Mike Townsend: This interview is with Caleb Avery. He is the co-founder and CEO of Tilled. Tilled is a PayFac-as-a-Service company. We explain exactly what that means. They've raised about 30 million and they sell into software companies that. Then sell intobusinesses. So his background is all in payments. He has created a ISO, a salesorganization selling merchant services or credit card payment processing.

Mike Townsend: We talked about thatworld, what it looked like, how he at, I believe 19 years old, he was able togrow a business with over a hundred employees selling. 10,000 differentbusinesses, or at least going door to door to 10,000 different businesses,selling them different credit card services. We talked about the trajectory ofpayments and what they are doing to influence that really excitingconversation.

Mike Townsend: Caleb knows a tonabout the payment industry and in particular, the payment processing segment.So I hope you enjoy and learn something as I did. Please do give us a thumbs upor share this video. If you do enjoy this conversation here is CalebAvery.  

Mike Townsend: All right, Caleb. I'mexcited to chat with you more. We've been having a few minutes of greatpre-show conversation, but I'd love to just kick this off with your background.You're talking about your business prior to what you're building now at Tilledin the ISO world. Paint me the picture of like what ISOs are, why they'rerelevant in payments and how things traditionally have been structured. Andthen that'll catch us up to what you guys are doing. Where things go fromhere.  

Caleb Avery: Sure. So first off,start with the acronym. So ISO being an independent. Organization. That wasreally where I started my career. So at 19 years old in Greenville, SouthCarolina, going door to door selling payments to, to small business owners.

Caleb Avery: And when you thinkabout the payments ecosystem from a distribution perspective, that traditionaldoor to door ISO sales model, Is really what the payments industry is bestknown for. Someone say infamous , you know, for, for that side of the, thebusiness, but for me, you know, started going out door to door, selling paymentprocessing services to, to small business owners, eventually scaled up thatbusiness to, to pretty Sable scale.

Caleb Avery: We now have agents inall 50 states across the country. And after scaling up that business, I startedconsulting for software companies. And so for me, I started working with thesevertical software businesses anywhere from a hundred million up to about abillion dollars. In annual processing volume. And that shift in the, theindustry is, is something that has been happening for, for about 10 years, butreally has accelerated over the last few years.

Caleb Avery: And it was working withthese software companies that are really starting to see a pretty significantgap in the market where a lot of them were starting talking to companies likeStripe or, or Braintree, and just passing along the, the payment fees ontotheir customer. But at some point they reached the scale where they reallywanted to start monetizing the payments flowing through their ecosystem.

Caleb Avery: And that was reallywhere I started to enter this conversation was where these software companieswanted to start generating revenue on their payments. And it was at that pointin time that these companies faced this like existential question about whatdirection to go with their payment. Processing systems.

Caleb Avery: And usually most ofthese companies would start working with the traditional processors, the ISOs,and start to, to form referral relationships with these businesses. And theproblem with that traditional ISO model within the, the software ecosystem, onefrom a technology perspective, a lot of these ISOs and acquires haven't updatedtheir payment technology in 10, 20 years.

Caleb Avery: And then from anactual merchant signup perspective, you're going from this instant digitalStripe boarding experience. To a PDF application process. So, you know, you canimagine for a modern software business, the last thing that they want to do ishave to email their client a 10, 15 page PDF document for them to sign, youknow print out scan and send back to them with all of these supportingdocumentations.

Caleb Avery: And so it just createda, a really clunky experience for a lot of these vertical softwarebusiness.  

Mike Townsend: Tell me a little bitmore about the, the industry of these ISOs. So why my understanding and helpfill me in on the gaps here is that prior to credit cards, and I think theeighties, maybe early nineties, people used to just pay in cash.

Mike Townsend: They pay in a check.And then the problem was that some people who deposited a check, the checkswould bounce. And so the bank card, there was a bunch of banks that gottogether and said, we're gonna create a debit. And then that allows you toinstantaneously check the balance of the bank account. So people can't writebad checks.

Mike Townsend: That was the initialimpetus for it. And then it was like, Hey, instead of just debit, we can docredit and then we're gonna charge. So I think they initially charged merchantsto use the debit card. I think maybe they still do today. I don't know. Butthen they just kept that same model and charged for the credit card.

Mike Townsend: And then they needed away to. The credit card installation, like the actual hardware terminals andthe wiring and all that. And that's where the ISO, so these like groups ofsales people started to just go out cause they could mark up the cost pertransaction from like 2.5 to 2.7 and they, they could get residual income.

Mike Townsend: So that, that is thatthe general structure. Am I missing anything?

Caleb Avery: Yeah, let's, let'skind of take it all the way back to, to the beginning. You know, when you thinkabout some of the, the benefits of credit or, or debit card processing, youknow, from a, from a merchant perspective, one you're right. You have this,this instant ability to.

Caleb Avery: You know, whether theconsumer is able to pay for the, the goods or services, you know, that, thatyou're transacting. There's also confidence that you, as the merchant are goingto be able to receive that money into, you know, your, your bank account. Ifthey're paying by check, you're not sure if they're good for it.

Caleb Avery: You're not sure ifthey're gonna call in and, you know, say, Hey, I, I didn't , you know, actuallywrite that check. This is fraudulent. You get a, a returned you know, check.And so you have this. Confidence that's built between the, the merchant andthe, and the consumer and, and really companies like visa, MasterCard, discoverAmex are, are that brand that instills that confidence in that transaction.

Caleb Avery: But the question is,you know, how do the card brands make sure that every merchant in America,every merchant of the world has that ability to accept. You know, credit cardsand, and you're right. The, the ISOs have historically been that distributionchannel the feet on the street distribution model to get credit card processinginto the hands of as many merchants as they can because you you've got thesenetworks, these, you know, visa, MasterCard, discover that aren't in thebusiness of going out and selling services to individual merchants.

Caleb Avery: You as a merchant alsowant the ability to be able to accept all of the, the different. Types. So youwant to be able to accept credit. You wanna be able to accept debit all thedifferent brands, all the different debit schemes and. you have sponsor banksthat were set up that had the, the direct relationships to the card brands, andthen you have the acquirers.

Caleb Avery: And so that, thatnetwork of the, the sponsor banks and the acquirers really formed the backboneof the, the payment processing ecosystem and, and really are like the pipesthat all of the transactions flow through. And then the ISOs have really been avery profitable, very scalable distribution channel for the banks, for theacquirers to get this product out into the market.

Caleb Avery: At least historically,I think you're starting to see a lot of disruption with that model, but it'sbeen an absolute cash cow for, for decades for anybody involved you know, inthat side of the acquiring ecosystem.  

Mike Townsend: And, and is this the,is this model, the, the referral sales. Model is this what made visa,MasterCard so successful or had they been successful prior to this?

Caleb Avery: I do think it's alarge part of it. I mean, yeah. With any business distribution is key. Likefor, for visa, MasterCard, they want the acceptance of, you know, their brandedcards to, to be ubiquitous. And so for them, there's really two sides. To thatequation. There's the issuing side. How do I get as many card holders to have avisa branded card or a MasterCard branded card in my pocket?

Caleb Avery: So that's where yousee the card brands competing for relationships with the issuing banks. So, youknow, if bank of America is gonna issue a debit card or a credit card to, youknow, their millions and millions of customers, what brand is gonna. You know,on that card, that's a big part of the equation from a revenue perspective anda distribution perspective to get that card into the hands of as manycardholders as possible.

Caleb Avery: But the flip side ofthat coin is the acquiring. Of the payments ecosystem. It's one thing to have acard holder that has a visa card, but if the merchant that they're going totransact at doesn't accept , you know, that visa card, then that transactioncan't take place. And so it's really this two-sided marketplace that.

Caleb Avery: I think for one is, iscomplex. There's a lot of regulation. It's also why you haven't seen a lot ofnet new players, you know, coming into the, into the card brand space. There'sa effectively a, a, a duopoly in a sense between visa and MasterCard for dominanceyou know, especially here in the, in the us market.

Mike Townsend: Interesting. And sowhy are these ISOs still relevant today? I would think once the internet comesaround the turn of century, it's like businesses just go online. You know,they. You know, wherever they're. I imagine for them, they're thinking of it aslike your credit card is just one of many things you need to set up arestaurant or apparel store or whatever you're selling.

Mike Townsend: How, how is it stillhappening today? And what does it look like today?  

Caleb Avery: Yeah, I think oneaspect of this that a lot of people don't think about is that the customersupport side of the business. And so for you as a, as a small business owner,you own a re. That credit card terminal is, is probably 90 plus percent of howyou actually make a, a living.

Caleb Avery: And so if that cardmachine breaks or you're having issues, you know, with your terminal or yourmerchant processing service, like that is a lifeline, that is a fundamentalpart of how you run your business on a day to day basis. And, you know, if you,as a merchant want to go. You know, directly with, with one of the majoracquirers at this point in time, the, the customer service experience that youget, you know, from the big guys, leaves a lot to be desired.

Caleb Avery: And so a big salespitch for us in the early days with, with my ISO and for a lot of ISOs is, isthis idea of like, Hey you, Mr. Merchant, if you have a problem, you text me,you call myself phone number. We've got, you know, 24, 7 support teams. Youdon't have a, a three hour wait on. You know, while your card machine's downduring a dinner rush.

Caleb Avery: And so, you know, Ithink one aspect is customer support and just having the ability to providethe, the dedicated level of service that a lot of merchants really feel is, isnecessary for them to, to be able to run their business. I think, you know,thing two is that. It really has been a very successful and very scalable wayto grow for a lot of these acquirers where they've been able to set upcommission only models.

Caleb Avery: And so most, most ISOrelationships are commission only sales models with the acquirers, you know,that they partner with. And so from a scalability perspective, if I, you know,the acquire, my choices are, I can. A relatively expensive in-house, you know,W2 sales team, or I can partner on a commission only basis and you eat what youkill.

Caleb Avery: And so that model hasbeen, you know, quite successful because I think the incentives are aligned,you know, between the, the ISO who was out there, you know, feed on the streetselling. And then you know, with the acquirer, who's sitting behind the scenesand. I think another aspect of this is just trust and, and confidence.

Caleb Avery: And so, you know, froma, a merchant's perspective, yes, you can go online, you know, and there's,there's plenty of options that you can sign up for online. But do you, as abusiness owner, trust that, you know, this, this unknown entity that you'venever spoken with is going to be able to be trusted with what is a, a missioncritical part of your business.

Caleb Avery: And, you know, you seebrands like. Stripe brands like square that have been able to create that brandrecognition where merchants do have confidence that, Hey, if I go sign up forsquare, I know what that experience, you know, is going to, to look like. Butit's a lot different than like I walk into that business.

Caleb Avery: They see my face, theyshake my hand. They're able to ask me, you know, questions and really build thetrust and relationship to. You know, confident in signing up for thatprocessing service. And so I think it's been difficult for a lot of onlinecompanies to be able to bridge that gap and get, you know, customers to be ableto take that leap of faith with them to sign up, you know, via a virtualexperience.

Caleb Avery: Whereas it'straditionally been a very successful model to have that, you know, door to doorsales presence, physically speaking with merchants and helping them set uptheir equipment.  

Mike Townsend: Yeah. So in, in 2022,you're you, you started the business 10 years ago, the ISO business, which nowyou said as hundreds of people you've gone, you were saying earlier to 10,000different houses initially build up some business, not houses, doors.

Mike Townsend: So this would be doorsto restaurants. And then people say, yes, you start facilitating transactions,taking a percentage of those transactions, hiring other people to do the samething and growing. This enterprise is this at the time? Why is this interestingto you? And even then in 2012, it feels kind of late to be building.

Mike Townsend: Was that actually thesweet spot to be building an ISO or, I mean, I would think of this. Like thiswas like door to door sales for payment technology is probably like, I wouldpeg it as the eighties or nineties, but to start a business, you know, you're ayoung guy started 2000. Have it be as successful as it was.

Mike Townsend: Are we just now in theheyday or was that the heyday or how do you sort of map this out?Timewise?  

Caleb Avery: Yeah, I guess a coupleof questions in there. You know, one, what, what was interesting to, to me, youknow, about the business 19 year old kid in, in Greenville, you know, SouthCarolina, what, what was appealing about it to me?

Caleb Avery: We started summerbetween my, my sophomore and junior year of college, really going out andtalking to, to business owners. Well, almost as an experiment, there, there,wasn't initially this idea of we're gonna build this, this massive business,you know, in the, in the payment space, it was almost more like, you know, how,how do we build up, you know, beer money you know, here over the, the summerwhere I looked at getting an internship, looked at getting other, other jobsand was really enticed by this idea of residual income.

Caleb Avery: So one of the things.I think maybe a lot of people don't understand about the, the payment space,especially within the ISO model is it's really all a residual income business.And so, you know, businesses that I signed up in 2012 are still customers, youknow, with us today, I still get a monthly residual check, you know, on, onthose businesses, you know, 10 years later.

Caleb Avery: And I, I think thatthat concept of building up this residual income stream was something that,that initially was, was really appealing to me. But then as I got out there andstarted talking. You know, small business owners about some of the pains thatthey were experiencing. In the, in the market, I really felt like it was somethingthat, that we could make a meaningful difference, you know, in these, in thesebusiness owners lives.

Caleb Avery: And I think that'sbeen the case, you know, the fact that there's still customers, you know, 10years later, we've clearly, clearly provided, you know, a service to, to theirbusiness. That adds a, a tremendous amount of value where the thousands ofpeople that have walked in their door, haven't been able to take.

Caleb Avery: You know, thoseaccounts away from us. And I think as we started to, to scale up the business,there was a, there was an inflection point where initially it was, let's gohire all of our friends and, you know, get them on to, to this model. And thatwas largely a disaster. But as we started to, to recognize that there was thisopportunity to, to recruit experienced agents in the payment space and providethem a, a better overall product, a better overall.

Caleb Avery: Experience all of asudden, we, we really started to, to see a different level of scale within the,the business. And I think that that inflection point was, was pretty exciting.Just to start seeing, you know, all of these experienced agents that have beenin the payment space, five, 10, you know, 20 years just recognizing that wecould provide them, you know, a better overall experience than, than what theyhad before, because we were laser focused on that agent, that ISO experience,as we were, as we were building up our model.

Mike Townsend: So was when you weredoing this, what, the thing that made you, cause I'm thinking this is it's it'sso in a sense is so it's so prone to being commoditized because if you're anagent you're selling for five years, they're like, Why don't I just go hireother people. Right. It's kind of that like the Tupperware model where, youknow, instead of selling directly, I sell to my friends and they sell otherpeople and then there's like a cascading commission.

Caleb Avery: It's like amulti-level multi-level scheme.  

Mike Townsend: Right, right, right.And that's kind of the structure that visa, and I'm sure these banks desire,because then that. Off flows, the upfront costs and then provides residualdownstream. And then they benefit from the network effects. Was there a massiveamount of competition at the time, or did you feel you were able to like jumpin and have like the competitive advantage was what in hindsight?  

Caleb Avery: Yeah, it's, it's agood question. There was a second part of your, your last question that Ididn't quite answer, which was, you know, was 2012. The heyday is today, youknow, the, the heyday. And I think that the reality is the, the ISO world hasalways been a very competitive ecosystem. The, the, the bar to actually go setup.

Caleb Avery: A new retail, ISO isvery low. Go, go set up an LLC, get an agreement you know, with one of the,the, the major you know, acquires pretty easy to, to actually go out there and,and start an ISO. So fundamentally there's a significant amount of, of competition.In, in terms of, you know, 2012 versus today, I think that the, the competitivelandscape has, has changed quite a bit.

Caleb Avery: And it's, it's noteven just the fact that the ISO landscape itself has gotten more competitive. Ithink one of the, the shifts that I've seen is that the, the software led sideof the, the payments ecosystem is really starting to encroach on the, thetradit. ISO channel. And so, you know, when I think about what was ourcompetitive advantage at that time, and what made 2012, you know, a good timeto, to be out there selling to, to small business owners within our firstcouple of years of being online with the, the ISO one, we had the EMV shift.

Caleb Avery: And so EMV being the,the little chip cards on your, your credit or, or debit card you know, that,that you. And those EMV chip cards represented a pretty significant opportunityreally early. In our journey because there was such a small percentage ofmerchants that actually had the hardware that actually had the technology to beable to accept chip cards within their, their business.

Caleb Avery: And so we had thisopportunity to be able to go out there and, and really almost every merchant.In America was a potential customer for us as, as well as, you know, other ISOsbecause they needed to upgrade, you know, the equipment at their business. Sothat was one kind of macro tailwind that was working in our favor thing.

Caleb Avery: Two I think it waslike 20 14, 20 15 when American express came out with their opt blue program.And that re represented a pretty significant shift in, in the industry for for,for those of us that, that were in payments prior to. You know, that that opblue shift traditionally merchants got a direct account with American expressoftentimes it was separate funding.

Caleb Avery: It was separatestatements. And, and generally, you know, us as the, the ISOs and the agentsdid not earn revenue on the American express transactions, which, you know, ifyou're in the restaurant space could be 30, 40% of, of payments. And so whenAMX came out with their, their opt. Program that represented a prettysignificant opportunity for, for us, because we were able to come in here andreally for the first time negotiate and save merchant's money on their, theirAMX and then create a revenue opportunity for ourselves.

Caleb Avery: And so those, thosetwo tailwinds created a lot of momentum for us, despite, you know, quite a bitof competition in the, in the space.

Mike Townsend: So great description. Ifeel like we cover the ISO background. We have the history have how, how yougot into it, why it was exciting, how you built it, the perspective from thebank cards and the acquiring banks. How clearly at this point, you're feelinglike technology is becoming more influential in the business owners.

Mike Townsend: Day to day. LifeStripe comes out. Square comes out. This has to have shaped the ISO worldsignificantly. They're feeling like, Hey, this door to door strategy, can'twork forever. We're gonna eventually turn into the yellow pages and it's gonnamove online even then to be starting a business in 2012 and have built it tothe success you had is impressive.

Mike Townsend: Cause I think of 2012is pretty late in the game to be doing offline analog stuff. Is this kind ofthe pressure slash opportunity you felt and, and how did you. Sort of likecarve out the, were there iterations on the business model or, or did you justhave this insight? And it was like, yeah, this is it.

Caleb Avery: Yeah. I think it's a,I think it's a good question. I, I think the, the reality from my perspectiveis that for a lot of ISOs, 2012, 2015, 2000. I, I still don't think a lot ofISOs are, are really feeling that pressure, really understanding how the groundis, is shifting underneath them because in a lot of ways they're still outthere successfully, you know, signing up merchants.

Caleb Avery: I think for me, whatshaped my experience was that I started doing consulting work for softwarecompanies. And so I kind of got out of the ISO ecosystem. And so I had a muchdifferent point of view. Whereas if I hadn't done a lot of that consultingwork, I think even sitting here today, I probably still would be out there, youknow, trading up sales reps and grow.

Caleb Avery: That part of thebusiness, but you know, probably back in, you know, 20, 20 17 or, or so Istarted consulting for software companies where people would reach out to me.Hey Caleb, you're the, the credit card guy. I've got all these statements forthis business, they're doing hundreds of millions of dollars in transactions.

Caleb Avery: They have hundreds ofmerchants. They, they're not making any revenue on these payments. They have noidea how to make sense of, of what's going on within their business. And so I'dcome in and, and first off, help them understand the landscape and do a lot of,you know, what we were doing earlier on in this conversation.

Caleb Avery: Just helping themunderstand the landscape and the different options available to them, but wheremost of these software companies started in their journey was with Stripe or,or Braintree. And so, you know, Stripe Braintree. Fantastic. Solutions greatdeveloper tools, easy for you as a, as a software company to get up andrunning.

Caleb Avery: The problem is there'snot a revenue, you know, monetization opportunity for these softwarebusinesses. And so, you know, a couple years in they've got product market fit,they've got hundreds of customers, potentially hundreds of millions of dollars.They started to look at, you know, how do we go about monetizing?

Caleb Avery: The payments, youknow, flowing through these platforms. And, you know, after doing this, thisconsulting work for a few years, I was recommending you know, legacy gatewaysolutions like NMI or, or authorized.net, and then helping these guys negotiatethese ISO referral agreements with the, the big processors and the practicalreality was that the technology available.

Caleb Avery: From those legacysolutions. Plus this really antiquated merchant onboarding experience wasreally leaving a lot of these software companies in this position where theywere struggling to actually create adoption through their customer base forthis integrated payment solution. And so for me, it was January of 2019 that Ireally felt like I had this like itch that, that I couldn't scratch.

Caleb Avery: I had this idea forthis business that, you know, January of 2019. Probably couldn't have given youa super compelling pitch on exactly, you know, what that was gonna be, but Isaw pretty significant. In the market to service these ISVs and service, youknow, these, these vertical software companies that, you know, I truly believewere going to be the future of the, the payment distribution model based on alot of the, the work that, that I was doing.

Caleb Avery: A lot of the trendsthat, that I was seeing. And I think three and a half years later, you'restarting to see. You know, those macro trends playing out my personal belief,that the next, you know, five years you're gonna see a pretty markedacceleration of those trends. And I, I certainly hope that the, the ISOs and,and agents that, that may be listening are starting to pay attention to, tosome of those tailwinds because the, the industry is, is gonna be changing.

Mike Townsend: Yeah. So let's, I wantto hear an example. So if I'm a business, I'm. What's what's the most standardcase, like a restaurant, a mid-size restaurant. I have, I don't know, 10, 12employees. I'm using some software, like what would be a typical use case for asoftware vendor that a merchant would use and then...

Caleb Avery: yeah, in the, in therestaurant space, you know, let let's say, you know, you, as a, as a restaurantowner have had aloha. You know, point of sale system for 10, 15 years. All of asudden now you're starting to look at toast, you know, as, as an option, youknow, to, to run your business and the, the difference with toast, mind, bodyShopify, a lot of these software led payments. Companies is that the, the pointof sale system comes with their own integrated payment solution.

Caleb Avery: And so all of a suddenthese software companies are coming in and displacing the agents, displacingthe ISOs. They're not leveraging in a lot of cases, the, the, the ISOdistribution channel, they're going direct to merchants signing them up, andthen they have their own integrated. Payment processing solution.

Caleb Avery: So they're carving outan increasingly larger portion of the, the payments pie. I think today it'ssomething like 15% of payments in the us run through you know, software ledpayments providers where it's about 65% through the, the traditional channeland the balance being e-commerce.

Caleb Avery: But you're starting tosee that balance. Shift massively in favor of these software companies. And Ithink the, the existential question for, for ISOs acquirers banks, agentswithin the, the traditional payments ecosystem is how do you respond? To thatchanging landscape. I, I gave a, a, a speech at a, at a conference a couple ofmonths ago, talking about the death of the ISO and to, to our earlierconversation.

Caleb Avery: Like when I joined theindustry you know, more than 10 years ago, people were already talking aboutthis concept of the death, of the ISO. You know, if you were, if you wereinterviewing people in 2012, oh, Stripe O square, you know, they're, they'regonna. The, the death of the ISO. And I think that the reality is the, theconcept is right.

Caleb Avery: I think the questionis that on what timeline, you know, are these events going to, to unfold? And Ithink a lot of the, the early predictors of that shift were, were. Absolutelyspot on conceptually about the idea of this increase in the adoption of verticalsoftware, being in a lot of ways, just a much better solution for a smallbusiness owner.

Caleb Avery: So you, as thatrestaurant are getting a point of sale solution. Tailored to your business.They have lending solutions. They've got all the dashboards that you need.They've got the integrations into the online ordering providers. They provide afull service solution for you as the restaurant owner, same thing in the dentalspace, you go partner with a dental software provider that has an integratedpayment solution.

Caleb Avery: They've got all of thetools that you specifically as a dentist need to run your business. Whereas alot of these ISOs have a one size fits all solution. They're target. Liquorstores, restaurants, salons, dentists, you name it. They have the same. Hey, here'sa basic terminal, you know, that you use to, to run your, your business.

Caleb Avery: They don't have atailored solution specifically for, you know, whatever that, that niche youknow, SMB. Vertical is, whereas these vertical software providers have reallycome in and, and provided a very tailored, very catered solution that addssignificantly more value than, you know, you as the ISO or agent just going andputting a, a VX five 20, or, you know, dejavu terminal on their desk just topower the payments.

Caleb Avery: Behind their, theirbusiness. And so there's this existential question of like, how does thatdistribution channel, which today is a significant part of the, the paymentsecosystem? How does that massive, you know, part of the payments ecosystemrespond to. The, the changes in how payments are going to be distributed tosmall business owners.

Caleb Avery: I personally thinkthere's still a tremendous amount of value that ISOs and agents can add intothe equation. But the first step is for them to recognize that the industry ischanging and then ask the question like, well, how do I respond to thesechanges? You know, that are, that are happening in the ecosystem.

Caleb Avery: And I think we areseeing it at Tilled where just in the month of August, we had 26 ISOs reach. ToTilled wondering how they could partner, how they could refer, you know,software businesses to us and how they could, could work with Tilled, which wasa, a record by a million miles in terms of the number of, of ISOs, you know,waking up to, to, to ask themselves, you know, that question.

Caleb Avery: And so I, I do feelthat people are understanding, you know, this shift in the, in the ecosystem,but I feel like it's gonna accelerate tremendously over the next three to fiveyears.  

Mike Townsend: Yeah. All right. So,so basically people are going to go from offline. Knowledge and knowledgeacquisition about the, the tools that are available to online.

Mike Townsend: So then the, theconcept of door to door sales is effectively gone over the long run you mighthave right. Like I just don't think it makes like Stripe or me process, likeit's expensive to send people door to door.

Caleb Avery: It's also expensive toacquire customers with Google ads and acquire them through Facebook leads andLinkedIn ads.

Caleb Avery: And so I. Yes, it isexpensive to send, you know, an agent door to door, but a lot of the other, youknow, digital customer acquisition channels are very expensive. If not in somecases more expensive. Like if you look at the customer acquisition cost forcompanies like toast, it's pretty significant. Yes.

Caleb Avery: They're capturing moreof the long term residual revenue, because those are our direct customers, buttheir customer acquisition costs are enormous.

Mike Townsend: Would you agree thoughthat the, the trend is going to be. Ver software verticalization, such that ifI'm a bike, I'm not even going to consider a merchant processor.

Mike Townsend: That's also selling torestaurants like, cuz I need a, a piece of software to manage my shop so thattherefore I'm now looking at like 2, 3, 4 solutions at most. And what I reallycare about is not the rate of the payments, but like, can I have, you know,various models of electric bikes? Can I sell online?

Mike Townsend: Like I, I care aboutthe, the management of the business and oh, by the way they have payments. Ofcourse. Yeah. No, but that's, that's like an afterthought it's really. They'rereally comparing software based on the feature set, usability pricing of thesoftware. And then every one of them has payments integrated into it.

Mike Townsend: But that, but the, thecut, the acquisition cost there should decrease the more there isverticalization because there's just less competitors that I'm considering doesthat, does that resonate?  

Caleb Avery: So I, I fully agreewith the premise that if I am an SMB owner, as a, as a restaurant, as a bikeshop, as a dentist, whatever vertical that I'm in five years from now, why inthe world would you be partnering with an ISO with an unintegrated terminal?

Caleb Avery: I, I, I absolutelyagree with the premise that integrated payments, vertical software is reallythe, the wave of the future from an SMB payments perspective. I think aquestion that, that I have in my mind is. Is there a place in that model for anISO or an agent to partner with that, that bike shop, vertical softwarebusiness to go sell it door to door, to each of the bike shop owners.

Caleb Avery: And so, you know, my,my personal view is there is an opportunity for this distribution channel.That's been incredibly successful for decades, distributing payment processingto small business owners. Relatively low customer acquisition cost. It's aresidual commission only model. I think what you're going to see is more andmore vertical software businesses that are taking one of those two approaches.

Caleb Avery: I, as the verticalsoftware company have developed a scalable digital marketing funnel. I don'tneed the ISO. I've got Facebook ads, LinkedIn ads. I've got an insight salesteams. We're crushing it. Mm-hmm I think there are gonna be companies likethat. That absolutely scale to a phenomenal job. I think there are othervertical software businesses that aren't as well versed on payment.

Caleb Avery: That struggle toacquire those customers directly. We see it in, in our day to day business.There are vertical software companies on our platform that have no idea how tosell. Absolutely no idea how to sell payments. And they would benefittremendously from partnering up with an ISO with, you know, agents thatunderstand their vertical, that can help them get their integrated softwareproduct into the hands, to, into the hands of, as many of their target customersas possible.

Caleb Avery: So I think thatthere's, there's validity in both of those models, the commonality. Is thatthere's a vertical software company at the center of that universe. And that,that is a shift that I unequivocally believe you'll see starts unfold over thenext three to five years.

Mike Townsend: You know, there's afunny story about this or funny. Interesting. My first startup was a in 20, 2012, I started a web based like iPad based point of sale business called Zcheckout. And we were focusing on multi-location. Apparel shops. It was myco-founder was doing some consulting software development for this, thiscompany, red chapter that made clothing.

Mike Townsend: And he's like, theydon't, they can't manage it in multiple locations. It's really hard. They dotrade shows and all these things like inventory. Management's a problem. So webuilt this thing on iPads. I was even doing door to door sales, trying to growit and thinking about all these things that we're talking about.

Mike Townsend: And one of the playersin the space at the time was called Harbor touch. And they basically packaged,they took this approach that we're talking about, which is like, instead oftrying to sell payments, try to sell the, the machine, try to sell, like theyfocused on restaurants. So they're like, we're gonna sell you the devices, thehardware, like the screens, we're gonna, the software  

Caleb Avery: display, all that  

Mike Townsend: goes together and it'sfree.

Mike Townsend: You could just takeit. And the, the catch is that we're gonna charge, we're gonna upsell on thepayment processing, but for business, be an exorbitant price. Yeah. But for thebusiness, it's like, well, if it's free, that sounds great. I don't have to paycuz I got all these expenses when I'm sending out my business.

Caleb Avery: So they turn be 10 or15, $20,000 worth of equipment that, that business.  

Mike Townsend: Yeah, exactly,exactly. This guy turns out to later on, I was, I was like the whole thing camefull circle when I was watching SpaceX. Made in voyage on the dragon. I thinkit was the dragon mission where they went to the, I think what the spacestation, anyways, this guy funds the whole project.

Mike Townsend: He like sponsorspeople to go in outer space from the proceeds from Harbor touch. , you know,they didn't really highlight that four. Yeah, yeah. Should yeahs. Exactly.Right. I think it was SpaceX. I think I could be wrong of that. It might havebeen blue origin. I forget which one, but either way he sponsored a spacemission from the proceeds, a packaging payment processing together.

Mike Townsend: So yeah, there'sdefinitely something there, there. So your business is allowing Tilled, allowedsoftware vendors, companies selling into small businesses, the ability toupsell the payments and Stripe currently doesn't allow this or is that right?And what, like strategically, why wouldn't they do it?

Caleb Avery: Yeah. So strip'stypical model. They charge 2.9% and 30 cents for, for payment prostate. And soin the early days, you, as a software company, integrate Stripe into your, youknow, bike repair software, you're gonna pass through the 2.9% and 30 centsfrom Stripe onto to your customers. And. You know, why does Stripe notnegotiate?

Caleb Avery: The reality is theydon't have to they have established themselves as a market leader within thestartup space where there's really not a lot of price sensitivity. Thesestartups are more than happy to pay 2.9% 30 cents and pass that along to theircustomers because really. At that point in their, their life cycle, they'refocused on acquiring as many bike shops as they can and selling their SAS, youknow, solution to, to these bike shops.

Caleb Avery: They're not reallyfocused on the margins, the, the average revenue per unit, the, the uniteconomics. That's not the focus when you're trying to acquire your first, youknow, 50 customers. Whereas once you start to, to scale, you start to look at,you know, how do I generate as much revenue as possible? From these customers,but also how do, how do I create the best experience possible, you know, for,for all of these customers?

Caleb Avery: I think for, for usat, at Tilled, yes, a, a core part of our solution is helping these customersbetter monetize all of their payments and generate this, you know, recurringrevenue stream off of every payment flowing through their platform. But we'realso trying to help them improve their, their customer experience.

Caleb Avery: How can. Solution helpyou create a better overall experience for your customers, but also how can wehelp you scale it? And so for, for me, when I think about what we do at Tilled,our platform is called pay as a service. We're providing a paymentsinfrastructure solution. So these software companies are coming to plug in toour APIs and, and SDKs.

Caleb Avery: They're integrating ina matter of weeks, they don't need to hire employees. They don't need to takeon liability, but they're still getting this fantastic recurring revenuestream. And so technology is really at the core of what we do, but one of theaspects of our service that Stripe doesn't provide.

Caleb Avery: Sales and marketingsupport. And so we've talked a lot about, you know, how do these softwarecompanies actually scale? How do they get their product out into the hands of,as many of their customers as they can. And for a lot of these verticalsoftware businesses, they are experts in the dental space, in the restaurantspace, in the retail space, whatever their core niche is.

Caleb Avery: They are experts inthat space, but oftentimes they're not experts in. And so when it comes todesigning email campaigns, in-app messaging campaigns, landing pages, designedto help convert their customers to sign up for their integrated payments.They're not really experts in that. Mm-hmm . And so what we can do is we cancome in not only provide the payments infrastructure solution.

Caleb Avery: So they've got whitelabel onboarding, white label, you know, merchant, portals. They've got, youknow, all of the basics that they need, but it's also, how can we partner withyou to help scale your software company, to as many of your existing customersand as many net new customers as we can. So I think that combination oftechnology.

Caleb Avery: The core paymentsinfrastructure, and then the, the managed, you know, services to, to help youscale in my mind is a really key component of our pay factor as a servicestrategy. And really one of the ways that we really differentiate against strippricing aside. Cause we can blow them outta the water on pricing every day ofthe week.

Mike Townsend: And this pricing endsup being a insignificant thing. Or is that like the reason why people leave? Dothey typically leave Stripe and then go to somewhere else? Like Tilled or isit. Big companies are thinking about this. Like you said, most softwareverticalized software companies. I mean, they have to start small and then Iimagine Stripe is what they intuitively use.

Caleb Avery: I do think that thatpricing is an important component where at the end of the day, these companiesneed and want to make money. mm-hmm, on, you know, all of the, the customersthat, that they're signing up. And so, you know, if Stripe is not able to getthem to a price point where their business can create the, the type of marginsthat, that they want or that they really should have, I do think that that's apretty fundamental tenant.

Caleb Avery: I think, you know,couple other, other aspects of, you know, where, where. Struggles, I think froma branding perspective Stripe is, is pretty big on pushing the powered byStripe you know, concept out to, to their customer base. And for a lot of thesevertical software platforms, they really want to own that relationship withtheir customer and have their brand, you know, front and center with all ofthe, the merchants and, and their ecosystem.

Caleb Avery: And you don't wannahave to do a ton of custom development work to be able to build in, you know,all of the, the capabilities to have that custom branded experience to, to yourcustomers, having that turnkey white label mobile. Solution is, is prettyimportant. And then, you know, one thing that we haven't talked a lot about islike card present hardware.

Caleb Avery: And so one of the likefundamental reasons why so many software companies are researching, whetherit's tilled or card or alternative options, a lot of vertical softwareplatforms start with card, not present online payments as they're kind ofmethod. In the door to, to start, you know, working with their, theircustomers.

Caleb Avery: So take, you know, a,a, a dentist, you know, example, they start by just powering the invoices thatthe dentist may send out to their customers after the fact. So, Hey, I didn'tknow what your insurance was while you were in person for your visit. I'm gonnasend you an invoice. You click this link, you pay that's powered by Stripe.

Caleb Avery: And so that's where alot of these companies start, but what a lot of them realize is they start toscale and start talking with their customers and their customers haveconfidence in that payment solution that they're providing for that card. Notpresent piece. They ask them, well, Hey. I've still got this old terminal that,you know, some agent walked in the door and sold me, you know, five years ago.

Caleb Avery: Can you replace thisterminal? This terminal is actually where 80% of my payments volume, you know,goes through today. And so the, the vertical software companies like, well,Hey, we're leaving. You know, 80% of the money on the table on payments. How dowe add in this card present, you know, hardware terminal solution to our platformand they go to Stripe.

Caleb Avery: Well, Hey Stripe, whathardware options do you offer? For me as a software business, they're like,well, Hey, here's Stripe terminal. Okay. Well, I don't like Stripe terminal.Well, sorry. That's the only, you know, option that, that we have, you know,for you as a, as a software platform. Now I I'll caveat this by saying they'vejust bought BB POS.

Caleb Avery: And so I'm sure if youlook in the Stripe roadmap, the Stripe R and D their planning to solve for whatI think is a, is a pretty fundamental gap in their solution. But if you look atwhere they are today, That is a significant gap in their product offering for avertical software solution. That's looking to provide a full service solutionto the customers, you know, that they serve.

Caleb Avery: And so I, I, I thinkthat that combination of the, the pricing, the branding, and then the, the cardpresent piece are, are all, you know, pretty important. Factors. When you thinkabout the, the differentiation and the competitive aspect of, of what we do.

Mike Townsend: Interesting. So yeah,people go to complain about the, the Stripe hardware. What is the price? Whatis your pricing? What is Visa's pricing? I'm curious to learn more aboutpricing 2.9 plus 30 cents a Stripe. What is like, where is visa where's there?I guess that's the, that's the everyone branches and adds on from there.right?  

Caleb Avery: Yeah. So to, to kindof throw out some industry jargon here, Stripe uses what's called flat ratepricing.

Caleb Avery: Okay. So 2.9% and 30cents is what's called flat rate pricing where you as the, the small businessowner have no idea what the true visa, MasterCard discover AMX charges are. Andyou have no idea what stripes margins are. Mm-hmm . So that's the, the beautyof flat repricing is that it's simple for a merchant to understand.

Caleb Avery: They know, I process ahundred dollars transaction. I know exactly what it's gonna. I know exactlywhat that. A hundred dollars charge is gonna cost me $3 and 20 cents. I justknow 2.9% 30 cents. The problem with that is that on average, it'ssubstantially more expensive than if you're doing interchange pass throughpricing.

Caleb Avery: And so interchangebeing the direct pass through cost from visa, MasterCard, discover AMX. And sothese are the, the pass through items and the, the beauty of an interchangeplus model is that I tell you what my markup is. I say, Hey, I'm gonna charge you10 cents. 25 basis points are, are a quarter of a percent and, and $8 a month.

Caleb Avery: And so the advantageis that you, as the small business owner know the cost basis, you know whatvisa, MasterCard charged you, cuz it's passed through mm-hmm you understandwhat my markup is? Cuz I'm telling you upfront. This is my fixed markup that Icharge over the, the interchange plus cost. The struggle.

Caleb Avery: When you go back tothe, the distribution model of door to door sales versus online, Hey, I clickedan ad and you know, I'm gonna go sign. Most merchants intuitively haveabsolutely no idea what an interchange plus pricing model is. And so unlesssomeone's in their business explaining to them, Hey, here's what you're payingtoday.

Caleb Avery: Here's what I wouldcharge you. Here's what the savings are. They look at that and they're like,you're making these terms up. This is not a real thing. I have no idea. Youknow what you're, what you're talking about. Flat rate pricing is. You know,for, for them to understand, but the reality of interchange plus pricing isthat really gives them the ability to have transparency and maximize the, themargins.

Caleb Avery: And so for us, we passthrough typically our wholesale interchange plus buy rates to the softwarecompany. We allow them to set the pricing to their merchants, to theircustomers. If they wanna do flat rate pricing, they can, if they wanna dointerchange plus pricing, they can. And then our typical model is to rev.

Caleb Avery: The Delta between whatthat merchant, what that small business owner's paying and then what the truewholesale cost of processing is. And so it's a, it's a full kind of openkimono, you know, transparent model for these software companies where theyknow what our margins are. They know what the cost is, and they're able tocontrol the pricing.

Caleb Avery: To their customers.And so it really puts them in the driver's seat over their model, over theirpricing, over their margins to, to really be able to, to drive and scale thatpayments, revenue opportunity within their business.  

Mike Townsend: Is the pricingtransparent? What, what, what if Stripe is 2.9 and 30 cents?

Mike Townsend: Where are youguys?  

Caleb Avery: So in terms of ourkind of typical cost if you think about the, the average merchant paying 2.9%and 30 cents, usually there's about 80 basis points. So 0.8% of margin whenStripe is charging that, that 2.9% and 30 cents. And so if we're giving, youknow, a, a pass through of our, our wholesale cost and then offering, you know,let's say two-thirds 66% of the revenue to the software platform.

Caleb Avery: That's half a percent.Or 50 basis points that that software company is leaving on the table bypartnering with Stripe and for, for software companies out there, when youstart to do that math, you're like, well, I do a hundred million dollars in, intransactions, you know, every year on my platform, you know, how much money amI leaving on a table?

Caleb Avery: You're, you're talkingat least half a million dollars in margin, you know, that you're not earningacross your, your current customer base, which for some software company isactually equivalent. If not more than their SAS revenue stream. And so you'resaying, well, Hey, I could double my margins or more than double my margins.

Caleb Avery: you know, by adding inan integrated payment strategy like that is the practical reality of what a lotof companies have found by implementing an integrated payment solution. Youlook at the public examples of, of toast and, and shop. They are making, insome cases, four times as much money on payments than they are on their coresoftware product.

Caleb Avery: It, it is a highlyprofitable, wow. Endeavor to integrate in payments if you do it well.

Mike Townsend: Do you think the,this, I mean, it sounds expensive 3%, basically for a merchant to, to run theirbusiness. I would imagine some percentage goes to fraud. So people steal creditcards, they buy shit online and then they go to the merchant and they say, Hey,what happened?

Mike Townsend: And it was fraud. Andso. The credit card company or the merchant, usually the merchant I believe,has to pay for that D and that is what I mean, do you think apple pay and facerecognition, fingerprint recognition start to eliminate, like push it to nearzero credit card fraud, at least for in person transactions.

Mike Townsend: And does that have anyeffect or is that just, is visa, MasterCard just gonna absorb that income aswell given  

Caleb Avery: Yeah. So oftentimes itis the merchant bearing the, the brunt of, of that responsibility. The, thecost of, of chargebacks to, to the, the second point that you made apple payalmost does eliminate fraud for, for, in person transactions.

Caleb Avery: One of the, the hugebenefits of encouraging merchants to accept more, more contactless and, andapple pay. Transactions. And so I, I definitely think that, you know, when youlook over the next kind of five, 10 years, there's going to be an acceleration and,and an interest from the, the card brands in trying to encourage different waysto help reduce fraud, whether that's 3d, secure, apple, pay some sort ofbiometrics or two fat, like there, there's a lot of different options for howyou can create a more secure process for, for process.

Caleb Avery: You know, cardtransactions. I think that the reality is that creates. Opportunities for, forcompanies to, to come in and create a piece of the pie. Apple pays highlyprofitable. Yeah. For, for apple, I think it's like 15 basis points that theymandate any, you know, issuing bank that, that operates on the, the apple paynetwork to, to leverage them.

Caleb Avery: So that's. That's asignificant revenue stream, you know, for them, but they're also providing agreat service, you know, for, for merchants where it's convenient me as aconsumer, I love paying you know, with apple pay. And if I were a merchant, II'd much prefer to have a hundred percent of my transactions.

Caleb Avery: Yeah. You know, runthrough, through apple pay. Cause you're, you're substantially decreasing your,your risk of fraud.  

Mike Townsend: I mean, they must, Idon't know what the, the average fraud numbers are, but for in person andonline, I don't know. I would imagine. Online is higher. I don't know whichone's sorry.  

Caleb Avery: Online's definitelyhigher.

Caleb Avery: It varies a lotdepending on the, the industry and the, in the business type. And so I thinkone of the things that, you know, we see given our kind of horizontal positionin the, in the, in the space is that there's a pretty big Delta betweendifferent industries. You know, when you look at at chargeback rates and, and,and fraud rates but there's also a lot of opportunity for, for these merchants.

Caleb Avery: There's a lot ofcompanies out there now that are targeting exactly this solution and providing,you know, AI and ML based solutions to help counteract a lot of the, thetypical risks that especially online merchants, face processingtransactions.  

Mike Townsend: I'm surprised we'renot already there with online transactions.

Mike Townsend: Like when I go into astore, a grocery store and use apple pay, it's like face I. Check, you know,thing, the thing it recognize all like completely automated. And then when I goto a website I'm using all Mac hardware and it's like, enter your credit card. AndI'm sure apple is either working on this or already has it.

Mike Townsend: And I haven't upgradedyet, but it's like to have a fingerprint ID, like have a, have the internet beentirely biometrically payment secured. That has to be its top priorities.Something you're seeing?

Caleb Avery: Apple does have that,that capability. So you can, you can integrate apple pay into your MacBook.Mm-hmm . If you've got a, a, a more recent MacBook, they do have the, thebiometric scanners.

Caleb Avery: So you can leveragefor, you know, websites that have apple pay enabled. You can leverage. Thattechnology. I think there's two things. I think one there's, there's an issueof like ubiquitous, like technology adoption. And so that's where technologyproviders like till help more software companies, more merchants embed, applepay capabilities within their site.

Caleb Avery: I think, you know,thing two is like, what's the appropriate level of friction at that at, at thatcheckout experience. And that's something that. I think a lot of merchants and,and software companies really struggle with like the appropriate amount offriction in the checkout process, because if you get it wrong and you've gottoo tight of a, of a reign from a fraud perspective, you're just turning downsales and you're literally giving away revenue and the losses that you would'vehad from a fraud perspective.

Caleb Avery: Absolutely do notjustify, you know, the sales, you know, that you lost, but you have it tooloose. Then all of a sudden, you're letting through a ton of fraudulenttransactions and, you know, you're, you're creating losses that, that wereunnecessary. And so it's that, it's that balancing act of having the rightlevel of friction and the right level of sophistication on your fraud engineto, to create that, that balance and that customer experience that isappropriate.

Mike Townsend: How come I've neverseen any incentives for customers to use biometrics like you, you know, useapple pay and get, you know, To save a percent save, like have some incentiveon the customer side. Is that happen?  

Caleb Avery: So I think one of thechallenges is that the merchants today are the ones bearing the cost of creditcard processing.

Caleb Avery: And so it's like forme as a consumer, like why do I care? And so for a merchant, like they're theones that are incentivized. They're the ones that are paying the cost of creditcard processing. Mm-hmm , they're dealing with, you know, the chargebacks for,for me as a consumer, it's a con. I get my cash back, you know, by paying withmy, my credit card, I get charge back protection.

Caleb Avery: I have all of. Youknow, benefits, but there there's no, there's no liability. There's no cost.There's no concern. You know, for, for me, I do think that where you're seeingthis acceleration of, of dual pricing cash discounting surcharging or some ofthe names, you know, that are, that are being thrown out there, it isencouraging consumers to be more conscious of what type of card they're using,you know, in the checkout environment where if it's a surcharging model, Hey,if you pay by debit, Then we're not gonna assess this additional 3% or 4% or.

Caleb Avery: You know, crazy ratethey're adding on for the, the surcharge. We're not gonna assess you thisadditional fee. And so it actually makes the consumer aware for them toactually make that decision at the point of checkout, like, Hey, do I want topay an extra 3% just to pay with my credit card? I personally don't.

Caleb Avery: If I, if I'm in thatenvironment, I'm paying. Yeah. You know, by, by debit card, depending on whatit is, you know, that I'm buying. So I, I think you're starting to see, youknow, some of that behavior and incentivization creep in to the checkoutenvironment, but by no means, is it, you know, ubiquitous in its adoption.

Caleb Avery: I think there's a lotof merchants out there that are really hesitant to, to Institute that, thatdual pricing model for fear of, you know, potentially, you know, shutting awaycustomers that, that don't like them pushing that cost downstream.  

Mike Townsend: So you guys haveraised about 30. Is that right. And where is crypto on the roadmap?

Mike Townsend: I mean, cryptoprovides incentives with faster. Maybe not, maybe it's not speed. It's notgonna be speed because the, the rails are really quick now. So it's gonna be ontransaction costs. You know, you could trade on a lightning network for farleft than 2.9% or, or some other chains as well. This feels like aninevitability, like the oligopoly of, you know, visa, MasterCard.

Mike Townsend: Can't just sit there,leaching off two and a half percent on the world. Forever crypto I've talked tosome people who are like, this is their life's mission to integrate crypto intomerchants. Are you seeing it on either the consumer side, the software side?  

Caleb Avery: Honestly, no, and Ithink there's, there's a couple of issues.

Caleb Avery: I think one from aconsumer demand perspective, consumers are not yet really wanting to pay withcrypto for a lot of consumers, myself included, like I have crypto, but I'mholding it. It's an investment. I'm not really looking at this as, Hey, I wantto go into a small business and pay with my Bitcoin.

Caleb Avery: Cause I'm holding ontoit. That's an investment mm-hmm . So I think that the first problem that youhave is really a level of demand and interest from consumers and. Partlybecause of that, I don't think that you have a lot of technology anddistribution right now to get the right capabilities, to create that acceptanceat the merchant level.

Caleb Avery: And so just as visa,MasterCard, discover had to figure out how to distribute their product 30, 40years ago to get it out in the hands of as many merchants as possible. There'sthis two-sided marketplace as well for crypto. So how do I create the demand?Or I guess maybe the supply from a, a, a consumer perspective that I want topay with crypto, and then you've got the other side of the equation.

Caleb Avery: How do I make sure asmany merchants as possible have the ability to have a frictionless checkout experience?Because if, if you've like me tried to pay, you know, for anything with cryptopreviously, like it's, I can't figure out how to do it. It's just a complicatedfriction filled, you know, checkout experience.

Caleb Avery: And so until you. Youknow, those two pieces of the equation solve, like the flywheel doesn't turn asit does today with, with cards where you've got mass adoption from a consumerperspective and it's easy. I just, Hey, here's here's my card or put in myfingerprint or, or face ID. And so it's just, it's just easy.

Mike Townsend: Yeah. Yeah. I thinkthat's right. I think it's gonna be an emergence in other countries. First, theus is a pretty robust us payment system. It could also be pressure from the usdollar with inflation or, you know, drastic inflation that people are like,okay, I wanna move off. But yeah, it's exciting. Good thing.

Mike Townsend: Good thing now toradar. Interesting to hear, you know, you're not really seeing it in the. Cool.Anything else? Top of mind, do you wanna throw out your personal Twitter oranything on the personal side we'll have links for all the till stuff?  

Caleb Avery: Yeah, not, not, notbig on Twitter. I think LinkedIn is LinkedIn the place to, to find me veryactive on, on LinkedIn.

Caleb Avery: So if you'reinterested in following, you know, me personally or learning more about, youknow, what we do until LinkedIn is certainly a great place to start to, to getup to speed on what we do and then shout out for, for, till. Website T I L L ED dot com fantastic place for, for both software companies and ISOs and agentsinterested in learning more about what we do.

Caleb Avery: But Mike reallyappreciate you having me on the, the podcast today. This was our inauguralrecording and the, in the Tilled podcast studio. So excited to, to finally putit to, to good use and really enjoyed the, the time here with you today.  

Mike Townsend: Yeah, this is fun.Thanks Caleb chat soon.  

Caleb Avery: Awesome. Thanks Mike.

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