Well, hello everyone. Welcome to the Q1 2022 Earnings Call for Expensify. I am David Barrett, founder and CEO of Expensify. We have Ryan, our CFO; Anu, our COO; and Trent here from Technical Accounting. We are here to answer whatever other questions that you have. Let's get started. Just a second. Let's try this again. First we're gonna start off with some fascinating disclaimers read by our friend here, Anu.
Before we begin, please note that all the information presented on today's call is unaudited, and during the course of this call, management may make forward-looking statements within the meaning of the federal securities laws. These statements are based on management's current expectations and beliefs, and involve risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements. Forward-looking statements in the earnings release that we issued today, along with the comments on this call, are made only as of today and will not be updated as actual events unfold. Please refer to today's press release and our filings with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today.
Please also note that on today's call, management will refer to certain non-GAAP financial measures. While we believe these non-GAAP financial measures provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Please refer to today's press release or the investor presentation for a reconciliation of these non-GAAP financial measures to the most comparable GAAP measures. With all that, hand it back to you, David.
Great. All right, we are coming to you live from the Bank of Expensify here in Portland, our lovely office up here, in the great north. First we're gonna start off just talking about, you know, a reminder of why we're all here. Basically, what is the heart to Expensify's sort of secret for success? It rests on three major pillars. The first is that we believe the market size is enormous. The opportunity is huge. We think that basically of all the companies in the world, virtually none of them do anything yet. Almost every company in the world is still struggling with expense management, and we think that all of them are going to switch to some platform, and we're gunning for it.
We think there's a huge opportunity, and we have a business model that can acquire it all. This business model is unique to Expensify. All of our competition has the same classic top-down enterprise sales model, and shocker, it only really works in the enterprise. The vast majority of the opportunity is outside of that, and is inaccessible to the traditional business models. We think that we have a unique opportunity to capture the overwhelming majority of the market. Third, we think this market is huge. We think that we can link a billion people together on a common platform. If Instagram can link a billion people through photos, we think we can do the same through money. To kinda dig into that a bit more, the market is enormous, and it's not just the enterprise.
We think that we can go into the overwhelming opportunity size of the SMB. The SMB is by far the biggest and best part of the market, the highest margin part of the market. Yes, we can go anywhere. We have enterprise customers, we have all sorts of customers. But we think the greatest part of the opportunity is the SMB, where we are uniquely optimized and focused on. Our model basically involves brand advertising and freemium acquisition to create really efficient lead generation, and then we have a super efficient high velocity sales model. Involves, you know, inside sales team, partners, and of course our just automatic self-service subscriptions. We think that all of this is what leads to our super profitable growth over time.
As a reminder, our business model works by individual employees signing up for Expensify in the company before being asked or asking permission. Just basically signing up and giving it a shot. This turns every expense report into a highly targeted marketing message directly to the decision-maker. This is a way that we can generate leads into companies of all sizes, basically without having to pay for them, and thus being able to close them, turning every employee of other companies into a salesperson for Expensify. Come on clicker, you can do it. There we go. Expensify's model, we're the only ones who can reach the full market. We're the only ones who can make five super important claims. First, we have true enterprise scale.
We can go up to the very top of the market, support the large multinational public companies like ourselves. We also have a consumer-grade design. We can meet the bottom of the market and support basically the small SMBs and individuals as they're just entering into the entrepreneurial space, the side hustle phase, things like this. We have global reach. We support all currencies. We support all sort of corporate card feeds. We have not just a native corporate card, our Expensify Card, but also native corporate travel as well, built into our Concierge. Finally, all of this is free. We're the only company that can make these five claims, and we think this is very unique to Expensify, and this is a key part of why we think we can capture the whole market.
We think there's a huge opportunity out there about uniting all these previously disparate financial use cases into a single flow. Everything from unstructured chat to P2P wallet functionality like Venmo, corporate travel, invoicing and bill processing, corporate card, payroll, expense. We think we can link all of this onto a common platform because they're all the same variations upon the same common theme. It's a list of expenses that you give to someone and you pay in return, and we're taking it all. Maybe just to kind of as a quick refresher for everyone who doesn't already know the most of you do, and just to kind of touch on a couple different business updates.
First, we launched our CPA Card. CPA Card is the very first corporate card built exclusively for accountants and their clients. This card has a number of perks designed specifically for accountants like reimbursing AICPA memberships, CPE credits, and things like this. It also has dedicated and special pricing for accountants to manage their firms. This is the first in the industry. We're taking this out through our extensive partner network, out to all the accounting firms in the world, and we're super excited about the traction so far. Second, let's talk about the free plan. The free plan isn't new, but we're gonna talk about some exciting sort of growth we've had in it. The free plan, we would like to say is the freest of free plans around.
It has more free functionality than anything else in the market. It has all sorts of administrative features to manage not just your expense reporting and not just reimbursements, but also has a corporate card. You can send invoices, you can pay bills, so you can collect revenue and sort of support everything. You do corporate travel. It has everything built into a single platform that is completely free. The Expensify free plan is designed for companies, again, small businesses in the start of their journey, when they're brand new and just getting started, but is a complete platform for everything. We like to say at this that our free customers pay us in a few different ways.
First, if you use the Expensify Card, you're generating interchange for us, and so basically every use of the Expensify Card is making us interchange. Even though it's free for the customer, it makes us cash. Second, they're paying us in viral lead gen. Every time you send an invoice, you're sending it to the accounts payable group of a different company. Invoicing and bill processing allows us to leapfrog between the accounting departments in different companies. Basically just to use the free plan, you can't help but promote us to everyone around you. Third, of course, is you use us, you pay us in word of mouth and branding. To use Expensify, it's because it touches such a potent pain point, you just can't help but talk about it.
We would much rather that you're using Expensify for free than continuing to use Excel or use a competitor. Of course, you know, you don't stay free forever. Eventually, if your company is successful, you keep hiring, you're growing, your complexity hits a certain point where you cross one of our paywalls, then you become a fully paid subscription. The free plan is an incredible plan that we're super excited about. With that, I think I will turn it over to Ryan.
All right. Hello, everyone. I'm excited to talk to you about our Q1 performance. Q1's kind of interesting in that it was the height of the pandemic, so more people got COVID in Q1, which, you know, provides a kind of an interesting condition for a banner business month. Actually, March was our second-best month in company history, and I'm gonna kinda break down on what that means. First, let's talk about the actual results. Our range was $38.6 million-$39.6 million in revenue. We came in at $40.4 million, so above expectations. Then the paid members, we were expecting 684-702. We actually came in over that as well at 706.
Things are going great, and we're excited about the performance we're seeing in the growth of the business. Now, I mentioned the impact of Omicron, so we got a lot of questions about this last time, so I wanted to just explain how the quarter kind of shook out. In December, we have a great end of the year. In January, Omicron peaks. Like I said, more people infected in January than any other time in the pandemic. What happened with Omicron is that a bunch of people got infected, but they got over it very quickly. It didn't last as long as kind of the other spikes, and we see that in our numbers.
In March, we actually, if you were to cut out January and February and just took March from December, it's actually consistent up and to the right. However, we did have that Omicron impact at the first half of the quarter, which, you know, makes it tough, but we had a huge rebound in March. Going forward, we feel great. Things are moving perfectly. Obviously, Omicron is a bump in the road. We continue to demonstrate strong long-term growth, so again, 706,000 paid members, $40.4 million in revenue. Our year-on-year revenue growth is 36%, and on an annualized basis, that's $161.6 million in revenue. I also wanna talk about kind of the profitability of the business. We generate significant cash and profit. Our operating cash flow was $11.2 million.
On a GAAP net loss basis, we had -$7.4 million. That is driven primarily by the stock-based comp expense. If you back out stock-based comp, our non-GAAP net income was $7.3 million, and Adjusted EBITDA was $11 million. There we go. Oh. Geez. Clickers. Okay. Sorry. It's a live fire demo.
Yeah.
David talked about the free plan. I wanted to actually just share some numbers. We had over 9,000 new customers sign up for the free plan. That's a 183% quarter-over-quarter increase in free plan members, so the free plan is extremely popular. As David kind of went through how these customers pay us, either through word of mouth, through actual interchange, or actually upgrading to a paid plan, we see this as a very exciting sign for things to come. This plan has not been out very long, and it's going great. We wanted to really just highlight some exciting, you know, signs of future growth, and we think that this is one of them.
We also reaffirm our long-term growth guidance, not only this year, but we think that we can maintain 25%-35% growth over the multiple years going forward. We just wanted to remind everyone of that. With that, we'll start our Q&A. Anu's going to-
I'd come in here, but I wasn't ready.
Call on people.
Cool. First we have Brent from Piper Sandler.
Thank you for taking the question here, and great to see the business snap back from a paid perspective post the little Omicron air pocket. I guess first question is really on just this general return to business travel that you're clearly seeing in March. Looks like that return to business travel continued into April and May. Maybe walk us through the lag or the timing of when you start to see a return to travel start to show up, either in active paid member users or in kinda TPV volume. Just trying to understand how we should connect the dots there as we see external business travel pick up and how that impacts your business.
Yeah. More people traveling is obviously great for us, not only because they're more active on the platform, but actually we see more signups in times when people are growing. The reason for that is we solve a very real pain point, and that's when it's expense reports. People complain more about expense reports when they're traveling, so if we see more people traveling, not only are they more active on our platform, other people who are not using Expensify are complaining about expense management. Because we have such a strong brand in that space, they're more likely to get a recommendation for Expensify when we have more people actively complaining about travel, which we didn't have in obviously during the COVID periods. Now you asked about the lag time. We bill in arrears, so basically like a 30-day lag.
If we see a huge uptick, let's say in April, there's a bunch of reports that, you know, travel doubled or something. That'd be wild, but if that were to happen, that would show up the next month in terms of when we would see that.
Helpful, color there. Just to be clear on the delta between the reported 706,000 paid members versus the 742,000 in your slide, the delta there is just the average we should think about when you report the quarterly paid members.
Oh, yes.
706 is the average over the full quarter, and then the 742,000 was just a snapshot. Is that the right way to think about it?
That is a great question, Brent. The paid user number that we report every quarter is the average of three months. Normally we don't break out months, and we won't do this going forward, but we felt like this is a very important piece of data that we need to show. The average doesn't tell the whole story, right? We had actually the second-best month in company history from paid member perspective in March, but that isn't shown up in the average. Just so you know, the first best month in company history was the month prior to the pandemic. This is the second-best one. We think that's actually really exciting, but we will not be showing monthly data going forward.
It's just usually an average, but this was important for the visual picture.
Yeah, listen, we won't complain. If you choose to disclose more. Okay, my last question, kind of a follow-up here on the free plan. It sounds like really good momentum this quarter. Can you describe the type of customers that you landed? It looked like about close to 5,000 net new folks going on the free plan. Are these small entrepreneurs that are just now starting out-
Possibly
that are onboarding, or is it a wide range? Just trying to understand.
Sure
what that customer profile looks like for my own TPV assumptions.
Yeah, that's a great question. I think if we kinda go back to our, you know, island of markets, this is showing the beachhead.
Sure.
It's basically these are like, again, sole proprietor, a side hustle, a brand-new SMBs, people just entering the market. We view it like very much top of funnel for us. We were trying to capture everyone at the very earliest point of their journey with a free product, because once we're in, then we stay in forever, so long as we just don't screw it up, basically. 'Cause it's like if we're already there, and they need an invoicing solution, it's like, well, I can just use the one I already have. Also, like, I need to start. Finally I have some bills, I should probably start using this bills, and things like this.
We just wanna have pole position for every new financial use case they have by getting to the drawing board at the earliest point, and then we can hold on to them as they go through their journey. If they go up to the snowy tundra to the north, it's like, well, we can follow them the entire way.
Got it. Very helpful color there. I'll cede the floor, but great to see the recovery in the business. Thanks.
Thank you.
One piece to add to that, the free plan metrics. It's definitely concentrated more towards really small customers, so one to five employee companies. There's actually an immaterial number of slightly larger companies in there as well, like the 10 to 20 range, and that's interesting because sometimes a company comes in, onboards on the free plan, uses it in a very low-control, simple use case, tests it out, we don't know yet how long, but like, for some period of time, and then decide to upgrade. There's actually, while still an edge case, a healthy pipeline as well.
Sure.
That's exciting, and we look forward to talking more about conversion in the coming quarters.
Cool.
Cool. Next question, let's go to Koji at Bank of America.
Hey, guys, can you hear me okay?
Yeah.
Great. Hi, Koji.
Oh, hey. Oh, great. Thank you so much. Bouncing in a couple different calls here, so apologies. It sounds like you gave some good information on the subscriber side, so thank you for that. Just wanted to ask you a question on, you know, you reported the fourth quarter essentially at the end of Q1, you know, on March 30th. You did beat by the subs or by the subs and the revs, and it sounded like you beat the revs in the March quarter by a lot. Just curious, you know, was that just conservatism, you know, when you were coming out on the fourth quarter call guided to this quarter? Or was there something else going on that just kinda surprised you know, right at the end of the quarter?
The guidance that we gave was based on how we saw the quarter coming out. I mean, March was a really big month, right? It was the second-largest. Every single week, you know, the numbers were going, you know, up and up. We gave the best guidance that we thought, you know, at the time, and it came in, you know, a little bit above that.
Got it.
It's not really conservatism for the sake of it. Like, one thing to consider is we know at the point that we did the call, we know what we know about activity. From an accounting perspective, we haven't yet booked the revenue. We also wanna make sure that we take into consideration that there might be accounting related, you know, treatments that might differ based on the actual results. That's why we do a range.
Got it. Got it. Just one follow-up from me. Yeah, apologies again if you mentioned this on the call, Ryan, in your commentary. Just any sort of, you know, change in the way you're thinking about sales and marketing spend for the rest of the year. You know, especially given that you did have such a record quarter, record month in new sub adds. I mean, are you thinking about sales and marketing the same as you did, you know, kind of a couple months ago? Or are you deciding to maybe step on the gas a little bit? You know, any sort of help there in the way we should be thinking about your sales spend or marketing spend?
We're not currently planning on increasing it. We're still measuring the effectiveness in all these markets. 'Cause remember, we kind of exploded on, onto all these in the top 20 largest markets in the U.S. We mentioned last quarter that we are layering in more of a sales function than we've had historically. I would expect relatively the same amount of S&M, you know, as you were thinking before. We're actually gonna be probably adding in more sales but less marketing and, you know, experimenting with that.
Got it. Thanks for taking my question, guys. Appreciate it.
Of course. Good to see you.
Next we go to Tyler from Citi.
Hey there.
Hey, Tyler.
Hey, thanks for taking the question. I wanted to see if you could just comment.
Oh.
I think we just lost Tyler.
Oh.
Oh, you're back.
Okay. That was weird.
One more time.
Okay. Can you just talk about, you know, clearly really nice improvement throughout the month of March to that, you know, 740-
Oh, no.
I don't know why it keeps going out.
We're gonna-
That paid member. Can you talk about how that's trended through April and May? Has that improvement continued?
Just to make sure, are you saying, are you asking for insight into how paid members are looking in Q2? Is that what you're asking?
How is the paid member growth throughout Q2 since the end of March?
It's doing great. Obviously we're not seeing a drop like we saw in Q1. I think that growth has remained consistent. Obviously we're not going to give guidance here, but it's going, you know, it's going great.
Okay. I'm curious, like with that drop. Sorry.
With the drop?
With the drop in paid members, how much of an impact did that have on interchange revenue, and would you expect that growth to accelerate, now that you have this free program and obviously we're kinda through Omicron?
Yeah. That's a really great question. Let's say we were to layer on the interchange onto this chart. It went down with Omicron, but the quarter-over-quarter increase in interchange was 15%, and that's despite the Omicron drop. Obviously that did negatively impact that. There was a bigger growth in interchange than there was in revenue quarter-over-quarter, despite that. We do believe or know that Omicron impacted the growth of the interchange. Does that answer your question?
I guess like just given that what you're seeing in the free momentum, which should help the interchange business as well now that we're post-Omicron, like do we should we think about year-over-year growth accelerating kinda going forward of that interchange revenue because this was kind of such an impacted quarter?
I think one month is too. Like, the one month impact is very pronounced in the quarterly results. When you look annually at a program like the card, which is still kind of in its evolutionary stage 'cause we launched it like two years ago and it really started to take off only post-pandemic, I don't think it's a blimp in the annual journey, so I don't think it should really. It's not gonna be material to the results when you look at it year-over-year.
I mean, the way we see people modeling it, I think is probably pretty accurate.
It's inaccurate.
Yeah.
Mm-hmm. Okay. Great. Thanks for taking my question.
Well, maybe.
Yeah.
Well, maybe let's talk about this in Q2.
Sounds good.
'Cause it's a weird quarter, right? We'll
Yeah
See how in Q2 we can talk about that.
All right. Thanks.
No problem. Thank you.
Next we go to Pat at JMP Securities. Do we have Pat? Okay, we'll circle back to him maybe later. Mark from Loop Capital. Do you have a connection issue or something? Let's try Daniel at BMO.
Hey, can you hear me?
Yes.
Yes.
Okay. It won't let me start my video, so I apologize. I'd love to see you in person. On the buyback program, right, that was announced today as well, it wasn't mentioned, but I'd love to kinda compare and contrast your commentary about how impressive the market opportunity is and how it's a race to capture it, and sort of the choice to do a buyback program instead of investing that for growth.
Okay. Great question. I think that if you're talking about, like, a billion user opportunity, that's not an opportunity that you capture through advertisements. The way that we grow in the long run, like the bulk of... Harry, welcome. The bulk of our, you know, between now and the next billion users, is not gonna be acquired by someone, like, clicking on an ad or talking to a salesperson, it's gonna come because we've cracked a viral code. All of our, you know, the primary driver in the long run of long-term growth is going to be, product and viral. I think that, it's tempting to see, like, basically, you know, this direct correlation between spending on customer acquisition and growth, but I think that,
We have definitely been very aggressive when it comes to spending on advertising customer acquisition, but you shouldn't misattribute our current growth exclusively to our increased advertising. I think the bulk of that growth is a consequence of just a better product, the good, better market conditions, and our ability to capture these sort of viral loops. Which is just a long way to say, I think that there is a point of diminishing returns to advertising. Like, right now we buy every single keyword relevant to expense management and things. Like, we're in every one, every single one. You, like you can't 10x the amount of qualified inventory available, even if our money does 10x. And so, like, we're in a ridiculous number of cities. Like, I see our billboards in Portland, like, 10 x a day.
It's like, okay, I could do 20x or 100 x a day, but like, at some point it's like, okay, this is pretty saturated. I think that, like, we're already one of the top advertisers in, like, outdoor advertisers in the nation. I think that, advertising's great, and customer acquisition's wonderful, but we just have a business that kicks off so much cash, that at some point, spending on another billboard or another ad isn't the best use of funds. Now I think that also is like, it's just a crazy market conditions, and so this is not an obligation to do anything, but it is an opportunity.
Basically we're saying it's like, "Hey, we're authorized." If the conditions warrant it, and we think at the moment this is the right thing to do, then we can act quickly, but it's not an obligation to do so. Any thoughts, additional thoughts on that?
Yeah, I think so. We have had a lot of discipline growing sustainably over the last decade, and we've managed to grow, you know, at a great pace and also add cash in the bank. The buyback would never any shares that are repurchased would not be at the expense of sales and marketing.
Definitely not.
or growth or anything like that. It's if you have excess cash and you're just collecting interest on it, you know, let's buy back some shares versus just having it sitting on a bigger and bigger pile of cash over time. That's kind of the thought process behind the authorization of that. It's not instead of growth, it's what do we do with the cash in excess of all the money we're spending on growth. Great. I appreciate the context. It hasn't been asked yet, so I'll ask it. Any update on the Marqeta contract? Thanks. Actually some pretty good progress. Do you wanna-
Yeah, I mean, we're still working through it, so it's sort of more of the same, but we're making steady progress. We still think we can get it done this year. We are working right now to make sure we are locked and loaded on the accounting treatment, which is, like, the primary goal of doing it. We're trying to get it all right.
Great progress, and we're more confident than, even more confident this quarter than we were last quarter.
Gotcha. Maybe I can just sneak one more in then. How's the penetration of the card into the non-free base? How is that trending relative to your expectations? Thanks.
That's a great question. We have done a great job of getting customers signed up on the card. I believe around the time of IPO, we were like at a 4.5%, or it was 5%, something like that. Go back and check the S-1, so something like that. Now we're looking at more at about a 9% attach rate. That's customers signed up. Now, that doesn't mean a 9% fully penetrated across those customers. Our job now is to get all the employees using the card at all these customers. I'm very, very happy with our ability to get customers signed up.
Yeah.
Our job now is to just make sure that they fully deploy it across the company, 'cause that is kind of a habit change, so.
Yeah.
I don't know if you guys saw this, but maybe a month, less than a month ago, we launched monthly settlement.
Great.
We have some early results, although we're not talking about exact numbers. The early results have actually been super promising. It was one of the most requested enhancements to the card, which we've gotten out, so we are very optimistic that it'll give us a little bit of a boost to an already high momentum program.
Let me explain a little bit what that means. The Expensify Card to date has been a daily settlement program, which is really great for sort of high spend companies. Basically it's optimized for companies that need to turn over their credit very, very quickly. If you've got like, you know, a $100,000 limit or something like this, or a $10,000 limit, you can do every single day $10,000. You can spend a lot of money very quickly. Especially as we go into other companies that are more cash constrained, who actually wanna sort of finance the business, they're not turning over their credits quickly, they actually wanna extend that over for a longer period of time.
I think we're the only program that supports basically both a monthly and daily settlement option. Monthly is really great for high spend companies. Daily is really great for high spend companies. Monthly is really great for sort of a cash constrained company trying to finance their, you know, their operations, and we support both ends of that. I think that we've found that actually the cash constrained spectrum is the more attractive for the accounting community, and that's why we launched it in parallel with our CPA card because this is something that we found that CPAs are no longer just trying to identify problems, but also solve problems for the clients.
They say, "Hey, you are very constrained when it comes to your credit facilities." Now they can work through us to be extending essentially credit to their clients through the Expensify CPA Card. I think that it's a new thing, but we're very, very excited about it. When we know our accounting partners are super-duper excited about it.
Great. Thank you very much, everyone.
Thank you.
Let's try Mark from Loop Capital one more time.
Do we have anyone left?
Hi, can you hear me okay?
Yeah, there we go.
Yes.
Hi, yeah, thanks for taking my question. David, a question for you. On the last quarter's call, you mentioned that you were adding some outbound capabilities to your go-to-market motion.
Sure.
You know, basically where you go out and call prospective customers. As I realize it's still early days for that initiative, but I was wondering if you could just give us an update on how those
Yeah, yeah.
Outbound efforts are going.
Yeah. I mean, I'd say it's still early days. I think that basically our philosophy overall is we wanna expand this sort of inside sales team such that we can turn around calls within 30 seconds. Basically when anyone wants to call 24/7, that there's someone there who is able to pick up the phone, talk to them, and give them a demo, like, you know, within 30 seconds of the request. That's sort of the main focus right now is nailing that down. Our approach towards outbound is because the way that you ensure that you can do that is you just have an excess of people sitting around at all times, and then outbound is basically how you fill in the gaps between that. We are putting enormous amount of effort into this.
We've substantially sized up that team, and I think we're super excited about that progress. Still early days in terms of from a results perspective, but it's definitely, something we're, you know, excited about and working on.
Okay, great. Thank you. Question on the hiring front. You know, many software companies and tech companies out there are having a difficult time hiring good IT talent. I was just wondering if you could just give us an update and discuss how the company's managing through you know, some of the hiring challenges.
You know, that's interesting. That's something we talk about a lot internally. I think that, you know, Expensify is weird in a number of ways, one of which is our approach towards just building a team. I think for a lot of companies, hiring is, you know, it's like a vanity metric. It's like basketball. People are like, "Oh, yeah, we did hire. We hired 500 people this quarter," or something like that, and then brag about it, like this is a sign of success. We view hiring a bit like golf, as like we're gonna hire the fewest people necessary to solve the problems that we have. Even better than hiring is, one, don't have problems. Two, automate away the solutions of those problems.
Three, find some outsource provider that can actually solve that problem and in a super cost-effective and scalable way. Only fourth, basically, if we can't solve the problem in any other way, should we be expanding sort of the core team. Our core team is really just kind of the creative collaborative hub of the company. Expansion of the core team does not correlate directly with sort of revenue growth. Like, we can, and we've already shown this, we can double, 10x revenue with the current team. We hire not to just, like, keep the business running. We hire in order to pursue more opportunities. There's kind of like not a direct relationship between those two.
Hiring is basically necessary to sustain very long-term growth, but it doesn't actually have really any impact on the short term. That's all just a long preamble to say, we're not hiring the same kinds of people that a lot of other companies are. Like, a lot of companies are like, "Man, it's really hard to find 500 qualified engineers." It's like, "Yeah, I'm sure it is. That's pretty tough." We're not looking for 500 qualified. We're like, we're pretty much hiring one absolutely amazing person a month, and like, more or less. For us, that's a good rate because we like to really invest in our existing team so much to get the maximum value to everyone.
I think that we hire slowly, but that's by design. We've never struggled to hire. In fact, we actually have been increasing our hiring standards across the board because we're finding it easier and easier to hire. But we're looking to hire at a very controlled rate and only the absolute best of the best, and I feel like we do very well at that.
To add to that, we did agree with all of that, but we also did hire two very seasoned individuals into our accounting team.
Sure. Fine
which we're very excited about. That is, I guess, an example of a strategic hire, like an area that we're beefing up, that we are paying closer attention to, and looking forward to getting a lot of those processes well ironed out.
Yeah.
Expensify is a great place to work, so we don't really have the, maybe the same challenges that other people have.
That's a fair point. We don't have the turnover problems either. It's not like we're replacing.
Yeah.
It's like most companies, it's basically like, you know, the average is you've been there for, like, two years or something like this. It's like, look to your left, look to your right. One of those people started in six months ago, the other one's gonna leave in six months. It's like most companies are just frantically treading water, whereas we just hold on to people kinda forever, and so we just don't have to have that steady replacement.
Yeah. If you have to turn over, on average, your entire employee base every couple of years, that does make it very hard to hire.
Yeah.
We retain everyone for basically forever, so we don't struggle with that as much.
Yeah.
Um-
All right. Great. Thank you.
One last question from Pat, who's, I think having technical difficulties being heard. His question is, what are one or two most important things on David's to-do list for this year?
Oh man.
That's a great question.
Pat, you're killing me here.
Remotely challenged.
Most important thing is a good team. I mean, a lot of it is just the table stakes of being a public company. Like, we're a new public company, and like we talked about, we're beefing up our accounting, we're going through SOX compliance. There's just a lot of, you know, work to just make sure that we can continue to earn the position that we have. Like, this conversation we're having right now is an exciting conversation for us, but it's also kind of a new conversation. We're kind of beefing up our muscle memory for how to do this. I'd say first is just, and it's pretty boring, but just organizational excellence. Just, like, what is all the important stuff we need to do? Write it down. Get everyone trained on it.
Getting everyone doing it reliably. It's not the sexiest thing, but it's something that I care a lot about, and so I know I'm putting a lot of personal attention to it. That's one. Second, I would say is finishing reunification. I'd say, like, on our product roadmap, we're doing a tremendous amount of investments into this new vision of what the industry can do, and it's a new thing. It takes a lot of work. We have a huge fraction of our team working on a daily basis to imagine this basically new chat-centric, sort of chat first, mobile first way to not just do expense management, but to do all corporate finance on a single platform. No one's ever done that before. No one's even tried.
Most people don't even think it's possible. We do. We've put a lot of thought into that. I'd say I balance my time between, on one hand, just holding the organization's feet to the fire for, like, an incredible efficiency and just excellence across the board in the exciting things and in the boring things. On the other hand, participating in these very robust discussions we have about how are we going to disrupt and revolutionize this industry forever. That's exciting. Both of those are very important.
Cool. I think we're ready to wrap it up.
Great. Well, as always, you know, it was a pleasure. To summarize kind of Q1, we remained cash flow positive and profitable despite peak COVID, which is a pretty exciting thing. Revenue's up 36%, Expensify cards 150%, free plans up 183% from last quarter alone. This is an exciting time for the business. I mean, this is the most obvious thing in the world, real excited that COVID looks like maybe it's behind us kind of-ish.
Yeah.
The more that's true, the more things are gonna be awesome and 'cause we're built for, you know, good times and bad, but obviously.
Obviously
We like, you know, the good times better. I think that's it. Thank you so much, and we'll see you here next quarter.
Godspeed.
Bye. Thank you.
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