All right. Hey, everyone. Where do you live? I live in Chatham, New Jersey. Oh, okay. Very nice. So you mentioned kids go to school there. All four. Very nice. Well, good morning. Good morning. No. Good afternoon. I'm Dan Dolev, and I'm the Payments Analyst here at Mizuho. I have the pleasure to be joined by Taylor Lauber, President and Chief Strategy Officer at Shift4. And, you know, everyone knows Taylor is Shift4, basically. So this is basically a one-man show, and he's responsible for all aspects of growth, including overseeing product development, strategic partnerships, corporate development, investments, prior to Shift4, with Blackstone, where we met briefly at a drink event a few years ago with a common friend in a variety of strategy roles, most recently COO, Lead Portfolio Manager at Blackstone Total Alternatives Solution Fund. So, Taylor, thank you so much for joining. Thank you. This afternoon here at Mizuho. Some questions that I prepared, and then at the end, we'll open it up for Q&A. So, you know, for those in the audience that are not as familiar with Shift4, maybe, Taylor, can you give us a little bit of, you know, background and some of the history of the company and, you know, pre-IPO, IPO, and where we are today? Yeah, sure. So maybe just a little bit on my background, because I think it gives a bit of a unique vantage point. So you mentioned I spent the bulk of my career in financial services, but long before that, my first job in between high school and college was in our founder's parents' basement when he started the business. So I was the idiot that went to college, even though he told me not to. And I, you know, declined job offers at Shift4 for, you know, 15+ years, and yet got to watch it grow throughout that evolution. And I'd say there were a handful of characteristics that, as we look at them now, really defined how the business would behave very differently from the competition over the course of the 25 years that we've been operating. Number one was, back in the late 1990s, it was very easy to get disillusioned about the product offering of the day. It was effectively a countertop terminal helping merchants accept credit cards for the first time. And anyone who did it was pretty successful because it was all about just enabling merchants. And as, you know, 16- and 17-year-olds, they're sending us credit cards in the mail. So, like, just being able to catch these credit card payments was something that, you know, a lot of companies were very successful at doing. But, you know, Jared recognized very early on that if we don't introduce technology, we are going to command no right to this revenue stream. Approval or a decline or a refund, you know, while novel for a merchant that's never done it before, isn't differentiated in any way, shape, or form. It's begun this 25-year journey of constantly seeking out the technology solutions that really attract a merchant and bundling that with the payment processing that they kind of need to pay for anyway. We have focused predominantly on what we would define as card-present verticals, you know, physical places where you're going to be. You know, we've steered clear of e-commerce in our early days with the idea that we can differentiate, you know, in service verticals that are going to be around for a very long time, regardless of, you know, the direction the internet takes. Today, what that means is we're in roughly a third of the table service restaurants in the United States. We are in 40% of the hotels in the United States, and we're in 75% of the stadiums in every sports league in the United States. And I'm particularly proud of that because we weren't in a single stadium four years ago. We weren't in a single hotel 8 years ago. What's attracted us to these environments is complexity. It is a merchant that, you know, isn't just, you know, the bar and grill in Boise, Idaho, but what if that restaurant needs to live inside of a hotel alongside of lots and lots of other software suites? Who's going to stitch all those together and deliver that hotel operator, you know, a common commerce experience for all their consumers that's secure and great analytics, but also a single deposit at the end of the night? And increasingly on this journey, we've found that the competitive air gets really thin in the more and more complex environments. It's, quite frankly, what attracted us to stadiums is they look a heck of a lot like a hotel. There are just dozens of different places to pay. That's lots of software that needs to be integrated together. And no one of those software suites gets to say, "Hey, all your payments are going to come this way, and I'm going to give you a different deposit from everyone else." So quite a strong ability to differentiate and just taking a playbook that's been run quite successfully for 20 years across, you know, larger merchant categories, new verticals, and increasingly new geographies. I just want to emphasize that this idea of software and payments being tightly bundled together that we all know full well in the U.S. really hasn't evolved that way in the rest of the world. So we're immensely excited to go to markets that are otherwise very highly developed, whether that's London, whether it's, you know, Munich, and there's always a bank terminal next to a piece of software. We think we can help that convergence just like we did in the United States. Yeah. No, I agree. I mean, the opportunity is huge, especially outside the U.S. And you're addressing it with some of those recent acquisitions. And so given going back to the growth, I mean, the growth has been really impressive. I think you're 50% CAGR since 2019 versus, you know, about, you know, almost, you know, five times more than the networks, which is very, very strong. Can you maybe lay out some of the competitive advantages that allow you to get this, you know, very, very fast growth trajectory? Yeah, sure. And I always want to sort of demystify the growth because you've got awesome players across our industry, the likes of an Adyen or a Stripe that are growing exceptionally well, but they're also benefiting from industry cross-currents that are helping them tremendously. Said differently, many of their customers are growing for them, like a Netflix, like a Facebook. In our case, we're serving merchant categories that, you know, for better or worse, don't grow a lot. There's not, like, a large growth in the restaurant spending. You know, hotels are pretty static. If one shows up, it's generally replacing one that disappeared. And similarly with stadiums. So I want you to sort of think about our 50% volume growth in the context of the only way we're going to get it is by adding lots and lots and lots of customers. We are under no illusions that if we want to grow next year, it means a heck of a lot more customers. But there are two ways it's being manifested. Number one, it is adding a lot of customers. It's obsessing over the technologies that will attract them. It's also recognizing that there are lots of merchants who have been served in a piecemeal way that don't have to. We've found lots of software assets that play a critical role in the payments infrastructure and have yet never bundled it and monetized it. And why should that work that way? If the merchant's loyal to the software and they use it every single day, it should bundle the payment processing in a simple and seamless way. So we've been able to add a lot of customers that way. Then separately, the average customer we serve has grown tremendously on a volume basis. And what I mean by that is, you know, we were the bar and grill in Boise, Idaho, back in 2017, and then suddenly we were, you know, a hotel, and then suddenly we're a stadium. All of these are just much larger volume merchants. So that's helped compel our growth as well. And it's meant we don't have to add quite as many customers to achieve, you know, levels like that, which is nice. And I think your M&A approach from what, you know, Nick and I have been seeing is a little bit different than your competitors. You know, you're taking over, you know, you find really good deals. You're taking over, you know, volumes, and you basically use your software on top of those volumes. And maybe can you tell us a little bit about that specific strategy and how that's different from, say, some of your competitors? Yeah, of course. In the space. Number one, I would say it was 20 years ago when we started to learn how to make what had been at the time three different industries work well as a single product offer. So again, 20 years ago, merchants bought software, they bought hardware, and they bought payment processing all independent of one another. That knowledge of what it takes to be a provider of all of these services in a cohesive way, what are the phone calls you get from a merchant? What does the factory need to look like that's deploying these products? You know, what are the demands of those customers going to be? We started learning that 20 years ago. And so it's given us a distinct advantage to look at businesses that haven't quite made that evolution and say, "We can help you with this trajectory." You know, in the case of a recently announced transaction, we bought a restaurant point-of-sale company called Revel. They have 18,000 customers. It's great software, but they overlooked this payments opportunity reasonably significantly throughout their history. We can acquire that business and instantly integrate a new revenue stream that they've overlooked. And by the way, their customers are paying for it anyway, and it doesn't work terribly well when it's two different vendors. So we can acquire that business. We can introduce a new revenue stream immediately that they've overlooked, and the customers get a better experience, and generally, they can save money by bundling all these things together as well. So that allows us a vantage point to look at an asset in a fundamentally different way than what are the revenue streams going to look like if we buy it. What is the expense base going to look like? We know we can embolden it in a way that others can't. And we've done this, you know, incredibly successfully. At the end of the day, all it leads itself to is dramatically lower customer acquisition costs than our competitors. If you look at our great competitors in maybe just the restaurant vertical, they spend five times what we do to acquire a customer, and they largely haven't been profitable at any point in their history. You know, one thing I neglected to mention is that Jared didn't take outside capital for the first 15 years he ran the business. That's a very different mindset, looking at the checking account every day and saying, "How am I going to spend my money and what is going to generate the best return on capital?" So I think, you know, it's categorized as M&A, but what you'll find is a highly, highly efficient customer acquisition mechanism. And the thing we have to be mindful of is this idea that you have to remove the parts when you have an M&A strategy. You can't let any one of these things sit individually. You have to constantly repurpose the business. You don't end up with a ton of appendages. And I think that's what some competitors have done that have led to bad outcomes is they've kind of bought the asset, left it alone, maybe given it, you know, one slight differentiator, but really never managed that population in an efficient way. I'll give you just one example. We bought a restaurant point-of-sale brand a year ago. The general manager of that business oversaw the migration of payments into his customer base, educating his resellers on how it should all work. He is right now in Germany on the next asset we're looking at there, sitting with the local team doing it. That's just one example of repurposing, you know, constantly in pursuit of kind of what the objective is of the day and not letting early success and complacency, you know, create a margin problem or just like an inefficiency problem over time. And then speaking of M&A, I think most recent quarter, you discussed some of your capital allocation opportunities, whether it's product, customer acquisition, share repurchases, M&A. Can you maybe explain again what is the best, where do you see the best use of capital? Yeah. Over the next few. We're conflicted in this because we're seven times more profitable than we were at our IPO four years ago. And yet our share price is nowhere near, you know, seven times higher. And in fact, the multiple on our equity is compressed over that time frame. And so we view our equity as like one of the surest things we can invest in, and we believe that, you know, we should be buying back, you know, healthy portions of that. And that is competing with, you know, really, really interesting customer acquisition cost M&A with lots of efficiencies we can drive from it. So what do you do when you have this, quite frankly, awesome problem to have? You do both. We are buying back our stock, and we are not letting that dissuade us from M&A transactions that we think will make us a fundamentally, you know, better business and, quite frankly, grow at incredibly, you know, efficient cost of capital. And then we have a few more questions, and then we'll open it up for a question or two from the audience. I mean, maybe we can get a little bit more deeper into your end markets. Obviously, big success in sports entertainment. You own the hotels, resorts vertical. Like everywhere I go, I check, and Shift4 is always there, which is great. What we tell investors is one of the reasons we like Shift4 is like, you know, you still, even in like AI, e-commerce, cyber world, you still want to go on vacation. So it's like, you know, it's always going to be there. It's like a restaurant. Like you're not going to vacation on the, you know, in the metaverse. But can you, I think you acquired Appetize. We did. Last year. And can you maybe give us some background on how you got into this end market and like what's so exciting about Appetize and that acquisition specifically? Yeah, it's a fun story. It's accidental, but it also gives you some insight into how we think about opportunity. We were actually asked to buy a box at a new football stadium being built in Las Vegas several years ago. And in touring the facility, it was just immediately apparent how closely that mimicked the hotel environments we serve. And you know, this is the Raiders Stadium in Las Vegas. It's got nightclubs. It's got table service restaurants. It's got software for parking. It's got suites. It's got point-of-sale. You get the picture. And we said, "Wow, we can serve this market exceptionally well." And we started to study the software providers who were winning and who were losing. And there were effectively two companies back then, this is 2019, that were winning in the market. One was called Appetize. It was by far the dominant player. You know, I don't want to cite the revenue statistics specifically, but it owned a really healthy share of the market. Our issue with it at the time was that it was losing meaningful dollars, $10s of millions a year running their business. We said, "If you already own the bulk of the market and you're still losing this money, what's the end game?" We just couldn't get our heads around, you know, that as an acquisition. Contrast that to this awesome scrappy business seeded by the San Francisco 49ers that, you know, was doing $12 million a year in revenue and break even. They had actually won one of the largest stadiums in the country by bundling our payment processing services. They actually took our value prop without telling us and introduced it to the customer and used payments to subsidize making their product cheaper. And we said, "This is just a match made in heaven. They know exactly how we go to market, and they're doing it." So we bought that business for, I want to say, $75 million. And it became very quick that we were winning basically every stadium that came up. And we educated them, "Don't just focus on your technology. Don't just focus on mobile ordering. Don't just focus on concession sales. Focus on all commerce that's going on." And they took it like way further than we expected. So yes, they integrated to, you know, the Fanatics retail store. They integrated to the parking software. They went so far as to integrate to Ticketmaster, who's actually selling the tickets to the games. And suddenly that payment volume is flowing through Shift4. So basically, the majority of all the revenue that the team is collecting is flowing through Shift4, and we're giving them a common analytics platform to understand all this, really, really differentiating in the space. Fast forward to last summer, and the owner of the Appetize business called us and asked us if we'd take it off their hands. So, you know, again, a vertical we weren't in. We weren't in it four years ago, and suddenly our number one competitor is calling us and saying, "Will you buy the business?" And so we looked at that as a perfect embodiment of our M&A strategy. Can we accelerate what we've been doing anyway? We've been winning a ton of the market. Can we accelerate that if we own our number one competitor as opposed to just wait for the customers to come to us? And so we closed on that transaction in September, and we are now installing more stadiums with our VenueNext technology in a month than we have ever in our busiest quarter. It's pretty damn cool to have, you know, the likes of a Yankee Stadium, you know, on a dime installing our VenueNext technology and giving us, you know, ticketing business by way of example across, we're seeing this across many teams. So it's a vertical we've got a lot of opportunity to gain while it's here. We've already got a foot in the door with the majority of the customers. We've also got a TAM opportunity that we never saw at the beginning, which is suddenly, you know, we always underwrote the payment volume associated with the venues themselves, but now the ticketing is, you know, three to four to five times that. Interesting. Yeah. And then maybe sticking with two more acquisitions, Finaro. Yep. I think Israeli founded and operates in Europe. Like maybe can you give us a little bit of the strategic rationale about getting into, you know, this is mostly online, right? Yep. So e-commerce, maybe that has probably ties into your European strategy as well, but maybe shed some light about that. Yeah. Well, so international for us has always been a challenge. We have kind of two of the three ingredients for success. We had customers, global hotel chains, for example, working with us in the United States and saying, "I want this solution in the rest of the world. I want a single vendor solution that you deliver me so well in the United States, and I want it in Europe, and I want it in Latin America and everywhere else." Interestingly, the software that's integrated to Shift4, the front desk software, the lobby bar, the gift shop, it's all installed all over the world. You know, the Hilton in Madrid doesn't run on different software than the Hilton in Times Square. So we had this, we had the customers and we had the software integrations. What we didn't have were the local financial capabilities. So we didn't have the ability to accept cards locally, deposit local funds, et cetera. That's a prerequisite, right, to operate in a local environment. We went and searched across a bunch of different payment platforms, and the Finaro business was kind of the polar opposite of Shift4. It was cross-border e-commerce, you know, and we said, you know, this is a means to an end for us. We're going to structure the transaction in that a healthy portion of the consideration will be tied to technical milestones. If you can achieve a working restaurant, a working hotel, and a working stadium, we will pay you, you know, meaningfully more for the transaction. Now, annoyingly, it was a European bank, so the regulatory review took a heck of a lot of time, and they achieved all those technical milestones before we even owned the business, which gave us that much more confidence to close on it when it came through. So to contrast it, Finaro was like virtually zero card present transactions when we signed it back in March of 2022. Now, you know, it's over 15%. So we're basically taking that as a platform. They can still do what they always did. However, what makes us special? It's restaurants, hotels, stadiums, and a handful of other things. And so we've already won a decent, you know, chunk of restaurants. We announced our first multi-hundred location hotel win in Europe. All of this will be the Finaro pipes and our software integrations and our go-to-market. Very cool. Maybe I'll open it up for questions. Does anyone have a question for Taylor? If not, I do have another question. Sure. Which actually I wanted to ask you before, but we didn't mention SkyTab. And you know, SkyTab is very successful. A lot of people are very excited about it. You guys are very excited about it. It's a very competitive space. You've got, you know, Toast and, you know, some private guys. Like what makes SkyTab special in competing in such a hyper-competitive restaurant POS industry? So we don't view it as competitive as I think investors do. Maybe it's just because we segment it differently. We are in table service restaurants in the United States and hopefully the rest of the world pretty soon. In that environment, it's ourselves and Toast that are generally, if you're picking, if you're winning a new location for that new restaurant's coming online, it's using one of the two of us. When you get into things like coffee shops and bakeries, you're suddenly in Square and Clover territory. I would say there's not a lot of, you know, competition between us and them because the software that makes it really easy for an owner-operator to download on an iPad and run their business is not the same as the software required to run a table service restaurant. So it's really in that vertical. It's ourselves and Toast. And I think we differentiate in pretty specific ways. You'll find we don't generally do things like capital offerings or payroll or these kind of run-your-business suites of software because we want the kind of merchant that would never pick our payroll. We want the kind of merchant that would never take a 30% APR loan, you know, from us. And so we try to skew higher market. Again, we found the margins thinner in the competitive, in, sorry, in the enterprise space. And then lastly, what I'd say is, you know, we've been doing it for 20 years. And that is a competitive differentiator. We've seen lots of different economic cycles, and we've grown revenue, and we've grown free cash flow through all of them back to, you know, dot-com or, you know, the travel-associated anxiety of 9/11 to the financial crisis in 2008 to the great pandemic. We actually grew payment volume 20% year-over-year in the third quarter of 2020. I can't emphasize how hard that is when 99% of your business is restaurants and hotels. And so we think we've just got, you know, the right combination of expertise, flexibility, and how capital gets deployed to solve the problem. And one good competitor, and we love that. Maybe one last question from my end unless there's anything from the audience. Free cash flow has been great. Maybe can you give us a sense of what allows you to sustain strong free cash flow and sort of some sort of like a long-term margin vision for the business that you have? Yeah, sure. We don't explicitly have a margin target except to say, again, we believe wholeheartedly in this philosophy that, you know, live within the means of your own checking account whenever possible. And. You should tell it to my wife. Every dollar, you know, really needs to be paid back within 18 months, whether that's to hire an employee, whether it's to invest in R&D, whether that's to buy a company. You know, we can't play the game where that, you know, just drag the model far enough to the right of the screen and there'll be profitability at some point later. No, 18 months period, full stop, which creates a really good discipline. And it also forces actions that might otherwise be uncomfortable, meaning that you do need to repurpose personnel as your business evolves. It doesn't mean that you part ways with people aggressively, but it does mean you are maniacal about saying, "Hey, you used to install, you know, MICROS point-of-sale systems in high-end restaurants in New York City. Now you're installing stadiums." So that's been, again, I think just it shouldn't be as unique as it is. Any owner-operated business without a Series A, B, C, D, E thinks this way, but it is rare in the technology space. Most of our good competitors have never made a profit. We can't fathom how that works. We would love investors that don't demand profit, but, you know, our largest employees own 42% of the company, and we demand like a good return on capital. Good. I think we're out of time. Awesome. Thank you so much. Thank you all.