Guess we can go ahead and get started. Welcome. My name is Clarke Jeffries, Senior Research Analyst at Piper Sandler. Very pleased to be joined by the Olo team, Noah, Co-founder and CEO of Olo, and Peter Benevides, CFO of Olo. Gentlemen, thank you for coming to Nashville. Clark, thank you so much for having us. Appreciate it. All right. Well, maybe we can just kick things off with, you know, Noah, where did Olo come from, and you know, what's the mission of the business? Yeah, well, today we talk about our mission as hospitality at scale, and what we mean by that is using all of the guest data that we're able to generate through our business to help our restaurant customers really be able to personalize the guest experience, make every guest feel like a regular, and with that, drive profitable traffic to their business. Where Olo began nineteen years ago, in two thousand and five, was as a digital ordering service, and that meant enabling restaurant guests to order ahead, pay ahead, get coffee and food faster for takeout at their favorite restaurants. That evolved over time to include delivery as a service, to include marketplace aggregation, and that's really how we came public in two thousand and twenty-one. Since that time, we have expanded into two additional solution suites, Olo Pay and Olo Engage. So now we have three solution suites: Order, Pay, and Engage, helping restaurant brands with order processing, obviously, payment processing and guest engagement. And we think about those three things really as a flywheel. So if you think about, guest data at the center of the flywheel, more orders and more payments are all great elements of guest data. Those get fed into the guest data platform, which is really the foundation of Olo Engage, and we use segmentation and marketing automation to personalize the guest experience, drive more transactions, and the flywheel continues to spin. And really, that's what the idea is for the guest data flywheel and for helping brands to drive profitable traffic. I should say we're also an open and modular platform, and that means that we serve restaurant brands really that are enterprise in scale, anywhere from five locations and up. We have some brands that are even smaller than that, but have that ambition of scale, of becoming big enterprises of tomorrow. When you think about the scale of the business, we're now serving 82,000 restaurants across 700 brands, 85 million guests that use Olo on an annual basis. We process over 2 million transactions every day through the platform. One thing I'm really proud of is that we have a 400-strong partner network of 400 integrated technology partners, and that's key to our being an open and modular platform, and helping our restaurant brands really design the tech stack that they want to design. To my knowledge, that is the largest technology ecosystem in history within restaurant technology. Yeah. Certainly, the timeframe over the last few years during the height of the pandemic, it became mission critical to really own your digital ordering stack and have that agency. And even though that's a secular trend, it was a time period of immense importance. Peter, maybe we could also frame the scale of the business in terms of, you know, where's the top line today, how quickly are you growing, and where are you at from a profitability perspective? Yes, so Noah touched on some of the non-financial kind of scale data points there. In terms of financial, based on our latest guidance, we are at $280 million of full year revenue. It's a growth rate around 23% year on year, with non-GAAP operating income in the $26 million range, was about 9% operating margin. In terms of some other factors to think about in terms of scale, we last year processed over $26 billion of GMV on the platform, of which $2.5 billion of that was GPV. So meaning what portion of that was processed over our payments products. Yeah, perfect. Well, thank you for the overview. And I, you know, maybe wanna orient the conversation through the lens of these three product suites that have emerged, the company: Order, Pay, and Engage. Let's maybe start with Ordering, the oldest one, and sort of the backbone of creating that digital ordering experience. From a conceptual standpoint, why isn't digital ordering easy for these restaurants? You know, what are the frictions that cause a brand to come to Olo and say, "You know, I need, I need help to do this right? Oftentimes, restaurant brands don't have the capabilities in-house to build a tech stack like the one that we've built. Some restaurant brands have, and are oftentimes making a migration off of a homegrown tech stack and onto Olo. It is very difficult to build these things and to maintain them, and I think those are two different and important points. To build them, you have to really deal with a heterogeneous tech landscape within a brand, oftentimes. Different point-of-sale systems at use with different operator groups or different franchisee groups, different point-of-sale, different kitchen display systems. There are a whole lot of different integrations, and that's where our library of 400 integrated technology partners is such a durable advantage. An individual brand having to go and replicate that is very painful. Then there's a lot of complexity in just the core of the product itself, doing the menu synchronization and all of the customization work that can be done on a menu item, all the different permutations. It's very different than traditional e-commerce, where you have a list of SKUs. This is really about menu items and all different permutations, customizations, modifications, additions, removals from those menu items at every single store, pricing from every single store. So we see a lot of brands spending, if they have built in-house, you know, tens of millions of dollars building something like this, and then oftentimes, tens of millions of dollars on an annual basis supporting something like this, and it's really not their core competency. So we think that's a durable advantage of a scaled SaaS platform over something that's homegrown, that has to be built and then maintained with reliability at scale, with security at scale, and with high performance, and an ever-evolving tech landscape. Yeah. It's ironic that a lot of these brands can create a very similar location in different physical locations, but the technology can be very heterogeneous across, you know, sub-regions, sub-operators, franchisees. You know, Peter, can you help us think about how that opportunity is monetized, how it grows? You know, is it per location? Is it volume-based? Just thinking about how you're kind of aligned to the success of their digital ordering business. Yeah. So within the Order product suite, we have a host of product modules that help brands both provide digital ordering as well as delivery enablement and as well as channel management. There's a host of solutions. I'd say fundamentally, we charge on a per location, per month basis a SaaS fee, and then we have additional products like Dispatch and Rails, where we monetize on a per transaction fee. The subscription fees, the underlying subscription fees that we charge for the Order suite, they scale up as transaction volumes grow, but the per cost of each transaction goes down. So we're really trying to incentivize you know, brands to push as much volume through the platform as possible. If you look across all three product suites, we have 15 product modules now to sell across all three product suites. Today, we are, on average, providing about three and a half product modules per location, so a lot of opportunity to expand within that base. For the most part, that three and a half is really most often within the order suite, as pay is a, you know, relatively new product as is Engage. So we'll continue to expand into those opportunities as well. Mm-hmm. And certainly, I've talked to some of your customers where they may have had a digital solution, but it was a black box for them. And then when they ended up switching to Olo, they found that that could actually grow for them as a business. There was some issue with the experience. They really didn't have any visibility before. How often do you see that, where they have digital, but it's not necessarily a capability that's running as well as it should be, and the management and the choice of making an investment in digital, it's really aligned against a performance metric of an underperforming digital business, and when they get the right tools, it ends up growing? I think that's a very common story. I mean, often you hear of brands that say, "Yes, yes, we have digital," and it's kind of like they're checking a box. They have something, they have some ability for the guests to order from them and get takeout, but they don't have a good delivery experience. Oftentimes, brands racing to get digital during the COVID era would just sign on with third-party marketplaces, and they'd say, "We have digital." And yes, indeed, there were ways for guests who wanted that brand to order from them. However, in those cases, when a guest is ordering from a marketplace, a DoorDash, an Uber Eats, a Grubhub, the restaurant brand is getting none of that guest data at all, and they're paying a hefty commission. It's not really like having one's own first-party delivery program to enable direct digital, to have just third-party digital. A lot of brands had to make that move 'cause they didn't have anything in place during COVID. I think what we've seen in the years since is brands saying, "We checked the box. We got something going. We, we validated that our guests want this. Now, let's get our own program, and let's really focus on metrics that matter. Let's think about the conversion rate of when a guest starts an order, do they complete that order? Let's think about the number of guests that we have in our guest database and how we are growing that over time. Let's think about guest lifetime value. Mm-hmm. This is really a new paradigm in restaurant marketing that will tie into our Engage conversation. But these are the metrics that really matter when you're thinking about growing and scaling your digital business and using really the right metrics to measure that success. Mm-hmm. You know, one of the, you know, kind of marquee account announcements this year was Dutch Bros as an order and pay customer for eight hundred and fifty locations deploying later this year. I think that's particularly interesting because there's varying levels of maturity and sophistication, it seems like in this industry, where there may be a brand that doesn't even have a mobile app, doesn't even have any kind of technology strategy, and they're looking to really, you know, greenfield adopt digital. And then there are ones that have the internal talent and the capability to develop something like a mobile app and a first-party digital solution, and this is a situation where they also opted to partner with you on the digital side. You know, is that emerging, where you're seeing even the most competent digital organizations still, you know, look to partner with you? You know, is mobile something that you see a lot in your customer base? And then where does mobile fit in the footprint or the product vision for the company long term? You know, 'cause it's within the digital footprint, but- Yeah. Actually, the mobile component of it is not new. The mobile component is actually what the company was founded upon. The insight, the intervention of Olo back in 2005, was mobile is going to be the channel of choice. Even back before iPhone, we were doing text message ordering, we were doing mobile web ordering, but the idea was, this device is gonna become a remote control for buying things, and guests are gonna wanna use this to have a better, faster, skip-the-line kind of experience at restaurants. What I love about what Dutch Bros is doing is pulling that experience into the drive-thru service model. Mm-hmm. And that's important because drive-thru is still 37% of overall transactions in the industry. It's the plurality of transactions in the industry. It's hundred percent analog. I mean, there, there's very little digital happening, and leaders like Dutch Bros are really leading the way. Olo, since we offered mobile apps of our own, we've always offered an API that sophisticated brands can build into a larger set of capabilities in their mobile app or have a third party do that for them. And it's why that partner ecosystem of 400 integrated technology partners, some of those are loyalty providers, some of those are mobile app developers, but they're utilizing our core competency of digital ordering in that example of Dutch Bros, to do something that they've never done before. I would argue that the service model has really never been done before, and showing others the way of a great digital experience through mobile in the drive-thru. Mm-hmm. And that, like, kind of leads to my next question around, you know, this fascinating innovation that's happening in the drive-thru. You know, a lot of implementation and application of AI at some of these brands. You know, how do you see some of these implementations as bringing digital within the four walls? Because right now, I would hazard a guess that a lot of the digital is take out and off location. Mm-hmm. But, you know, going to your conferences, talking to these customers, they're really thinking about on-location digital as something that is pretty new for them to experiment with. Maybe just walk us through what's most promising there, what's interesting there, you know, five years from now, ten years from now, what might the digital within four walls opportunity look like? Yeah, we believe it is a win for the guest experience and a win for the operator experience and profitability to offer more digital experiences to the guests, inclusive of those inside the four walls experiences. The drive-thru, not exactly within the four walls, but on premise, so we'll- Mm-hmm ... include that. On-premise, still about a quarter of all transactions in our industry, also largely non-digital. That's changing rapidly. You have QR code ordering that some brands are using. Now, I want to be clear, I'm not talking about QR codes to look at menus, and that's it. People get very frustrated with that, but actual QR codes to go and place the order and pay and have the order run out to you. Mm-hmm. Brands like Nando's are doing a great job with that. We have a lot of interest at this moment in time, and I think some of this is in reaction to labor regulations around the nation in kiosk deployments. Mm-hmm. Kiosk deployments are fascinating because, you know, we have a partner, I'll mention by name, Bite Kiosk, that does this really cool facial recognition with a guest opting into it, to recognize you from your last order, what you got last time, and then make a data-driven recommendation of another item that you might like. We showcased an example of that in a futuristic video that we put out in March of last year, and everybody that we talked to said, "That's really cool, but that's so far into the future." And then we announced that partnership on our next earnings call, that it was live to the world, and it's exciting to see operators getting really excited, brands getting really excited about enabling those experiences, and also guests loving those experiences and choosing them over waiting in a line to go and speak to a cashier who might mishear their order, misenter their order. But almost no matter what, in the enterprise space, starts with that transaction with no knowledge of who that guest is. That anonymity of a guest and the idea that every guest is treated like they're a first-time guest is anathema to what we believe is true hospitality, where you can make every guest feel like a regular by bringing everything that you know about them to bear, to give them that personalized experience that has that historical context of how they've used you in the past. And implementations like QR code and kiosk, while they're great digital channels and they are great for labor efficiency, they can also be great for delivering that personal hospitality through the platform inside the four walls. Yeah, I'll certainly speculate that I think that AI in the restaurant space will surprise people based off the fact that a lot of this technology is pretty fundamental and proven, and it's just about stitching it together. And this industry has to work through a lot of different issues to be able to adopt technology quickly, but these are not technical hurdles. These are, you know, industry inertia hurdles and just getting the message out, so. Just one more point on that. I mean, I think specific to the AI point, there's a lot of attention paid to voice ordering AI in the drive-thru. I think that was the origin of the question. And that is exciting, and we're working with a lot of partners in that space. I think it was two years ago at this conference that I was talking on stage about some of the work that we're doing in the back of the house. Mm-hmm ... and optimizing kitchen production based on all the orders that are happening in real time, and using machine learning to predict how long an order will take to fulfill, to give an accurate quote time to the guest, and how many more orders a restaurant can responsibly take and fulfill in their kitchen without disappointing a guest. Mm-hmm. That product is called Order Ready AI. It's been out for at least two years now. We're using AI there. We're using AI in our payment solution for fraud scoring and authentication. We're using AI in our marketing tool set in Olo Engage extensively in automating messages. AI has many, many uses in this industry, and I think some of those that get the most attention are the things that I happen to be least excited about, but you know, there are other great examples- Mm-hmm ... of how AI is going to have a big impact as this industry goes more digital. Yeah, perfect. Well, let's certainly turn to pay. Been an exciting few years for pay. I mean, basically, it's $0 in 2021 to now target $60 million, mid-$60s for 2024. You know, Peter, maybe you could talk about, you know, the friction point in pay, and maybe how was there an opportunity to provide payments in the business? You know, like, it seems maybe that there was an opportunity to layer on payments to digital ordering, but there's been more here than just adding another revenue opportunity. So maybe some background on the strategy of Pay. Yeah. So, the emergence of Pay was in large part in conjunction with what we were hearing from our brands in terms of some of the pain points they were experiencing with their incumbent digital payment processor. And things around, fraud issues, chargeback issues, as well as, authorization rates, and seeing transactions fail at rates that were, intolerable. So ultimately, we launched Pay in twenty twenty-two, in Q1 of twenty twenty-two. That first year, we did about $6 million of revenue. That grew to $30 million of revenue last year, and now we're on pace to do mid-$60 million, this year. One of the things that we had done in conjunction with the announcement of Olo Pay was develop a capability called Borderless, which allowed guests to store their information, including payment credentials, at the Olo platform level, such that any time you subsequently checked out at a Olo Pay Borderless-enabled location, you could do so in single-factor authentication, enter in your email or your phone number, you get a challenge text, you hit that link, everything prepopulates. That did two things: One, that really increased the cart conversion, so the ability for folks to convert faster and at a higher rate, as well as allowed brands to know who that guest is. So before the announcement of Borderless, usually about a third of guests would check out in a logged-in state, which meant brands did not know who their guest was, who was checking out. That dynamic completely inverted with the announcement of Borderless, and now over two-thirds, I think the latest number is over 70% of guests, are checking out in a logged-in state. So not only are you converting guests at a higher rate, which is good for business, you're now also knowing who that guest is. So really, what we did was we took what was kind of a very tactical, you know, pain point and turned it into a real strategic value add by using both the payment processing capabilities along with that platform-level innovation. Yeah. And I just want to make sure to cover up on one thing. I think earlier we said two point five or around 2.5 billion of gross payment volume. That's what we're forecasting for this year, around that, up from $1 billion last year and up from $250 million of gross payment volume in 2022. So to your point, just growing rapidly, and it's growing rapidly not just because we're out there talking about it, but because brands are really seeing the value, and to Peter's point, seeing it not just as something that's tactical and a commodity of, "Oh, I need a payment processor, I could pick any one," but, "This uniquely provides me with more guest data," and that is the currency of our time. You know, before turning to Engage, I wanna be able to touch on card present. You know, maybe could you kind of give an overview of where we're at in terms of a general availability of addressing, you know, not the e-commerce transaction, but the card-present transactions, and how that might change the already, you know, pretty significant growth trajectory of the business? What might change on a margin perspective as well for card present? Yeah. So, last year, platform-wide, we processed a little over $26 billion of GMV. Industry-wide, about 18% of transactions today are digital, which means there's about six times more transactions that are non-digital. And the way to think about that distinction, digital versus non-digital, is really card not present versus card present. So today, that $26 billion of GMV is really the card not present opportunity, which means there is a 6X opportunity just within the install base, that it would be addressable as card present comes online. So really, the immediate SAM is more like $160 billion. So while the $2.5 billion of GPV is a, is a great, you know, is a great trajectory, great milestone, it still represents, you know, a little over 2%-ish of the total SAM, once card present is available. Where we are at this point is we are in production in terms of developing the integrations into the three POS partners that we announced, NCR, Qu, and Toast POS. And in conjunction with those announcements, there's really two integrations that are happening. There is a payment integration, as well as a data integration, which is going to allow us to not only process the payment alongside the POS, but understand what is happening on the POS in terms of order detail and menu items, so that we can combine that with the payment transaction to then enrich the guest database, and what that then provides is the brand, that full three sixty view of the guest, whether they're transacting on premise or off, which is really a true unlock, so really taking what we've done strategically for the card not present use case, and bridging that gap into the card present use case. Let's make it about guest identification and acquisition, not necessarily just payment processing. From a margin standpoint, right now, we are high single-digit margin on card not present. The plan is to grow into that 20% gross margin target, and card present is a big portion of how we do that. Yeah, makes a ton of sense. Last minute here, wish we had more time, but let's talk about Engage. Marketing solutions are pervasive. There are many options in the world market, and so what I wanna specifically maybe talk about is, how a vertical solution helps brands in marketing. You know, what are the pain points that they're trying to solve that they really don't find a solution with a horizontal vendor, and how Engage is helping solve that? Yeah, I think this is part of our belief system at Olo, that vertical is better than horizontal for the restaurant vertical. That there are integrations that we have done with all of our partners, with all the Engage partners, that are restaurant-specific, that horizontal providers just haven't done, and without having to start from scratch and build all of those, brands can just get time to value much faster. And there are proven playbooks that other brands have used. Sitting where we sit, kind of view every brand that we work with as a Petri dish. We're learning, and we can find best practices that we can then share across our customer base. That role of Olo as digital consigliere for enterprise restaurant brands is really why you see us having the gross retention rate, the net revenue retention that we have, which I think is phenomenal. 95% gross retention rate, 120% net revenue retention for several quarters now. Really best-in-class stuff, because our brands rely on us for insights and advice from our vertical expertise. All right. Well, Noah, Peter, I think we're out of time, but thank you very much for making it to Nashville, and thank you for the conversation. Thanks for having us. Thanks, guys.