Welcome back, everybody. We are very pleased today to have Mike Milotich, CFO of Marqeta, joining us today. Mike, so glad you could be here. Thank you so much. Thank you so much for having me. Given you are somewhat new to the company, I'm sure pretty much everybody in the audience is familiar with you in another context. Tell us about the process that you went through to decide to move over to Marqeta. What did you see that sort of, you know, attracted you to the seat and to the opportunity? Yeah. I would say, I mean, the first thing is even, I guess, before I had even been engaged with the company, you know, just being in and around payments for about the last 15 years, the number of times in the last, say, five years that I've heard, you know, former colleagues of mine who really know a lot about payments speak very positively about the company. It's like that's happened many times. I think the people who really know payments, you know, really appreciate what, you know, the value and some of the capabilities that Marqeta is providing customers. I think that was my first, you know, kind of impression going in. I also think that although the company has accomplished a lot, there's still just so much huge opportunity ahead of it, because I think commerce is evolving much more rapidly post-pandemic in terms of the shift to digital and new kinds of commerce experiences, and we're really in the early innings of that, in my view. Marqeta is at the forefront of a lot of that, really behind a lot of those new commerce use cases. I also think the other trend that's very early in its, I guess, tenure is this, consumers being more and more comfortable getting financial services from non-financial institutions. Sort of this entire neobanking phenomenon and just, I guess, fintech in general. Again, this is an area where Marqeta has big advantages and serves a lot of those players. The two areas where I think Marqeta is most strong, I think are in the very early stages, in terms of their development and their maturation in terms of the way the business could evolve. I also believe that the FIs are not gonna just stand still either, right? As the innovation continues to happen, they're gonna start to react and wanna do, you know, innovative new things, which also should benefit Marqeta. Those are really the things that I saw, going in. I obviously met a lot of people in the process that I was very impressed with. Now that I've been in the seat about three months, you know, I would say what I'm most impressed by is the people in the organization. A lot of very experienced, skilled people, very motivated and energized by the opportunities that are ahead of the company. You know, that's been great and obviously just starting to work from the inside on all the, you know, solutions for customers that we're coming up with to help grow the business. That's terrific. It feels like Marqeta is sort of in the right place at the right time with the right people, the right solutions, to empower a lot of the broader kind of fintech, you know, ecosystem. You guys have developed some important new verticals. You know, if you have some historical verticals that, obviously, you do quite well in as well. But I wanted to talk about some of the new ones. Expense management is the new one. Mm-hmm. Can you talk about, you know, what's going on in that vertical for you guys? Maybe comment on the pipeline. What are you helping your customers with expense management too? Yeah. I mean, it's a very rapidly growing vertical for us. It's now over 10% of our TPV. The volume tripled year-over-year in the most recent quarter, and we have seven customers who are growing at least 100%, in this space on a year-over-year basis. It's incredibly high growth area for us. If you kind of step back and again, think about it from our customer's perspective, what are they trying to solve, right? They want real-time spending where they have a lot of control. So they can allow the flexibility for spending, that's dynamic, but they have a lot of control. They want the data to be easily tracked and reconciled, they wanna manage fraud, and they want it to be easy for their employees, who are either, you know, making purchases or traveling, whatever the use case may be. What we're providing is our platform is sort of so flexible and configurable, it allows for a lot of different use cases, so that we're delivering for each of these expense management customers. If you think about we have multiple card types, so we are provisioning physical cards for that employees can carry when they travel, for example, like a very typical corporate card that you would have received in the past from an employer. We'll also do a virtual card that we can give you, Ramsey, just for your next trip. That card will only be valid for the next three days for your specific trip. That way, again, it's managed much more tightly. We can also do a one-time card, a one-time virtual card that's for a very specific purchase. We're delivering all those types of, I guess, card solutions depending on the various use case that they wanna provide their customers. On top of that, we provide a lot of controls for them to manage. We use our JIT technology, right, to allow the easy funding of that credential to make it useful, and then be able to be very specific in terms of what MCCs you want it to be leveraged in, geolocation, so where in the world you want it to be available, right? You can have caps in terms of the amount that can be spent, so you can put a lot of parameters in place. For each card, and it's something that a non-technical person can do. There's a very easy interface that again gives these customers a lot of control and configurability, if you will, without having to, you know, engage their tech team. Of course, you know, all of this allows you to just manage fraud a lot better. Those are all the different ways we're helping our customers. What's fun about it for us is that we don't have to come up with all the good ideas. Like a great example that I think is really interesting is we have a customer who's using creating pre-issuing a lot of virtual cards to try to, I guess, be successful when a company who has, like, scarcity of their product does a drop. Like, think of this as a company who's releasing a new exclusive shoe or a concert from a very big band that's gonna be very hard to get those tickets. There are businesses that are using our virtual card technology to try to be very effective at getting a lot of those when there's a very small window to get them and then provide it to their customers. It's just like an example where people can use our platform in ways that we sort of never intended, but it meets their needs. Interesting. Mike, a similar question on crypto. That's another one of these verticals that, you know, we had a crypto and blockchain conference two, three months ago, and pretty much every company, organization at the conference was talking about issuing a card. Of course, I thought of you guys. Yes. Talk about crypto as a vertical for you. I mean, how is that again? Pipeline, longer term opportunity, what are you providing there? Yeah. It's still very early days for us. I mean, we do have revenue sort of in the millions of dollars each quarter now versus last year, it would've been, you know, essentially nothing. We have made good progress, but it's still relatively small. The value that we bring is another use case for our Just-in-Time Funding or our JIT funding. What we do, you combine JIT with our open APIs, and essentially it allows these card providers to essentially allow that card to be transacting in fiat, you know, at the point of sale or online from their crypto wallet, but it's really drawing down on a crypto balance, and all that can be done in real time with our JIT platform. That's really the core feature that we enable. We're also enabling, you know, interesting like reward programs that are tied to cryptocurrency as well with our platform. We're doing this for people like, you know, Coinbase and Bakkt and Fold and Shakepay. We have a number of customers, and they're using this use case. I think the longer opportunity that we see is kind of twofold. One is that a lot of these crypto providers may try to engage with consumers more broadly on their stored balances. Now don't necessarily just spend your, you know, your cryptocurrency, but you. From in your trading account, you have. You just maybe sold some stock or something else and you have a balance, you know. We can provide sort of neobanking like services to you. That allow you to use that balance in other ways through a card product. We think they're gonna try to expand more broadly and engage with their consumers. You don't have to be just spending crypto. You could also just be, have fiat balance, and you wanna spend in fiat and earn a crypto reward, as an example. The second sort of piece of this also is that the customer set might also become a lot more broader. As crypto becomes more and more mainstream, assuming you believe it's gonna continue to have more and more utility and be used in new ways, then it won't just be crypto companies who are gonna be wanting to do this, but it might be, you know, more traditional issuers. Again, we have that experience and the flexibility to support those use cases as it becomes more mainstream and more and more customers want sort of crypto, some crypto component to a card offering. I see. Also on the product side, give us an update on the credit product. That's something that's come up recently. Talk about the credit product. What's going on there? Yeah. We're making, you know, really good progress. We're launching several new programs this year. We've been, you know, developing this, and now we have programs going live, which is really exciting. Actually, even just, I think earlier today, the Greenlight announced a new credit card offering as part of this. This is a credit card designed to help parents save for their kids' college and for the family's future. Essentially, the rewards are geared toward saving for the benefit of your kids' future. It's a brand-new credit card that's launched, and they're using Marqeta in partnership with FNBO to provide that. You know, this is just a great example of they're using our kind of API-based credit stack and our partnership with FNBO, which brings a lot of credit program management capabilities, and we've put that together so that Greenlight can come up with this very innovative value proposition. This is just an example of the kinds of things that are gonna be coming to market this year. I think we've been talking a lot about credit in the past in terms of something we're working on. I think what we're excited about in 2022 is some of those value propositions and customers are actually gonna be going to market, and you're gonna be seeing, you know, cards out there that we're powering as we continue to also just enhance our platform in new way. Another thing I wanted to ask you to help us understand and maybe clarify a little bit is something that came up on the earnings call, I believe. Can you talk about the Managed By and Powered By business? Explain the difference between those two things. Yeah. Sure. This is something I think we, you know, we've been wanting to, you know, help investors understand a lot more of the different parts of our business. I think Managed by Marqeta, as we call, this represents the vast majority of our business, and I think this is what most people associate with Marqeta. This is where our customer relies on us to manage all the complexity associated with a card program. We manage the relationship with the network and making sure we're compliant with the rules. We have the bank partnership. You know, we help them with, you know, navigating the sort of legal requirements, regulatory requirements. We will help provision the cards for them. Think of it as we really bring all the capabilities you would need to have a card program, and they rely on our expertise to do that. They just focus on, "What's my value proposition? What's my user experience?" Right? Sort of leave all the aspects of actually running a card program to us. It really allows our customers to leverage our deep payments experience, 'cause as you know, you know, it's not the simplest space, right? It's quite complex in terms of all the rules and regulations that you have to manage. It really takes that burden off of them, and we pick that up. It allows for lots of, you know, new things. Like one of the things that was mentioned on the earnings call is, you know, a Buy Now, Pay Later customer of ours wanted to launch a new virtual card, essentially, that could be used for multiple purchases at multiple merchants, but in a specific window of time. That's something that would actually be quite complex to launch that in a bespoke way. Because we already manage their program and do another card offering for them, we're able to turn that around very quickly and help them get that into market. That's really the, you know, the big benefit for our customers when we do that. Our Powered By business is then where we only have a processing relationship. I would say this is our Powered By business is more what you would associate with most other issuer processors. The customer is managing the network, they're managing the bank relationship, you know, they are doing all the chargeback processing. Like, they're really owning the program. We're purely providing issuer processing. Some customers want this, you know, this approach, as particularly as if we make progress and make more progress expanding with large FIs, for example, this would be sort of the natural way they would leverage our platform. You know, this business has been growing really fast for us. You know, I mentioned on the call, our revenue's been growing well over 100% year-over-year for many quarters. This is becoming a bigger part of our business, a little over 10% of our volume. What's important about it too, in terms of how it manifests itself in our P&L, is it's gonna have a lower take rate 'cause we're providing less, right? Our price, if you will, in terms of revenue, will be lower because the number of services we're delivering is much more narrow, and we're not bringing a lot of those other capabilities we do in a Managed By solution. At the same time, because we're not managing the bank or the networks, we don't have a lot of those costs either. Our gross profit is very similar to other aspects of our business on a bps, you know, sort of basis as a percentage of volume. The gross profit is very similar because almost all of that revenue essentially drops to gross profit. You know, we think it's great that we have, you know, both of these solutions depending on, you know, where the customer is in terms of their maturity, their adoption, how much they wanna take on, you know, we can offer either solution to best meet their needs. It, you know, works for us investment-wise and P&L-wise because our marginal costs, you know, tend to be pretty low as a platform business. You know, we can service both use cases quite well. I see. That's super clear. You mentioned banks, and that's, you know, in the Marqeta, you know, bull case, eventually, as time passes, you guys will be able to bring your value proposition to larger FIs. You obviously have your toe in the door at least with a couple of them already. How do you think of that, especially someone who comes from, you know, the, you know, not the banking industry obviously, but I might have a viewpoint there. Like, how easy will that be to accomplish? How should we think about it in terms of, you know, timing? Yeah. I mean, I think, you know, calling it our foot in the door is absolutely the way we think about it. I think the big win we've had, you know, with some of our, I guess, large FI partners at this point is that they've done the work to connect to the platform. For a very specific, you know, sort of small use case, which, you know, may not generate a lot of revenue in and of itself, but just getting the platform connectivity is a huge step to get that foot in the door, as you said. Because once the platform work has been done, now they can consider our platform when they wanna do something innovative. We don't think how our business is gonna evolve with the FIs is that they're not just gonna one day just cut over a bunch of business like a traditional migration might happen. We think it's gonna be more happen in the area of they wanna do an innovative product, right? They've seen how maybe we've done it for other more disruptors, and that's how they know there's demand from consumers for that capability, and they are looking for someone to provide that. Their, you know, legacy provider who does most of their core business today, you know, doesn't have that capability, or it's very difficult for them to configure the platform to make it happen. That's kind of how we believe we'll be successful with large FIs. We'll start with something innovative, and we'll support that. The next new product they wanna do will also be, you know, innovative and will be more modern, and we'll help them with that. You know, eventually we start growing our business from within. A lot of it is the value of time to market and the configurability of our platform also really lowers the total cost of ownership. 'Cause for the large FIs, they'll tell you if they wanna launch a new product, given the way the technology works today, it's incredibly expensive for them to stand it up. It takes a lot of investment. What we bring is this very high API-based, cloud-based, highly configurable platform that allows them to be much more nimble and at a lower sort of upfront cost to get the program launched. You know, that's really our strategy, is to, you know, gain their trust, prove that we can help, and we'll sort of chip away slowly, and then eventually, hopefully, thinking out many years, it tips a little bit, and then we get, you know, start having the, you know, the majority of their business, would obviously be the outcome we're looking for. Interesting. As their product needs evolve, you're better positioned to basically help them with innovation and help them with more sophisticated value propositions. That's where the foot in the door becomes a leg and then maybe more. That's right. That's right. I wanna ask you about competition. It's a question I get sometimes from investors. You know, how should we think about the moat? How should we think about what? Let me reposition the question. What differentiates you from others in the marketplace that are potentially trying to offer similar solutions? Yeah, I mean, I would say, I think there are kinda two types of competitors, right? There's sort of the established legacy players, and then there's the more, you know, modern companies, who are maybe, you know, we, I guess, invented modern card issuing. We were the first player, and now there's others who see the opportunity that we see. I would say the legacy providers, for the most part, we don't really see us competing head to head, right? Their customer base and what they do is quite different. As we just talked about with large FIs, we hope to kind of pick up pieces of business as we go, but we typically are not competing with them directly. You know, the modern players like, you know, Stripe or Adyen, Highnote, Lithic, you know, these companies are, you know, more modern in architecture. I think the ways that we are successful or differentiate ourselves is on, you know, a couple of fronts. I think, you know, our solution from a developer perspective is quite simple, right? We have very well-defined APIs that break down all the ISO messages. We have translated the complex aspect of payments into very intuitive kind of developer-friendly user experiences with, you know, really good documentation and toolboxes and things that makes it easy for them to launch new programs. That's one. You know, we bring this very valuable bundle, as we talked about early in our Managed By, where we'll bring the, you know, as a program manager, we'll bring the bank and the network and all the tools that you need to manage the card program. We make it sort of easy to bring that full solution, both for if you wanna have a commercial program, you wanna have a consumer program. You know, we can support all those different use cases. Our platform is highly configurable. As I've mentioned a few times, so just that ability to serve multiple use cases and make it very easy for our clients to be adjusting on the fly. This just really improves time to market. So we. Like another example in the BNPL space is we had a BNPL customer, not this past holiday season, but the year before, so almost 18 months ago now. We wanted to stand up a very large retailer, and it was getting close to the holidays, and as you know, no one really wants to touch their tech in retail close to the holidays. We got that enabled for them to accept this BNPL player within a week's time. Like, so just that ability to make alterations and get things up and running quite quickly is a huge area of, I guess, differentiation for us. The last two I would say are particularly important. We are already operating at scale. The fact that, you know, last year we did well over $100 billion of volume, and, you know, we said on the call, for example, the number of customers we have that now do more than 500 million of TPV, you know, in a quarter just doubled this year versus, you know, the first quarter last year. Customers are looking at, if I'm gonna be very successful, and of course, they all think they will be, then this is a platform that can handle my ramp and has already proven that they can operate at scale because, you know, our volumes grew more than 4x in the two years of the pandemic. Right? We were able to manage that well. That scale we bring is unique and differentiated in the space because we were first. We have that. Then the second thing that comes with being first is all the experience that we bring. We've been at this for 12 years. That really can't be underestimated. We've learned what works, what doesn't work, right? We've learned from mistakes that we've made in the past. We've built a variety of things for customers that other people can then leverage. All that experience that we bring is quite valuable to our customers. Those are the ways we tend to win against the more modern platforms. How sticky, how difficult is a migration? You know, at the end of the day, when I look at the legacy kind of card issuing processing business around banks, there's not a lot of customers changing hands very frequently because it's a heavy lift. It's card reissuance, potentially, you know, there's a lot of integration. Like, is that? Is it fair to say that once you have a customer, you know, it's a pretty. You know, there's somewhat of a moat from just the complexity of the integration, the depth of the integrations. That's right. I mean, it's switching is very disruptive. You're right, it's very sticky, and I mean, we have fast-growing customers, but one of the reasons why, like, last year, our Net Revenue Retention in 2021 was 175% is because not only are they fast-growing, but they really keep their business with us. That's one of the ways we accomplish that. The disruption comes from if you have to change, you have to reissue physical cards. If you have any kind of physical cards in circulation, that's pretty disruptive. You might have to get a different bank, and then you might have to do a new deal with the card networks and everything else that comes along with it. It's quite disruptive. The more services we provide, obviously the stickier it is. You know, if we've provided a lot of other, you know, risk services and maybe we help them get, you know, all their cards and card fulfillment and everything, then that also makes it, you know, pretty sticky. It's not that it can't be overcome, right? Like, we have flipped business. For example, Divvy is a very large, fast-growing customer for us, obviously now is part of a larger entity, but, you know, we didn't have that business initially, but they came to us because their previous provider wasn't able to support, you know, all the things they had on their product roadmap and the things they wanted. They did make the change, and we were able to, you know, win that business. I'd say just like a lot of the payment space, the changes are, you know, relatively uncommon because of the stickiness, but it does happen if you don't, you know, meet the needs of your customer. Fair enough. I wanna ask you a couple questions about your largest customer, Block. One question that I get from investors sometimes is the degree to which you may or may not benefit from Square/ Afterpay deal synergies. It seems like you've got, and I'm not asking you, God knows, to comment on their business, but just logic would tell you there's a lot of Cash App customers that could be cross-sold in one direction. [audio distortion], you know, customers, you know, cross-sold in the other direction. Is that something that we should think about as a potential? You know, if they're successful there, that would flow down to you. Absolutely. I mean, we're excited to help them. I mean, obviously, both Block and Afterpay are big customers of ours, so we already work with both of them, and we're excited to help them in any way they need to maximize the value that they wanna generate by bringing the companies together. As Jason even said, you know, on our earnings call last week, right, our customer success is what is our success. You know, we are excited about how those things can be merged in all the different ways that we obviously support Block in many more ways than we do together with Afterpay. So there's lots of new ways that we can support the Afterpay part of the business. We also work with, you know, Afterpay in many other geographies also that we are not supporting Block in. There's a lot of ways that we can help kind of bring synergies for them and make it easier for them to get the most out of that combination. Another one on Block. You guys have a renewal. They're big customers, obviously the biggest, and you have a renewal coming up in a couple of years, I think. Is there any way to help us sort of frame up timeline or process or scenarios that we might think through or any color you could provide? I know it's a tough one. Yeah. I mean, there's not much I can share. I mean, prior to the IPO, we did renegotiate long-term agreements with, I guess, Square at that time. So the Cash App and seller card, the contracts are up in 2024. Just as, I guess, coincidence, our Afterpay agreement is also up in 2024 separately. You know, we have two years or so. I mean, I think that, you know, we'll engage when it makes sense for both sides, and we'll obviously, you know, keep you apprised if and when that happens. Fair enough. Mike, unfortunately, we're out of time. What a great conversation. Appreciate you being here today. Thanks so much. Thanks so much, Ramsey.