Get Forward Customer Count (2026)

Nathan Latka (00:01) Hey folks, my guest today is Brandon Lloyd. He's a three-time SaaS and payments founder who sold his prior company, Bypass, which is POS and payments for sports and entertainment, to FIServe in 2020. At FIServe, he ran 50% of the North American payment flows, which is $3.5 billion of annual revenue and 1,500 platforms, 1.5 million merchants before leaving in June of 2023 to start forward. This is a tough one for me. I'm a hokey. He's a UVA grad. We'll see how it goes. Brandon, ready to take us to the top? Brandon (00:29) I am, I am. Wa huwah. Nathan Latka (00:32) All right. You you've ⁓ you've been battle tested in the payments space. Tell us what forward is. What are you guys selling? Brandon (00:39) Yeah, I mean we really the story begins as me building software companies. So we we started our first software plus payments company before FinTech. was a word ⁓ in Charlottesville, Virginia, actually on the lawn is where we started our our very first one. And I like to say I learned payments through the School of Hard Knocks. We made a ton of mistakes. In fact, that company we sold to Pfiseurf we did over 20 different payment integrations. And with each one we learned a little bit on the technical side, but also and probably more importantly on the business side. About how these payments agreements worked with legacy PSPs. And what I came to be frustrated about over many years was that the software companies were not getting a fair shake. Even though they had acquired the customers and they were originating the payment traffic through their software, vertical software platform, they were earning a fraction. of the payments income. And so forward is really about paying it forward. So we went back into our community of software founders and CEOs and CTOs and GMs of payments and we're helping them build payments businesses inside their software company. Nathan Latka (01:59) Really interesting. We've got your story up here on the page. I assume off campus solutions was the launch on the ⁓ UVA lawn right back in the day. Brandon (02:08) That's right. So that very first business, if if you have a kid or you went to college and you were able to use your student ID card at a local area merchant like a Papa John's or a Jimmy Johns or a Domino's, ⁓ we pro we created those networks and enabled it so parents could put dollars on those ID cards and they could be spent by the kids at at local area merchants instead of having to eat in the hall. I call it a business with training wheels. The total addressable market wasn't very big, but we learned a lot in our early 20s and sold that to SIDEXO, which is a multinational ⁓ contract food and beverage company based out of Paris. Nathan Latka (02:51) Brandon, was that a meaningful financial exit for you personally, or do you more just take the learnings from that and say, Okay, I got an exit under my belt, I still gotta go hustle, build my next thing? Brandon (03:01) Well, at at twenty-six, the definition of meaningful is is different, right? kind of the way I would say that. It was, it was. It was a great outcome for our investors. and ⁓ I had an opportunity post-acquisition to to work for this very large organization, 180,000 people in North America, and I was like the kid at the table. All of my peers were in their fifties and late fifties and they would always look at me when I showed up at meetings and and think like who who invited their kid to work today? ⁓ but my job was to basically take what we had built and ⁓ Blend it in with a whole host of stored value investments that they had either built or acquired over the years. And and so we learned a lot. And then actually, one of our first employees at that company, when we sold it, went to Stanford to get his MBA. And he was out there and he called me one day and said, Brandon, mobile wallets are gonna change the world. And the you have to remember, this is in the heady days. There was a mobile wallet actually, unfortunately, named ISIS. ⁓ I think it was the the retailers, and they ultimately changed the name, but the carriers were in the business, and Apple and Google, and that just everyone was after this is a long time ago, ⁓ the mobile wallet. And so that was the impetus for bypass. We said, let's build a remote order and pay application in live event. Nathan Latka (04:15) Cheese. Brandon (04:36) Let's let people buy a beer or a hot dog and not miss the game, not miss their favorite song. And no one used it. So we built it, we rolled it out, and ⁓ maybe we'd get like twelve transactions a night. I'm talking about in a major league baseball stadium, twelve transactions. You you're gonna you're gonna be in a food line quick. ⁓ and so we pivoted that business into a full blown commerce system, and at the end I think we processed one in four live events payments in North America, every major sports league, live events, music festivals, if you bought something in and around that venue, it was run through through our system. So you're a local Austin guy, if if you went and bought something at DKR Memorial Stadium where the UT Longhorns play, ⁓ that ran through us. same was true for Circuit of the Americas and and and many other locations. So we had a couple of folks look at buying that business and ultimately ⁓ sold it to FiServe ⁓ but w what was really First Data and FiServe had merged and First Data acquired that and it's now called Cloversport. Nathan Latka (05:47) Mm-hmm. How much had you raised at bypass before you exited? Brandon (05:51) Gosh, that's a great question. I don't know that I recall off of the top of my head, probably around twenty million dollars over the course of three rounds, I think. Yep. Nathan Latka (06:04) Okay. And what was the product pivot? I mean, that's a massive change in strategy to go from twelve orders a night in a sixty thousand person stadium to billions processed annually. Did did do you sell direct to stadiums and the stadiums mandated all the attendees use the app and that's how you got more distribution, or how'd that work? Brandon (06:11) Okay. Th think of it as we shifted from B to C to B to B. So instead of putting an app in the hands of the fan, although we still did that, and they could still order a beer and have it delivered to their seat or order a hot dog and skip the line and just pick it up, it was now like a feature of a larger product. And our system was actually a full replacement for at the time the market was really a duopoly between NCR, which stands for National Cash Register and was founded in like 1905 or something like that. And Microsoft, which is now owned by Oracle. But they owned the market. Every point of sale system, every commerce system in live events ⁓ was one of those two systems. And so we broadened the capabilities of our technology stack and really moved the data to the cloud, which is what the market was interested in. Because if you could if you could move the data to the cloud, you could interact with the customer in more. personalized ways and ⁓ that's what these sports teams and and ⁓ music venues were were really after but it was Nathan Latka (07:30) Did you raised twenty million? Go ahead. Brandon (07:33) I was just gonna say you called out. It was a big change. I mean, going from, you know, dozens of transactions, hundreds of transactions, to millions of transactions. And one day I got a call from somebody, and I cannot remember his name, but he was at AWS and they said, You have broken our autoscaling technology and we're not sure how. What are you doing? And the reality is in the fall you have the NFL, the MBA, I think the NHL, college foot. Football, all these sports coalesce at the same time. And so if you run 30 or 40 or 50 halftimes of major sporting events across the entire United States, all on top of each other, you get to a massive peak load problem. It was a super fun technical problem to solve, ⁓ but it's easier to say that now than when I was in the fire of trying to solve it. Nathan Latka (08:30) I want to get forward you know, no pun intended forward to your the current company, but just to close out the bypass story, you'd raised twenty million there. Was the exit price or range of the exit price publicly disclosed? Can you share that? Brandon (08:42) It wasn't d not disclosed. Again, it was a solid outcome for our investors and ⁓ and you know honestly the founders of the company as well. Nathan Latka (08:53) Okay, so if I could ask it differently, the waterfall went deeper than just the liquidation preference, the preferred shares, common stockholders, early employees, everyone made money. It was a good in the money deal for everybody. Okay. Brandon (09:03) Yes, a strong ⁓ O I C if you're speaking that language. Nathan Latka (09:08) O I C for those of you that are not from finance is multiple on our on basically capital put into the business. We put a dollar in and you get a dollar fifty out, it's a good mow like there, one point five X. So that's good story there. But you you're then at Pfizer's able to keep you for a little bit, but ultimately you're an entrepreneur. You want to go back to building, control your own destiny. Take us into forward, right? I'm gonna share the product page here. What are you selling today? What's the company do? Brandon (09:29) Yeah, so so at the highest level, one of the biggest changes in payments today is that from 1980 to 2000 banks used to process payments and they outsourced to payment processors like a global payments or a physerv or a thesis. And then from 2000 to today, we had e-commerce and Payments that used to be entirely in the real world now took place over the internet via e-commerce merchants. And that gave us the likes of Stripe and Adian and PayPal. But there is a bigger wave of foot that began probably 10 years ago and we're in the middle innings of it, which is that payments are embedding into software and embedding into workflows. And so if you're the owner of a gym. You used to go to a bank and open a bank account before you opened the gym and they would say, Do you want to take payments and do you need a card? Now, before you ever walk into that bank, you go and pick the vertical software company that you're going to use to run your gym. And one of the things that software company does is collect payments from your customers on your behalf. Those software companies plug into our infrastructure. We process and settle all of those payments. And in doing so, we create a revenue stream for the software company that's equal to or greater than what they're generating in software. This is the big unlock. So when when I meet a private equity-backed software company that's doing $15 million in software revenue, they should be doing $15 million in payments revenue. Most are not. Nathan Latka (11:18) If they sit close enough to the payment stream. Brandon (11:21) That's right. But I mean, it's a playbook. You can do it. I've done it fifteen hundred times. It's repeatable. But what happens is Somewhere along the line, someone sticks their hands in the cookie jar and takes the lion's share. And so we oftentimes will meet software companies that have 15 million in software revenue and they have a million dollars in payments revenue. And we'll say, we're just going to implement our infrastructure, we're going to put you on fair, transparent pricing as opposed to opaque predatory terms. And you're going to see your ARPOO, your revenue double. And you can imagine what that does to MOIC. And so, you know, there are 50,000 plus vertical software companies in North America alone, and most of them are not achieving their potential. And that's what we do. So there's a technical Nathan Latka (12:14) So, Brandon, are you I mean, do you compete? Sorry to cut you off. I just want to jam as much into the twenty minutes here. Do you compete directly with Stripe here? Are you offering a better take rate than Stripe? Brandon (12:23) Half of our clients upgrade from stripe to forward. Nathan Latka (12:27) So what is Stripe charging the average merchant, right? The average so you know, because we have software companies listening right now, right? And let's say that they have fifteen hundred customers and those customers process, you know, tens of millions of GMV at their businesses every, every, every month or every year. The take rate if they launched an embedded payments platform, if if it was on top of Stripe, would be what? And then what do you guys charge? Brandon (12:48) Yeah, I'm gonna tell you a story to bring that to life, but let me answer the question directly. If you simply go on to Stripe and sign up, they're gonna charge you 2.9% and 30 cents. And we run into software companies that are twitching twisting themselves in a pretzel to charge above market rates so that they can make money on top of that. The income they should be generating is out of the 2.9. percent and thirty cents, not in addition to not marking up a more expensive price to their customers. In a pri let me let me tell you a story that'll bring this to life. These payments guys, they get what yeah, they get what they can. Okay? So I w in a prior life five PL leaders and I pulled them into a meeting, I said everyone had a PL north of five hundred million in revenue, n some north of a billion. Nathan Latka (13:27) Use a real example if you can. Brandon (13:45) And I said, everyone go around the room and tell me what you sell and what you sell it for. And all five leaders were selling the exact same thing at demonstrably different price points. Some people were selling it for two pennies, and some people were selling it for a dollar. That makes no sense. So the payments industry on the embedded side has long operated in a in a world where the price is dependent on how much you know. If you don't understand the space, your price is high. If you understand the space, your price is low. And that fundamentally is one of the business innovations that we're bringing to the table. Our price is our price. It's fair. Nathan Latka (14:31) But Brennan, what's the what's the I I get everything you're saying, but what what is the I mean, let's use your own calculator here, right? What is if someone if someone's listening right now, because a lot of these folks are, right? The people are thinking about doing SaaS plus GMV. So it's a big opportunity here to clearly tell them why they should use you instead of Stripe. If they have three thousand SaaS customers and twenty percent end up using payments and all this sort of checks out, are you saying one pr three million of new revenue to the software company listening today? Or do you what what's your take rate out of this? You have to make money somehow. Brandon (14:59) Yeah, so you're on our attach rate calculator, which is actually the bigger lever and I'll come to that in a minute. But the way I would think about this is there's about a hundred basis points of spread between what a merchant pays and the cost of interchange. Seventy to eighty percent of that should go to the software company. Most of the time twenty to thirty percent is going to the software company. So when I look at a Stripe customer thinking about upgrading to forward, I'm looking for a 2 to 3x increase in their take rate, just moving to our platform. That's one piece. That's the cost piece. But if you get distracted by the siren song of cost, you're gonna miss the bigger opportunity, which is what we call a tax rate. So if you have 10,000 customers today and only a thousand of them are using payments, you're leaving a huge opportunity on the table. At forward, we help our software companies sell payments to their customers so that they can get that attach rate north of 80%. And that's the real driver. Nathan Latka (16:04) So are you arguing a better product experience here? Yeah. Brandon (16:07) That's right. And and keep in mind, you know, it's more than just product, it's also services that are alongside the product. If if you integrate payments into your vertical software company and put a button on the website, your attach rate will never be greater than twenty percent. You have to contact them, your customer, and answer their questions. What do they think they're paying today? What is your offer? What are the benefits of your offer? It's not something that you can just throw a button up and and and hope that you're gonna achieve scale like service Titan or Toast or Mind Body. There's plenty of examples that can get to very high attach rates. It's possible, but it's work. And that's what we do on behalf of our clients. Nathan Latka (16:50) So, Brandon, let's just if we can, just a direct answer on the economics, right? So, if if I'm if I use your software and it's a great product experience, my attach rate goes up, and I'm charging three percent to my customers, right, to process their GMV. You're saying the fixed cost of the three percent just for the Rails is gonna be one per sorry, two percent. So there's one percent of of spread basically. Am I good? Am I accurate so far? Okay. You're not taking any of the two percent of hard costs, so you're splitting the one percent between Brandon (17:12) Yep, that's right. Nathan Latka (17:18) What I would keep as the own the user of forward and what you guys keep. What you're saying is you guys would keep maybe thirty bips of energy of of spread and you'd give me sixty, so I can increase my revenue. Is that sorta like what this the split looks like? Brandon (17:31) That's right, 14 to 28, depending on which program you're in. If you're just using our licenses, our technology, our money movement, our risk services, you're gonna pay 14. And if you're also using our ⁓ attach rate services, we call it maximize, you're gonna pay twenty-eight. And that is a fraction of what software companies pay today. Nathan Latka (17:54) Hundred percent. Okay, this makes complete sense to me. So now let's shift back to you. You you know the space extremely well. You are in the volume game. You've got to sign up and get billions and h hopefully tens and hundreds of billions flowing through your platform. So you that that fourteen bips you take to twenty eight bips starts to really, really add up. How did you get your first a hundred customers? Brandon (18:13) ⁓ great question. So we do a lot of work with institutional investors ⁓ who have really figured this game out that they can buy a software company and double its revenue using payments. But oftentimes they need some support. And so in some cases, private equity firms work with us almost exclusively. They send a company to us, we execute our playbook, they double the revenue, their recap happens in two or three years instead of eight years, and they call us back and say, can you do that same thing for the rest of my portfolio companies? Other times it might be partner to partner. One partner at a private equity firm will use us as a default and a different one will use a different provider. But that's how we started. is a lot of private equity folks we've worked with over the years that that knew of us and knew what we were trying to do, understood the value prop and saw that it was symbiotic with their their business model. Nathan Latka (19:19) Okay, that's first hundred customers. There are deep partnerships. If we fast forward to today, how many individual vendors are using your platform for embedded payments? Brandon (19:29) Yeah, thousands of merchants and a hundred plus vertical software or AI platforms. So At Forward, we don't focus on very small software companies. If you're just getting going, we might send you to Stripe, right? You're trying to prove out your business model. But when you get to three, four, five thousand customers, that's when we can make a huge difference. And so, as part of our process, when a new platform comes to us, at no cost, we do an evaluation to figure out how much. Income they're leaving on the table. And if we can't make them three to thirty million dollars, we're gonna say just stay where you are, right? Make this adjustment in your next renewal, right? We're not trying to get high numbers, we're trying to really focus on those projects where we can move the needle because demand for us has consistently outstripped supply, meaning there are more software platforms that can. get introduced to us via referral or private equity firm in a given month, then we have the capacity to stand up today. Now I'm working on that and we're trying to add more capacity each quarter, but it's a very large market. Nathan Latka (20:58) Can you give I mean your north star, I mat correct me if this is wrong. The thing you can get GMV thro that's going through forward up, right? I mean that is a good leading indicator if the business is growing or not. Would would you agree that's a top metric? Brandon (21:11) I don't think of it that way. ⁓ I think a lot of payments folks do. I think about it as our software platforms payments income. So are they achieving their goal? Right? There are lots of technology platforms and payments that you can go to that will say, Here are the APIs, don't call us good luck. Right? Nathan Latka (21:39) Yeah, I get that, Brandon. You're helping you care about onboarding and the attach rate going up, which is why software platform payments income is a key indicator for you. But isn't that the same? I mean, if that goes up, so does GMV through your platform. Brandon (21:51) They're correlated but they're not the same, right? We we want to make sure Nathan Latka (21:54) Why is that? Sorry, how could you how could you increase software platform payments income but not increase your Gm V? Brandon (22:00) Well, let's say I took the strike model. I could grow GMV demonstrably, but not grow partner payments income. Because I'm keeping the lion's share. Right? So how you define your true North KPI does matter. It matters for culture, it matters where you invest and how you invest. And for us, we're driven by that outcome. Is the software company getting to the payments outcome that they set out to achieve? Because most do not. And I was that guy. Like I was that guy for 20 years, like kept trying 20 different efforts at bypass to get payments right, made a lot of mistakes, and I said, we're gonna be the partner to our software platforms that we always wished existed. Nathan Latka (22:35) Yeah. No, I like that. That's super helpful. I love that metric. So can you give us a bit of the growth rate with that metric in mind? Did you break, I don't know, a million of software platform payments income your first year in business in twenty twenty three? Brandon (23:05) Yes, an order of magnitude of that. The company has been consistently growing at a rate greater than twenty percent month over month. We have never Nathan Latka (23:16) On the metric you just gave us, right? Payments income. Brandon (23:20) That's right. And we have not yet disclosed, although stay tuned, ⁓ for our GPV and that processing volume number that you were asking about. And the reason for that is we're tracking platforms at our same age and determining how is our traction growing relative to theirs when they were two years old and three years old. And we intend to provide that to the market at the Nathan Latka (23:54) Can you give any indication of growth over the past four year? Twenty percent's tough, right? 'Cause if you go from a dollar to a dollar twenty, right? That's twenty percent month over month growth. But I've you've been here before, I think you're much bigger than that. Can you give any ranges or indications there? Brandon (24:09) Yeah, I mean the company, well, even if you start at a dollar, if you grow twenty percent month over month for a long time, the numbers get big. ⁓ this year, let's see, I was just looking at May. I think May is up eight hundred percent year over year. which will give you that that context. As I mentioned, like we haven't disclosed absolute dollar figures. From there you can back into lots of things and Nathan Latka (24:33) Mm-hmm. Brandon (24:34) ⁓ you know, all in due time. ⁓ I'm very happy with the growth rate of our organization and I think it's on track to meet or exceed some of the fastest growth rates we've seen in the space. And that's not just to be clear, that's sure it's a compliment to our team, and I think they do a great job. And it's a compliment to the product, which is super easy to use. Our clients integrate and launch in less than 30 days. Nathan Latka (24:47) Mm-hmm, mm-hmm. Brandon (25:02) But really, it's a nod to the distribution model. If I am signing up merchants one by one, it's a slower way to grow than if I'm signing up software companies who've already signed up customers. And so that leveraged nature of our growth model allows for the kind of compounding growth I was referencing. Nathan Latka (25:24) Mm. Mm-hmm. Yeah. Yeah. It's just it's hard for my audience to wrap with like no indic I mean, even if you keep the range extremely broad, can can you say tens of millions or multiple billions at this point, or you don't even want to disclose that? Brandon (25:38) Well, You the the the s we have clients that are making millions of dollars in payments income. And we have over a hundred clients live and processing payments through the platform. So from there you can start to back into numbers. Nathan Latka (26:02) That's super helpful. Yeah, no, thanks for letting me push you on that. I know that's maybe an exclusive or something you haven't shared before, but it helps people understand how you're just being very thoughtful on how you grow. now what is the hundred you just said you have a hundred customers live. How is that different than the earlier quote you gave me on thousands of merchants and a hundred plus API and software platforms? Brandon (26:22) Same thing. So think of a client being a vertical software company or a vertical AI company, and their customers being merchants. So in this example that I mentioned earlier, the gym is the merchant. And the software, the gym software company is our client. And that's really the way to think about this business B2B to B2C. Nathan Latka (26:46) Yep. Yep. Okay. Super interesting. You've you've raised some capital on this. You've also announced a strategic relationship with Cross River. I'd love to understand both. So talk talk me through this. Have you sort of bootstrapped or have you raised a bunch of money? Brandon (26:58) Yeah, we have announced 20 million in capital raised for this business. ⁓ and Cross River we have a relationship with a a large number of banks. ⁓ you can think about As a registered payment facilitator, we are moving money every day that a bank is open today. And so funds clear to us from the networks and the issuing banks. Our system is the system of record that determines what fees get applied and how funds get moved and reconciled. And then we instruct the banks to make those payments to the various different merchants. I won't get too into the sausage in terms of issuing and the Acquiring and how all the funds move. But in the United States, Cross River Bank has been a great partner. They're kind of, I think they describe themselves as a fintech that happens to be a bank. They have a great set of core banking technology, APIs, and otherwise that we connect into in order to operate our business. We also operate in Canada, and in Canada, our bank is Scotiabank. And so a lot of software companies, it's It's very easy to grow your software company throughout North America and they go to try to create a payments integration in Canada and it's a whole new 12-month project. In our system, if you're live in the US, you're live in Canada, and vice versa, which is a huge benefit. If most US domiciled software platforms have 85-90% of their business located in North America. Nathan Latka (28:42) Mm-hmm. You've been in this space a long time. I'm guessing FiServe is both an investor and a customer. I think you've publicly announced that, but you picked CrossRiver for the banking provider. And all of us are aware of the recent press over the past couple of years with Evolve and you know other you know, people that sit in the middle, like Blue Penguin and Unit and others in this sort of, you know, payments tech stack space. So I mean specifically, respectfully, you know, Crossriver haven't had an FDIC consent in 2023 around fair lending and third party complaints. clients. So when you were doing your diligence on which bank to partner with on this, you have probably had many options. How did you and how and why did you choose Cross River? Brandon (29:20) Yeah, I I think for one, you have real scale experience at Cross River. When you look at the types of programs and the amount of funds, not just the diversity of the programs, but the flows, the size of the flows, Cross River is is a bit in a league of its own when you marry that with the technology. And so you know we In different use cases, we use different banks. In different use cases, we do a ledger across multiple providers for that belt and suspenders approach that you just referenced. And we're a big believer in having our own ledger get shrewd against the bank's core ledger each and every day, which is something that we do regardless of who our banking partner is. but I I I don't look Cross Rover's a great bank. They've been a good partner to us. We work with other banks who've also been great partners to us as well. Nathan Latka (30:22) Fair enough. Sort of like how you guys are doing tool calling to figure out if you put the credit token through open air anthropic. Brandon's kind of doing the same thing with, hey, he's got a dollar of new GMV throwing through his gym or his vertical SAS. Does he put it through Phi Serve or CrossRiver or whatever other banks sort of he's working with? Brandon, I assume that's also there's probably margin differences depending on where you process each dollar of volume as well, right? One one Rails might take the two percent, someone else might be one point nine five percent, and that affects the margin profile. Brandon (30:48) Not so much like if you at the end of the day these networks publish interchange tables. So Visa, MasterCard, Discovery, Amex, they set the price of interchangeable tables. Nathan Latka (31:59) Yep. Well yeah, Brandon, I want to be respectful of your time. You know, we are big fans of Stripe. We also know they're expensive. And so you know, we're in America. Capitalism is beautiful, competition is an amazing thing, and we're excited obviously with the traction that you've got. Appreciate you coming on today. If people want to follow your story, where can they find you online? All right guys, there you go. Brandon, thanks for taking us to the top. Appreciate it. All right, guys. Cut. Good stuff. Brandon, appreciate you letting me push you on some of that stuff. I just think more folks will listen, understanding some of that volume stuff. So thank you. I wanted to push you harder, but I'm like, I'm I don't want to make him uncomfortable, so Totally understand. Well appreciate you again. Good luck. Take care. Bye.