i3 Verticals, Inc. (IIIV): History, Ownership, Mission, How It Works & Makes Money

i3 Verticals, Inc. (IIIV) just wrapped a pivotal year, so how is this integrated software provider-now focused purely on the public sector-carving out its niche in a market demanding modernization?

Following the strategic divestiture of its non-core businesses, the company reported full fiscal year 2025 revenue from continuing operations of $213.2 million, an 11.5% jump, proving the focused shift is defintely paying off. You need to understand the forces driving this new pure-play model, especially when CEO Gregory S. Daily holds a significant 22.26% ownership stake, aligning leadership incentives directly with shareholder value. Let's break down the history, the mission, and precisely how they translate a $57.5 million adjusted EBITDA into a compelling growth story.

i3 Verticals, Inc. (IIIV) History

If you're looking at i3 Verticals, Inc. (IIIV), you're looking at a classic payments-industry veteran's pivot into high-margin vertical market software, a strategy that drove fiscal year 2025 revenue from continuing operations to $213.2 million. The company's journey is less about a single revolutionary product and more about a relentless, acquisition-led consolidation play in non-discretionary sectors like government and education.

Given Company's Founding Timeline

Year established

The operating entity, i3 Verticals, LLC, was organized in September 2012, with the holding company, i3 Verticals, Inc., forming in January 2018 specifically for the IPO.

Original location

Nashville, Tennessee, which remains the company's headquarters.

Founding team members

The company was founded by Greg Daily, who serves as Chairman and CEO, leveraging his deep, two-decade-plus experience in the payments industry to execute a clear vision for integrated software and payments.

Initial capital/funding

i3 Verticals was initiated with private capital to fuel an aggressive, acquisition-led growth strategy. The company has since raised a total of $42.1 million in funding across seven rounds prior to a significant post-IPO round of $138 million in February 2020.

Given Company's Evolution Milestones

Given Company's Transformative Moments

The biggest transformative moment for i3 Verticals wasn't a single product launch; it was the strategic decision to prioritize software over pure payments. This is the difference between being a commodity processor and a sticky, mission-critical partner.

The IPO in 2018 was a huge accelerant. Raising $92.5 million in net proceeds gave the management team the currency and scale to accelerate their roll-up strategy, moving beyond small tuck-ins to larger, platform-level acquisitions. Honestly, the entire history is a series of M&A events.

The most recent shift, clearly visible in the fiscal 2025 results, is the focus on the Public Sector. This is a smart move because government, education, and utilities payments are non-discretionary and counter-cyclical, providing a defintely more stable recurring revenue base. Annualized Recurring Revenue (ARR) from continuing operations hit $165.3 million in Q4 2025, which is a key metric showing the success of this transition.

• Shift to Vertical Software: Early on, they recognized that the real moat (competitive advantage) was embedding payments into specialized software, not just processing transactions.

• The Public Sector Focus: They've effectively transitioned to a pure-play software provider for the public sector, focusing on transformational solutions in government functions.

• Balance Sheet Strength: As of the Q4 2025 earnings call, the company reported a strong balance sheet with $67 million in cash and no debt, giving them flexibility for future acquisitions or organic investment.

This strategic focus on integrated software and payment solutions in niche markets is what underpins the company's valuation. For a deeper dive into who is betting on this strategy, you should check out Exploring i3 Verticals, Inc. (IIIV) Investor Profile: Who's Buying and Why?

i3 Verticals, Inc. (IIIV) Ownership Structure

i3 Verticals, Inc. (IIIV) operates with an ownership structure heavily weighted toward institutional investors, which is typical for a publicly traded, growth-oriented technology company, but still maintains a substantial insider stake. This dual structure means the company is primarily governed by the market's collective institutional voice, but the leadership team has significant skin in the game, which defintely aligns their interests with long-term shareholder value.

You can see the full picture of the company's financial health, including key Q4 2025 metrics, by reading Breaking Down i3 Verticals, Inc. (IIIV) Financial Health: Key Insights for Investors.

Given Company's Current Status

As of November 2025, i3 Verticals, Inc. is a publicly traded company listed on the Nasdaq Global Select Market under the ticker symbol IIIV. The company's market capitalization stands at approximately $0.84 Billion USD, reflecting its position as a mid-cap player in the integrated software and payments space. The company recently reported its full fiscal year 2025 results, with total revenue for the year growing over 11%, and Q4 2025 revenue reaching $54.9 million.

Given Company's Ownership Breakdown

The ownership structure is dominated by institutional funds, which hold the majority of the shares, but a significant portion remains with company insiders. This concentration of insider ownership, particularly by the CEO, is a strong signal of conviction in the company's long-term strategy.

Here's the quick math on the largest individual stake: Chairman and CEO Gregory S. Daily holds 7,183,288 shares, representing 22.26% of the company, a stake valued at over $207.24 million based on a recent share price of $28.85 as of November 2025. That's a massive personal commitment.

Given Company's Leadership

The company is steered by an experienced leadership team, with an average tenure of 2.5 years for the management team and 7.8 years for the Board of Directors, as of late 2025. This blend of fresh operational perspectives and long-standing board oversight provides a stable governance framework.

• Gregory Daily: Chairman and Chief Executive Officer (CEO). He is the founder and largest individual shareholder, driving the strategic vision.
• Rick Stanford: President. He oversees the company's operational execution.
• Geoff Smith: Chief Financial Officer (CFO). Responsible for financial strategy and reporting, with a reported total compensation of $1.38 million in the last reported period.
• Clay Whitson: Chief Strategy Officer (CSO) & Director. He focuses on long-term growth initiatives and acquisitions.
• Paul Christians: Chief Revenue Officer (CRO). He leads the sales and revenue generation efforts.
• Michael O'Keefe: Chief Technology Officer (CTO). He manages the core technology and product development.
• Chad Fenner: Chief Product Officer (CPO). He focuses on the product roadmap, especially for the core public sector software offerings.

i3 Verticals, Inc. (IIIV) Mission and Values

i3 Verticals, Inc.'s core purpose transcends simple profit by focusing on enabling critical public sector functions through specialized software, driving efficiency for government entities and the citizens they serve. This mission, backed by strong fiscal year 2025 performance, positions the company as a pure-play software provider with a clear, socially impactful mandate.

The company's strategic focus, especially after divesting its Merchant Services and Healthcare Revenue Cycle Management businesses, is now squarely on the public sector, which is why their mission is so specific. They have a strong balance sheet, reporting $67 million in cash and no debt as of the end of fiscal year 2025, giving them the flexibility to execute on this mission through internal development and strategic mergers and acquisitions (M&A). Exploring i3 Verticals, Inc. (IIIV) Investor Profile: Who's Buying and Why?

Given Company's Core Purpose

Official Mission Statement

The mission of i3 Verticals, Inc. is to enable state and local governments and related agencies to perform their functions and serve their constituents as effectively and efficiently as possible. It's a clear, public-good-oriented goal. Here's the quick math on their commitment: their full year 2025 revenue from continuing operations was $213.2 million, an 11.5% increase over the prior year, showing their focus is generating real returns.

• Provide mission-critical enterprise software solutions to public sector entities.
• Deliver comprehensive cloud-native solutions for government functions like courts, public safety, and public administration.
• Expand market presence through strategic acquisitions and organic growth in vertical markets.

Vision Statement

Honestly, i3 Verticals, Inc. doesn't publish a separate, consolidated vision statement; instead, they embed their long-term aspiration within their mission and operating principles. Their actions, though, paint a clear picture of their vision: to be the leader in the public sector vertical, providing transformational solutions across all 50 states and Canada.

The financial results for fiscal year 2025 defintely support this vision, with Annualized Recurring Revenue (ARR) from continuing operations hitting $165.3 million in Q4, a 9.2% growth rate, and recurring revenue making up 75% of the quarter's total revenue. That kind of predictable revenue stream is the foundation for long-term dominance.

Given Company Slogan/Tagline

While the company doesn't use a catchy, consumer-facing tagline, their operational mantra is clearly about delivering essential, high-value technology to a complex market. If I had to distill their core value proposition into a simple phrase, it would be:

• Transforming Government Functions.

Their focus on Software as a Service (SaaS) is a key part of this transformation, with SaaS revenue growing a healthy 23% in the fourth quarter of 2025, which is a great sign of their investment in innovation and future-proofing their solutions.

i3 Verticals, Inc. (IIIV) How It Works

i3 Verticals, Inc. works by providing mission-critical enterprise software and integrated payment solutions almost exclusively to the public sector, helping government entities modernize their operations and manage significant transaction volumes. The company's strategic focus on recurring Software as a Service (SaaS) revenue drove its full fiscal year 2025 revenue from continuing operations to $213.2 million, an 11.5% increase over the prior year.

i3 Verticals, Inc.'s Product/Service Portfolio

i3 Verticals, Inc.'s Operational Framework

The operational framework of i3 Verticals, Inc. is centered on a 'build, buy, and integrate' strategy, now streamlined to focus on the high-margin Public Sector vertical after divesting the Merchant Services and Healthcare RCM businesses in fiscal year 2025. This focus on 'RemainCo' operations is key to value creation.

The company generates value through a recurring revenue model, which is the best defintely predictor of long-term growth. Annualized Recurring Revenue (ARR) from continuing operations grew to $165.3 million in Q4 2025, a 9.2% increase year-over-year. Here's the quick math: over 76% of Q2 2025 revenue came from recurring sources, showing the stability of the model. They are a pure-play software solutions provider now.

• Acquire and Integrate: Buy smaller, specialized software companies with deep vertical expertise (like the utility billing acquisition in April 2025) and integrate their solutions with i3 Verticals, Inc.'s robust payment platform.
• Drive SaaS Adoption: Prioritize the sale of cloud-native, subscription-based Software as a Service (SaaS) solutions, which saw a 23% revenue growth in fiscal year 2025.
• Cross-Sell Payments: Embed electronic payment processing capabilities directly into the mission-critical software, monetizing the transaction volume generated by the software itself.
• Invest for Future Growth: Accelerate investments in new solutions, particularly within the JusticeTech and Utility offerings, which is expected to temper some short-term growth but build long-term competitive differentiation.

For more on the capital behind this strategy, check out Exploring i3 Verticals, Inc. (IIIV) Investor Profile: Who's Buying and Why?

i3 Verticals, Inc.'s Strategic Advantages

i3 Verticals, Inc.'s market success is rooted in its deep specialization and financial discipline, which creates high barriers to entry for competitors.

• Vertical Expertise and Stickiness: Focus on the Public Sector means their software is 'mission-critical' and deeply embedded in government workflows, leading to high client retention and a predictable revenue base.
• High Recurring Revenue Mix: The shift to a pure-play public sector model with $165.3 million in ARR provides a strong foundation, mitigating the volatility of non-recurring project revenues.
• Strong Balance Sheet for M&A: Following the divestitures, the company has a strong balance sheet with approximately $67 million in cash and no debt, providing significant flexibility to fund future, opportunistic acquisitions.
• Integrated Software and Payments: Offering both the core operational software and the payment processing-a combination few competitors can match-creates a powerful, single-vendor solution for government agencies.
• Profitability and Margin Improvement: Adjusted EBITDA for the full fiscal year 2025 reached $57.5 million, with an improved margin of 27.0%, demonstrating efficient cost management following the strategic divestitures.

i3 Verticals, Inc. (IIIV) How It Makes Money

i3 Verticals, Inc. (IIIV) primarily makes money by providing mission-critical enterprise software solutions, mostly on a subscription basis, to public sector entities like courts, utilities, and public safety organizations. The company's revenue engine is shifting from transactional payment processing to a more predictable Software-as-a-Service (SaaS) model, securing long-term, sticky government contracts. Exploring i3 Verticals, Inc. (IIIV) Investor Profile: Who's Buying and Why?

i3 Verticals' Revenue Breakdown

The company is transitioning to a pure-play software provider, which means its revenue is increasingly dominated by recurring subscription fees rather than one-time sales or lower-margin services. Here's the quick math: Annualized Recurring Revenue (ARR) hit $165.3 million in the fourth quarter of fiscal year 2025, which is a strong indicator of the recurring portion of the total annual revenue of $213.2 million.

The total revenue for the fiscal year ended September 30, 2025, was $213.2 million, an increase of 11.5% over the prior year. The Recurring Revenue stream, driven by the SaaS segment, is the clear growth driver, with SaaS revenue jumping 23% in Q4 2025 alone. Non-recurring revenue, which includes professional services for implementation, is expected to see a lighter cadence in 2026 as the company prioritizes recurring sources.

Business Economics

The economics of i3 Verticals are defined by high gross margins and a strategic focus on the public sector, which generally means very low customer churn. Once a government entity adopts a new case management or utility billing system, they defintely don't switch easily.

• Pricing Power: The company has historically been conservative but is now aiming for consistent annual price increases of 3% to 5%. Price increases contributed 1% to 2% of the total growth in fiscal year 2025.
• High Gross Margin: The gross margin stands at an impressive 87.21%. This shows the inherent profitability of selling proprietary software, especially with a subscription model where the cost of goods sold (COGS) is low relative to the revenue.
• Low Churn/High Retention: The focus on 'mission-critical' software for the public sector creates a deep moat (a competitive advantage). The Net Dollar Retention Rate was 104% in Q4 2025, meaning existing customers are not only staying but also increasing their spending by 4% on average.
• Operating Leverage: The Adjusted EBITDA as a percentage of revenue expanded to 27.0% for the full fiscal year 2025, up from 26.4% in the prior year, indicating that revenue growth is outpacing the growth in operating expenses.

i3 Verticals' Financial Performance

The fiscal year 2025 results show a company successfully executing a pivot to a more profitable, recurring revenue model, even as it invests heavily in new solutions for courts and utilities. The key financial metrics are strong indicators of this transition and overall business health.

• Profitability Turnaround: Full-year Net Income from continuing operations was $5.6 million for fiscal 2025, a significant turnaround from a net loss of $16.0 million in the prior year.
• Adjusted EBITDA Growth: Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) for the full year was $57.5 million, representing a solid 14.0% increase over the prior year.
• Earnings Per Share: Adjusted diluted earnings per share (EPS) from continuing operations was $1.05 for the full fiscal year 2025, a substantial jump from $0.30 in the prior year.
• Balance Sheet Strength: The company maintains a strong balance sheet, reporting $67 million in cash and no debt as of the end of fiscal 2025, providing flexibility for future mergers and acquisitions (M&A) or internal development.

i3 Verticals, Inc. (IIIV) Market Position & Future Outlook

i3 Verticals is strategically positioned as a pure-play software solutions provider for the resilient public sector, a pivot that drove 11% revenue growth for the fiscal year 2025, but you should anticipate near-term volatility as the company executes its full transition to a Software-as-a-Service (SaaS) model. The company's future hinges on successfully cross-selling its integrated payment solutions into its deep vertical software base, particularly in Justice and Utilities, while managing the expected decline in non-recurring professional services revenue in fiscal 2026.

Competitive Landscape

In the broader integrated payments and vertical software (VMS) space, i3 Verticals is a niche player, but its focus on non-discretionary government functions gives it a defensible position against much larger, more diversified competitors. Its primary advantage is the deep integration of payments within specialized public sector software, which creates high switching costs for clients.

Opportunities & Challenges

The company's strategic pivot presents clear opportunities for margin expansion long-term, but you need to be mindful of the transitional risks that are already impacting the fiscal year 2026 outlook. The shift away from high-margin, non-recurring software license sales to lower-margin professional services and then to recurring SaaS revenue is the core of this transitional pain.

Industry Position

i3 Verticals has successfully streamlined its operations into a single, focused public sector segment, a move that is defintely a long-term positive for clarity and execution. The full fiscal year 2025 results showed net income from continuing operations of $5.6 million, a significant turnaround from the prior year's net loss. That's a good sign of fundamental health.

The company's focus on vertical market software (VMS) with embedded payments is a powerful model because it captures both the subscription revenue and the transaction fee, making the customer relationship sticky. This is why the net dollar retention for fiscal 2025 was a healthy 104%. The Justice market is its largest, contributing approximately 25% of revenues, giving it a strong foothold for future expansion in adjacent public safety solutions.

• Focus on Justice, Utilities, Transportation, Education, and Public Administration.
• Recurring revenue made up 75% of total revenues in Q4 2025.
• Organic revenue growth of 8.4% for the year shows the core business is strong.
• Merger and acquisition (M&A) execution is expected to continue supporting growth, building on the recent utility billing acquisition in April 2025.

Understanding the full picture requires a look at the core numbers; you can find a deeper dive into the metrics here: Breaking Down i3 Verticals, Inc. (IIIV) Financial Health: Key Insights for Investors.