2023 Annual Meeting Addresses and Presentation

2023AnnualMeetingAddresses
LowerHutt,NewZealand-14September2023
Chair’sAddress
It’sbeenanothergreatyearatPaySauce.I’mdelightedwiththeprogresswe’vemade
towardsdeliveringourstrategicobjectives,particularlyasweprogresstowardsour
visiontoprovidepayrolltoonemillioncustomersglobally,withournextstepexpansion
intoAustralia.Aswecontinueourevolutionfromstart-uptoscale-up,itisessentialthat
wehavetherightteamprovidingdirectionandinsightsandensuringthebusiness
remainsforwardfocused.Tothatend,wewelcomedMarkSamlalasanadditional
Boardmember.Mark’sinternationalpayrollexpertisehasalreadyproveninvaluableto
thedirectors,andtoourCEOandco-founder,Asantha,aswebuildourbusinessand
ultimatelycreategreatershareholdervalue.
WealsohaveanotherimminentchangetoourBoard,withJacquelineCheyneelecting
toretireattheendofherterm.JackiewasappointedtotheBoardinJuly2020and
electedbyyou,theshareholders,inSeptember2020.Asmanyofyouwillknow,Jackie
isattheforefrontofclimate-changerelatedactivitiesandislookingtocreatecapacity
toaddevenmorevalueinthatspace.We’dliketotaketheopportunitytothankJackie
forhercontributionasanindependentdirectorofPaySauce.Asshareholders,youcan
restassuredthatthefinancialandriskreportingframeworksareinexcellentshapeasa
resultofhertermonourBoard.AsChairofPaySauce’sAuditandRiskCommittee,
Jackiehasperformedacriticalfunction,andtheBoardhashelddiscussionswith
potentialsuccessors.Wewillannounceanappointmentassoonastheadvancedstage
processtoreplacehasbeencompleted.
Whetheratagovernance,executiveoroperationallevel,peopleareacritical
componentofPaySauce’sevolution.PeopleareourmostvaluableassetandAwesome
Peopleisoneofourstrategicobjectives.IntheyeartoMarch2023,wehiredaChief
PeopleOfficertoensureweattractandgrowkeytalentatPaySauce.Asthebusiness
hascontinueditsjourneytoserve1millionbusinessesglobally,theadditional
investmentintopeoplehasbeenfocusedaroundstrengtheningtheSales,Marketing
andProduct/Tech.Increasingcapabilityinthesefunctionswillcontinuetoensurethat
wereinvestforlong-termgrowth.Thisisthebestvalue-creationopportunityforour
shareholders.
Wehavehomedinonourtargetmarketandstrengthenedindustryandchannel
partnershipstoreachandsupportthatmarketinawaythatworksforourcustomers.
ThatstrategyhasensuredagreatoutcomeforPaySauce,forourpartnersandmost
importantlyforourcustomers.Thosewin-win-winpartnershipsareformedbecause
weobsessovercustomers,toensuretheoutcomeisoptimisedforthem,byworking
withpeopletheyalreadytrust,suchastheirAccountantorindustrybody.
ThatmarketapproachhasserveduswellinNewZealand,andwe’llapplythelessonsinour
domesticmarketaswelaunchouroverseaspilotinAustralia.Ilookforwardtosupporting
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Asanthaandtheteamaswecontinuetonavigatethemultitudeofopportunitiestoexpand
PaySaucefurther.
Toourshareholders,onbehalfoftheentireboardofdirectorsIwouldliketothankyoufor
yourtrustduringtheyearandlookforwardtoyourcontinuedsupport.
CEO’sAddress
Cashremainskingintermsofhowwemanageourbusiness,andIamdelightedthat
PaySaucegeneratedpositiveoperatingcashflowsthisfinancialyear.Beingincontrolof
ourowndestinyisimportantandcarefulmanagementofcashenablesustomake
goodinvestmentchoices.Weappreciatethatthat’snotaprivilegeheldbymanyinthe
currenteconomicclimate.
Aswellasturninganetoperatingcashlosslastyearintopositiveterritorythisyear,
therewereseveralhighlightsinFY23.Weincreasedrecurringrevenueby68%yearon
yearto$5.7mintheyeartoMarch2023.Thattoplinegrowthhascomefrombothnew
andexistingcustomersthroughprocessingfeesandinterestearned.Therevenueuplift
andtheimprovedmarginthatresultedfromscalingwerethekeycontributorstothe
77%yearonyearincreaseinthetotalCustomerLifetimevalue.Wealsointroducedthe
Ruleof40thisyearasakeyinvestormeasuretobalanceprofitabilitywithgrowth.At67,
I’mverypleasedwiththeoutcome.
AsShelleyhassaid,we’vereinvestedforlong-termgrowth,andthatstartswithour
peopleintheProduct&Developmentteamwhereweincreasedtheheadcountby
67%.Byattractingandretainingkeyproductanddevelopmenttalent,we’llevolveour
producttoenableexpansiontoAustralia.
Thattalent,alongwithmanyotherkeyroleswereidentifiedandbroughtonbyJessica
McLean,ourfirstChiefPeopleOfficer.I’mdelightedJesshascreatedaPeople
Experiencefunction,buildingefficiencyintoourTalentAcquisitionandenabling
improvementincapabilityacrosstheorganisation.OvertheyeartoMarch2023,we
increasedtotalheadcountby31%,andretainedourfocusondiversityandvalues.
Ourvalues-drivenapproachalsohelpsusidentifywinningpartnerships.Bytruly
understandingourcustomers’needswepartnerwithpeoplethatourcustomers
alreadytrust.NewpartnershipsintheyeartoMarch2023includeMasterPlumbers,
MasterBuildersandHospitalityNZ.Byworkingcloselywithindustryexpertswecan
betterunderstandthespecificindustryproblemstobesolved.
Customeradvocacyiskeyforus,andthat’sreflectedinourNPSof48.One
industry-agnosticproblemtobesolvedrelatestoemployees.Bylisteningtoour
customers,weknowthatmanyoftheirstaffrequiresomesupportwithfinancial
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literacyandwellbeing.Thiscanmakethemvulnerabletoexploitativepracticesto
accessemergencyfunds.I’mproudthatweestimatethatPayNowhassaved
employeesover$4mininterestandfeesthattheywouldhaveincurredhadtheygone
toapaydaylender.
Financials
TheyearendingMarch2023wasanotherbreakthroughyearforPaySauce,withtopline
revenuegrowthbeingthekeydriveroftheimprovementaswescaleup.We
introducedtheruleof40asakeybenchmarkforPaySauce,beingameasurethat
recognisesthatbothprofitabilityandtoplinerevenuegrowtharekeyfactors
contributingtooverallshareholdervalueforSaaScompanies.We’veimprovedthat
measureandincreasedourruleof40scoreto67,upfrom36lastyear.The67scorethis
yearisderivedfrom68%recurringrevenuegrowth,lessa1%lossinEarningsBeforeTax
DepreciationandAmortisation.Theequivalentnumberslastyearwere62%andaloss
of26%(62minus26equalsascoreof36).
Totalrecurringrevenuegrew68%from$3.4mto$5.7mandthathelpeddriveupthe
grossmarginby4percentagepointsto73%asthecosttoservethosecustomerswas
restrainedduetotheeconomiesofscale.Thoseefficiencyimprovementsdirectly
impactedthenetcashgenerationandadded$930ktothenetcashfromoperating
activities,turningthe$666kcashutilisationinFY22into$264kofcashgenerationin
theyeartoMarch2023.Havingreachedthemilestoneofgeneratingpositive
cashflowsinthequartertoMarch2022,wesignalledtheintenttoreinvestthesurplus
cashbackintothebusiness.
Consequently,expenseshaveincreasedataratemoreinlinewithrevenuegrowth,
resultingintherevenueandexpenselinesconverginginthegraphinthesecondhalf
ofFY23.Thetrendremainsfavourableoveralltowardsvaluecreationforyou,our
shareholders,withtherateofexpendituregrowthbeinghalfoftherateofrevenue
growth.Thishasdelivereda$0.7mimprovementinthebottomlinetoalossof$0.56m.
The68%yearonyearincreaseinrecurringrevenuecamefrombothnewandexisting
customers.Wedrovethatadditionalrevenuebothdirectlyfromcustomersthrough
collectionofprocessingfeesandindirectlythroughearninginterestonthefundsheld
onbehalfofthosecustomers(thefloat).AsattheendofMarch2023,theAnnualised
RecurringRevenue(ARR)hasincreasedto$6.7m(up50%YoY).
RecurringrevenueisakeycomponentindrivingupourCustomerLifetimeValue
(CLTV),andintheyeartoMarch2023,theCLTVincreased77%yearonyeartoalmost
$54m.TheslideshowstheSaaSmetricsthatwecontinuallymonitortoensurewe’re
maximisingthecustomerlifetimevaluebymanagingeachstepoftheSaaScustomer
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journey.TheCustomerAcquisitionCost(CAC)was$500percustomerintheyearto
March2023.Onaverage,weearnedrevenueof$81permonthfromeachofthose
customers,anditcostusanaverageof$22permonthtoservethem.Whenwe
extrapolatetheaveragemonthlychurnofjust0.75%,itmeansonaverage,customers
staywithusfor11yearsandthereforeeachcustomerhasalifetimevalueof$7,817.
Whenmultipliedbyourcustomernumbers,thetotalcustomerlifetimevalueis$53.7m.
Intermsofexpenses,investmentwasmadepredominantlyintopeople,with10new
FullTimeEquivalentstaffaddedtothePayForceintheyeartoMarch2023.This
accountedforoverhalfoftheincreaseinexpenses.Theadditionalinvestmentinto
long-termgrowthwaschannelledintoinfrastructureandsecuritycostsandmarketing
costs.
Sincethefullyearresultswerepublished,we’vealsoreleasedthequarterlyupdateto
themarketforthequarterendedJune2023.TheJunequartercontinuedthegrowth
trendwithrecurringrevenueup48%yearonyear.Thehigherinterestrateenvironment
ishavingapositiveimpactontheinterestearnedonthecustomerfloat.
ENDS
ABOUTPAYSAUCE
PaySauceisaSaaSfintechplatformprovidingsolutionsforpeopleatworkin14
jurisdictionsacrosstheAsia-Pacificregion.Wegiveemployersthetechnologyto
digitallyonboard,payandmanageemployeesfromanydevice.Ourplatformincludes
rosters,mobiletimesheets,payrollcalculations,bankingintegration,automated
payments,PAYEfiling,labourcosting,automatedgeneralledgerentriesanddigital
employmentcontracts.
www.paysauce.com
CONTACT
Pleasedirectanyinvestmentqueriestoinvestor@paysauce.com.
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Annual Shareholder Meeting
14 SEPTEMBER 2023

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Disclaimer
●The information in this presentation is of a general nature and does not constitute financial product
advice, investment advice or any other recommendation. Nothing in this presentation constitutes legal,
financial, tax or other advice.
●This presentation should be read in conjunction with, and is subject to PaySauce’s Annual Report,
market releases and information published on PaySauce’s website - www.paysauce.com
●This presentation may contain forward looking statements about PaySauce and the environment in
which PaySauce operates, which are subject to uncertainties and elements outside of PaySauce’s
control - PaySauce’s actual results or performance may differ materially from these statements.
PaySauce gives no warranty or representation as to its future financial performance or any future
matter.
●This presentation may include statements relating to past performance, which should not be regarded
as a reliable indicator for future performance.
●This presentation may include information from third parties believed to be reliable; however, no
representations or warranties are made as to the accuracy or completeness of such information.
●While reasonable care has been taken in compiling this presentation, none of PaySauce nor its
subsidiaries, directors, employees, agents or advisors (to the maximum extent permitted by law) gives
any warranty or representation (express or implied) as to the accuracy, completeness or reliability of the
information contained in it, nor takes any responsibility for it. The information in this presentation has
not been and will not be independently verified or audited.
●No person is under any obligation to update this presentation at any time after its release to you or
provide you with further information about PaySauce.
Please refer to the Glossary for definitions of key metrics used in this presentation.
All currency amounts are in New Zealand Dollars unless stated otherwise.

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Shelley Ruha
Non-Executive Director
(Independent), Chair
Michael O’Donnell
Non-Executive Director
(Independent)
Board of Directors
Mark Samlal
Non-Executive Director
(Independent)
Gavin Thompson
Non-Executive Director
(Non-Independent)
Jacqueline Cheyne
Non-Executive Director
(Independent), ARC Chair
VOTE
VOTE
Asantha Wijeyeratne
CEO & Co-Founder, Director
(Non-Independent)
RETIRING

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Executive team
Jaime Monaghan
CFO
Asantha Wijeyeratne
CEO & Co-Founder
Jess McLean
CPO
Mat Stokes
COO
Troy Tarrant
CTO & Co-Founder

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Agenda
Chair’s Address
CEO’s Address
Financials
Resolutions
Other Business & Shareholder Questions

Shelley Ruha

Chair’s Address
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Awesome
People

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Reinvest For Long
Term Growth
Win-Win-Win
Partnerships
Obsess Over
Customers
Strategic Priorities

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Australia
●The next step in our growth journey to provide payroll to
1 million customers globally.
●Huge potential and a competitive space with real
opportunities for us.
●Ability to build and test our infrastructure outside New
Zealand.
●Replicating our playbook for success in the dairy sector
in Australia.

Asantha Wijeyeratne
CEO’s Address
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Self sufficient,
Surpassing
Rule of 40
Recurring
revenue grew
68% YoY
Improved
operational
cash by $930k
YoY
Total customer
LTV grew 77%
YoY
Sustainable
Growth
Revenue
Growth
Cash
Generation
Customer
Value Growth
Highlights
$53.7M$5.7M67
$264k

●Increased Product & Development Team headcount by 67%
●Mobile product prototype developed for Australian market
●Increased investment in R&D by 78% YoY, enhancing the security and scalability of the
architecture
We reinvested for long term growth...
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●Increased total headcount by 31%
●Established a People Experience function
●Providing employees with equity through a share scheme
●Focus on diversity, capability, connection and culture
We hired awesome people...
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●New relationship with CAANZ extends reach to Accounting partners in NZ and AU
●New relationships with Master Plumbers, Master Builders and Hospitality NZ
●Exposure across NZ through rugby sponsorships to raise brand awareness
We formed new win-win-win partnerships...
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●Net Promoter Score of 48
●Increased customer support capability
●PayNow saved customers an estimated $2.2m in interest and fees
We obsessed over our customers...
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Colleen Upton,
Hutt Gas & Plumbing
Hilary and Michael Gray,
Buzz Cafe
Sam Dews,
Sierra Delta Civil

Jaime Monaghan
Financials
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The rule of 40 provides a balanced measure
of two key metrics for SaaS businesses:
growth and profitability.

PaySauce uses the combination of
recurring revenue growth, and EBTDA* to
assess against this measure.

A score of 40 is widely seen as the
benchmark for SaaS companies. At 67 -
PaySauce has surpassed this benchmark
with annual recurring revenue growing
+68% and an improved EBTDA margin of
-1%.

Sustainable growth & the rule of 40
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*Earnings before Tax, Depreciation and Amortisation.

*excludes funds due to customers and the IRD, collected in performing our role as a PAYE intermediary

FY23 ($000s)FY22 ($000s)Change
Total recurring revenue5,7153,399 68%
Gross margin4,1462,34277%
Gross margin %73%69%4pp
Loss before tax, depr & amort(80)(880)(91%)
Net loss(558)(1,282)(57%)
Cash receipts from customers4,2903,06240%
Net operating cashflow*264(666)$930k
Rule of 40 score6736+31
FY23 results summary
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FY23 results summary cont...
Cashflows* increased by $0.5m year
on year for March 2023.
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*excluding loan drawdown and movement of funds held on behalf of customers
Closed the gap between revenue
and expenses to deliver a $0.7m
improvement in the bottom line to
a net loss of $0.6m for the year.

Revenue growth
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Recurring revenue grew 68% YoY to
$5.7m for the year ended 31 March 2023
as a result of:

●Increased customer numbers;
●Additional revenue from existing
customers; and
●Increased interest earned on funds
held on behalf of customers.

Annualised recurring revenue (ARR) grew
50% YoY to $6.7m as at 31 March 2023.
$5.7m
Up 68%

Customer value growth
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FY23 ($000s)FY22 ($000s)ChangeChange
Employee expenses3,7392,92881128% ￪
Infrastructure & Security429144285198%￪
Other expenses1,3901,19119917% ￪
Advertising, PR & Marketing273109164150%￪
Depreciation & Amortisation4984197919% ￪
Finance expenses622537148% ￪
Total expenses6,3914,8161,57533% ￪
FY23 expenses
2121

Recurring Revenue for June 2023
Recurring Revenue
22

Interest

Processing Fees
$1.73M ( 48% YoY)
for Q1 (June) FY 2024

Resolutions
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FOR
AGAINST
ABSTAIN
Resolution A
That Mark Samlal be elected as a
Director of PaySauce.

Mark Samlal
Non-Executive Director
(Independent)

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FOR
AGAINST
ABSTAIN
Resolution B
Having retired, that Michael be
re-elected as a Director of PaySauce.

Michael O’Donnell
Non-Executive Director
(Independent)

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Resolution C
That the Board is authorised to fix
the fees and expenses of Grant
Thornton as the auditor of
PaySauce.
FOR
AGAINST
ABSTAIN

Special
Resolutions
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FOR
AGAINST
ABSTAIN
Resolution D
Special Resolution
That PaySauce’s existing constitution
is revoked, and the new constitution
referred to in the Notice of Meeting
Explanatory Notes is adopted with
effect from the close of the meeting.

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General Business
The meeting is now open to
any general questions
?

Thank you!
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Recurring Revenue: Recurring revenue is revenue that is expected to repeat each period into the future. For PaySauce, this is directly linked to the number of customers, their size, and the
number of pays they run using the PaySauce payroll products. There are currently two sources of recurring revenue - processing fees and interest income.

ARR: The total recurring revenue for the last calendar month of the reporting period, multiplied by 12.

ARPU (monthly): Average revenue per user (monthly) is the total recurring revenue for the month, divided by the total customers processing payroll that month.

Gross margin: When discussed as a SaaS term, is the recurring revenue of the business, less the cost to serve customers. This is often then expressed as a percentage, where the gross margin
is divided by the recurring revenue.

Churn (monthly): Churn is expressed as a percentage calculated as the net reduction of customers in a calendar month divided by the total customers at the start of that month.

LTV: Lifetime value is the estimated value of a customer over its lifetime with PaySauce. This is calculated by taking the monthly ARPU multiplied by the gross margin percentage, then divided
by the monthly churn percentage.

Total Customer LTV: Total customer lifetime value is the lifetime value multiplied by the total customers.

LTV : CAC: This ratio reflects the return on investment for customer acquisition. It is calculated by dividing the lifetime value of a customer by the customer acquisition cost (per addition).

PayNow: A unique feature in the PaySauce mobile application, which lets employees access the money they’ve already earned - effectively letting them choose their own payday on demand.
Refer to paysauce.com/paynow for further details.

Rule of 40: The rule of 40 provides a balanced measure of two key metrics for SaaS businesses: growth and profitability. PaySauce uses the combination of recurring revenue growth, and
EBTDA to assess against this measure.

EBTDA: Earnings Before Tax, Depreciation and Amortisation is calculated by adding back depreciation, amortisation and income tax expense to the amounts reported in the NZ IFRS-based
financial statements. PaySauce believes that this measure provides useful insights to measure the performance of PaySauce as a SaaS business.

Note - the terms and metrics above are Non-Generally Accepted Accounting Principles (non-GAAP) measures and should not be viewed in isolation, not considered substitutes for measures
reported in accordance with New Zealand Equivalents to International Financial Reporting Standards (NZ IFRS). Refer to the PaySauce Annual Report for further information.

Glossary
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