have some on the private company side, a company like Tipalti, you know, here at the conference. And that's a good example of somebody that, you know, we see in the horizontal market, typically, like in the NetSuite channel, where the majority, 50% or more of the transactions that a company may have are international cross-border related, and that's where we'll see them from a competitive standpoint. But in terms of like, you know, go to business in the middle market, U.S. domestic, across our verticals, you know, we don't see somebody like a Tipalti. And so, it's that type of market. It's not like, you know, the SAP, you know, kind of Oracle days where, you know, Workday, where it's the same three competing on every deal. It's not that at all. Is it, is it still very much more like a greenfield- Yeah. You're competing with spreadsheets and old- Yeah. Still only 90%-95% of our new customer acquisitions are companies that are doing this for the first time. I see. Yeah. And, you touched on this a little bit earlier, but what are your latest thoughts on sort of M&A and maybe accelerating your strategy via M&A? Well, I think, you know, we really like our product feature sets that we have for our applications. And I think we believe that we're unique from the standpoint that, like, all of our, you know, kind of products are very, you know, kind of interconnected with each other, related to, how we store data, how we manage workflows, how we manage our payment network. And so kind of a, you know, additional components, we just found, like, spend, like, management as an example, it's just more efficient for us to kind of build those features on our platform ourselves. So we don't really look at it from a feature product perspective, but we do look at it from a customer acquisition, vertical market acquisition perspective. you know, it's not like we're not trying, we're talking to lots of people, but we just haven't found things that have been either that strategic or at the right price. I think we're very focused, especially as a, you know, a newer vintage public company, you know, we're not gonna do anything that's not accretive, you know, super accretive to our shareholders. And so, you know, we've been very disciplined around that approach. I think there will be opportunities for us to take advantage of, you know, whether it be later this year or going into next year. But again, we're gonna be really smart about it. One vertical that I get questions about from investors, for good reason, is political and media spending. Yeah. Talk about what you do for customers in that vertical, and then maybe what your- Yeah - expectations are, and if you're seeing any, you know, beginnings of the, Yeah - season. So, first of all, I would say, you know, the media vertical is actually one. I kind of think of it as it's like two different businesses. It's regular media business, where our customers are, you know, advertising agencies that, you know, are paying advertising-related bills on behalf of their customers for media spend that they're doing. And whether it be like a, you know, a Dentsu that operates, you know, kind of in global brands or, you know, kind of more, you know, regional type a advertising agencies. At the same time then, so that's kind of like the core business that's pretty consistent. You know, it doesn't have ebbs and flows, you know, throughout, you know, kind of throughout the year or year to year. It operates and feels more like our other industry verticals. And then you have the other side of the media vertical, which is political. And that's a unique animal in itself, and so in terms of that, it's that we became the leader in it by the nature of our ability to execute, you know, different flexible payment modalities and in a real-time basis. And because what had happened back a number of years ago is a number of, you know, advertisers have kind of got burned by, you know, campaigns and issue groups where they were doing it on credit, and after the election ended, they didn't have the credit to pay their advertising bill, right? And so now it went to a prepaid model, and so in order to do any political advertising, you have to prepay for it. Well, in the world of these short decision-making cycles, people don't want to wait for a paper check to arrive before they can run, you know, say, a campaign ad, right? And so we became, you know, very quickly the industry leader in political media payments. But what makes it unique is, it's hard to have visibility to it because it's such short-term decision-making. And we have a nice bump in revenues, you know, every other year, certainly in the kind of interim cycle and then in the presidential cycle. So, then we believe, in the industry today, that we, you know, for political media, that we control about 30% of all the payments that get made that go through our platform. And this cycle, it's forecast that it's gonna exceed, it's gonna be the first $10 billion dollar, you know, political payment cycle, or spend cycle, I should say. And some of the reports are kind of bracket it between $10 billion and $16 billion. So it's hard to say what, you know, where we're gonna, you know, shake out within that spectrum. But it's a nice, you know, kind of bump to our business that we have every other year. Do you expect it to be quite back-end loaded in terms of the year? Yeah. So typically, they're very back-ended. I think our forecast is, it's like, you know, we'll see about 20% of the spend first half of the year, about 80% the second half of the year, and a lot of it gets, really starts ramping up, our expectation, will happen after Labor Day. Okay. And then. Or maybe with the, you know, the new debates happening in June, who knows? Maybe, maybe that cycle gets expedited. We'll see what we want. Well, I think we're just about out of time. Thank you so much for the great conversation. I appreciate it, gentlemen. Yeah. Thanks for having us. Thanks. Always a pleasure.