Metropolis Technologies raises $1.6B to expand AI-powered frictionless payments beyond parking

stream. Um, give us the news. What's going on? [laughter] Busy day here in New York. We just raised $1. 6 billion. Whoa. [laughter] That is Congratulations on saying the biggest number. Said the biggest number. Congratulations. Not not easy. Uh not easy to do, but uh today you got it done. Okay.

But but it's 500 million series D equity, 1. 1 billion term loan. A lot of people are getting jitters. They're asking for back stops. How do you manage a billion dollars in debt? Debt sounds scary. A lot of startups don't use debt. How why are you confident that debt makes sense in this in this world?

You know, I think for us it's all about the success of the platform. We've just scaled to such a significant rate. We're doing now over $5 billion of payments. We have over 20 million members on our platform.

It's given our scale, given our free cash flow profile, we're confident we can service the debt and we're confident that we continue to scale into new verticals. Do you think about matching the capital structure to the shape of the business? Is it important to have uh debt backed by physical assets or something?

How do you think about the financial engineering that you're doing? Yeah, it's a good question. And you know, for us, it's all about the lowest cost of capital, the lowest dilution with the right partners that can facilitate the strongest level of long-term sustained growth. For us, it's all about growth. Yeah.

And what and what are the growth levers right now? Because uh some some people when they want to grow, they go film a vibe reel. I imagine you're not uh filming $1. 6 billion worth of vibe reels and trying to go viral every day. This isn't the clue. It's all my vibe coding. Voding vibe.

[laughter] But but I I honestly would imagine that uh $1. 1 billion of debt that's not even going towards R&D because that's something that if there's risky R&D, you'd want to be funding that with equity. Uh walk through some of the growth levers that you're pulling over the next couple years.

So I think Jordy and John, one of the last times we connected, we were pioneering the growth pie out. This idea that we could take a legacy old world business and we could acquire it directly by a traditional technology company. Yeah.

Right now, we're pioneering something brand new, which we're qualifying as the recognition economy. This idea that we can leverage AI and computer vision in the real world to drive seamless payment and commerce experiences everywhere. And we've proven that with parking.

Now, we're scaling into gas stations, car wash, quickserve retail. Soon you'll see our technology moving with you from a biometrics perspective into hotels uh and into other environments where you can facilitate seamless access and payments.

So you're when you go and buy a company, obviously there's an established business, so that's accelerated. Then you're trying to use AI to accelerate growth and cut costs. How do you think about what you actually do as you build the portfolio?

So we don't really look at it from a cost cutting perspective or a cost synergy perspective. It's all about revenue synergy. It's all about how do we drive gross profit and it's all about how we work with our partners to drive revenue to their businesses. So, it's all about revenue synergy.

Everything for us is about sustained revenue growth. I think too many companies think about cost synergies. Too many private equity firms think about cost synergies and short-term gains. For us, it's all about long-term gains driven through revenue. Do you think too many private equity firms think like that?

I feel like there's a rule there's a world for both.

Like I've studied like we've talked about private equity like titans people have been in the business for decades where their whole model is uh you know they take a big company private change the business model grow it a ton IPO it again then there's sort of the bottom feeders that are picking up scraps and cutting costs even more and I don't necessarily know that every company is built to grow forever.

I I actually am somewhat receptive to the idea that some companies like they've just done their job and they just kind of need to like go out to pasture and retire and the company's retiring and so I think that they that that type of private equity guy gets a bad rap but again I'll defend every private equity guy because I love private equity [laughter] so yeah he came I I love private equity as well but I think the capital markets has a natural inclination to operate within boxes and once you go outside that box once you create a model where you're actually taking a techn technology business and acquiring old world businesses that doesn't fit in a traditional box.

And you have to take creative investors. You have to take best-in-class investors like Todd Bolley, Tony Manila, you have to work with players like Rier Burkoff that can think outside of the box and think how they can mitigate or create what I'd say is an asymmetric return profile.

So all the downside risk mitigation of a traditional private equity play with all the upside potential of a traditional venture capital play.

I I have to double click on on you you talked about biometric payments in retail quick service hotels I think you said fueling fueling what does that actually look like uh in practice today?

What are what are some of these biometric payment is when you're you're checking out and they take a pint of your blood and they run it through a centrifuge bank. A little more of a pint. [laughter] Look, think about how much of our lives we spend wasting time Yeah. checking out at a grocery store.

Think about every time you go to a meeting in New York or waiting to get in to a class A office building, showing your ID to a stranger, giving all your privacy information over that actually ID has your address on.

Think about a future where you just belong, where you can seamlessly walk into any class A office building. Think about a future where you go into your coffee shop and they just know what you want because you always order the same cup of coffee.

So, how can you leverage computer vision to create a new paradigm in privacy and reduction of fraud through leveraging biometrics? And that's exactly what we're doing. Yeah, I feel like this kind of already I you hear you see glimpses of this in China and Japan and different Amazon's experimented with it.

What do you think the the key to success will be in in terms of like you know the we have we have the technology. Yeah. My question here is like do we need the technology the models to get better? Is it an implementation problem or is it you need to buy a series of services and just implement them effectively?

I think more than anything you need to build trust and a dynamic with a consumer base. So right now we're crossing 20 million members on our platform that are leveraging our technology every single day to facilitate seamless access and payment at over 4200 locations across the United States. It's that trust.

It's that empowerment. It's that seamless access that people want to come back to time and time again so they're no longer wasting time. And if you have that network and if you have that flywheel, I think that's the the core ingredient. Yeah. In order to scale into new verticals.

Are you on a collision course with Clear at all? The the biometrics. I don't know. There's something there. The chat was asking. No, it's a it's a it's a good question.

I'll tell you, I think Clear has done a remarkable job at a very specific use case and I think Karen and their team have built a remarkable product and I think that we're very focused on mobility right now as it pertains to gas stations, car wash, quickserve retail, parking anytime a transaction is facilitated in a vehicle and then we're moving past the vehicle.

But I think what that team done has done is really unique as tied to identity and we're scaling into additional and differentiated verticals. Yeah. Differentiated versus different problem. Yeah.

Very cool to think about a world where you can drive through um uh you know drive through a restaurant uh or just I like Ryan here in the chat who says, "I will make it impossible for AI to ever guess my coffee order.

He's going to keep the clankers guessing different world where you can drive drive through a drive-thru and just be like, "This is what I And then you just drive forward and they hand it to you and you never have to do the whole like, you know, mobile payment. You're reaching out of your car or whatever.

So, uh, imagine a world if it just, you know, could be precognitive. Knew what you wanted before you ordered it. Be pretty fast. Yeah. Work for everyone except for Ryan in the chat. But, [laughter] uh, thank you. Thank you so much for joining. Massive milestone for you and see you guys in LA. Talk soon. See you.

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Um until then we'll bring in our next guest Paul from FOMO benchmark's latest investment. What's happening? How you doing Paul? Good to meet you. Welcome to the show. Great. Great to meet you guys. Welcome to the show. Introduce the company. give us the elevator pitch that you gave to