Opto Sessions – Invest in the Next Big Idea

Sezzle’s $808M Quarter: Why Buy Now, Pay Later Is Just the Beginning

• Haydn Brain & Ed Gotham

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Charlie Youakim, CEO and Co-Founder of Sezzle, joins OPTO Sessions to discuss company’s journey from startup to a leading public company in the fintech space, the evolution of Buy Now, Pay Later (BNPL) model and record growth in the past 12 months.

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Hello, and welcome to another episode of Opto Sessions. Today, I'm delighted to be joined by Charlie Youakim Executive Chairman and Co-Founder of Sezzle, the purpose-driven digital payments platform that pioneered interest-free buy now, later in North America. Since launching in Minneapolis in 2016, Charlie has guided Sezzle from startup to public company status, processing more than $808 million in Q1 of 2025 alone and lifting revenue by 123 % year on year. Today, we'll explore responsible credit, the path to profitability in FinTech, and why Charlie believes the next evolution of Buy Now, Pay Later is a full service financial hub that helps consumers graduate from installments to prime credit. How's it going today, Charlie? It's going fantastic. Thanks for having me. I appreciate it. Yeah, no worries. Where are you calling from today, the way? wow. hit for our company, everyone just started going everywhere. And I let you know, I was a Minnesota native, but I never liked winters. So I was like, okay, if everyone's really letting everyone move everywhere, maybe I should take part in this too. So I moved out of Puerto Rico. Yeah. team on there with you, they're spread out as well, remote. Yeah, we're basically a remote first culture. know, it's, we, we still have a headquarters or an office, should say in Minnesota. but we scaled it down. We increased the quality, scaled it down. Um, but we really don't push. I leave it to management, like different managers across the team to decide what they want to do with their teams in terms of in office or not. And most have decided to keep it remote and it's gone really, really well for us. Yeah. You hear various or mixed responses on it, but a lot of it, suppose, depends on who, who, who's in your team and the team culture. And it obviously does work because a lot of, a lot of companies exist today that operate underneath the same sort of remote culture. I, we, we love it. We love it. And I think, I think when teams have problems or companies have problems, my personal opinion, I think it's because they just use it as an excuse about on poor performance management. You know, honestly. not everyone is right from remote culture, but finding the people that are. And that is interesting. And so how big is the team now? We've got a little over 400 in the team. Yeah. It is wild. that expanded a lot recently or? Well, we've had, um, comings and goings with the team size. I'm, you know, I'm a startup guy by heart, you know, like I've, I've founded two companies and I'm, so I, I honestly, I love team sizes, like that are sub 10. It's just fun. You know, yours is like a tight group of people, but I also liked the challenge of adapting as the company's grown. Um, so, you know, I think. For me, it's been kind of fun, all elements of the growth. we've had, so we grew up to about 580 employees at one point in 2021. We were expanding to India, into Brazil, into Europe. And then I call it tech-pocalypse when everything kind of crashed. We missed a fundraising window. We had to make really hard calls. And those three expansionary regions were not, even on a unit economic basis, they were not profitable. So we had to pull back. Yeah, okay. went all the way down to 240 employees on that pullback from 580 and then now back to 400. That's the only time I've ever had that happen in my career in starting companies and I never want it to happen again. that was a hard time for a lot of lot of company private companies raising fund rounds and then having to, you know, scale it back once this the market got hit. But it's it's it's you've come through that the best survived. It's true. true. It is those pullbacks do pull back and you can find out who has the wherewithal to get through it. Yeah, yeah. So I thought we could start just for people who don't know Sezzle if you could just give a one minute origin story. What is Sezzle? How is it reshaping Checkout? Sure. So, Now Pay Later, the product we have is Buy Now Pay Later. It's four interest-free payments of 25%. So basically, you find us on merchant websites, that's where we started at least. On merchant websites, you might find a sweater like this for $100 and we would work with the merchant and get a little advertisement widget on their product page saying, or four interest-free payments of $25 with Sezzle. And that would change buying behavior on those merchants' websites because the customer would be like, well, I'll just budget for this and come back later. Typically a debit card user is our user. So they'd be like, ah, I don't have the money in my bank account or I don't feel comfortable going to that low of a level in my bank account. So I'll wait until I get my future paychecks. The customer would see our product on the website and say, ah, Sezzle's going to help me budget for that. I'm going to buy it. And then they'd search us out in the checkout and then make the purchase. we made this great, we still do have an incredible symbiotic relationship with merchants. where we help them make the sale and then they help us create consumers. But what's happened to Sezzle is we've adapted the model a bit and have gone more to direct to consumer because the consumer loves paying for so much. They were begging and screaming for us to add it to more sites. And so we did it through additional products and services, through subscription products and pay as you go products that allowed the consumer to basically subscribe to Sezzle or be a part of Sezzle now and use us everywhere. Yeah, that's pretty cool. saw that. Were you one of the first in Buy Now, Pay Later? Or did you come after a few of the others? You know, it's what's interesting. We weren't at the first, we were first in the United States. So the first, the uh innovator or the originator was after pay in Australia. So we noticed their model. I had been to Australia before I kind of call it like the USA South because the cultures are so similar, you know, the accents aren't for the cultures are. And so I was like, if it's working in Australia, there's a good chance it's a work in the United States. So we brought the model of the U S were the first to launch with it. But then at everyone came, I mean, it was like, After pay saw our launch within a week. swear within a week and they were already over here. They knew how important it was to get over here. So they came over here. We were probably like a $25 million market cap startup and they were a $2 billion company and they came over right away. Then Klarna came then quad pay launch, which is now zip. This is all within a matter of like probably eight months. All these companies came. So we were the first in the U S but we're not the largest. And I'd say mainly not the largest because these bigger players came in so fast. And really, they did a good job. A lot of our competitors did a great job. But as far as the many offer this sort of like, so you basically subscribe to says when you can do buy now pay later on any site now. Is that common or I think we're the leaders in that space. So we're not the leaders and maybe in the merchant partnership model at this point because of what I mentioned, these bigger players coming in and getting some big sites early on especially. But we adapted and we realized we have to adapt and we listened to the customer. They want to use it in more places. We launched our subscription products. We launched the on-demand product, which is Pay As You Go. And others are doing some of these things in certain flavors and to some extent. But I would say definitely Sezzle is the most fully featured on the direct consumer side. And that's where I think we're winning is on that side. So yeah, if we were going to say, where does Sezzle stand out? The people that use it was the one thing that they would sort of refer to is this. I think so. And then we also have another feature called Sezzle Up, where we're the only buy now pay later that allows a customer to basically opt in to credit reporting through Sezzle Up. It's free, it's opt in, and then we can help these customers build their credit score. Because typically a buy now pay later loan, which essentially is a loan, does not get reported to the bureaus, so the customers are not getting credit for this on their credit profiles. Which, and a lot of our customers are young customers, new to credit. They need this reporting, in our view. So we offered Sezzle Up and added that in. So I'd say between the direct to consumer products and Sezzle Up, those are probably our biggest differentiations to the consumer. Yeah. Okay. That's really interesting. And yeah, so going back to sort of more of where it began, because you've founded other startups before. initially, I think I'm right, I'm saying you're solving parking headaches at Passport. Is that right? And then you moved on to Sezzle. What did you learn from your experience there that has helped you on your journey to sort of inter-payments? I will tell you, I think if I didn't have Passport before Sezzle as in my background, I think we wouldn't have made it at Sezzle because there was almost like a minor leagues to the, the payment space and the retail payments is the major leagues. We're competing against PayPal, Klarna, Affirm, Afterpay. Zip like it's the major leagues the you know, no disparagement to the parking space, but it's not at the same level of competition. But for me, I think in that time period, it was a great learning about how to scale up a business. ah You know, about a do do the correct hiring, how to go out for the right strategies and how those winning strategies can help you win the space and You know, learned through a lot of bumps, you know, like the first time you ride a bike, you're to take a couple of falls. And so at Passport, we took a couple of falls, took a couple, I took a couple of lumps. And then I basically learned like, okay, here's the corners you can cut when you're building the next company. And you just know, we don't need to bother doing that. We don't need to bother doing that. We'll go straight down this path. And that I think helped me more than anything. The fact that I basically ridden the bike once before. And I just think, you know, payments also, I learned a lot about payments. Payments is a very interesting space. um So I think I wanted to stay in the payment space, but just go after something bigger. Yeah, that makes sense. And was that your first startup or you have others before then? Okay. And how big did that one get to before you? Really? Oh, wow. there were two big companies in the space and people thought we were crazy. was a mobile mobile payments for parking was our focus and it pay by phone and park mobile were the leaders. were like the Uber in the lift at that time. And people were like, you don't understand a chance launching against these guys. And, you know, I was a younger guy. Our, teammates were younger, we're a younger group of people and we're like, we just did it anyway. And what I basically learned was if you pick the right strategies and right approaches and find the right niches and listen to your customers, you can win. You can win. And we did. the same again at Sezzle? So if you're going to play away one thing that allows you to compete against the Goliaths in the industry, what is it? Is it listen to your customers? Yeah. it all starts with excellent, really high standards, really high standards on hiring, and then really working hard to keep a great team together. Because once you have an incredibly smart team and you have them focus on the right strategies, you can slice through the competition. You really can, it's amazing. mean... I looked up to a lot of founders that have done much more than I've done. Elon Musk at X, great example, came into Twitter, cut the staff back, but then focused, think really probably focused on quality and focus with the really tight team. And look what X.com has done in a short period of time. They've made a great platform with the Twitter like platform, but they've also launched Grok. Pretty amazing. And from a scale back team, like 80 % scale back. So I think for me, it's always been about the team. And then once you've got the team, you create the right strategies to find your niche in the space and then execute on that. And you can really just slice through butter just with that kind of a concept, even against some of the most incredible competition. Their size holds them back, em How do you find the right team? Follow-up question to that. How do you find these A-star players? Well, business is, you know, a little bit of art, a little bit of science. You know, I think early on, a lot of good gut instinct on who the right people were. Uh, but we also use a lot of data and have very high standards on data. Cause you know, my, my view with hiring is the interviews are almost a crap shoot. You know, someone who's a good, it's like a two by two. always think of the two, this two by two, good talker, good doer. You know, if you had a good two by two. And the worst hire is the good talker, bad doer. And if you just focus on interviews, there's a good chance you're to get a lot of good talkers and bad doers, you know, which is the worst quarter. So what we try to do is we try to use data just like you would for credit scoring. And so I know not everyone loves this type of approach, but we, what we do is we look back at transcripts from school and we want to see that you were a performer in school, 3.8 GPA plus kind of stuff. Yeah. and then we also do IQ tests as people come in and we want to see like top 10 % IQs. And I know people are excellent below those levels, just like you can have a six 50 credit score and be an awesome repair. But the data, at least my data in my head shows from my experiences that your hit rates are way higher if you use those two. And the reason I think those two are important to me. And it depends on the role, by the way, it depends on roles, but for a lot of like, um, you know, the creative class roles, these are important metrics. Because if you have a high IQ, that's like your horsepower, right? Ability. And then your GPA is like the GSD. You get shit done. You know, that you know how to get things done. And by the way, not just get things done or get things done that you like. Cause in school, you probably had a lot of classes that you didn't even care about, but you're like, I still got to get it done. And I think that happens a lot in work. You'll get projects that you don't necessarily care about, but you still. Yeah, you still want to get the A. So I think between those two metrics, we've had really good success in building up a really like almost like an Ivy league of a team level. And so that's been a really good one for us for hiring practices. And then we just have, would say also really strong performance management along the way. We make sure we hold people accountable. My view is always the best people want to work with the best people and the best people hate dragging anchors and It's kind of our job as the senior management to make some of the tough calls sometimes to make the high performers feel like we're protecting them for their, for their really high work and then reward reward people and make sure that they become big winners at the out, you know, at the out, good outcomes at the end too. All that plays into a really good team building. And what about the cultural side? How do you take into account sort of how they interact with others? Is that important? too. Yeah. You know, there's, there's IQ and there's EQ. I think EQ is really important too, but EQ is very difficult to measure at the start. know, you have the interview, but it really comes down to when people are in the company and working with people. And we do say like we have our core values. So our core values are, hopefully I remember every one of them because I don't talk about it all the time, but character and integrity. Number one, face the pyramid. Then we have be a great communicator. Listen. that means listening is listening is half of communication listening as well. Um, be driven to succeed. want people to like to, I kind of give the analogy of sports to business. Like imagine you're playing tennis. Yeah. You want to win, right? That's where you're on the court. It's fun to win, but we're also not going to go and do a Tanya Harding and try to knock the person's knee out and hurt them. We just want to beat them. We want to out train them up and beat them. we have act like an owner as another core value. You don't really care about the company like an owner would, and then, um, be fun to work with. And when I say about fun to work with, it's not like happy hours. And I would say like, love happy hours, but that's not what we're talking about here. We're talking about like when you're in meetings with people, you love, you got a smile on your face. Cause it's just fun to work with the other people on the team, you know, no a whole environment, people that yell you're out. We've done that. You're not going to make it. And I think by doing all these kinds of things, like having good performance management, having good core values that we stick to, it's really led to a good remote first culture too, which is kind of, you know, People think you can have that kind of environment in a remote first culture, but I think we do. Yeah, that's awesome. Thanks for that. That's a good insight into that. it's, I know, well, a lot of people are gonna find that very interesting. Touching on a lot of things that, you know, a lot of people sort of know when they talk about companies, but doing it is hard, right? Like, um doing it to the level you're talking about. And then that's where you get the actual gains from it. Just rolling into back into the product again, you've rolled out Pay in Five, auto coupons, price checks, money IQ tips, which feature surprised you the most in the way shoppers actually use it. You know, it's funny, it's pan five, um which seems so silly, but you know, the core, the original buying up, other product was paying for see 25 % down in time of purchase, then budgeting two weeks, four weeks or sorry, two weeks, four or six weeks. And someone in our team, I can't remember where I had the idea of maybe we should test pan five or look into it. And so we did a survey. The survey results were like jaw dropping. Customers really loved the idea of it. And we're like, okay, well, they're so strong. got it. We have to test this and we tested it and consumers loved it. And I think it's just so silly, right? Well, more payment, but you know, consumer behavior, you just never know. And someone's just got to put it out there. And so we, did launch like a beta test of it where we pulled it back now. Cause we're just beta testing it. So plans are to probably put it back in the product here. We're just trying to figure out how to weave it back into the product right now. But that was, I'd say a big win in terms of like a product adaptation that that was really interesting and, and, and surprised me. Yeah. Do you have times when you ask your customers something, they strongly agree X, and then you release something and they sort of don't do what they said they might strongly agree to, if you see what I mean. Do you find that or do you generally find that, you know, whenever you get that sort of really strong response, there is a product feature that is a product feature that they will want. Yeah, I think we had some of this stuff. were, we've had plenty of tests and partnerships that have not worked out. Um, you know, I think when I think back to that, like one of them was like credit reporting, credit building type stuff with, with a partner. And when we survey the customers, you know, they call it, think they call it preference falsification by customers. They say they think, yeah, I would do that. I would totally do that. So we're like, that's going to work. And then we launched the product and then no one basically took it up. At least through the partnership model. And so we had to pull it back because it's like, okay, no one's even doing this. So we've, we've definitely had that no doubt about it. So we'd take the surveys. We do like to do surveys. We do like to do AB testing, but we definitely do take the surveys with a little bit of a grain of salt because not every time they, customer tells you that they want something. Do they actually really want it or are willing to do the work to do it. that is interesting. Moving on to the server, you have so many things that you released recently. Sezzle balance, express checkout, new browser extension all launched. think while the consumer conference was a bit wobbly. Which of those are you most excited about today? browser extension far and away. And the reason being is because this came from our head of product Sarah Hill in terms of her discussions. She had this comment like, need to meet customers where they are, not try to force them into our app. And so I think this browser extension does a great example of that. Soon we have some tests going on right there small beta groups that have this already in our systems where you can get our Sezzle browser extension But I'd say soon to come when you download the Sezzle app There's gonna be an option to install our browser extension and the point of installing the browser extension on your mobile phone Is that will help you find discounts and deals auto apply coupons get cash back? All through this browser extension and the idea being like, you know normal workflow of our lives I'd send you something like hey Ed check out this tent, know, you like to camp trick of this tent, you might want to buy it. It was awesome. You get on messages or WhatsApp and then you click the link and then it goes into your browser on your mobile phone. You're not going right to Sezzle. Your normal work floors are going to your app. You you click the link, it goes into Safari or Chrome. And then in that experience, Sezzle will say, Ed, you can find this tent $10 cheaper over at so and so sporting goods. And then you're like, wow, so it'll just save me a bunch of money. That's awesome. And so you're reminded of Sezzle that we helped and we helped in that situation. And then you are maybe more likely to come back into our ecosystem because you remembered us. But that's the one I think that has the most power for helping the customer because it's in their daily lives. And I think symbiotically helping us because it reminds the customer that says it was helpful. then they think, should, know, cause a lot of people forget about apps. I know they do. I do the same thing. You forget about apps. And so by interjecting ourselves into their daily lives, we think we can create a reminder, but also help them. Yeah, it's that when the habit or the use case, the frequency becomes uh stretched out, you're less likely to remember. So it's hard to it on it, it? So unless someone's buying something every day, but you know, there's a chance they forget about it, sounds like a great idea. Do need extensions? Do they work on mobile or are they mainly desktop? mobile, you know, this is the, this is the new idea. So what we call it internally is like a honey for mobile. Because I don't know if you know about the honey browser extension, PayPal bought them. I used to use it, but I think most people now have migrated from shopping on desktops and laptops to shopping on their mobile phones and browser extensions do exist on mobile phones. Not a lot of people realize it. You can install browser extensions on your mobile phone. It's I think maybe a more nascent technology. And so I think that's why people don't realize it. And so we're trying to kind of do this like quote unquote honey for mobile type feature set and bring that type of thing to our mobile phones now instead of the desktop. That's a idea. I'll have to try that out because I've used Honey on desktop and it was really good. Exactly. a lot of people shop. I mean, I used to think I'm never going to shop on my mobile phone. I definitely do it. I definitely do it. So you've also predicted that by now pay later, the share of US payments could jump from six to 20%, which is a huge, huge growth. What do you think behind that? that is it actually how lot of consumers want to purchase? Or is there another reason why it's growing so quickly? Well, I think both. So there's the, see what's already happening and we hear the feedback from consumers. You know, in a way, buying out pay later, you know, the payments pie used to be this like debit and credit pie. And it was almost like a 50 50. And the way I view buying out pay later, it's a budgeting tool, but it's also a hybrid between the two. So the reason I say it's a hybrid is because one of the benefits that people like about debit cards is the certainty that it's off my books. I don't think about it. And there's credit card users that like it to be on their books and they like the time value of money. Like that's me. I like time value money. I'll use credit cards. But there are some customers that like they want the purchasing power that they're missing from debit. but they still like the certainty of payment. And so that's where I think buying out pay that are really is the hybrid between the two. And we've been seeing the pie grow. And then so I, we know that customers love it. And then the reason we think this kind of 20 % number, first of all, it's like a public number. It's not, it's been brought up by another group. forgot the name of the group that uh directed towards it, but I think they got to it from looking at other countries. So in Australia, BNPL is around that 20 % mark. Yeah, and if you were where it originated. Yes, like around 20%. Yeah. Yeah. I think there was a stat that during Amazon's Prime Day, it was like upper single digits of transactions were BNPL. So above the 6 % number already. And then in Europe, there's a you know, it's near that 20 % number too. So we kind of have the triangulation across other countries or regions that it's already happened. That's huge portion of online transactions because that's a lot of money going through. it was like an 8 % share at Walmart for Prime Day. For Prime Days. And you've obviously had a really good start to the year, revenues up a lot, profits quadrupled as well. What's behind this? it just you getting network effects starting to work? Is it word of mouth or why have you suddenly seen this growth recently? I think we really nailed a few products in a row is probably the answer. You know, we had three years ago, we launched premium our first subscription, which was like a limited set of top merchants that you could shop at in our app. We heard customers saying we want more. We launched anywhere. So we issued customers a virtual card on their mobile phones. They could tap anywhere. And if they had availability, we could split it in four. Customers loved it. And then this year, or just like nine months ago, we launched uh on demand. It's not named to the customer because it's not a product, a subscription product. It's just the ability to pay as you go. Like if you want to shop at Amazon, $3.50, we'll charge you that basically a finance charge and you can split your payments at Amazon. And so those have all been winners. So I think there's like a compound effect of just keep on launching winners in the product suite and they just kind of all carry it forward. So I think there's a bit of that. And we're also riding the wave of BMPL itself growing. And then what we... What we really try to do, I mean, I love business. think it's fun. And so I think we're also basically trying to show the scaling ability of Sezzle that we don't really have to add to the team at nearly the same rate that we can grow revenue and gross margin. And, you know, kind of show and offer, you know, to the public that as we grow the gross margins, we don't have to grow our OPEX, which increases net income. So that's been a little bit of our story. Would you contribute that down to advances in AI recently, or is it just having a really effective team? I think, I think a really effective team at this point. We do always believe in automation. Even before AI, we used to joke around like the, Simpsons chat or chant for monorail. I don't know you ever watched Simpsons, but monorail, monorail, monorail. We used to joke around that we had automate, automate, automate. We used to automate everything we could at Sezzle, um, to try to keep our team tight. Um, I wouldn't say we're there yet with AI. I say that's another advancement that's going to keep on helping us. We're starting. We have an AI team within Sezzle now. but it's new, it's like six months old. And so we're trying to inject AI into the company, just like we were injecting the automation with technology before. So I think more to come. And I think the goal is to keep on showing that you can do less with more. know, people have said you can launch billion dollar companies with a team of three or four with AI. I agree. think that may, I don't know if we're gonna be the ones to launch the side project with three or four people on AI, but. I think it definitely can multiply your efficiency, no doubt about it. And when you started, I just remembered a question I wanted to ask you earlier. How did you market the product? Like how did you, how did you one introduce this to people? This new concept, obviously, because it's relatively new at that point. Do people just immediately understand it? I mean, it's not, I suppose it's not that difficult to get understand, but it's a new thing for them. And also how did you get it in front of people? Was it just getting the right, a few of the right merchants on board and then it starts to go? How did you start that? Yeah, at the outset, it was through merchant partnerships. So getting merchants to advertise this on their site to change the buying behavior. Home run. mean, Ed, like these were smaller merchants. We started with SMB merchants, really small merchants, and they don't have the ability to do AB testing. You know, they're too small. They didn't need to AB test. The moment they put Sezzle on their websites, they're like, Wow, okay, this is working. They would go tell their friends and their friends would reach out to us. Their competitors would see it. They'd reach out to us. So it grew really rapidly distribution wise that way because the customers saw it and picked it up and it grew that way. Now because of our direct to consumer products, we're also doing direct to consumer advertising. in some channels. So and that's also working. So we've had we've adapted over time, which I think companies always need to do. And now we basically have both models with the merchant partnership model in play, still working. And now we have the direct consumer models, have two funnels of customers into the systems. And in terms of the merchants, how big of an impact are we talking? like, because obviously, that's a huge benefit for them to just introduce a feature like this, and it increases sales at a certain percentage, but is it are we talking sort of 10% more? Wow. I mean, there were some merchants that we were doing like 40 % of their sales. Yeah. Early, early on, like it depends on the merchant category, merchant type. I'm making range from anywhere from like 2.5 % of sales to like, like I said, the 40, but I'd say that most of time it's probably around this 10 % to 15%. It's kind like the sweet spot where it's, tend to find BMPL is like kind of that range of share of checkout. And they pay a flat fee on, or is it a percentage? Yeah. what's both? So the pitch to the merchants at the outset was you're already paying your payment processor 3 % plus 30 cents. Sezzle will charge you 6 % plus 30 cents. And so the dealt with it's inclusive of processing. So the Delta is 3%. And so the idea would be like, we're going to increase your sales. So if your margins are bigger than 6%, or five greater than 10%, you don't want to be too close, right? If you've got good margins, you want to add us because we're going to drop more. gross margin to your bottom line if you add us. And that was basically how we came out there and pitched it. And you know what? The blended average, like probably about last quarter results or maybe a couple away, was like a blended average of like a 5 % merchant fee rate. So it varies. Like it can go really low for big enterprise merchants, but the standard rack rate in our industry is around 6 % plus 30 cents to smaller merchants. And how, just digging into the financial side of it, how are you able to offer all this cash as a loan? Do you have a relationship with a bank that sort of supports it? Exactly. Yeah, we work with a hedge fund. Over our history, it's been hedge funds and banks. You work with basically both to kind of supply the funding into the business. And so our current rate is SOFR plus six and three quarters right now, but we can refinance it in October. But it works because basically we have this supply, it's only like engine oil. So we basically have this engine oil comes in and we can lend that out to the customers. And because of the dynamics of the product, the pricing works out. It's because we turn over quite a bit. Yeah, I can imagine. Something that people will be talking about is potential about fraudsters, which is always a problem with it with online sales or any sales. How does Sezzle approach that? How do you mitigate it? Yeah, that's a great question. Honestly, I think it's one of the biggest problems in all of payments is fraud. And I wish the government actually helped create consortiums to help more honestly, because I think it's these fraudsters hit tons of companies at the same time. They try to at least. basically, we do a couple of things. So the first thing is we pull in data sources, like a lot of different data sources. But we really focus on the third party fraud, making sure that you can't create synthetic identities in our system. And so the viewpoint is if you stop the synthetic identities, these automated tools that try to create fake accounts and try to wipe you clean, that's 99 % of the problem. The last 1 % is the first party fraud, which you can still get with some of the kind of credit checks or data checks on consumers to see if they've done this elsewhere. But it's almost impossible to totally stop that. And that's the customer that's like, Oh, I heard I can get $300 or $400 availability from Sezzle. can sign up and then just go buy a PlayStation and never pay them back. So that's why I hire their higher loss rates for newer customer groups. There always are and probably always will be because of that kind of dynamic. That's the one that I think will always exist. The first party fraud, but it's not massive. It's honestly like one of the most refreshing things about running a company like this, a lending company is you find that most, almost all customers want to pay back. It's just the ability. And in most cases you have these, like, you know, the thieves over there that kind of ruined it for everyone else a bit, but most people want to pay you back. And then you have these rings that try to do things and they try to do a lot of different things, but we've never really had a big incident at the company. You know, of course knock on wood, but I think it's because we have these really strong know your customer type systems and identity methods that really make sure there's a person on the other side. Yeah, I always I find it because you get a lot of this in the crypto world as well. The level that some of these like criminals will go to to set up all this these like systems and strategies for fraud is just crazy. I'm just like, where where have they been doing this stuff and sitting down and making these plans? It's just find it crazy. can't, I can't say it really upsets me honestly. And that's why I say there, it'd be nice if the government kind of tried to help because someone that tries to get Sezzle is going to try to get the other five players and buy and I'll pay later. They're going to try to get a bunch of other financial services and banks. It's like, like it's the same people. It's the same people. awful nowadays with AI and they can get scared a lot quicker, trick people a lot easier. It's crazy really. Yeah, they tend to, the third party groups also try to tend to trick people. They try to trick people into like, hey, give me your account and password. And I'm going to text you, gives me, I'm from Sezzle, give me the number. And it's just like, you can't believe people believe this stuff, but it works. It's just awful they do that thing. Yeah. Anyway, we'll move on to the best. Thanks for that. So, talking about the future in Sezzle. Where do you see Sezzle five, six years from now? What new features have we got? What is the Sezzle app? What's your... it's basically a daily life app for customers in financial services and shopping. Those are like our, we view those as our pillars. And basically I'd say in five to 10 years, you download this as a lamp, we'll be your hub for your finances. know, checking account, credit type account, maybe credit builder, credit cards, maybe an actual credit card at some point in the future. you know, earned wage access, cash advance, BNPL. We're going to try to figure out which ones are the right features to add in over time. But we're shooting for it is like, we're not going to be with Amex. That's not our target customer. Our target customer is probably more like a chime customer, probably, you know, if you had to think about it in terms of like, you know, a quick thought on it. More heart of America, honestly, most of America type of product. And then so that's like the financial services side. And on the shopping side, Couponing discounting price comparison the browser extension speedy checkouts basically making says a lot app where You want to use says well every day or you you bank with us or whatever it might be or you want to use it every day because you know if you go shopping or go looking for looking for something we're gonna save you money and So I think this heart of America customer. Yeah financial services products help them for sure no doubt about it, but saving the customer money on purchases that's right to the bottom line and We're almost thinking about these honey for mobile features as not really like a moneymaker for the company, more of just like a slamming tons of value into the app. So the customers want to be in the says a lot, you know, so that's like, that's a vision making like a daily use app in the next five years. That's really interesting. Well, thanks very much, Charlie, for your time today. It's been great to go through Sezzle. I was going to ask actually, in terms of regions, do you see any other expansions of regions? oh and we like us in Canada. And I think right now what we're trying to focus on more is horizontal product expansion in us in Canada than regional expansion at the moment. And so I think that's why we think more like this. hate the term by the way, I'm trying to like the super app approach of like making the app more and more and more powerful in terms of what it offers in the feature set and just focusing on this region. That makes a lot of sense. Yeah. Well, yeah, thanks again, Charlie. It was really, really nice to speak to you. Actually, I was going to just ask you before we wrap up. um Do you have a finance or personal finance book or something like this that you recommend to others? Or if it's not personal finance, maybe you will step back a bit further into something more general. Yeah. Poor Charlie's Almanac. I love Charlie Munger. Like I've always loved his like, he's his like dry humor and he was great. So poor Charlie, I probably read poor Charlie's Almanac like three times in the last three years, just cause he just kind of cracks me up. And you know, people that follow us in the investing world and like listen to our conference calls, I do a lot of, at the end of the calls, I do some quotes from him because I just love his attitude. Yeah. Cool. Thanks, Charlie. I really appreciate it. It's really wonderful to have a chance to speak to Paul like yourself. So thanks again. We appreciate it. And I'm sure everyone's going to love the show. Appreciate it, Ed. Thanks for having me. All right.