All right. Thank you, everyone. This is the BILL Holdings session. Thanks, everyone, for joining. My name is Tien-Tsin Huang. I follow the payment sector, and couldn't be more delighted to have René Lacerte, founder, CEO, chairman of BILL with us. We'll go through a list of questions that I've put together, thanks to the help of all the investors and all the feedback that we get. René, thank you for being with us and spending a few minutes.
Well, thank you, Tien-Tsin. It's great to be here. It's always great to come to your conference and really kind of benefit from the experience you have across the entire payer ecosystem. So thank you.
No, and we're grateful because there's so much we learn from talking to you and your peers from different parts of the ecosystem. There's a lot of changes going on, and the good news is, there's a lot of interest, and there's a lot of growth available in your core business around AP/AR, especially in SMB. So let's talk about that. But I think, you know, what I wanted to start with, René, is something that's really important to me, and it might be a silly question, but, you know, I've heard you say that BILL's in a category by itself. So when investors ask me: What is BILL? Is it a software company? Is it a network company? Is it a platform company, payments company? How would you frame it?
I mean, is it something else, or are we missing the beat entirely? I'd love to hear the, the founder's view on this. What is BILL?
Yeah, it's a great question, and, you know, I have the good fortune that we've been doing this 18 years, so I can answer briefly with, we're all the above.
Yeah.
But I'll be a little bit more specific. You know, we started with software. We are a software company at the core. We automate workflows. We, you know, save our customers time. Customers tell us they save 50%-75% of the time. That's significant savings that comes because of software. But the software capabilities we have give us the right to do payments. From day one, having been in the payments field for close to, you know, over 32 years now, we have built payments into the core capabilities of the software experience that we provide customers. And so when you look at BILL today, you know, 1% of GDP goes through BILL. In the last 5 years, it's been $1 trillion of B2B payments.
We do all of this on ACH rails, essentially, with some card spend. Vast majority is ACH rails, and that makes us a payments company, right? And it's when you combine the two of them together that you get a platform. And what we're seeing more and more from our customers is the relationship that they have with their suppliers and their customers is real. And as an operating company, and we're kinda unique in this, like, when we interact for our customers, execute a transaction for them to a buyer, supplier, or customer of theirs, if anything goes wrong in that ecosystem, it comes back to us. And this is what, again, kinda tells us we're kind of a platform, and we're a combination of a software and a payments company.
Mm-hmm.
It is why we say we're kind of in a category of our own, because we define this category of automating financial operations, and we just don't see other people doing that. Even the way we reach customers, which we'll talk about, is unique. We don't go through one channel, we go through multiple channels. We have a network of 5.8 million entities that use us to receive payments. That's a significantly large population of the business world, and we're unique in that we have that. We've built that over the last 18 years. So I would say definitely a software company, definitely a payments company, and definitely a platform.
Got it. No, this helps. That helps to frame it that way, René. But look, I mean, in this 18 years, you've scaled it quickly. You got, whatever, 500,000+ SMBs. You got still single-digit penetration, I'd say, but you are the industry leader. But, you know, when we look at SMBs and think about the problem you're trying to solve, right? How these SMBs wanna pay their bills and interface with third parties or not, it varies. It's not one solution. So how do you solve for that? I mean, you have an ecosystem, of course, and a lot of partners that help you get there, but what's the broader solution to help all these SMBs that have different views and personalities?
Well, the most important thing about serving SMBs is that you meet them where they're at. And I learned that, you know, from my parents, my grandparents, they had lots of businesses that served SMBs and accountants, and I've learned that, you know, working at Pricewaterhouse, learned that working at Intuit, I learned that with PayCycle, my first company, that you just have to meet SMBs where they're at. And so we have an approach that is unique because we go direct, where we get to get customers because they've heard about us, either through Google AdWords or whatnot, or referrals, or we go to accountants.
I think one of the things that's very unique about BILL is that the accountant channel is such an important part of the business community as a whole, and 8,000 accountants across the country will, you know, use BILL to actually build their practice. There's probably 100,000 that do some form of BILL payment and, or financial operations, I should say.
Yeah.
and we're in a position to continue to grow that, as well as continue to grow the extent of the clients that are on the platform inside of accountants. Then we have partnerships with financial institutions and now Xero and soon others. So I think the important thing that I take away is that if you wanna serve SMBs, and I think, you know, enterprise companies don't wanna serve SMBs, consumer companies don't wanna serve SMBs, it's a really hard thing to do, and it has to start with an intense passion for the SMB, not so much as caring to where you get them as much as to serving them and changing their lives and making them more productive and more successful, and that's what everybody at BILL has.
And so we've developed this unique ecosystem, again, that drives all the, you know, the opportunities that we see for SMBs across the country.
Got it. So given that ecosystem, René, how different is the experience for an SMB when they consume it either direct or through an ISV or through a bank, how do you control for that?
Yeah, at the core, there is a payments experience that is consistent.
Okay.
What changes, depending on, you know, some of the partnerships we have, is the level of advanced capabilities that the partner might bring. So some of our banks, for example, just want us to execute a payment, and one of the things you've heard us talk about is, more and more we are asking and getting partnerships where it's the whole suite of payment products and services that we have. We don't get the chance to offer the payment products and services without having all the workflow capabilities that we have. And we know that because there have been consumer-based bill payment products out there for well over 30 years. Those products were not adopted by businesses because it didn't have all the capabilities that a business need.
Mm-hmm.
I know this personally because I was building consumer-based bill payment products before Intuit, and then I started my first company, and I didn't have any of those capabilities. So we know the advanced capability is super important. So at the core, making a payment, that's the same thing. But some of the partnerships do not use the advanced capabilities, others do. What we control is the experience. What our partners control is the go-to-market. When we think about accountants, we are creating actually two experiences for them.
Mm.
One is for the SMB, and one is for the accountant.
Right.
So I was talking with an accountant last week, had 750 clients on the platform. They have 10 different teams that actually work with, you know, obviously, 75 clients each, work with BILL. Each of those teams might have a different focus. It might be a vertical, it might be the accounting and GL package they use, it might be something completely different. But those teams now have a tool that helps unify their experience and how they go serve their clients and be more strategic with their clients.
I see.
So that's different, and then in the partnerships, it really, like I said, depends on what's the core functionality that the partner wants. More and more, what we're getting is the full suite because we know that that's what drives the payment adoption and the value for the customer experience.
Got it. So in the earnings call, you talked about strong inbound interest from ISVs. Can you elaborate on what that means? I know you announced this Xero win on the accounting SMB side, which is important. How is that gonna be different than maybe what you experienced from Intuit?
What we're seeing, and this maybe goes back to the first question-
Yeah
... we've defined a category, and people see the value that financial operations can bring to a business, in sheer part because of the economic success that BILL's had, the ability to drive the revenue and the profitability. So people see that, and they kind of want to be a part of that. That has led to the fact that we defined a category, businesses saying, well, maybe they want to do that. And so as businesses decide, well, maybe they want to have a part of that and have that for their customers, what we're seeing is that people are starting to realize how hard it is. There's a regulatory compliance piece that is vast, right?
You think about being in, you know, money transmitter license in all of these states, auditors constantly coming through the shop, having federal regulations, managing the risk profile across all the customers. That's all something that our partners don't have to do. And so when we reference kind of the ISVs and just in general, software partners wanting to have more capabilities, they've looked at everything that it would take for them to go do this.
Mm-hmm.
It is not a small investment. In fact, it's a large investment, and it's not even a one-time investment. That's why I talked about the operational complexities. It's an ongoing investment they'd have to make. And when we go to them, we can say: Look, day one, you can have the benefit of 18 years of development. You can have the benefit of 18 years of refining operations and risk profiles, and you can get started earning revenue for your customers day one and providing value to your customers. And so what we're seeing, and Xero is the first example, but you know, there are many others in the ecosystem that we are in conversations with, that we see strong opportunity to create real, meaningful value for their customers, and as a result, meaningful value for them.
In addition, you know, we're seeing that even from the, you know, the existing channels we have, whether that's the banks or the accountants, there's lots of opportunity to continue to enhance those channels as well to drive growth.
Yeah. And then on the Intuit side, René, because I know I get that question a lot, you know, why would Xero be different? I'm sure you learned from the Intuit experience, which is also different.
Yeah. Well, the first thing that we're doing, it's a great question, is that we have, we've taken all the learning over the partnerships over the last, you know, dozen or so years, and we've made the APIs more modern and more consumable. Financial institutions, when we started this, wanted APIs, but then they mostly wanted them customized, and so their ability to grow with us was limited. And so what we're seeing from software, which is not a surprise, software providers, is that they don't want to build this at all. They want to build it once, the internet connection once, and then take advantage of anything that we continue to enhance in the experience. So that's the first thing, is like it's different from Intuit or the banks because of that.
The other thing that's, I would say, significantly different, is that the full suite of payment products is gonna be available from day one, except for the invoice financing that we have and the card payments that we have with respect to Spend & Expense. But all the other payment products are gonna be in there day one: international payments, virtual card, instant transfer, and real-time payments, pay by card. These are all gonna be part of the experience that the customers get from day one, and that should help drive value for the customer and obviously business for the both parties.
Yeah. Okay, good. And, and I know, René, you've referenced a lot of your past companies-
Mm
... and even what you've learned from your parents, and, you know, we always like the repeat founders, if you want to call it that. I think I said this on stage with you last year. But from all the learnings, whether it's the cyclicality and some of the changes with some of the partnerships, now you're talking about, you know, on the ISV side, working with them, is it fair to say that you can now think bigger? I mean, how big do you think BILL can ultimately be, given some of the learnings that you have and this ecosystem that you're building? Do you feel there are any limitations, or has it actually opened up in your mind?
One of the ways I think about this is, as I continue to talk to customers, and talk to accountants, and talk to partners, and talk to employees, more opportunity seems clearer today than it was yesterday.
Okay.
And that is just because, you know, the vision of serving businesses with an automation tool for their financial operations, everyone has their own version of that, and we're executing on that. So everyone in the company has ideas about how to make that happen. Everyone that we partner with has ideas how they want that to happen with their customers, and that's part of our platform. So when I step back and look at where we're at, you know, we have, roughly, on the core BILL platform, 200,000 customers. There's 6 million that have employees across the country. All of them should be doing something like this.
Mm-hmm.
And so our opportunity is to continue to drive that efficiency, the onboarding process, the ability to kind of extend and do all the different things that we do. And so I guess one learning would be that we have this opportunity, that when you continue to invest, and you stay focused on the customer, and always have a customer intentionality around what you're building for them, not just today, but for the future, when you continue to invest, when you use and leverage the grit that you have, the passion you have, the will to succeed, that that takes time. And I've seen this over and over again, and all too often, people kind of want to think just in terms of quarters, but I'm always focused on not just the short term, but thinking about decades as well.
I think that is a constant learning, that you have to have that deep passion for your customer to be able to actually think that far out and to, you know, deal with all the things that come up in the many bumps in the road.
Yeah, and turn that trust. Okay. So how would you characterize the demand environment for BILL solutions today? I know we've been going through this cycle, and all this question, has the sales pitch changed?
I would not say that. Maybe the sales pitch changed a little bit during the pandemic.
Mm-hmm
... because that was just an immediate need to kind of get online. The sales pitch for BILL hasn't changed as much as or for Divvy Spend & Expense, but what is changing is us understanding how to sell both those together and understanding how to sell a unified platform that has cash flow insights and forecasting. What we're seeing is, you know, I would probably say, you know, a year ago, we had very separate, distinct funnels. We then tried to push it all into one funnel, and now we have separate, distinct funnels, as well as a combo funnel, if you will. So our sales teams, our go-to-market teams, they're very clear about understanding the pain points customers have, so they can, that we can offer the right product and service to them.
I would say the message that we give customers is, "We can save you a ton of time." That's the 50%-75% time.
Yep.
We can help you be more strategic around your business," whether that's thinking about the spend that you've had on the AP side or managing the spend on the virtual cards side with the Spend & Expense. We can help you manage the expenses across the business, and we can help you have strategic insights. Now, that would be for the direct. For the accountant, it would be all those things for your customers, and then you get this massive scalability from a tool perspective, to see all of your customer information in one place. That hasn't changed, it's just we've added more products. Other thing we've been able to do for customers is add more capabilities on the payment products, so having FX, having international payments, having instant transfer, having pay by card, it just...
Choice matters, and I think, sometimes people kind of forget that it's when you have all the choices that you become the de facto place for businesses to operate, and we have choices. You can use BILL from your phone, from any bank account, to pay any bill, any which way, and that's because we have 12 payment rails and 8 different payment modalities. And so our pitch is, maybe that's a little bit complicated, would be save time, and obviously, be more strategic about your business. And consistently, we see that resonating with customers.
Yeah. I think you've talked about... You and John have talked about sustainable client additions. Is there a silver bullet that can change that growth algorithm in your mind, or is it just all of it coming together, and it's a long wave to get these SMBs up?
Yeah, I mean, our lead director, somebody that you know well, Pete Kight-
Yep
... founder of, of CheckFree and CEO there for all the years that it was, independent, he has said to me many times, "You can never predict tipping points until they're in the rear view mirror." So I'm not gonna try to predict the tipping point, what I can tell you is that the demand is increasing when we talk about the ISV partners.
Yeah.
When you see more competitive entrants, saying: "We like what BILL is doing, so we're gonna try to do that too," that tells you that there's demand and awareness that's growing, and that's good. Like, that's super important because guess what? We're in front. We've been building this 18 years. Nobody else has the scale and the platform that we have. Nobody else has the innovation behind it that we have. Everybody else is trying to catch up, and so when they're trying to see, how do you get a faster horse, we're actually reinventing and building more onto the platform. And so I think it's a super important point for us, that the market is starting to mature, and we're - I'm super excited about every, you know, asset that we have to help us capture as much of that as possible.
Yeah, no, I'm excited to see the ISV and what kind of pull through that comes with that, and we've seen that in the merchant acquiring side. So I'm curious to see how this plays out here. Just to stay with demand environment, I know spend matters a lot, so I have to ask you about that. You've talked about spend neutrality.
Mm-hmm.
How healthy is the SMB today?
I, I would say SMBs, one thing I've learned over the years is that they're just resilient. They're super resilient. They find ways to make things work. This is their life, right? It's their livelihood, it's what their family depends on, it's what their passion is, and they will find a way to do it. Now, we help them be resilient because we give them tools and capabilities to manage their spend in a way that they can't do without us, if you think about just the paper and all that. So the resilience allows them to have what I call the spend neutrality, and what we've seen on the spending patterns across our, our business is that, when in for, you know, lack of a better term, I think a year ago I would have said it was a wait and see economy.
I think I misnamed that. I think now we're in the wait and see economy. I think a year ago it was the wait and fear economy. I think there was a tremendous amount of fear around a pending recession and how strong that was gonna be, and people were just really contracting and constricting their spend across the platform. We saw that start to change for SMBs in the fall. We've seen that change for larger businesses, where now the year-over-year spend is roughly flat.
Yeah.
So the opportunity, I think, is businesses are not investing, and they're not investing for growth. They're kind of managing where they're at, and I think what's necessary is just more clarity around the macro, and the macro is gonna get more clear as, you know, the Fed gets a few more quarters of inflation under its belt, as the political environment... Whatever it is, these things will create more clarity in the coming quarters, and you know, we're positioned to have that be a tailwind, just given the sheer scale of the products that we have across our payment platform.
Sure. I think TPV grew right in line with what you and John were forecasting in the third quarter. I think you expected some muted growth in the fourth. Anything to call out to get there?
No, I think our expectations are that until we see businesses starting to invest, we're gonna see more of what we've already seen. So it's more of the same, which is, you know, you could define that as muted because businesses aren't investing for growth right now. They're just kind of holding in a holding pattern, and we expect that will continue until things change and people start having more clarity around the macro environment.
Okay, fair enough. So I wanna make sure we hit the take rate question. I think you always do a great, great job, René, talking about sort of the outlook. What's the playbook to expand take rate from here?
Yeah, I think when we step back and we look at where we've been, 4+ years ago, 3 bips is what we were getting on the overall spend across the business. Today, it's 30 bips. Now, the 30 bips is because Spend & Expense, the card product is part of that. But overall, Spend & Expense, you know, monetizes well north of 100%, 100 bips, net of rewards and stuff like that. So our ability to kind of drive spend on the platform is gonna be a combination of Spend & Expense, as well as all the other payment products. We are still in the early days of what I would call, you know, adoption on the working capital products, instant transfer, invoice financing, pay by card.
Those are early days in the products. I think we're in the medium days on, you know, international payments as well as virtual card. Lots of opportunity still on all those products, and lots of opportunity for us to bring the capabilities that we have across Spend & Expense inside BILL to execute, you know, different payment transactions across the platform. So, you know, we feel very good that the approach we have to kind of create value for customers through multiple payment products and choice, value for suppliers. We haven't talked as much about that, but we have started talking about that. Roughly a third of the revenue comes from suppliers enabled on the platform and then paying us.
Our ability to kind of continue to focus on them, offer them more services and tools, that's an important part of our growth path going forward, and we're doing that. But when we look at all the sheer number of things we can do to drive that type of adoption, we feel very good about our ability to drive the take rate, you know, over the coming quarters and years to, you know, much higher number than where we're at today.
Yes. Let's talk about the supplier relationship side. I know that's a change, that's a different strategy for BILL. What's left to do there? It seems like it's a different muscle for the company.
It's... what's different about it is probably more the go-to-market, if you will. Meaning that, we've focused on serving direct accountant and partner customers with a product that allows a small business to control spend.
Yep.
And so the go-to-market for suppliers is, well, what do they need? Well, what they need is they want better reconciliation, they want faster payments, they want collaboration with their customer. These are all things that we can give and do give to a certain degree, but we can do more. And so the next steps around kinda developing this and thinking about them as customers is giving them the tools, and we've started this on international payments. We've talked about Canada and the U.K., where suppliers, you know, the 5.8 million suppliers we have across the network, those that are in Canada, U.K., they're able to sign up and choose how they wanna receive any payment. You know, what we find is that not all payments come in the FX, their local currency.
Yeah.
Some payments they keep in dollars 'cause they're gonna make payments back in dollars. So it's very interesting to see how choice matters, and having choice at the supplier is better than at the buyer in this case, because the supplier is the one who has to deal with dollars. The same analogy would be true for kind of the virtual card payments. And when you think about, you know, when we started the network, the first person to receive a payment, they were the first payment they ever got from BILL. And now we have, you know, suppliers on our network that can receive tens of thousands of payments from BILL on a given day.
Now, that means that we have to talk to them, so this is the go-to-market, understand, you know, the, the value proposition that they're willing to pay for, and then, you know, continue to enhance our product experience and customer experience for them. And so it is new for us because we've been focused on this other go-to-market, and now we're starting to do, obviously, to do both, and we've seen some, you know, had some very good learnings and insights from, you know, the early experience of just talking more to suppliers, understanding, you know, how much they really don't want checks, right? Because if, if they were to turn off, the virtual card payment, many of the payments would default back to a check, and they don't want checks.
These are things that we can continue to remind and, you know, from a marketing sales perspective, as well as enhance that ultimate reconciliation they're trying to get.
A year from now, what question should I be asking you to see if you've made progress on this?
I think probably the best question to ask would be from a, you know, retention perspective.
Mm-hmm.
... you know, how is the retention going, and have you shifted the focus for those suppliers to, you know, think of BILL as a partner?
Yep.
It's more of a qualitative part of the question, but, you know, that's the way we think about it.
All right. Just one more question for next year.
Yeah.
Thank you for that. So, I do want to get to Spend & Expense. Let's talk about a big theme in all of fintech, which you're very aware of, is banking the user base-
Mm
... and providing more bank-like services. You mentioned instant transfer, working capital, factoring, whatever phrase you want to use. You said it was early stage, but I would think that you have a data advantage-
Yeah
... in doing that versus some of the other ISVs or marketplaces that are looking to do the same thing. Is that true? Tell us about the data advantage you might have.
Yeah, the data advantage is, is super, super real, and the example, you know, I'll just give on this is I'll go back probably, you know, 15 years, whatever, when we started doing ACH payments. And when you start doing ACH payments, it's an opportunity for fraud in the system, right? And so, you know, at some point early on, we were able to use our network data to see, you know, one node that was potentially fraudulent, how other nodes on the network might be fraudulent. That's unique data. So we now have 5.8 million network members that are connected, and we can understand when payments are happening across any of them, how it affects all of them. And that allows us... That's a fraud perspective, but that can also be turned into a credit perspective.
Mm-hmm.
What are the opportunities that we're willing to advance? Because we can see their payment experience across multiple BILL customers that they might have. What are the, you know, the insights we're able to get because we see that the, this particular client of ours, this customer, normally approves something within, let's say, five days, and this one's taking 15 days. Maybe we don't want to advance on that. That's something nobody else would have that capability to be able to see how this transaction was submitted, how it's going through the process of the firm that's gonna have to pay it eventually, and how the receiver is doing this with other clients. If the receiver, the supplier in the network, is seeing delays across all of their customers, well, that's interesting for us, and now that informs our decision.
Gotcha.
I'm giving you kind of some-
Mm-hmm
... examples of how the data matters, and what we've always done is taken that data to build machine learning, AI capabilities, and now we'll obviously leverage GenAI when it comes to building some of those models. But, you know, more importantly, on the GenAI perspective, we'll leverage that to create a better customer experience when it comes to insights and forecasting. So you think about the insights and forecasting that we just put inside of the platform, there's an opportunity for us to actually look at all the data that's inside of your own company, as well as across all the companies on the BILL platform, across the invoices. Like, what nobody else has had before is the detailed line on an invoice. What people have had before is, "I paid X person Y dollars on Z date.
Right.
That's very simplistic-
Sure
... compared to the invoice information that we have all the way down, and we have that for hundreds of millions of transactions, you know, in a given year, right? Just tons of opportunity for us to drive learning for our platforms across all that. So we sit in the middle of hundreds of millions of transactions, obviously hundreds of billions of dollars, and that intersection gives us a unique purview about how to leverage the data in a way that nobody else can, and that's the scale advantage, right? This is one of the things I'm super, super grateful for and proud of, is that we have a position of scale that nobody else has right now.
Yeah. I mean, I don't want to say it's easy, but it sounds like there's a real opportunity there to make a pretty quick impact with some of these,
Yeah
... working capital Instant Transfer products.
Yeah. Yeah, I mean, nothing in life, anything that is easy in life isn't worth doing, right? I mean, so it has to be hard for you to build sustainable value for your customers, and that's what we've done. That's why I talk about the perseverance and the grit. Like, we've been here, and we're gonna keep being here because of that passion that we have for customers. But there is a huge opportunity to leverage this because nobody's ever had it before.
Yeah. No, it feels that way. Okay, good. So on the Spend & Expense side, the last 5 minutes, we should cover it. I think there's a lot of... There are a lot of players that are going after that space. I know software matters, but the promise of cross-selling Divvy from where you sit seems very, very real relative to someone that's doing it de novo and just trying to sell it from a software perspective. So tell us about that. How do you win versus some of the other alternatives that are out there on the Spend & Expense front?
Well, I think the integration's super important, and it's not just having the core Spend & Expense capabilities inside the core BILL capabilities. It's continuing to extend the capabilities of either offering, right? So when we think about our core BILL capabilities, everything from the international payment to the virtual card, to the instant transfer, to the invoice financing, to have all of that integrated with one risk model and one operations team, to be able to extend that, that's unique. To be able to then integrate that same risk model as to, you know, the credit that we're willing to extend to a Spend & Expense customer-
Yeah.
-that's also unique.
Mm-hmm.
I believe that the breadth is what customers want. Like, I was talking with some customers last week, and we asked a number of them just how many different software packages the finance team was trying to manage, and it was dozens. I mean, one of them got as high as 75. And that's just a lot of different products to manage, and if we can kind of, you know, create that experience that they get their financial operations in one place, we think that's a unique capability, and we're seeing that with customers that are using both. I think last fiscal year, we announced that we had 7,000. We talked to all the 7,000, and we've continued to acquire more, you know, BILL and Divvy customers together. Like, we're seeing the synergies of having it both.
We have a ways to go to continue to derive, you know, more, more of that ease of use to kind of make that happen, but once people are on the platform, they're definitely seeing benefit from it.
So one quick follow-up I have to ask is, so the balance of leading with rewards and incentives to drive usage or to acquire customers versus the ease and simplicity and the integration and the use. I mean, we all use Concur, and it's really hard to do some of the, you know, the inputting. How does that win when you're competing against some of these other players that are trying to lead with rewards and incentives? And you can look to the consumer credit card side for a lot of bad examples of buying business.
Yeah.
How does that balance out?
Yeah, I mean, it's one of the things... I mean, I get asked a lot of times about software versus transaction. You're more transaction revenue versus software.
Yeah.
I always say, like: Hey, we lead with software. That's why we get the right to do all these things. When I think about the Spend & Expense capabilities, the budgeting capabilities, the workflow capabilities, the simplicity that's inside Spend & Expense, that actually drives the transactional volume that we get. So rewards are a part of that, but that's just a part of cards in general. But we all have our favorite card that we use for rewards, and so-
Yeah
... that is a part of that, but we're able to kinda continue to drive value because of the connectivity and the software that creates more value and saves customers time.
Okay, good. Let me rapid-fire a few more, and then we'll let you go. Just back to the beginning of the conversation on the ecosystem. I know the FI channel has gotten a lot of attention, but it's only 2% of revenue today, René. Where do you think that that can go? Is there anything that catalyzed growth, or it sounds like ISV can carry the load for a little while?
I would say that, when you think about the, kinda the multipronged approach, direct accountant partnerships, and then the network, the partnerships and the network, this is all optionality around driving growth in the future, right? So the reason banks are 2% is that banks have not yet made a full commitment that this is gonna be a solution they want to support, and it's not clear, with, you know, kind of the consumer base history that they have, that it's gonna work for them unless they have a tool like what BILL has.
Yeah.
So what we would say and, you know, when asked, you know, so that optionality is why we do partnerships, and we're in a position with software companies, with lots of different types of players to continue to drive adoption, should customers go there. And we believe there's gonna be a more and more competitive environment at, on different fronts, not necessarily so much as ours, but different players, you know, trying to go after these 75 software packages, and we can be a part of that and enable our customers' journey that way. So we're very bullish on it. Not something that we would see this year or next year, but it's more the opportunity that we see in the future.
Okay, good. We have less than a minute left. I know... Just to close it out, I know the stock's been on a rollercoaster, and everyone sometimes gets too focused on some of the short-term stuff and the macro stuff, but you're about to close out the fiscal year, and you're gonna be able to look ahead. What are you excited about? What would you encourage us to focus on for BILL?
I'm super excited about, you know, just the scale, the breadth of the opportunity that we have, the way the teams are working inside, the fact that, you know, even with all the noise in the last year, we've been able to, you know, each quarter, beat what we said we were gonna do. I think that kinda gives me confidence that the teams really, you know, understand where we're going, and what I get excited about is more qualitative. Just seeing how well the teams are working together and how much we're getting pulled into market conversations tells me that the market's maturing, and that's great because we wanna serve more customers, and that's the way to get it done.
Good. Thank you.
Yeah.
I respect the work you do, so thank you, René, for being here.
Okay, thank you, Tien-Tsin.