Alkami Technology, Inc. (NASDAQ: ALKT)

Alkami Technology, Inc., often recognized by its ticker symbol ALKT, operates in the financial technology sector, providing cloud-based digital banking solutions. The company's primary business activity involves offering a digital banking platform designed to empower community, regional, and super-regional financial institutions (FIs) in the United States. This platform enables FIs to onboard and engage new users, accelerate revenues, and enhance operational efficiency.

Alkami generates revenue through multi-year contracts for its digital banking platform. The contract life typically lasts for approximately 70 months, and the company employs a per-registered-user pricing model. This model includes incremental fees above certain contractual client minimum commitments for each licensed solution. The pricing is tiered, offering per-registered-user discounts as clients achieve higher levels of customer penetration, thereby encouraging clients to promote digital engagement internally.

The company's digital banking platform provides an end-to-end set of digital banking software products, including digital account opening, card experience, customer service, extensibility, financial wellness, security and fraud protection, marketing, and analytics, and money movement. As of December 31, 2023, the company's client base, on average, utilized 13 of the 33 offered products.

Alkami's digital banking platform is a multi-tenant, single code base, continuous delivery platform powered by a true cloud infrastructure. It integrates with core system providers and other third-party fintech providers, acting as the primary interaction point among consumers, businesses, and FIs. The platform maintains over 300 integrations to more than 1,000 endpoints.

The company's value proposition is characterized by a premier user experience, versatility, velocity of innovation, and fraud mitigation. The platform delivers tangible results to clients, including increased registered user growth, increased product usage, operational efficiencies, and customer retention.

Alkami aims to grow its business and expand its addressable market by deepening existing client relationships, cross-selling, customer penetration, winning new clients, broadening and enhancing its product suite, and selectively pursuing acquisitions.

The digital banking platform offers 10 product categories, encompassing 33 products and more than 300 integrations. These categories include digital account opening, marketing, data insights, card experience, money movement, customer service, commercial banking, financial wellness, security and fraud protection, and extensibility.

Alkami's technology is predominantly differentiated by the speed-to-market with which it can deliver innovation on the back of a true cloud infrastructure with a multi-tenant architecture and single code base. The company's security infrastructure combines security and services from AWS with its own security protocols and integrations.

ALKAMI serves over 650 clients, including community, regional, and super-regional credit unions and banks across both retail and business banking. The company's target client base includes the top 2,500 FIs by assets, excluding megabanks.

The competition in the digital banking solutions market is intense, with many established and new companies offering similar solutions. Alkami distinguishes itself through its comprehensive integration among its solution offerings, its clients' internal and third-party systems, deep industry expertise, reputation for consistent, high-quality client support, pace at which it brings innovation to market, and unified cloud-based digital banking and SaaS solutions.