Flywire Corporation

Thank you for standing by. This is the conference operator. Welcome to the Flywire Corporation third quarter 2021 earnings call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and 0. I would now like to turn the conference over to Akhil Hollis, VP Financial Planning and Analysis. Please go ahead.

Thank you and good afternoon. With me on today's call are Mike Massaro, Chief Executive Officer, Rob Orgel, President and Chief Operating Officer, and Mike Ellis, Chief Financial Officer. Our third quarter 2021 earnings press release, supplemental presentation, and associated form 8K can be found at ir.flywire.com. During the call, we will be discussing certain forward-looking information. Actual results could differ materially from those contemplated by these forward-looking statements. We also will be discussing certain non-GAAP financial measures. Please refer to our press release and SEC filings for more information on the risks regarding these forward-looking statements, risk factors associated with our business, and required disclosures related to non-GAAP financial measures. This call is being webcast live and will be available for replay on our website. I would now like to turn the call over to Mike Massaro.

Thank you, Akhil, and thank you to everyone that is joining us today on our Q3 2021 earnings call, our second as a publicly traded company. We truly appreciate all the interest so many of you have shown in Flywire in getting to know our business as a recently listed public company. The third quarter was another strong quarter for Flywire. Rob Orgel and Mike Ellis will go into great detail later on. But first, let me start with some financial highlights. Revenue-less ancillary services year-over-year growth was 67%, with total payment volume increasing 76% compared to Q3 2020. This growth was driven by our successful land and expand strategy in the UK, a strong US education growth in the quarter, and the easing of travel restrictions around the world, allowing more travelers to begin to take those long-awaited leisure trips. Adjusted EBITDA for the quarter was 17.6 million, which is an increase of 7.4 million, or 73% from last year's third quarter, another great result that truly shows the strength of our unit economics. These great results this quarter have been driven by the continued execution of our multiple growth strategies across industries, and geographies. Our performance this quarter is also due to the commitment of over 600 flymates around the world who work each and every day to deliver value for our clients. We are so fortunate to have these amazing flymates who continue to stay focused and execute exceptionally well in this complex world. Our Q3 results further validate what we've discussed along our journey to become a public company nearly six months ago. First, there is a strong need for Flywire's powerful combination of software and payment capabilities, especially for high-stakes, high-value payments. Second, the core markets in which Flywire operates provide a massive opportunity for long-term growth. Industries like education, healthcare, travel, and business payments are massive parts of the global economy, representing nearly $12 trillion of addressable market. These sectors are complex and have been poorly served by incumbent payment solutions. providing Flywire a great opportunity to modernize the payment flows within these sectors over the next decade. At Flywire, our mission is simple. We help our clients get paid and their customers pay with ease from anywhere in the world. This combination of software, technology platform, and payment network, our Flywire Advantage, is truly a differentiated offering that uniquely positions Flywire for success in these massive addressable markets. With Flywire, our clients do more than just track money and collect payments. They integrate our software into their existing back office systems and processes, display Flywire functionality to their customers via their websites and mobile applications, and deliver great payment experiences with value-added services like modern invoice presentment, flexible payment plans, seamless local and global payment methods, and much, much more. So while clients benefit from operational efficiencies, They also are able to delight their customers with a digital engagement platform throughout the entire payment experience. We've been at this for more than 10 years. And in that time, we've achieved significant scale and reach. As of quarter end, we accept and settle payments in over 240 countries and territories and in over 140 currencies. Today, we deliver some of the most important and complex payments for more than 2,450 customers around the world. And as many of you have noted, our business has numerous defensible modes, such as our deeply embedded industry-specific software, our proprietary global payment network that enables Flywire to mitigate the complexities around the movement of money for our clients, and our unique go-to-market approach, ensuring that we have a great team of experts from the industries that we serve engaging with our clients and our prospects. We believe the next decade will bring a wave of digitization across the industries we serve, and that Flywire is uniquely positioned to lead this trend with our powerful combination of software, payments, and our people. Not only do we believe that Flywire is uniquely positioned in the market, but we continue to see positive trends in the industries where we operate. In education where we serve private and public universities, colleges, boarding schools, language and vocational programs all around the world, we see strong demand for our solutions. providing flexibility to students, families to pay their tuition and fees over time and with a preferred payment method is truly top of mind for institutions. In Q3, our education clients saw a continued return to normalcy as vaccination rates increased in students' return to campus. This applied to international students as well. This summer, even with the uncertainty around the Delta variant, American consulates issued almost as many visas for international students as during the same period in 2019. In this positive macro environment for education domestically and internationally, our software continued to drive value consistent with our company's thesis and focus. In a recent survey of finance professionals at U.S. education institutions conducted by Payments.com, more than 80% of bursars at four-year universities said flexible payment plans tailored to individual students can be attractive alternatives to traditional paper-based payments. Our strength in our domestic solutions and the global nature of our education business positions us well for the future. In healthcare, providing more consumer-friendly and digital-first payment options continues to be a priority for hospitals and health systems. We recently commissioned a survey of more than 2,000 consumer patients in the United States. Our data found that 65% of Americans who paid their medical bills online for the first time during the pandemic plan to continue to make payments online going forward. In addition to the great benefits for consumers, a streamlined payment experience can have a dramatic impact on the financial health, the hospital, or health system. We recently completed a total economic impact report with Forrester Research to measure the return on investment of deploying Flywire. Their research found that Flywire can help our clients achieve 318% ROI over three years and see a payback period in less than six months. Our travel clients continue to see growth as borders open back up and restrictions ease. The United States announced it is reopening to fully vaccinated air travelers from around the world starting in early November, ending a ban that's been in place for 18 months. In addition, the United States also said it will lift restrictions for travelers in from Canada and Mexico, allowing fully vaccinated foreign nationals to travel, ending the ban on non-essential travelers that was in place since March 2020. As we approach the holidays, our recent research suggests that travelers plan to spend more money and stay longer. In our recent survey of more than 800 frequent travelers, 65% said they would expect to take a longer vacation than usual post-pandemic. And 75% said they will seek a remote destination where they would not be around large groups of people. And in our B2B business, where we support technology companies as a key target subsegment, we are seeing demand for our solutions as more businesses realize that digital payments are an integral part of the customer experience. At our recent Flywire Forward event, 42% of business respondents cited improving the customer experience as the top payment strategy priority for them. followed by automation, security, and international expansion. Speaking of the Flywire Forward event, we were so glad to see so many of you at our inaugural event, where we brought together business professionals from a wide variety of industries, as well as leaders in fintech and banking, to discuss the future, from payments to crypto and much, much more. It was clear from the event that digitized payments are becoming table stakes across every industry. no longer just in retail and e-commerce. The feedback from the event was very positive, and our team is well underway in planning similar events in the future. I would now like to turn the call over to Rob Orgel, our president and COO, to review some operational highlights from the quarter in the context of our growth strategy. Rob?