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Apr 2, 2024 · 31m · top-founders

39 Year Old Made $21m Last Year Selling Surprising Software

Austin McNair · 18m spoken Nathan Latka · 9m spoken
0:00 / 0:00

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In this episode of Conversations with Nathan Latka, host Nathan Latka interviews Austin McNabb, founder and CEO of VisiPay, exploring how he bootstrapped a rural-focused payment processing and point-of-sale company to over $21 million in revenue. McNabb details his disciplined go-to-market strategy, hardware investments in Clover systems, and non-dilutive debt financing that enabled massive scale while preserving near-100% equity ownership.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 33.7% of the talking time here. How this is scored →

Nathan as informed peer 6.0 Guest teaching 2.9 Guest disagreement 1.1 Nathan pushing back 3.1
05100:0010:0020:0030:001:38–7:13 · Nathan as informed peer 6/10 Introducing Austin McNabb and Targeting Rural Small Businesses Nathan recalls historical revenue numbers from their prior interview and directly presses Austin on falling short of his $27M target. Austin takes the critique in stride, candidly explaining the 19% growth achieved and why they missed the forecast.7:13–12:07 · Nathan as informed peer 6/10 Evaluating W-2 vs 1099 Models and Shifting to Profitability Nathan probes sales ramp dynamics, AE quota expectations, and model assumptions. Austin explains the economics of W-2 versus 1099 reps and candidly admits overhiring without realizing it was hurting unit economics.12:07–17:10 · Nathan as informed peer 8/10 Bootstrapping Growth with Community Bank Debt Nathan drills into how a bootstrapped founder finances negative cash flow, examining bank debt mechanics, personal guarantees, and SOFR spreads. Austin details pitching a conservative community bank board using processing residual metrics.17:11–20:50 · Nathan as informed peer 7/10 Scaling Payment Volume via Clover Hardware Investment Nathan verifies processing volumes and calculates required transaction growth per month based on average swipe size. Austin explains seasonality in rural merchants and why investing in Clover hardware boosts retention and volume.20:51–25:37 · Nathan as informed peer 8/10 Contractor Residuals, Unit Economics, and Buyout Arbitrage Nathan analyzes 1099 commission structures and pitches buyout arbitrage to improve margins before M&A. Austin clarifies that net residual payout is 43% rather than 50% due to account callbacks and details historical buyout multiples.25:37–27:55 · Nathan as informed peer 4/10 Software Expansion on Clover and 2024 Projections Nathan asks for upcoming product roadmaps and parses conservative versus stretch revenue targets. Austin outlines app development on top of Fiserv's Clover ecosystem and internal CRM developments.27:56–29:55 · Nathan as informed peer 3/10 The Famous Five Rapid-Fire Questions Standard Famous Five closing segment where Nathan moves quickly through personal and business background questions with collaborative, lighthearted answers from Austin.1:38–7:13 · Guest teaching 2/10 Introducing Austin McNabb and Targeting Rural Small Businesses Nathan recalls historical revenue numbers from their prior interview and directly presses Austin on falling short of his $27M target. Austin takes the critique in stride, candidly explaining the 19% growth achieved and why they missed the forecast.7:13–12:07 · Guest teaching 3/10 Evaluating W-2 vs 1099 Models and Shifting to Profitability Nathan probes sales ramp dynamics, AE quota expectations, and model assumptions. Austin explains the economics of W-2 versus 1099 reps and candidly admits overhiring without realizing it was hurting unit economics.12:07–17:10 · Guest teaching 4/10 Bootstrapping Growth with Community Bank Debt Nathan drills into how a bootstrapped founder finances negative cash flow, examining bank debt mechanics, personal guarantees, and SOFR spreads. Austin details pitching a conservative community bank board using processing residual metrics.17:11–20:50 · Guest teaching 3/10 Scaling Payment Volume via Clover Hardware Investment Nathan verifies processing volumes and calculates required transaction growth per month based on average swipe size. Austin explains seasonality in rural merchants and why investing in Clover hardware boosts retention and volume.20:51–25:37 · Guest teaching 4/10 Contractor Residuals, Unit Economics, and Buyout Arbitrage Nathan analyzes 1099 commission structures and pitches buyout arbitrage to improve margins before M&A. Austin clarifies that net residual payout is 43% rather than 50% due to account callbacks and details historical buyout multiples.25:37–27:55 · Guest teaching 3/10 Software Expansion on Clover and 2024 Projections Nathan asks for upcoming product roadmaps and parses conservative versus stretch revenue targets. Austin outlines app development on top of Fiserv's Clover ecosystem and internal CRM developments.27:56–29:55 · Guest teaching 1/10 The Famous Five Rapid-Fire Questions Standard Famous Five closing segment where Nathan moves quickly through personal and business background questions with collaborative, lighthearted answers from Austin.1:38–7:13 · Guest disagreement 1/10 Introducing Austin McNabb and Targeting Rural Small Businesses Nathan recalls historical revenue numbers from their prior interview and directly presses Austin on falling short of his $27M target. Austin takes the critique in stride, candidly explaining the 19% growth achieved and why they missed the forecast.7:13–12:07 · Guest disagreement 2/10 Evaluating W-2 vs 1099 Models and Shifting to Profitability Nathan probes sales ramp dynamics, AE quota expectations, and model assumptions. Austin explains the economics of W-2 versus 1099 reps and candidly admits overhiring without realizing it was hurting unit economics.12:07–17:10 · Guest disagreement 1/10 Bootstrapping Growth with Community Bank Debt Nathan drills into how a bootstrapped founder finances negative cash flow, examining bank debt mechanics, personal guarantees, and SOFR spreads. Austin details pitching a conservative community bank board using processing residual metrics.17:11–20:50 · Guest disagreement 1/10 Scaling Payment Volume via Clover Hardware Investment Nathan verifies processing volumes and calculates required transaction growth per month based on average swipe size. Austin explains seasonality in rural merchants and why investing in Clover hardware boosts retention and volume.20:51–25:37 · Guest disagreement 1/10 Contractor Residuals, Unit Economics, and Buyout Arbitrage Nathan analyzes 1099 commission structures and pitches buyout arbitrage to improve margins before M&A. Austin clarifies that net residual payout is 43% rather than 50% due to account callbacks and details historical buyout multiples.25:37–27:55 · Guest disagreement 1/10 Software Expansion on Clover and 2024 Projections Nathan asks for upcoming product roadmaps and parses conservative versus stretch revenue targets. Austin outlines app development on top of Fiserv's Clover ecosystem and internal CRM developments.27:56–29:55 · Guest disagreement 1/10 The Famous Five Rapid-Fire Questions Standard Famous Five closing segment where Nathan moves quickly through personal and business background questions with collaborative, lighthearted answers from Austin.1:38–7:13 · Nathan pushing back 5/10 Introducing Austin McNabb and Targeting Rural Small Businesses Nathan recalls historical revenue numbers from their prior interview and directly presses Austin on falling short of his $27M target. Austin takes the critique in stride, candidly explaining the 19% growth achieved and why they missed the forecast.7:13–12:07 · Nathan pushing back 3/10 Evaluating W-2 vs 1099 Models and Shifting to Profitability Nathan probes sales ramp dynamics, AE quota expectations, and model assumptions. Austin explains the economics of W-2 versus 1099 reps and candidly admits overhiring without realizing it was hurting unit economics.12:07–17:10 · Nathan pushing back 4/10 Bootstrapping Growth with Community Bank Debt Nathan drills into how a bootstrapped founder finances negative cash flow, examining bank debt mechanics, personal guarantees, and SOFR spreads. Austin details pitching a conservative community bank board using processing residual metrics.17:11–20:50 · Nathan pushing back 3/10 Scaling Payment Volume via Clover Hardware Investment Nathan verifies processing volumes and calculates required transaction growth per month based on average swipe size. Austin explains seasonality in rural merchants and why investing in Clover hardware boosts retention and volume.20:51–25:37 · Nathan pushing back 4/10 Contractor Residuals, Unit Economics, and Buyout Arbitrage Nathan analyzes 1099 commission structures and pitches buyout arbitrage to improve margins before M&A. Austin clarifies that net residual payout is 43% rather than 50% due to account callbacks and details historical buyout multiples.25:37–27:55 · Nathan pushing back 2/10 Software Expansion on Clover and 2024 Projections Nathan asks for upcoming product roadmaps and parses conservative versus stretch revenue targets. Austin outlines app development on top of Fiserv's Clover ecosystem and internal CRM developments.27:56–29:55 · Nathan pushing back 1/10 The Famous Five Rapid-Fire Questions Standard Famous Five closing segment where Nathan moves quickly through personal and business background questions with collaborative, lighthearted answers from Austin.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 76.5% · guest 23.5%0:00 · Nathan 76.5% · guest 23.5%3:00 · Nathan 37.1% · guest 62.9%3:00 · Nathan 37.1% · guest 62.9%6:00 · Nathan 31.4% · guest 68.6%6:00 · Nathan 31.4% · guest 68.6%9:00 · Nathan 17.8% · guest 82.2%9:00 · Nathan 17.8% · guest 82.2%12:00 · Nathan 15.7% · guest 84.3%12:00 · Nathan 15.7% · guest 84.3%15:00 · Nathan 29% · guest 71%15:00 · Nathan 29% · guest 71%18:00 · Nathan 23.7% · guest 76.3%18:00 · Nathan 23.7% · guest 76.3%21:00 · Nathan 29.3% · guest 70.7%21:00 · Nathan 29.3% · guest 70.7%24:00 · Nathan 25.3% · guest 74.7%24:00 · Nathan 25.3% · guest 74.7%27:00 · Nathan 29% · guest 71%27:00 · Nathan 29% · guest 71%30:00 · Nathan 96.9% · guest 3.1%30:00 · Nathan 96.9% · guest 3.1%
Sharpest disagreement ▶ 11:03 Austin rejects standard headcount-to-sales premise

Austin forcefully reframes conventional sales thinking, emphatically swearing and stating that assuming more sales bodies automatically equals more revenue is completely false.

 Hardest push from Nathan ▶ 4:31 Nathan challenges Austin on the $5.5M revenue target miss

Nathan refuses to let the topline growth mask the miss, pointing out Austin projected $27M in their prior interview but closed at $21.5M, and demands to know how he justified that gap to his team.

 Biggest teaching moment ▶ 23:27 Austin clarifies true gross margin and deduction callbacks

Austin educates Nathan on industry mechanics by correcting his 50% margin estimate, showing that deductions and callbacks reduce net contractor payout to 43%.

 Nathan holds their own ▶ 15:52 Nathan lays out equity creation math via low-cost debt

Nathan showcases sophisticated financial expertise by calculating on the fly how taking $1.5M in non-dilutive bank debt generated $3M in ARR, yielding $30M in enterprise equity value at a 10x ARR multiple.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Austin McNabb and Targeting Rural Small Businesses 6215 Nathan recalls historical revenue numbers from their prior interview and directly presses Austin on falling short of his $27M target. Austin takes the critique in stride, candidly explaining the 19% growth achieved and why they missed the forecast.
Evaluating W-2 vs 1099 Models and Shifting to Profitability 6323 Nathan probes sales ramp dynamics, AE quota expectations, and model assumptions. Austin explains the economics of W-2 versus 1099 reps and candidly admits overhiring without realizing it was hurting unit economics.
Bootstrapping Growth with Community Bank Debt 8414 Nathan drills into how a bootstrapped founder finances negative cash flow, examining bank debt mechanics, personal guarantees, and SOFR spreads. Austin details pitching a conservative community bank board using processing residual metrics.
Scaling Payment Volume via Clover Hardware Investment 7313 Nathan verifies processing volumes and calculates required transaction growth per month based on average swipe size. Austin explains seasonality in rural merchants and why investing in Clover hardware boosts retention and volume.
Contractor Residuals, Unit Economics, and Buyout Arbitrage 8414 Nathan analyzes 1099 commission structures and pitches buyout arbitrage to improve margins before M&A. Austin clarifies that net residual payout is 43% rather than 50% due to account callbacks and details historical buyout multiples.
Software Expansion on Clover and 2024 Projections 4312 Nathan asks for upcoming product roadmaps and parses conservative versus stretch revenue targets. Austin outlines app development on top of Fiserv's Clover ecosystem and internal CRM developments.
The Famous Five Rapid-Fire Questions 3111 Standard Famous Five closing segment where Nathan moves quickly through personal and business background questions with collaborative, lighthearted answers from Austin.

Statements from this episode (17)

Disclosure
VisiPay bootstrapped its payment processing business by targeting rural communities
“That's been kind of our differentiator since we started, and that's, I think, helped us excel to the next level, being bootstrapped from the beginning till today, is we are focused strictly on, you know, rural American communities, which we believe technology …”
Austin McNair Apr 2, 2024 ▶ 2:21
Opinion
Large payment providers neglect rural businesses in favor of large cities
“Big companies, and you can probably name them, you know, a couple of them that are on the stock market or not, that their focus has to be in bigger companies. Cities where there's more transactions, bigger population, more payment processing, because they actu…”
Austin McNair Apr 2, 2024 ▶ 2:38
Assertion Not checkable as stated
VisiPay grew revenue 19% to $21.5M in 2023
“From 2022 to 2023, our growth is about 19%. So we went from eighteen million to about 21.5 million in revenue.”
Austin McNair Apr 2, 2024 ▶ 4:00
Prediction Not checkable as stated
VisiPay projects $26.5M revenue in 2024
“This year we're anticipating to do around 26 and a half is kind of our revenue projections and goals is another 23% increase we're looking to do.”
Austin McNair Apr 2, 2024 ▶ 4:08
Assertion Not checkable as stated
McNabb: 95% of VisiPay's 100 staff had zero industry experience
“We hired about 95% of our staff. That have no industry experience whatsoever out of almost a hundred employees.”
Austin McNair Apr 2, 2024 ▶ 6:14
Assertion Not checkable as stated
McNabb: Full-time W-2 sales reps take six to eight months to achieve ROI
“So what we found out was it takes about six to eight months for ROI on a W two employee to make the money back when it comes down to what we're paying them salary wise, plus, you know, commissions, whatever that's kind of separated.”
Austin McNair Apr 2, 2024 ▶ 10:43
Insight
McNabb: Increasing sales headcount does not equate to more sales
“We thought more bodies equated to more sales when that's fucking not true. That's not true.”
Austin McNair Apr 2, 2024 ▶ 11:15
Disclosure
McNabb: VisiPay plans to hire no more than two people in 2024
“This year, our goal is to hire no more than like two people. Our goal is not to hire a bunch of people this year.”
Austin McNair Apr 2, 2024 ▶ 11:50
Disclosure
Austin McNabb: VisiPay took a $1.5 million loan from a community bank
“Last year was 1.5 million. We worked with the bank on and we worked with them based on our projections and based on our current revenue growth, et cetera.”
Austin McNair Apr 2, 2024 ▶ 13:16
Disclosure
Austin McNabb personally guaranteed VisiPay's $1.5 million bank debt
“Did you have to sign a personal guarantee? [904] Austin McNabb: Absolutely.”
Austin McNair Apr 2, 2024 ▶ 15:01
Disclosure
Austin McNabb: VisiPay hired the banker who facilitated its loan as CFO
“I mean, the very person that helped us is now our CFO. It's kind of crazy how that works. So a small world, right? So now the very person that understood everything about us is now currently today our CFO.”
Austin McNair Apr 2, 2024 ▶ 16:35
Disclosure
VisiPay invested nearly $1M directly into Clover POS hardware
“You know, we basically put almost a million dollars into equipment because we saw it work last year.”
Austin McNair Apr 2, 2024 ▶ 17:45
Assertion Not checkable as stated
VisiPay processed $1.85B across 35M transactions in 2023
“Last year, we did a 1.85 billion, thirty five million transactions.”
Austin McNair Apr 2, 2024 ▶ 18:41
Assertion Not checkable as stated
McNabb: VisiPay has over 125 active 1099 reps and ~500 in training
“We have over a 125 to act of 1089 across the United States. And we have probably close to 500 in training.”
Austin McNair Apr 2, 2024 ▶ 20:59
Assertion Not checkable as stated
McNabb: VisiPay paid nearly $1M in monthly sales residuals
“Last, last month alone, we paid well, close to a million dollars of residuals out to W-twos and T-Nine-Nines.”
Austin McNair Apr 2, 2024 ▶ 22:21
Assertion Not checkable as stated
McNabb: VisiPay reduced residual payout rate from 52% to 43%
“The current market for us revenue streaming out in total when it comes out and that is about 43%, by the way, just because when you incorporate everything, there's deduction callbacks because, you know, accounts cancel, whatever, maybe it's about 43%. But anyw…”
Austin McNair Apr 2, 2024 ▶ 23:28
Assertion Not checkable as stated
Austin McNabb: VisiPay has signed over 13,000 merchant clients
“Today we're a little, we've signed over 13 plus thousand clients.”
Austin McNair Apr 2, 2024 ▶ 27:44
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