Shift4 Payments CEO on trading debut: 'It's been a really long journey'

Shift4 CEO Jared Isaacman joins Yahoo Finance’s Zack Guzman to discuss the company's public debut on the NYSE.

Video Transcript

ZACK GUZMAN: It's also quite the day for a new company to making its public debut. We're seeing that right now for payment processor Shift4, shares rising 49% after opening to trade here at the New York Stock Exchange. Shares there were priced above the initial range of offering at $23 a share yesterday. That was above the expected range of $19 to $21. And now, of course, we're seeing shares trade quite higher than that, $34.28.

For more on this, I want to bring on the CEO and founder of Shift4 Payments. Jared Isaacman joins us right now, here on the show. And Jared, first off, congratulations. I mean, this was a long road. You founded this company when you were 16 in your parents basement, back in 1999, now a publicly-traded company. Before we get into the actual business, why not just start by talking about the decision to go public right now, at a time like this?

JARED ISAACMAN: Yeah, sure. And you know, if I didn't have this mask on, you'd be seeing a pretty big smile on my face. To answer the question, you know, we've been on this journey to go public for 21 years, since we started the business. It was always our aspirations to be listed on the New York Stock Exchange. You know, my grandfather, who is the-- a lawyer and incorporated the company, you know, 21 years ago, he was a lifelong public equities trader. And he always told me, you know, the pinnacle for a business is to be listed on the New York Stock Exchange.

So it's been a really long journey. We were prepared all through 2019. We were actually scheduled to launch our original roadshow in March. And obviously, the COVID situation had to hit the pause button, you know, as we focused on taking care of our employees and ensuring continuity of services. But you know, we saw a recovery happening in the data. You know, Shift4, you know, processes payments for over 200,000 businesses. And in 2019, that was to $200 billion a year in volume.

We have tons of data. And we started to see the recovery, you know, really in late March and through April and then really accelerate in May. And that's what gave us the confidence to kind of reignite the IPO process and get it going. It's also why we weren't surprised today when we saw the jobs report because it certainly coincides with what we've been seeing in the numbers for the last few weeks.

ZACK GUZMAN: Yeah, let's talk more about those numbers that you have been seeing, though. Because even in your S-1, you highlighted the initial rebound there in terms of payment processing activity. What have you seen since that filing and how it's played now? Because obviously, you guys are levered to a lot of restaurants getting back to normal to actually process and charge customers like it was normal.

JARED ISAACMAN: Yeah, so I mean, we love the verticals we're in. We love restaurants. They've always proven to be resilient, you know, throughout our 21 year history, you know, even in the Great Recession, even post-dot-com, and it turns out, even during the darkest periods of the COVID pandemic. I mean, don't get me wrong. You know, there was a two week period of time there where, you know, there was really no commerce going on outside of supermarkets or Netflix or Amazon.

You know, but-- you know, these businesses-- and testament to the small business owners and restaurant owners, you know, to persevere through difficult times. You know, we tried to help with online ordering and takeout and delivery and technology tools that we have. But I don't want to take away from their spirit, which really got us going.

You know, during the darkest periods, payment volume dropped about 70% to 75% in late March. But right now, we're seeing a 120% recovery from that period. You know, that sure looks like a V recovery to us. There are several states around the country that have cities that have reached pre-COVID payment processing levels, which is just a really encouraging sign for everybody else as we move forward in this recovery.

ZACK GUZMAN: Yeah, and moving forward into recovery, I mean, how well positioned are you at Shift4 to kind of navigate the shift in technology that might be needed when we think about maybe contactless payments and the shift to maybe changing the way restaurants and other businesses, retail think about actually having that usual relationship with the customer?

JARED ISAACMAN: Well, you know, Shift4 was one of the winners going into the COVID crisis. I mean, we've been growing our end-to-end payment volume, you know, nearly 40% year over year for several quarters leading into the crisis. And that's pretty hard when you're a payments company for 21 years and have done payments the whole time. It really speaks to the strength of our value proposition, which is all about collapsing down, you know, unnecessary layers of expense and reducing the effective cost of service for our customers. Now, that's a value proposition that was very powerful, you know, going into the crisis. And again, it really rang true even during the darkest moments of the crisis.

We've had technology for contactless payments and QR-code-based payments and facilitating takeout and delivery orders, and we've been rolling that out for years. I mean, our first foray into QR code contactless payments was back in 2014. So the company is incredibly well positioned to help our customers during this road of recovery and adapt to whatever is that new normal.

ZACK GUZMAN: Wow, I've got to say, it's paying our dividends here on your debut in day one. As I said, shares up by about 50%. Maybe it was worthwhile, knowing that this recovery was underway with all the payment data you guys have. But appreciate it, and congratulations once again. Jared Isaacman, Shift4 Payments CEO, appreciate you taking the time.

JARED ISAACMAN: Thank you.