QuickFee Limited (QFE) Earnings Call Transcript & Summary

All right. I think we're ready to make a start. So again, good morning to everyone. Thank you all for taking the time to join us for the MarketEye Meet the CEO Series. I'm delighted to have Eric Lookhoff, CEO of QuickFee Limited with us today and also Simon Yeandle, the CFO of QuickFee. Eric was promoted to CEO early this year during timing. So the first Meet the CEO, we're having with Eric as CEO. So delighted to have you here, Eric. Just a bit of housekeeping [Operator Instructions]. So without any further ado, I'll hand over to you, Eric.

All right. So Eric, you've got the deck here. So I'll start here is with Slide 1. First, everyone, welcome. Good morning. Thanks for joining us. Glad to share little bit about the QuickFee story today, how our solutions serve the U.S. and Australian markets and our strategies to accelerate growth forward. We're excited to take some questions here at the end. But first, I want to send our best wishes here from the U.S. to everyone that may have been affected by the recent earthquake in Australia. So prayers for safety, good health for everyone down under. And we're going to get started. So let's see. So who is QuickFee? We're a merchant acquirer and loan originator that serve in the U.S. and Australian markets. This gives a sense of what it actually means. Essentially, QuickFee helps merchants primarily the enterprise professional service firms get paid faster while providing their clients with choice of simple and secure payment methods. And I'm going to get into many of those payment methods, how we make money and how we sort of came to be. So I'll give you a sense of the journey line here of QuickFee. So we'll do the next slide. Eric? QuickFee was established in 2009. Our Founder and Managing Director of the Australian business, Bruce Coombes. Bruce's vision was to help professional service firms, just like his own CPA practice, get paid faster for their services. The first product launch was a merchant backed lending solution. That was seen followed by a strong demand for accepting ESC bank payments and credit cards that followed after that. 2016, QuickFee was established in the U.S. with a similar go-to-market strategy and a similar set of payment solutions. And like in Australia, found a similar record of success in capturing over 1/3 of the top 400 accounting funds in the U.S. market on our platform. In 2019, QuickFee IPO, consolidated the AU and the U.S. businesses. Just a few months prior to the COVID-19 pandemic. And the impacts of that, I'll discuss here in a bit. And in late 2020, the payment suite was expanded. We included the launch of our first iteration of buy now, pay later, which is a product that continues to evolve today and we're very excited about. And that brings the story really to the beginning of 2021, my joining QuickFee as President of the U.S. business in February and then succeeding Bruce as Global CEO and joining the Board in July 1 of this year. And simply for me, my reason for joining 25-plus years in the payment space here in the U.S. across all of the parties to the payment life cycle. Everything from acquirers to processors to issuers, networks and gateways. And what was so attractive for me with QuickFee simply a burdening payments business, a wave of digital transformation that's happening in the industry that lags adoption for that. The acceleration of those ships due to COVID-19 and a dominant position in a very sticky vertical market professional services. So that's what attracted me to QuickFee to join the business earlier this year and excited to moving forward. We'll stay on this slide, Eric, to give you a sense of the primary products that we have. We really offer 2 types of loans and 2 types of payment options. You can think of it that way. Our financing product suite is traditional interest income lending with default risk borne by the merchant. I'll talk about that in the next slide. We offer a pay-in-4 installment solution that has credit risk that's backed by the available women on the cardholders' credit card. And then 2 types of things, simply banking payments, EIP or ACH, depending on the market you're in, and credit card payment solutions. And I'll talk about that as well. So we'll go to the next slide, Eric. Eric, can you move it forward to the slide. Perfect. So the financing solution is a flat interest product. There's no cost to the merchant. The firms that we deliver that solution for are paid 100% upfront. So the firm is able to accelerate the collection of their services while providing their clients -- additional clients to pay. The default risk for that is recourse to the firm for any remaining principal -- excuse me, unpaid principal balance for loan defaults. And that yields a very high credit quality in a very deep market. As I mentioned earlier, 1/3 of the portfolio of the top 400 accounting firms in the U.S. are on our platform today. And by doing business with the enterprise market, that helps to really shape down any default risk at all. The installments product, which, again, you really launched at the very beginning of this year as the initial iteration of that with our partnership with Split, is a flat percentage that's paid by the merchant and the processing fee that's paid by the cardholder that largely covers our cost of card processing with some margin beyond that. It provides a higher APR in our finance products, a turnover of capital that's roughly 3x faster than our traditional financing product and serves a different market demand than what you traditionally think of as e-commerce retail for buy now, pay later solutions. So when you think of the $180 average ticket to maybe $300 retail product for traditional buy now, pay later, we're really not focused in that space. We're not competing with those players. We're focused in the professional services space, in the commercial services space. We've seen a $2,500 to $3,000 average ticket. So we like the unit economics of that product quite a bit. And it's tailored to serve the markets that we're already in and that we're expanding to. And lastly, the P&L product, again, very simply put, we process and acquire banking payments or ACH payments, EFT payments in the Australian market. And in the U.S. market, that earns about 35 basis point yield and a credit card product that we acquired historically on behalf of a third-party processor that yields about 22 basis points of volume for that product. And with our expanded partnership that we announced a few months ago with BlueSnap allows us to develop our own card solution and extend those yields to up to 48 basis points on new volume moving forward. So we're excited about the partnership with BlueSnap, and I'll talk a little bit more about that when we get to some of the integration work that we're doing on our technology set. So we'll go to the next slide, Eric. And all of this is really underpinned by the structural tailwinds that we're seeing that helped to deliver this long-term growth. And we're seeing that in the acceleration of payments over the course of the COVID-19 pandemic and beyond. And largely, there's a lagging of the professional service base in the U.S. market to adopt digital invoicing and electronic payments as a result. That shift, when compared to a much more mature Australian market for digital invoicing, you can see the lagging there. And as that shapes forward with the integration of additional practice management solutions with the acceleration from COVID-19 more towards digital payment acceptance, we really see our product and volume grow in importance. So we're excited about that shift and not just continuing to benefit from that but really continuing to drive that shift through a number of the integration practices and work that we're doing, and we're really excited about. So I'm going to pause there. I'm going to slide it over here to Simon to take you through the next couple of slides. I'll come back on.

Thank you, Eric. Good morning, everyone. We'll take a little bit of a closer look at the traditional lending products in both markets. And there are a few statistics here around how we make money from this. On the left-hand side, the Australian market over the past 5 years in terms of lending volume. And we've seen steady growth that was impacted in FY '21 by the level of government stimulus, a lot of small businesses who tend to be the clients of the accounting law firms that we serve. There were big winners from the JobKeeper stimulus program. We didn't lose many customers and many merchants, but the demand for borrowing is certainly impacted in FY '21, and we are seeing some improvement in that demand in the latter stages of FY '21 and early FY '22. The average loan term is between 10 and 11 months, and the amount that we charge clients for that payment plan is a fact amount of around between 8% to 9%. The APR on those is in the high teens, approaching 20%. And the average loan size is -- in FY '21 was almost $14,000. On the right-hand side in the U.S., we've seen steady growth in the lending market there. And the size of long term, et cetera, is similar. We have seen some shorter loans being taken out in the past year or 2, and that obviously reduces the amount of flat interest that's charged the longer the term, the higher the actual charge of interest. So -- and again, a similar transaction size of about USD 9,500 there. So we -- as Eric mentioned, it's the client that pays the interest on these. The merchant or professional services firm gets paid immediately upfront and the service is free to them. So very compelling in terms of cash flow for the merchant. We can move to the next slide, Eric. So this is a slide that talks about our payments business in the U.S. And by payments, we mean EFT or the equivalent in the U.S. is known as ACH and credit card payments. So this is where the clients of our accounting and law firms are paying their invoices through our payment gateway. They're paying them in full. So they're not taking out a payment plan. They are paying an invoice in full. And we earn a certain amount of money from the merchant for those EFT payments, and we also collect a share of credit card revenue from our credit card processor. So the chart -- the bar chart shows our quarterly growth over the past 8 quarters. In FY '20, we wrote an increase of 131% over FY '19 in FY '21. Our total revenue was -- our total volume was USD 668 million. We generated USD 2.2 million in revenue from that. So we've shown over 100% growth in the last 2 years. And the average transaction size is around about that USD 2,000. It's important to note that we are seeing some significant growth in this area on a quarterly basis but also year-on-year. So it's very encouraging, and the market is particularly large for that. There are opportunities for us to increase that yield and increase the margin. Our cost base is reasonably fixed and processing payments through EFT and credit card. So the opportunity for margin to increase there is significant. And as I said, the opportunity to increase the volume over the next few years is significant as well. On our installments product, this is slightly different from some of the more retail focused buy now, pay later products in the marketplace. The focus -- the ticket size is probably about 10x the size, and it's very much focused on -- in the early stages when this was launched a smaller accounting and law firms, we branched out to service businesses, is very much focused on consumers who are buying things from service businesses they need as opposed to discretionary retail purchases. And through the technology we have at the moment, there is no credit application process required. The very late fees is charged to the consumers. There was a fee of between 4.99% and 6.99% charge to the merchant for the service. So it is free to the consumer. And ticket size is about 10x that of maybe a discretionary and afterpay who really focus on that retail side. So those ticket sizes are around USD 2,800. And we've got 811 merchants at the end of June signed up to the platform. Lending, it is still -- was only launched earlier this calendar year. So the volumes are reasonably small up to the end of June, USD 0.4 million to -- in Q4 FY '21. But it is growing reasonably fast. We are seeing some tractions beyond the accounting and law verticals. And as Eric mentioned earlier, because these payment plans run for about 3 months, the capital gets recycled a lot quicker than the larger payment plans in the traditional product. The APR is slightly higher as well because of those shorter plans of about 29.5%. So it is a product that, again, has -- because it's backed by credit card authority, has a very low credit risk as well.

You can go to the next slide, Eric. Great. So talk a little bit about integration here, right? And so there's a shift that we're making here in the last several months of this year, particularly around integration work. And so traditionally, the product that we've had has been somewhat nonintegrated. It's going to link that has been placed on the professional service from invoices. And so the receiver of that invoice has a simple way to click through to make a payment in selecting from the payment options we talked about earlier. The real true way we want to drive volume through this system that we created is to be natively integrated into an invoicing system, in the practice management solution, an ERP system, and really be able to drive one of the many relationships, whether it's merchant acquisition or whether it's transaction acquisition that's coming through the platform. So we launched that journey. We have successfully integrated with a number of solutions in the professional services space, particularly GreatSoft and MYOB. I talked about the BlueSnap integration that we launched a couple of months back. And then also CCH, which is a well disputed product, which the access version of that product, we tap into about 65% of the U.S. accounting space. So we're really excited about the integration work that we're doing. Part of that is making sure that we really want to be on every invoice. And if we can't be on the invoice, we want to be the invoicer for that merchant. And so that's a really important distinction for us to do the business forward. And we go the next slide. Okay. So the integration work I talked about, the Connect, was the first of a recent beta launch that we've done. That is our e-invoicing utility. So we're excited to finally have that out in beta and where that product can go as we continue to evolve that. It really becomes one of a number of integration points that we'll be rolling out here over the course of FY '22 and beyond. The BlueSnap partnership was very important for us to expand. We initially had that solution as part of our first iteration of the buy now, pay later solution. We've expanded that to being able to build out our own card product. That's how we're able to go from the 22 basis points to 48 basis points and beyond as well as migrate off of our historic legacy platform for acquiring our banking payments onto a much more robust platform with BlueSnap for that as well. As part of that, we're able to gain quite a bit of it against underwriting, fraud monitoring transactional risk management capabilities. But we do deploy for the installment products that we launch as well as we'll need it for the next iteration of our card solution, where we truly own that card volume rather than a residual commission stream for that in consulting. And then last in there is the online merchant agreement that literally just launched last week. We didn't have time to get that into the slide deck here. So we're excited that Project Kepler that we've been terming internally is our online merchant application, so we now can guide a merchant and curate them from lead all the way through merchant application and automated underwriting, automated onboarding to our platform and our partner's platform with BlueSnap for processing all in one continuous automated flow. So we're really excited about that. We've begun to see some positive deal flow already in the first 10 days since we've launched that into production and excited to continue to iterate that. But those are a number of the integration points and technology products that we're pretty proud of. And the last couple of slides here I want to just pivot to the software side of QuickFee and then really get into the payments expertise. This shift that's happened for QuickFee. And if you look at that journey I painted earlier at the top of the presentation, that's moved from a lower origination day business to a U.S. growth story payments business requires a different set of expertise, myself joining the organization in February. And since then, we've really added on a depth of expertise to the QuickFee business with our Chief Marketing Officer, Jay Alsup, who joins significant years in the payment space; Carlos Whiteman who's meeting our integration work that I've mentioned a few times; Sue Torgerson, who's driving our product strategy in financial services space. If you go on, there's a number of great talent that we brought on, both in our U.S. market and our AU market. And the most recent one that, again, didn't make the slide deck simply because the press was that we just yesterday announced that we've added our Chief Revenue Officer, Aubrey Amatelli, who comes from JPMorgan Chase. She was the Executive Director of Technology and Disruptive Commerce. So very excited that Aubrey has joined the organization and pleased that she'll be starting with us here in a couple of weeks. Move to the next slide, Eric. And lastly, just a bit on the share of value before I turn it back over to Simon on for the financial run. The core to us is our humanity, caring for our teams, with the communities in which we serve, really helping our merchants grow their business, find new and innovative ways to accelerate collection of their revenue and their hard earned service fees, while at the same time, providing their clients a choice and the time where they need it. There's a lot going on in the last 18 months around the world. We're very empathetic to that. We know we're very blessed to have the opportunity that we do, and we really internalize that in how we serve our customers, our stakeholders, each other and continuing to solve, asking first being very curious. You think that leads to the best outcome and quick evolution, and we've seen that over the last 6 months and continue to evolve the organization into the future. So I'll continue with the financial highlights, Simon, I'll kick it over to you for that one.

Thank you, Eric. So a couple of slides, if anyone had seen our financial year '21 results presentation. These are from there. If we quickly look at the U.S., which is the market that represents the largest growth opportunity to us. As we've mentioned, growth was achieved across all key metrics. Lending volumes are up 20% and PayNow volumes up 119%. We continue to see strong growth in both active customers, up 114% to 195,000 and new merchant sign-ups with 579 active merchants using our platform in FY '21 growth of 51% over FY '20. As mentioned, our payments volume has grown to USD 668 million, and that's been driven by our growing merchant base and also the structural shift online payments that Eric mentioned. It is a highly scalable revenue stream and represents substantial upside opportunity as we continue to grow and the adoption of online invoicing and payments increases and the launch of the integration tools as well as is expected to drive additional volumes both through the PayNow platform and also Lending. So we expect to see steady growth in both ACH and credit card payments to increase our focus on new merchant sign-ups, existing merchant usage for expanded sales and marketing capability and resources and an enhanced and more personalized user experience on our platforms. Take a quick look at Australia. Now certain sectors of the economy were impacted severely by COVID. However, many accountants and lawyers and their SME clients, as I mentioned, have been with us from JobKeeper and other stimulus measures. Australia's lending was impacted and was down 37% to $31.2 million. As I said, the last 3 months of FY '21 were the 3 highest months of that financial year. So we did see some improvements there. Our merchant base and customer base has continued to grow at 533 active merchants and was up 4% on FY '20. And it's being helped by new partnership signings and several new major states and national law and professional services and associations and the active number of active customers now using our platforms also rose 2%. But we're not losing customers and merchants, as I said, during the last 12 months, but there has been a lower demand for payment plans. So those results are encouraging, given the impact of the pandemic and the fact that Australia is quite a mature market for us. We do have a very stable and sustainable business in Australia. We've recently bolstered our sales and marketing teams, led by our new Head of Sales, Tony Euseff. And our founder, Bruce Coombes, is now focused solely on the Australian business, doing what he does best, which is maximizing growth and revenue opportunities around the service industries in Australia.

So I'll just take through a couple of quick slides here, and we can get to our Q&A. So next slide, Eric. Perfect. Great. So look, there's 4 pillars to our strategy moving forward. The first is all around our go-to-market strategy and expanding that as we execute upon it. The organization was founded on a direct sales model. It served us very well. We've been able to penetrate a substantial amount of the U.S. space, particularly in the enterprise professional service firm space. But in order to really expand and accelerate growth, we needed to expand the market strategy. So over the last 6 months, we've added on and stood up our ISO channel and Infinities Group, and we talked about the strategic partnerships group and integrations with independent software vendors and value-added resellers as well as the merchant direct model I mentioned with the launch here in the last week of our online merchant application flow. And that's really to expand our ability to drive merchant acquisition and payment acquisition to the model with lowering our customer acquisition costs. The second part of that is highly scalable and customized user filing processing platform. And that is really where all the infrastructure work happens. So moving off of our legacy platform, the business we sounded on, accelerating through the BlueSnap partnership and being able to build out more product capabilities, future functionality that allows us to serve the merchants that we serve even better. One of the key differentiators for us in the U.S. space is that we have a full suite of payment options, bank payments, ACH, card payments, installment payments, lending options as well. And in the commercial services, in the professional services space, that's just not something that you find in the U.S., really at all. So we're very excited about the position we have there. If you go to the next slide. Great. Thanks, Eric. So the last 2 pillars there is improving value economic model, right? It is all about scale business, and how to drive volume through that in order to win in payments. So increasing our functionality, our processing capabilities, that is accomplished with our BlueSnap expansion as well as expanding those margins that I mentioned earlier, the 22 basis points to 48 as we really become more and more of a payment facilitator. And towards that journey, we take a larger kind of bite of the transaction, the risk associated. And in accordance, we see a much nicer yield expansion as a result. And I mentioned the automated underwriting, all the fraud and the risk management, and that allows us to build out the expected card solutions and buy now, pay later iterations that we're developing quite quickly. And then lastly, I mentioned earlier about being engaged in -- you can't build and grow on payments business and particularly, and if you're anywhere else without the expertise that we've been able to attract and bring on and we're very excited about that. We're particularly having the experience that I brought to the table here, the successful exits and the scale of payment organizations across the life cycle here in the U.S. I think, is going to evolve for us. I'm very excited the good team that we put together. So -- and then lastly, I'll just close with a bit of a quick outlook here. Significant progress for the year of FY '21. We're moving quickly into the first quarter here. We're excited about the progress that we continue to make, particularly on our technology evolution, particularly around the integration work that's necessary to drive scale and continuing to drive record results here in the U.S. market. And I think the foundations here are reliable and continue to progress, and that is the digitalization of invoicing, the digitalization and growth in the commercial services space, professional services space in the U.S. towards more electronic payment acceptance will only continue to go well for us in terms of the underlying currents for our business. So we're very excited about that as well. So with that, I think, Eric, can you take it to you for questions.

All right. Thank you, Eric. [Operator Instructions] There have been a bunch of questions coming through, lots around sort of the industry and growth in the U.S., which I'll put to Eric and Simon and Charlie. I'll just start with 1 from me. And I think I probably direct to you, Eric, just around, obviously, COVID-19 really accelerated the adoption of online payments, particularly in the U.S. where it was a lot lower than here in Australia. Now that some lockdowns are finished and there may be a sense of normality, how are you seeing things? Obviously, Q4 FY '21 was a really strong quarter in terms of transactions on the platform. But anything else anecdotally that you can provide on that?

Yes. I think the COVID-19 shift, COVID may be abating, thankfully, and particularly here in the U.S. market. But the impact from a shift to digital congress will be none, and it continues to accelerate. We have a tremendous movement here in the U.S. towards work remote. So even though there's an abatement of COVID and it feels like there's greater travel and [indiscernible] travel and more movement, sort of more freedom of movement, the impacts of that from a commerce standpoint continue to accelerate despite the [indiscernible] which, obviously, we do love to see that continue to reduce. We're seeing that in the shift of existing spend from clients that our customers of our existing markets that are moving from Lending volume to PayNow volume, and we think that will just continue.

Great. Thanks, Eric. So a question here just around the payment side of the business in the U.S. in particular from Ron [indiscernible]. Does it make sense to acquire a payments company in the U.S. to focus more on the payment side of the business rather than the financing and considering the investors place higher value on payment companies.

Yes. That's a very important question. And I think there's a couple of areas of opportunity there. One, the first one, it all starts with how solid is your technology stack for processing, acquiring processing payments. And as I mentioned, there's still an evolution for us in terms of moving and really getting the full benefit out of the BlueSnap integration and that partnership. They're a white label facilitation company in the payments car loss. It basically means there's certain processing functionality and capabilities that they have in that role that we don't have that other payment acquirers, merchant acquirers, loan originators don't have. And so as you move up the chain of transaction management from simply acquiring the merchant to own the transaction and the risk to processing that transaction more directly, you get a larger share of the available income and fees that accompany that commerce. And so as we continue to migrate and evolve ourselves, then that opens up a greater possibility for acquisition of portfolio as well. The other, I would say, is we started our card journey in the card solutions that we offer in the U.S. has as a reseller as an ISO to a third-party processor there. So that volume, we receive a residual commission stream from that basis points I mentioned earlier. So if we were to acquire a portfolio, for example, we could bring that lift and move on to an arrangement that we have with BlueSnap, that automatically applies a wider yield to them. So there are some benefits that I think would accrue to us if we were to see some acquisition growth. But largely, it requires your technology stack to be at a certain set of maturity to get the benefit out of that.

Great. A couple of other strategy part questions to follow to follow-on from that. There's a question that come through saying are you able to provide any color on the statement in the yearly presentation about the expectation of consolidation within the industry. So have you got any comments to add there?

Yes. There's -- consolidation as it relates to installment, as it relates to buy now, pay later, the -- after there Square deals and PayPal's acquisition of the BNPL play in Japan recently, the firm announcement with Amazon, all of that is really tied around the e-commerce retail sector, right? And so if you look at what's happening in services world, which is a tremendously large market here in the U.S. and the world, you're not seeing that same type of consolidation activity. It will begin and probably remain in the e-commerce place -- space where you have those network effects of acquiring volume that don't necessarily exist as readily in the services area, which is one that we strategically are remaining in that space. So the consolidation is necessarily something that would affect us given the strategy in the markets that we're focusing, particularly with the dominant position that we have in enterprise professional service firms. So it's something you keep an eye on, something you certainly want to be in the flow of conversations, and we are. But it's not something that particularly is affecting us.

Great. Thanks, Eric. I'd like to follow-up to you before I put a couple of questions to Simon. Is there any -- can you provide any sort of update on further expansion plans to move into any new markets beyond North America and also perhaps even other markets and other products?

Eric, are you serving that one to me or to Simon?

It was all to you, Eric. One more and then I'll [indiscernible]

No. That's fine. That's great. I wanted to make sure I was [indiscernible] Yes. Look, the Australian business, a profitable business, we really like that space. I think you can see some -- if you're going to be in a market there and you want to own more of that market, I think there's probably more to be had in the region. We see a lot of great activity and interest in the U.K. There's -- there are -- the pipeline of integration partners that we're servicing and discussing would provide some avenues beyond the U.S. market. I think, really, we're focused on executing here in the U.S. and doing a good job of that and making sure that we win here first.

Great. And then Simon, a couple of questions are coming through on balance sheet and also cash in particular. What's the monthly cash burn at the moment? And also, what's the current cash balance? And how do you view that going forward?

Some cash at June was $21.3 million from memory. The cash burn is between sort of $500,000 to $1 million Australian dollars a month. That's obviously quite a big range. But it does depend on the flow of some of the tech we're still building as we continue to sort of build out that stack. Once it's sort of fully operational, that will taper off over the next sort of 1, 2, 3 years, but then will say there at probably a similar level for the next 12 months as we complete that build. We are super focused on cash, about getting to profitability. There's actually nothing wrong with being a profitable company, and that is what we are, our goal is. We may not be there in the next 12 months but aim to be in the years following that. So we're sufficiently well funded at the moment. We certainly don't anticipate a meeting to go to the market anytime in the next 12 months or thereafter. So we'll continue to invest in building the business and taking advantage of the opportunity in the U.S. with revenue-generating staff. We've made a number of significant hires in the past in 12 months. And we are expecting to see some real uplift in volumes from those hires, particularly on the revenue side. And as I mentioned, the level of product investment will continue to a point where we've really sort of maximized the opportunity.

Thanks, Simon. Perhaps another one for you. It's a question from [ Shane Bill ]. To what extent is the current interest cost to borrowing clients in Australia and U.S. hindering growth or scale in the lending business? And have you considered reducing interest costs to accelerate the lending book to grow sales?

So the interest we charge the clients or professional firms, we are continually trialing discount promotions. We've both trial, reducing interest rates, increasing interest rates. Interestingly enough, there isn't a huge amount of sort of price elasticity in that. The demand for borrowing seems to take precedence over the cost. But we -- absolutely, we keep very, very much on some of our operations team and continually thinking about new ways we can drive volume through our merchants and firms. And if there are some concerns about price, we certainly address them. It's -- at the moment, we're very, very focused on getting the maximum volume through because a small decrease in interest. If it's going to drive volume, we'll certainly do that. But we're not seeing it being a huge influence on the volume at this stage.

And what about the cost side timing? Anything being done there in terms of QuickFee's costs and financing?

It's still -- we are currently sort of asset-backed facilities. So we're evolving at the moment. And that suits us quite well in terms of the flexibility it affords us. We are in conversations with other lenders to expand facilities and ideally reduce the interest cost. But at the moment, it's -- the facilities we bought here are suitable for the growth that we anticipate.

Another question just came through. Any potential upcoming milestones that investors should be keeping an eye out for that might potentially be reflected in the share price? Anything to add there?

In terms of financial milestones, I'd say probably not. I mean, we continue to expect growth, particularly in the payment space and the installments product. There's a lot of traction we can get there. I think the milestones will be more in how we achieve integrations both we have software vendors and also with other partners. Yes, and there will be some further announcements about some of those deals when -- how they materialize. But they will be there, the things that will really sort of scale the volume quickly, some of those integration deals.

Okay. Just a question on competition and churn. Can you please comment on churn and whether you're seeing competitors encroaching on your existing customer base?

It's interesting on the competition side. First, the professional service firm space is incredibly sticky from a vertical market, as a vertical market. They tend to change providers not very often. What's great about the solution set that we provide to our merchants is the breadth of payment choice and options. Some of you, whether it's a bank payment, the cards payment new installment or lending, moving any one of those is quite disruptive. The expansion and integration work that we'll do, I think we'll just continue to make that even stay year. We really don't see churn at all. It's almost an immeasurable number. It's a small assignment that you had a number fill it out and then you track, but it's not something that we really look at. You have to look at competition. You're mostly thinking of innovation and wanting to stay up and stay current. Marketing strategies, those things. So we're not seeing that at all in the churn of merchants.

And in the traditional payments and lending businesses, probably single figures in terms of the merchants who have actively left us for a competitor. It's really about, for us, how we can increase the volume of those merchants. We're currently capturing in the U.S. accounting market about 14% of all merchants volume. So we'll go through our payment gateway. So that leaves 86% of that revenue of all those firms that we currently have in our books that we're not capturing. So it's about the Connect products, about trying to push as many invoices as possible electronically through our payment gateway, which will drive that volume. And that's what a lot of the integration work is that we're doing. It's about serving up pretty much 100% of invoices electronically so customers can pay them on our gateway. That's the goal.

A question just come through in regards to the Australian business and whether there's been any further impact from the second wave of COVID.

Anecdotally, we are starting to see probably some of the Australian loans just demand slightly softer. I think some of the larger loans may have been deferred. And I think that may be just due to some uncertainty around the vaccination rollout. And I think what we tend to see in these times is that a lot of the SMEs will probably scale back their spend. They'll still be engaging in the accountant's lives, but they may just be doing a slightly more sort of scaled back version of the services, just doing exactly what's purely essential rather than some of the value-add things. So the size of loans tends to become slightly smaller in these times. It's not having a material impact on the numbers, but we are starting to see anecdotally, a little bit of a kind of size contraction in the average relation size.

Yes. And what I would add to that is in the U.S. business, we're seeing just the opposite. We're seeing average ticket sizes, whether it's our banking average ticket, the card average ticket or the lending average ticket, we're seeing those exceeding our earlier expectations. So I think part of the abatement of COVID here, you're seeing a reflection of that in the increased spending.

Right. There's a couple of questions still coming through on expenditure and then obviously the expectation for revenue growth to sort of combine all those things together. So I don't know if you touched on this earlier, but the question around how much longer before the U.S. segment becomes cash neutral, breakeven. And then what's your view on all the investments and spend that the company has made in terms of seeing that reflected in growth in revenue?

I think it's important to note that both the U.S. and AU in FY '21 had positive EBITDA before our investment in customer acquisition. And the product development sort of sits as a central sort of pool of cash. But individually, those businesses, if we were to stop growing today, they would both be profitable. But we are investing -- continuing investing in new customers, investing in new technology. So we will continue to do that. We expect revenue growth in the U.S., probably to be outstrip Australia. And the revenue from contracts with customers, which is largely that payments driven revenue, we probably expect that to grow in excess of the lending interest revenue. But we expect them both to increase and anywhere and the sort of anywhere from sort of 20% to 40% growth overall in the U.S. market in terms of revenue. And AU FY '21 was a soft year for lending, but we are expecting to see some modest growth in FY '22 there. We don't earn any money from the payments business in Australia because EFT's are free, pretty much for everyone, if you're paying or receiving money electronically in Australia. It doesn't cost anybody anything, so we don't earn from that. That's why we focus on the payments numbers in the U.S. because that's where we earn the money and where the biggest upside is.

Great. A couple of questions come through just on the share price. Obviously, it's come back since the raise back in October, November last year. just going to provide any thoughts around that and obviously expectations going forward for the company?

It's always an interesting one in 2020 really as in terms of the stock market, which stay down extremely to me. But I think we'll continue to really build the business. We're still building the platform to really -- so we can really scale it up. And I think once we start delivering some of those numbers and to say some of the milestones around integration agreements, that will flow through into the revenue numbers. And at the end of the day, that's what we want to see. Obviously, run on the board. So I think once we can start doing that, the share price will be reflected accordingly.

Yes. I completely agree. I think it's all about execution on the strategy. That's what we're at down and focused on doing. And we believe that if we execute on that and what we've layed out, the suite that we have, integration that we're doing, we have leasing, the additional tailwinds that we're seeing in terms of invoice stabilization and the shift to e-commerce, the things that have happened as a result of COVID from a payment standpoint that really have become permanent all bode well for us. And it's just a matter of executing.

Great. Just a question in terms of the installments in particular of the strategy and the go-to-market and the rollout of that. You talked a little bit to that, Eric, in terms of when you're talking about the strategy. What did that look like? And how do you build the awareness levels in the market and these new verticals to grow that side of the business?

Yes. The branding awareness is key. One of the reasons why we brought on the option that we did that started in February as well as I did the marketing team pull together around that and the brand awareness is important. To build a market strategy, we've -- I'd look at our Chief Revenue Officer, we're excited about the position and the individual that's coming on. Aubrey brings a tremendous amount of experience and track record of success. So again, it kind of comes back to executing on those go-to-market strategies. If we do that, and we think we'll -- we have a very receptive audience in the commercial services space and professional services space, leveraging that deep moat that we have and 1/3 of those top 100 firms being a part of our platform. And then I think leveraging that to move, falling down the food chain in that market. The professional services space, particularly the enterprise CPA space in the U.S., a $120 billion market. We've historically only focus on the top 40. And so as we move the down the food chain with the expansion of the card solution, the standup of our ISO channel's Infinity partnerships, the integration work that we've done, the market direct model that allows us to go to that side of the market in a way that is managing and reducing cost of acquisition. We think we've got the right strategy to get there. We've got the right advantages that we can exploit that would help us get there as well.

Right. Just mindful of the time. I think we got about a minute or 2 minutes to go before we exhaust for 1 hour. So thank you, everyone, for all your questions. There's 1 here that still remains unanswered. Just from [ John ] regarding the fourth pillar, are we able to attract new tech talent? And is there an employee share purchase plan program for existing and new employees?

Look, it's -- talent, it's a very, very tight market in the U.S., particularly for payments. It's been a tight payments hiring market for at least a decade now in the U.S. We think that's just only going to continue. There's a team that we've brought together, and it's passionate about what we're accomplishing here. There's individuals that we've brought on in the last 6 months that are on their second, third, fourth organizations with me personally, a part of successful efforts that we had with a company, that payments processing business that we were able to sell to Intuit in [ 2008 ] as an example. So there's talent that we brought on that know how to scale from early growth into hypergrowth in payments businesses. And I think that team has attracted others like them. And so we're excited about the people that we've got on board. We do have an all employee options program that we launched in the beginning of the fiscal year. That's been helpful. But really, it's about what do you want to be a part of. And I think the values that we install, that we do every day, the excitement of what we're building, the excitement of the market that we're in, continually put together, that's infectious and that's brought on the talent that we're getting.

Great. One last question I've got here just around QuickFee being ASX listed. Is this the right home for the company? Should you be targeting U.S. investors also given its a U.S. growth story? So what's your view on that?

I think we are timing both given that traditionally Bruce and I were -- are both based in Australia, a lot of their focus was there. Eric, now being based in the U.S., we've ramped up our PR and Investor Relations activity in the U.S., and we'll continue to do a lot more out of these type of webinars focused on the U.S. market and also look at engaging Investor Relations expertise over there as well. But it's certainly, as we become a more significant player in the payment space, we're certainly not going to underplay the opportunity and the ability to get more investors on board.

Excellent. All right. Well, again, thank you, everyone, for making the time this morning and joining. And very importantly, thank you, Eric, and Simon, for your time as well. I'll just hand back to you, Eric, to wrap things up.

Well, look, we're incredibly excited about the opportunity that we have when I joined in February, and there's a saying that we have here that Bruce and I echo, which is aren't we lucky? And we are. We've been very fortunate in coming out of a really tough 1.5 years with COVID from a commerce standpoint. It's actually benefited and our organization has accelerated, really catalyze the shift of QuickFee from a predominantly loan origination business, which we like because of the high credit quality, in really into a significant payments opportunity really being driven here in the U.S. So we're excited about everything that's in front of us. We love the team that we put together and excited to continue to share our successes with you in the future.

Great. Thank you, everyone.

Thank you, all.

Thank you.