Hello, everyone. Welcome to the Q4 and fiscal year 2022 Expensify earnings call. Our CEO, David Barrett, couldn't be here today. He had a personal emergency come up last minute. The show must go on. I'm Ryan Schaffer, Chief Financial Officer for Expensify. We also have our Chief Operating Officer, Anu, on the line, who's gonna be taking you through the call today. Without further ado, we're gonna hand it over to Anu, who's gonna take us through the legal disclosures.
Good afternoon, everyone. Disclaimer, before we begin, please note that all of 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 in our files 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 their most comparable GAAP measures. Whoof. With that out of the way, next slide. I'm very happy to be here to remind you guys about Expensify's long-term strategy and why you should believe in this company. Next slide. There are three secrets to our long-term success, and you've heard all this before, but, you know, it bears mention again. The first is the market is enormous and largely untapped.
Far more small businesses and far more employees that work at small businesses out there than there are enterprise companies, and most of them do not use any kind of product today for expense management, so it's largely greenfield. Second is we have a very unique bottom-up acquisition model. Why that's interesting or bears mention is because this unique bottom-up acquisition model is really primed to take this enormous, untapped, largely small and medium business market opportunity. We talk about that really briefly further down as well. Last but not the least, there is no dearth of ambition at Expensify. We have our sights set on a billion-user platform opportunity, and we are here for the long haul, and we hope you'll come with us. Next slide. Really briefly, why is the market opportunity so huge?
You've seen this over and over again, but again, just reminding you that there are far more small businesses and employees that work at small businesses all over the world. If you add them all up together, by measures of, by a huge measure, outpace enterprise companies and their employees. It's just that the market is huge in the small and medium business space. It's also that it's largely greenfield. They're not using any kind of tool today. They're using Excel and manual processes. What you really just need to do is convince them that using Expensify is a better use of their time and resources. The challenge is most of the market, all of our competition is, operating with a top-down sales-driven acquisition model.
What this means is, if they try to go to market and pick off one small business after another in order to acquire them, they can't do it scalably, they can't do it profitably. It just doesn't work. Next slide. This is where our acquisition model comes in. We have a bottom-up acquisition model, and why is that interesting? We market a very consumer-grade product to end users who are employees. These employees have a very real pain point that none of the other competitor applications out there are targeting or trying to solve. What this means is we make the employee's life better for free, and they can adopt us without asking their company for permission. This motivates them to talk about us to their colleagues.
It motivates them to talk about us to their managers and sell us up into their company, and that's how we grow. We grow bottom up. We have this very scalable, very profitable business model that can use word of mouth and viral lead gen to pick off small business after small business in a manner that we can acquire this large untapped market opportunity over time. Next slide. To recap, we are one of the few free applications out there that is consumer grade and can be sold to employees who can adopt us without asking their companies for permission.
Once we are sold up into the company, as that company grows, we have enterprise scale, and we have global reach, so we can continue to scale with that growing company, and they never need to leave us, and we can retain them forever. You know, combined, the fact that we're free consumer grade, but we have enterprise reach and global scale is why you should believe in us. Next slide. You've seen this slide many times as well, but I just want to remind you that this is our roadmap. Largely, the only thing that's changed here over time, like since we went public, is the fact that more and more of these features have gone from gray, which means it's in development, to green, which means it's in beta, to blue, which means it's launched.
The way to read this slide is go left to right, and everything that is on the far left are consumer grade by lead gen features, and helps us sort of continue to grow user base as on the free product. Then as you go right, you see more and more enterprise grade features. Taken together, this allows us to hit the market really hard, acquire them profitably, and then keep on growing with them such that we can build on our transactional and subscription revenue with companies as they keep growing as well. That's a recap on business strategy and why we are who we are and why our business is built for the long haul. With that said, I'm gonna hand it back to Ryan.
Great. Thank you, Anu. Let's talk about some 2022 highlights. We had strong growth despite some tough headwinds. Expensify remains resolute despite the economy. As everyone knows, if you're watching the headlines, a lot of companies are laying off employees. Some companies are pivoting. They're changing their business model, their go-to-market. At Expensify, we are a steadfast in a, you know, an economic storm. We're hiring. We've been hiring the entire time since pandemic. We're continuing to hire. We're generating a lot of excess cash. We have $1.2 million in revenue per employee, which is quite high. We're also just focused on the future. We're still executing the same plan. We're not changing. If the, you know, economy gets shaky, we don't need to pivot into something completely different.
We just keep moving forward. As you know, we've been buying back shares as well. Some of the things that we did in 2022 that we wanna talk about is that we spent a lot of energy supercharging the accounting channel. People always ask, "Okay, why accountants? Why accounting firms? Why SMB accounting firms?" One thing that's important to note is even a small accounting firm is an enterprise-sized opportunity. Each firm has dozens of accountants. Each accountant has dozens of SMB clients. Each of the SMB clients has, you know, multiple employees, in some cases, you know, a lot of employees.
When you add up all the employees managed by, or in all the customers of accounting firm managed by all the accountants, even a small firm can be a very large revenue opportunity for us. Some things we did to help supercharge the accounting channel is we announced the Expensify CPA Card with accountant-specific perks. We have assigned partner managers to the 500 largest partner firms, which is over half of all of our partner revenue, which is now overseen by a partner manager. We've announced ExpensiCon 3, where we're bringing together 100 of the top minds in accounting. You may have seen our announcement that we're gonna have a headline speaker, George Clooney. We're very excited about that.
The previous two ExpensiCons are very successful for us, and we're excited for ExpensiCon 3, and to meet Mr. Clooney. Let's talk about how we supercharge our sales efforts. We have scaled our account managers, so that nearly all revenue is now overseen by an account manager. We've added onboarding phone support, so all customers that want to talk to someone through the onboarding process can get a response within two minutes or less and be on the phone with them very quickly. Previously, most customers did self-service, and if you wanted to call, you kinda had to be a larger customer. At this point, anyone that wants to get on the phone can get on the phone, and they can get on the phone quickly, which has been a great development for us.
We've also created an outbound SDR program. This is something that didn't exist at all, now we've built that, so it's a kind of a zero to one type of function, and we're working with multiple vendors built to scale that SDR program efficiently. This might be new to some people, but we're also supercharging what we call our contributor community. we talk a lot about Expensify Chat, and it's this new platform we're building, and we're building it on a programming language called React Native. we made the very exciting decision to open source that, which means external engineers can work on Expensify Chat. what we've done is something very unique, is that we are paying these open source contributors. Normally in open source, it's just volunteer work.
It's transformed how we work. Our internal engineers, which are incredible people, they will design a feature, break it out into little pieces. They post those pieces into Upwork, very quickly, within minutes, we'll have, you know, five, 10 proposals. Our engineers then project manage all these contributors working together, and they're able to ship features much more quickly, much more efficiently. We think it's pretty unique. It's not really done by many people, certainly not in a paid manner like we're doing. This is, we think, over the long term, gonna be a very competitive advantage for us.
We currently have hundreds of React Native engineers using our or active in our contributor community. In 2022, we paid out over $1 million to those engineers. If you're a React Native engineer listening to this, we'd love to work with you. Check it out. All right. Now let's get to 2022 and Q4 financial performance. We had a great year. In 2022, we did $169.5 million in revenue. Our year-on-year revenue growth was 19%. On the Expensify Card, the gross interchange was $6.8 million. The growth on the Expensify Card was 118%. Just a reminder, that interchange is not included in that revenue number. We also generate a lot of cash. Our operating cash flow was $32.9 million.
Our free cash flow was $26.3 million. We break out free cash flow from operating cash flow because we do hold on to some customer funds. That's not really our money. We're just holding it. It's basically in transit. If we wanna talk about the money that we actually generated, it's that free cash flow number, the $26.3 million. On a GAAP basis, we had a net loss of $27 million. We've talked about this before. That is primarily driven by stock-based comp. That stock-based comp is primarily driven by a pre-IPO grant we did that went effective on the IPO. We get questions about this 'cause the stock-based comp is quite high. You value a grant based on the value of the stock at the day of grant.
At that day of grant, it was $42 a share. Every, you know, share that vests is we record a $42 expense. It is significantly higher than what the stock is right now, which can make the stock-based comp maybe look higher than what you're expecting. As we've discussed in the past, that stock-based comp is decreasing over time. If you look at the earnings release, we have a forecast on how that is decreasing over time. Now, if you take out stock-based comp, we have a non-GAAP net income of $25.3 million and adjusted EBITDA of $42.5 million, which are very healthy numbers. We're very proud of our performance in 2022. Now let's talk about Q4. Q4 revenue was $43.5 million. Our paid
Average paid members were 779,000. The card, we had gross interchange of $2 million with an interchange growth year-on-year of 91%. We generated a lot of cash in Q4 too. It's kind of a theme with us. Our operating cash flow was $6.6 million, and our free cash flow was $6 million. In Q4, our GAAP net loss was $3.4 million. Again, this is driven primarily by the stock-based comp, which is driven by that grant that we discussed, and for the quarter, it was about $10 million. When you take out the stock-based comp, our non-GAAP net income is $7.1 million and adjusted EBITDA, $11.2 million.
As you might recall, we are currently not giving guidance, but we are giving information on the month that has happened thus far. In the past, we've disclosed that, and we're disclosing it here. One thing we've discussed in the past is that we have two types of users. We've talked about this, but I get a lot of questions on this in the calls, so I want to make sure that we all understand. We have subscription-based users who are locked in for 12 months. They pay every month for 12 months. We have pay-per-use users, which are activity-based. If they use it one month, they pay. If they didn't use it the next, they don't pay. And they pay a higher price.
Since the pandemic, we have seen the percentage of pay-per-use users as a percentage of all users increase substantially to about 35% of all users, which is higher than it's ever been, which has introduced a level of volatility in the revenue that we haven't seen before. We've discussed this on the last call. I've actually highlighted the last three Januaries on this chart in yellow, and you'll see that volatility kinda show up. We usually have a good Q4, in January we see a drop in that pay-per-use, but it's not a sustained permanent drop. You know, it recovers quite quickly. In January, we are seeing that seasonality, that drop in pay-per-use users. It's not a drop in subscription. It's not a, you know, a big turnoff of customers.
It's just a decrease in pay-per-use, which we don't expect to be long term, just, you know, some seasonality that we do see. We are working on increasing the percentage of users as a on subscription as a percentage of all users because that will reduce the volatility. We started working on this push for annual subscriptions in Q4, and I'm happy to report that we've already had some signs of early success. In Q4, new users are trending more towards annual subscriptions versus pay-per-use. In previous quarters, if you look at new users we were adding more pay-per-use users than subscription. In Q4, we've reversed that trend. I do think that we've started to see success in our efforts, and we expect that success to continue, you know, throughout 2023.
We are increasing subscription through a number of different ways. Our sales team is now focused on subscription instead of pay-per-use. Previously, the sales team, they were just focused on getting users and that we didn't really care if they were subscription or pay-per-use. Now they're solely focused on subscription. Similarly, our account managers are also focused on converting customers with pay-per-use users to subscription, and they're prioritizing the customers that have the highest percentage of their employees on pay-per-use and working on getting those over to subscription. The volatility is great when it goes up. Sometimes it goes down. We would like to decrease the volatility in the revenue that we've been seeing. The good news is that this isn't an impossible problem. It's very easy to solve. Move them over to subscription.
We know how to do it. We have started doing it. It is showing success. We think this volatility is a temporary issue that is easy to solve. It's just gonna take some time to solve it, and we're already seeing progress. To summarize, in 2022, we had steadfast performance in uncertain times. We had strong free cash flow, and we were profitable on an adjusted EBITDA basis and free cash flow. Our paid members continue to grow. The Expensify Card up nearly 120% from last year, and we have an exciting product roadmap that opens up more use cases among our customers.
We'll turn it over to Anu for Q&A, but before I hand it over to her, I wanted to highlight that we are now hosting a frequently asked questions in FAQ on our investor's relations page. We get a lot of emails from investors, institutional and retail to investors@expensify.com, and a lot of them are the same questions, so we're gonna just start posting those questions on that page with answers. If you have questions for us, please email investors@expensify.com. We will post your questions and our answers on that page, and we'll be updating that throughout the quarter. That's a great page to check out if you're curious about Expensify and you have questions maybe we didn't answer in this call. Anu, if you want to kick off the Q&A.
Amazing. first up, we have Koji from Bank of America, please.
Hey, guys. Can you hear me okay? Can you guys hear me okay?
Hey, Koji. How are you?
Hey, guys. Hey, thanks for taking the questions. You know, I know you guys are not specifically guiding to 2023, but I wanted to ask you a question on margins, you know, specifically adjusted EBITDA.
Mm-hmm.
I mean, you finished on about a 25% EBITDA level or margin level. You know, is there anything to call out that would make that adjusted EBITDA margin level swing meaningfully to the upward downside from that level this year?
The, our adjusted EBITDA is heavily influenced by our sales and marketing spend. We have decreased the amount we are spending on marketing, but increased the amount we've spent on sales. The, the overall level is, probably gonna be pretty consistent throughout the year, I wouldn't expect a huge shift, but if there's a change, we'll definitely let everyone know.
Got it. Got it. Okay, cool. Just a second question from me. You know, thinking about the share buybacks, could you remind us, you know, how much is left on the share buyback program from here? If you run out of that share back buyback program, are you thinking about maybe potentially expanding it or introducing a new one? Thanks, guys.
Great question. We did about, we did 10, and then we did an additional two. We're at 12. We have about $38 million out of that $50 million authorized. The idea was just to authorize enough shares for, you know, a year or two, or three, and then, when we use that up, make another evaluation. We do intend to use and, I have nothing to announce now, but, you know, when we use that, we'll let you know, you know, if we're reauthorizing more. I mean, at this point, I expect that we would, but we will be sure to let you know.
Got it. Thanks, guys. Thanks for taking the questions.
Thank you.
Next up we have Raquel from J.P. Morgan, please.
Hey, Raquel, are you there?
Okay, we'll circle back to her. Let's go to George at Citi.
Hey, George.
Okay. Hopefully this is not a technical glitch, but let's try Mauro at Piper Sandler. There you go.
Awesome. I just have a couple of questions. First one is around the progress getting customers, from pay-per-use to subscription. Have you seen any pushback from customers on that as you've sort of ramped up efforts to get that shift to happen? Second thing is there a target mix of pay-per-use that you're thinking about either for 2023 or for the longer term? The reason I ask that is because I imagine you'd still want to take advantage of the potential upside you could see from pay-per-use once customer activity does improve.
Yeah. Great, great questions. No, we don't really see a lot of pushback. Actually, what we find is most customers didn't realize that they were they had so much pay-per-use, and they're happy to increase their subscription. It's more just kind of letting them know. Expensify is not very expensive, and it's no one's job to micromanage, you know, your Expensify bill. A lot of times people, when they sign up, you know, let's say they do 50 subscription, and then a year or two later, maybe they have, you know, another 50 in pay-per-use, and they just haven't thought about it since they originally signed up. There hasn't been a lot of a lot of pushback. In terms of an ideal mix, I think that's pretty hard to say.
Historically, it's been around 20%, so I think that's kind of where we're initially shooting for. You're absolutely right that we love having the pay-per-use because if a customer wants to grow super fast and shoot up or they want the flexibility, that's definitely an option for them. We never wanna get in their way or create friction, so we do like having the pay-per-use, but we want to, you know, obviously have as many subscriptions as we can. I think this is. It got a little bit out of balance, and we're just kind of gently pushing it back into balance.
Okay, got it. Just one last thing from me. Can you remind us what your industry exposure looks like today, particularly as it relates to companies in the software vertical? Thanks.
Sorry, can you say the first part of your question again? It's a little quiet.
Yeah. Just trying to get a reminder on what your industry exposure looks like?
Oh.
Maybe as a percentage.
Yeah. Okay.
Of your revenue.
Great. We have an extremely diversified customer base. We have no customer that represents even 1% of revenue. We are certainly very popular in some industries, you know, technology, media, nonprofit, stuff like that. I think different from, some other people in our space is we are diversified, not just within industries but also geographically. We're not just coastal. It's not like all of our customers are just crypto, companies, or we're not, you know, a startup just selling to other startups. We have a lot of mom and pops and, you know, small businesses across the entire United States and Australia, U.K., Canada, around the world. I'd say we're, very well diversified. There are some. I wouldn't say there's like one major industry that, you know, we make all our revenue from.
Cool. Going to the next person. Daniel from BMO, please.
Hey, good evening, everybody. How you doing?
Hey, how's it going?
I'm great. Thanks for taking the questions. I wanna go back to the pay per user comment, the 35% of the customer base that's pay per use. If you track those pay per use customers over time, what percentage of them actually pay you more than their subscription fee would be if they convert it? I guess I just wanna understand, like how many of these are like one-time users or how many have been on the platform for a long time and just spend and spend and spend, more so than they would have on the subscription.
Yeah. Okay. Yeah, it's a great question. The way the math works out, pay per use actually is twice the rate of subscription. Said another way, you get a 50% discount for going on subscription versus pay per use. You're right, if someone is active on pay-per-use 12 months out of the year, they end up paying us more. What we see is that they're actually the break-even point is six months, and we see that they're active in general less than six months. If I had a button right now, that I could push that would convert all pay per use to subscription, I would definitely push that because that represents more annual revenue from us for us.
We would prefer to have them on subscription. I don't think, to go back to your previous question, I don't think the goal is to get it to 0%. You know, customers do like the flexibility that it provides, but we think it's probably too high right now, and we're thinking 20% is probably a better place for us to be in terms of revenue volatility and all that.
Part of the dynamic here is also what Ryan touched on earlier. Like, because the number or actual price is quite low, companies, as they keep growing, don't really look at their bill or review their bill or review their total spend because it's actually materially not significant to their spend overall. What happens is somebody like, I don't know, just to throw out a number, like Instagram, as a company, started off really small, is paying us, never really increases their subscription size, continues on and on and on, grow into a much bigger company. What we're trying to prevent is that one day they open up their bill and think that they're paying it too much, like we wanna take care of them.
It's like they're just actually committed users in that they stick around for more than six months and it would work out better for the company to go to annual. It benefits both Expensify and the company to make them go to annual. That's really how we approach it. Like, it's as much a retention tool as it improves our financial volatility.
It's a great point.
Gotcha. Great. That's really helpful. Then you mentioned a little bit about sort of the importance of freelancers in the workflow. Just maybe could you speak a little bit on that? I've noticed maybe, you know, in terms of, like, per job expense, it feels like that might be going up. Is that because it's getting harder to attract freelancers or because the skill set you need is higher? Like, just, you know, help us think about, like, what that spending could look like in the year ahead, you know, given the importance of both getting the chat out but also doing it as cost-efficient manner.
So.
So.
Go ahead, Anu.
Sorry, I was just wondering, when you say the cost per job is going up, like what do you mean for us? Like something in our financial statement?
Yeah. I mean, like, I track the jobs that you post.
Oh, okay. Got it.
It seems like, you know.
Yeah.
It feels like sometimes, you know, in the last couple months, the amount that you have to, like, post a job for seems like it's higher than it has in the past.
Yeah.
What is driving that, and how concerning is that from a cost perspective for you?
It's a great question. Actually, that's not of concern at all. I'll tell you why. The reason we increase the amount that we pay for a job is if a job has been sitting out there for a certain period of time.
Mm-hmm.
I think Ryan was talking about this when he was presenting the specific use cases. Like when you post a job, there is so much hungry talent out there that I have literally posted a job, and I haven't even moved off of the page, and I see four proposals come in. There's a lot of supply that is soaking up the demand. When a job sits out there with no proposals, it's not because there is no engineer out there that can, like. It's not a bandwidth issue. It's more that the job itself is actually too complicated, so the vast majority of people are like, "I don't know how to fix this." They avoid that job and go to other jobs.
When we increase the price, it's because it's been sitting out there, and it sits out there because it is actually a more complicated bug or a more complicated task. The increase really just like kind of brings us on par with now we need a type of engineer that has more experience, more talent, and so it kinda just pays for the time and it's scales nicely. We only increase it when that when it sits out there for a while, and then it keeps on doing that. At some point, increasing it doesn't make any sense, and we pull it internal, and we use that as a gauge, sort of like we do the first, second responders. Like, if the question is tougher, it goes to the higher-skilled person. Think of it similarly.
The total check, so to speak, that we got for Upwork is still so small that even from an audit perspective, it's just insignificant. There's a lot of room to grow in that space.
It's basically like price discovery, right? Like, if no one's willing to do it for $1,000 bucks, but we do it $10,000. Some engineers don't wanna. You know, they value their own time at certain rates, and if it's very hard, you have to move it up. We don't know exactly what that is. This is basically a price discovery mechanism.
Sort of like surging or something. Yeah.
Yeah.
Gotcha. Maybe just one last one on the card. Can you remind us how much you spent out in travel, in rewards this quarter? Just any update on the transition with regards to Marqeta, sort of the question you get every quarter. Thanks. Thanks to you. Thank you.
Of course. I don't think that we released the specific reward dollars we paid, but what I can say qualitatively is our cashback is still not material to the interchange that we're bringing in. If we do break our cashback, it will be in the 10-Q, but I don't think we do.
It's okay. Yeah.
Oh, it is. I just don't remember off the top of my head, but it is. It's still the same structure. It's 1% if you spend $25,000 at least. It's 2% if you spend $250,000, and the vast majority don't spend $250,000. It's kind of tiered to make it aspirational to put all of your spend on the card, which is the real challenge 'cause it's a big behavioral change. In terms of moving it over to revenue, I think we've been kinda reporting on the progress of that project. We've got all of the contracts nailed down. I think we are probably there or 99% there in terms of getting the accounting treatment nailed down, so that was the bulk of the challenge. Now we are in implementation mode.
What we'll do next is launch it on ourselves, so to speak, like move all of the Expensify employees onto the new program, test it, and then start the transition. You know, without talking about our future plans too much, we have exciting ways to incentivize our existing cardholders to move over to the new program, 'cause that's really what we want. We wanna be able to migrate everyone over as fast as possible and sunset the old program and more to come on that in the following quarters.
Cashback for the year was $2.8 million.
Awesome. Great. Thanks, both.
Yeah. That's actually, it's contra revenue, so. Shows up that way, yeah.
The anomalies continue.
Thank you both.
Thank you. Good to see you.
Cool. I have to see who else is left. Next up we have Eric from Lake Street.
Eric.
Hey, guys. Got a couple of questions here. I know you're not giving a revenue guidance anymore, but it is to me, in Q4. This is a milestone because the revenue growth was only 8%, and you guys have historically been a double-digit grower. How should an investor view the, you know, just the 2023 outlook? Given the current volatility for SMB, do you view yourselves as a double-digit grower?
Yes, I think so. We're gonna continue to grow. I think it's, I mean, if we go into recession's not good for anyone, but we, I think we're better positioned than most, and we are profitable or cash flow positive and we don't need to fundamentally change anything about our business model. We are layering on sales. We think what will be helpful has been, the SDRs are very new, but they're really starting to come online, so we'll start to see hopefully some greater results from that in 23. Yeah. I think that we are well-positioned going into the next year.
I understand you haven't stepped away from your long-term growth outlook, but obviously the near term is a different playbook.
Yeah.
Okay. The interchange fees, I've heard you say in the past that in 2023 you're talking about interchange fees of around $2 million a quarter. Then that's stepping up to around $5 million a quarter in 2024. Are those still good numbers?
You're asking for guidance. We don't give guidance. You know, I'd say the card is growing very well, obviously. We don't expect that to, you know, dramatically slow down and where it's a big focus for us. You know, all of our, you know, sales team members are pitching the card, you know, alongside the subscription. We think it's gonna continue to perform.
Okay. You've made a big investment in account management. I think at the end of Q3, you had 41% of customers have been kinda touched by account management, and in today's press release you said substantially all. As you are reaching out to these accounts, Is the account management program being tweaked? Because I gotta imagine we're getting into much smaller account sizes as we get down into the remainder of the install base.
The main goal of the account management program, and really the job of the account manager, is to be more proactive in terms of in terms of supporting the customer. What I mean by that is, a lot of the time churn doesn't happen because the price is too high. It doesn't happen because they are looking for some feature that we are missing. It's 'cause they have implemented Expensify on their end in some way that is too janky. It's not quite working for them, and they think therefore the product is not working for them, and they start looking for other alternatives.
What we're trying to do is use our account managers to sort of get in there early, make sure the setup is actually working for them, and if it isn't, like, how can we help them set it up so they never need to think about their expenses ever. Because once you do that, no price is too high to pay, and then it's smooth sailing, and they're never gonna take a sales call from a Ramp or a Brex. That's really the idea, and I think it equally lends itself to 10-person company, but also 500-person company. Like.
Mm-hmm.
A good setup is what is the primary goal of account managers. Other goals are things like looking at their bill, making sure that if they have high pay-per-use, then making them cost optimize their bill so they can go to committed seats to the extent that works for their business. Generally, just taking care of the customer so they feel that Expensify is in their corner. That's really it.
Yeah. I think you've used the conversion rate of, like, when you touch a customer, they convert to subscription at 2x the control group. Is that still a good number?
Mm-hmm.
That was what the early results that we saw. That's a good question and maybe something we can post on our FAQ. I don't know if that. That was true at one point. I don't know if it's true right now. I know that we have been successful in reversing the trend, so it's some good rates. We can actually probably follow up with you.
All right. you guys can
On the investor relations, yeah. To, to put maybe a finer point on what Anu just said, a lot of our customers self-service and small businesses, you know, grow quickly, their needs change. They'll self-service with some sort of setup that works for them, their needs change, and then they don't go back and, kind of, update their setup. That's when we say, when we say janky, what she means is basically.
Mm-hmm.
Their needs have changed, and they don't update it. The account managers are basically saying, "Hey, is everything still working for you? Is anything, you know, frustrating you? Let's make sure we use the right configuration that works for you and your new needs." As you said. Just wanna clarify a little bit.
That makes sense. Like a 10-person company grows to 100, they never look again at how they set it up.
Yeah.
It just doesn't work anymore, but no one told them to think about that.
There you go.
That's really the opportunity.
You go from no approvals to approvals to, like, a multi-level approval, like, that type of stuff. Yeah.
Okay. Thanks for taking the questions .
Thank you.
Of course. I think that's it.
Great. Well, thank you all for joining us. We love doing these. We love talking to you. If you have any questions, please follow up with us at investors@expensify.com. We're gonna be posting your questions, like I said, on the Our investor relations page, and maybe your question will get featured on there. Thank you all, and we'll see you next quarter.
Bye, everyone.