Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 22, 2024 | Jun. 30, 2023 | |
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
ICFR Auditor Attestation Flag | true | ||
Entity Registrant Name | Repay Holdings Corporation | ||
Entity Central Index Key | 0001720592 | ||
Entity Tax Identification Number | 98-1496050 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity File Number | 001-38531 | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Address, Address Line One | 3 West Paces Ferry Road | ||
Entity Address, Address Line Two | Suite 200 | ||
Entity Address, Postal Zip Code | 30305 | ||
City Area Code | 404 | ||
Local Phone Number | 504-7472 | ||
Entity Public Float | $ 696,574,746 | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Incorporation, State or Country Code | DE | ||
Trading Symbol | RPAY | ||
Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | ||
Security Exchange Name | NASDAQ | ||
Entity Address, State or Province | GA | ||
Entity Address, City or Town | Atlanta | ||
Auditor Name | Grant Thornton LLP | ||
Auditor Firm ID | 248 | ||
Auditor Location | Atlanta, Georgia | ||
Documents Incorporated by Reference | The registrant has incorporated by reference into Part III of this report certain portions of either an amendment to this Form 10-K or its proxy statement for its 2024 Annual Meeting of Shareholders, which are expected to be filed within 120 days after the end of the registrant’s fiscal year ended December 31, 2023. | ||
Class A Common Stock | |||
Entity Common Stock, Shares Outstanding | 96,160,465 | ||
Class V Common Stock | |||
Entity Common Stock, Shares Outstanding | 100 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Cash and cash equivalents | $ 118,096 | $ 64,895 |
Accounts receivable | 36,017 | 33,544 |
Prepaid expenses and other | 15,209 | 18,213 |
Total current assets | 169,322 | 116,652 |
Property, plant and equipment, net | 3,133 | 4,375 |
Restricted cash | 26,049 | 28,668 |
Intangible assets, net | 447,141 | 500,575 |
Goodwill | 716,793 | 827,813 |
Operating lease right-of-use assets, net | 8,023 | 9,847 |
Deferred tax assets | 146,872 | 136,370 |
Other assets | 2,500 | 2,500 |
Total noncurrent assets | 1,350,511 | 1,510,148 |
Total assets | 1,519,833 | 1,626,800 |
Liabilities | ||
Accounts payable | 22,030 | 21,781 |
Related party payable | 1,000 | |
Accrued expenses | 32,906 | 29,016 |
Current operating lease liabilities | 1,629 | 2,263 |
Current tax receivable agreement | 580 | 24,454 |
Other current liabilities | 318 | 3,593 |
Total current liabilities | 57,463 | 82,107 |
Long-term debt | 434,166 | 451,319 |
Noncurrent operating lease liabilities | 7,247 | 8,295 |
Tax receivable agreement, net of current portion | 188,331 | 154,673 |
Other liabilities | 1,838 | 2,113 |
Total noncurrent liabilities | 631,582 | 616,400 |
Total liabilities | 689,045 | 698,507 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity | ||
Treasury stock, 1,416,510 and 1,078,141 shares as of December 31, 2023 and December 31, 2022, respectively | (12,528) | (10,000) |
Additional paid-in capital | 1,151,327 | 1,117,736 |
Accumulated other comprehensive loss | (3) | (3) |
Accumulated deficit | (323,670) | (213,180) |
Total Repay stockholders' equity | 815,135 | 894,562 |
Non-controlling interests | 15,653 | 33,731 |
Total equity | 830,788 | 928,293 |
Total liabilities and equity | 1,519,833 | 1,626,800 |
Class A Common Stock | ||
Stockholders' equity | ||
Common stock value | $ 9 | $ 9 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Treasury Stock, Shares | 1,416,510 | 1,078,141 |
Class A Common Stock | ||
Common shares, par value | $ 0.0001 | $ 0.0001 |
Common shares, shares authorized | 2,000,000,000 | 2,000,000,000 |
Common shares, shares issued | 92,220,494 | 89,354,754 |
Common shares, shares outstanding | 90,803,984 | 88,276,613 |
Class V Common Stock | ||
Common shares, par value | $ 0.0001 | $ 0.0001 |
Common shares, shares authorized | 1,000 | 1,000 |
Common shares, shares issued | 100 | 100 |
Common shares, shares outstanding | 100 | 100 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | |||
Revenue | $ 296,627 | $ 279,227 | $ 219,258 |
Operating Expenses | |||
Costs of services (exclusive of depreciation and amortization shown separately below) | 69,703 | 64,826 | 55,484 |
Selling, general and administrative | 148,653 | 149,061 | 120,053 |
Depreciation and amortization | 103,857 | 107,751 | 89,692 |
Change in fair value of contingent consideration | (3,300) | 5,846 | |
Loss on business disposition | 10,027 | ||
Impairment loss | 75,800 | 8,090 | 2,180 |
Total operating expenses | 408,040 | 326,428 | 273,255 |
Loss from operations | (111,413) | (47,201) | (53,997) |
Other income (expense) | |||
Interest (expense) income, net | (1,048) | (4,245) | (3,599) |
Loss on extinguishment of debt | (5,941) | ||
Change in fair value of tax receivable liability | (6,619) | 66,871 | (14,109) |
Other (loss) income | (455) | (510) | (9,082) |
Total other income (expense) | (8,122) | 62,116 | (32,731) |
Income (loss) before income tax benefit (expense) | (119,535) | 14,915 | (86,728) |
Income tax benefit (expense) | 2,115 | (6,174) | 30,691 |
Net income (loss) | (117,420) | 8,741 | (56,037) |
Less: Net loss attributable to non-controlling interests | (6,930) | (4,095) | (5,953) |
Net income (loss) attributable to the Company | $ (110,490) | $ 12,836 | $ (50,084) |
Income (loss) per Class A share attributable to the Company: | |||
Basic | $ (1.23) | $ 0.14 | $ (0.6) |
Diluted | $ (1.23) | $ 0.12 | $ (0.6) |
Weighted-average shares outstanding: | |||
Basic | 90,048,638 | 88,792,453 | 83,318,189 |
Diluted | 90,048,638 | 110,671,731 | 83,318,189 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (117,420) | $ 8,741 | $ (56,037) |
Other comprehensive (loss) income, before tax | |||
Reclassification of net unrealized loss on cash flow hedges to other loss | 9,317 | ||
Foreign currency translation adjustments | (2) | (3) | |
Total other comprehensive (loss) income, before tax | (2) | 9,314 | |
Income tax related to items of other comprehensive income: | |||
Tax expense on reclassification of net unrealized loss on cash flow hedges to other loss | (1,673) | ||
Tax benefit on foreign currency translation adjustments | 1 | 1 | |
Total income tax benefit (expense) related to items of other comprehensive income | 1 | (1,672) | |
Total other comprehensive income (loss), net of tax | (1) | 7,642 | |
Total comprehensive income (loss) | (117,420) | 8,740 | (48,395) |
Less: Comprehensive loss attributable to non-controlling interests | (6,930) | (4,095) | (4,745) |
Comprehensive income (loss) attributable to the Company | $ (110,490) | $ 12,835 | $ (43,650) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Common Stock Class A Common Stock | Common Stock Class V Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest |
Balance at Dec. 31, 2020 | $ 556,182 | $ 7 | $ 691,675 | $ (175,932) | $ (6,437) | $ 46,869 | ||
Balance, shares at Dec. 31, 2020 | 71,244,682 | 100 | ||||||
Issuance of new shares | 370,348 | $ 2 | 371,048 | (702) | ||||
Issuance of new shares, shares | 16,295,802 | |||||||
Exchange of Post-Merger Repay Units | (2,498) | (166) | (2,332) | |||||
Exchange of Post-Merger Repay Units Shares | 407,584 | |||||||
Release of share awards vested under Incentive Plan, shares | 554,553 | |||||||
Shares repurchased under Incentive Plan | (4,042) | (4,075) | 33 | |||||
Stock-based compensation | 22,311 | 22,339 | (28) | |||||
Tax distribution from Hawk Parent | (62) | (62) | ||||||
Valuation allowance on Ceiling Rule DTA | 19,191 | 19,191 | ||||||
Net income (loss) | (56,037) | (50,084) | (5,953) | |||||
Other comprehensive income (loss) | 7,643 | 6,435 | 1,208 | |||||
Balance at Dec. 31, 2021 | 913,036 | $ 9 | 1,100,012 | (226,016) | (2) | 39,033 | ||
Balance, shares at Dec. 31, 2021 | 88,502,621 | 100 | ||||||
Exchange of Post-Merger Repay Units | 243 | (243) | ||||||
Exchange of Post-Merger Repay Units Shares | 50,845 | |||||||
Release of share awards vested under Incentive Plan and shares purchased under ESPP, shares | 1,031,737 | |||||||
Shares Repurchased Under Incentive Plan and ESPP | (2,657) | (2,658) | 1 | |||||
Shares repurchased under incentive Plan and ESPP , Shares | (230,449) | |||||||
Treasury shares repurchased | (10,000) | (32) | $ (10,000) | 32 | ||||
Treasury shares repurchased, shares | (1,078,141) | |||||||
Stock-based compensation | 20,256 | 20,302 | (46) | |||||
Tax distribution from Hawk Parent | (951) | (951) | ||||||
Valuation allowance on Ceiling Rule DTA | (131) | (131) | ||||||
Net income (loss) | 8,741 | 12,836 | (4,095) | |||||
Other comprehensive income (loss) | (1) | (1) | ||||||
Balance at Dec. 31, 2022 | 928,293 | $ 9 | 1,117,736 | (10,000) | (213,180) | (3) | 33,731 | |
Balance, shares at Dec. 31, 2022 | 88,276,613 | 100 | ||||||
Exchange of Post-Merger Repay Units | 7,557 | (7,557) | ||||||
Exchange of Post-Merger Repay Units Shares | 2,031,636 | |||||||
Release of share awards vested under Incentive Plan, shares | 1,084,532 | |||||||
Release of share awards vested under Incentive Plan and shares purchased under ESPP | 1,960 | 1,963 | (3) | |||||
Shares Repurchased Under Incentive Plan and ESPP | (1,891) | (1,905) | 14 | |||||
Shares repurchased under incentive Plan and ESPP , Shares | (250,428) | |||||||
Treasury shares repurchased | (2,528) | (3) | (2,528) | 3 | ||||
Treasury shares repurchased, shares | (338,369) | |||||||
Stock-based compensation | 22,156 | 22,236 | (80) | |||||
Tax distribution from Hawk Parent | (3,525) | (3,525) | ||||||
Valuation allowance on Ceiling Rule DTA | 3,743 | 3,743 | ||||||
Net income (loss) | (117,420) | (110,490) | (6,930) | |||||
Balance at Dec. 31, 2023 | $ 830,788 | $ 9 | $ 1,151,327 | $ (12,528) | $ (323,670) | $ (3) | $ 15,653 | |
Balance, shares at Dec. 31, 2023 | 90,803,984 | 100 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | |||
Net income (loss) | $ (117,420) | $ 8,741 | $ (56,037) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 103,857 | 107,751 | 89,692 |
Stock based compensation | 22,156 | 20,255 | 22,311 |
Amortization of debt issuance costs | 2,847 | 2,834 | 2,536 |
Loss on business disposition | 10,027 | ||
Loss on extinguishment of debt | 5,941 | ||
Loss on sale of interest rate swaps | 9,316 | ||
Other loss | 238 | 245 | 19 |
Fair value change in tax receivable agreement liability | 6,619 | (66,871) | 14,109 |
Fair value change in contingent consideration | (3,300) | 5,846 | |
Impairment loss | 75,800 | 8,090 | 2,180 |
Payments of contingent consideration in excess of acquisition date fair value | (8,896) | (1,500) | |
Deferred tax expense (benefit) | (3,594) | 4,192 | (30,728) |
Change in accounts receivable | (3,986) | 696 | (6,518) |
Change in prepaid expenses and other | 2,936 | (5,786) | (3,801) |
Change in operating lease ROU assets | 1,328 | 653 | 2,013 |
Change in accounts payable | (189) | 1,698 | 4,771 |
Change in related party payable | (347) | 1,336 | |
Change in accrued expenses and other | 3,890 | 2,197 | 637 |
Change in operating lease liabilities | (1,388) | (523) | (1,323) |
Change in other liabilities | 493 | 2,594 | (7,470) |
Net cash provided by operating activities | 103,614 | 74,223 | 53,330 |
Cash flows from investing activities | |||
Purchases of property and equipment | (733) | (3,176) | (2,863) |
Purchases of intangible assets | (13,545) | (2,750) | |
Capitalized software development costs | (50,083) | (33,615) | (20,643) |
Purchases of equity investment | (2,500) | ||
Proceeds from sale of business, net of cash retained | 40,273 | ||
Net cash used in investing activities | (24,088) | (39,541) | (397,335) |
Cash flows from financing activities | |||
Issuance of long-term debt | 460,000 | ||
Payments on long-term debt | (20,000) | (262,654) | |
Shares repurchased under Incentive Plan and ESPP | (1,891) | (2,657) | (4,042) |
Treasury shares repurchased | (2,528) | (10,000) | |
Distributions to Members | (3,525) | (951) | (62) |
Payment of loan costs | (14,051) | ||
Payments of contingent consideration up to acquisition date fair value | (1,000) | (3,851) | (7,449) |
Net cash (used in) provided by financing activities | (28,944) | (17,459) | 313,840 |
Increase (decrease) in cash, cash equivalents and restricted cash | 50,582 | 17,223 | (30,165) |
Cash, cash equivalents and restricted cash at beginning of period | 93,563 | 76,340 | 106,505 |
Cash, cash equivalents and restricted cash at end of period | 144,145 | 93,563 | 76,340 |
Cash paid during the year for: | |||
Interest | 1,024 | 1,540 | 1,143 |
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||
Acquisition in exchange for Class A Common Stock | 228,250 | ||
Reconciliation of cash, cash equivalents and restricted cash in the Consolidated Balance Sheets to the amounts shown in the Consolidated Statements of Cash Flows: | |||
Cash and cash equivalents | 118,096 | 64,895 | 50,049 |
Restricted cash | 26,049 | 28,668 | 26,291 |
Total cash, cash equivalents and restricted cash as shown in the Consolidated Statements of Cash Flows | $ 144,145 | $ 93,563 | 76,340 |
Class A Common Stock | |||
Cash flows from financing activities | |||
Public issuance of Class A Common Stock | 142,098 | ||
CPS | |||
Cash flows from investing activities | |||
Acquisition, net of cash and restricted cash acquired | 11 | ||
Billing Tree | |||
Cash flows from investing activities | |||
Acquisition, net of cash and restricted cash acquired | (269,003) | ||
Kontrol | |||
Cash flows from investing activities | |||
Acquisition, net of cash and restricted cash acquired | (7,439) | ||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||
Acquisition in exchange for contingent consideration | 500 | ||
Payix | |||
Cash flows from investing activities | |||
Acquisition, net of cash and restricted cash acquired | (94,898) | ||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||
Acquisition in exchange for contingent consideration | $ 2,850 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ (110,490) | $ 12,836 | $ (50,084) |
Insider Trading Arrangements
Insider Trading Arrangements - Directors or Officers | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Organizational Structure and Co
Organizational Structure and Corporate Information | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Organizational Structure and Corporate Information | 1 . Organizational Structure and Corporate Information Repay Holdings Corporation was incorporated as a Delaware corporation on July 11, 2019 in connection with the closing of a transaction (the “Business Combination”) pursuant to which Thunder Bridge Acquisition Ltd., a special purpose acquisition company organized under the laws of the Cayman Islands (“Thunder Bridge”), (a) domesticated into a Delaware corporation and changed its name to “Repay Holdings Corporation” and (b) consummated the merger of a wholly owned subsidiary of Thunder Bridge with and into Hawk Parent Holdings, LLC, a Delaware limited liability company (“Hawk Parent”). Throughout this section, unless otherwise noted or unless the context otherwise requires, the terms “we”, “us”, “Repay” and the “Company” and similar references refer (1) before the Business Combination, to Hawk Parent and its consolidated subsidiaries and (2) from and after the Business Combination, to Repay Holdings Corporation and its consolidated subsidiaries. Throughout this section, unless otherwise noted or unless the context otherwise requires, “Thunder Bridge” refers to Thunder Bridge Acquisition. Ltd. prior to the consummation of the Business Combination. The Company is headquartered in Atlanta, Georgia. The Company’s legacy business was founded as M & A Ventures, LLC, a Georgia limited liability company doing business as REPAY: Realtime Electronic Payments (“REPAY LLC”), in 2006 by current executives John Morris and Shaler Alias. Hawk Parent was formed in 2016 in connection with the acquisition of a majority interest in the successor entity of REPAY LLC and its subsidiaries by certain investment funds sponsored by, or affiliated with, Corsair Capital LLC (“Corsair”). Business Overview The Company provides integrated payment processing solutions to industry-oriented markets in which businesses have specific transaction processing needs. The Company refers to these markets as “vertical markets” or “verticals.” The Company’s proprietary, integrated payment technology platforms reduce the complexity of the electronic payments process for businesses. The Company charges its clients processing fees based on the volume of payment transactions processed and other transaction or service fees. The Company intends to continue to strategically target verticals where the Company believes its ability to tailor payment solutions to its clients’ needs, its deep knowledge of the Company’s vertical markets and the embedded nature of its integrated payment solutions will drive strong growth by attracting new clients and fostering long-term client relationships. The Company provides payment processing solutions to clients primarily operating in the personal loans, automotive loans, receivables management, and business-to-business verticals. The Company’s payment processing solutions enable consumers and businesses in these verticals to make payments using electronic payment methods, rather than cash or check, which have historically been the primary methods of payment in these verticals. The Company believes that a growing number of consumers and businesses prefer the convenience and efficiency of paying with cards and other electronic methods and that the Company is poised to benefit from the significant growth opportunity of electronic payment processing as these verticals continue to shift from cash and check to electronic payments. The personal loans vertical is predominately characterized by installment loans, which are typically utilized by consumers to finance everyday expenses. The automotive loans vertical includes a diversified client base across the entire credit spectrum. The Company’s receivables management vertical relates to consumer loan collections, which typically enter the receivables management process due to delinquency on credit card bills or as a result of major life events, such as job loss or major medical issues. The business-to-business vertical relates to transactions occurring between a wide variety of enterprise clients, many of which operate in the automotive, field services, healthcare, HOA management and hospitality industries, as well as educational institutions and governments and municipalities. The Company’s go-to-market strategy combines direct sales with integrations with key software providers in its target verticals. The integration of the Company’s technology with key software providers in the verticals that the Company serves, including loan management systems, DMS, collection management systems, and enterprise resource planning software systems, allows the Company to embed its omni-channel payment processing technology into its clients’ critical workflow software and ensure seamless operation of the Company’s solutions within its clients’ enterprise management systems. The Company refers to these software providers as its “software integration partners.” This integration allows the Company’s sales force to readily access new client opportunities or respond to inbound leads because, in many cases, a business will prefer, or in some cases only consider, a payments provider that has already integrated or is able to integrate its solutions with the business’ primary enterprise management system. The Company has successfully integrated its technology solutions with numerous, widely-used enterprise management systems in the verticals that it serves, which makes its platform a more compelling choice for the businesses that use them. Moreover, the Company’s relationships with its software integration partners help it to develop deep industry knowledge regarding trends in client needs. The Company’s integrated model fosters long-term relationships with its clients, which supports its volume retention rates that the Company believes are above industry averages. As of December 31, 2023, the Company maintained approximately 262 integrations with various software providers. The Company has two reportable segments: Consumer Payments and Business Payments. For additional information on segments, see Note 15. Segments to our consolidated financial statements. Consumer Payments The Consumer Payments segment provides payment processing solutions (including debit and credit card processing, ACH processing and other electronic payment acceptance solutions, as well as our loan disbursement product) that enable the Company’s clients to collect payments and disburse funds to consumers and includes the Company’s clearing and settlement solutions (“RCS”) offering. RCS is the Company’s proprietary clearing and settlement platform through which the Company markets customizable payment processing programs to other Independent Sales Organizations (“ISOs”) and payment facilitators. The Consumer Payments segment previously included the Blue Cow Software business (“BCS”), which was sold for $ 41.9 million in cash on February 15, 2023. The strategic vertical markets served by the Consumer Payments segment primarily include personal loans, automotive loans, receivables management, credit unions, mortgage servicing, consumer healthcare and diversified retail. The Consumer Payments segment represented approximatel y 87 % of the Company’s total revenue after any intersegment eliminations for the year ended December 31, 2023. Business Payments The Business Payments segment provides payment processing solutions (including accounts payable automation, debit and credit card processing, virtual credit card processing, ACH processing and other electronic payment acceptance solutions) that enable the Company’s clients to collect or send payments to other businesses. The strategic vertical markets served within the Business Payments segment primarily include retail automotive, education, field services, governments and municipalities, healthcare, HOA management and hospitality. The Business Payments segment represented approximatel y 13 % of the Company’s total revenue after any intersegment eliminations for the year ended December 31, 2023. On February 15, 2023, the Company sold Blue Cow Software, LLC and a related entity (“BCS”) for cash proceeds of $ 41.9 million. The Company recognized a loss of $ 10.0 million associated with the sale, comprised of the difference between the consideration received and the net carrying amount of the assets and liabilities of the business. See Note 5. Business Combinations and Dispositions for further discussion. In December 2023, the Company completed a $ 13.6 million intangible assets purchase with a third-party distribution partner, which includes its certain proprietary customer relationships and related contingent and uncertain future payment streams. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of Repay Holdings Corporation and its majority-owned subsidiary, Hawk Parent Holdings LLC, along with Hawk Parent Holdings LLC’s wholly owned subsidiaries: Hawk Intermediate Holdings, LLC, Hawk Buyer Holdings, LLC, Repay Holdings, LLC, M&A Ventures, LLC, Repay Management Holdco Inc., Repay Management Services LLC, Sigma Acquisition, LLC, Wildcat Acquisition, LLC, Marlin Acquirer, LLC, REPAY International LLC, REPAY Canada Solutions ULC, TriSource Solutions, LLC (“TriSource”), Mesa Acquirer, LLC, CDT Technologies LTD (“Ventanex”), Viking GP Holdings, LLC, cPayPlus, LLC (“cPayPlus”), CPS Payment Services, LLC, Media Payments, LLC (“Media Payments”), Custom Payment Systems, LLC, Electronic Payment Providers, LLC, Internet Payment Exchange, LLC, Stratus Payment Solutions, LLC, Clear Payment Solutions, LLC, Harbor Acquisition LLC, Payix Holdings Incorporated and Payix Incorporated. All significant intercompany accounts and transactions have been eliminated in consolidation. Basis of Financial Statement Presentation The accompanying consolidated financial statements of the Company were prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The Company uses the accrual basis of accounting whereby revenues are recognized when earned, usually upon the date services are rendered, and expenses are recognized at the date services are rendered or goods are received. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported consolidated statements of operations during the reporting period. Actual results could differ materially from those estimates. Segment Reporting The Company reports operating results through two reportable segments: (1) Consumer Payments and (2) Business Payments, as further discussed in Note 15. Segments. There are no significant concentrations by state or geographical location, nor are there any significant individual client concentrations by balance. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, demand deposit accounts, money market accounts and short‑term investments with original maturities of three months or less. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The amount of cash that the Company considers to be available for general purposes was $ 118.1 million and $ 64.9 million as of December 31, 2023 and 2022, respectively. As of December 31, 2023 , approximately 82 % of the Company’s total balance of cash and cash equivalents was held within a small group of financial institutions, primarily large money center banks. Although the Company currently believes that the financial institutions with whom the Company does business will be able to fulfill their commitments to the Company, there is no assurance that those institutions will be able to continue to do so. The Company has no t experienced any losses associated with the Company’s balances in such accounts for the years ended December 31, 2023 , 2022 or 2021. Restricted Cash Restricted cash primarily consists of (i) ACH settlement funds in transit (“Settlements”) and (ii) collateral reserve funds (“Reserves”). Settlements are held in accounts maintained at the Company’s sponsor banks for the purpose of facilitating the clearing and settlement of funds associated with payments made by or to the Company’s clients via the ACH network. The Company records a corresponding liability for Settlements within Accrued expenses in the Consolidated Balance Sheets. Reserves are held on deposit by the Company’s sponsor banks to secure potential merchant chargebacks or other similar losses or obligations. Accounts Receivable Accounts receivable represent amounts due from clients and payment processors for services rendered. The Company has an established process for aging, provisioning and writing-off its uncollectible accounts receivable. Within this process the Company aggregates accounts receivable to the pools of receivables of similar risk characteristics. The allowance for credit losses on accounts receivables is estimated based on how long a receivable has been outstanding (e.g., under 30 days, 30–60 days, etc.). For accounts receivable outstanding more than 90 days, the Company evaluates and assesses whether the loss reserve percentage requires adjustment for reasonable and supportable forecast of relevant economic factors. As of December 31, 2023 , the Company’s estimated credit losses on accounts receivable was immaterial. Concentration of Credit Risk The Company is highly diversified, and no single client represents greater than 10 % of the business on a volume or profit basis. The Company holds cash and cash equivalents with various major financial institutions. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. Earnings per Share Basic earnings per share of Class A common stock is computed by dividing net income (loss) attributable to the Company by the weighted average number of shares of Class A common stock outstanding during the period. Diluted earnings per share of Class A common stock is computed by dividing net income attributable to the Company, by the weighted average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive elements, including the assumed exchange of all limited liability company interests of Hawk Parent (“Post-Merger Repay Units”), unvested share-based awards, outstanding ESPP (“Employee Stock Purchase Program”) purchase rights and the Company’s Convertible Senior Notes due 2026 (“2026 Notes”). Property and Equipment Property and equipment is carried at cost less accumulated depreciation and includes expenditures which substantially increase the useful lives of existing property and equipment. Maintenance, repairs, and minor renovations are charged to operations as incurred. When property and equipment is retired or otherwise disposed of, the related costs and accumulated depreciation are removed from their respective accounts, and any gain or loss on the disposition is credited or charged to operations. The Company provides for depreciation of property and equipment using the straight-line method designed to amortize costs over estimated useful lives as follows: Estimated Useful Life Furniture, fixtures, and office equipment 5 years Computers 3 years Leasehold improvements Lesser of 5 years or lease term The Company evaluates the recoverability of property and equipment at least annually or whenever events or changes in circumstances indicate that the carrying amount of property and equipment may not be recoverable. The evaluation of asset impairment requires the Company to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from assumed and estimated amounts. If the carrying amount of property and equipment is determined not to be recoverable, a write-down to fair value is recorded. No impairments were recognized for the years ended December 31, 2023, 2022 and 2021 . Intangible Assets Intangible assets consist of internal-use software development costs, purchased software, channel relationships, client relationships, certain key personnel non-compete agreements, and trade names. The Company capitalizes internal-use software development costs when the Company has completed the preliminary project stage, management authorizes the project, management commits to funding the project, it is probable the project will be completed and the project will be used to perform the function intended. The Company is amortizing internal-use software development costs and purchased software on the straight‑line method over a three-year estimated useful life, a ten-year estimated useful life for channel and client relationships, and an estimated useful life for non-compete agreements equal to the term of the agreement. Trade names are determined to have an indefinite useful life. The Company evaluates the recoverability of intangible assets at least annually or whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. The evaluation of asset impairment requires the Company to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from assumed and estimated amounts. During the year ended December 31, 2023 , the Company recognized an impairment of $ 0.1 million related to a trade name write-off of Media Payments, as the Company strategically phased out the trade name of the acquired business. During the year ended December 31, 2022, the Company recognized impairments of $ 8.1 million related to write-offs of certain trade names, as the Company strategically phased out the trade names of several acquired business, which included BillingTree, Kontrol and Payix. During the year ended December 31, 2021, the Company recognized impairments of $ 2.2 million related to write-offs of certain trade names, as the Company strategically phased out the trade names of several acquired business, which included TriSource, APS, Ventanex, cPayPlus and CPS. Goodwill Goodwill represents the excess of purchase price over tangible and intangible assets acquired less liabilities assumed arising from business combinations. Goodwill is generally allocated to reporting units based upon relative fair value (taking into consideration other factors such as synergies) when an acquired business is integrated into multiple reporting units. The Company’s reporting units are at the operating segment level or one level below the operating segment level for which discrete financial information is prepared and regularly reviewed by management. When a business within a reporting unit is disposed of, goodwill is allocated to the disposed business using the relative fair value method. Relative fair value is estimated using a combination of a discounted cash flow (“DCF”) analysis and market valuation approach. The Company performs a qualitative goodwill assessment at the reporting unit level at least annually, or more frequently as events occur or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. Factors considered in the Company’s qualitative assessment include financial performance, financial forecasts, macroeconomic conditions, industry and market conditions, cost factors, market capitalization, carrying value, and events affecting the reporting units. If, after considering all relevant events and circumstances, the Company determines it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, then it is necessary to perform a quantitative impairment test. If the Company elects to bypass the qualitative analysis, or concludes from the Company’s qualitative analysis that it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, a quantitative impairment test is performed by comparing the fair value of each reporting unit with its carrying amount. If the fair value is greater than the carrying amount, then the reporting unit’s goodwill is deemed not to be impaired. If the fair value is less than the carrying amount, a non-cash impairment loss is recognized for the amount by which a reporting unit’s carrying amount exceeds its fair value, without exceeding the total amount of goodwill allocated to that reporting unit. Management estimates the fair value of the reporting units using a combination of a DCF calculation, which is a form of the income approach, and a market multiples calculation, which is a form of the market approach. The Company uses internal forecasts to estimate future cash flows expected to be generated by the reporting units when preparing DCF models under the income approach. To discount these cash flows, the Company uses an estimated weighted average cost of capital, which incorporates market and company-specific risk factors. The Company applies comparable publicly traded companies’ multiples (e.g., revenue or Adjusted EBITDA) to the Company’s reporting units’ financial forecasts when using market multiples under the market approach. During the Company’s annual goodwill impairment testing conducted on December 31, 2023, the Company concluded that goodwill associated with the Business Payments segment became impaired, as this reporting unit was primarily impacted by a change in the discount rate. The Company recognized an impairment loss of $ 75.7 million on goodwill related to the Business Payments segment within the Impairment loss in the Company’s Consolidated Statements of Operations. The goodwill impairment testing of the Business Payments segment is subject to assumptions and judgments management made as part of the assessment to estimate the fair value of the segment. The income approach required management assumptions, such as assumptions used in the cash flow forecasts, the discount rate, and the terminal value. The market approach required significant judgment in the selection of appropriate peer group companies and valuation multiples. Revenue Repay provides integrated payment processing solutions to niche markets that have specific transaction processing needs; for example, personal loans, automotive loans, and receivables management. The Company contracts with its clients through contractual agreements that set forth the general terms and conditions of the service relationship, including rights of obligations of each party, line item pricing, payment terms and contract duration. Most of our revenues are derived from volume-based payment processing fees (“discount fees”) and other related fixed per transaction fees. Discount fees represent a percentage of the dollar amount of each credit or debit transaction processed and include fees relating to processing and services that we provide. As our clients process increased volumes of payments, our revenues increase as a result of the fees we charge for processing these payments. The Company’s performance obligation in its contracts with clients is the promise to stand-ready to provide front-end authorization and back-end settlement payment processing services (“processing services”) for an unknown or unspecified quantity of transactions and the consideration received is contingent upon the client’s use (e.g., number of transactions submitted and processed) of the related processing services. Accordingly, the total transaction price is variable. These services are stand-ready obligations, as the timing and quantity of transactions to be processed is not determinable. Under a stand-ready obligation, the Company’s performance obligation is satisfied over time throughout the contract term rather than at a point in time. Because the service of standing ready to perform processing services is substantially the same each day and has the same pattern of transfer to the client, the Company has determined that its stand-ready performance obligation comprises a series of distinct days of service. Discount fees and other fixed per transaction fees are recognized each day using a time-elapsed output method based on the volume or transaction count at the time the clients’ transactions are processed. The Company has processing contracts that contain annual minimums to which the Company would be entitled to bill the shortfall between the actual processing revenue incurred during the annual period and the specified minimum in the contract. At the beginning of each annual period, the Company assesses the appropriate amount of the guaranteed minimums (either the fixed consideration or fixed consideration plus estimated overages) to recognize on a time-elapsed basis over the annual period. Revenues are also derived from transaction or service fees (e.g. chargebacks, gateway) as well as other miscellaneous service fees. These services are considered immaterial in the overall context of our contractual arrangements and, as such, do not represent distinct performance obligations. Instead, the fees associated with these services are bundled with the processing services performance obligation identified. The transaction price for such processing services is determined, based on the judgment of the Company’s management, considering factors such as margin objectives, pricing practices and controls, client segment pricing strategies, the product life cycle and the observable price of the service charged to similarly situated clients. The Company follows the requirements of ASC 606-10-55-36 through -40, Revenue from Contracts with Customers, Principal Agent Considerations , in determining the gross versus net revenue presentation for each performance obligation in the contract with a client. Revenue recorded by the Company in the capacity as a principal is reported on a gross basis equal to the full amount of consideration to which the Company expects in exchange for the good or service transferred. Revenue recorded with the Company acting in the capacity of an agent is reported on a net basis, exclusive of any consideration provided to the principal party in the transaction. The principal versus agent evaluation is matter of judgment that depends on the facts and circumstances of the arrangement and is dependent on whether the Company controls the good or service before it is transferred to the client or whether the Company is acting as an agent of a third party. This evaluation is performed separately for each performance obligation identified. When the Company acts as an agent, the fees collected from clients on behalf of the payment networks and card issuer is netted with the gross fees collected so that the net revenue is presented within Revenue in the Consolidated Statements of Operations. Indirect relationships As a result of its past acquisitions, the Company has legacy relationships with ISOs, whereby the Company acts as the merchant acquirer for the ISO. The ISO maintains a direct relationship with the sponsor bank and the transaction processor, rather than the Company. Consequently, the Company recognizes revenue for these relationships net of the residual amount remitted to the ISO, based on the fact that the ISO is primarily responsible for providing the transaction processing services to the merchant. The Company is not focused on this sales model, and this relationship will represent an increasingly smaller portion of the business over time. Contract Costs The incremental costs of obtaining a contract are recognized as an asset if the cost is incremental to obtaining a contract, and whether the costs are recoverable from the client. If both criteria are not met, costs are expensed as incurred. If the amortization period of the capitalized commission cost asset is less than one year, the Company may elect a practical expedient per ASC 340-40-25-4 to expense commissions as incurred. The amortization period is consistent with the concept of useful life under other accounting guidance, which is defined as the period over which an asset is expected to contribute directly or indirectly to future cash flows. The Company currently incurs costs to obtain a contract through payments made to external referral partners. Commission payments are made to the external referral partner on a monthly basis based on a percentage of the profit on the contract, for as long as the client and the external referral partner have agreements with the Company. Any capitalized commission cost assets have an amortization period of one year or less, therefore the Company utilizes the practical expedient to expense commissions as incurred. Costs to fulfill contracts with clients either give rise to an asset or are expensed as incurred. If the cost is not already covered by other applicable accounting literature, fulfillment costs are capitalized to the extent they directly relate to a specific contract, are used to generate or enhance resources used in satisfying performance obligations and are expected to be recovered. The Company does not have any costs incurred to fulfill a contract. Practical Expedients The Company has utilized the portfolio approach practical expedient per ASC 606-10-10-4, which allows the application of ASC 606 to a portfolio of contracts with similar characteristics provided the accounting does not differ materially to application of ASC 606 to the individual contract. The Company has also utilized the practical expedient for immaterial goods and services per ASC 606-10-25-16A, which permits the Company not to recognize a promised good or service as a performance obligation if it is considered an immaterial promise in the context of the contract. Transaction Costs The Company expenses all transaction costs associated with a business combination as incurred and such expenses are included in Selling, general, and administrative expenses in the Consolidated Statements of Operations. For the years ended December 31, 2023, 2022 and 2021 , the Company incurred $ 3.4 million, $ 13.7 million and $ 9.3 million transaction costs, respectively. Equity Units Awarded The Repay Holdings Corporation 2019 Omnibus Incentive Plan (as amended, the “Incentive Plan”) provides for the grant of various equity-based incentive awards to employees, directors, consultants and advisors to the Company. The types of equity-based awards that may be granted under the Incentive Plan include: stock appreciation rights (“SARs”), performance stock units (“PSUs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance-based stock options (“PSOs”) and other stock-based awards. As of December 31, 2023 , there were 2,137,122 shares of Class A common stock available for future issuance under the Incentive Plan. The Company accounts for stock-based compensation for employees and directors in accordance with ASC 718, Compensation (“ASC 718”). ASC 718 requires all share-based payments to employees to be recognized in the statement of operations based on their fair values. Under the provisions of ASC 718, stock-based compensation costs are measured at the grant date, based on the fair value of the award, and are recognized as expense over the employee’s requisite or derived service period. PSUs, RSAs, RSUs and stock options granted under the Incentive Plan are measured based on the fair value of the awards on the date of the grant. Compensation expense is recognized for those awards over the requisite service period within Selling, general, and administrative in the Consolidated Statements of Operations. Forfeitures are accounted for as they occur. Debt Issuance Costs The Company accounts for debt issuance costs according to the Financial Accounting Standards Board Accounting Standards Update 2015-03, Simplifying the Presentation of Debt Issuance Costs , to present debt issuance costs as a reduction of the carrying amount of the debt. Fair Value of Financial Instruments The Company accounts for fair value measurements in accordance with ASC 820, Fair Value Measurements and Disclosures , which defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or the price paid to transfer a liability as of the measurement date. A three-tier, fair-value reporting hierarchy exists for disclosure of fair value measurements based on the observability of the inputs to the valuation of financial assets and liabilities. The three levels are: • Level 1 — Quoted prices for identical instruments in active markets. • Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in active exchange markets. The carrying value of the Company’s financial instruments, including cash and cash equivalents, restricted cash, accounts receivable and accounts payable approximated their fair values as of December 31, 2023 and 2022 , because of the relatively short maturity dates on these instruments. See Note 6. Fair Value of Assets and Liabilities for further discussion. Leases The Company evaluates each of its lease and service arrangements at inception to determine if the arrangement is, or contains, a lease and the appropriate classification of each identified lease. A lease exists if the Company obtains substantially all of the economic benefits of, and has the right to control the use of, an asset for a period of time. The Company has operating leases for real estate. Operating leases with an original lease term in excess of twelve months are included in Operating lease right-of-use assets, net, Current operating lease liabilities and Noncurrent operating lease liabilities in the Consolidated Balance Sheets. Right-of-use (“ROU”) assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate to calculate the present value of lease payments. Lease terms consider options to extend or terminate based on the determination of whether such renewal or termination options are deemed reasonably certain. Lease agreements that contain non-lease components are generally accounted for as a single lease component. Operating lease costs are recorded in Selling, general and administrative in the Consolidated Statements of Operations based on the underlying asset. Variable costs, such as maintenance expenses, property and sales taxes, association dues and index-based rate increases, are expensed as they are incurred. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented as operating expenses in Selling, general and administrative in the Consolidated Statements of Operations. The Company has elected not to recognize ROU assets and lease liabilities for short-term leases of all applicable class of underlying assets that have a lease term of twelve months or less. The Company recognizes the lease payments associated with its short-term leases as an expense on a straight-line basis over the lease term. Variable lease payments associated with these leases are recognized and presented in the same manner as for all other Company leases. ROU assets for operating leases are periodically reduced by impairment losses. During the year ended December 31, 2023 , the Company recognized an impairment loss of $ 0.1 million related to the Consumer Payments segment when the Company entered an agreement with a third party to sublease one of the operating leases. The impairment loss was recorded within Other (loss) income in the Company's Consolidated Statements of Operations. The Company monitors for events or changes in circumstances that require a reassessment of a lease. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in gain or loss in the Consolidated Statements of Operations. Taxation Income taxes are provided for in accordance with ASC 740. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to net operating losses, tax credits, and temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period of the enactment date. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will not be realized. The Company reports a liability or a reduction of deferred tax assets for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. When applicable, the Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. Noncontrolling Interest As of December 31, 2023, 2022, and 2021 the Company held an interest o f 94.2 %, 92.0 %, and 91.9 % in Hawk Parent, respectively. For the years ended December 31, 2023, 2022, and 2021, the noncontrolling interest in the net loss of subsidiaries was $ 6.9 million , $ 4.1 million, and $ 6.0 million, respectively. Contingent Consideration The Company estimates and records the acquisition date estimated fair value of contingent consideration as part of purchase price consideration for acquisitions. Additionally, each reporting period, the Company estimates changes in the fair value of contingent consideration, and any change in fair value is recognized in the Consolidated Statements of Operations. An increase in the contingent consideration expected to be paid will result in a charge to operations in the period that the anticipated fair value of contingent consideration increases, while a decrease in the contingent consideration expected to be paid will result in a credit to operations in the period that the anticipated fair value of contingent consideration decreases. The estimate of the fair value of contingent consideration requires subjective assumptions to be made of future operating results, discount rates, and probabilities assigned to various potential operating result scenarios. Incurred But Not Reported ( “IBNR”) Reserve IBNR reserve includes the estimated liability related to the claims of the Company’s self-funded medical insurance policy for employees. The liability for these claims is based on the Company’s estimated ultimate cost of settling all claims. The Company derives estimates for the development of IBNR claims using actuarial methods that are based on many variables, including historical patterns of claims, cost trends, and other factors. At December 31, 2023 , the Company recognized $ 0.9 million of IBNR reserve recorded within Accrued expenses in the Consolidated Balance Sheets. Recently Adopted Accounting Pronouncements Reference Rate Reform In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, “ Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”)”, which provides optional expedients and exceptions to contracts, hedging relationships and other transactions affected by the transition away from LIBOR to alternative reference rates. In January 2021, the FASB issued ASU 2021-01, “ Reference Rate Reform (Topic 848): Scope ”, to expand the scope of this guidance to include derivatives. The guidance was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into on or before December 31, 2022. In December 2022, the FASB issued ASU 2022-06, “ Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 ”, which extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022, to December 31, 2024. The Company adopted these ASUs for the revolving credit facility as of February 9, 2023. Starting July 1, 2023, the Company applie |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 3. Revenue Disaggregation of Revenue The Company’s revenue is from two types of relationships: (i) direct relationships and (ii) indirect relationships. The following table presents the Company’s revenue disaggregated by segment and by the type of relationship for the years ended December 31, 2023, 2022, and 2021. Year Ended December 31, 2023 ($ in thousands) Consumer Payments Business Payments Elimination of intersegment revenues Total Revenue Direct relationships $ 263,564 $ 36,989 $ ( 17,139 ) $ 283,414 Indirect relationships 12,144 1,069 — 13,213 Total Revenue $ 275,708 $ 38,058 $ ( 17,139 ) $ 296,627 Year Ended December 31, 2022 ($ in thousands) Consumer Payments Business Payments Elimination of intersegment revenues Total Revenue Direct relationships $ 234,905 $ 41,610 $ ( 11,564 ) $ 264,951 Indirect relationships 13,286 990 — 14,276 Total Revenue $ 248,191 $ 42,600 $ ( 11,564 ) $ 279,227 Year Ended December 31, 2021 ($ in thousands) Consumer Payments Business Payments Elimination of intersegment revenues Total Revenue Direct relationships $ 189,019 $ 32,837 $ ( 8,604 ) $ 213,252 Indirect relationships 5,025 981 — 6,006 Total Revenue $ 194,044 $ 33,818 $ ( 8,604 ) $ 219,258 The contract asset balance was $ 1.4 million and $ 0.5 million as of December 31, 2023 and 2022 , respectively, and is included within Prepaid expenses and other in the Consolidated Balance Sheets. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 4. Earnings Per Share During the years ended December 31, 2023 and 2021, basic and diluted net income (loss) per common share is the same since the inclusion of the assumed exchange of all Post-Merger Repay Units, unvested share-based awards, outstanding stock options and 2026 Notes would have been anti-dilutive. The following table summarizes net income (loss) attributable to the Company and the weighted average basic and diluted shares outstanding: Year Ended December 31, ($ in thousands, except per share data) 2023 2022 2021 Income (loss) before income tax expense $ ( 119,535 ) $ 14,915 $ ( 86,728 ) Less: Net loss attributable to non-controlling interests ( 6,930 ) ( 4,095 ) ( 5,953 ) Income tax (expense) benefit 2,115 ( 6,174 ) 30,691 Net income (loss) attributable to the Company $ ( 110,490 ) $ 12,836 $ ( 50,084 ) Weighted average shares of Class A common stock outstanding - basic 90,048,638 88,792,453 83,318,189 Add weighted average effect of dilutive common stock equivalent shares: Post-Merger Repay Units exchangeable for Class A common stock 7,892,176 Unvested share-based awards of Class A common stock 890,309 Outstanding ESPP purchase rights for Class A common stock 1,554 2026 Notes convertible into Class A common stock 13,095,238 Weighted average shares of Class A common stock outstanding - diluted 90,048,638 110,671,731 83,318,189 Income (loss) per share of Class A common stock outstanding - basic $ ( 1.23 ) $ 0.14 $ ( 0.60 ) Income (loss) per share of Class A common stock outstanding - diluted $ ( 1.23 ) $ 0.12 $ ( 0.60 ) For the years ended December 31, 2023 and 2021, the following common stock equivalent shares were excluded from the computation of the diluted loss per share, since their inclusion would have been anti-dilutive: Year Ended December 31, 2023 2021 Post-Merger Repay Units exchangeable for Class A common stock 5,844,095 7,926,576 Unvested share-based awards of Class A common stock 5,204,540 2,515,634 Outstanding stock options for Class A common stock 1,148,822 — 2026 Notes convertible for Class A common stock 13,095,238 13,095,238 Share equivalents excluded from earnings (loss) per share 25,292,695 23,537,448 Shares of the Company’s Class V common stock do not participate in the earnings or losses of the Company and, therefore, are not participating securities. As such, separate presentation of basic and diluted earnings per share of Class V common stock under the two-class method has not been presented. Each share of the Company’s Class V common stock gives the holder the right to vote the number of shares corresponding to the number of Post-Merger Repay Units held by that holder, but shares of Class V common stock have no economic rights. |
Business Combinations and Dispo
Business Combinations and Dispositions | 12 Months Ended |
Dec. 31, 2023 | |
Business Combinations [Abstract] | |
Business Combinations and Dispositions | 5. Business Combinations and Dispositions Acquisitions BillingTree On June 15, 2021, the Company acquired BillingTree. Under the terms of the agreement and plan of merger between BT Intermediate, LLC, the Company, two newly formed subsidiaries of the Company and the owner of BT Intermediate, LLC (“BillingTree Merger Agreement”), the aggregate consideration paid at closing by the Company was approximately $ 505.8 million, consisting of approximately $ 277.5 million in cash and approximately 10 million shares of Class A common stock. The BillingTree Merger Agreement contains customary representations, warranties and covenants by Repay and the former owner of BillingTree, as well as a customary post-closing adjustment provision relating to working capital and similar items. The following summarizes the purchase consideration paid to the seller of BillingTree: ($ in thousands) Cash consideration $ 277,521 Class A common stock issued 228,250 Total purchase price $ 505,771 The Company recorded an allocation of the purchase price to BillingTree’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the June 15, 2021 closing date. The purchase price allocation is as follows: ($ in thousands) Cash and cash equivalents $ 8,244 Accounts receivable 4,627 Prepaid expenses and other current assets 1,602 Total current assets 14,473 Property, plant and equipment, net 541 Restricted cash 275 Other assets 1,782 Identifiable intangible assets 236,810 Total identifiable assets acquired 253,881 Accounts payable ( 2,552 ) Accrued expenses and other liabilities ( 6,983 ) Deferred tax liability ( 36,095 ) Net identifiable assets acquired 208,251 Goodwill 297,520 Total purchase price $ 505,771 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair Value Useful life Identifiable intangible assets (in millions) (in years) Non-compete agreements $ 0.3 2 Trade names 7.8 Indefinite Developed technology 26.2 3 Merchant relationships 202.5 10 $ 236.8 Goodwill recognized of $ 297.5 million represents the excess of the gross consideration transferred over the fair value of the underlying net tangible and identifiable intangible assets acquired, of which $ 66.5 million is expected to be deductible for tax purposes. Goodwill was allocated 100 % to the Company’s Consumer Payments segment. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets apart from goodwill. Intangible assets not recognized apart from goodwill consist primarily of the strong market position and the assembled workforce of BillingTree. Kontrol On June 22, 2021, the Company acquired substantially all of the assets of Kontrol LLC (“Kontrol”). Under the terms of the asset purchase agreement between a newly formed subsidiary of Repay Holdings, LLC and the owner of Kontrol (“Kontrol Purchase Agreement”), the aggregate consideration to be paid by the Company was up to $ 10.5 million, of which $ 7.4 million was paid at closing. The Kontrol Purchase Agreement contains customary representations, warranties and covenants by Repay and the former owner of Kontrol, as well as a customary post-closing adjustment provision relating to working capital and similar items. The following summarizes the purchase consideration paid to the owner of Kontrol: ($ in thousands) Cash consideration $ 7,439 Contingent consideration (1) 500 Total purchase price $ 7,939 (1) Reflects the fair value of the Kontrol earnout payment, the contingent consideration to be paid to the selling members of Kontrol, pursuant to the Kontrol Purchase Agreement as of June 22, 2021. The selling partners of Kontrol will have the contingent earnout right to receive a payment of up to $ 3.0 million, dependent upon the Gross Profit, as defined in the Kontr ol Purchase Agreement. As of December 31, 2022, the fair value of the Kontrol earnout was $ 0 , which resulted in a ($ 0.9 ) million a djustment included in the change in fair value of contingent consideration in the Consolidated Statements of Operations for the year ended December 31, 2022. The Company recorded an allocation of the purchase price to Kontrol’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the June 22, 2021 closing date. The purchase price allocation is as follows: ($ in thousands) Accounts receivable $ 68 Prepaid expenses and other current assets 6 Total current assets 74 Identifiable intangible assets 6,940 Total identifiable assets acquired 7,014 Accounts payable ( 665 ) Net identifiable assets acquired 6,349 Goodwill 1,590 Total purchase price $ 7,939 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair Value Useful life Identifiable intangible assets (in millions) (in years) Trade names $ 0.0 Indefinite Merchant relationships 6.9 8 $ 6.9 Goodwill of $ 1.6 million represents the excess of the gross consideration transferred over the fair value of the underlying net tangible and identifiable intangible assets acquired, of which $ 1.1 million on a gross basis is expected to be deductible for tax purposes. Goodwill was allocated 100 % to the Company’s Business Payments segment. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets apart from goodwill. Intangible assets not recognized apart from goodwill consist primarily of the strong market position and the assembled workforce of Kontrol. Payix On December 29, 2021, the Company acquired Payix. Under the terms of the merger agreement with Payix. (“Payix Purchase Agreement”), the aggregate consideration paid at closing by the Company was approximately $ 95.6 million in cash. In addition to the closing consideration, the Payix Purchase Agreement contains a performance-based earnout (the “Payix Earnout Payment”), which was based on future results of the acquired business and could result in an additional payment to the former owners of Payix of up to $ 20.0 million. The Payix acquisition was financed with cash on hand and available revolver capacity. The Payix Purchase Agreement contains customary representations, warranties and covenants by Repay and the former owners of Payix, as well as a customary post-closing adjustment provision relating to working capital and similar items. The following summarizes the purchase consideration paid to the sellers of Payix: ($ in thousands) Cash consideration $ 95,628 Contingent consideration (1) 2,850 Total purchase price $ 98,478 (1) Reflects the fair value of the Payix earnout payment, the contingent consideration to be paid to the former owners of Payix, pursuant to the Payix Purchase Agreement as of December 31, 2021. The former owners of Payix will have the contingent earnout right to receive a payment of up to $ 20.0 million, dependent upon the Gross Profit, as defined in the Payix Purchase Agreement. As of December 31, 2022, the fair value of the Payix earnout was $ 0 , which resulted in a ($ 2.9 ) million ad justment included in the change in fair value of contingent consideration in the Consolidated Statements of Operations for the year ended December 31, 2022. The Company recorded an allocation of the purchase price to Payix’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the December 29, 2021 closing date. The purchase price allocation is as follows: ($ in thousands) Cash and cash equivalents $ 703 Accounts receivable 1,715 Prepaid expenses and other current assets 94 Total current assets 2,512 Property, plant and equipment, net 83 Restricted cash 27 Other assets 656 Identifiable intangible assets 33,150 Total identifiable assets acquired 36,428 Accounts payable ( 214 ) Accrued expenses and other liabilities ( 2,023 ) Deferred tax liability ( 6,944 ) Net identifiable assets acquired 27,247 Goodwill 71,231 Total purchase price $ 98,478 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair Value Useful life Identifiable intangible assets (in millions) (in years) Trade names $ 0.3 Indefinite Developed technology 12.4 3 Merchant relationships 20.5 10 $ 33.2 Goodwill recognized of $ 71.2 million represents the excess of the gross consideration transferred over the fair value of the underlying net tangible and identifiable intangible assets acquired, no ne of which is expected to be deductible for tax purposes. Goodwill was allocated 100 % to the Company’s Consumer Payments segment. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets apart from goodwill. Intangible assets not recognized apart from goodwill consist primarily of the strong market position and the assembled workforce of Payix. Dispositions On February 15, 2023, the Company sold BCS within the Consumer Payments segment for cash proceeds of $ 41.9 million. During the year ended December 31, 2023 , the Company recognized a loss of $ 10.0 million associated with the sale, comprised of the difference between the consideration received and the net carrying amount of the assets and liabilities of the business within Loss on business disposition in the Company’s Condensed Consolidated Statement of Operations. In connection with the disposition of BCS, the Company recognized a reduction in goodwill of $ 35.3 million within the Consumer Payments segment. See Note 9. Goodwill for further discussion. For the years ended December 31, 2023 and 2022, BCS contributed $ 1.2 million an d $ 9.8 million to the Consumer Payments segment revenue, respectively. Pro Forma Financial Information (Unaudited) The supplemental consolidated results of the Company on an unaudited pro forma basis give effect to BillingTree, Kontrol and Payix acquisitions as if the transactions had occurred on January 1, 2021. The unaudited pro forma information reflects adjustments for the issuance of the Company’s common stock, debt incurred in connection with the transactions, the impact of the fair value of intangible assets acquired and related amortization and other adjustments the Company believes are reasonable for the pro forma presentation. In addition, the pro forma earnings exclude acquisition-related costs. ($ in thousands, except per share data) Pro Forma Year Ended December 31, 2021 Revenue $ 257,014 Net loss ( 54,627 ) Net loss attributable to non-controlling interests ( 5,813 ) Net loss attributable to the Company ( 48,814 ) Loss per Class A share - basic $ ( 0.56 ) Loss per Class A share - diluted $ ( 0.56 ) |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets and Liabilities | 6. Fair Value of Assets and Liabilities The following table summarizes, by level within the fair value hierarchy, the estimated fair values of our assets and liabilities measured at fair value on a recurring or nonrecurring basis or disclosed, but not carried, at fair value in the Consolidated Balance Sheets as of the dates presented. There were no transfers into, out of, or between levels within the fair value hierarchy during any of the periods presented. December 31, 2023 ($ in thousands) Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 118,096 $ — $ — $ 118,096 Other assets — 2,500 — 2,500 Total assets $ 118,096 $ 2,500 $ — $ 120,596 Liabilities: Contingent consideration $ — $ — $ — $ — Borrowings — 375,650 — 375,650 Tax receivable agreement — — 188,911 188,911 Total liabilities $ — $ 375,650 $ 188,911 $ 564,561 December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 64,895 $ — $ — $ 64,895 Other assets — 2,500 — 2,500 Total assets $ 64,895 $ 2,500 $ — $ 67,395 Liabilities: Contingent consideration $ — $ — $ 1,000 $ 1,000 Borrowings — 344,280 — 344,280 Tax receivable agreement — — 179,127 179,127 Total liabilities $ — $ 344,280 $ 180,127 $ 524,407 Cash and cash equivalents Cash and cash equivalents contains operating cash and money market funds. They are classified within Level 1 of the fair value hierarchy, as the price is obtained from quoted market prices in an active market. The carrying amounts of the Company’s cash and cash equivalents approximate their fair values due to the short maturities and highly liquid nature of these accounts. Other Assets Other assets contain a minority equity investment in a privately-held company. The Company elected a measurement alternative for measuring this investment, in which the carrying amount is adjusted based on any observable price changes in orderly transactions. The investment is classified as Level 2 as observable adjustments to value are infrequent and occur in an inactive market. Contingent Consideration Contingent consideration relates to potential payments that the Company may be required to make associated with acquisitions. The contingent consideration is recorded at fair value based on actuals or estimates of discounted future cash flows associated with the acquired businesses. To the extent that the valuation of these liabilities is based on inputs that are less observable or not observable in the market, the determination of fair value requires more judgment. Accordingly, the fair value of contingent consideration is classified within Level 3 of the fair value hierarchy, under ASC 820. The change in fair value is re-measured at each reporting period with the change in fair value being recognized in accordance with ASC 805, Business Combinations (“ASC 805”). As of December 31, 2022, the present value of contingent consideration reflects the actual anticipated payments. The following table provides a rollforward of the contingent consideration related to previous business acquisitions. Refer to Note 5. Business Combinations for more details. Year Ended December 31, ($ in thousands) 2023 2022 Balance at beginning of period $ 1,000 $ 17,047 Purchases — — Payments ( 1,000 ) ( 12,747 ) Valuation adjustment — ( 3,300 ) Balance at end of period $ — $ 1,000 Borrowings The revolving credit facility and 2026 Notes are measured at amortized cost, which the carrying value is unpaid principal net of unamortized debt discount and debt issuance costs. The estimated fair value of the revolving credit facility approximates the unpaid principal because its interest rate approximates market interest rates. The estimated fair value of the 2026 Notes is determined using the quoted prices from over-the-counter markets. The estimated fair value of the Company’s borrowings is classified within Level 2 of the fair value hierarchy, as the market interest rates and quoted prices are generally observable and do not contain a high level of subjectivity. The following table provides the carrying value and estimated fair value of borrowings. See Note 10. Borrowings for further discussion. December 31, 2023 December 31, 2022 ($ in thousands) Carrying value Fair value Carrying value Fair value Revolving credit facility $ — $ — $ 18,177 $ 20,000 2026 Notes 434,166 375,650 433,142 324,280 Total $ 434,166 $ 375,650 $ 451,319 $ 344,280 Tax Receivable Agreement Upon the completion of the Business Combination, the Company entered into the TRA with holders of Post-Merger Repay Units. As a result of the TRA, the Company established a liability in its consolidated financial statements. The TRA is recorded at fair value based on estimates of discounted future cash flows associated with the estimated payments to the Post-Merger Repay Unit holders. These inputs are not observable in the market; thus, the TRA is classified within Level 3 of the fair value hierarchy, under ASC 820. The change in fair value is re-measured at each reporting period with the change in fair value being recognized in accordance with ASC 805. The Company used a discount rate, also referred to as the early termination rate, to determine the present value, based on a risk-free rate plus a spread , pursuant to the TRA. A rate of 7.1 % w as applied to the forecasted TRA payments as of December 31, 2023, in order to determine the fair value. A significant increase or decrease in the discount rate could have r esulted in a lower or higher balance, respectively, as of the measurement date. The TRA balance was adjusted by $ 9.8 million t hrough exchanges of Post-Merger Repay Units, accretion expense and a valuation adjustment, related to an increase in the discount rate, which was 6.48 % as of December 31, 2022. The following table provides a rollforward of the TRA related to the Business Combination and subsequent exchanges of Post-Merger Repay Units. See Note 14. Taxation for further discussion on the TRA. Year Ended December 31, ($ in thousands) 2023 2022 2021 Balance at beginning of period $ 179,127 $ 245,828 $ 229,228 Purchases 3,164 170 2,491 Accretion expense 12,362 7,806 5,065 Valuation adjustment ( 5,742 ) ( 74,677 ) 9,044 Balance at end of period $ 188,911 $ 179,127 $ 245,828 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 7. Property and Equipment Property and equipment consisted of the following: December 31, December 31, ($ in thousands) 2023 2022 Furniture, fixtures, and office equipment $ 4,905 $ 4,014 Computers 4,813 4,889 Leasehold improvements 663 659 Total 10,381 9,562 Less: Accumulated depreciation and amortization 7,248 5,187 $ 3,133 $ 4,375 Depreciation expense for property and equipment was $ 2.4 million, $ 2.4 million and $ 1.3 million for the years ended December 31, 2023, 2022 and 2021 , respectively. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 8. Intangible Assets The Company holds definite and indefinite-lived intangible assets. As of December 31, 2023 , the indefinite-lived intangible assets consist of one trade name, arising from the acquisitions of Hawk Parent. As of December 31, 2022 , the indefinite-lived intangible assets consist of two trade names, arising from the acquisitions of Hawk Parent and Media Payments. During the year ended December 31, 2023 , the Company recognized an impairment of $ 0.1 million related to a trade name write-off of Media Payments related to the Business Payments segment. The impairment loss was recognized within Impairment loss in the Company’s Consolidated Statements of Operations. During the year ended December 31, 2022, the Company recorded an impairment loss of $ 8.1 million related to the write-offs of certain trade names, of which $ 8.1 million and $ 0.0 million of the impairment loss related to the Consumer Payments and Business Payments segments, respectively. The impairment loss was recognized within Impairment loss in the Company’s Consolidated Statements of Operations. During the year ended December 31, 2021, the Company recorded an impairment loss of $ 2.2 million related to the write-offs of certain trade names, of which $ 1.0 million and $ 1.2 million of the impairment loss related to the Consumer Payments and Business Payments segments, respectively. The impairment loss was recognized within Impairment loss in the Company’s Consolidated Statements of Operations. Intangible assets consisted of the following: ($ in thousands) Gross Carrying Value Accumulated Amortization Net Carrying Value Weighted Average Useful Life (Years) Client relationships $ 523,850 $ 190,591 $ 333,259 6.32 Channel relationships 29,785 4,792 24,993 8.39 Software costs 246,996 178,323 68,673 0.83 Non-compete agreements 4,580 4,364 216 0.23 Trade name 20,000 — 20,000 — Balance as of December 31, 2023 $ 825,211 $ 378,070 $ 447,141 4.68 Client relationships $ 539,850 $ 137,515 $ 402,335 7.40 Channel relationships 16,240 3,168 13,072 8.06 Software costs 196,890 132,322 64,568 0.99 Non-compete agreements 4,580 4,030 550 0.54 Trade name 20,050 — 20,050 — Balance as of December 31, 2022 $ 777,610 $ 277,035 $ 500,575 5.71 The Company’s amortization expense for intangible assets was $ 101.4 million, $ 105.4 million and $ 88.4 million for the years ended December 31, 2023, 2022 and 2021, respectively. The estimated amortization expense for the next five years and thereafter in the aggregate is as follows: ($ in thousands) Estimated Future Year Ending December 31, Amortization Expense 2024 $ 78,505 2025 61,883 2026 46,918 2027 38,146 2028 38,602 Thereafter 163,087 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | 9. Goodwill The Company’s reporting units for goodwill impairment evaluation purposes are the same as its reportable segments. The Company concluded that goodwill was impaired for the Business Payments segment as of December 31, 2023. As of December 31, 2023 , accumulated impairment loss was $ 75.7 million for the Business Payments segment. As of December 31, 2022 and 2021, there were no accumulated impairment losses for either the Consumer Payments or Business Payments segment. The following table presents changes to goodwill by business segment, for the years ended December 31, 2023 and 2022: ($ in thousands) Consumer Payments Business Payments Total Balance at December 31, 2021 $ 743,608 $ 80,473 $ 824,081 Measurement period adjustment 3,732 — 3,732 Reallocation ( 138,201 ) 138,201 — Balance at December 31, 2022 $ 609,139 $ 218,674 $ 827,813 Dispositions ( 35,270 ) — ( 35,270 ) Impairments — ( 75,750 ) ( 75,750 ) Balance at December 31, 2023 $ 573,869 $ 142,924 $ 716,793 During the year ended December 31, 2023, the Company recognized a reduction in goodwill of $ 35.3 million related to the disposition of BCS. In addition, the Company recognized an impairment of $ 75.7 million related to the Business Payments reporting unit during the annual goodwill impairment testing . Determining the fair value of a reporting unit is subject to uncertainty, as the Business Payments reporting unit was primarily impacted by a change in the discount rate. The impairment loss was recognized within Impairment loss in the Company’s Consolidated Statements of Operations. The fair value of the Business Payments reporting unit is considered a level 3 fair value measurement as it includes certain unobservable inputs. During the year ended December 31, 2022 , the Company recognized a $ 3.7 million measurement period adjustment in accordance with the BillingTree acquisition, primarily related to a $ 4.7 million increase in deferred tax liability as a result of the finalization of the tax basis balance sheet. An increase in accounts receivable of $ 1.0 million was also recognized related to updated collection information on the acquired receivables. The goodwill reallocation of $ 138.2 million between the Consumer Payments and Business Payments segments resulted from the relative fair value allocation of the new reporting units structure as of December 31, 2022 . |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Borrowings | 10. Borrowings Amended Credit Agreement On February 3, 2021, the Company announced the closing of a new undrawn $ 125.0 million senior secured revolving credit facility through Truist Bank. The Amended Credit Agreement replaces the Company’s Successor Credit Agreement, which included an undrawn $ 30.0 million Revolving Credit Facility. On December 29, 2021, the Company increased its existing senior secured credit facilities by $ 60.0 million to a $ 185.0 million revolving credit facility pursuant to an amendment to the Amended Credit Agreement. The Company was in compliance with its restrictive covenants under the Amended Credit Agreement at December 31, 2023. On February 9, 2023, the Company further amended the Amended Credit Agreement to replace London Inter-bank Offer Rate (“LIBOR”) with term SOFR as the interest rate benchmark. On February 28, 2023, the Company repaid in full the entire amount of $ 20.0 million of the outstanding revolving credit facility. The undrawn capacity of the existing revolving credit facility under the Amended Credit Agreement became $ 185.0 million after the repayment. As of December 31, 2023 , the Company had $ 0 drawn against the revolving credit facility. The Company’s interest expense on the revolving credit facility, including unused commitment fees and amortization of deferred issuance costs, totaled $ 3.8 million for the year ended December 31, 2023 . Interest expense was $ 4.4 million for the year ended December 31, 2022. Convertible Senior Debt On January 19, 2021, the Company issued $ 440.0 million in aggregate principal amount of 0.00 % Convertible Senior Notes due 2026 in a private placement. The initial conversion rate of the 2026 Notes was 29.7619 shares of Class A common stock per $1,000 principal amount of 2026 Notes (equivalent to an initial conversion price of approximately $ 33.60 per share of Class A common stock). Upon conversion of the 2026 Notes, the Company may choose to pay or deliver cash, shares of the Company’s Class A common stock, or a combination of cash and shares of the Company’s Class A common stock. The 2026 Notes will mature on February 1, 2026 , unless earlier converted, repurchased or redeemed. Subject to Nasdaq requirements, the Company controls the conversion rights prior to November 3, 2025, unless a fundamental change or an event of default occurs. During the year ended December 31, 2023, the conversion contingencies of the 2026 Notes were not met, and the conversion terms of the 2026 Notes were not significantly changed. The following table summarizes the total borrowings under the Amended Credit Agreement and 2026 Notes: ($ in thousands) December 31, 2023 December 31, 2022 Non-current indebtedness: Revolving Credit Facility (1) $ — $ 20,000 Convertible Senior Debt 440,000 440,000 Total borrowings 440,000 460,000 Less: Long-term loan debt issuance cost (2) 5,834 8,681 Total non-current borrowings $ 434,166 $ 451,319 (1) The revolving credit facility bears interest at variable rates, which were 6.63 % as of December 31, 2022 . (2) The Company incurred $ 2.8 million, $ 2.8 million and $ 2.5 million of interest expense for the amortization of deferred debt issuance costs for the years ended December 31, 2023, 2022 and 2021 , respectively. Following is a summary of principal maturities of borrowings outstanding as of December 31, 2023 for each of the next five years ending December 31 and in the aggregate: ($ in thousands) 2024 $ — 2025 — 2026 440,000 2027 — 2028 — $ 440,000 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Legal Matters The Company is a party to various claims and lawsuits incidental to its business. In the Company’s opinion, the liabilities, if any, which may ultimately result from the outcome of such matters, individually or in the aggregate, are not expected to have a material adverse effect on its financial position, liquidity, results of operations or cash flows. Leases The Company has commitments under operating leases for real estate leased from third parties under non-cancelable operating leases. The Company’s leases typically have lease terms between three years and ten years , with the longest lease term having an expiration date in 2035 . Most of these leases include one or more renewal options for six years or less , and certain leases also include lessee termination options . At lease commencement, the Company assesses whether it is reasonably certain to exercise a renewal option, or reasonably certain not to exercise a termination option, by considering various economic factors. Options that are reasonably certain of being exercised are factored into the determination of the lease term, and related payments are included in the calculation of the right-of-use asset and lease liability. On September 27, 2023, the Company entered an agreement with a third party to sublease one of the operating leases. The Company performed an impairment analysis and used the market approach to calculate the fair value of the associated ROU asset. An impairment loss of $ 0.1 million related to Consumer Payments segment was recorded within Other (loss) income in the Company’s Consolidated Statements of Operations as the result of the reassessment. During the year ended December 31, 2023, the Company recognized sub lease income of $ 0.1 million within Other (loss) income in the Company’s Consolidated Statements of Operations. The components of lease costs are presented in the following table: Year Ended December 31, ($ in thousands) 2023 2022 2021 Components of total lease costs: Operating lease costs $ 2,378 $ 2,678 $ 2,370 Short-term lease costs 30 52 101 Variable lease costs — — — Total lease costs $ 2,408 $ 2,730 $ 2,471 Amounts reported in the Consolidated Balance Sheets were as follows: ($ in thousands) December 31, 2023 December 31, 2022 Operating Leases: Right-of-use assets $ 8,023 $ 9,847 Lease liability, current 1,629 2,263 Lease liability, long-term 7,247 8,295 Total lease liabilities $ 8,876 $ 10,558 Weighted-average remaining lease term (in years) 4.3 4.7 Weighted-average discount rate (annualized) 5.8 % 4.5 % Other information related to leases are as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 2,312 $ 2,592 $ 2,169 Right-of-use assets obtained in exchange for lease liabilities: Operating leases — 2,511 2,438 The following table presents a maturity analysis of the Company’s operating leases liabilities as of December 31, 2023: ($ in thousands) 2024 $ 2,084 2025 2,056 2026 2,019 2027 1,213 2028 734 Thereafter 2,808 Total undiscounted lease payments 10,914 Less: Imputed interest 2,038 Total lease liabilities $ 8,876 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 12. Related Party Transactions Related party payables consisted of the following: December 31, December 31, ($ in thousands) 2023 2022 CPS accrued earnout liability $ — $ 1,000 Other payables to related parties — — $ — $ 1,000 The Company incurred transaction costs on behalf of related parties of $ 5.4 million, $ 10.6 million and $ 8.2 million for the years ended December 31, 2023, 2022 and 2021, respectively. These costs consist of retention bonuses and other compensation to employees, associated with the costs resulting from the integration of new businesses. The Company held receivables from related parties of $ 0.1 million and $ 0.3 million as of December 31, 2023 and 2022, respectively. These amounts were due from employees, related to tax withholding on vesting of equity compensation. See Note 13. Share Based Compensation for more detail on these restricted share awards. Further, the Company owed employees $ 0.0 million for amounts paid on behalf of the Company as of both December 31, 2023 and 2022. The Company owed $ 0 and $ 1.0 million to related parties, in the form of contingent consideration payable to the sellers CPS, who were employees of Repay, as of December 31, 2023 and 2022 , respectively. In March 2023, the Company paid the CPS earnout payment of $ 1.0 million. |
Share Based Compensation
Share Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share Based Compensation | 13. Share Based Compensation Omnibus Incentive Plan In connection with the Business Combination, Thunder Bridge shareholders considered and approved the Incentive Plan which resulted in the reservation of 7,326,728 shares of common stock for issuance thereunder. The Incentive Plan became effective immediately upon the closing of the Business Combination. On June 8, 2022, the Company’s shareholders approved an amendment and restatement of the Incentive Plan, which, among other modifications, increased the number of shares available for awards by 6,500,000 , so that the total reserved shares for issuance under the Incentive Plan is 13,826,728 . Under this plan, the Company currently has four types of share-based compensation awards outstanding: PSUs, RSAs, RSUs and PSOs. The following table summarized share-based compensation expense and the related income tax benefit recognized for the Company’s share-based compensation awards: Year Ended December 31, ($ in millions) 2023 2022 2021 Share-based compensation expense $ 22.2 $ 20.3 $ 22.3 Income tax benefit 1.7 2.1 3.4 RSAs and RSUs The grant date fair value of RSAs and RSUs, which is based on the quoted market value of the Company’s Class A common stock on the grant date, is recognized as share-based compensation expense on a graded vesting basis over the requisite service period. Most RSAs vest in equal annual installments over the requisite service period (which is typically a four-year period). In limited cases, RSAs may vest on the grant date with a one-year holding period. RSUs vest at the first anniversary of the grant date. Restricted shares cannot be sold or transferred until they have vested. Activity for RSAs for the year ended December 31, 2023 was as follows: Class A Common Stock Weighted Average Grant Date Fair Value Unvested at December 31, 2022 2,111,635 $ 16.23 Granted 2,727,476 6.28 Forfeited (1) 593,411 12.78 Vested 695,335 15.75 Unvested at December 31, 2023 3,550,365 9.26 Activity for RSUs for the year ended December 31, 2023 was as follows: Class A Common Stock Weighted Average Grant Date Fair Value Unvested at December 31, 2022 108,909 $ 13.22 Granted 171,384 7.41 Forfeited — — Vested 108,909 13.22 Unvested at December 31, 2023 171,384 7.41 (1) The forfeited shares include shares forfeited as a result of employee terminations and shares withheld to satisfy employees’ tax withholding and payment obligations in connection with the vesting of restricted stock awards under the Incentive Plan during the year ended December 31, 2023 ; further, these forfeited shares are added back to the amount of shares available for grant under the Incentive Plan. PSUs The grant date fair value of a PSU is based on quoted market value of the Company’s Class A common stock on the grant date or estimated using the Monte Carlo simulation. PSUs reflect a relative total shareholder return measure, such that the Company’s total shareholder return relative to a comparator group is the performance condition that determines the number of shares (if any) ultimately issued upon vesting. Compensation expense is recognized on a graded vesting basis over the applicable performance or service period. The performance or service period for awards granted is three years. Activity for PSUs for the year ended December 31, 2023 was as follows: Class A Common Stock (1) Weighted Average Grant Date Fair Value Unvested at December 31, 2022 634,023 $ 19.19 Granted 1,102,497 8.87 Forfeited 253,729 22.88 Vested — — Unvested at December 31, 2023 1,482,791 10.88 (1) Represent shares to be paid out at 100 % target level. For PSUs, RSAs, and RSUs vested during the year ended December 31, 2023 , the total fair value, based upon the Company’s Class A common stock price at the date vested, was $ 8.0 million. Unrecognized compensation expense related to unvested PSUs, RSAs and RSUs was $ 24.9 million as of December 31, 2023 , which is expected to be recognized as expense over the weighted-average period of 1.86 years. Stock Options Stock options are granted with an exercise price equal to the market value of the Company’s common stock on the grant date and have a term of seven years . Stock options vest in three tranches, and each tranche may vest upon the later of (i) the date that the market value of the Company’s common stock for a period of twenty consecutive trading days exceeds a stock price goal and (ii) the corresponding time based service requirement. Activity for PSOs for the year ended December 31, 2023 was as follows: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2022 — $ — — $ — Granted 1,148,822 6.13 Forfeited — — Exercised — — Outstanding at December 31, 2023 1,148,822 $ 6.13 7.0 $ 2,768,661 Options vested and exercisable at December 31, 2023 — $ — — $ — The Company recognized compensation expense for PSOs o f $ 1.4 million d uring the year ended December 31, 2023. Unrecognized compensation expense related to outstanding PSOs wa s $ 1.6 million at December 31, 2023 , which is expected to be recognized as expense over the weighted-average period of 1.54 years. The weighted average grant date fair value of PSOs granted during the year ended December 31, 2023 was $ 2.61 . Fair value was estimated on the date of grant using Monte Carlo simulation with the following weighted average assumptions: Year Ended December 31, 2023 Risk-free interest rate 3.42 % Expected volatility 52.82 % Dividend yield 0 % Expected term (in years) 4.5 The risk-free interest rate was based on the yield of a zero coupon U.S. Treasury security with a maturity equal to the contractual term of seven years. The assumption on expected volatility was based on the average of historical peer group volatilities using daily prices. The dividend yield assumption was determined as 0 % since the Company pays no dividends. Expected term was based on the simplified method outlined in Staff Accounting Bulletin No. 14, Share-Based Payment due to the fact that Company does not have sufficient historical data upon which to estimate an expected term. Given that the Company’s Class A common stock has been publicly traded for less than seven years, the Company believes that the simplified method is an applicable methodology to estimate the expected term of the options as of the grant date. |
Taxation
Taxation | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Taxation | 14. Taxation Repay Holdings Corporation is taxed as a corporation and is subject to paying corporate federal, state and local taxes on the income allocated to it from Hawk Parent, based upon Repay Holding Corporation’s economic interest held in Hawk Parent, as well as any stand-alone income or loss it generates. Hawk Parent is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Hawk Parent is not subject to U.S. federal and certain state and local income taxes. Hawk Parent’s members, including Repay Holdings Corporation, are liable for federal, state and local income taxes based on their allocable share of Hawk Parent’s pass-through taxable income. The components of loss before income taxes are as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Domestic $ ( 121,593 ) $ 13,305 $ ( 87,353 ) Foreign 2,058 1,610 625 Income (loss) before income tax expense (benefit) $ ( 119,535 ) $ 14,915 $ ( 86,728 ) The Company recorded a provision for income tax as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Current expense Federal $ 591 $ 1,300 $ 35 State 332 263 2 Foreign 556 419 — Total current expense $ 1,479 $ 1,982 $ 37 Deferred expense Federal $ ( 1,858 ) $ 1,421 $ ( 18,113 ) State ( 1,736 ) 2,755 ( 12,800 ) Foreign — 16 185 Total deferred expense (benefit) ( 3,594 ) 4,192 ( 30,728 ) Income tax expense (benefit) $ ( 2,115 ) $ 6,174 $ ( 30,691 ) A reconciliation of the United States statutory income tax rate to the Company’s effective income tax rate is as follows for the years indicated: Year Ended December 31, 2023 2022 2021 Federal income tax expense 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 0.1 % 0.8 % 5.2 % Income attributable to noncontrolling interest ( 1.3 %) 5.8 % ( 1.4 %) Excess tax shortfall related to share-based compensation ( 1.9 %) 5.6 % 0.6 % Business disposition ( 6.2 %) 0.0 % 0.0 % Goodwill impairment ( 12.3 %) 0.0 % 0.0 % Change in fair value of contingent consideration 0.0 % ( 4.0 %) 0.0 % Foreign rate differential ( 0.3 %) 1.4 % 0.0 % R&D credit - Federal 1.1 % ( 4.8 %) 0.0 % Provision to return - Federal 0.5 % ( 3.8 %) 0.0 % State rate change impact on deferred taxes 1.2 % 19.0 % 9.5 % Other, net ( 0.1 %) 0.5 % 0.5 % Effective tax rate 1.8 % 41.4 % 35.4 % The Company’s effective tax rate was 1.8 %, 41.4 % and 35.4 % for the years ended December 31, 2023, 2022 and 2021, respectively. The comparison of the Company’s effective tax rate to the U.S. statutory tax rate of 21 % was primarily influenced by the fact that the Company is not liable for the income taxes on the portion of Hawk Parent’s earnings that are attributable to noncontrolling interests, the impact of the goodwill impairment, the excess tax shortfall related to share-based compensation and the business disposition. Further, the comparison is reflective of the effect of remeasuring net deferred tax assets for state tax rate changes. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Details of the Company’s deferred tax assets and liabilities are as follows: ($ in thousands) December 31, 2023 December 31, 2022 Deferred tax assets Tax Credits $ 4,720 $ 3,140 Section 163(j) Limitation Carryover — 354 Acquisition Costs 289 313 Federal Net Operating Losses 26,988 31,160 State Net Operating Losses 5,604 6,308 Foreign Net Operating Losses — — Other Assets ( 12 ) 66 Partnership basis tax differences 134,422 126,806 Total deferred tax asset 172,011 168,147 Valuation allowance ( 11,924 ) ( 15,468 ) Total deferred tax asset, net of valuation allowance 160,087 152,679 Deferred tax liabilities Other intangibles - Payix ( 4,679 ) ( 6,230 ) Other liabilities ( 8,536 ) ( 10,079 ) Total deferred tax liabilities ( 13,215 ) ( 16,309 ) Net deferred tax assets $ 146,872 $ 136,370 As a result of the finalization of 2022 income tax returns, Post-Merger Repay Unit exchanges during the year ended December 31, 2023 , and estimates of current year activity, the Company recognized a reduction of the deferred tax asset (“DTA”) and offsetting deferred tax liability (“DTL”) in the amount of $ 3.8 million, compared to a reduction of $ 0.9 million during the year ended December 31, 2022, to account for the portion of the Company’s outside basis in the partnership interest that it will not recover through tax deductions, a ceiling rule limitation arising under Internal Revenue Code (the “Code”) sec. 704(c). As the ceiling rule causes taxable income allocations to be in excess of 704(b) book allocations the DTL will unwind, leaving only the DTA, which may only be recovered through the sale of the partnership interest in Hawk Parent. The Company has concluded, based on the weight of all positive and negative evidence, that all of the DTA associated with the ceiling rule limitation is not likely to be realized as of December 31, 2023 . As such, a 100 % valuation allowance was recognized. As of December 31, 2023 , the Company had net tax effected federal and state (net of federal benefit) net operating losses (“NOLs”) of $ 32.6 million, of which approximately $ 29.1 million have an indefinite life. NOLs of approximately $ 3.3 million and $ 0.1 million will begin to expire in 2034 and 2028 , respectively. As of December 31, 2023 , the Company had federal and state tax credit carryforwards of $ 3.6 million and $ 1.1 million, respectively, which will begin to expire in 2039 and 2032 . The Company believes as of December 31, 2023 , based on the weight of all positive and negative evidence, it is more likely than not that the results of future operations will generate sufficient taxable income to realize the NOLs and tax credits and, as such, no valuation allowance was recorded. No uncertain tax positions existed as of December 31, 2023. Tax Receivable Agreement Liability Pursuant to our election under Section 754 of the Code, we expect to obtain an increase in our share of the tax basis in the net assets of Hawk Parent when Post-Merger Repay Units are redeemed or exchanged for Class A common stock of Repay Holdings Corporation. The Company intends to treat any redemptions and exchanges of Post-Merger Repay Units as direct purchases for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that the Company would otherwise pay in the future to various tax authorities. They may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. On July 11, 2019, the Company entered into a TRA that provides for the payment by the Company of 100 % of the amount of any tax benefits realized, or in some cases are deemed to realize, as a result of (i) increases in our share of the tax basis in the net assets of Hawk Parent resulting from any redemptions or exchanges of Post-Merger Repay Units and from our acquisition of the equity of the selling Hawk Parent members, (ii) tax basis increases attributable to payments made under the TRA, and (iii) deductions attributable to imputed interest pursuant to the TRA (the "TRA Payments"). The TRA Payments are not conditioned upon any continued ownership interest in Hawk Parent or Repay. The rights of each party under the TRA other than the Company are assignable. The timing and amount of aggregate payments due under the TRA may vary based on a number of factors, including the timing and amount of taxable income generated by the Company each year, as well as the tax rate then applicable, among other factors. As of December 31, 2023, the Company had a liability of $ 188.9 million related to its projected obligations under the TRA, which is captioned as the tax receivable agreement liability in the Company’s Consolidated Balance Sheets. The increase of $ 9.8 million in the TRA liability for the year ended December 31, 2023 , was primarily a result of the change in the Early Termination Rate, offset by subsequent exchanges of Post-Merger Repay Units occurring during the period, as well as increase to the TRA liability as a result of accretion. |
Segments
Segments | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Segments | 15. Segments The Company organizes its business structure around two operating segments based on review of discrete financial results for each of the operating segments by the Company’s chief operating decision maker (“CODM”), for performance assessment and resource allocation purposes. Each of the Company’s operating segments represents a reportable segment based on ASC 280, Segment Reporting . The Company’s two reportable segments are as follows: (1) Consumer Payments and (2) Business Payments. The following table presents revenue and gross profit for each reportable segment. Year Ended December 31, ($ in thousand) 2023 2022 2021 Revenue Consumer Payments $ 275,708 $ 248,191 $ 194,044 Business Payments 38,058 42,600 33,818 Elimination of intersegment revenues (1) ( 17,139 ) ( 11,564 ) ( 8,604 ) Total revenue $ 296,627 $ 279,227 $ 219,258 Gross profit (2) Consumer Payments $ 216,096 $ 195,542 $ 148,614 Business Payments 27,967 30,423 23,764 Elimination of intersegment revenues ( 17,139 ) ( 11,564 ) ( 8,604 ) Total gross profit $ 226,924 $ 214,401 $ 163,774 Total other operating expenses (3) $ 338,337 $ 261,602 $ 217,771 Total other income (expense) ( 8,122 ) 62,116 ( 32,731 ) Income (loss) before income tax benefit (expense) ( 119,535 ) 14,915 ( 86,728 ) Income tax benefit (expense) 2,115 ( 6,174 ) 30,691 Net income (loss) $ ( 117,420 ) $ 8,741 $ ( 56,037 ) (1) Represents intercompany eliminations between segments for consolidation purpose. (2) Represents revenue less costs of services. (3) Represents total operating expenses less costs of services (exclusive of depreciation and amortization). Revenue and costs of services are attributed directly to each segment. There is no significant concentration of revenue or assets in foreign countries as of December 31, 2023. The CODM reporting package does not include interest income (expense), net, depreciation and amortization, income tax benefit (expense) and discrete asset details of the operating segments as this information is not considered by the CODM for resource allocation or other segment analysis purposes. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | 16. Subsequent Events Management has evaluated subsequent events and their potential effects on these consolidated financial statements. Based upon the review, management did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Repay Holdings Corporation and its majority-owned subsidiary, Hawk Parent Holdings LLC, along with Hawk Parent Holdings LLC’s wholly owned subsidiaries: Hawk Intermediate Holdings, LLC, Hawk Buyer Holdings, LLC, Repay Holdings, LLC, M&A Ventures, LLC, Repay Management Holdco Inc., Repay Management Services LLC, Sigma Acquisition, LLC, Wildcat Acquisition, LLC, Marlin Acquirer, LLC, REPAY International LLC, REPAY Canada Solutions ULC, TriSource Solutions, LLC (“TriSource”), Mesa Acquirer, LLC, CDT Technologies LTD (“Ventanex”), Viking GP Holdings, LLC, cPayPlus, LLC (“cPayPlus”), CPS Payment Services, LLC, Media Payments, LLC (“Media Payments”), Custom Payment Systems, LLC, Electronic Payment Providers, LLC, Internet Payment Exchange, LLC, Stratus Payment Solutions, LLC, Clear Payment Solutions, LLC, Harbor Acquisition LLC, Payix Holdings Incorporated and Payix Incorporated. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Basis of Financial Statement Presentation | Basis of Financial Statement Presentation The accompanying consolidated financial statements of the Company were prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The Company uses the accrual basis of accounting whereby revenues are recognized when earned, usually upon the date services are rendered, and expenses are recognized at the date services are rendered or goods are received. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported consolidated statements of operations during the reporting period. Actual results could differ materially from those estimates. |
Segment Reporting | Segment Reporting The Company reports operating results through two reportable segments: (1) Consumer Payments and (2) Business Payments, as further discussed in Note 15. Segments. There are no significant concentrations by state or geographical location, nor are there any significant individual client concentrations by balance. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand, demand deposit accounts, money market accounts and short‑term investments with original maturities of three months or less. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The amount of cash that the Company considers to be available for general purposes was $ 118.1 million and $ 64.9 million as of December 31, 2023 and 2022, respectively. As of December 31, 2023 , approximately 82 % of the Company’s total balance of cash and cash equivalents was held within a small group of financial institutions, primarily large money center banks. Although the Company currently believes that the financial institutions with whom the Company does business will be able to fulfill their commitments to the Company, there is no assurance that those institutions will be able to continue to do so. The Company has no t experienced any losses associated with the Company’s balances in such accounts for the years ended December 31, 2023 , 2022 or 2021. |
Restricted Cash | Restricted Cash Restricted cash primarily consists of (i) ACH settlement funds in transit (“Settlements”) and (ii) collateral reserve funds (“Reserves”). Settlements are held in accounts maintained at the Company’s sponsor banks for the purpose of facilitating the clearing and settlement of funds associated with payments made by or to the Company’s clients via the ACH network. The Company records a corresponding liability for Settlements within Accrued expenses in the Consolidated Balance Sheets. Reserves are held on deposit by the Company’s sponsor banks to secure potential merchant chargebacks or other similar losses or obligations. |
Accounts Receivable | Accounts Receivable Accounts receivable represent amounts due from clients and payment processors for services rendered. The Company has an established process for aging, provisioning and writing-off its uncollectible accounts receivable. Within this process the Company aggregates accounts receivable to the pools of receivables of similar risk characteristics. The allowance for credit losses on accounts receivables is estimated based on how long a receivable has been outstanding (e.g., under 30 days, 30–60 days, etc.). For accounts receivable outstanding more than 90 days, the Company evaluates and assesses whether the loss reserve percentage requires adjustment for reasonable and supportable forecast of relevant economic factors. As of December 31, 2023 , the Company’s estimated credit losses on accounts receivable was immaterial. |
Concentration of Credit Risk | Concentration of Credit Risk The Company is highly diversified, and no single client represents greater than 10 % of the business on a volume or profit basis. The Company holds cash and cash equivalents with various major financial institutions. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. |
Earnings per Share | Earnings per Share Basic earnings per share of Class A common stock is computed by dividing net income (loss) attributable to the Company by the weighted average number of shares of Class A common stock outstanding during the period. Diluted earnings per share of Class A common stock is computed by dividing net income attributable to the Company, by the weighted average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive elements, including the assumed exchange of all limited liability company interests of Hawk Parent (“Post-Merger Repay Units”), unvested share-based awards, outstanding ESPP (“Employee Stock Purchase Program”) purchase rights and the Company’s Convertible Senior Notes due 2026 (“2026 Notes”). |
Property and Equipment | Property and Equipment Property and equipment is carried at cost less accumulated depreciation and includes expenditures which substantially increase the useful lives of existing property and equipment. Maintenance, repairs, and minor renovations are charged to operations as incurred. When property and equipment is retired or otherwise disposed of, the related costs and accumulated depreciation are removed from their respective accounts, and any gain or loss on the disposition is credited or charged to operations. The Company provides for depreciation of property and equipment using the straight-line method designed to amortize costs over estimated useful lives as follows: Estimated Useful Life Furniture, fixtures, and office equipment 5 years Computers 3 years Leasehold improvements Lesser of 5 years or lease term The Company evaluates the recoverability of property and equipment at least annually or whenever events or changes in circumstances indicate that the carrying amount of property and equipment may not be recoverable. The evaluation of asset impairment requires the Company to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from assumed and estimated amounts. If the carrying amount of property and equipment is determined not to be recoverable, a write-down to fair value is recorded. No impairments were recognized for the years ended December 31, 2023, 2022 and 2021 . |
Intangible Assets | Intangible Assets Intangible assets consist of internal-use software development costs, purchased software, channel relationships, client relationships, certain key personnel non-compete agreements, and trade names. The Company capitalizes internal-use software development costs when the Company has completed the preliminary project stage, management authorizes the project, management commits to funding the project, it is probable the project will be completed and the project will be used to perform the function intended. The Company is amortizing internal-use software development costs and purchased software on the straight‑line method over a three-year estimated useful life, a ten-year estimated useful life for channel and client relationships, and an estimated useful life for non-compete agreements equal to the term of the agreement. Trade names are determined to have an indefinite useful life. The Company evaluates the recoverability of intangible assets at least annually or whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. The evaluation of asset impairment requires the Company to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from assumed and estimated amounts. During the year ended December 31, 2023 , the Company recognized an impairment of $ 0.1 million related to a trade name write-off of Media Payments, as the Company strategically phased out the trade name of the acquired business. During the year ended December 31, 2022, the Company recognized impairments of $ 8.1 million related to write-offs of certain trade names, as the Company strategically phased out the trade names of several acquired business, which included BillingTree, Kontrol and Payix. During the year ended December 31, 2021, the Company recognized impairments of $ 2.2 million related to write-offs of certain trade names, as the Company strategically phased out the trade names of several acquired business, which included TriSource, APS, Ventanex, cPayPlus and CPS. |
Goodwill | Goodwill Goodwill represents the excess of purchase price over tangible and intangible assets acquired less liabilities assumed arising from business combinations. Goodwill is generally allocated to reporting units based upon relative fair value (taking into consideration other factors such as synergies) when an acquired business is integrated into multiple reporting units. The Company’s reporting units are at the operating segment level or one level below the operating segment level for which discrete financial information is prepared and regularly reviewed by management. When a business within a reporting unit is disposed of, goodwill is allocated to the disposed business using the relative fair value method. Relative fair value is estimated using a combination of a discounted cash flow (“DCF”) analysis and market valuation approach. The Company performs a qualitative goodwill assessment at the reporting unit level at least annually, or more frequently as events occur or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. Factors considered in the Company’s qualitative assessment include financial performance, financial forecasts, macroeconomic conditions, industry and market conditions, cost factors, market capitalization, carrying value, and events affecting the reporting units. If, after considering all relevant events and circumstances, the Company determines it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, then it is necessary to perform a quantitative impairment test. If the Company elects to bypass the qualitative analysis, or concludes from the Company’s qualitative analysis that it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, a quantitative impairment test is performed by comparing the fair value of each reporting unit with its carrying amount. If the fair value is greater than the carrying amount, then the reporting unit’s goodwill is deemed not to be impaired. If the fair value is less than the carrying amount, a non-cash impairment loss is recognized for the amount by which a reporting unit’s carrying amount exceeds its fair value, without exceeding the total amount of goodwill allocated to that reporting unit. Management estimates the fair value of the reporting units using a combination of a DCF calculation, which is a form of the income approach, and a market multiples calculation, which is a form of the market approach. The Company uses internal forecasts to estimate future cash flows expected to be generated by the reporting units when preparing DCF models under the income approach. To discount these cash flows, the Company uses an estimated weighted average cost of capital, which incorporates market and company-specific risk factors. The Company applies comparable publicly traded companies’ multiples (e.g., revenue or Adjusted EBITDA) to the Company’s reporting units’ financial forecasts when using market multiples under the market approach. During the Company’s annual goodwill impairment testing conducted on December 31, 2023, the Company concluded that goodwill associated with the Business Payments segment became impaired, as this reporting unit was primarily impacted by a change in the discount rate. The Company recognized an impairment loss of $ 75.7 million on goodwill related to the Business Payments segment within the Impairment loss in the Company’s Consolidated Statements of Operations. The goodwill impairment testing of the Business Payments segment is subject to assumptions and judgments management made as part of the assessment to estimate the fair value of the segment. The income approach required management assumptions, such as assumptions used in the cash flow forecasts, the discount rate, and the terminal value. The market approach required significant judgment in the selection of appropriate peer group companies and valuation multiples. |
Revenue | Revenue Repay provides integrated payment processing solutions to niche markets that have specific transaction processing needs; for example, personal loans, automotive loans, and receivables management. The Company contracts with its clients through contractual agreements that set forth the general terms and conditions of the service relationship, including rights of obligations of each party, line item pricing, payment terms and contract duration. Most of our revenues are derived from volume-based payment processing fees (“discount fees”) and other related fixed per transaction fees. Discount fees represent a percentage of the dollar amount of each credit or debit transaction processed and include fees relating to processing and services that we provide. As our clients process increased volumes of payments, our revenues increase as a result of the fees we charge for processing these payments. The Company’s performance obligation in its contracts with clients is the promise to stand-ready to provide front-end authorization and back-end settlement payment processing services (“processing services”) for an unknown or unspecified quantity of transactions and the consideration received is contingent upon the client’s use (e.g., number of transactions submitted and processed) of the related processing services. Accordingly, the total transaction price is variable. These services are stand-ready obligations, as the timing and quantity of transactions to be processed is not determinable. Under a stand-ready obligation, the Company’s performance obligation is satisfied over time throughout the contract term rather than at a point in time. Because the service of standing ready to perform processing services is substantially the same each day and has the same pattern of transfer to the client, the Company has determined that its stand-ready performance obligation comprises a series of distinct days of service. Discount fees and other fixed per transaction fees are recognized each day using a time-elapsed output method based on the volume or transaction count at the time the clients’ transactions are processed. The Company has processing contracts that contain annual minimums to which the Company would be entitled to bill the shortfall between the actual processing revenue incurred during the annual period and the specified minimum in the contract. At the beginning of each annual period, the Company assesses the appropriate amount of the guaranteed minimums (either the fixed consideration or fixed consideration plus estimated overages) to recognize on a time-elapsed basis over the annual period. Revenues are also derived from transaction or service fees (e.g. chargebacks, gateway) as well as other miscellaneous service fees. These services are considered immaterial in the overall context of our contractual arrangements and, as such, do not represent distinct performance obligations. Instead, the fees associated with these services are bundled with the processing services performance obligation identified. The transaction price for such processing services is determined, based on the judgment of the Company’s management, considering factors such as margin objectives, pricing practices and controls, client segment pricing strategies, the product life cycle and the observable price of the service charged to similarly situated clients. The Company follows the requirements of ASC 606-10-55-36 through -40, Revenue from Contracts with Customers, Principal Agent Considerations , in determining the gross versus net revenue presentation for each performance obligation in the contract with a client. Revenue recorded by the Company in the capacity as a principal is reported on a gross basis equal to the full amount of consideration to which the Company expects in exchange for the good or service transferred. Revenue recorded with the Company acting in the capacity of an agent is reported on a net basis, exclusive of any consideration provided to the principal party in the transaction. The principal versus agent evaluation is matter of judgment that depends on the facts and circumstances of the arrangement and is dependent on whether the Company controls the good or service before it is transferred to the client or whether the Company is acting as an agent of a third party. This evaluation is performed separately for each performance obligation identified. When the Company acts as an agent, the fees collected from clients on behalf of the payment networks and card issuer is netted with the gross fees collected so that the net revenue is presented within Revenue in the Consolidated Statements of Operations. Indirect relationships As a result of its past acquisitions, the Company has legacy relationships with ISOs, whereby the Company acts as the merchant acquirer for the ISO. The ISO maintains a direct relationship with the sponsor bank and the transaction processor, rather than the Company. Consequently, the Company recognizes revenue for these relationships net of the residual amount remitted to the ISO, based on the fact that the ISO is primarily responsible for providing the transaction processing services to the merchant. The Company is not focused on this sales model, and this relationship will represent an increasingly smaller portion of the business over time. Contract Costs The incremental costs of obtaining a contract are recognized as an asset if the cost is incremental to obtaining a contract, and whether the costs are recoverable from the client. If both criteria are not met, costs are expensed as incurred. If the amortization period of the capitalized commission cost asset is less than one year, the Company may elect a practical expedient per ASC 340-40-25-4 to expense commissions as incurred. The amortization period is consistent with the concept of useful life under other accounting guidance, which is defined as the period over which an asset is expected to contribute directly or indirectly to future cash flows. The Company currently incurs costs to obtain a contract through payments made to external referral partners. Commission payments are made to the external referral partner on a monthly basis based on a percentage of the profit on the contract, for as long as the client and the external referral partner have agreements with the Company. Any capitalized commission cost assets have an amortization period of one year or less, therefore the Company utilizes the practical expedient to expense commissions as incurred. Costs to fulfill contracts with clients either give rise to an asset or are expensed as incurred. If the cost is not already covered by other applicable accounting literature, fulfillment costs are capitalized to the extent they directly relate to a specific contract, are used to generate or enhance resources used in satisfying performance obligations and are expected to be recovered. The Company does not have any costs incurred to fulfill a contract. Practical Expedients The Company has utilized the portfolio approach practical expedient per ASC 606-10-10-4, which allows the application of ASC 606 to a portfolio of contracts with similar characteristics provided the accounting does not differ materially to application of ASC 606 to the individual contract. The Company has also utilized the practical expedient for immaterial goods and services per ASC 606-10-25-16A, which permits the Company not to recognize a promised good or service as a performance obligation if it is considered an immaterial promise in the context of the contract. |
Transaction Costs | Transaction Costs The Company expenses all transaction costs associated with a business combination as incurred and such expenses are included in Selling, general, and administrative expenses in the Consolidated Statements of Operations. For the years ended December 31, 2023, 2022 and 2021 , the Company incurred $ 3.4 million, $ 13.7 million and $ 9.3 million transaction costs, respectively. |
Equity Units Awarded | Equity Units Awarded The Repay Holdings Corporation 2019 Omnibus Incentive Plan (as amended, the “Incentive Plan”) provides for the grant of various equity-based incentive awards to employees, directors, consultants and advisors to the Company. The types of equity-based awards that may be granted under the Incentive Plan include: stock appreciation rights (“SARs”), performance stock units (“PSUs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance-based stock options (“PSOs”) and other stock-based awards. As of December 31, 2023 , there were 2,137,122 shares of Class A common stock available for future issuance under the Incentive Plan. The Company accounts for stock-based compensation for employees and directors in accordance with ASC 718, Compensation (“ASC 718”). ASC 718 requires all share-based payments to employees to be recognized in the statement of operations based on their fair values. Under the provisions of ASC 718, stock-based compensation costs are measured at the grant date, based on the fair value of the award, and are recognized as expense over the employee’s requisite or derived service period. PSUs, RSAs, RSUs and stock options granted under the Incentive Plan are measured based on the fair value of the awards on the date of the grant. Compensation expense is recognized for those awards over the requisite service period within Selling, general, and administrative in the Consolidated Statements of Operations. Forfeitures are accounted for as they occur. |
Debt Issuance Costs | Debt Issuance Costs The Company accounts for debt issuance costs according to the Financial Accounting Standards Board Accounting Standards Update 2015-03, Simplifying the Presentation of Debt Issuance Costs , to present debt issuance costs as a reduction of the carrying amount of the debt. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company accounts for fair value measurements in accordance with ASC 820, Fair Value Measurements and Disclosures , which defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or the price paid to transfer a liability as of the measurement date. A three-tier, fair-value reporting hierarchy exists for disclosure of fair value measurements based on the observability of the inputs to the valuation of financial assets and liabilities. The three levels are: • Level 1 — Quoted prices for identical instruments in active markets. • Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in active exchange markets. The carrying value of the Company’s financial instruments, including cash and cash equivalents, restricted cash, accounts receivable and accounts payable approximated their fair values as of December 31, 2023 and 2022 , because of the relatively short maturity dates on these instruments. See Note 6. Fair Value of Assets and Liabilities for further discussion. |
Leases | Leases The Company evaluates each of its lease and service arrangements at inception to determine if the arrangement is, or contains, a lease and the appropriate classification of each identified lease. A lease exists if the Company obtains substantially all of the economic benefits of, and has the right to control the use of, an asset for a period of time. The Company has operating leases for real estate. Operating leases with an original lease term in excess of twelve months are included in Operating lease right-of-use assets, net, Current operating lease liabilities and Noncurrent operating lease liabilities in the Consolidated Balance Sheets. Right-of-use (“ROU”) assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate to calculate the present value of lease payments. Lease terms consider options to extend or terminate based on the determination of whether such renewal or termination options are deemed reasonably certain. Lease agreements that contain non-lease components are generally accounted for as a single lease component. Operating lease costs are recorded in Selling, general and administrative in the Consolidated Statements of Operations based on the underlying asset. Variable costs, such as maintenance expenses, property and sales taxes, association dues and index-based rate increases, are expensed as they are incurred. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented as operating expenses in Selling, general and administrative in the Consolidated Statements of Operations. The Company has elected not to recognize ROU assets and lease liabilities for short-term leases of all applicable class of underlying assets that have a lease term of twelve months or less. The Company recognizes the lease payments associated with its short-term leases as an expense on a straight-line basis over the lease term. Variable lease payments associated with these leases are recognized and presented in the same manner as for all other Company leases. ROU assets for operating leases are periodically reduced by impairment losses. During the year ended December 31, 2023 , the Company recognized an impairment loss of $ 0.1 million related to the Consumer Payments segment when the Company entered an agreement with a third party to sublease one of the operating leases. The impairment loss was recorded within Other (loss) income in the Company's Consolidated Statements of Operations. The Company monitors for events or changes in circumstances that require a reassessment of a lease. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in gain or loss in the Consolidated Statements of Operations. |
Taxation | Taxation Income taxes are provided for in accordance with ASC 740. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to net operating losses, tax credits, and temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period of the enactment date. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will not be realized. The Company reports a liability or a reduction of deferred tax assets for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. When applicable, the Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. |
Noncontrolling Interest | Noncontrolling Interest As of December 31, 2023, 2022, and 2021 the Company held an interest o f 94.2 %, 92.0 %, and 91.9 % in Hawk Parent, respectively. For the years ended December 31, 2023, 2022, and 2021, the noncontrolling interest in the net loss of subsidiaries was $ 6.9 million , $ 4.1 million, and $ 6.0 million, respectively. |
Contingent Consideration | Contingent Consideration The Company estimates and records the acquisition date estimated fair value of contingent consideration as part of purchase price consideration for acquisitions. Additionally, each reporting period, the Company estimates changes in the fair value of contingent consideration, and any change in fair value is recognized in the Consolidated Statements of Operations. An increase in the contingent consideration expected to be paid will result in a charge to operations in the period that the anticipated fair value of contingent consideration increases, while a decrease in the contingent consideration expected to be paid will result in a credit to operations in the period that the anticipated fair value of contingent consideration decreases. The estimate of the fair value of contingent consideration requires subjective assumptions to be made of future operating results, discount rates, and probabilities assigned to various potential operating result scenarios. |
Incurred But Not Reported ("IBNR") Reserve | Incurred But Not Reported ( “IBNR”) Reserve IBNR reserve includes the estimated liability related to the claims of the Company’s self-funded medical insurance policy for employees. The liability for these claims is based on the Company’s estimated ultimate cost of settling all claims. The Company derives estimates for the development of IBNR claims using actuarial methods that are based on many variables, including historical patterns of claims, cost trends, and other factors. At December 31, 2023 , the Company recognized $ 0.9 million of IBNR reserve recorded within Accrued expenses in the Consolidated Balance Sheets. |
Recently Adopted Accounting Pronouncements/Recently Issued Accounting Pronouncements not yet Adopted | Recently Adopted Accounting Pronouncements Reference Rate Reform In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, “ Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”)”, which provides optional expedients and exceptions to contracts, hedging relationships and other transactions affected by the transition away from LIBOR to alternative reference rates. In January 2021, the FASB issued ASU 2021-01, “ Reference Rate Reform (Topic 848): Scope ”, to expand the scope of this guidance to include derivatives. The guidance was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into on or before December 31, 2022. In December 2022, the FASB issued ASU 2022-06, “ Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 ”, which extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022, to December 31, 2024. The Company adopted these ASUs for the revolving credit facility as of February 9, 2023. Starting July 1, 2023, the Company applied Secured Overnight Financing Rate (“SOFR”) to the Tax Receivable Agreement (“TRA”) fair value measurement. The adoption of these standards did not have a material impact on the Company’s Consolidated Financial Statements. Business Combinations In August 2021, the FASB issued Accounting Standards Update No. 2021-08, “ Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”)”. ASU 2021-08 requires an entity (acquirer) to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Revenue (Topic 606) , and is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. Amendments within ASU 2021-08 are required to be applied prospectively to business combinations occurring on or after the effective date of the amendments. The Company adopted ASU 2021-08 as of January 1, 2023. The adoption of this standard did not have a material impact on the Company’s Consolidated Financial Statements. Recently Issued Accounting Pronouncements not yet Adopted Segment Reporting In November 2023, the FASB issued Accounting Standards Update No. 2023-07, “ Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”)”. ASU 2023-07 improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, on an annual and interim basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the effects of ASU No. 2023-07 on its Consolidated Financial Statements. Income Taxes In December 2023, the FASB issued Accounting Standards Update No. 2023-09, “ Income Taxes (Topic 740): Improvements to Income Tax Disclosure s (“ASU 2023-09”)”. ASU 2023-09 requires public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the effects of ASU No. 2023-09 on its Consolidated Financial Statements. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Life of Property and Equipment | The Company provides for depreciation of property and equipment using the straight-line method designed to amortize costs over estimated useful lives as follows: Estimated Useful Life Furniture, fixtures, and office equipment 5 years Computers 3 years Leasehold improvements Lesser of 5 years or lease term |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | The following table presents the Company’s revenue disaggregated by segment and by the type of relationship for the years ended December 31, 2023, 2022, and 2021. Year Ended December 31, 2023 ($ in thousands) Consumer Payments Business Payments Elimination of intersegment revenues Total Revenue Direct relationships $ 263,564 $ 36,989 $ ( 17,139 ) $ 283,414 Indirect relationships 12,144 1,069 — 13,213 Total Revenue $ 275,708 $ 38,058 $ ( 17,139 ) $ 296,627 Year Ended December 31, 2022 ($ in thousands) Consumer Payments Business Payments Elimination of intersegment revenues Total Revenue Direct relationships $ 234,905 $ 41,610 $ ( 11,564 ) $ 264,951 Indirect relationships 13,286 990 — 14,276 Total Revenue $ 248,191 $ 42,600 $ ( 11,564 ) $ 279,227 Year Ended December 31, 2021 ($ in thousands) Consumer Payments Business Payments Elimination of intersegment revenues Total Revenue Direct relationships $ 189,019 $ 32,837 $ ( 8,604 ) $ 213,252 Indirect relationships 5,025 981 — 6,006 Total Revenue $ 194,044 $ 33,818 $ ( 8,604 ) $ 219,258 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Summary of Net Income (Loss) and Weighted Average Basic and Diluted Shares Outstanding | The following table summarizes net income (loss) attributable to the Company and the weighted average basic and diluted shares outstanding: Year Ended December 31, ($ in thousands, except per share data) 2023 2022 2021 Income (loss) before income tax expense $ ( 119,535 ) $ 14,915 $ ( 86,728 ) Less: Net loss attributable to non-controlling interests ( 6,930 ) ( 4,095 ) ( 5,953 ) Income tax (expense) benefit 2,115 ( 6,174 ) 30,691 Net income (loss) attributable to the Company $ ( 110,490 ) $ 12,836 $ ( 50,084 ) Weighted average shares of Class A common stock outstanding - basic 90,048,638 88,792,453 83,318,189 Add weighted average effect of dilutive common stock equivalent shares: Post-Merger Repay Units exchangeable for Class A common stock 7,892,176 Unvested share-based awards of Class A common stock 890,309 Outstanding ESPP purchase rights for Class A common stock 1,554 2026 Notes convertible into Class A common stock 13,095,238 Weighted average shares of Class A common stock outstanding - diluted 90,048,638 110,671,731 83,318,189 Income (loss) per share of Class A common stock outstanding - basic $ ( 1.23 ) $ 0.14 $ ( 0.60 ) Income (loss) per share of Class A common stock outstanding - diluted $ ( 1.23 ) $ 0.12 $ ( 0.60 ) |
Summary of Components of Common Stock Equivalent Shares Excluded from Computation of Diluted Loss per Share | For the years ended December 31, 2023 and 2021, the following common stock equivalent shares were excluded from the computation of the diluted loss per share, since their inclusion would have been anti-dilutive: Year Ended December 31, 2023 2021 Post-Merger Repay Units exchangeable for Class A common stock 5,844,095 7,926,576 Unvested share-based awards of Class A common stock 5,204,540 2,515,634 Outstanding stock options for Class A common stock 1,148,822 — 2026 Notes convertible for Class A common stock 13,095,238 13,095,238 Share equivalents excluded from earnings (loss) per share 25,292,695 23,537,448 |
Business Combinations and Dis_2
Business Combinations and Dispositions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Acquisition [Line Items] | |
Summary of Pro Forma Financial Information | The supplemental consolidated results of the Company on an unaudited pro forma basis give effect to BillingTree, Kontrol and Payix acquisitions as if the transactions had occurred on January 1, 2021. The unaudited pro forma information reflects adjustments for the issuance of the Company’s common stock, debt incurred in connection with the transactions, the impact of the fair value of intangible assets acquired and related amortization and other adjustments the Company believes are reasonable for the pro forma presentation. In addition, the pro forma earnings exclude acquisition-related costs. ($ in thousands, except per share data) Pro Forma Year Ended December 31, 2021 Revenue $ 257,014 Net loss ( 54,627 ) Net loss attributable to non-controlling interests ( 5,813 ) Net loss attributable to the Company ( 48,814 ) Loss per Class A share - basic $ ( 0.56 ) Loss per Class A share - diluted $ ( 0.56 ) |
Billing Tree | |
Business Acquisition [Line Items] | |
Summary of Preliminary Purchase Consideration | The following summarizes the purchase consideration paid to the seller of BillingTree: ($ in thousands) Cash consideration $ 277,521 Class A common stock issued 228,250 Total purchase price $ 505,771 |
Summary of Preliminary and Final Purchase Allocation | The Company recorded an allocation of the purchase price to BillingTree’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the June 15, 2021 closing date. The purchase price allocation is as follows: ($ in thousands) Cash and cash equivalents $ 8,244 Accounts receivable 4,627 Prepaid expenses and other current assets 1,602 Total current assets 14,473 Property, plant and equipment, net 541 Restricted cash 275 Other assets 1,782 Identifiable intangible assets 236,810 Total identifiable assets acquired 253,881 Accounts payable ( 2,552 ) Accrued expenses and other liabilities ( 6,983 ) Deferred tax liability ( 36,095 ) Net identifiable assets acquired 208,251 Goodwill 297,520 Total purchase price $ 505,771 |
Summary of Preliminary Values Allocated to Identifiable Intangible Assets and Estimated Useful Lives | The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair Value Useful life Identifiable intangible assets (in millions) (in years) Non-compete agreements $ 0.3 2 Trade names 7.8 Indefinite Developed technology 26.2 3 Merchant relationships 202.5 10 $ 236.8 |
Kontrol | |
Business Acquisition [Line Items] | |
Summary of Preliminary Purchase Consideration | The following summarizes the purchase consideration paid to the owner of Kontrol: ($ in thousands) Cash consideration $ 7,439 Contingent consideration (1) 500 Total purchase price $ 7,939 (1) Reflects the fair value of the Kontrol earnout payment, the contingent consideration to be paid to the selling members of Kontrol, pursuant to the Kontrol Purchase Agreement as of June 22, 2021. The selling partners of Kontrol will have the contingent earnout right to receive a payment of up to $ 3.0 million, dependent upon the Gross Profit, as defined in the Kontr ol Purchase Agreement. As of December 31, 2022, the fair value of the Kontrol earnout was $ 0 , which resulted in a ($ 0.9 ) million a djustment included in the change in fair value of contingent consideration in the Consolidated Statements of Operations for the year ended December 31, 2022. |
Summary of Preliminary and Final Purchase Allocation | The Company recorded an allocation of the purchase price to Kontrol’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the June 22, 2021 closing date. The purchase price allocation is as follows: ($ in thousands) Accounts receivable $ 68 Prepaid expenses and other current assets 6 Total current assets 74 Identifiable intangible assets 6,940 Total identifiable assets acquired 7,014 Accounts payable ( 665 ) Net identifiable assets acquired 6,349 Goodwill 1,590 Total purchase price $ 7,939 |
Summary of Preliminary Values Allocated to Identifiable Intangible Assets and Estimated Useful Lives | The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair Value Useful life Identifiable intangible assets (in millions) (in years) Trade names $ 0.0 Indefinite Merchant relationships 6.9 8 $ 6.9 |
Payix | |
Business Acquisition [Line Items] | |
Summary of Preliminary Purchase Consideration | The following summarizes the purchase consideration paid to the sellers of Payix: ($ in thousands) Cash consideration $ 95,628 Contingent consideration (1) 2,850 Total purchase price $ 98,478 (1) Reflects the fair value of the Payix earnout payment, the contingent consideration to be paid to the former owners of Payix, pursuant to the Payix Purchase Agreement as of December 31, 2021. The former owners of Payix will have the contingent earnout right to receive a payment of up to $ 20.0 million, dependent upon the Gross Profit, as defined in the Payix Purchase Agreement. As of December 31, 2022, the fair value of the Payix earnout was $ 0 , which resulted in a ($ 2.9 ) million ad justment included in the change in fair value of contingent consideration in the Consolidated Statements of Operations for the year ended December 31, 2022. |
Summary of Preliminary and Final Purchase Allocation | The Company recorded an allocation of the purchase price to Payix’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the December 29, 2021 closing date. The purchase price allocation is as follows: ($ in thousands) Cash and cash equivalents $ 703 Accounts receivable 1,715 Prepaid expenses and other current assets 94 Total current assets 2,512 Property, plant and equipment, net 83 Restricted cash 27 Other assets 656 Identifiable intangible assets 33,150 Total identifiable assets acquired 36,428 Accounts payable ( 214 ) Accrued expenses and other liabilities ( 2,023 ) Deferred tax liability ( 6,944 ) Net identifiable assets acquired 27,247 Goodwill 71,231 Total purchase price $ 98,478 |
Summary of Preliminary Values Allocated to Identifiable Intangible Assets and Estimated Useful Lives | The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair Value Useful life Identifiable intangible assets (in millions) (in years) Trade names $ 0.3 Indefinite Developed technology 12.4 3 Merchant relationships 20.5 10 $ 33.2 |
Fair Value of Assets and Liab_2
Fair Value of Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Carrying Amounts and Estimated Fair Values of Assets and Liabilities Measured at Fair Value | The following table summarizes, by level within the fair value hierarchy, the estimated fair values of our assets and liabilities measured at fair value on a recurring or nonrecurring basis or disclosed, but not carried, at fair value in the Consolidated Balance Sheets as of the dates presented. There were no transfers into, out of, or between levels within the fair value hierarchy during any of the periods presented. December 31, 2023 ($ in thousands) Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 118,096 $ — $ — $ 118,096 Other assets — 2,500 — 2,500 Total assets $ 118,096 $ 2,500 $ — $ 120,596 Liabilities: Contingent consideration $ — $ — $ — $ — Borrowings — 375,650 — 375,650 Tax receivable agreement — — 188,911 188,911 Total liabilities $ — $ 375,650 $ 188,911 $ 564,561 December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 64,895 $ — $ — $ 64,895 Other assets — 2,500 — 2,500 Total assets $ 64,895 $ 2,500 $ — $ 67,395 Liabilities: Contingent consideration $ — $ — $ 1,000 $ 1,000 Borrowings — 344,280 — 344,280 Tax receivable agreement — — 179,127 179,127 Total liabilities $ — $ 344,280 $ 180,127 $ 524,407 |
Schedule of Carrying Value and Estimated Fair Value of Borrowings | The following table provides the carrying value and estimated fair value of borrowings. See Note 10. Borrowings for further discussion. December 31, 2023 December 31, 2022 ($ in thousands) Carrying value Fair value Carrying value Fair value Revolving credit facility $ — $ — $ 18,177 $ 20,000 2026 Notes 434,166 375,650 433,142 324,280 Total $ 434,166 $ 375,650 $ 451,319 $ 344,280 |
Schedule of Contingent Consideration Related to Previous Business Acquisitions | The following table provides a rollforward of the contingent consideration related to previous business acquisitions. Refer to Note 5. Business Combinations for more details. Year Ended December 31, ($ in thousands) 2023 2022 Balance at beginning of period $ 1,000 $ 17,047 Purchases — — Payments ( 1,000 ) ( 12,747 ) Valuation adjustment — ( 3,300 ) Balance at end of period $ — $ 1,000 |
Tax Receivable Agreement | |
Schedule of Contingent Consideration Related to Previous Business Acquisitions | The following table provides a rollforward of the TRA related to the Business Combination and subsequent exchanges of Post-Merger Repay Units. See Note 14. Taxation for further discussion on the TRA. Year Ended December 31, ($ in thousands) 2023 2022 2021 Balance at beginning of period $ 179,127 $ 245,828 $ 229,228 Purchases 3,164 170 2,491 Accretion expense 12,362 7,806 5,065 Valuation adjustment ( 5,742 ) ( 74,677 ) 9,044 Balance at end of period $ 188,911 $ 179,127 $ 245,828 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following: December 31, December 31, ($ in thousands) 2023 2022 Furniture, fixtures, and office equipment $ 4,905 $ 4,014 Computers 4,813 4,889 Leasehold improvements 663 659 Total 10,381 9,562 Less: Accumulated depreciation and amortization 7,248 5,187 $ 3,133 $ 4,375 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule Of Intangible Assets | Intangible assets consisted of the following: ($ in thousands) Gross Carrying Value Accumulated Amortization Net Carrying Value Weighted Average Useful Life (Years) Client relationships $ 523,850 $ 190,591 $ 333,259 6.32 Channel relationships 29,785 4,792 24,993 8.39 Software costs 246,996 178,323 68,673 0.83 Non-compete agreements 4,580 4,364 216 0.23 Trade name 20,000 — 20,000 — Balance as of December 31, 2023 $ 825,211 $ 378,070 $ 447,141 4.68 Client relationships $ 539,850 $ 137,515 $ 402,335 7.40 Channel relationships 16,240 3,168 13,072 8.06 Software costs 196,890 132,322 64,568 0.99 Non-compete agreements 4,580 4,030 550 0.54 Trade name 20,050 — 20,050 — Balance as of December 31, 2022 $ 777,610 $ 277,035 $ 500,575 5.71 |
Schedule of Estimated Amortization Expense | The estimated amortization expense for the next five years and thereafter in the aggregate is as follows: ($ in thousands) Estimated Future Year Ending December 31, Amortization Expense 2024 $ 78,505 2025 61,883 2026 46,918 2027 38,146 2028 38,602 Thereafter 163,087 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes to Goodwill | The following table presents changes to goodwill by business segment, for the years ended December 31, 2023 and 2022: ($ in thousands) Consumer Payments Business Payments Total Balance at December 31, 2021 $ 743,608 $ 80,473 $ 824,081 Measurement period adjustment 3,732 — 3,732 Reallocation ( 138,201 ) 138,201 — Balance at December 31, 2022 $ 609,139 $ 218,674 $ 827,813 Dispositions ( 35,270 ) — ( 35,270 ) Impairments — ( 75,750 ) ( 75,750 ) Balance at December 31, 2023 $ 573,869 $ 142,924 $ 716,793 |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Borrowings under Credit Agreement | The following table summarizes the total borrowings under the Amended Credit Agreement and 2026 Notes: ($ in thousands) December 31, 2023 December 31, 2022 Non-current indebtedness: Revolving Credit Facility (1) $ — $ 20,000 Convertible Senior Debt 440,000 440,000 Total borrowings 440,000 460,000 Less: Long-term loan debt issuance cost (2) 5,834 8,681 Total non-current borrowings $ 434,166 $ 451,319 (1) The revolving credit facility bears interest at variable rates, which were 6.63 % as of December 31, 2022 . (2) The Company incurred $ 2.8 million, $ 2.8 million and $ 2.5 million of interest expense for the amortization of deferred debt issuance costs for the years ended December 31, 2023, 2022 and 2021 , respectively. |
Summary of Principal Maturities of Borrowings Outstanding | Following is a summary of principal maturities of borrowings outstanding as of December 31, 2023 for each of the next five years ending December 31 and in the aggregate: ($ in thousands) 2024 $ — 2025 — 2026 440,000 2027 — 2028 — $ 440,000 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Components of Lease Cost | The components of lease costs are presented in the following table: Year Ended December 31, ($ in thousands) 2023 2022 2021 Components of total lease costs: Operating lease costs $ 2,378 $ 2,678 $ 2,370 Short-term lease costs 30 52 101 Variable lease costs — — — Total lease costs $ 2,408 $ 2,730 $ 2,471 |
Schedule of Operating Lease and Supplemental Information | Amounts reported in the Consolidated Balance Sheets were as follows: ($ in thousands) December 31, 2023 December 31, 2022 Operating Leases: Right-of-use assets $ 8,023 $ 9,847 Lease liability, current 1,629 2,263 Lease liability, long-term 7,247 8,295 Total lease liabilities $ 8,876 $ 10,558 Weighted-average remaining lease term (in years) 4.3 4.7 Weighted-average discount rate (annualized) 5.8 % 4.5 % |
Summary of Other Information Related to Lease | Other information related to leases are as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 2,312 $ 2,592 $ 2,169 Right-of-use assets obtained in exchange for lease liabilities: Operating leases — 2,511 2,438 |
Schedule of Maturity Analysis of the Company's Operating Leases Liabilities | The following table presents a maturity analysis of the Company’s operating leases liabilities as of December 31, 2023: ($ in thousands) 2024 $ 2,084 2025 2,056 2026 2,019 2027 1,213 2028 734 Thereafter 2,808 Total undiscounted lease payments 10,914 Less: Imputed interest 2,038 Total lease liabilities $ 8,876 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Payables | Related party payables consisted of the following: December 31, December 31, ($ in thousands) 2023 2022 CPS accrued earnout liability $ — $ 1,000 Other payables to related parties — — $ — $ 1,000 |
Share Based Compensation (Table
Share Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share Based Compensation Expense and Related Income Tax Benefit | The following table summarized share-based compensation expense and the related income tax benefit recognized for the Company’s share-based compensation awards: Year Ended December 31, ($ in millions) 2023 2022 2021 Share-based compensation expense $ 22.2 $ 20.3 $ 22.3 Income tax benefit 1.7 2.1 3.4 |
Schedule of Outstanding Performance Stock Units Activity, Restricted Stock Awards, Restricted Stock Units and Performance-based Stock Options | Activity for RSAs for the year ended December 31, 2023 was as follows: Class A Common Stock Weighted Average Grant Date Fair Value Unvested at December 31, 2022 2,111,635 $ 16.23 Granted 2,727,476 6.28 Forfeited (1) 593,411 12.78 Vested 695,335 15.75 Unvested at December 31, 2023 3,550,365 9.26 Activity for RSUs for the year ended December 31, 2023 was as follows: Class A Common Stock Weighted Average Grant Date Fair Value Unvested at December 31, 2022 108,909 $ 13.22 Granted 171,384 7.41 Forfeited — — Vested 108,909 13.22 Unvested at December 31, 2023 171,384 7.41 (1) The forfeited shares include shares forfeited as a result of employee terminations and shares withheld to satisfy employees’ tax withholding and payment obligations in connection with the vesting of restricted stock awards under the Incentive Plan during the year ended December 31, 2023 ; further, these forfeited shares are added back to the amount of shares available for grant under the Incentive Plan. Activity for PSUs for the year ended December 31, 2023 was as follows: Class A Common Stock (1) Weighted Average Grant Date Fair Value Unvested at December 31, 2022 634,023 $ 19.19 Granted 1,102,497 8.87 Forfeited 253,729 22.88 Vested — — Unvested at December 31, 2023 1,482,791 10.88 (1) Represent shares to be paid out at 100 % target level. Activity for PSOs for the year ended December 31, 2023 was as follows: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2022 — $ — — $ — Granted 1,148,822 6.13 Forfeited — — Exercised — — Outstanding at December 31, 2023 1,148,822 $ 6.13 7.0 $ 2,768,661 Options vested and exercisable at December 31, 2023 — $ — — $ — |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | Fair value was estimated on the date of grant using Monte Carlo simulation with the following weighted average assumptions: Year Ended December 31, 2023 Risk-free interest rate 3.42 % Expected volatility 52.82 % Dividend yield 0 % Expected term (in years) 4.5 |
Taxation (Tables)
Taxation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Loss Before Income Taxes | The components of loss before income taxes are as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Domestic $ ( 121,593 ) $ 13,305 $ ( 87,353 ) Foreign 2,058 1,610 625 Income (loss) before income tax expense (benefit) $ ( 119,535 ) $ 14,915 $ ( 86,728 ) |
Schedule of Provision for Income Tax | The Company recorded a provision for income tax as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Current expense Federal $ 591 $ 1,300 $ 35 State 332 263 2 Foreign 556 419 — Total current expense $ 1,479 $ 1,982 $ 37 Deferred expense Federal $ ( 1,858 ) $ 1,421 $ ( 18,113 ) State ( 1,736 ) 2,755 ( 12,800 ) Foreign — 16 185 Total deferred expense (benefit) ( 3,594 ) 4,192 ( 30,728 ) Income tax expense (benefit) $ ( 2,115 ) $ 6,174 $ ( 30,691 ) |
Schedule of Reconciliation of United States Statutory Income Tax Rate to Effective Income Tax Rate | A reconciliation of the United States statutory income tax rate to the Company’s effective income tax rate is as follows for the years indicated: Year Ended December 31, 2023 2022 2021 Federal income tax expense 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 0.1 % 0.8 % 5.2 % Income attributable to noncontrolling interest ( 1.3 %) 5.8 % ( 1.4 %) Excess tax shortfall related to share-based compensation ( 1.9 %) 5.6 % 0.6 % Business disposition ( 6.2 %) 0.0 % 0.0 % Goodwill impairment ( 12.3 %) 0.0 % 0.0 % Change in fair value of contingent consideration 0.0 % ( 4.0 %) 0.0 % Foreign rate differential ( 0.3 %) 1.4 % 0.0 % R&D credit - Federal 1.1 % ( 4.8 %) 0.0 % Provision to return - Federal 0.5 % ( 3.8 %) 0.0 % State rate change impact on deferred taxes 1.2 % 19.0 % 9.5 % Other, net ( 0.1 %) 0.5 % 0.5 % Effective tax rate 1.8 % 41.4 % 35.4 % |
Schedule of Deferred Tax Assets and Liabilities | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Details of the Company’s deferred tax assets and liabilities are as follows: ($ in thousands) December 31, 2023 December 31, 2022 Deferred tax assets Tax Credits $ 4,720 $ 3,140 Section 163(j) Limitation Carryover — 354 Acquisition Costs 289 313 Federal Net Operating Losses 26,988 31,160 State Net Operating Losses 5,604 6,308 Foreign Net Operating Losses — — Other Assets ( 12 ) 66 Partnership basis tax differences 134,422 126,806 Total deferred tax asset 172,011 168,147 Valuation allowance ( 11,924 ) ( 15,468 ) Total deferred tax asset, net of valuation allowance 160,087 152,679 Deferred tax liabilities Other intangibles - Payix ( 4,679 ) ( 6,230 ) Other liabilities ( 8,536 ) ( 10,079 ) Total deferred tax liabilities ( 13,215 ) ( 16,309 ) Net deferred tax assets $ 146,872 $ 136,370 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Gross Profit for Each Reportable Segment | The following table presents revenue and gross profit for each reportable segment. Year Ended December 31, ($ in thousand) 2023 2022 2021 Revenue Consumer Payments $ 275,708 $ 248,191 $ 194,044 Business Payments 38,058 42,600 33,818 Elimination of intersegment revenues (1) ( 17,139 ) ( 11,564 ) ( 8,604 ) Total revenue $ 296,627 $ 279,227 $ 219,258 Gross profit (2) Consumer Payments $ 216,096 $ 195,542 $ 148,614 Business Payments 27,967 30,423 23,764 Elimination of intersegment revenues ( 17,139 ) ( 11,564 ) ( 8,604 ) Total gross profit $ 226,924 $ 214,401 $ 163,774 Total other operating expenses (3) $ 338,337 $ 261,602 $ 217,771 Total other income (expense) ( 8,122 ) 62,116 ( 32,731 ) Income (loss) before income tax benefit (expense) ( 119,535 ) 14,915 ( 86,728 ) Income tax benefit (expense) 2,115 ( 6,174 ) 30,691 Net income (loss) $ ( 117,420 ) $ 8,741 $ ( 56,037 ) (1) Represents intercompany eliminations between segments for consolidation purpose. (2) Represents revenue less costs of services. (3) Represents total operating expenses less costs of services (exclusive of depreciation and amortization). |
Organizational Structure and _2
Organizational Structure and Corporate Information - Additional Information (Details) $ in Thousands | 12 Months Ended | |
Feb. 15, 2023 USD ($) | Dec. 31, 2023 USD ($) Segment | |
Summary Of Significant Accounting Policies [Line Items] | ||
Number of reportable segments | Segment | 2 | |
Consumer payments segments percentage of revenue | 87% | |
Cash proceeds from sale of business | $ 40,273 | |
Business payments segments percentage of revenue | 13% | |
Loss on business disposition | $ 10,027 | |
Purchase of intangible assets | 13,600 | |
Blue Cow Software | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Cash proceeds from sale of business | $ 41,900 | |
Loss on business disposition | (10,000) | $ (10,000) |
Consumer Payments | Blue Cow Software | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Cash proceeds from sale of business | $ 41,900 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | |||||
Sep. 27, 2023 USD ($) Sublease | Dec. 31, 2023 USD ($) Segment Merchant Sublease shares | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jun. 08, 2022 shares | Jul. 11, 2019 shares | |
Summary Of Significant Accounting Policies [Line Items] | ||||||
Number of operating segment | Segment | 2 | |||||
Number of reportable segments | Segment | 2 | |||||
Number of merchant represents greater than 10% of volume or profit basis | Merchant | 0 | |||||
Intangible assets, estimated useful life | 4 years 8 months 4 days | 5 years 8 months 15 days | ||||
Impairment of intangible assets | $ 0 | $ 0 | $ 0 | |||
Losses associated with the company's short term investments | 0 | 0 | 0 | |||
Cash available for general purposes | 118,100,000 | 64,900,000 | ||||
Net loss attributable to noncontrolling interest | 6,930,000 | 4,095,000 | 5,953,000 | |||
Impairment loss | $ 75,800,000 | $ 8,090,000 | $ 2,180,000 | |||
Number of operating lease subleased | Sublease | 1 | 1 | ||||
Accrued Expenses | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
IBNR reserve | $ 900,000 | |||||
Consumer Payments | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment loss on operating lease | $ 100,000 | 100,000 | ||||
Business Payments | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Non-cash impairment loss | $ 75,700,000 | |||||
Hawk Parent Holdings LLC | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Noncontrolling interest, ownership percentage | 94.20% | 92% | 91.90% | |||
Net loss attributable to noncontrolling interest | $ 6,900,000 | $ 4,100,000 | $ 6,000,000 | |||
Incentive Plan | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Common stock reserved for future issuance | shares | 13,826,728 | 7,326,728 | ||||
Incentive Plan | Class A Common Stock | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Common stock reserved for future issuance | shares | 2,137,122 | |||||
Selling, General and Administrative Expenses | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Transaction costs | $ 3,400,000 | $ 13,700,000 | 9,300,000 | |||
Purchased Software | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 9 months 29 days | 11 months 26 days | ||||
Channel Relationships | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 8 years 4 months 20 days | 8 years 21 days | ||||
Client Relationships | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 6 years 3 months 25 days | 7 years 4 months 24 days | ||||
Trade Names | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of intangible assets | $ 100,000 | $ 8,100,000 | 2,200,000 | |||
Trade Names | Consumer Payments | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of intangible assets | 8,100,000 | 1,000,000 | ||||
Trade Names | Business Payments | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of intangible assets | 0 | 1,200,000 | ||||
Trade Names | TriSource, APS, Ventanex, cPayPlus and CPS | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of intangible assets | $ 2,200,000 | |||||
Trade Names | BillingTree, Kontrol and Payix | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of intangible assets | $ 8,100,000 | |||||
Trade Names | Media Payments | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of intangible assets | $ 100,000 | |||||
Maximum | Software Development Costs | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 3 years | |||||
Maximum | Purchased Software | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 3 years | |||||
Maximum | Channel Relationships | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 10 years | |||||
Maximum | Client Relationships | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Intangible assets, estimated useful life | 10 years | |||||
Financial Institutions | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Percentage of cash and cash equivalents held | 82% | |||||
Volume or Profit Basis | Customer Concentration Risk | Minimum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Concentration risk, percentage | 10% |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Estimated Useful Life of Property and Equipment (Details) | Dec. 31, 2023 |
Furniture, Fixtures, and Office Equipment | |
Summary Of Significant Accounting Policies [Line Items] | |
Estimated Useful Life | 5 years |
Computers | |
Summary Of Significant Accounting Policies [Line Items] | |
Estimated Useful Life | 3 years |
Leasehold Improvements | Maximum | |
Summary Of Significant Accounting Policies [Line Items] | |
Estimated Useful Life | 5 years |
Revenue - Summary of Disaggrega
Revenue - Summary of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Revenue | ||||
Total Revenue | $ 296,627 | $ 279,227 | $ 219,258 | |
Operating Segments | Consumer Payments | ||||
Revenue | ||||
Total Revenue | 275,708 | 248,191 | 194,044 | |
Operating Segments | Business Payments | ||||
Revenue | ||||
Total Revenue | 38,058 | 42,600 | 33,818 | |
Elimination of Intersegment Revenues | ||||
Revenue | ||||
Total Revenue | [1] | (17,139) | (11,564) | (8,604) |
Direct Relationships | ||||
Revenue | ||||
Total Revenue | 283,414 | 264,951 | 213,252 | |
Direct Relationships | Operating Segments | Consumer Payments | ||||
Revenue | ||||
Total Revenue | 263,564 | 234,905 | 189,019 | |
Direct Relationships | Operating Segments | Business Payments | ||||
Revenue | ||||
Total Revenue | 36,989 | 41,610 | 32,837 | |
Direct Relationships | Elimination of Intersegment Revenues | ||||
Revenue | ||||
Total Revenue | (17,139) | (11,564) | (8,604) | |
Indirect Relationships | ||||
Revenue | ||||
Total Revenue | 13,213 | 14,276 | 6,006 | |
Indirect Relationships | Operating Segments | Consumer Payments | ||||
Revenue | ||||
Total Revenue | 12,144 | 13,286 | 5,025 | |
Indirect Relationships | Operating Segments | Business Payments | ||||
Revenue | ||||
Total Revenue | $ 1,069 | $ 990 | $ 981 | |
[1] Represents intercompany eliminations between segments for consolidation purpose. |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Contract asset | $ 1.4 | $ 0.5 |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Net Income (Loss) and Weighted Average Basic and Diluted Shares Outstanding (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income (loss) before income tax expense | $ (119,535) | $ 14,915 | $ (86,728) |
Less: Net loss attributable to non-controlling interests | (6,930) | (4,095) | (5,953) |
Income tax (expense) benefit | 2,115 | (6,174) | 30,691 |
Net income (loss) attributable to the Company | $ (110,490) | $ 12,836 | $ (50,084) |
Weighted average shares of Class A common stock outstanding - basic | 90,048,638 | 88,792,453 | 83,318,189 |
Add weighted average effect of dilutive common stock equivalent shares: | |||
Weighted average shares of Class A common stock outstanding - diluted | 90,048,638 | 110,671,731 | 83,318,189 |
Income (loss) per share of Class A common stock outstanding - basic | $ (1.23) | $ 0.14 | $ (0.6) |
Income (loss) per share of Class A common stock outstanding - diluted | $ (1.23) | $ 0.12 | $ (0.6) |
Class A Common Stock | |||
Weighted average shares of Class A common stock outstanding - basic | 90,048,638 | 88,792,453 | 83,318,189 |
Add weighted average effect of dilutive common stock equivalent shares: | |||
Post-Merger Repay Units exchangeable for Class A common stock | 7,892,176 | ||
Unvested share-based awards of Class A common stock | 890,309 | ||
Outstanding ESPP purchase rights for Class A common stock | 1,554 | ||
2026 Notes convertible into Class A common stock | 13,095,238 | ||
Weighted average shares of Class A common stock outstanding - diluted | 90,048,638 | 110,671,731 | 83,318,189 |
Income (loss) per share of Class A common stock outstanding - basic | $ (1.23) | $ 0.14 | $ (0.6) |
Income (loss) per share of Class A common stock outstanding - diluted | $ (1.23) | $ 0.12 | $ (0.6) |
Earnings Per Share - Summary _2
Earnings Per Share - Summary of Components of Common Stock Equivalent Shares Excluded from Computation of Diluted Loss per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2021 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share equivalents excluded from earnings (loss) per share | 25,292,695 | 23,537,448 |
Class A Common Stock | Post-Merger Repay Units Exchangeable | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share equivalents excluded from earnings (loss) per share | 5,844,095 | 7,926,576 |
Class A Common Stock | Unvested Share-based Awards | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share equivalents excluded from earnings (loss) per share | 5,204,540 | 2,515,634 |
Class A Common Stock | Outstanding Stock Options | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share equivalents excluded from earnings (loss) per share | 1,148,822 | |
Class A Common Stock | 2026 Notes Convertible | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share equivalents excluded from earnings (loss) per share | 13,095,238 | 13,095,238 |
Business Combinations and Dis_3
Business Combinations and Dispositions - Additional Information (Details) - USD ($) | 12 Months Ended | ||||||
Feb. 15, 2023 | Dec. 29, 2021 | Jun. 22, 2021 | Jun. 15, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 716,793,000 | $ 827,813,000 | $ 824,081,000 | ||||
Payments made to acquire business | 8,896,000 | 1,500,000 | |||||
Cash proceeds from sale of business | 40,273,000 | ||||||
Loss on business disposition | 10,027,000 | ||||||
Revenue | 296,627,000 | 279,227,000 | $ 219,258,000 | ||||
Blue Cow Software | |||||||
Business Acquisition [Line Items] | |||||||
Cash proceeds from sale of business | $ 41,900,000 | ||||||
Loss on business disposition | $ (10,000,000) | (10,000,000) | |||||
Consumer Payments Segment | Blue Cow Software | |||||||
Business Acquisition [Line Items] | |||||||
Dispositions | 35,300,000 | ||||||
Revenue | $ 1,200,000 | $ 9,800,000 | |||||
Billing Tree | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 297,520,000 | ||||||
Goodwill expected to be deductible for tax purposes | 66,500,000 | ||||||
Cash consideration | 277,521,000 | ||||||
Payments made to acquire business | $ 505,771,000 | ||||||
Billing Tree | Consumer Payments Segment | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill allocation percentage | 100% | ||||||
Kontrol | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 1,590,000 | ||||||
Goodwill expected to be deductible for tax purposes | 1,100,000 | ||||||
Cash consideration | 7,439,000 | ||||||
Contingent earn-out right to be received | 3,000,000 | ||||||
Payments made to acquire business | 7,939,000 | ||||||
Kontrol | Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Contingent earn-out right to be received | $ 10,500,000 | ||||||
Kontrol | Business Payments Segment | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill allocation percentage | 100% | ||||||
Payix | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 71,231,000 | ||||||
Goodwill expected to be deductible for tax purposes | 0 | ||||||
Cash consideration | 95,628,000 | ||||||
Contingent earn-out right to be received | 20,000,000 | ||||||
Payments made to acquire business | 98,478,000 | ||||||
Payix | Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Contingent earn-out right to be received | $ 20,000,000 | ||||||
Payix | Consumer Payments Segment | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill allocation percentage | 100% | ||||||
Class A Common Stock | Billing Tree | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, stock transaction | $ 10,000,000 |
Business Combinations and Dis_4
Business Combinations and Dispositions - Summary of Preliminary Purchase Consideration (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 29, 2021 | Jun. 22, 2021 | Jun. 15, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Business Acquisition [Line Items] | ||||||
Total purchase price | $ 8,896 | $ 1,500 | ||||
Billing Tree | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration | $ 277,521 | |||||
Class A common stock issued | 228,250 | |||||
Total purchase price | $ 505,771 | |||||
Kontrol | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration | $ 7,439 | |||||
Contingent consideration | [1] | 500 | ||||
Total purchase price | $ 7,939 | |||||
Payix | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration | $ 95,628 | |||||
Contingent consideration | [2] | 2,850 | ||||
Total purchase price | $ 98,478 | |||||
[1] Reflects the fair value of the Kontrol earnout payment, the contingent consideration to be paid to the selling members of Kontrol, pursuant to the Kontrol Purchase Agreement as of June 22, 2021. The selling partners of Kontrol will have the contingent earnout right to receive a payment of up to $ 3.0 million, dependent upon the Gross Profit, as defined in the Kontr ol Purchase Agreement. As of December 31, 2022, the fair value of the Kontrol earnout was $ 0 , which resulted in a ($ 0.9 ) million a djustment included in the change in fair value of contingent consideration in the Consolidated Statements of Operations for the year ended December 31, 2022. Reflects the fair value of the Payix earnout payment, the contingent consideration to be paid to the former owners of Payix, pursuant to the Payix Purchase Agreement as of December 31, 2021. The former owners of Payix will have the contingent earnout right to receive a payment of up to $ 20.0 million, dependent upon the Gross Profit, as defined in the Payix Purchase Agreement. As of December 31, 2022, the fair value of the Payix earnout was $ 0 , which resulted in a ($ 2.9 ) million ad justment included in the change in fair value of contingent consideration in the Consolidated Statements of Operations for the year ended December 31, 2022. |
Business Combinations and Dis_5
Business Combinations and Dispositions - Summary of Preliminary Purchase Consideration (Parenthetical) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 29, 2021 | Jun. 22, 2021 | |
Kontrol | |||
Business Acquisition [Line Items] | |||
Contingent earn-out right to be received | $ 3,000,000 | ||
Earnout payment | $ 0 | ||
Adjustment included in change in fair value of contingent consideration | (900,000) | ||
Kontrol | Maximum | |||
Business Acquisition [Line Items] | |||
Contingent earn-out right to be received | $ 10,500,000 | ||
Payix | |||
Business Acquisition [Line Items] | |||
Contingent earn-out right to be received | $ 20,000,000 | ||
Earnout payment | 0 | ||
Adjustment included in change in fair value of contingent consideration | $ (2,900,000) | ||
Payix | Maximum | |||
Business Acquisition [Line Items] | |||
Contingent earn-out right to be received | $ 20,000,000 |
Business Combinations and Dis_6
Business Combinations and Dispositions - Summary of Preliminary and Final Purchase Allocation (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 29, 2021 | Jun. 22, 2021 | Jun. 15, 2021 |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 716,793 | $ 827,813 | $ 824,081 | |||
Billing Tree | ||||||
Business Acquisition [Line Items] | ||||||
Cash and cash equivalents | $ 8,244 | |||||
Accounts receivable | 4,627 | |||||
Prepaid expenses and other current assets | 1,602 | |||||
Total current assets | 14,473 | |||||
Property, plant and equipment, net | 541 | |||||
Restricted cash | 275 | |||||
Other assets | 1,782 | |||||
Identifiable intangible assets | 236,810 | |||||
Total identifiable assets acquired | 253,881 | |||||
Accounts payable | (2,552) | |||||
Accrued expenses and other liabilities | (6,983) | |||||
Deferred tax liability | (36,095) | |||||
Net identifiable assets acquired | 208,251 | |||||
Goodwill | 297,520 | |||||
Total purchase price | $ 505,771 | |||||
Kontrol | ||||||
Business Acquisition [Line Items] | ||||||
Accounts receivable | $ 68 | |||||
Prepaid expenses and other current assets | 6 | |||||
Total current assets | 74 | |||||
Identifiable intangible assets | 6,940 | |||||
Total identifiable assets acquired | 7,014 | |||||
Accounts payable | (665) | |||||
Net identifiable assets acquired | 6,349 | |||||
Goodwill | 1,590 | |||||
Total purchase price | $ 7,939 | |||||
Payix | ||||||
Business Acquisition [Line Items] | ||||||
Cash and cash equivalents | $ 703 | |||||
Accounts receivable | 1,715 | |||||
Prepaid expenses and other current assets | 94 | |||||
Total current assets | 2,512 | |||||
Property, plant and equipment, net | 83 | |||||
Restricted cash | 27 | |||||
Other assets | 656 | |||||
Identifiable intangible assets | 33,150 | |||||
Total identifiable assets acquired | 36,428 | |||||
Accounts payable | (214) | |||||
Accrued expenses and other liabilities | (2,023) | |||||
Deferred tax liability | (6,944) | |||||
Net identifiable assets acquired | 27,247 | |||||
Goodwill | 71,231 | |||||
Total purchase price | $ 98,478 |
Business Combinations and Dis_7
Business Combinations and Dispositions - Summary of Preliminary Values Allocated to Identifiable Intangible Assets and Estimated Useful Lives (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 29, 2021 | Jun. 22, 2021 | Jun. 15, 2021 | Dec. 31, 2023 | |
Billing Tree | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, fair value | $ 236,810 | |||
Billing Tree | Trade Names | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life, description | Indefinite | |||
Identifiable intangible assets, fair value | $ 7,800 | |||
Billing Tree | Non-Complete Agreements | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life | 2 years | |||
Identifiable intangible assets, fair value | $ 300 | |||
Billing Tree | Developed Technology | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life | 3 years | |||
Identifiable intangible assets, fair value | $ 26,200 | |||
Billing Tree | Merchant Relationships | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life | 10 years | |||
Identifiable intangible assets, fair value | $ 202,500 | |||
Kontrol | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, fair value | $ 6,940 | |||
Kontrol | Trade Names | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life, description | Indefinite | |||
Identifiable intangible assets, fair value | $ 0 | |||
Kontrol | Merchant Relationships | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life | 8 years | |||
Identifiable intangible assets, fair value | $ 6,900 | |||
Payix | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, fair value | $ 33,150 | |||
Payix | Trade Names | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life, description | Indefinite | |||
Identifiable intangible assets, fair value | $ 300 | |||
Payix | Developed Technology | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life | 3 years | |||
Identifiable intangible assets, fair value | $ 12,400 | |||
Payix | Merchant Relationships | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, useful life | 10 years | |||
Identifiable intangible assets, fair value | $ 20,500 |
Business Combinations and Dis_8
Business Combinations and Dispositions - Summary of Pro Forma Financial Information (Details) - Ventanex, cPayPlus, CPS, BillingTree, Kontrol and Payix Acquisitions $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) $ / shares | |
Business Acquisition [Line Items] | |
Revenue | $ 257,014 |
Net loss | (54,627) |
Net loss attributable to non-controlling interests | (5,813) |
Net loss attributable to the Company | $ (48,814) |
Class A Share | |
Business Acquisition [Line Items] | |
Loss per Class A share - basic | $ / shares | $ (0.56) |
Loss per Class A share - diluted | $ / shares | $ (0.56) |
Fair Value of Assets and Liab_3
Fair Value of Assets and Liabilities - Summary of Carrying Amounts and Estimated Fair Values of Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Assets: | ||
Cash and cash equivalents | $ 118,096 | $ 64,895 |
Other assets | 2,500 | 2,500 |
Total assets | 120,596 | 67,395 |
Liabilities: | ||
Contingent consideration | 1,000 | |
Borrowings | 375,650 | 344,280 |
Tax receivable agreement | 188,911 | 179,127 |
Total liabilities | 564,561 | 524,407 |
Level 1 | ||
Assets: | ||
Cash and cash equivalents | 118,096 | 64,895 |
Total assets | 118,096 | 64,895 |
Level 2 | ||
Assets: | ||
Other assets | 2,500 | 2,500 |
Total assets | 2,500 | 2,500 |
Liabilities: | ||
Borrowings | 375,650 | 344,280 |
Total liabilities | 375,650 | 344,280 |
Level 3 | ||
Liabilities: | ||
Contingent consideration | 1,000 | |
Tax receivable agreement | 188,911 | 179,127 |
Total liabilities | $ 188,911 | $ 180,127 |
Fair Value of Assets and Liab_4
Fair Value of Assets and Liabilities - Schedule of Contingent Consideration Related to Previous Business Acquisitions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Contingent Consideration | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Balance at beginning of period | $ 1,000 | $ 17,047 | |
Payments | (1,000) | (12,747) | |
Valuation adjustment | (3,300) | ||
Balance at end of period | 1,000 | $ 17,047 | |
Tax Receivable Agreement | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Balance at beginning of period | 179,127 | 245,828 | 229,228 |
Purchases | 3,164 | 170 | 2,491 |
Accretion expense | 12,362 | 7,806 | 5,065 |
Valuation adjustment | (5,742) | (74,677) | 9,044 |
Balance at end of period | $ 188,911 | $ 179,127 | $ 245,828 |
Fair Value of Assets and Liab_5
Fair Value of Assets and Liabilities - Schedule of Carrying Value and Estimated Fair Value of Borrowings (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | $ 375,650 | $ 344,280 |
Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | 434,166 | 451,319 |
Carrying Value | 2026 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | 434,166 | 433,142 |
Carrying Value | Revolving Credit Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | 18,177 | |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | 375,650 | 344,280 |
Fair Value | 2026 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | $ 375,650 | 324,280 |
Fair Value | Revolving Credit Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Borrowings | $ 20,000 |
Fair Value of Assets and Liab_6
Fair Value of Assets and Liabilities - Additional Information (Details) - Tax Receivable Agreement $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2023 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
TRA, balance adjusted through accretion expense and valuation adjustment | $ (9.8) | |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Fair Value Change In Tax Receivable Liability | |
TRA, measurement input | 6.48 | 7.1 |
Alternative Investment, Valuation Technique [Extensible List] | us-gaap:ValuationTechniqueDiscountedCashFlowMember | |
Alternative Investment, Measurement Input [Extensible List] | us-gaap:MeasurementInputDiscountRateMember |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property Plant And Equipment [Line Items] | ||
Property,plant and equipment, gross | $ 10,381 | $ 9,562 |
Less: Accumulated depreciation and amortization | 7,248 | 5,187 |
Property, plant and equipment, net | 3,133 | 4,375 |
Furniture, Fixtures, and Office Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property,plant and equipment, gross | 4,905 | 4,014 |
Computers | ||
Property Plant And Equipment [Line Items] | ||
Property,plant and equipment, gross | 4,813 | 4,889 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property,plant and equipment, gross | $ 663 | $ 659 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 2.4 | $ 2.4 | $ 1.3 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) TradeName | Dec. 31, 2022 USD ($) TradeName | Dec. 31, 2021 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||
Number of trade names | TradeName | 1 | 2 | |
Amortization of Intangible Assets | $ 101,400,000 | $ 105,400,000 | $ 88,400,000 |
Impairment of intangible assets | 0 | 0 | 0 |
Trade Names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets | $ 100,000 | 8,100,000 | 2,200,000 |
Consumer Payments | Trade Names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets | 8,100,000 | 1,000,000 | |
Business Payments | Trade Names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets | $ 0 | $ 1,200,000 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 825,211 | $ 777,610 |
Accumulated Amortization | 378,070 | 277,035 |
Net Carrying Value | $ 447,141 | $ 500,575 |
Weighted Average Useful Life (Years) | 4 years 8 months 4 days | 5 years 8 months 15 days |
Client Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 523,850 | $ 539,850 |
Accumulated Amortization | 190,591 | 137,515 |
Net Carrying Value | $ 333,259 | $ 402,335 |
Weighted Average Useful Life (Years) | 6 years 3 months 25 days | 7 years 4 months 24 days |
Channel Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 29,785 | $ 16,240 |
Accumulated Amortization | 4,792 | 3,168 |
Net Carrying Value | $ 24,993 | $ 13,072 |
Weighted Average Useful Life (Years) | 8 years 4 months 20 days | 8 years 21 days |
Software Costs | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 246,996 | $ 196,890 |
Accumulated Amortization | 178,323 | 132,322 |
Net Carrying Value | $ 68,673 | $ 64,568 |
Weighted Average Useful Life (Years) | 9 months 29 days | 11 months 26 days |
Non-Complete Agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 4,580 | $ 4,580 |
Accumulated Amortization | 4,364 | 4,030 |
Net Carrying Value | $ 216 | $ 550 |
Weighted Average Useful Life (Years) | 2 months 23 days | 6 months 14 days |
Trade Names | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 20,000 | $ 20,050 |
Net Carrying Value | $ 20,000 | $ 20,050 |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Estimated Amortization Expense (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Estimated Future Amortization Expense | |
2024 | $ 78,505 |
2025 | 61,883 |
2026 | 46,918 |
2027 | 38,602 |
2028 | 38,146 |
Thereafter | $ 163,087 |
Goodwill - Additional Informati
Goodwill - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Line Items] | |||
Impairment | $ 75,750,000 | ||
Measurement period adjustment | $ 3,732,000 | ||
Goodwill reallocation between Consumer payments and business payments segments | 0 | ||
Blue Cow Software | |||
Goodwill [Line Items] | |||
Measurement period adjustment | 35,300,000 | ||
Billing Tree | |||
Goodwill [Line Items] | |||
Measurement period adjustment | 3,700,000 | ||
Measurement period adjustment due to change in deferred tax liability | 4,700,000 | ||
Measurement period adjustment due to change in accounts receivables | 1,000,000 | ||
Goodwill reallocation between Consumer payments and business payments segments | 138,200,000 | ||
Consumer Payments | |||
Goodwill [Line Items] | |||
Impairment | 0 | ||
Accumulated impairment losses | 0 | $ 0 | |
Measurement period adjustment | 3,732,000 | ||
Goodwill reallocation between Consumer payments and business payments segments | (138,201,000) | ||
Business Payments | |||
Goodwill [Line Items] | |||
Impairment | 75,750,000 | ||
Accumulated impairment losses | 75,700,000 | 0 | $ 0 |
Non-cash impairment loss | $ 75,700,000 | ||
Measurement period adjustment | 0 | ||
Goodwill reallocation between Consumer payments and business payments segments | $ 138,201,000 |
Goodwill - Schedule of Changes
Goodwill - Schedule of Changes to Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Goodwill [Line Items] | ||
Beginning balance | $ 827,813 | $ 824,081 |
Measurement period adjustment | 3,732 | |
Reallocation | 0 | |
Dispositions | (35,270) | |
Impairments | (75,750) | |
Ending balance | 716,793 | 827,813 |
Consumer Payments | ||
Goodwill [Line Items] | ||
Beginning balance | 609,139 | 743,608 |
Measurement period adjustment | 3,732 | |
Reallocation | (138,201) | |
Dispositions | (35,270) | |
Impairments | 0 | |
Ending balance | 573,869 | 609,139 |
Business Payments | ||
Goodwill [Line Items] | ||
Beginning balance | 218,674 | 80,473 |
Measurement period adjustment | 0 | |
Reallocation | 138,201 | |
Dispositions | 0 | |
Impairments | (75,750) | |
Ending balance | $ 142,924 | $ 218,674 |
Borrowings - Additional Informa
Borrowings - Additional Information (Details) | 12 Months Ended | |||||||
Feb. 28, 2023 USD ($) | Jan. 19, 2021 USD ($) $ / shares | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 29, 2021 USD ($) | Dec. 28, 2021 USD ($) | Feb. 03, 2021 USD ($) | Feb. 02, 2021 USD ($) | |
2026 Notes | Notes Offering | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 440,000,000 | |||||||
Debt instrument interest rate | 0% | |||||||
Debt instrument, maturity date | Feb. 01, 2026 | |||||||
2026 Notes | Notes Offering | Class A Common Stock | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, convertible notes, conversion rate | 29.7619 | |||||||
Debt instrument, convertible notes, conversion price per share | $ / shares | $ 33.6 | |||||||
Successor Credit Agreement | Senior Secured Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Undrawn line of credit | $ 30,000,000 | |||||||
New Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit | $ 0 | |||||||
Interest expense | $ 3,800,000 | $ 4,400,000 | ||||||
New Credit Agreement | Senior Secured Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit maximum borrowing capacity | $ 185,000,000 | $ 60,000,000 | ||||||
New Credit Agreement | Senior Secured Revolving Credit Facility | Truist Bank | ||||||||
Debt Instrument [Line Items] | ||||||||
Undrawn line of credit | $ 125,000,000 | |||||||
Revolving Loan | New Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Undrawn line of credit | $ 185,000,000 | |||||||
Line of credit facility repaid amount | $ 20,000,000 |
Borrowings - Summary of Borrowi
Borrowings - Summary of Borrowings under Credit Agreement (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||
Total borrowings | $ 440,000 | $ 460,000 | |
Less: Long-term loan debt issuance cost | [1] | 5,834 | 8,681 |
Total non-current borrowings | 434,166 | 451,319 | |
Convertible Senior Debt | |||
Debt Instrument [Line Items] | |||
Total borrowings | $ 440,000 | 440,000 | |
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Total borrowings | [2] | $ 20,000 | |
[1] The Company incurred $ 2.8 million, $ 2.8 million and $ 2.5 million of interest expense for the amortization of deferred debt issuance costs for the years ended December 31, 2023, 2022 and 2021 , respectively. The revolving credit facility bears interest at variable rates, which were 6.63 % as of December 31, 2022 . |
Borrowings - Summary of Borro_2
Borrowings - Summary of Borrowings under Credit Agreement (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||
Interest expense for the amortization of deferred debt issuance costs | $ 2,847 | $ 2,834 | $ 2,536 |
Interest Expense | |||
Debt Instrument [Line Items] | |||
Interest expense for the amortization of deferred debt issuance costs | $ 2,800 | $ 2,800 | $ 2,500 |
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Variable interest rate | 6.63% |
Borrowings - Summary of Princip
Borrowings - Summary of Principal Maturities of Borrowings Outstanding (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
2026 | $ 440,000 | |
Total borrowings | $ 440,000 | $ 460,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 12 Months Ended | |
Sep. 27, 2023 USD ($) Sublease | Dec. 31, 2023 USD ($) Sublease | |
Lease [Line Items] | ||
Operating lease expiration year | 2035 | |
Lessee, operating lease, existence of option to extend [true false] | true | |
Operating lease, option to extend | Most of these leases include one or more renewal options for six years or less | |
Operating lease, existence of option to terminate [true false] | true | |
Operating lease, option to terminate | certain leases also include lessee termination options | |
Number of operating lease subleased | Sublease | 1 | 1 |
Other (Loss) Income | ||
Lease [Line Items] | ||
Sublease income | $ 0.1 | |
Consumer Payments | ||
Lease [Line Items] | ||
Operating lease, impairment loss | $ 0.1 | $ 0.1 |
Minimum | ||
Lease [Line Items] | ||
Operating lease, term of contract | 3 years | |
Maximum | ||
Lease [Line Items] | ||
Operating lease, term of contract | 10 years | |
Operating lease, renewal term | 6 years |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Components of Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Components of total lease costs: | |||
Operating lease costs | $ 2,378 | $ 2,678 | $ 2,370 |
Short-term lease costs | 30 | 52 | 101 |
Total lease costs | $ 2,408 | $ 2,730 | $ 2,471 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Operating Lease and Supplemental Information (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Operating Leases: | ||
Right-of-use assets | $ 8,023 | $ 9,847 |
Lease liability, current | 1,629 | 2,263 |
Lease liability, long-term | 7,247 | 8,295 |
Total lease liabilities | $ 8,876 | $ 10,558 |
Weighted-average remaining lease term (in years) | 4 years 3 months 18 days | 4 years 8 months 12 days |
Weighted-average discount rate (annualized) | 5.80% | 4.50% |
Commitments and Contingencies_4
Commitments and Contingencies - Other Information Related to Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash flows from operating leases | $ 2,312 | $ 2,592 | $ 2,169 |
Right-of-use assets obtained in exchange for lease liabilities: | |||
Operating leases | $ 2,511 | $ 2,438 |
Commitments and Contingencies_5
Commitments and Contingencies - Schedule of Maturity Analysis of the Company's Operating Leases Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
2024 | $ 2,084 | |
2025 | 2,056 | |
2026 | 2,019 | |
2027 | 1,213 | |
2028 | 734 | |
Thereafter | 2,808 | |
Total undiscounted lease payments | 10,914 | |
Less: Imputed interest | 2,038 | |
Total lease liabilities | $ 8,876 | $ 10,558 |
Schedule of Related Party Payab
Schedule of Related Party Payables (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Related Party Transaction [Line Items] | |
Related party payable | $ 1,000 |
CPS | |
Related Party Transaction [Line Items] | |
Related party payable | $ 1,000 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||||
Transaction costs incurred on behalf of related parties | $ 5.4 | $ 10.6 | $ 8.2 | |
Other liabilities | $ 0 | $ 0 | ||
Other Liability, Related Party, Type [Extensible Enumeration] | us-gaap:RelatedPartyMember | us-gaap:RelatedPartyMember | ||
Related Parties | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable from related party | $ 0.1 | $ 0.3 | ||
CPS | ||||
Related Party Transaction [Line Items] | ||||
Contingent consideration payable to related parties | $ 0 | $ 1 | ||
Payment to related party | $ 1 |
Share Based Compensation - Addi
Share Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 08, 2022 | Jul. 11, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unrecognized compensation expense related to unvested PSUs, RSAs and RSUs | $ 24.9 | ||||
Weighted-average period related to unvested PSUs, RSAs, RSUs and PSOs | 1 year 10 months 9 days | ||||
Recognized compensation expense related to PSOs | $ 22.2 | $ 20.3 | $ 22.3 | ||
Dividend yield | 0% | ||||
Class A Common Stock | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Fair value vested related to PSUs, RSAs and RSUs | $ 8 | ||||
Performance based Stock Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Weighted-average period related to unvested PSUs, RSAs, RSUs and PSOs | 1 year 6 months 14 days | ||||
Recognized compensation expense related to PSOs | $ 1.4 | ||||
Unrecognized compensation expense related to PSOs | $ 1.6 | ||||
Weighted average grant date fair value, Granted | $ 2.61 | ||||
Employee Stock Option | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Expiration period | 7 years | ||||
Vesting, description | Stock options vest in three tranches, and each tranche may vest upon the later of (i) the date that the market value of the Company’s common stock for a period of twenty consecutive trading days exceeds a stock price goal and (ii) the corresponding time based service requirement. | ||||
Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock reserved for issuance | 13,826,728 | 7,326,728 | |||
Increased number of shares available for awards under incentive plan | 6,500,000 | ||||
Incentive Plan | Class A Common Stock | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock reserved for issuance | 2,137,122 |
Share Based Compensation - Sche
Share Based Compensation - Schedule of Share Based Compensation Expense and Related Income Tax Benefit (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Payment Arrangement [Abstract] | |||
Share-based compensation expense | $ 22.2 | $ 20.3 | $ 22.3 |
Income tax benefit | $ 1.7 | $ 2.1 | $ 3.4 |
Share Based Compensation - Sc_2
Share Based Compensation - Schedule of Outstanding Restricted Stock Awards Activity (Details) - Unvested Restricted Share Awards | 12 Months Ended | |
Dec. 31, 2023 $ / shares shares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Weighted average grant date fair value, Beginning Balance | $ / shares | $ 16.23 | |
Weighted average grant date fair value, Granted | $ / shares | 6.28 | |
Weighted average grant date fair value, Forfeited | $ / shares | 12.78 | [1] |
Weighted average grant date fair value, Vested | $ / shares | 15.75 | |
Weighted average grant date fair value, Ending Balance | $ / shares | $ 9.26 | |
Class A Common Stock | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unvested, Beginning Balance | shares | 2,111,635 | |
Granted | shares | 2,727,476 | |
Forfeited | shares | 593,411 | [1] |
Vested | shares | 695,335 | |
Unvested, Ending Balance | shares | 3,550,365 | |
[1] The forfeited shares include shares forfeited as a result of employee terminations and shares withheld to satisfy employees’ tax withholding and payment obligations in connection with the vesting of restricted stock awards under the Incentive Plan during the year ended December 31, 2023 ; further, these forfeited shares are added back to the amount of shares available for grant under the Incentive Plan. |
Share Based Compensation - Sc_3
Share Based Compensation - Schedule of Outstanding Restricted Stock Units Activity (Details) - Restricted Stock Units | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Weighted average grant date fair value, Beginning Balance | $ / shares | $ 13.22 |
Weighted average grant date fair value, Granted | $ / shares | 7.41 |
Weighted average grant date fair value, Vested | $ / shares | 13.22 |
Weighted average grant date fair value, Ending Balance | $ / shares | $ 7.41 |
Class A Common Stock | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unvested, Beginning Balance | shares | 108,909 |
Granted | shares | 171,384 |
Vested | shares | 108,909 |
Unvested, Ending Balance | shares | 171,384 |
Share Based Compensation - Sc_4
Share Based Compensation - Schedule of Outstanding Performance Stock Units Activity (Details) - Performance Stock Units | 12 Months Ended | |
Dec. 31, 2023 $ / shares shares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Weighted average grant date fair value, Beginning Balance | $ / shares | $ 19.19 | |
Weighted average grant date fair value, Granted | $ / shares | 8.87 | |
Weighted average grant date fair value, Forfeited | $ / shares | 22.88 | |
Weighted average grant date fair value, Ending Balance | $ / shares | $ 10.88 | |
Class A Share | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unvested, Beginning Balance | shares | 634,023 | [1] |
Granted | shares | 1,102,497 | [1] |
Forfeited | shares | 253,729 | [1] |
Unvested, Ending Balance | shares | 1,482,791 | [1] |
[1] Represent shares to be paid out at 100 % target level. |
Share Based Compensation - Sc_5
Share Based Compensation - Schedule of Outstanding Performance Stock Units Activity (Parenthetical) (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Class A Common Stock | Performance Stock Units | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Shares to be paid out at target level percentage | 100% |
Share Based Compensation - Sc_6
Share Based Compensation - Schedule of Outstanding Performance-based Stock Options (Details) - Performance based Stock Options | 12 Months Ended |
Dec. 31, 2023 USD ($) $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Granted | shares | 1,148,822 |
Outstanding ending balance | shares | 1,148,822 |
Weighted Average Exercise Price, Granted | $ / shares | $ 6.13 |
Weighted Average Exercise Price, Outstanding | $ / shares | $ 6.13 |
Weighted Average Remaining Contractual Term (in years), Outstanding | 7 years |
Aggregate Intrinsic Value, Outstanding | $ | $ 2,768,661 |
Share Based Compensation - Sc_7
Share Based Compensation - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Risk-free interest rate | 3.42% |
Expected volatility | 52.82% |
Dividend yield | 0% |
Expected term (in years) | 4 years 6 months |
Taxation - Schedule of Loss Bef
Taxation - Schedule of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (121,593) | $ 13,305 | $ (87,353) |
Foreign | 2,058 | 1,610 | 625 |
Income (loss) before income tax benefit (expense) | $ (119,535) | $ 14,915 | $ (86,728) |
Taxation - Schedule of Provisio
Taxation - Schedule of Provision for Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current expense | |||
Federal | $ 591 | $ 1,300 | $ 35 |
State | 332 | 263 | 2 |
Foreign | 556 | 419 | |
Total current expense | 1,479 | 1,982 | 37 |
Deferred expense | |||
Federal | (1,858) | 1,421 | (18,113) |
State | (1,736) | 2,755 | (12,800) |
Foreign | 16 | 185 | |
Total deferred expense (benefit) | (3,594) | 4,192 | (30,728) |
Income tax expense (benefit) | $ (2,115) | $ 6,174 | $ (30,691) |
Taxation - Schedule of Reconcil
Taxation - Schedule of Reconciliation of United States Statutory Income Tax Rate to Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax expense | 21% | 21% | 21% |
State taxes, net of federal benefit | 0.10% | 0.80% | 5.20% |
Income attributable to noncontrolling interest | (1.30%) | 5.80% | (1.40%) |
Excess tax shortfall related to share-based compensation | (1.90%) | 5.60% | 0.60% |
Business disposition | (6.20%) | 0% | 0% |
Goodwill impairment | (12.30%) | 0% | 0% |
Change in fair value of contingent consideration | 0% | (4.00%) | 0% |
Foreign rate differential | (0.30%) | 1.40% | 0% |
R&D credit - Federal | 1.10% | (4.80%) | 0% |
Provision to return - Federal | 0.50% | (3.80%) | 0% |
State rate change impact on deferred taxes | 1.20% | 19% | 9.50% |
Other, net | (0.10%) | 0.50% | 0.50% |
Effective tax rate | 1.80% | 41.40% | 35.40% |
Taxation - Additional Informati
Taxation - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Jul. 11, 2019 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Taxation [Line Items] | ||||
Effective tax rate | 1.80% | 41.40% | 35.40% | |
U.S. statutory tax rate | 21% | 21% | 21% | |
Reduction of deferred tax asset (DTA) and offsetting deferred tax liability (DTL) amount | $ 3,800,000 | $ 900,000 | ||
Deferred tax asset and offsetting deferred tax liability | $ 146,872,000 | $ 136,370,000 | ||
Valuation allowance recognized, percentage | 100% | |||
Federal net operating loss carryforwards expiration year | 2039 | |||
State net operating loss carryforwards expiration year | 2032 | |||
Valuation allowance recorded | $ 0 | |||
Uncertain tax positions | 0 | |||
Percentage of tax benefits payable under Tax Receivable Agreement | 100% | |||
Liability related to projected obligations under Tax Receivable Agreement | 188,900,000 | |||
Increase in TRA Liability | 9,800,000 | |||
Expiration Year 1 | ||||
Taxation [Line Items] | ||||
Net operating loss carryforwards with finite life | $ 3,300,000 | |||
Net operating loss carryforwards expiration year | 2034 | |||
Expiration Year 2 | ||||
Taxation [Line Items] | ||||
Net operating loss carryforwards with finite life | $ 100,000 | |||
Net operating loss carryforwards expiration year | 2028 | |||
Federal and State | ||||
Taxation [Line Items] | ||||
Net operating loss carryforwards | $ 32,600,000 | |||
Operating loss carryforwards with indefinite life | 29,100,000 | |||
Federal | ||||
Taxation [Line Items] | ||||
Net operating loss carryforwards | 3,600,000 | |||
State | ||||
Taxation [Line Items] | ||||
Net operating loss carryforwards | $ 1,100,000 |
Taxation - Schedule of Deferred
Taxation - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets | ||
Tax Credits | $ 4,720 | $ 3,140 |
Section 163(j) Limitation Carryover | 354 | |
Acquisition Costs | 289 | 313 |
Federal Net Operating Losses | 26,988 | 31,160 |
State Net Operating Losses | 5,604 | 6,308 |
Other Assets | (12) | 66 |
Partnership basis tax differences | 134,422 | 126,806 |
Total deferred tax asset | 172,011 | 168,147 |
Valuation allowance | (11,924) | (15,468) |
Total deferred tax asset, net of valuation allowance | 160,087 | 152,679 |
Deferred tax liabilities | ||
Other liabilities | (8,536) | (10,079) |
Total deferred tax liabilities | (13,215) | (16,309) |
Net deferred tax assets | 146,872 | 136,370 |
Payix | ||
Deferred tax liabilities | ||
Other intangibles - Payix | $ (4,679) | $ (6,230) |
Segments - Additional Informati
Segments - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of operating segment | 2 |
Number of reportable segments | 2 |
Segments - Schedule of Revenue
Segments - Schedule of Revenue and Gross Profit for Each Reportable Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Segment Reporting Information [Line Items] | ||||
Total Revenue | $ 296,627 | $ 279,227 | $ 219,258 | |
Total gross profit | [1] | 226,924 | 214,401 | 163,774 |
Total other operating expenses | [2] | 338,337 | 261,602 | 217,771 |
Total other income (expense) | (8,122) | 62,116 | (32,731) | |
Income (loss) before income tax benefit (expense) | (119,535) | 14,915 | (86,728) | |
Income tax benefit (expense) | 2,115 | (6,174) | 30,691 | |
Net income (loss) | (117,420) | 8,741 | (56,037) | |
Intersegment Elimination | ||||
Segment Reporting Information [Line Items] | ||||
Total Revenue | [3] | (17,139) | (11,564) | (8,604) |
Total gross profit | [1] | (17,139) | (11,564) | (8,604) |
Consumer Payments | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total Revenue | 275,708 | 248,191 | 194,044 | |
Total gross profit | [1] | 216,096 | 195,542 | 148,614 |
Business Payments | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total Revenue | 38,058 | 42,600 | 33,818 | |
Total gross profit | [1] | $ 27,967 | $ 30,423 | $ 23,764 |
[1] Represents revenue less costs of services. Represents total operating expenses less costs of services (exclusive of depreciation and amortization). Represents intercompany eliminations between segments for consolidation purpose. |