Thanks, everyone, for joining m y name is Alex Markgraf. I lead the FinTech and Financial Software Research team at KeyBanc. Very excited to have the AvidXchange team here with us, Mike and Joel. So, we'll kick right off. We have about 25 minutes, so, we'll stick to maybe 20 minutes of Q&A, and then I'll open up to the audience if there are any questions. Mike, do you want to start with just a quick background on AvidXchange? Absolutely. The 1-minute elevator pitch. Absolutely. Yeah. So, when you think about AvidXchange, we automate the accounts payable and payment process for middle market companies. And so kind of the operative word is around the middle market. We define that as companies between $5 million in revenue and $1 billion. And just in the U.S. alone, it's about 525,000 middle market companies. And what's made us kind of our secret sauce is really having a highly integrated software suite that automates everything from the purchase order through the invoice and then through the payment with our payment network, which we launched in 2012. What we do in the payment network that makes us highly unique is that we consider the supplier, our core customer, like the buyer, which means that we deliver a value proposition to that supplier that relates to managing their business rules on the network in terms of what types of payment modalities they want to take under certain characteristics, along with all the different payment modalities that we offer, combined with cash flow management tools. So, that's the value proposition for the supplier. Today, we have over 8,000 buyer customers that are on our platform, manage their accounts payable and payment process, along with over 1.2 million suppliers submitting invoices, receiving payments, and receiving kind of that value proposition related to remittance data, cash flow management tools on our platform. And how we go to market is one of the things that's unique about the middle market is we estimate roughly 50% of the 525,000 companies in the middle market just in the U.S. highly align themselves to an industry vertical. That has unique either business process or accounting system process to that vertical a nd you kind of know who they are because they're supported by vertical-specific accounting systems. And so, we go to market today in nine different industry verticals that we go very deep that have some form of unique business process. And then we also cover what we call the horizontal, which is typically the NetSuite, Microsoft Dynamics, Sage Intacct, Acumatica type of market that we also cover. And so, yeah, we've been at this since 2000. So, we've seen certainly some cycles occur over the last kind of 24 years. But, we've continued to build a pretty big moat around kind of that Middle Market segment and just focus on keep executing, adding buyer customers and supplier customers every quarter. Okay. Joel, before we get into some of the meatier questions, you just want to give a recap of earnings last week for everyone? You bet. Yeah. So, we announced, honestly, a really strong quarter w e were slightly off implied guidance or consensus w e don't guide the quarter. We just update our guidance on the full year. But, $105 and change, so 15% growth year-over-year. A slight sequential step down from first quarter given the float dynamic. So, on an ex-float basis, about a 13% growth year-over-year and continue to do the things that we've committed to so, gross margin expanded overall to 73%, over 400 basis points expansion e ven removing float, we're seeing good underlying discipline and expanding gross margins on their way to just under 70% right now and on their way to 75+%. So, good quarter, top line, bottom line, meaningfully exceeded on the bottom line. First GAAP profitable quarter and about $20 million free cash flow on the quarter so, really seeing good progress from a profitability perspective. And year- over- year, seeing good overall fundamentals of volume growth, so, total transactions processed and yield generated on that. So, our yield generation year- over- year was about a 4% overall transaction growth or transaction yield expansion a nd our volume growth was about 4.8% on the quarter, slightly down from the Q1, which was about 5.8%. But, we've been talking now for six, seven quarters about the impact on our customer base in exercising caution on discretionary spending. So, we've seen that dynamic continue, maybe a touch worse in Q2. But overall, a solid quarter, definitely delivering on our profitability. We did adjust our sort of back half of the year guide given the incremental worsening from a volume process standpoint. While continuing to see meaningful overall TPV yields, which is basically our payments revenue over all the money we move between buyers and suppliers, it's been in the 30 basis point range for some time. We saw some behavior on the suppliers that just made us a little more cautious about the yield expansion that we'd see in the back half together with the overall total transaction volume. Overall, good quarter and on track with kind of the key profitability metrics and just still looking for the macro kind of to turn around and give some relief on the top line. Let's stay on that topic for a second i think it's everyone's favorite topic in the last week or so. Mike, you said 24 years. You've seen some cycles. What does this one look like relative to some of the others you've seen? And I'm not going to ask you to say when it ends, but just maybe offer some perspective on that. I was going to ask you when it ends, actually. Yeah. So, we have seen a bunch of cycles l ike all these cycles, no two are exactly alike. Sometimes some of the early cycles, it's actually hard to remember what happened b ut, some of them are pretty vivid for me. What's happening this cycle is very consistent to what we've seen in the past. That is middle-market companies, many of the leaders in their segment, they don't go out of business on a down-market. They cut back on discretionary spend, manage their business more efficiently. Then when they have visibility to the other side of the cycle, that discretionary spend usually comes back pretty quickly. So, this cycle is kind of operating very similarly. We have really resilient customer base. We don't see any customers going out of business, which sometimes happens in the small business segment. Small business customers do go out of business. But, for our customers, they're just being more aggressive in managing that discretionary spend element. And I'd say we've been now in how many quarters we've seen some of the macro pressure. So, it's been, yeah, about 6+ quarters. So, maybe it's kind of getting towards the end of where we've seen other cycles. I personally spend a lot of time on customer engagement, talking to our CFOs, CEOs of our customers. And, the kind of resounding theme that I hear about from a lot of them is there's just another layer of uncertainty right now with the whole presidential election cycle. And, people say, "Hey, we just want to get through the election, just understanding what our president's going to be, but, then what corresponding policies are going to be, have better clarity in terms of the rate environment." And so, we'll see. But, maybe those two things are somewhat of a catalyst to give some of that confidence to have the discretionary spend come back as we go into 2025. But, certainly, we're being aggressive in managing the things that we control. And I think that's where you should have seen it in our numbers in terms of continued expansion of our gross margin, along with really doing well on the profitability side. That's sort of the spend side of the cycle. Talk a little bit about demand and what you see from a logo-add standpoint. Is there any volatility in that as you go through these cycles? or is it pretty steady demand from mid-market? Yeah. I mean, we've seen kind of pretty consistent steady demand. One of the things I kind of talked about in the call is, although we've had some strategic shifts in how we go to market and some of our top-of-funnel activity, net logo growth is up over last year. And we report those numbers on an annual basis. So we're seeing it. And, one of the things that we're also seeing is pretty consistent demand across all nine verticals. And, one of the ones that kind of I get asked about a lot is our real estate vertical, which is where we started in 24 years ago. And, certainly, one of our it's been one of our key verticals over the years. But, even real estate this past quarter was actually a high performer. Because when you look at it, there's many different kind of segments of the real estate vertical led by multifamily housing, student housing, industrial, retail, and commercial office. And certainly, multifamily, campus housing, industrial have all been performing really well over the last couple of years, while maybe there's some sluggishness on commercial office in terms of new customer adds. But, when you go across all our nine verticals, we get really diversified customer experience. Just to sort of shift to competition and the go-to-market motion, maybe spend a minute on why AvidXchange is winning versus mid-market peers a nd then, to the extent you see folks sort of down market, up market from you, what the differentiation is? Yeah. It's pretty simple. Why we win is we deliver a highly integrated suite of AP automation tools. That is directly kind of integrated to execution of their payments and our AvidPay network, combining the software along with the payment network in a highly integrated way to their core accounting general ledger system. So, today, we're integrated to about 240-plus different accounting ERP systems. And one of the complexities is our average customer utilizes like 2.7 accounting systems. So, having to be able to be highly integrated and manage a dynamic accounts payable and payment process across multiple accounting systems is kind of one of the key ingredients of why we win. And then the second one, which is kind of our secret sauce, is our ability to just continue to lead the industry and have outside monetization of electronic payments. So today, we're monetizing about 40% of all the payment transactions going through our network. And, that's usually multiples ahead of anyone else we see in the market. And, the next usual question is like, "Well, how do you do that?" And, the number one reason is because we consider the supplier or customer developed a value proposition. So, they're on our network for reasons, other than just receiving a payment. When I think about the peer set for you all, there are other AP automation providers. There are also spend and expense management providers that have sort of started to dabble in AP/AR. You guys have sort of started to do the inverse. Talk about how you see this developing and sort of that fuller back office suite of financial solutions. Yeah. So, one of the things just on the competition side, over the last couple of years, and especially as the macro has gotten more challenging, there's actually less competition from another company perspective. We really see kind of no new startups and probably from the capital perspective, but also, around money transmitter licensing, which is extremely now time-consuming, expensive, and just takes a lot of time to get licensed properly in the 48 states or so that require it. And so, what we see is from a competition standpoint, hands down, number one competitor is still the status quo paper-based process. Managing paper invoices, paper checks is the number one competitor. And then, what we see as kind of the other kind of third-party competition is really Vertical-specific. So, kind of an AP automation company we see in one Vertical, typically they're only in that one Vertical t hey don't cross over to multiple verticals. And so, each vertical has its own set of unique kind of typically software competitors. But again, what makes us unique, we bring the software combined with the payment network. And that combination is what makes us kind of part of the winning formula. What was the second part? The spend and expense. Oh, the spend and expense. Yeah. So, one of the things that we talked about is that we're getting ready later this year to release our Avid Spend Management, which is designed for kind of middle market companies. And, kind of the direct problem that we're trying to solve is customers coming to us and saying, "Mike, we have 100% of our invoice transactions on your platform because you directly feed our general ledger. AvidXchange is a system of record for all of our expenses. But, we have like 15%-20% of our expenses that don't have invoices." And, these are kind of managed outside the system, maybe third-party applications like a T&E system for travel and entertainment expense. It could be other subsystems or just managing in paper. How do we get these expenses? in your platform so, there's one system of record, one user experience to manage all of our expenses? So, that's what we're solving for, is that remaining kind of 15%-20% that doesn't go through our platform today. Kind of excited to be in the market with it end of the year so, we can kind of begin kind of scaling it as we go through 2025. From a go-to-market standpoint, you all have pushed on the partnership front quite a bit lately. A couple, more than a couple, notable partnerships that you announced recently. Talk about what that represents in your channel and sort of what excites you about that, what the pipeline looks like? Well, so one of the things we've been kind of focused on, and it's actually been driven by demand. The demand is accounting system, ERP systems coming to us and saying, "Hey, we have a baseline AP module in our ERP system. But, if customers want a more automated electronic solution, we'd like to partner with you to offer that as an option." We've seen significantly increase in demand in ERPs coming to us for those type of solutions. So, it's turned out as really a great channel w e're up to now 200 overall partnerships, specifically some great kind of the industry leaders in our different vertical segments. So most recently, talking about AppFolio within the multifamily segment has roughly 40,000, I mean, some 20,000 customers. Half of those, we think, may be the right product-market fit for our type of solution. So, big customer segment to go after. M3 in hospitality, same thing, maybe 1,500 customers that meet our target profile. And then most recently, Buildium that I talked about, about 3,500 customers that meet our target profile. So, those are some good examples of going to market a nd what we've kind of realized is, that the lead quality that being generated by these partnerships is significantly better and higher quality than, say, the digital demand channel that you get large volume in, but, you have to sift through it to get the quality. What we're getting is really high quality b ecause if you think about it, these are already existing customers that are on our ERP partner system. And they're like, "Hey, I want to expand my usage and automate this business process within my ERP system." And so those are great, really high-quality leads that we're able to generate. For most of these partnerships, actually, it's what we call kind of a referral/reseller model that our sales team actually leads the sales process in partnership with our partner salesforece. So, they're on our paper. We manage the sales pipeline and funnel. We like those type of partnerships where we're in direct control of the sales activity, versus we also have some white label, which are great partnerships, but, we're kind of one step removed, as we're supporting our partner in those scenarios. But, we like the scenarios where we drive our direct sales team drives the sales process. Joel, maybe two things, the ramp of some of the partnerships that you have announced, and then just how the economics look the same or different from the direct channel. Yeah, yeah, yeah. Well, Mike and I'll tag team that i think we've said that the portion of that kind of addressable, the addressable subset of those customers, whether it was the 10,000 of the 20,000 in AppFolio's case or the other share, we think it's reasonable, and we would be really pleased if we got about a third of that over the course of the next three years, right? Is that more or less the way we've described it? And so it's a little. Until the year 2 or start of the big. The big element of it, but, exactly right about a third over 36 months. Yeah. So we're encouraged about those partnerships a nd that's kind of a kind of a ramp expectation that we have of ourselves. I think your question generally from an economic standpoint is when we certainly when we strike those partnerships, there's some sort of combination of a referral fee or a rev share. But, then there's also kind of shared responsibilities as it relates to sales and marketing. So, when we think about sort of the economic outcome, we think about from a contribution margin standpoint being on par with a direct sale. Okay. I know you guys are excited about Payment Accelerator. Let's talk about that a little bit. Maybe Mike, start with who this is built for, what it is? who it's built for? and then the economics of it. Yeah, perfect. So, for those who have been following AvidXchange, the last couple of years, we've been talking about an offering called Invoice Accelerator, which was kind of our kind of initial product for supplier financing. We then rebuilt the product based on all the learnings of Invoice Accelerator and now making it generally available in the market as a rebranded Payment Accelerator. So, Payment Accelerator 2.0 is the former Invoice Accelerator offering improved based on all the learnings over the last, call it a couple of years. R elated to data science, remittance, recapture technology as it's going through the network, things of that nature. And, who it's designed for, of our 1.2 million suppliers on our network, we estimate about 60% are small businesses, maybe 30% are middle market, about 10% are enterprise suppliers. Well, the 60% that are small business is what this is designed for. So, 60% of 1.2 million, you end up with over 700,000 suppliers that are really the right profile for this type of offering. And, so we're really excited about what it means. Simply speaking, the average invoice has 30-day payment terms. And, the supplier, if an eligible invoice is able to accelerate it for next-day payment. And our experience has been the average accelerated payment is outstanding for about 25 days. And, we get an incremental about 200 basis points per transaction. So, it's really synergistic with our payment network. But also what people maybe don't realize, it's a phenomenal catalyst to drive electronic payment adoption because the majority of these small business suppliers are paper check suppliers today. For them to have access to the Invoice Accelerator program, they have to move to an electronic payment acceptance method, either one of our forms of virtual card transactions or one of our forms of AvidPay Direct, which is our closed loop. The other way of thinking about it, it really drives almost 400 basis point transactions when you combine the payment with the underlying acceleration fee. So, super excited. One of the metrics that we've made available, talked about, that gives us a lot of confidence around the success of this program is that today, for a supplier that chooses to do one advance, over 80% of them come back for ongoing advances within 90 days. We have high kind of stickiness factor related to this type of acceleration. We're also seeing more and more examples where rather than a supplier choosing to accelerate an invoice here and invoice there, they're choosing to accelerate just all their invoices wholesale and just make it a standard way in how they run their business. So, we like suppliers like that. Sure. Joel, in June of last year, you guys had an analyst day and rolled out some midterm, long-term targets. And, one of the metrics that you shared at the time was 20%+ organic growth as sort of a framework to think about the business. Now, I think there are some macro considerations today that might make that look a little bit different. But, let's just sort of remove the macro piece of it for a second w hy is 20% the right number for AvidXchange? Yeah, let me answer that after just clicking down a little bit into the landscape. So, when we June 2023, we did our investor day, we were about a quarter plus into the sort of at the front end of this macro correction a nd so, when we were clear to frame, we're early days in a really big market opportunity w e think this thing should grow 20% over time. We were clear to caveat that our assumption in those targets, we laid out midterm and long-term targets, was that that macro turned around at the end of 2023, entering 2024. Obviously, that hasn't taken place. So, that's an important caveat that 20% would require, as you say, stipulating that we return to sort of normal spend and volume activity across the base of buyers n ow, the way we think, generally speaking, about the growth algorithm is in 3 components. One being, overall net expansion on the platform, right? And so before this macro kind of adjustment that we experienced, we saw between 104% and 105% overall net organic expansion of the transactions on the platform, right, in sort of a same-store sales way. That's closer to 100%, even sub-100% right now. The 2nd of the 3 is just selling new logos and bringing their volume onto the platform. And then the 3rd is overall transaction yield expansion over time. And those were the 3 without really necessarily quantifying the components of those apart from the 4 or 5 points of growth that you get through number one. Yeah. And some of the kind of the strategies around some of those growth elements are certainly the innovations related to Payment Accelerator. It's clearly going to be our next $100 million business and kind of the third leg of our overall revenue model. And then, combined right on its heels is our spend management platform that will be released and adopted probably like think of it as about a year lagged after Invoice Accelerator or Payment Accelerator, I should say. And then, on our go-to-market strategies, just taking advantage of our partners, the AppFolio partnership, M3, Buildium, and there's a long list of other ones that continue to perform really well. And then again, without adding any new customers to the platform, we have this built-in macro big opportunity with still today about 50% of all our transactions being paper check. On a paper check transaction, although we get software revenue for it, on the payment network, we get zero revenue. It has relatively high expense of, call it $0.85 a check. When we flip it to be electronic through any of our kind of 24 different electronic payment modalities, that flips from zero revenue to maybe $7-$10 average revenue, and the $0.85 goes to $0.02. So, really powerful dynamic, even without adding any new customers. I'll pause for a second to see if there are any questions before we keep going here w e've got about a minute left. Sure. [crosstalk] A detailed question for you guys. What transactions do you divide by? It is all total transactions on the platform. [inaudible] Available transactions? No. So it includes, those checks, for example, that we're not monetizing. So, it's all the invoices and all the payments. Purchase orders, invoices, payments divided by all revenue. Maybe just to sort of round out the model conversation, you mentioned sort of managing what you can in the tougher macro environment t alk about what you have at your disposal on the margin side of things to continue that trend and continue to expand margins in light of a more challenging top line? Yeah. No, I'd go back to sort of the tenets that we laid out a year plus ago at Investor Day. And so we believe that we still have meaningful headroom to expand underlying gross margin f loat certainly has helped, but even removing the impact of float. We see continued reduction in unit cost and opportunity to continue to do so, w e've talked about kind of increasing the efficiency through standardizing processes, outsourcing those processes, automating those processes, both on the buyer journey, so, from an invoice ingestion all the way through to its process that ends with a payment, and then where we pick it up, where we take the payment file and execute that payment, whether check or all these other electronic payment methods. So, we talked about 75%+ gross margin. We'll continue to see that a nd I think we can. Maybe the quarter-over-quarter expansion year-over-year won't be the 400-500 basis points that we've seen, but, we still see consistent opportunity to expand gross margin w e've seen already the operating expense leverage, both from a G&A standpoint, R&D standpoint, and back to sales and marketing. We're making sure that we're continuing to invest in growth a gain, we're on the early end of this opportunity and trying to induce adoption, but we're seeing opportunities to do that more and more efficiently as well. Okay. It's a great place to start. In the early days of our AI journey as well. We've highlighted a few examples on our last couple of calls, but still in the scheme of things, really excited and not only about what we're incorporating in terms of customer-facing. AI components, but also how we're using it internally. Yeah. Okay. Great. It's a great place to end. Thank you both for joining. Thanks a lot. Thanks, Alex. Appreciate it. Thanks.