AvidXchange

AvidXchange Holdings ($AVDX): The company is a provider of solutions for automation of settlements with suppliers and payments for the middle market. AvidXchange software and payment platform digitized and automated payables workflows for more than 7,000 businesses and processed about 53 million transactions in 2020 worth more than $145 billion. In the period from 2015 to 2020, the company processed more than 700,000 payments for suppliers.

The company represents a unique strategic platform for financial directors, treasurers and financial departments of clients, digitally changing the ways of receiving, managing and paying bills. Supported by deep integration into an accounting system focused on the middle customer market and information systems, the platform automates AP workflows for buyers and increases the convenience of payment for suppliers through the following products and features:

AP Automation Software: Developed a SaaS-based solution that automates and digitizes the collection, review, approval and payment of invoices for buyers. The multichannel data reception mechanism provides unique, vertical-oriented interface software tools that optimize access point workflows for customers. Digitally capture invoices from suppliers and apply certain buyer business rules to allow them to start invoice processing, extract and use transaction data from the invoice to improve and customize approval workflows and manage the entire AP process through invoice payment.

AvidPay Network: A two-way payment network connects buyers with their suppliers, allowing them to pay bills on behalf of the buyer and in accordance with the supplier's business rules, payment preferences and money transfer data. The company supports various payment methods depending on the supplier's preferences, including a virtual commercial card or VCC, an extended ACH (our AvidPay Direct) and a physical receipt, while providing detailed data on money transfers to simplify the reconciliation process.

Cash Flow Manager: The company provides cash management solutions to a network of suppliers, including tools that provide a complete presentation of invoices and an accelerator function (our Invoice Accelerator). These additional features, as well as others in the product, allow the company to both monetize and increase engagement in two-way payment networks.

The company does not have a significant concentration of clients in the business: none of the clients brought in more than 6% of revenue in 2020, and the 10 largest clients brought in less than 15% of revenue in 2020, as well as in the first six months of 2020 and 2021. The company's clients work in various fields, including real estate, homeowners' associations or HOAs, construction, financial services (including banks and credit unions), medical institutions, social services, education and the media.

AvidPay's two-way network of buyers and suppliers is a powerful flywheel. The company believes that by providing world-class AP automation experience, they attract more buyers and increase the number of transactions processed through the system. The company also uses direct connections with our supplier network to increase the penetration of electronic payments, which attracts more suppliers to the network. More data about these additional transactions and electronic payments is collected and used to continuously improve the AP automation experience, attracting more buyers, suppliers and, as a result, more transactions to the platform.

The company's platform was specially created for the middle market. Intuitive user interfaces are the entry point to a broader user interface emphasizing visibility and control. The SaaS-based technical substrate promotes digital transformation and provides scalability for growth with customers. A number of innovative solutions for users, giving them access to advanced features needed to transform their AP processes. In addition to horizontal offerings, the company has a number of sophisticated vertical software offerings including AvidInvoice, AvidBuy, AvidPay, AvidUtility, BankTEL Ascend, Avid for NetSuite, Strongroom Payables Lockbox, Timberscan and Titanium among other offerings.

Competitive advantages:

Created to solve unique business problems of the middle market: since its creation, the solution has been specially designed for the middle market. The platform solves corporate-level tasks, but at scale, price and in the language of the middle market.

Digitization of the entire access point workflow: Automation of SaaS-based data and software for the entire access point workflow. While some tools require the buyer to first process receipt of invoices, we focus on transforming the buyer's experience by owning and improving every point of the value chain. The platform will process the receipt of invoices, whether paper or electronic, and reproduce this ownership and automation prior to payment.

A comprehensive platform for end-to-end automation of access to access points and payments: a comprehensive solution provides a unified approach to eliminate paper documents, optimize workflows and ensure timely and accurate reconciliation, hundreds of integrations with accounting and information systems for medium-sized businesses focused on specific verticals.

A scalable two-way network of buyers and suppliers creates a flywheel effect: the company provides a layer of infrastructure connecting buyers with their suppliers. As buyers approve and pay more bills through the platform, the company connects them with their suppliers and adds new suppliers to the network, which contributes to the expansion of the flywheel effect that promotes growth.

A diverse and deep level of integration: 210 integrations with various accounting systems that allow customers to form a stack of technologies taking into account the nuances of their size, scale and vertical.

Unprecedented data processing capabilities: Buyers and suppliers benefit from over 190 million invoices that have been received and processed since inception.

Typical workflows: