AvidXchange Holdings, Inc. (AVDX): Business Model Canvas [Dec-2025 Updated]

You're digging into AvidXchange Holdings, Inc.'s business model right now because the pending TPG/Corpay acquisition changes the game, and you need to know what you're actually buying into. Honestly, this isn't just about selling software; it's about running a massive payment utility, evidenced by them processing $21.5 billion in Q2 2025 volume while keeping a tight 73.3% non-GAAP gross margin in Q1 2025. We're mapping out the nine essential building blocks-from their deep ERP integrations to the float revenue they earn-that explain how this two-sided network creates sticky value for over 8,500 middle-market buyers. See below for the precise breakdown of their key activities and revenue streams.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Key Partnerships

You're looking at the structure of AvidXchange Holdings, Inc. after its transition to a private entity in late 2025. The Key Partnerships block is critical now, especially with the new ownership structure driving strategic alignment.

TPG and Corpay for the pending acquisition and future strategic alignment

The definitive agreement to be acquired by TPG in partnership with Corpay closed on October 15, 2025. AvidXchange Holdings, Inc. was valued at approximately $2.2 billion upon the transaction's completion. Corpay acquired a minority interest, investing approximately $550 million for a 34% equity stake in the company. Ron Clarke, Chairman and CEO of Corpay, stated the transaction is expected to be slightly accretive to the fourth quarter of 2025 earnings. TPG acquired a majority interest through TPG Capital. This partnership provides resources and a long-term vision to scale the platform.

ERP and Accounting Software providers (e.g., NetSuite, Sage, Microsoft) for deep integration

AvidXchange offers its Accounts Payable as a Service model directly to ERPs and accounting systems, enabling them to offer invoice and payment automation within their own platforms. The platform is built to integrate seamlessly into existing systems. As of the first quarter of 2025, AvidXchange's platform digitized AP workflows for more than 8,500 businesses. The network has processed payments to over 1,350,000 supplier customers over the five years preceding Q1 2025. The company lists integrations with platforms including NetSuite, Sage, and Microsoft, among others.

Here are some performance metrics associated with the platform that these partners utilize:

Banks and Financial Institutions for payment processing and treasury services

The platform relies on deep connections with Banks and Financial Institutions to facilitate the actual movement of funds for the automated payments AvidXchange processes. The total payment volume in Q2 2025 reached $21.5 billion, which flows through these financial channels.

Payment Networks (e.g., Visa, Mastercard) to facilitate digital payments

Digital payment facilitation, including card payments, is a core component of the value proposition delivered through these networks. The platform aims to convert more invoices to ePayments, with an internal metric showing over 40% ePayment conversion.

Consulting and Professional Service firms for customer referrals and implementation

These firms act as channels to bring middle market businesses onto the AvidXchange platform, often as part of broader financial system implementations or process overhauls. The company maintains a Partner Xchange Program offering incentives and rebates to partners.

Finance: draft the pro-forma balance sheet reflecting the $2.2 billion valuation by end of day Monday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Key Activities

You're looking at the core engine of AvidXchange Holdings, Inc. as of late 2025, focusing on what the company actually does day-to-day to generate revenue and maintain its market position. It's all about keeping the platform running, the payments flowing, and the network growing.

Developing and maintaining the cloud-based AP automation platform is foundational. This isn't a static piece of software; it requires constant upkeep and feature enhancement to serve its user base. As of the last reported figures, AvidXchange digitizes and automates AP workflows for more than 8,500 businesses. Also, the platform's operational health is reflected in its gross margin performance; the Non-GAAP gross profit margin hit 73.8% of total revenue in the second quarter of 2025, showing defintely strong unit economics on the services delivered.

The second major activity is managing and growing the two-sided buyer and supplier payment network. This network effect is what creates stickiness. Over the past five years, AvidXchange has securely processed payments to more than 1,350,000 supplier customers of its buyers. This scale is critical for network value.

The sheer scale of processing high-volume B2B payments is a key metric of success. Here's the quick math on the platform's throughput for the second quarter ended June 30, 2025:

What this estimate hides is the mix of payment types within that TPV, which directly impacts the yield. Still, the volume is the volume.

Next up is integrating new AI and machine learning features for fraud control and efficiency. AvidXchange launched new AI agents in April 2025, specifically an AI Approval Agent and an AI PO Matching Agent, to automate matching line-item details. This focus aligns with what finance leaders see as important; a survey of 500 mid-market finance leaders in August 2024 showed that 76% recognize the value of using AI to improve efficiency and decision-making. The platform uses AI-enhanced OCR and machine learning algorithms to extract invoice fields and auto-classify line items, which helps reduce fraud and enforce internal controls.

Finally, the ongoing work in sales and marketing to acquire new middle market buyer customers directly feeds the top of the funnel. This activity supports the base of over 8,500 businesses using the platform. The company's Q2 2025 revenue of $110.6 million, a 5.2% increase year-over-year, is the direct financial outcome of successfully selling and onboarding these customers onto the platform.

Finance: draft 13-week cash view by Friday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Key Resources

You're looking at the core assets AvidXchange Holdings, Inc. relies on to run its business as of mid-2025. These aren't just ideas; they're the hard numbers and established infrastructure that drive their value proposition.

The proprietary, two-sided AvidPay Network is central. This network connects the buyers using AvidXchange Holdings, Inc.'s platform with their suppliers. As of the first quarter of 2025, AvidXchange Holdings, Inc. reported making payments to more than 1,350,000 supplier customers of its buyers over the past five years. That's a massive reach for B2B payments. Also, the platform serves more than 8,500 businesses as buyers. If onboarding takes 14+ days, churn risk rises, so network density is key.

The SaaS-based AP automation platform and underlying technology infrastructure is the engine. This is the software-as-a-service offering that digitizes and automates accounts payable workflows. For context on the scale this infrastructure handles, in the first quarter of 2025, AvidXchange Holdings, Inc. processed 19.7 million transactions, representing a total payment volume (TPV) of $20.6 billion. The platform's efficiency is reflected in its profitability metrics; for Q1 2025, non-GAAP gross profit hit $79.1 million, yielding a non-GAAP gross margin of 73.3% of total revenue.

The company maintains significant financial capital to support operations and growth initiatives. As of the close of the first quarter of 2025, AvidXchange Holdings, Inc. sustained a strong balance sheet with cash and marketable securities totaling $389.3 million. This liquidity is important, especially given the pending acquisition by TPG in partnership with Corpay, which caused the company to suspend its previously issued financial outlook for fiscal 2025.

The operational scale and financial health underpinning these resources can be seen here:

The licensed money transmitter status for B2B payments in the US is a critical regulatory asset. This license allows AvidXchange Holdings, Inc. to legally move funds across state lines as part of its payment services, which is not something every fintech can claim. This regulatory compliance is a barrier to entry for competitors. Also, the platform offers flexibility in how suppliers receive funds:

• Virtual Mastercard
• AvidPay Direct (enhanced direct deposit)
• Paper check mailed via USPS

The platform's core value is tied up in its ability to process payments efficiently, which you can see in the transaction yield, which was $5.48 in Q1 2025. That small number, multiplied across billions in volume, is where the business model really works.

Finance: draft 13-week cash view by Friday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Value Propositions

You're looking at how AvidXchange Holdings, Inc. delivers concrete value to its middle market customers, and honestly, it boils down to taking the headache out of Accounts Payable (AP). The core proposition is end-to-end AP workflow digitization, which means you stop drowning in paper checks and manual data entry.

This digitization is supported by significant scale and activity as of the first quarter of 2025:

• Digitizes AP workflows for more than 8,500 businesses.
• Processed 19.7 million total transactions in Q1 2025.
• Facilitated payments to over 1,350,000 supplier customers over the last five years.

When you consider that security, including fraud and phishing attempts, was the number one concern for finance departments preparing for 2025, the value of a dedicated platform for fraud mitigation and enhanced security for B2B payments becomes clear. The platform acts as a control layer, moving away from less secure methods.

For you, the buyer, the platform delivers increased financial visibility and control over the procure-to-pay process. You can see where the money is going, which is critical for forecasting. Here's a look at the scale of activity driving that visibility:

Also, for your suppliers, you are offering faster, more predictable payment options. This network effect is key to adoption. The transaction yield, which reflects the value captured per payment, was $5.48 in Q1 2025, showing a slight increase of 0.2% from $5.47 in Q1 2024. That slight increase shows pricing power on the value delivered.

Finally, the operating efficiency underpinning this entire value delivery is reflected in the margin structure. The high non-GAAP gross margin of 73.3% reported in Q1 2025, up from 72.4% in Q1 2024, shows the inherent scalability of the software and payments model. By Q2 2025, that non-GAAP gross margin improved again to 73.8% of total revenue, with non-GAAP gross profit reaching $81.6 million.

Finance: draft the 13-week cash flow view by Friday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Customer Relationships

For buyer customers, AvidXchange Holdings, Inc. deploys dedicated account management and implementation teams to onboard and support its base of more than 8,500 businesses as of the first quarter of 2025.

The supplier side of the network relies on self-service portals, supporting a large network that has seen payments made to more than 1,350,000 supplier customers over the past five years, as reported in the first quarter of 2025.

The Software-as-a-Service (SaaS) model is designed to create sticky relationships, evidenced by the net transactions processed retention rate from 2023 to 2024 being 98.6%. This stickiness is crucial as the company continues to process significant volume, with total payment volume reaching $21.5 billion in the second quarter of 2025.

Continuous product innovation is directly informed by finance leader feedback, as seen in the 2025 Trends Survey results gathered in August 2024. This feedback loop helps shape the platform to address evolving needs, such as security concerns where more than three quarters of finance departments detected or fell victim to cyberattacks in the preceding year.

The digital-first support model is complemented by human assistance, necessary given the complexity of payments, especially as finance professionals take on new roles; 87% of survey respondents reported new responsibilities like data analytics and financial technology integration.

Here are key operational metrics reflecting the scale of these customer relationships as of mid-2025:

Feedback from finance leaders regarding technology adoption and priorities shows a clear direction for product focus:

• 76% of finance departments recognize the value of using AI for efficiency.
• 71% of finance leaders have concerns about measuring the ROI from AI initiatives.
• 76% of finance leaders view cloud-based technology as critical or favorable.
• Only 4% indicated that none of their finance work is conducted in cloud-based technologies.

The SaaS model's inherent high switching costs are supported by the platform's deep integration into buyer workflows, which is reflected in the transaction retention figures. The company expects to continue growing with its existing buyer base of over 8,500 businesses and plans to cross-sell additional solutions to them.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Channels

You're hiring before product-market fit, so knowing exactly how AvidXchange Holdings, Inc. reaches its customers is key to understanding their growth engine. Here's the breakdown of their Channels as of mid-2025, based on their latest reported figures.

Direct sales force targeting middle market businesses

AvidXchange Holdings, Inc. focuses its direct sales efforts on the middle market segment. This channel aims to bring both the buyer and their supplier network onto the proprietary two-sided network. As of May 2025 reporting, the platform served over 8,500 businesses, which are the primary targets of the direct sales force.

The scale of the network reached through these direct sales and subsequent supplier onboarding is substantial:

• Facilitated payments to more than 1.35 million supplier customers as of May 2025.
• Processed 20.1 million total transactions in the second quarter of 2025.
• Total Payment Volume (TPV) reached $21.5 billion in the second quarter of 2025.

Strategic channel partners (ERP vendors, banks) for co-selling and referrals

Strategic partnerships are a major component for scaling reach beyond the direct sales team. These partners help embed AvidXchange Holdings, Inc.'s solution directly into existing financial ecosystems. The company explicitly mentions leveraging its integration and strategic partnerships for growth.

A concrete example of this channel in action is the announced exclusive partnership with Ministry Brands around April 2025. The overall channel strategy is designed to drive volume through integrated workflows.

Online platform and API integrations for seamless customer onboarding

The software-as-a-service platform itself acts as a channel, particularly through its API integrations which allow for deep embedding within customer systems. This is critical for reducing friction in customer onboarding and driving transaction volume.

The success of the platform's utility is reflected in the transaction metrics:

• Total Payment Volume (TPV) grew 4.1% year-over-year to $21.5 billion in Q2 2025.
• Total transactions processed increased 1.8% year-over-year to 20.1 million in Q2 2025.

If onboarding takes 14+ days, churn risk rises. The API focus is defintely meant to combat that.

Digital marketing and content (webinars, guides) to generate leads

While specific digital marketing spend or lead volume is not public, the content strategy is clearly aimed at finance leaders who are actively seeking solutions. This content supports the direct sales motion and validates the platform's value proposition against current industry concerns.

Survey data from August 2024 highlights the environment AvidXchange Holdings, Inc.'s marketing addresses:

• 76% of finance leaders view cloud-based technology as critical or favorable to their operations.
• 87% of finance professionals reported new responsibilities like financial technology integration.

Industry-specific sales teams focusing on verticals like Real Estate and Construction

AvidXchange Holdings, Inc. tailors its approach by focusing on verticals where it has domain expertise. This specialization allows the sales teams to speak directly to industry-specific AP challenges, which is a key part of their value proposition to middle-market buyers.

The focus on specific verticals supports the overall transaction growth, even amid macro weakness. For instance, Q1 2025 revenue growth of 2.2% to $107.9 million was noted despite lower transaction volume due to macro weakness.

Finance: draft 13-week cash view by Friday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Customer Segments

You're looking at the core of AvidXchange Holdings, Inc.'s market focus-the companies and professionals who rely on their Accounts Payable (AP) automation platform. This segment is clearly defined by size, complexity of need, and industry focus.

The primary buyer segment consists of middle market businesses, specifically described as lower middle market companies, that have complex AP workflows needing digitization. As of the first quarter of 2025, AvidXchange Holdings, Inc. served more than 8,500 businesses as buyers.

The second major segment is the Suppliers (payees) who are onboarded onto the AvidPay Network when a buyer chooses to pay them through the platform. AvidXchange Holdings, Inc. reported making payments to more than 1,350,000 supplier customers of its buyers over the past five years, based on Q1 2025 data.

AvidXchange Holdings, Inc. targets specific industry verticals where AP complexity is often high. The company focuses on several key areas, including those mentioned in your outline, plus others:

• Real Estate
• Community Association Management (HOA)
• Construction
• Healthcare
• Financial Services
• Media
• Technology and Software

Finance leaders within these buyer organizations form a critical sub-segment, as their priorities drive technology adoption. A survey conducted in August 2024, looking ahead to 2025, polled 500 middle market finance leaders, revealing clear trends in their focus areas.

Here's a quick look at the quantitative data points defining these customer segments and their priorities:

Finance leaders are definitely focused on technology, but the ROI on newer tech like AI is still a sticking point. If onboarding takes 14+ days, churn risk rises, which is something AvidXchange Holdings, Inc. needs to manage in its service delivery to these segments.

The platform's ability to process transactions is also a key indicator of segment activity. For instance, in the second quarter of 2025, the company processed 20.1 million transactions, representing a total payment volume of $21.5 billion. In the first quarter of 2025, they processed 19.7 million transactions totaling $20.6 billion in payment volume.

Finance: draft 13-week cash view by Friday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Cost Structure

You're looking at the major costs AvidXchange Holdings, Inc. incurs to run its platform and acquire customers as of mid-2025. Honestly, the biggest drivers are personnel, sales efforts, and the direct costs of processing payments.

The Cost Structure is heavily weighted toward operating expenses, which totaled $92.0 million in the second quarter of 2025, up from $76.8 million in the previous year. This increase is primarily due to higher sales, marketing, and administrative spending.

Here's a breakdown of the key cost components based on the second quarter of 2025 GAAP figures:

Technology and development costs, which cover engineering for the platform, show up in the Research and Development line. For Q2 2025, this was $27.0 million on a GAAP basis. While the prompt asks about AI and cloud infrastructure specifically, the reported figure is the aggregate R&D spend, which increased 8% year-over-year.

Cost of revenue directly relates to payment processing and the infrastructure supporting transactions. The GAAP gross profit margin for Q2 2025 stood at 66.6% of total revenue, which means the Cost of Revenue was approximately $37.0 million ($110.6 million total revenue minus $73.6 million GAAP gross profit). The Non-GAAP gross profit margin was 73.8%.

Sales and marketing expenses are a significant outlay to drive customer acquisition. In Q2 2025, these expenses hit $23.1 million (GAAP), representing a 15% jump from the prior year's second quarter. This spend fuels the growth engine.

General and administrative expenses (G&A) were $33.5 million in Q2 2025. A notable, non-recurring component within this was the $6.4 million in transaction and deal costs tied to the merger announcement. This single item significantly impacted the bottom line, contributing to the GAAP net loss of $(9.5) million for the quarter.

Personnel costs are embedded across the operating expenses. We see the engineering component in R&D at $27.0 million and the sales team component in Sales and Marketing at $23.1 million for Q2 2025 (GAAP). Support team costs are likely included within G&A, but a specific personnel breakout isn't explicitly provided in the latest figures.

You should track the non-GAAP gross margin improvement, which was 73.8% in Q2 2025, up from 72.6% in Q2 2024. Finance: draft 13-week cash view by Friday.

AvidXchange Holdings, Inc. (AVDX) - Canvas Business Model: Revenue Streams

You're looking at how AvidXchange Holdings, Inc. brings in the money based on their late 2025 financials. The revenue mix is heavily weighted toward transaction volume, but the float revenue is also a meaningful component.

The primary drivers for AvidXchange Holdings, Inc.'s revenue streams are directly tied to the volume and frequency of payments processed through their Accounts Payable (AP) automation platform. Here's a breakdown of the key components based on the second quarter of 2025 results.

The total revenue for AvidXchange Holdings, Inc. in the second quarter of 2025 reached $110.6 million. This figure is built from several distinct sources, which you can see mapped out below.

The core revenue generation is transactional, but the company also captures revenue from the platform itself and the management of funds during the payment float.

Here's a look at the quantified revenue components for Q2 2025:

The transaction yield, which is the average revenue generated per transaction, was $5.50 for the second quarter of 2025. This metric saw a 3.2% increase from the prior year period. The total number of transactions processed hit 20.1 million in that same quarter.

The interest income, often called float revenue, which comes from funds held during the payment cycle, was reported at $10.6 million for Q2 2025. This was slightly down from $11.8 million in Q2 2024, but still a significant part of the top line.

The revenue streams AvidXchange Holdings, Inc. relies on include:

• Transaction fees from processing payments.
• Subscription fees (SaaS) for the AP automation software platform.
• Interest income (float revenue) from funds held.
• Revenue from value-added services like Straight Through Processing.

To be fair, while we know the total revenue and the interest income, the exact split between transaction fees and subscription fees isn't explicitly broken out in the headline metrics, but the transaction volume and yield give you a very clear picture of the transactional engine. Finance: draft 13-week cash view by Friday.