Good morning. Now we have Adam and Brian from Intellicheck.
Hey, everybody. Thanks for coming in. Hopefully, this is Mike. You can hear me and all that. I'm Brian Lewis, President and CEO. Adam Sragovicz, who's our CFO. For those of you following on the webcast, his presentation's on the IR page at intellicheck.com. As always, we'll start off with that forward-looking statement thing, just so we can make sure we're all covered. Let me start by saying that I've heard some people say that, yeah, I've looked at this company, and there's nothing to see. I want to start out by saying, you looked at the old Intellicheck, right? What I'd say is, just a few short years ago, we were only doing $1.6 million in recurring revenue. Last year, we were doing $20 million, right? Quite the difference in what we've done, right?
Already in Q1 of this year, with upsells and renewals, with price increases, we renewed $10 million in ACV. Shows how sticky we are with our customers. We completely retooled our tech stack over the course of the past couple of years, take advantage of AI and data science, because we see the information on about 100 million people in North America come through our system every year. That also is going to allow us to really drastically reduce our core processing costs. We've also wildly diversified our client base. We used to be very tied to retail credit cards. Now we're growing very quickly in retail banking, in email background checks, which I am very, very excited about, logistics and shipping, because the amount of theft and fraud that happens there is tremendous. Small but growing is social media.
I'll just get to that right away, right? Everybody talks about, when is social media going to come live? They're live, right? We have contract signs, we have purchase orders, and we're processing transactions from them. Now it's just, when did they turn on this ticket? We're going to be talking to them about that shortly. What I can say is, given what we see in our contracts and our committed go-live dates, I don't need social media to grow at a respectable clip this year. It'd be nice, but we don't need it. I think banking, background checks, and logistics should really lead the way. I just want to preface the story with that, because I want to tell you why we're different and relevant, right?
Which Gartner, in their last report, said that we are unique in what we do, and we're the only ones with what they call privileged access to information to accurately identify a fake or fraudulent ID. That really explains why we matter, OK? Let's just start off with the magnitude of the problem, right? Fraud continues to go up. This is financial fraud, right? There's also all the other kinds of fraud about stealing your identity. Our CTO's niece was arrested because somebody stole her nursing credentials and ID and pretended to be a nurse. The cops came up and got her. This is a much broader problem than just financial theft. Last year, $27 billion, that was up significantly, right? $16 billion in account takeover fraud. That's what happens to the banks.
We have a bank who tells us that every month, in one of their branches, they get hit for one transaction of about $40,000 or more. It is a pretty big issue, right? That is what we solved very quickly, very easily. I will talk about some of our competitive moats, right? Here is what most people do. Afterwards, I have got six licenses in my wallet. Hopefully, TSA does not catch me. Come by my booth and see if you can pick out the fakes. I love doing this game. I do it at airports. I did it last night at dinner. Nobody can figure it out. The reason for that is, most of these come from China. They have got every hologram. They have got every design. By the way, this real ID thing, what a baloney thing that is.
Every one of my fakes is a real ID. Within 30 days, the real IDs are for sale in China, right? It does not work. What our competitors are doing is using a machine to do what your eye does. It does not matter if everything is already there, OK? What we do is we have been working with the DMVs since they started out with barcodes. We taught them how to do it. That means we have access to information that is in those barcodes that are hidden security features, OK? The important thing is, no two states, no two provinces, no two U.S. territories use the same barcode. There are 250 of them in circulation today. Competitor gets one. You have 249 to go before you can even compete with us. You cannot figure this stuff out with AI. It does not work that way.
AI and machine learning makes it really easy to copy what's on a physical document. Doesn't mean you can figure out what's in that barcode. There are things like digital signatures. Everybody knows public-private keys. That's all that kind of stuff that's in there. We know those things, right? A couple of other things, right? We authenticate close to 100 million people, right? I'm also going to say one of our competitive moats is we are hardware-free. If you want to use one of our competitors, right, that means you need to take an image, which is why we always win in an in-person situation, right? I use Kohl's as an example. Many people know that's one of our customers, right? They've got 1,121 stores, 15 point-of-sale workstations on average in each.
If they wanted to use one of our competitors who needs a digital image of that document, they'd have to buy a scanner. That scanner even discounted is $600, right? They're not paying 1,121 times 15 times $600 when all you need to do with us is a configuration change on the scanner to read a 2D barcode. Takes about two weeks. It's not a problem at all. With that, we do a couple of things for them. We absolutely speed up the acquisition of credit. It's one of the reasons that retailers like us. If you look at Nordstrom or Macy's, their financial filings, they make as much, if not more, in their credit card programs than they do by selling merchandise. It is truly important to them, OK? Really important.
The other thing is, none of our competitors, we believe, can say so many law enforcement agencies use them. Law enforcement are the only people that can supposedly go back and check against the database to make sure that the license is real. However, if any of you in this room are in the UnitedHealthCare hack, your full driver's license information has been exposed, which means when I go to the website, I can match that license with a fake perfectly. The document discriminator number, as well as the driver's license number, your name, your age, all of that will exactly match what's in the DMV, and you're going to look real, OK? A couple of things, just talk about, again, how we work. Again, we work in the digital world. I'd also say this.
I believe we're better in the digital world because, again, we don't require a photograph. I challenge anybody in here, even in this room with this light, to try and take a photo with your phone of your license that's in focus without glare, because if there's glare on it, I can't read it to see if it matches the template because all that's whited out. That's why there's a lot of false negatives and other things with folks that need that photo. With us, we turn your phone into a scanner, scanning the back of the ID, the barcode. We can tell you with certainty our success rate on processing a transaction is 99.975%, right? What we're told from our competitors, from our customers we've taken competitors away from, it's about 85%.
That increase in transactions means a lot more revenue for them because everybody gets they want to cut their fraud, but they get bonused on new customers. We're helping them bring on new customers much more quickly, OK? Again, super simple, frictionless. The scanner in a bank can read it. Your phone can read it. The scanner in a store can read it. Simple configuration changes for everything that we do. Why I feel that we are positioned for success, as I said, 100% renewal rate. I kind of look at our business as two separate businesses. The previous management had spent a lot of time trying to sell into bars and restaurants. I hate that business. It's a pain in the butt to support. They go out of business, right? We have churn over there because the bar and restaurant goes out.
100% renewal rates of any customer that matters. I did a study on this a couple of years ago. Our average financial services customer within the third year is spending about three times what they started with us in year one. We see significant growth in use cases. We also build in, contractually, price increases every year because they find that much value. The ROI that our customers see, we're talking to a customer right now, one customer, we saved them $56 million last year when I looked at their three largest credit cards. The retailers they issue credit cards, and the average new credit card issuance was $750. Multiply that out, it was over $56 million. They absolutely love us. Again, our gross margins consistently above 90%. We do not need legions of people to run this business, right?
With the existing tech stack and people that we have, we could probably do three times the customers we have. Only need to add some customer support people just to make sure people are happy in what's going on. What I think, I hate being blacked out, an attractive current valuation of about two times revenue. Again, just to give you an idea of some of the places that we're used, so you understand, because what I'm going to bet is there's a significant portion of the people in this room that have gone through our system, but you never knew it, because we're completely white-labeled. You never see us at all. If it's in the digital world, we give them something that the customer completely white-labels. If it's in the physical world, all you're seeing is somebody scan a license, and you wouldn't know that it's us.
Growing very quickly in automotive, we've got great channel partners there and talking to some others. In real estate and title, we probably have about 43% currently. If I look at the market share, we've got the two top title insurance companies, the two top providers of software to the independent title insurance companies, and I think number five and number nine in title. Between auto and title, hopefully, interest rate comes down, and we see a lot more stuff there. The amount of fraud going on there shocked me when we first started looking at that. Instant credit, lease to own, buy now, pay later, subprime, all the people, the underbanked that are really easy to steal their identities because they don't have a lot. Surprising thing, we're growing in universities. We just looked at our first university.
8.9% of every student aid application that they have coming into them is using a fraudulent ID. I think in California alone, it was like multi-billions of dollars lost in Pell grants to ghost students that are out there. Retail, new issuance or card not present, I like my Best Buy points, but I haven't seen my Best Buy card in probably 20 years. I walk in and say, hey, I want my points. They ask for my license. We scan it. We send it off to the bank. The bank says, yep, Brian has a credit card. Give it to him. In the bank branches, it's interesting. The largest incident of fraud is in the call centers because that's the easiest place to come in and begin to take over your account. We're big in the call centers. We're big in the digital.
We're about to be releasing with one of the banks their entire retail branch network. That should be, I think that's going to be a significant driver of growth in 2025. Employee onboarding, this is one of the areas that really excites me. This partner we have does a lot of the background checks for many of the big box stores. Currently, right now, everybody needs to make sure that people are really legal citizens and they're doing things. Most of the time, they're using fake IDs to get hired. Also, in a lot of areas, email and social media, it's account reset and validation. That's kind of the bigger areas, everything from property management to are you the right person when you're walking into a manufacturing plant?
They want to make sure that you're not a spy or something like that. Now, one of the reasons that people like what we do, again, is this proprietary barcode that only we have, right? That's our database. Nobody else has it. And we update that all the time. Near 100% decisioning, we're going to give you an answer. Our competitors cannot say that. Again, no new hardware. I think that's a serious competitive moat, right? No bank wants to pay $10-$12 million for hardware for their retailers. The retailers, they certainly don't want to pay for it either. A whole bunch of stuff about the other things we do. Everybody can do facial recognition. I mean, that's becoming a commodity nowadays.
Most of our customers do not want to put their customers through that friction because they trust the first step so much because we can show them how many good customers they lose because we've already seen the ID, it's good. The third step is the facial recognition. They see the customers drop, and they realize, oh, man, I just lost the LTV of that customer because I made them go through too much friction. With us, they decide that they do not need to do it. All right. We can do straight document. We can do OCR, make sure what's on the front of the document matches what's in the authenticated barcode. We can also do facial recognition. In the digital world, we can also do a whole bunch of things. Geolocation, does the phone number actually match the name of the license?
Does the address of the billing match what's on the phone, match what's on the driver's license? Additional risk signals if people want to do things like that. In addition, again, we're talking to our customers now. Each one of our customers sees what they see. We see what they all see. How do we then use we've got some really smart data scientists looking at what can we do with that data to partner with our customers. This to me would be like a 2026 initiative to say, what can we do with that data to help their processes work better, right? Some other people might say, OK, we're doing a billion people, but we're not trying to get into India, right? We don't care. That's not our forte. Nobody does what we do here in North America, and that's where we are playing.
We're very focused on that. Even though we're a small company that a lot of people might not have heard of, we've got really big name players, right? When I got on board, this is what I first did. I went after these guys. I was shocked that they didn't make us put code in escrow because, again, $1.6 million in burn in cash. They didn't. We have top 10 bank, $400 billion in assets, one of the top five credit card issuers. Another one with 2 million accounts, one of the top three credit card issuers. Top 10-15 bank with over $2 billion in assets, right? These are not small potatoes. Our clients are real and big. The thing that is phenomenal about these, our top first banks will get on the phone.
We got the three last regional banks we had because the heads of fraud at those banks got on the phone with the heads of fraud at our prospects. They tell them, you really need to use Intellicheck, OK? In 2024, I just want to bring out some significant callouts on what we've done. One of the biggest banks bought a new bucket that they thought would last the year. They do not expect that to work out. We are now renegotiating a new contract with them. They are growing very quickly. The top title insurance company signed up with us and is about to go live. We have a lease to own company that is now going live over 1,700 locations. Again, a private university with that ridiculous fraud rate going on. Qualia is in the title space.
That's a real estate transaction platform that does the money transfer. Doma Title, the eighth largest, has gone live. Accio Data is about to go live. They're the ones I was talking about to provide the background check software for a ton of retailers. I think this proves that the diversification strategy that we put in place about two years ago, the retail was off last year, right? Retail, if I go back and look at bankruptcies and general retail being down, was about $2-$2.5 million in revenue to us. We still grew. That's because we were growing in these other areas. I knock wood that retail comes back and the economy gets better, and we should have some real tailwinds, which are great. Wire customers, fast, simple, easy, easy to explain, and the minimal amount of customer friction.
I love these two quotes from a couple of people. The head of fraud at one of the largest banks out there said, we are a true game changer in stopping fraud, top five of all time, which is why he recommends us to everybody. Before the New York State DMV and SLA started using us, they ran a thousand through us. We caught every single one of them. I think that says a lot. You can go look at this. Who cares? Just a bunch of non-attractive people, but that's our management team. Some financial highlights of Q4 2024: $5.9 million in total revenue. The company used to be very, very into hardware, which I hate. I got us completely out of that. We are nearly 100% SaaS now. Sometimes we'll buy some minor hardware for people. $5.9 million in SaaS.
Gross profit margin at 91%. Currently, cash and investments of $4.7 million. Stockholders' equity is $17 million. We have zero debt. We've got a very, very, very clean cap table. Net income of $488,000. And adjusted EBITDA of $860,000 for the quarter. Analyst coverage. For a small company, we are pretty well covered. Northland, D.A. Davidson, H.C. Wainwright, and Craig-Hallum. Again, clean cap table, 50% of our outstanding shares are owned institutionally. At the end of it, you get the EBITDA reconciliation, which is why I need Adam because he's way smarter at that than me. I like to be short and quick and all that kind of stuff, but that's who we are. If there's any questions, I'd be happy to answer them. Yeah. They aren't doing anything.
The hard part about a lot of things like eVerify and TSA and everything, they're closed-loop systems. Everything has to sit in there, which means you're always behind because when a state updates their driver's license format, which they do major updates a lot, and then throughout that period of time, they'll do minor, we can't get it in there. It's not always super accurate. That's one of the reasons that we're working with the background check companies because they can sort of then present that to eVerify on our behalf. Yeah. Azure to AWS, correct. Yeah. Yeah, we actually, yeah, we brought our second largest client live on Monday. We've moved over. We probably have about two or three other big clients. Some of the big guys are like, oh my God, this will be a 20-year project, right?
They've already tested and it's working. Everybody, every single one of our clients has been in the test bed, can connect to Azure, and everything's running. Now it's just their internal approval process to get it done. Yeah, the goal is probably by the end of Q3 to be completely done. Yes.
That's sort of one of the problems about every other form of ID. Other than a passport or a passport card, there is nothing in there that you can use to definitively say it's real. We can do those things, but we're only as good as everybody else because all you're doing then is comparing that photo to a template of what it should look like. A passport card has an RFID chip in it that only customs and border control. I was talking to people that manufacture those.
They can read that from 60 ft away. With a passport, if you've got a proper in-store scanner that will read the chip, you can do it. If you are doing it remotely, it can only be done through a native app on the phone, which most people don't want to do. For the most part, even with a passport, all anybody is doing, again, is templating. Does it look like the passport should look like it? Because all of our customers, most times in the validation, it's a one-time thing. They don't want to have to drop software onto somebody's phone. Yes, sir. What I'll say is, and here's where I look at it. There's MyTech, Jumio, Socure, Authentic ID, Authentics, Veriff. All do it that way. They all do what I described on templating, right? They all talk about AI and machine learning. Okay.
What they're doing is trying to, how do I make my template better with AI and machine learning, right? I think it's a lot of marketing. They all do it the same way. They're the ones when we go head to head, we win. We just had three wins where we were in head-to-head tests with one of each of those. We won every single one of them. Yeah.
[Inaudible] Right. Those kinds of systems just to make them have a substantial higher revenue winner, not only one investor, which is growing, but also a more potential customer. Some of them may run out of fees and you will have to hand them the shit that you're working. Some may just go, well, we might have a little bit of driven because we've heard of that because we're relevant. What do you do to build your brand among those potential customers?
I got rid of all of our internal marketing, and I outsourced it to a company out of Silicon Valley who's been very good at working with high-tech, high-growth companies. They've already, since our customer engagement is up about 200% in two months because of everything they've done to the website and all of that. We are using stuff, right? The fact that Gartner is saying what they're saying about us, we're using that in everything. I will admit, that's our biggest hurdle. Everybody thinks because everybody is the same when they hear of us, oh, you must be just like them. Like, no, no, no, no. Give me 15 minutes. I'll show you why we're different. When that happens, light bulbs go off and things start moving. Cool. Anything else? Yeah.
My big thing is a lot of it, I believe, is going to be through partnerships, right? Finding people that are already in the spaces that we want to be in. For the mid-tier banks and things that do not have their own back office and run their own operations, you have got the Alloy's, Jack Henry's, Galileo's. We are in advanced contract negotiations with some of those folks now. Nothing yet definitive, but given where we are, I would expect that is not going to be an issue. What I like about that is the reason we got into those is we go to some credit unions, and there was one that we were dealing with that had used Socure, did not work, went to prove, did not work.
We gave them one of our tools to try us out, and they went to their provider and said, you need to put Intellicheck in your platform because we worked. It is a little bit of gorilla, a little bit of better marketing, as Aaron was asking about. I think upgrading, and one of the reasons we brought in a new head of sales, a guy that was very, very successful at Ping Identity, I think is going to help us with that as well. I do believe channel partnership, it's a phenomenal way to get in very quickly. That is why we've grown so fast in things like auto and title, and now I think background because they're already there. Yeah, we'll have implementation fees when we're bringing somebody in, but it is people commit.
What we have moved everybody to, like our large banks now are going with, they commit to three years with a minimum floor, but if they grow, they can up it in years two and three, which my whole point in that is I want to be able to start. Part of our hard part is when we were really transactional interviewers, very hard to give you guys guidance so you could tell us. Now I can say we signed definitively X amount of TCV. I think the hook's coming for me. All right. All right. Thanks, everybody. We're booth 509. We're slammed, but if you want to stop by and I have time, I'd love to talk to you all. Thanks. Have a good one.