How VizyPay Reached $21.5M Revenue and 13,000 Customers Serving Rural Small Businesses (Interview with CEO Austin Mac Nab)

Introduction and VizyPay Overview

Nathan Latka

00:00Guys, vizypay.com is the POS system that rural small businesses are using. They are powered by Clover. He just spent a million bucks buying additional Clover hardware to get installed. He's got over 13,000 signed customers, tens of thousand installed POS systems. They did 1,850,000,000 in transaction volume last year, representing 35,000,000 transactions. They did about, call it 22, $23,000,000 of total sorry, 22 yeah. About $22,000,000 of total revenue, hoping to hit, call 25,000,000 this year. He's got 95

00:31full time folks on the team and his go to market is a very unique combination of ten ninety nine contractors that can keep and build 50% residual revenue streams for selling the vizypay product in their local communities. And also he's now the big bet they're making is how can they get w two full time employees performing in a unit economic positive way. He uses local bank to fund $1,500,000 of debt to keep growing the business because

00:51he has bootstrapped the entire thing. Imagine owning a 100% or close to a 100% of a 25,000,000 business. Austin has done it. He's staying patient, building it the right way. Hey, folks. If we haven't met yet, my name is Nathan Latka. I launched and sold my first software company back in 2015 and went on to write a book about it, which you guys made a Wall Street Journal bestseller purchasing over 30,000 copies. Thank you so much

01:14for that. After the book, I launched this show and one went on to create founderpath.com. I raised a large fund to do non dilutive deals with b to b software founders. So far, we've invested in over 400 software founders totaling a $150,000,000. Here in 2024, we're doing three to four new deals per week. So if you're looking for capital and don't wanna give up equity, go sign up at founderpath.com for free to get your offer. Alright.

Rural Small Business Focus as Differentiator

Nathan Latka

01:42Let's jump into the interview. Hey, folks. My guest today is Austin Mac Nab. He's the CEO and founder of vizypay. They're a prominent provider of payment technology solutions for rural small businesses all across The US. He's got over nineteen years of experience doing this, and he's an expert in the payment processing bank card and retail industries. In 2017, he launched the company with a goal of disrupting the status quo of the payment space to help small businesses

02:06level up their operations and save money on processing fees. Austin, you're ready to take us to the top?

Austin Mac Nab

02:12>> Yeah, absolutely. Let's roll.

Nathan Latka

02:13Your team went out of their way in your bio to specifically say, quote, rural small businesses. Why is that? Is this a key differentiator between you and Stripe say, or Square, sorry.

Austin Mac Nab

02:25>> Yeah. I mean, that's been kind of our differentiator since we started and that's, I think, helped us excel to the next level being bootstrapped from the beginning till today is we are focused strictly on, you know, rural American communities, which we believe technology is passing them by specifically in the payment space. You know, big companies, and you can probably name them, you know, a couple of them that are on the stock market or not, that their

02:50>> focus has to be in bigger cities where there's more transactions, bigger population, more payment processing because they don't actually have people to answer to to a certain extent. Right? Mhmm. Well, that also leaves a lot of rural American businesses behind technology when it comes down to making their business more efficient, that's fair priced, that is not that is simplistic, not complicated, and that allows them to kinda go from that. I always say go from that flip

03:16>> phone stage back in the the good old days to let's get into a smartphone. Right? But within the payment space kind of concept. So Mhmm. We really go into smaller communities and and that's where we have a lot of our boots on the ground across The United States.

Revenue History and 2023 Growth

Nathan Latka

03:28So guys, as you know, what I love featuring on this show are founders that are quietly crushing it, especially when they have big VC backed funded competitors. And what I love about Austin, just to summarize when he came on in February 2023, we're recording this episode Wednesday, 03/13/2024. But he launched the business in 2017 at about a $100,000 of revenue that By 2021, 12,000,000. 2022, 18,000,000. So about flat year. Not not flat, sorry. 6,000,000 in extra

03:55revenue there. And then 2023, I can't remember Austin, if this is what you told me you were gonna do over it's what you closed with, but you said I think 25 to 27. Is that sort of where you came in last year?

Missing the $27M Target and Managing the Gap

Austin Mac Nab

04:05>> We so from 2022 to 2023, our growth is about 19%. So we went from 18,000,000 to about 21,500,000 of revenue. Yep. This year, we're anticipating to do around 26 and a half as kind of our our revenue projections and goals. There's another about 23% increase we're looking to do. But, you know, we did jump from, you know, that 19% from '22 to '23, and which is a big big deal for us just because we don't have

04:31>> that VC backing. We don't have that PE backing. And when it's sort of declining, we actually increase by a good amount. So

Nathan Latka

04:37Yep. Yep. Well, look, I always appreciate how transparent and vulnerable you are. So I wanna dig into this because a lot of founders in your position go through this. I do remember you said last year in February when I interviewed your target for 2023 was 27,000,000. You still grew, which is fantastic, especially considering your capital structure, your bootstrap, but you only grew to 21,500,000, so 27,000,000. Look, in my head, who cares? You still grew and your

04:57economics are still good. But how do you manage sort of that with your team at the end of the year? Hey, guys, we wanted to do 27. Good job. We got to 21.5. Here's what we want do next year. How do you sort of manage that gap?

Austin Mac Nab

05:08>> That's a great question. That's a question, you know, we've talked about a million times over just because naturally you're liable or shoot. We we we fell short right now. I think the biggest thing about, you know, starting a startup and and building it the way we have built it to bootstrap is, you know, we gotta find a lot of positive and sometimes negative situations. And one would say that, hey, gosh. You know, we missed the mark

05:30>> by a huge amount, man. And you all suck. We all suck, man. We let's let's close the business down. Right? It's not gonna work out. We gotta fire everyone. Right? But that wasn't the case. The case was we grew by 19%. We went from 18 to 21 and a half. And all we had to do is say, alright. Why why was there a gap? Where where did we fail, but not really fail, but we can learn

05:49>> from so we can make 2024 a better year to get closer to the goals we wanna reach. Right? So we had to look back, and we had to look back at the mistakes we made because we're not perfect. I think when you're starting a company from scratch, no matter which way you look at it, you don't have a bunch of bigwigs that can call you up and get advice from you. You gotta figure out yourself, you

06:08>> know? Mhmm. And with our company, know, one of the biggest things we've done to kind of, you know, start our organization is when I started. I have, you know, almost twenty years experience now. But the nearest person next to me at our organization is at seven years, which is as long as we've been around because we hired about 95% of our staff that have no industry experience whatsoever out out of almost a 100 employees. So, naturally,

Lessons Learned: Over-Hiring in 2022-2023

Austin Mac Nab

06:31>> the creative ideas sometimes don't work. You know, they're gonna fail, fail quick. We're gonna have to pivot. And last year, we we learned a lot about, you know, that we launched the w two model over the last twenty four months, you know, '22, '23, we learn our gaps. We learn where we make mistakes, where we need to double down on, you know, what we need not to do, which maybe we don't need to hire as many

06:49>> people, but we need to double down on the very people we have today, incentivize them, get them to the next level instead of worrying about bodies. We're worrying about the bodies that are currently here and leveling them up. And I know that was part of the reason why we probably didn't hit our revenue numbers because we were getting our face slapped without knowing it until we looked at the numbers at the end the year because, you

07:08>> know, we were still growing. So it's like, hey, high fiving still. Right? Yep. But nowhere near where we wanted to be. And I think we just had to learn from the mistakes and some of the failures. And I think that's what we did. And that's why 2024 is exciting.

Nathan Latka

07:18So those of you listening now, couple of minutes in this interview going, wait, what is vizypay? I don't know what it is yet because maybe you missed the first interview. His first customer is an auto repair shop. Today, he's serving folks like restaurants, rural coffee shops, rural mom and pop businesses. He's not it's not just software. Right? He's gotta deal with the upfront cost of the actual hardware of which he's got 10,000 clients that keep two

07:38to three POSs sort of per client location. So that's tens of thousands of pieces of hardware there. And in addition, Austin then makes money after that on a per transaction model. He's processing at least about a year ago, over a million transactions per month, and then takes 1.8 to 2.5% of interchange there as well as the revenue model. So when you go back and look, Austin, and please correct me if any of that is wrong after

08:00I ask this question. When you go back and look at what assumption cells you put in forecast

08:05model at beginning of last year, which assumptions were wrong? Was it really just people based, like you just said, or were you projecting 50,000 installed POSs and you only hit 10,000?

Austin Mac Nab

08:16>> I think it was a mixture of both, right? And every year that's gone by, we've been able to be more and more granular with our projections. Right? And what I mean by that is I think that sometimes you get you you look at a kind of a high level broad number. Like, let's say, you know, a number of you know, what's what's revenue divided by number of accounts? That's that's kinda what it is. But reality, that's

08:36>> not what it is when it comes down to what we make. Right? So what we had to look back at and say, well, we missed it by the mark of assuming how many sales we're gonna get. I wanna come down to number of bodies we have, and we overextended. And this is something that, hey. I'm not afraid to admit it. We overextended the number of bodies we should have hired, which ate right into not only, you

08:58>> know, our our our our, you know, losses, but it also took a lot of time and like, really good time of our people here to get the people that were really doing well and doubling down and get them to, you know, double their sales. Right? Mhmm. That's What is that?

Nathan Latka

09:14Austin, can you quant I mean, every founder goes through this. Right? It's like, we're bringing on new AE. What should their quota target be? That's number one. Number two is how long does it take them to ramp? And sometimes most founders are too aggressive with those. They think it's gonna ramp, it's gonna take six months, actually takes twelve. They think one sales rep can hit a million dollar quota, can only hit 500 k quota. Right? Were

Inside Sales, 1099 and W2 Channels Explained

Nathan Latka

09:30there like, what were the bottlenecks for you where the the Excel model didn't pan out how you thought it would?

Austin Mac Nab

09:36>> It it came it came down to, like, how we look so we have a couple different ways of actually getting sales. Right? So we have inside sales, which is in house that focuses on, you know, marketing efforts to get people to call us throughout these communities. And we have a ten nine nine channel that are boots on the ground, that are independent contractors that can work anywhere. And then we have a w two model. Right? And

09:55>> the w two model is what we invested in for the last couple years, 2022 to 2023. And how we look at that is the w two model is more of a controllable thing because there's a lot of great individuals that don't wanna be an independent contractor and and and be that entrepreneur.

Nathan Latka

10:10W two model. You're talking about you're hiring full time employees. They're not contractors.

Austin Mac Nab

10:13>> Yeah. Full time employees, salary, the whole works. 1099 is no salary. It's just purely commission. Right? So how looked at those individuals is we have to look about what revenue are they bringing in and giving them time to ramp up. Right? Because if they're new in the business, it takes about sixty days. We give almost like two, three months, right, of ramp up. And as long as they're doing basic actions that we need to see to,

W2 Ramp Time and ROI Timeline

Austin Mac Nab

10:36>> you know, you know, number of leads hit and proposals and stuff like that, we kinda know. And then then we start looking at, well, how much revenue are they bringing in per month comparative to their salary, and are they able to pay themselves off? What we found out was it takes about six to eight months for an ROI on a w two employee to make the money back when it comes down to what we're paying them

10:55>> salary wise plus, you know, commissions, whatever. That's kind of separated. Mhmm. But what we weren't doing was we were giving too much time to people at one point in time, and we weren't putting enough time in the people that are actually were hitting stride. Right? So then we realized, well, we need to, I hate to say it, cut quicker and double down more on the people that are seeing traction because this is a new business for

11:18>> a lot of people that are coming into it. Right? So when we fell short on some of those goals last year, it was because I think we overlooked the fact of the matter. You know, we we thought more bodies equate to more sales. When that's fucking not true. Yeah. That's not true. Right? So and and we realized that that we can't think that way anymore. So this year, what we've done this year is night and day

11:39>> difference is we said we're not gonna go on a hiring spree. We're not gonna go try to hire 30 people.

Nathan Latka

11:44What what's full time today? How many people full time?

Austin Mac Nab

11:47>> Full time, we have, right now, 95 total.

Nathan Latka

11:50Okay. And how many do you think you'll hire full time by the end of the year? Like, how conservative is your estimate there?

Austin Mac Nab

11:55>> This year, our goal is to hire no more than, like, two people. Like That's great. Goal is not to hire a bunch of people this year. This is actually gonna be the first year we're trying to actually go in the positive, not stay in the negative. Right? You know, we're trying to kind of focus and leverage ourselves to be in a better position going into 2020, you know, '5

Nathan Latka

12:12You mean positive or negative in terms of cash flow or EBITDA?

Austin Mac Nab

12:15>> Cash flow, EBITDA, you know, positive revenue, not loss in the P and L. Right?

Bootstrapping and Community Bank Debt

Nathan Latka

12:21But you're bootstrapped, Austin. Right? How do how do you fund losses if you're bootstrapped?

Austin Mac Nab

12:26>> How we so how we fund, you know, losses throughout the year is either we put more money in, you know, that we maybe pass. It might

Nathan Latka

12:31be good for you personally where you put money in yourself.

Austin Mac Nab

12:35>> You you could. Yeah. Or believe it or not, there's ways out there to leverage your current company's, you know, you know, valuation or your cash flow, your growth trajectory, and you could partner. Like, we we partner with a local bank that is a community bank, and we showcase to them, hey. What instead of taking PE money and getting and losing equity, let's go in debt instead a little bit. Right? So we took a little debt to

13:01>> actually allow us to fund some of that in those gaps, which has helped us out substantially. And when I say debt, I don't mean let's go out and let's get a $100,000,000 in debt. That's not what I'm talking Yeah. I'm talking about getting enough money to bridge gaps that we knew that were gonna happen, which we did have to have happen. And then this year

Nathan Latka

13:16So how much was that? You're talking like a million from the bank or 500 k or something?

Austin Mac Nab

13:21>> Last year was 1,500,000. Okay. We worked with the bank on and we we worked with them based on our projections and based on our current revenue growth, etcetera. And they they bought into, you know, our vision. Right?

Nathan Latka

13:33Austin, how how do you do that? I talked to so many founders at our software that they are so fed up trying to do anything with their local bank because the local bank won't loan against a software company. Did you have to use the hardware POS systems as collateral to put up against that $1,500,000 loan to get the bank to understand how to underwrite you?

Austin Mac Nab

13:50>> Well, I I it's it's it's it's up to be honest with you because there's a lot of education part. Right? We went to a like, literally, it's a community bank. Right? They have no clue what we're doing. Right? So we had to sit down with them and we went with their board, the whole works, and say, hey. This is who we are as an organization. This is what we're doing. This is what we're focused on. This

14:09>> is where we gain our revenue through residual base, through hardware, through, you know, long term relationships with clients in these communities. And this is our, you know, I I think proofs in the pudding is important. Like, we knew the year one and year two, year three, like, there's no way you a bank would even look at us twice. Right? Yeah. But when you're talking about bigger revenue numbers of 10,000,000, 15,000,000, well, they tend to look at

14:29>> you because there there's two hopes. Right? They're gonna make money on the interest and and and high five if you make it. They're gonna want you to be one of their clients. Right? So we had to basically showcase the bank that, you know, our residual growth based on processing volume is increasing, not decreasing. And this is what we get from it. And they eventually understood it. And then once they did that, they they got an appetite.

14:52>> And and don't get me wrong. They didn't wanna write a fat check for 1,500,000 and say, go get them, Tiger. Right? They said, well, what are you gonna spend it on? And then they released it slowly based on need and throughout the year. Right? Because they're gonna they're very, very conservative naturally.

Nathan Latka

15:06Did you have to sign a personal guarantee?

Austin Mac Nab

15:09>> Abs absolutely.

Nathan Latka

15:09Okay. So you personally did. Got it. That's what makes them Is comfortable, you personally guaranteed it. They're looking at your own personal finances and plus they love the business structure. You'll be get then bank debt, by the way, I mean, know, obviously I'm in this space, right? Most people can't do what you've done because they're not at 20,000,000 of revenue and they're maybe personally not wealthy, But if you can do this, you're getting this bank debt

15:29probably at like prime or so for plus like two or three. It's very cheap money. It's relatively cheap money.

Austin Mac Nab

15:34>> Oh, yeah. Yeah. And that's better than giving up equity. Right? So so we did that, and and we have a x amount a year payback, and and we're very comfortable with the pay plan. And we knew that we could turn that money into a lot more, and we did. You know? In my mind, we turned 1,500,000 into, I mean, much more than 1,500,000 over the next three years because I mean, just run the numbers.

Nathan Latka

15:58You grow from 18.5 to 21.5. Right? So you're adding 3,000,000 up to ARR. If you one day sell for 10 x ARR, you added $30,000,000 of equity value for 1.5. Know what I mean? It's like, this is pure arbitrage.

Austin Mac Nab

16:11>> Yeah. No. No. No. No. No. No brainer, in my opinion, if you can get to that point and doing it. And don't get me wrong. It wasn't like the first bank we talked to said, hey, Let's do it. Right? I mean, it took some time and effort to play the numbers game. You know what I mean? And then we finally found a bank that, you know, believed in us and believed

Nathan Latka

16:27in our to move all of your deposits, your bank your business operating account to the bank that eventually did the loan?

Austin Mac Nab

16:32>> Yeah.

16:33>> I mean, that's one of the biggest things they want is to see those deposits flowing in because that's how the bank is, you know you know, they consider themselves successful. I mean, the very person that helped us is now our CFO. It's kinda crazy how that works. Oh, wow. So small world. Right? So now the very person that understood everything about us is now currently today our CFO. So now, you know, he understands everything in and

16:54>> out, and it made a lot easier. And guess what I didn't have to do? I didn't have to hire someone from our payment space. And again, the reason why I never did that because I've been around so long that this is a lot of bad habits, I didn't want people I'm not saying that we would never hire experienced people. Just imagine having 95 experienced people at twenty years plus. We all have the we we might have

17:13>> the same mindset and stuff like that. We wanted to avoid that. So I am glad we got it.

Clover POS Hardware Investment Strategy

Nathan Latka

17:16Yep. Has anything changed moving forward moving forward about your revenue model? Do you still charge about 58¢ per transaction?

Austin Mac Nab

17:23>> Oh, yeah. Mean, nothing's changed about our revenue model compared to last year. It just now is comes down to what we're focused on, and I think we briefly talked about it last year, is we're focused on putting so there's two type of terminals out there. There's a the small one, we call them stand alone terminals. You walk into a store. They have a little machine you swipe through. That's stand alone. POS systems like a Clover. You

17:44>> probably heard of Clover. It's the white system. You it's like a POS system. So going into this year, you know, we basically put almost $1,000,000 into equipment because we saw it work last year.

Nathan Latka

17:55On Clover or stand alone?

Austin Mac Nab

17:57>> On on Clover. And we I mean, literally, I moved out of my office. I wish you could see it. I'm not sure if you've seen online, but I moved out of my office because we had to use that as a storage room for that million dollars worth of equipment. And that

Nathan Latka

18:10was on Clover Clover POS system. It's just stacked up there right now.

Austin Mac Nab

18:13>> Stacked up there. I'll send you a picture later. It's hilarious. You know, we did that, you know, late last year. And what our goal was, we realized that people that have POS systems that are are as easy to use, simplistic, and they have more options, They tend to stay around longer and they do more volume even in rural America. You know, believe it or not, there are people that do good volume in rural America, and they

Transaction Volume and Processing Goals

Austin Mac Nab

18:35>> stay around longer because they're able to run their business in a different way than they ever have. So they're stickier and also they do a little bit more volume, which helps our cause of, you know, we make money on the processing volume. Know, last year, we did 1,850,000,000, 35,000,000 transactions. This year, you know, our goal is based on projections is around 2,250,000,000 and over 30,000,000, you know, well over 30,000,000 increase per month. And and that's what

19:00>> we're looking to do this year, and we only can do that if we're setting ourselves up for that, which is why we invested into more hardware POS systems for

Nathan Latka

19:08these Do you think this year either you you finished last year with 1,500,000,000 of total transactions flowing through vizypay powered POS systems, whether standalone or through a partner terminal like Clover, and that equated to 38,000,000 total transactions. Is that right?

Austin Mac Nab

19:23>> 1,850,000,000 last year Oh, eight twenty three and thirty five million transactions. I see. I see. So this year, we're trying to get up to, you know, 2,250,000,000, which adds roughly around $30,000,000 per month in processing volume. And in in our business, I think that's unheard of being where we started to where we're at today with no outside money. You know?

Nathan Latka

19:43Well, yeah. Mean, that that also you told me last time that the average credit card swipe at the auto shop that your Clover system is installed in is the average swipe is 25 to $30. Right? So if you're trying to add that much processing volume, you're trying to get about a million more credit card swipes across all of your installed customer base per month. I mean, that's a lot of growth.

Austin Mac Nab

20:02>> Yeah. And I think right now, based on, you know, right now we have seen since November of last year, we've seen our sales steadily go up. Mhmm. Even through the holidays, we naturally the first month the first couple of months of any year for us personally in the payment space is slower because wintertime and, you know, summertime stuff is, you know, basically slowed down during those winter times across The United States, especially in the Midwest where

20:25>> a lot of our business is. But now we're seeing a huge pickup, which we always do every single year, which is during spring, summer when marinas are opening up and all these, you know, places on spring break, all these things starts increasing. So what what happens every single year in our business is we'll have a low point, which is usually around January, February. We'll peak around August. We'll maintain that peak even if summer business is closed

20:46>> because we've added so many new businesses deals in, and we'll maintain that through the next peak the following year. And that's been that way since the dawn of time.

Nathan Latka

20:53I see.

Austin Mac Nab

20:54>> That's what I feel like. And even with my last company.

Nathan Latka

20:56Yeah. Alright. Hey, as we wrap up, let me just make sure I got this breakdown right. So you've got 95 full time employees. How many ten ninety nines today?

1099 Contractor Network and Lifetime Residuals

Austin Mac Nab

21:03>> Ten ninety nines, we have over a 125 to active ten ninety nines across United States, and we have probably close to 500 in training. That's a continual number, meaning they never got their first deal, but they're giving an opportunity to us to teach them the products and services to sell to their communities. And and we try to get them to, you know, obviously buy into that too. What's the

Nathan Latka

21:24take back on that? Is it 10% of first year revenue or how do you structure that incentive?

Austin Mac Nab

21:29>> Well, ten ninety nine are different than W-two's, right? So, you know, ten ninety nine's when they first get in the business, we usually share 50%, you know, of of a breakeven market that we set with them so they can build a reserve base for them.

Nathan Latka

21:41Per month or per year or ongoing forever?

Austin Mac Nab

21:44>> For for for for every account, and we do what we call lifetime residuals too. So as long as those accounts are active with us, we are able to continue paying them residuals. So you could actually set up three deals a day, I don't know, make $500 a month, and we'll pay you that even if you don't get another one again.

Nathan Latka

22:00I see.

Austin Mac Nab

22:01>> The the profit. So we actually split that to get independent contractors, not they buying

22:05>> in for the residual portion long term, not just the upfront money we're giving them.

Nathan Latka

22:08100%. Does that how much money are you paying each month in the 50% commissions out to the 125 active ten ninety nine's?

Austin Mac Nab

22:18>> When you when you comes down to like what we're residual based, what we're paying out to those guys?

Nathan Latka

22:22Exactly. Per month based off all the deals they brought you.

Monthly Residual Payouts and Margin Structure

Austin Mac Nab

22:25>> Well, last last month alone, we paid well close to a million dollars of residuals out to w twos and ten ninety nines. Yep. You know? So we're we're we're paying a a good chunk of money to individuals out there because, know, hey. Look. When we first started, ten ninety nine contractors were the easiest because if they fail or didn't wanna go work or didn't do anything, we had to spend no money. Right? These are ten ninety

22:46>> nine contractors. Now, obviously, that catches up to you when they actually start hitting stride and they start building residual base. W two's opposite. We have to front load all the money. Yep. In hopes they make it. So but we also know that that's a better opportunity for us long term because, you know, those are individuals that we can keep more profit long term as well.

Nathan Latka

23:05Yeah. It's a yin and yang. I mean, if you're doing about a 24,000,000 run rate, say 2,000,000 a month, then your cost structure is sending a million out to the 1099 and w two is a portion of which is fixed, a portion of which is variable, which is less risk. It still means though your cost of goods sold, your margin here is, you know, 50% in the best case scenario right now monthly. So I guess, do

23:22you see any, I guess, are you just sort of okay with that? You have make the business work with 50% margins or do see way to buy back some of that margin over time by buying out like the perpetuity, you know, payment stream on some of the ten ninety nines or something?

Austin Mac Nab

23:33>> Yeah. That's the current market for Us revenue stream out in in total when it comes down to net is about 43%, by the way, just just so about 43 because when you incorporate everything, there's deductions, callbacks because, you know, accounts cancel, whatever maybe. It's about 43%. But either way, that has been lowered from fifty two percent three years ago than the 43%.

Nathan Latka

23:52Okay.

Austin Mac Nab

23:53>> And just to be fair, 43

Nathan Latka

23:55cost structure, 43% is cost or 57% of your gross margin?

Austin Mac Nab

23:59>> So it's 50% is our end.

Nathan Latka

24:01Know, we 57% is what

Austin Mac Nab

24:03>> you keep gross profit. Yeah. Correct. Yeah. And we've down we we would push that number down. We pay basically about 43% out in residuals based on what we get paid through that revenue stream. And we're and our goal is to lower that number to 40% or less over time. And you can do that in a lot of different ways. W two's help with that cause. Right? You can also do it by buying out independent contractors, book

24:22>> of business for some x multiples. What would that be? Go buy houses. What would that be? It depends on well, it depends on the situation. Right? Depends on how healthy their book is. I've seen as high as 25 multiple, and I've seen as low as seven multiple. Of of monthly. Think about a monthly residuals. So Yeah. You know, I've seen a little I've seen literally, the highest I've seen in my career is about 35, and the

24:43>> lowest I've seen in my career is five depending on how healthy their book is. And that's how we look at those independent contractors. So they basically are building their own their own credit line for long term.

Nathan Latka

24:53Yes. Yeah.

Austin Mac Nab

24:53>> You could buy out of yeah. So that that's something that we could do. And that also puts that money right back in our pocket.

Nathan Latka

24:58I was gonna say, Austin, that's I'm saying. If if you prepare yourself to go into an M and A process, which, you know, I I I have no inside information, but if you did and you wanna increase your margins, what you could say is we're paying a million out per month right now to these contractors. Let's go offer them all seven x of that. See if see how many will take it. So you're gonna you need

25:12to raise 7,000,000 to go buy back 43% to your margin, basically. And that margin improvement, you're gonna get more equity gains probably than the 7,000,000 cost to buy that back anyway. So that's an arbitrary that's, you know, it's a play you could make down the road potentially. Is that right?

Austin Mac Nab

25:25>> 100%. And that's and this business is known to do that a lot, you know, of the time. And we know that that is a line item that we can utilize if we ever wanna go down that bridge Mhmm. And make that a focus. And we could do that hopefully maybe by ourselves without doing that down the road. Who knows? So Yeah. Yeah. Yep.

Nathan Latka

25:41Well, if you

25:42need $7,000,000, we would love to fund that one day at Founderpath.

Austin Mac Nab

25:47>> Fair enough. Fair enough.

Nathan Latka

25:48Awesome. This is good stuff. Let's wrap up here with the thing. Actually, before we wrap up, I I didn't give you any time to really talk about future product. Is there any future product releases that you're really excited about? You wanna make sure you get some exposure here on the show?

Future Product: Clover Apps and CRM

Austin Mac Nab

25:58>> You know, there's a couple of things we're doing. So, you know, Clover is something we decided to partner with. Instead of spending the millions upon millions that they have spent over the years to become the dominant, you know, software they are, We decided to partner with them because we're with Fiserv. Fiserv happens to own Clover, and we are building out application. Kinda think about your iPhone. You can download apps. You pay money for us. This these

26:20>> all works. Well, Clover does the same thing. So we are building out applications on the Clover device that not only can be used if you process with us, but could be also be used if you don't process with us for the programs that we focus on, which is cash discount and dual pricing and and, you know, inventory management, the whole works. We're building those apps for our fintech team. So now we can be exposed not only

26:41>> just to clients that are processing with us, but we can also be exposed to clients that are not processing with us too for another line item of SaaS fees. Because, you know, we would charge monthly for those apps. Right? So we have done that. I think that's something that's key. And then, you know, one other thing that's key is tying our whole business of managing, you know, sales reps, w two, ten ninety nine clients or works

27:01>> into a CRM that we've, you know, have been building for many years and and really allowing us to, you know, manage our organization outside third party management systems. I don't know what we do and how we talk to our, you know, our team and how we manage our our overall sales force. So then that's something that's interesting too. So those two things I would say are the the biggest things we're working on.

2024 Revenue Goals and Customer Targets

Nathan Latka

27:22Well, we'll watch closely. We're excited for this. If you hit on everything you're hoping to hit on this year, what do you think you'll finish this year revenue wise? What revenue will you finish the year with, you think?

Austin Mac Nab

27:31>> So there's the company goal.

Nathan Latka

27:34Give me the conservative.

Austin Mac Nab

27:35>> Conservative goal is 25,000,000.

Nathan Latka

27:37Okay, got it.

Austin Mac Nab

27:38>> The Austin Mac Nab, you know, let's blow my socks out of the water goal is 26.5. So

Nathan Latka

27:45That's awesome. And how many customers do you have today?

Austin Mac Nab

27:49>> Today, we're a little we've signed over 13 plus thousand clients. This year, we're trying to add over 4,500 clients to our book of business through our all our channels, sales channels.

Famous Five and Closing

Nathan Latka

28:00So That's awesome. Alright. Well, rooting for you. Let's wrap up here with the Famous Five. Number one, your favorite business book?

Austin Mac Nab

28:06>> Business book. You asked me this last time. I always tell people I don't have a business book. David Goggins, I think Can't Hurt Me was a great last book I, you know, lesson to and or whatnot, but I always said my favorite book is the one I'm writing every single day.

Nathan Latka

28:19There you go. I love that. Number two, is there a founder you're following or studying?

Austin Mac Nab

28:24>> Gosh. I don't really probably follow a lot of founders. I think Mark Cuban stands out to me. I think I like that guy a lot, but I don't really follow many.

Nathan Latka

28:33Number three, what's your favorite online tool for building vizypay?

Austin Mac Nab

28:37>> Favorite online tool for building vizypay? Yep. Gosh. That that I can go on all day. We we use Microsoft Teams and

Nathan Latka

28:47Microsoft What call tracking? What what maybe call tracking solution do you use? You do a lot of out like calling.

Austin Mac Nab

28:53>> Yeah. Yeah. Zendesk is actually what we've started our company on and we have built our company on through a ticketing system for clients and agents. So I would say Zendesk is a great option that you can API into as well.

Nathan Latka

29:04Number four, how many hours of sleep do you get every night?

Austin Mac Nab

29:07>> I get to sleep probably around 11:30, twelve, then I wake up at six every morning. So I would say five, six hours a night tops.

Nathan Latka

29:14That's good. And so married, three kids?

Austin Mac Nab

29:18>> Married. We just celebrated our twenty first anniversary and three kids, 18, 15, and 13. And my 18 year old is graduating high school shortly, he's going to be our next company apprentice April 1. It's pretty exciting.

Nathan Latka

29:30Wow. That's well, and you're I think you had a birthday, right? So you're 39. Is that right?

Austin Mac Nab

29:35>> Yeah. December 9 was my birthday. So '39 turned 40 this year.

Nathan Latka

29:38So 21. So you met your wife, I guess then when you were what, like 18?

Austin Mac Nab

29:43>> Yeah, yeah, yeah, we were young. We started young.

Nathan Latka

29:46Yeah, that's awesome. Very cool. Last question. Something you wish knew when you were 20.

Austin Mac Nab

29:52>> A hard life, a hard life really is an adult when you have adults probably. I wish I would have known that a little more, but yeah, I would say that probably.

Nathan Latka

30:01Guys, vizypay.com is system that rural small businesses are using. They are powered by Clover. He just spent a million bucks buying additional Clover hardware to get installed. He's got over 13,000 signed customers, tens of thousand installed POS systems. They did 1,850,000,000 in transaction volume last year, representing 35,000,000 transactions. They did about, call it 22, $23,000,000 of total sorry, 22 yeah. About $22,000,000 of total revenue, hoping to hit, call it 25,000,000 this year. He's got 95 full

30:33time folks on the team and his go to market is a very unique combination of ten ninety nine contractors that can keep and build 50% residual revenue streams for selling the vizypay product in their local communities. And also he's now the big bet they're making is how can they get w two full time employees performing in a unit economic positive way? He uses local bank to fund $1,500,000 of debt to keep growing the business because he

30:52has bootstrapped the entire thing. Imagine owning a 100% or close to a 100% of a 25,000,000 business. Austin has done it. He's staying patient, building it the right way. Austin, thank you for taking us to the top.

Austin Mac Nab

31:03>> Thanks for having having me, Nathan. I appreciate it, buddy.