i3 Verticals (IIIV) Baird Global Consumer, Technology & Services Conference 2025 summary

Strategic evolution and business focus

• Transitioned from a payments-centric model to a public sector software focus, divesting merchant services and healthcare RCM businesses to streamline operations and reduce leverage.

• Now operates with 26 software acquisitions, primarily serving the public sector, with payments fully integrated into software offerings.

• Recurring revenues account for 75% of total, growing at 9%, with high single-digit revenue growth targeted and annual margin improvement of 50-100 basis points.

• Maintains a debt-free balance sheet with $64 million in cash and an untapped $400 million credit facility, positioning for disciplined M&A.

• Focused on organic growth and selective acquisitions, especially founder-owned, smaller tuck-ins in fragmented public sector markets.

Market positioning and competitive landscape

• Public sector software market is highly fragmented, with Tyler Technologies as the largest competitor but holding only about 10% market share.

• Competes mainly against niche, founder-controlled or private equity-backed firms, with pricing power due to sticky, mission-critical solutions.

• Offers solutions across justice tech, transportation, utilities, ERP, and education, with each vertical contributing comparably to revenue.

• Emphasizes cloud-first architecture, with most new sales cloud-based and ongoing migration of legacy on-prem customers.

• Differentiates by not aggressively pushing price increases, contrasting with some private equity-backed competitors.

Product innovation and technology strategy

• Invests in building next-generation solutions, such as Justice Tech 3.0 and a new CIS for utilities, leveraging strong customer relationships.

• AI adoption is proactive but measured, focusing on customer service enhancements and developer productivity, with internal teams piloting select use cases.

• Modernizes legacy platforms with cloud-native, configurable, and low-code/no-code solutions, especially in ERP and licensing.

• Maintains a proprietary offshore development group to manage legacy maintenance and accelerate modernization.

• Sees AI as a long-term enabler for more intuitive, efficient software and faster product delivery.