0001728688-20-000086 | 10-K | XBRL Viewer

$ 150,134

$ 376,307

$ 323,508

242,867

^[1]

214,543

^[1]

47,230

44,237

40,314

78,323

62,860

40,585

18,217

16,564

11,839

(1,409)

3,389

3,866

Total operating expenses

142,361

369,917

311,147

Change in fair value of warrant liability

7,773

6,390

12,361

Other expenses

Interest expense, net

8,926

6,004

8,498

8,487

Other expense

2,621

Total other expenses

11,547

6,004

16,985

(Loss) income before income taxes

(3,774)

386

(4,624)

(Benefit from) provision for income taxes

(2,795)

(177)

337

Net (loss) income

(979)

563

(4,961)

Net (loss) income attributable to non-controlling interest

(560)

3,608

1,937

Net loss attributable to i3 Verticals, Inc.

$ (419)

$ (3,045)

$ (6,898)

Net (loss) income per share attributable to Class A common stockholders

Basic (in USD per share)

^[2]

$ (0.03)

$ (0.29)

$ 0.08

Diluted (in USD per share)

^[2]

$ (0.03)

$ (0.29)

$ 0.08

Weighted average shares of Class A common stock outstanding

Basic (shares)

^[1]

14,833,378

10,490,981

8,812,630

Diluted (shares)

^[1]

27,429,801

10,490,981

26,873,878

[1]	Effective October 1, 2019, the Company's revenues are presented net of interchange and network fees in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers. See Note 2 to our consolidated financial statements for a description of the recently adopted accounting pronouncement.
[2]	Basic and diluted net income per share of Class A common stock are presented only for the period after the Company’s Reorganization Transactions. See Note 1 for a description of the Reorganization Transactions. See Note 18 for the calculation of income per common share.

Consolidated Statement of Changes in Equity - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Class A	Class B	Class P	Common Stock	Common Stock Class A	Common Stock Class B	Additional Paid-In Capital	Accumulated Members' Deficit/Retained Earnings	Accumulated Members' Deficit/Retained Earnings Cumulative Effect, Period of Adoption, Adjustment	Non-Controlling Interest	Non-Controlling Interest Cumulative Effect, Period of Adoption, Adjustment
Members' Equity, beginning at Sep. 30, 2017	$ 3,146				$ 0	$ 1,240	$ 34,924			$ (33,018)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Preferred return on Class A Units and Redeemable Class A Units			$ (2,522)
Purchase of common units in i3 Verticals, LLC from selling unitholder	0
Members' Equity, ending at Sep. 30, 2018					$ 0	$ 0	$ 0			0
Common Stock, Shares, Outstanding, beginning (in shares) at Sep. 30, 2017							0	0
Stockholders' Equity, beginning at Sep. 30, 2017							$ 0	$ 0	$ 0	0		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Distributions to non-controlling interest holders	0
Net (loss) income	(6,898)		736
Net (loss) income attributable to non-controlling interests	(1,937)		(1,937)
Net loss (income)	(4,961)		2,673
Common Stock, Shares, Outstanding, ending (in shares) at Sep. 30, 2018							9,112,042	17,213,806
Stockholders' Equity, ending at Sep. 30, 2018	112,198						$ 1	$ 2	38,562	736		72,897
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Preferred return on Class A Units and Redeemable Class A Units			0
Issuance of common stock	21,660								21,660
Issuance of class A common stock (shares)							1,000,000
Purchase of common units in i3 Verticals, LLC from selling unitholder	(12,077)
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis	3,959								3,959
Equity based compensation recognized	6,124								6,124
Forfeitures of restricted Class A common stock (shares)							(36,113)
Forfeitures of restricted Class A common stock	0
Distributions to non-controlling interest holders	(2,060)											(2,060)
Redemption of common units in i3 Verticals, LLC (shares)							4,292,169	(4,292,169)
Redemption of common units in i3 Verticals, LLC	(1)							$ (1)	12,077			(12,077)
Capitalization of public offering costs	(899)								(899)
Issuance of restricted Class A common stock under Equity Plan (shares)							8,799
Issuance of restricted Class A common stock under Equity Plan	225								225
Exercise of equity-based awards (shares)							67,218
Exercise of equity-based awards	672								672
Net (loss) income	(3,045)		(3,045)							(3,045)
Net (loss) income attributable to non-controlling interests	(3,608)		(3,608)									3,608
Net loss (income)	563		$ 563
Common Stock, Shares, Outstanding, ending (in shares) at Sep. 30, 2019			14,444,115	12,921,637			14,444,115	12,921,637
Stockholders' Equity, ending at Sep. 30, 2019	142,441	$ 1,345					$ 1	$ 1	82,380	(2,309)	$ 705	62,368	$ 640
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Preferred return on Class A Units and Redeemable Class A Units			$ 0
Issuance of common stock	72,557						$ 1		72,556
Issuance of class A common stock (shares)							3,250,000
Purchase of common units in i3 Verticals, LLC from selling unitholder	(5,080)
Deferred tax asset adjustment	(941)								(941)
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis	896								896
Equity based compensation recognized	10,452								10,452
Adjustment related to prior periods	0								(2,730)			2,730
Distributions to non-controlling interest holders	(3)											(3)
Redemption of common units in i3 Verticals, LLC (shares)							1,021,016	(1,021,016)
Redemption of common units in i3 Verticals, LLC	0								5,080			(5,080)
Capitalization of public offering costs	$ (697)								(697)
Exercise of equity-based awards (shares)	331,141						149,012
Exercise of equity-based awards	$ 254								254
Allocation of equity to non-controlling interests	0								(24,495)			24,495
Equity component of exchangeable notes, net of issuance costs and deferred taxes	27,578								27,578
Purchases of exchangeable note hedges	(28,676)								(28,676)
Issuance of warrants	14,669								14,669
Repurchases of exchangeable notes	1,272								1,272
Net (loss) income	(419)		(419)							(419)
Net (loss) income attributable to non-controlling interests	560		560									(560)
Net loss (income)	(979)		$ (979)
Common Stock, Shares, Outstanding, ending (in shares) at Sep. 30, 2020			18,864,143	11,900,621			18,864,143	11,900,621
Stockholders' Equity, ending at Sep. 30, 2020	$ 240,168						$ 2	$ 1	$ 157,598	$ (2,023)		$ 84,590

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities:
Net (loss) income	$ (979)	$ 563	$ (4,961)
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	18,217	16,564	11,839
Equity-based compensation	10,452	6,124	1,567
Provision for doubtful accounts	177	30	14
Amortization of debt discount and issuance costs	3,703	721	1,072
Debt issuance cost write offs	141	152	0
Loss on repurchase of exchangeable notes	2,297	0	0
Amortization of capitalized client acquisition costs	398	0	0
Loss on disposal of assets	1	8	5
Benefit from deferred income taxes	(3,207)	(586)	(682)
Non-cash change in fair value of warrant liability	0	0	8,487
(Decrease) increase in non-cash contingent consideration expense from original estimate	(1,409)	3,389	3,866
Changes in operating assets:
Accounts receivable	(1,028)	2,430	(2,321)
Prepaid expenses and other current assets	(984)	(817)	1,017
Other assets	(1,544)	(2,769)	(3,182)
Changes in operating liabilities:
Accounts payable	239	(1,768)	1,172
Accrued expenses and other current liabilities	1,575	1,572	2,040
Deferred revenue	617	2,588	(123)
Other long-term liabilities	93	(44)	362
Contingent consideration paid in excess of original estimates	(5,039)	(1,560)	(2,092)
Net cash provided by operating activities	23,720	26,597	18,080
Cash flows from investing activities:
Expenditures for property and equipment	(2,911)	(807)	(2,217)
Expenditures for capitalized software	(2,893)	(2,227)	(1,092)
Purchases of merchant portfolios and residual buyouts	(1,788)	(3,586)	(1,207)
Acquisitions of businesses, net of cash acquired	(27,689)	(137,036)	(32,362)
Acquisition of other intangibles	(150)	(72)	(1,177)
Net cash used in investing activities	(35,431)	(143,728)	(38,055)
Cash flows from financing activities:
Proceeds from revolving credit facility	172,123	188,491	27,250
Payments of revolving credit facility	(313,267)	(51,867)	(95,600)
Proceeds from borrowings on exchangeable notes	138,000	0	0
Payments for purchase of exchangeable senior note hedges	(28,676)	0	0
Proceeds from issuance of warrants	14,669	0	0
Payments for repurchase of exchangeable notes	(17,414)	0	0
Proceeds from notes payable to banks	0	0	24,671
Payments of notes payable to banks	0	(35,000)	(5,000)
Payment of notes payable to Mezzanine Lenders	0	0	(10,486)
Payment of unsecured notes payable to related and unrelated creditors	0	0	(5,489)
Payments of debt issuance costs	(5,300)	(168)	(266)
Proceeds from the exercise of Mezzanine Warrants and Junior Subordinated Notes Warrants	0	0	270
Proceeds from issuance of Class A common	82,901	111,687	0
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and offering costs	0	0	89,506
Payments for Common Units in i3 Verticals, LLC from selling unitholders	(10,883)	(90,027)	(4,635)
Cash paid for contingent consideration	(3,492)	(2,634)	(977)
Payments for required distributions to members for tax obligations	(3)	(2,060)	0
Proceeds from stock option exercises	764	672	0
Payments for employee's tax withholdings from net settled stock option exercises	(310)	0	0
Net cash provided by financing activities	29,112	119,094	19,244
Net increase (decrease) in cash, cash equivalents, and restricted cash	17,401	1,963	(731)
Cash, cash equivalents, and restricted cash at beginning of period	3,200	1,237	1,968
Cash, cash equivalents, and restricted cash at end of period	20,601	3,200	1,237
Supplemental disclosure of cash flow information:
Cash paid for interest	5,250	4,911	7,881
Cash paid for income taxes	$ 792	$ 1,420	$ 483

Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017
Statement of Cash Flows [Abstract]
Cash and cash equivalents	$ 15,568	$ 1,119	$ 572	$ 955
Restricted cash	5,033	2,081	665	1,013
Total cash, cash equivalents, and restricted cash	$ 20,601	$ 3,200	$ 1,237	$ 1,968

Organization and Operations	12 Months Ended
Organization and Operations	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Operations	ORGANIZATION AND OPERATIONS i3 Verticals, Inc. (the “Company”) was formed as a Delaware corporation on January 17, 2018. The Company was formed for the purpose of completing an initial public offering (“IPO”) of its Class A common stock and other related transactions in order to carry on the business of i3 Verticals, LLC and its subsidiaries. i3 Verticals, LLC was founded in 2012 and delivers seamlessly integrated payment and software solutions to small- and medium-sized businesses (“SMBs”) and organizations in strategic vertical markets. The Company’s headquarters are in Nashville, Tennessee, with operations throughout the United States. Unless the context otherwise requires, references to “we,” “us,” “our,” “i3 Verticals” and the “Company” refer to i3 Verticals, Inc. and its subsidiaries, including i3 Verticals, LLC. Initial Public Offering On June 25, 2018, the Company completed the IPO of 7,647,500 shares of its Class A common stock at a public offering price of $13.00 per share. The Company received approximately $92.5 million of net proceeds, after deducting underwriting discounts and commissions, which the Company used to purchase newly issued common units from i3 Verticals, LLC (the “Common Units”), and Common Units from a selling Common Unit holder, in each case at a price per Common Unit equal to the price per share paid by the underwriters for shares of the Company's Class A common stock in the IPO. Reorganization Transactions In connection with the IPO, the Company completed the following transactions (the “Reorganization Transactions”): •i3 Verticals, LLC amended and restated its existing limited liability company agreement to, among other things, (1) convert all existing Class A units, common units (including common units issued upon the exercise of existing warrants) and Class P units of ownership interest in i3 Verticals, LLC into either Class A voting common units of i3 Verticals, LLC (such holders of Class A voting common units referred to herein as the “Continuing Equity Owners”) or Class B non-voting common units of i3 Verticals, LLC (such holders of Class B non-voting common units referred to herein as the “Former Equity Owners”), and (2) appoint i3 Verticals, Inc. as the sole managing member of i3 Verticals, LLC upon its acquisition of Common Units in connection with the IPO; •the Company amended and restated its certificate of incorporation to provide for, among other things, Class A common stock and Class B common stock; •i3 Verticals, LLC and the Company consummated a merger among i3 Verticals, LLC, i3 Verticals, Inc. and a newly formed wholly-owned subsidiary of i3 Verticals, Inc. (“MergerSub”) whereby: (1) MergerSub merged with and into i3 Verticals, LLC, with i3 Verticals, LLC as the surviving entity; (2) Class A voting common units converted into newly issued Common Units in i3 Verticals, LLC together with an equal number of shares of Class B common stock of i3 Verticals, Inc., and (3) Class B non-voting common units converted into Class A common stock of i3 Verticals, Inc. based on a conversion ratio that provided an equitable adjustment to reflect the full value of the Class B non-voting common units; and •the Company issued shares of its Class A common stock pursuant to a voluntary private conversion of certain subordinated notes (the “Junior Subordinated Notes”) by certain related and unrelated creditors of i3 Verticals, LLC. Following the completion of the IPO and Reorganization Transactions, the Company became a holding company and its principal asset is the Common Units in i3 Verticals, LLC that it owns. i3 Verticals, Inc. operates and controls all of i3 Verticals, LLC's operations and, through i3 Verticals, LLC and its subsidiaries, conducts i3 Verticals, LLC's business. i3 Verticals, Inc. has a majority economic interest in i3 Verticals, LLC. Public Offerings On June 10, 2019, the Company completed a secondary public offering (the “June 2019 Secondary Public Offering”) of 5,165,527 shares of its Class A common stock, at a public offering price of $22.75 per share, which included a full exercise of the underwriters' option to purchase 673,764 additional shares of Class A Common Stock from the Company. The Company received approximately $111,640 of net proceeds, after deducting underwriting discounts and commissions, but before offering expenses. The Company used the net proceeds to purchase (1) 1,000,000 Common Units directly from i3 Verticals, LLC, and (2) 4,165,527 Common Units (including 673,764 Common Units due to the exercise of the underwriters' option to purchase additional shares in full) and an equivalent number of Class B common stock (which shares were then canceled) from certain Continuing Equity Owners, in each case at a price per Common Unit equal to the price per share paid by the underwriters for shares of the Company's Class A common stock in the offering. i3 Verticals, LLC received $20,870 in net proceeds from the sale of Common Units to the Company, which it used to repay outstanding indebtedness. On September 15, 2020, the Company completed a primary public offering (the “September 2020 Public Offering”) of 3,737,500 shares of its Class A common stock, at a public offering price of $23.50 per share, which included a full exercise of the underwriters' option to purchase 487,500 additional shares of Class A Common Stock from the Company. The Company received approximately $83,400 of net proceeds, after deducting underwriting discounts and commissions, but before offering expenses. The Company used the net proceeds to purchase (1) 3,250,000 Common Units directly from i3 Verticals, LLC, and (2) 487,500 Common Units pursuant to the exercise of the underwriters' option to purchase additional shares in full and an equivalent number of Class B common stock (which shares were then canceled) from certain Continuing Equity Owners, in each case at a price per Common Unit equal to the price per share paid by the underwriters for shares of the Company's Class A common stock in the offering. i3 Verticals, LLC received $72,018 in net proceeds from the sale of Common Units to the Company, which it used to repay outstanding indebtedness. i3 Verticals, Inc. is the sole managing member of i3 Verticals, LLC and as a result, consolidates the financial results of i3 Verticals, LLC and reports a non-controlling interest representing the Common Units of i3 Verticals, LLC held by the Continuing Equity Owners. As the Reorganization Transactions are considered transactions between entities under common control, the financial statements retroactively reflect the accounts of i3 Verticals, LLC for periods prior to the IPO and Reorganization Transactions. The Continuing Equity Owners who own Common Units in i3 Verticals, LLC may redeem at each of their options (subject in certain circumstances to time-based vesting requirements) their Common Units for, at the election of i3 Verticals, LLC, cash or newly-issued shares of the Company's Class A common stock. As of September 30, 2020, i3 Verticals, Inc. owned 61.3% of the economic interest in i3 Verticals, LLC. As of September 30, 2020, the Continuing Equity Owners owned Common Units in i3 Verticals, LLC representing approximately 38.7% of the economic interest in i3 Verticals, LLC, shares of Class A common stock in the Company representing approximately 0.5% of the economic interest and voting power in the Company, and shares of Class B common stock in i3 Verticals, Inc., representing approximately 38.7% of the voting power in the Company. Combining the Class A common stock and Class B common stock, the Continuing Equity Holders hold approximately 39.2% of the economic interest and voting power in i3 Verticals, Inc.

Summary of Significant Accounting Policies

12 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the reporting and disclosure rules and regulations of the Securities and Exchange Commission (“SEC”).

Principles of Consolidation

These consolidated financial statements include the accounts of the Company and its subsidiary companies. All significant intercompany accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

For purposes of reporting cash flows, the Company considers cash on hand, checking accounts, and savings accounts to be cash and cash equivalents. At times, the balance in these accounts may exceed federal insured limits. Cash equivalents are defined as financial instruments readily transferrable into cash with an original maturity less than 90 days.

Restricted Cash

Restricted cash represents funds held-on-deposit with processing banks pursuant to agreements to cover potential merchant losses. It is presented as long-term assets on the accompanying consolidated balance sheets since the related agreements extend beyond the next twelve months. Following the adoption of Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows: Restricted Cash (Topic 230), the Company includes restricted cash along with the cash and cash equivalents balance for presentation in the consolidated statements of cash flows.

Accounts Receivable and Credit Policies

Accounts receivable consist primarily of uncollateralized credit card processing residual payments due from processing banks requiring payment within thirty days following the end of each month. Accounts receivable also include amounts due from the sales of the Company’s technology solutions to its customers. The carrying amount of accounts receivable is reduced by an allowance for doubtful accounts, if necessary, which reflects management’s best estimate of the amounts that will not be collected. The allowance is estimated based on management’s knowledge of its customers, historical loss experience and existing economic conditions. Accounts receivable and the allowance are written-off when, in management’s opinion, all collection efforts have been exhausted. The Company’s allowance for doubtful accounts was $310 and $232 as of September 30, 2020 and 2019, respectively; however, actual write-offs may exceed estimated amounts.

Inventories

Inventories consist of point-of-sale equipment to be sold to customers and are stated at the lower of cost, determined on a weighted average basis, or net realizable value. Inventories were $1,309 and $1,294 at September 30, 2020 and 2019, respectively, and are included within prepaid expenses and other current assets on the accompanying consolidated balance sheets.

Property and Equipment

Property and equipment are stated at cost or, if acquired through a business combination or an asset acquisition, fair value at the date of acquisition. Depreciation and amortization are provided over the assets’ estimated useful lives (or, if obtained in connection with a business acquisition, over their estimated remaining useful lives) using the straight-line method, except for leasehold improvements, which are depreciated over the shorter of the estimated useful lives of the assets or the lease term.

Expenditures for maintenance and repairs are expensed when incurred. Expenditures for renewals or betterments are capitalized. Management reviews long-lived assets for impairment when events or changes in

circumstances indicate the carrying amount of an asset may not be recoverable. The Company recognizes impairment when the sum of undiscounted estimated future cash flows expected to result from the use of the asset is less than the carrying value of the asset. There were no impairment charges during the years ended September 30, 2020, 2019 and 2018.

Capitalized Software

Development costs for software to be sold or leased to customers are capitalized once technological feasibility of the software product has been established. Costs incurred prior to establishing technological feasibility are expensed as incurred. Technological feasibility is established when the Company has completed a detailed program design and has determined that a product can be produced to meet its design specifications, including functions, features and technical performance requirements. Capitalization of costs ceases when the product is generally available to clients. Software development costs are amortized using the greater of the straight-line method or the usage method over its estimated useful life, which is generally estimated to be three years.

Software development costs may become impaired in situations where development efforts are abandoned due to the viability of a planned project becoming doubtful or due to technological obsolescence of a planned software product. Management evaluates the remaining useful lives and carrying values of capitalized software at least annually or when events and circumstances warrant such a review, to determine whether significant events or changes in circumstances indicate that impairment in value may have occurred. To the extent estimated net realizable values, which are estimated to equal future undiscounted cash flows, exceed the carrying value, no impairment is necessary. If estimated net realizable values are less than the carrying values, an impairment charge is recorded. Impairment charges during the years ended September 30, 2020, 2019 and 2018 were nominal.

Identifiable software technology intangible assets resulting from acquisitions are amortized using the straight-line method over periods not exceeding their remaining estimated useful lives. GAAP requires that intangible assets with estimated useful lives be amortized over their respective estimated useful lives to their residual values, and reviewed for impairment. Acquisition technology intangibles’ net book values are included in capitalized software, net in the accompanying consolidated balance sheets.

Notes Receivable

Notes receivable consist of loans made to unrelated entities. Notes receivable were $1,195 and $195 at September 30, 2020 and 2019, respectively, and are included within other assets on the accompanying consolidated balance sheets.

Acquisitions

Business acquisitions have been recorded using the acquisition method of accounting in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations (“ASC 805”), and, accordingly, the purchase price has been allocated to the assets acquired and liabilities assumed based on their estimated fair value as of the date of acquisition. Where relevant, the fair value of material contingent consideration included in an acquisition is calculated using a Monte Carlo simulation. The fair value of merchant relationships and non-compete assets acquired is identified using the Income Approach. The fair value of trade names acquired is identified using the Relief from Royalty Method. The fair value of deferred revenue is identified using the Adjusted Fulfillment Cost Method. After the purchase price has been allocated, goodwill is recorded to the extent the total consideration paid for the acquisition, including the acquisition date fair value of contingent consideration, if any, exceeds the sum of the fair values of the separately identifiable acquired assets and assumed liabilities. Acquisition costs for business combinations are expensed when incurred and recorded in selling general and administrative expenses in the accompanying consolidated statements of operations.

Acquisitions not meeting the accounting criteria to be accounted for as a business combination are accounted for as an asset acquisition. An asset acquisition is recorded at its purchase price, inclusive of acquisition costs, which is allocated among the acquired assets and assumed liabilities based upon their relative fair values at the date of acquisition.

The operating results of an acquisition are included in the consolidated statements of operations from the date of such acquisition. Acquisitions completed during the year ended September 30, 2020 contributed $1,275 and $327 of revenue and net income, respectively, to the results in the Company's consolidated statements of operations for the year then ended.

Goodwill

In accordance with ASC 350, Intangibles—Goodwill and Other, the Company tests goodwill for impairment for each reporting unit on an annual basis in the fourth quarter, or when events or circumstances indicate the fair value of a reporting unit is below its carrying value.

The Company’s goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in business combinations. The goodwill generated from the business combinations is primarily related to the value placed on the employee workforce and expected synergies. Judgment is involved in determining if an indicator or change in circumstances relating to impairment has occurred. Such changes may include, among others, a significant decline in expected future cash flows, a significant adverse change in the business climate, and unforeseen competition. No goodwill impairment charges were recognized during the years ended September 30, 2020, 2019 and 2018.

The Company has the option of performing a qualitative assessment of impairment to determine whether any further quantitative testing for impairment is necessary. The option of whether or not to perform a qualitative assessment is made annually and may vary by reporting unit. Factors the Company considers in the qualitative assessment include general macroeconomic conditions, industry and market conditions, cost factors, overall financial performance of the Company’s reporting units, events or changes affecting the composition or carrying amount of the net assets of its reporting units, sustained decrease in its share price, and other relevant entity specific events. If the Company determines not to perform the qualitative assessment or if it determines, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not less than the carrying value, then the Company performs a quantitative test for that reporting unit. The fair value of each reporting unit is compared to the reporting unit’s carrying value, including goodwill. Subsequent to the adoption on January 1, 2017 of Accounting Standards Update (“ASU”) No. 2017-04, Intangibles—Goodwill and Other: Simplifying the Test for Goodwill Impairment, if the fair value of a reporting unit is less than its carrying value, the Company recognizes an impairment equal to the excess carrying value, not to exceed the total amount of goodwill allocated to that reporting unit.

For a discussion of the estimation methodology, the qualitative factors considered when performing a qualitative assessment and the significance of various inputs, please see the subheading below titled “Use of Estimates.”

The Company has determined that it has five reporting units as of the date of the most recent annual good impairment test. For each of the years ended September 30, 2020, 2019 and 2018 the Company performed a quantitative assessment for each of its reporting units. The Company determined that none of the reporting units were impaired.

Intangible Assets

Intangible assets include acquired merchant relationships, residual buyouts, referral agreements, trademarks, tradenames, website development costs and non-compete agreements. Merchant relationships represent the fair value of customer relationships purchased by the Company. Residual buyouts represent the right to not have to pay a residual to an independent sales agent related to certain future transactions with the agent’s referred

merchants. Referral agreements represent the right to exclusively obtain referrals from a partner for their customers' credit card processing services.

The Company amortizes definite lived identifiable intangible assets using a method that reflects the pattern in which the economic benefits of the intangible asset are expected to be consumed or otherwise utilized. The estimated useful lives of the Company’s customer-related intangible assets approximate the expected distribution of cash flows, whether straight-line or accelerated, generated from each asset. The useful lives of contract-based intangible assets are equal to the terms of the agreement.

During the first quarter of fiscal year 2019, management determined it was appropriate to change the amortization rate of our merchant contract intangible assets to reflect the expected distribution of future cash flows. This change was applied prospectively beginning on October 1, 2018 and resulted in $1,290 in additional amortization expense recorded in the year ended September 30, 2019.

Management evaluates the remaining useful lives and carrying values of long-lived assets, including definite lived intangible assets, at least annually, or when events and circumstances warrant such a review, to determine whether significant events or changes in circumstances indicate that a change in the useful life or impairment in value may have occurred. There were no impairment charges during the years ended September 30, 2020, 2019 and 2018.

Income Taxes

i3 Verticals, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from i3 Verticals, LLC based on i3 Verticals, Inc.'s economic interest in i3 Verticals, LLC. i3 Verticals, LLC's members, including the Company, are liable for federal, state and local income taxes based on their share of i3 Verticals, LLC's pass-through taxable income. i3 Verticals, LLC is not a taxable entity for federal income tax purposes, but is subject to and reports entity level tax in both Tennessee and Texas. In addition, certain subsidiaries of i3 Verticals, LLC are corporations that are subject to state and federal income taxes.

The amount provided for state income taxes is based upon the amounts of current and deferred taxes payable or refundable at the date of the consolidated financial statements as a result of all events recognized in the financial statements as measured by the provisions of enacted tax laws.

Under GAAP, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The Company reports a liability for unrecognized tax positions taken or expected to be taken in a tax return. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits as part of income tax expense. See additional discussion in Note 10.

Valuation of Contingent Consideration

On occasion, the Company may have acquisitions which include contingent consideration. Accounting for business combinations requires the Company to estimate the fair value of any contingent purchase consideration at the acquisition date. For a discussion of the estimate methodology and the significance of various inputs, please see the subheading below titled “Use of Estimates.” Changes in estimates regarding the fair value contingent purchase consideration are reflected as adjustments to the related liability and recognized within operating expenses in the consolidated statements of operations. Short and long-term contingent liabilities are presented within accrued expenses and other current liabilities and other long-term liabilities on the Company's consolidated balance sheets, respectively.

Classification of Financial Instruments

The Company classifies certain financial instruments issued as either equity or as liabilities. Determination of classification is based upon the underlying properties of the instrument. See specific discussion regarding the nature of instruments issued, the presentation on the consolidated financial statements and the related valuation method applied in Notes 9, 11, 12, and 13.

Revenue Recognition and Deferred Revenue

For the year ended September 30, 2020, revenue is recognized as each performance obligation is satisfied, in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). The Company accrues for rights of refund, processing errors or penalties, or other related allowances based on historical experience. The Company utilized the portfolio approach practical expedient within ASC 606-10-10-4 Revenue from Contracts with Customers—Objectives and the significant financing component practical expedient within ASC 606-10-32-18 Revenue from Contracts with Customers—The Existence of a Significant Financing Component in the Contract in performing the analysis. The Company adopted ASC 606 on October 1, 2019, using the modified retrospective method and applying the standard to all contracts not completed on the date of adoption. Results for the reporting period beginning October 1, 2019 are presented under ASC 606, while prior period amounts continue to be reported in accordance with the Company's historic accounting practices under previous guidance.

The majority of the Company's revenue for the years ended September 30, 2020, 2019 and 2018 is derived from volume-based payment processing fees (“discount fees”) and other related fixed transaction or service fees. The remainder is comprised of sales of software licensing subscriptions, ongoing support, and other POS-related solutions the Company provides to its clients directly and through its processing bank relationships.

Discount fees represent a percentage of the dollar amount of each credit or debit transaction processed or a specified per transaction amount, depending on the card type. The Company frequently enters into agreements with clients under which the client engages the Company to provide both payment authorization services and transaction settlement services for all of the cardholder transactions of the client, regardless of which issuing bank and card network to which the transaction relates. The Company’s core performance obligations are to stand ready to provide continuous access to the Company’s payment authorization services and transaction settlement services in order to be able to process as many transactions as its clients require on a daily basis over the contract term. These services are stand ready obligations, as the timing and quantity of transactions to be processed is not determinable. Under a stand-ready obligation, the Company’s performance obligation is defined by each time increment rather than by the underlying activities satisfied over time based on days elapsed. Because the service of standing ready is substantially the same each day and has the same pattern of transfer to the client, the Company has determined that its stand-ready performance obligation comprises a series of distinct days of service. Discount fees are recognized each day based on the volume or transaction count at the time the merchants’ transactions are processed.

The Company follows the requirements of ASC 606-10-55 Revenue from Contracts with Customers—Principal versus Agent Considerations, which states that the determination of whether a company should recognize revenue based on the gross amount billed to a client or the net amount retained is a matter of judgment that depends on the facts and circumstances of the arrangement. The determination of gross versus net recognition of revenue requires judgment that depends on whether the Company controls the good or service before it is transferred to the merchant or whether the Company is acting as an agent of a third party. The assessment is provided separately for each performance obligation identified. Under its agreements, the Company incurs interchange and network pass-through charges from the third-party card issuers and card networks, respectively, related to the provision of payment authorization services. The Company has determined that it is acting as an agent with respect to these payment authorization services, based on the following factors: (1) the Company has no discretion over which card issuing bank will be used to process a transaction and is unable to direct the activity of the merchant to another card issuing bank, and (2) interchange and card network rates are pre-established by the card issuers or card networks, and the Company has no latitude in determining these fees. Therefore, revenue allocated to the payment authorization performance obligation is presented net of interchange and card network fees paid to the card issuing banks and card networks, respectively, for the year ended September 30, 2020, subsequent to the adoption of ASC 606.

With regards to the Company's discount fees, generally, where the Company has control over merchant pricing, merchant portability, credit risk and ultimate responsibility for the merchant relationship, revenues are reported at the time of sale equal to the full amount of the discount charged to the merchant, less interchange and network fees. Revenues generated from merchant portfolios where the Company does not have control over merchant pricing, liability for merchant losses or credit risk or rights of portability are reported net of interchange and network fees as well as third-party processing costs directly attributable to processing and bank sponsorship costs.

Revenues are also derived from a variety of fixed transaction or service fees, including authorization fees, convenience fees, statement fees, annual fees, gateway fees, which are charged for accessing our payment and software solutions, and fees for other miscellaneous services, such as handling chargebacks. Revenues derived from service fees are recognized at the time the services are performed and there are no further performance obligations. Revenue from fixed transactions, which principally relates to the sale of equipment, is recognized upon transfer of ownership and delivery to the client, after which there are no further performance obligations.

Revenues from sales of the Company’s software are recognized when the related performance obligations are satisfied. Sales of software licenses are categorized into one of two categories of intellectual property in accordance with ASC 606, functional or symbolic. The key distinction is whether the license represents a right to use (functional) or a right to access (symbolic) intellectual property. The Company generates sales of one-time software licenses, which is functional intellectual property. Revenue from functional intellectual property is recognized at a point in time, when delivered to the client. The Company also offers access to its software under software-as-a-service (“SaaS”) arrangements, which represent services arrangements. Revenue from SaaS arrangements is recognized over time, over the term of the agreement.

Arrangements may contain multiple performance obligations, such as payment authorization services, transaction settlement services, hardware, software products, maintenance, and professional installation and training services. Revenues are allocated to each performance obligation based on the standalone selling price of each good or service. The selling price for a deliverable is based on standalone selling price, if available, the adjusted market assessment approach, estimated cost plus margin approach, or residual approach. The Company establishes estimated selling price, based on the judgment of the Company's management, considering internal factors such as margin objectives, pricing practices and controls, client segment pricing strategies and the product life cycle. In arrangements with multiple performance obligations, the Company determines allocation of the transaction price at inception of the arrangement and uses the standalone selling prices for the majority of the Company's revenue recognition.

Revenues from sales of the Company’s combined hardware and software element are recognized when each performance obligation has been satisfied which has been determined to be upon the delivery of the product. Revenues derived from service fees are recognized at the time the services are performed and there are no further performance obligations. The Company’s professional services, including training, installation, and repair services are recognized as revenue as these services are performed.

The table below presents a disaggregation of the Company's revenue from contracts with clients by product by segment. Refer to Note 16 for discussion of the Company's segments. The Company's products are defined as follows:

•Payments — Includes discount fees, gateway fees and other related fixed transaction or service fees.

•Other — Includes sales of software, sales of equipment, professional services and other revenues.


	For the year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Payments revenue	$	82,913	$	19,359	$	(1,757)	$	100,515
Other revenue	18,036		31,594		(11)		49,619
Total revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

The table below presents a disaggregation of the Company's revenue from contracts with clients by timing of transfer of goods or services by segment. The Company's revenue included in each category are defined as follows:

•Revenue transferred over time — Includes discount fees, gateway fees, sales of SaaS and ongoing support contract revenue.

•Revenue transferred at a point in time — Includes fixed service fees, software licenses sold as functional intellectual property, professional services and other equipment.


	For the year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue earned over time	$	72,800	$	35,222	$	(1,743)	$	106,279
Revenue earned at a point in time	28,149		15,731		(25)		43,855
Total revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

Contract Liabilities

Deferred revenue represents amounts billed to clients by the Company for services contracts. Payment is typically collected at the start of the contract term. The initial prepaid contract agreement balance is deferred. The balance is then recognized as the services are provided over the contract term. Deferred revenue that is expected to be recognized as revenue within one year is recorded as short-term deferred revenue and the remaining portion is recorded as other long-term liabilities in the consolidated balance sheets. The terms for most of the Company's contracts with a deferred revenue component are one year. Substantially all of the Company's deferred revenue is anticipated to be recognized within the next year.

The following table presents the changes in deferred revenue as of and for the year ended September 30, 2020:


Balance at September 30, 2019	$	10,237
Deferral of revenue	22,963
Recognition of unearned revenue	(22,146)
Balance at September 30, 2020	$	11,054

Costs to Obtain and Fulfill a Contract

The Company capitalizes incremental costs to obtain new contracts and contract renewals and amortizes these costs on a straight-line basis as an expense over the benefit period, which is generally the contract term, unless a commensurate payment is not expected at renewal. As of September 30, 2020, the Company had $3,140, of capitalized contract costs, which relates to commissions paid to obtain new sales, included within “Prepaid expenses and other current assets” and “Other assets" on the consolidated balance sheets. The Company recorded commissions expense related to these costs for the year ended September 30, 2020 of $398.

The Company expenses sales commissions as incurred for the Company's sales commission plans that are paid on recurring monthly revenues, portfolios of existing clients, or have a substantive stay requirement prior to payment.

Interchange and Network Fees and Other Cost of Services

Interchange and network fees consist primarily of fees that are directly related to discount fee revenue. These include interchange fees paid to issuers and assessment fees payable to card associations, which are a percentage of the processing volume the Company generates from Visa and Mastercard, as well as fees charged by card-issuing banks. Other costs of services include costs directly attributable to processing and bank sponsorship costs, which may not be based on a percentage of volume. These costs also include related costs such as residual payments to sales groups, which are based on a percentage of the net revenues generated from merchant referrals. In certain merchant processing bank relationships the Company is liable for chargebacks against a merchant equal to the volume of the transaction. Losses resulting from chargebacks against a merchant are included in other cost of services on the accompanying consolidated statement of operations. The Company evaluates its risk for such transactions and estimates its potential loss from chargebacks based primarily on historical experience and other relevant factors. The reserve for merchant losses is included within accrued expenses and other current liabilities on the accompanying consolidated balance sheets. The cost of equipment sold is also included in other cost of services. Interchange and other costs of services are recognized at the time the merchant's transactions are processed.

The Company accounts for all governmental taxes associated with revenue transactions on a net basis.

Advertising and Promotion Costs

Advertising and promotion costs are expensed as incurred. Advertising expense was $1,813, $1,443 and $926 for the years ended September 30, 2020, 2019 and 2018, respectively, and is included in selling, general and administrative expenses in the Consolidated Statements of Operations.

Equity-based Compensation

The Company accounts for grants of equity awards to employees in accordance with ASC 718, Compensation—Stock Compensation. This standard requires compensation expense to be measured based on the estimated fair value of the share-based awards on the date of grant and recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period.

Equity-based compensation was $10,452, $6,124 and $1,567 for the years ended September 30, 2020, 2019 and 2018, respectively.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates include, but are not limited to, the value of purchase consideration paid and identifiable assets acquired and assumed in acquisitions, goodwill and intangible asset impairment review, warrant valuation, revenue recognition for contracts with multiple performance obligations, loss reserves, assumptions used in the calculation of equity-based compensation and in the calculation of income taxes, and certain tax assets and liabilities as well as the related valuation allowances. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. The impact of the COVID-19 pandemic on certain of the Company's estimates, including goodwill and intangible assets, is uncertain at this time. If general economic conditions continue to deteriorate or remain uncertain for an extended period of time, the trading price of our common stock, which has already declined in recent months, could decline further. If the stock price continues to be depressed or decreases further, it may cause a triggering event for impairment testing of fair-valued assets, including goodwill and intangible assets.

During the year ended September 30, 2020, the Company has recorded a $2,668 reduction in the valuation allowance on the deferred tax asset related to the Company’s investment in partnership and a corresponding reduction in the Company's income tax expense for the year ended September 30, 2020. Management has determined an additional portion of the deferred tax asset will be more likely than not realized based off an evaluation of the four sources of taxable income.

During the year ended September 30, 2020, the Company has elected to make a policy change to allocate stock compensation expense to the holders of shares of Class B common stock of i3 Verticals, Inc. This change resulted in a $235 reduction in the benefit from income taxes and a corresponding reduction in the Company's net loss, a $3,728 increase to the net loss attributable to non-controlling interest and a $3,493 decrease to the net loss attributable to i3 Verticals, Inc. for the year ended September 30, 2020.

Recently Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). The FASB issued updates and clarifications to ASU 2014-09, including ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Gross versus Net) issued in March 2016, ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing issued in April 2016 and ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients issued in May 2016. ASU 2014-09 supersedes the revenue recognition requirements in ASC 605. The new standard provides a five-step analysis of transactions to determine when and how revenue is recognized, based upon the core principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard also requires additional disclosures regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new standard, as amended, became effective for the Company on October 1, 2019. The amendment allows companies to use either a full retrospective or a modified retrospective approach, through a cumulative adjustment, to adopt this ASU No. 2014-09.

The new standard changed the timing of certain revenue and expenses to be recognized under various arrangement types. More judgment and estimates are required when applying the requirements of the new standard than were required under prior GAAP, such as estimating the amount of variable consideration to include in transaction price and estimating expected periods of benefit for certain costs. Through management's review of individual contracts and historical revenue recognition patterns in comparison to the provisions under ASU 2014-09, the Company determined the timing of revenue to be recognized under ASU 2014-09 for each of the Company’s revenue categories, including discount fees, software licensing subscriptions, ongoing support, and

other POS-related solutions, is similar to the timing of revenue recognized under the historical guidance under ASC 605. The Company will evaluate, on an ongoing basis, costs to obtain contracts with clients, as well as certain implementation and set-up costs, and, in some cases, may be required to amortize these costs over longer periods than they were historically amortized. Finally, the new standard required additional disclosures regarding revenues and related capitalized contract costs, if any.

The Company adopted the new revenue standard using a modified retrospective basis on October 1, 2019. The Company has recorded a $1,345 cumulative increase to equity, including a $705 cumulative increase to accumulated earnings and a $640 cumulative increase to non-controlling interest, as a result of the adoption, due to capitalized costs to obtain contracts with clients being amortized over the expected life of the client rather than the life of the specific contract.

The Company determined that the most significant ongoing impact of adopting the new revenue standard was driven by changes in principal versus agent considerations, with the majority of the change overall in total net revenue attributable to reflecting the Company's payment authorization services net of related interchange and network fees prospectively. The Company's interchange and network fees of $242,867 and $214,543 were classified in “Operating Expenses” on the consolidated statement of operations for the years ended September 30, 2019, and 2018, respectively. The Company's interchange and network fees of $244,097 were included as a reduction to revenue on the consolidated statement of operations for the year ended September 30, 2020. Under the modified retrospective basis, the Company has not restated its comparative consolidated financial statements for these effects. The adoption of the new revenue standard did not have a material impact on net income. The following table presents the material impacts of adopting ASC 606 on the Company's consolidated statement of operations for the year ended September 30, 2020:


	Year ended September 30, 2020
	As reported		Adjustment		Presentation without adoption of ASC 606
Revenue	$	150,134	$	244,097	$	394,231
Operating expenses
Interchange and network fees	$	—	$	244,097	$	244,097

The following table presents the material impacts of adoption of ASC 606 on the Company's consolidated balance sheet as of September 30, 2020:


	As of September 30, 2020
	As reported		Adjustment		Presentation without adoption of ASC 606
Assets
Current assets
Prepaid expenses and other current assets	$	4,869	$	304	$	5,173
Deferred tax asset	$	36,755	$	12	$	36,767
Other assets	$	5,197	$	(1,932)	$	3,265
Liabilities and equity
Stockholders' equity
Accumulated deficit	$	(2,023)	$	(872)	$	(2,895)
Non-controlling interest	$	84,590	$	(744)	$	83,846

The adoption of ASC 606 did not have a material impact on the Company’s consolidated statement of cash flows for the year ended September 30, 2020. The Company has expanded its consolidated financial statement disclosures as required by this new standard. See above for additional disclosures provided as a result of the adoption of ASC 606.

Recently Issued Accounting Pronouncements Not Yet Adopted

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement: Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820) (“ASU 2018-13”). The amendments in ASU 2018-13 provide clarification and modify the disclosure requirements on fair value measurement in Topic 820, Fair Value Measurement. The amendments in ASU 2018-13 are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. As the Company is an emerging growth company and has elected to use the extended transition period of such companies, the Company will not be required to adopt ASU 2018-13 until October 1, 2021. The Company is currently evaluating the impact of the adoption of this principle on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) (“ASU 2016-13”). The amendments in ASU 2016-13 require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. The amendments in ASU 2016-13 are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In November 2019, the FASB issued ASU No. 2019-10 (“ASU 2019-10”), which extends the effective date for adoption of ASU 2016-13 for certain entities. As a result of the provisions in ASU 2019-10, and as the Company was a smaller reporting company as of November 15, 2019, the Company will not be required to adopt ASU 2016-13 until October 1, 2023. The Company is currently evaluating the impact of the adoption of this principle on the Company’s consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), with amendments in 2018 and 2019. This ASU No. 2016-02 aims to increase transparency and comparability among organizations by requiring recognition of lease assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements.

The amendments in this ASU No. 2016-02 are effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption permitted. In November 2019, the FASB issued ASU No. 2019-10, which extends the effective date for adoption of ASU 2016-02 for certain entities. In June 2020, the FASB issued ASU No. 2020-05, which further extends the effective date for adoption of ASU 2016-02 for certain entities. As a result of the provisions in ASU No. 2020-05, and as the Company is an emerging growth company and has elected to use the extended transition period of such companies, the Company would not be required to adopt this ASU No. 2016-02 until October 1, 2022. The Company has elected to early adopt this ASU No. 2016-02 on October 1, 2020, using the optional modified retrospective transition method, under which the prior period financial statements were not restated for the new guidance.

The Company has elected to apply the package of practical expedients whereby the Company does not reassess whether expired or existing leases contain a lease, does not reassess the lease classification for any expired or existing leases, and does not reassess initial direct costs for any existing leases. The Company has further elected to account for lease and nonlease components in a lease arrangement as a combined lease component for all classes of leased assets.

The Company has calculated that the adoption of Topic 842 will result in the recognition of the right-of-use assets of $9,093 and the lease liabilities of $9,760 as of October 1, 2020 on the consolidated balance sheet. Lease liabilities will be measured as the present value of remaining lease payments, utilizing the Company’s

incremental borrowing rate based on the remaining lease term as of the adoption date. The right-of-use assets will be measured at an amount equal to the lease liabilities adjusted by the amounts of certain assets and liabilities, such as deferred lease obligations and prepaid rent, that were previously recognized on the balance sheet prior to the initial application of Topic 842.

The Company does not expect the adoption of Topic 842 to have an impact on the consolidated statements of operations and comprehensive (loss) income, consolidated statements of changes in equity, and consolidated statements of cash flows.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). The amendments in ASU 2020-04 provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in ASU 2020-04 are effective for all entities as of March 12, 2020 through December 31, 2022. An entity may elect to apply the amendments for contract modifications by Topic or Industry Subtopic as of any date from the beginning an interim period that includes or is subsequent to March 12, 2020, or prospectively from the date that the financial statements are available to be issued. Once elected for a Topic or an Industry Subtopic, the amendments must be applied prospectively for all eligible contract modifications for that Topic or Industry Subtopic. The Company may elect to apply ASU 2020-04 as its contracts referenced in London Interbank Offered Rate (“LIBOR”) are impacted by reference rate reform. The Company is currently evaluating the impact of the adoption of this principle on the Company’s consolidated financial statements.

In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40)—Accounting For Convertible Instruments and Contracts in an Entity's Own Equity (“ASU 2020-06”). ASU 2020-06 simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. ASU 2020-06 also simplifies the diluted net income per share calculation in certain areas. The amendments in ASU 2020-06 are effective for public business entities for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, with early adoption permitted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. As the Company is an emerging growth company and has elected to use the extended transition period of such companies, the Company will not be required to adopt ASU 2020-06 until October 1, 2022. The Company is currently evaluating the impact of the adoption of this principle on the Company’s consolidated financial statements.

Credit Risk and Other Concentrations	12 Months Ended
Credit Risk and Other Concentrations	Sep. 30, 2020
Risks and Uncertainties [Abstract]
Credit Risk and Other Concentrations	CREDIT RISK AND OTHER CONCENTRATIONS The Company places its cash with high credit quality financial institutions which provide Federal Deposit Insurance Corporation insurance. The Company performs periodic evaluations of the relative credit standing of these institutions and does not expect any losses related to such concentrations. The Company’s revenues are earned by processing transactions for merchant businesses and other institutions under contract with the Company. The Company utilizes the funds settlement services of primarily six processing banks, from which most accounts receivable are remitted monthly. No single merchant accounted for more than 10.0% of the Company's revenue during the years ended September 30, 2020, 2019 and 2018. The Company believes that the loss of any single merchant would not have a material adverse effect on the Company's financial condition or results of operations. The Company uses third party payment processors, three of which facilitate more than 10% of our processing revenues for the years ended September 30, 2020, 2019, and 2018.

Acquisitions

12 Months Ended

Sep. 30, 2020

Business Combinations [Abstract]

Acquisitions

ACQUISITIONS

During the years ended September 30, 2020, 2019 and 2018 the Company acquired the following intangible assets and businesses:

Residual Buyouts

From time to time, the Company acquires future commission streams from sales agents in exchange for an upfront cash payment. This results in an increase in overall gross processing volume to the Company. The residual buyouts are treated as asset acquisitions, resulting in recording a residual buyout intangible asset at cost on the date of acquisition. These assets are amortized using a method of amortization that reflects the pattern in which the economic benefits of the intangible asset are expected to be utilized over their estimated useful lives.

During the years ended September 30, 2020, 2019 and 2018, the Company purchased $1,788, $3,585 and $1,567, respectively, in residual buyouts using a combination of cash on hand and borrowings on the Company's revolving credit facility. The acquired residual buyout intangible assets have weighted average estimated amortization periods of eight, seven and two years, respectively.

Referral Agreements

From time to time, the Company enters into referral agreements with agent banks or other organizations (“referral partner”). Under these agreements, the referral partner exclusively refers its customers to the Company for credit card processing services. Total consideration paid for these agreements in the years ended September 30, 2020, 2019 and 2018 was $0, $0 and $815, respectively, all of which was settled with cash on hand. Because the Company pays an up-front fee to compensate the referral partner, the amount is treated as an asset acquisition in which the Company has acquired an intangible stream of referrals. This asset is amortized over a straight-line period. The weighted-average amortization period for all intangibles acquired is five years.

2018 Business Combinations

During the year ended September 30, 2018, the Company completed the acquisitions of businesses, including San Diego Cash Register Company, Inc., and additional unrelated businesses which were considered individually immaterial but collectively material.

Purchase of San Diego Cash Register Company, Inc.

On October 31, 2017, the Company closed an agreement to purchase all of the outstanding stock of San Diego Cash Register Company, Inc. (“SDCR, Inc.”). The acquisition was completed to expand the Company's revenue within the integrated POS market. Total purchase consideration was $20,834, which includes $104 of common units in i3 Verticals, LLC issued to the seller. The acquisition was funded using $20,000 in proceeds from the issuance of long-term debt from the 2017 Senior Secured Credit Facility (as defined in Note 9) and $730 of contingent cash consideration.

Acquisition-related costs for SDCR, Inc. were $293 and were expensed as incurred.

Certain provisions in the purchase agreement provide for additional consideration of up to $2,400, in the aggregate, to be paid based upon the achievement of specified financial performance targets, as defined in the purchase agreement, through October 2019. The Company determined the acquisition date fair value of the liability for the contingent consideration based on a discounted cash flow analysis. In each subsequent reporting

period the Company reassesses its current estimates of performance relative to the targets and adjusts the contingent liability to its fair value through earnings. See additional disclosures in Note 11.

Other 2018 Business Combinations

The Company completed the acquisitions of the other businesses to expand the Company's merchant base. Total purchase consideration for the other acquisitions was $15,604, including $13,700 in cash and revolving credit facility proceeds, $550 of restricted Class A common stock and $1,354 of contingent cash consideration.

The goodwill associated with the acquisitions of the other businesses is deductible for tax purposes. The acquired merchant relationships intangible assets have estimated amortization periods of between twelve and fifteen years. The exclusivity agreement acquired has an estimated amortization period of ten years. The non-compete agreements and trade name have weighted-average amortization periods of five years. The weighted-average amortization period for all intangibles acquired is twelve years.

Acquisition-related costs for the other businesses amounted to approximately $233 and were expensed as incurred.

Certain provisions in the purchase agreements for the other businesses provide for additional consideration of up to $11,800, in the aggregate, to be paid based upon the achievement of specified financial performance targets, as defined in the purchase agreements, through no later than January 2020. The Company determined the acquisition date fair values of the liabilities for the contingent consideration based on discounted cash flow analyses. In each subsequent reporting period, the Company will reassess its current estimates of performance relative to the targets and adjust the contingent liabilities to their fair values through earnings. See additional disclosures in Note 11.

Summary of 2018 Business Combinations

The fair values assigned to certain assets and liabilities assumed, as of the acquisition dates, during the year ended September 30, 2018 were as follows:


	SDCR, Inc.		Other		Total
Cash and cash equivalents	$	1,338	$	—	$	1,338
Accounts receivable	1,008		—		1,008
Settlement assets	—		350		350
Related party receivable	773		—		773
Inventories	1,318		—		1,318
Prepaid expenses and other current assets	1,176		8		1,184
Property and equipment	69		58		127
Capitalized software	—		200		200
Acquired merchant relationships	5,500		5,100		10,600
Exclusivity Agreements	—		100		100
Non-compete agreements	40		1,440		1,480
Trade name	1,340		200		1,540
Goodwill	16,523		8,914		25,437
Other assets	—		4		4
Total assets acquired	29,085		16,374		45,459

Accounts payable	1,342		—		1,342
Accrued expenses and other current liabilities	3,123		431		3,554
Settlement obligations	—		350		350
Deferred revenue, current	2,029		190		2,219
Other long-term liabilities	1,757		—		1,757
Net assets acquired	$	20,834	$	15,403	$	36,237

2019 Business Combinations

During the year ended September 30, 2019, the Company completed the acquisitions of unrelated businesses, including Pace Payment Systems, Inc.

Purchase of Pace Payment Systems, Inc.

On May 31, 2019, i3-Holdings Sub, Inc. acquired all of the stock of Pace Payment Systems, Inc. (“Pace”) via a reverse triangular merger involving Pace and a special acquisition subsidiary of i3-Holdings Sub, Inc. The Company acquired Pace to expand its software offerings, primarily in the public sector and education verticals. The total purchase consideration was $56,053, including $52,492 in cash consideration, funded by proceeds from the Company's revolving credit facility, $3,336 of contingent consideration and $225 of restricted shares of Class A common stock in i3 Verticals.

The goodwill associated with the acquisition is not deductible for tax purposes. The acquired merchant relationships intangible asset has an estimated amortization period of fifteen years. The non-compete agreement and trade name have estimated amortization periods of three and five years, respectively. The weighted-average estimated amortization period of all intangibles acquired is fifteen years. The acquired capitalized software has an estimated amortization period of seven years. The acquisition also included deferred tax assets related to net

operating losses and Section 163(j) carryforwards and deferred tax liabilities related to intangibles, which are presented as a total net deferred tax asset as of September 30, 2020.

Acquisition-related costs for Pace amounted to approximately $507 ($444 during fiscal year 2019) and were expensed as incurred.

Certain provisions in the merger agreement provide for additional consideration of up to $20,000 in the aggregate, to be paid based upon achievement of specified financial performance targets, as defined in the purchase agreement, in the 24 months from January 1, 2020 through December 31, 2021. The Company determined the acquisition date fair value of the liability for the contingent consideration based on a discounted cash flow analysis. In each subsequent reporting period, the Company will reassess the current estimates of performance relative to the targets and adjust the contingent liability to its fair value through earnings. See additional disclosures in Note 11.

Other 2019 Business Combinations

The Company completed the acquisitions of other businesses to expand the Company’s software offerings in the public sector vertical market, provide technology that enhances the Company’s Burton Platform and expand the Company's merchant base. Total purchase consideration was $98,887, including $89,191 in revolving credit facility proceeds and $9,696 of contingent consideration.

For some of these businesses acquired, the goodwill associated with the acquisitions is deductible for tax purposes, and goodwill associated with the acquisitions of others of the businesses is not deductible for tax purposes. The acquired merchant relationships intangible assets have estimated amortization periods of between thirteen and twenty years. The non-compete agreement and trade names have weighted-average amortization periods of three and five years, respectively. The weighted-average amortization period for all intangibles acquired is sixteen years. The acquired capitalized software has an estimated amortization period of six years.

Acquisition-related costs for these businesses amounted to approximately $1,299 ($1,179 during fiscal year 2019) and were expensed as incurred.

Certain provisions in the purchase agreements provide for additional consideration of up to $34,900, in the aggregate, to be paid based upon the achievement of specified financial performance targets, as defined in the purchase agreements, through no later than September 2021. The Company determined the acquisition date fair values of the liabilities for the contingent consideration based on probability forecasts and discounted cash flow analyses. In each subsequent reporting period, the Company will reassess its current estimates of performance relative to the targets and adjust the contingent liabilities to their fair values through earnings. See additional disclosures in Note 11.

Summary of 2019 Business Combinations

The fair values assigned to certain assets and liabilities assumed, as of the acquisition dates, were as follows:


	Pace		Other		Total
Cash and cash equivalents	$	108	$	4,453	$	4,561
Accounts receivable	545		4,907		5,452
Settlement assets	—		18		18
Inventories	45		61		106
Prepaid expenses and other current assets	59		483		542
Property and equipment	527		1,929		2,456
Capitalized software	3,400		9,440		12,840
Acquired merchant relationships	13,400		34,480		47,880
Non-compete agreements	60		150		210
Trade name	500		1,540		2,040
Goodwill	35,589		47,483		83,072
Other assets	2,622		2		2,624
Total assets acquired	56,855		104,946		161,801

Accounts payable	722		369		1,091
Accrued expenses and other current liabilities	56		2,284		2,340
Settlement obligations	—		18		18
Deferred revenue, current	24		2,698		2,722
Other long-term liabilities	—		690		690
Net assets acquired	$	56,053	$	98,887	$	154,940

During the year ended September 30, 2020, the Company finalized the purchase price allocations for the 2019 business combinations, which resulted in additional adjustments to increase current assets by $153, increase other assets by $933, decrease liabilities by $258 and decrease goodwill by $1,227. The table above reflects the adjusted amounts.

2020 Business Combinations

During the year ended September 30, 2020, the Company completed the acquisitions of three unrelated businesses. Two expand the Company's geographic reach and software capabilities in the public sector vertical. The other adds text-to-pay capabilities and other software solutions in the Company's non-profit vertical. Total purchase consideration was $32,633, including $27,885 in revolving credit facility proceeds and $4,748 of contingent consideration. Certain of the purchase price allocations assigned for these acquisitions are preliminary.

For some of these business acquired, the goodwill associated with the acquisitions is deductible for tax purposes, and goodwill associated with the acquisitions of others of the businesses is not deductible for tax purposes. The acquired merchant relationships intangible assets have estimated amortization periods of between fifteen and eighteen years. The non-compete agreement and trade names both have weighted-average amortization periods three years. The weighted-average amortization period for all intangibles acquired is sixteen years. The acquired capitalized software has an estimated amortization period of seven years.

Acquisition-related costs for these businesses amounted to approximately $547 and were expensed as incurred.

Certain provisions in the purchase agreements provide for additional consideration of up to $18,600, in the aggregate, to be paid based upon the achievement of specified financial performance targets, as defined in the purchase agreements, through no later than September 2022. The Company determined the acquisition date fair values of the liabilities for the contingent consideration based on probability forecasts and discounted cash flow analyses. In each subsequent reporting period, the Company will reassess its current estimates of performance relative to the targets and adjust the contingent liabilities to their fair values through earnings. See additional disclosures in Note 11.

Summary of 2020 Business Combinations

The fair values assigned to certain assets and liabilities assumed, as of the acquisition dates, during the year ended September 30, 2020 were as follows:


Cash and cash equivalents	$	313
Accounts receivable	709
Prepaid expenses and other current assets	54
Property and equipment	122
Capitalized software	1,970
Acquired merchant relationships	11,900
Non-compete agreements	90
Trade name	300
Goodwill	19,948
Other assets	17
Total assets acquired	35,423

Accounts payable	168
Accrued expenses and other current liabilities	623
Deferred revenue, current	200
Other long-term liabilities	1,799
Net assets acquired	$	32,633

Pro Forma Results of Operations for 2020 Business Combinations

The following unaudited supplemental pro forma results of operations have been prepared as though each of the acquired businesses in the year ended September 30, 2020 had occurred on October 1, 2018. Pro forma adjustments were made to reflect the impact of depreciation and amortization, changes to executive compensation and the revised debt load, all in accordance with ASC 805. This supplemental pro forma information does not purport to be indicative of the results of operations that would have been attained had the acquisitions been made on these dates, or of results of operations that may occur in the future.


	Year ended September 30,
	2020		2019
Revenue(1)	$	156,036	$	383,546
Net (loss) income	$	(1,170)	$	472

__________________________

1.Effective October 1, 2019, our revenues are presented net of interchange and network fees in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers. See Note 2 for a description of the recently adopted accounting pronouncement.

Property and Equipment, Net

12 Months Ended

Sep. 30, 2020

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

PROPERTY AND EQUIPMENT, NET

A summary of the Company's property and equipment as of September 30, 2020 and 2019 is as follows:


	Estimated Useful Life	2020		2019
Computer equipment and software(1)	2 to 7 years	$	2,382	$	1,990
Furniture and fixtures	2 to 7 years	1,867		1,639
Terminals	2 to 3 years	584		429
Office equipment	2 to 5 years	942		940
Automobiles	3 years	366		307
Leasehold improvements	2 to 7 years	2,194		1,665
Accumulated depreciation		(2,996)		(1,944)
Property and equipment, net		$	5,339	$	5,026

____________________

1.Includes computer software of $694 and $674 as of September 30, 2020 and 2019, respectively.

Depreciation expense for the years ended September 30, 2020, 2019 and 2018 amounted to $1,825, $1,195 and $802, respectively.

Capitalized Software, Net

12 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Capitalized Software, Net

CAPITALIZED SOFTWARE, NET

A summary of the Company's capitalized software as of September 30, 2020 and 2019 is as follows:


	Estimated Useful Life	2020		2019
Software development costs	1 to 7 years	$	21,485	$	20,347
Development in progress		2,638		833
Accumulated amortization		(7,134)		(5,726)
Capitalized software, net		$	16,989	$	15,454

The Company capitalized software development costs (including acquisitions) totaling $5,756 and $15,067 during the years ended September 30, 2020 and 2019, respectively. Amortization expense for capitalized software development costs amounted to $3,978, $2,977 and $1,696 during the years ended September 30, 2020, 2019 and 2018, respectively.

Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

GOODWILL AND INTANGIBLE ASSETS

Changes in the carrying amount of goodwill are as follows:


	Merchant Services		Proprietary Software and Payments		Other		Total
Balance at September 30, 2018 (net of accumulated impairment losses of $11,458, $0 and $0, respectively)	$	70,936	$	13,018	$	—	$	83,954
Goodwill attributable to preliminary purchase price adjustments and acquisition activity during the year ended September 30, 2019	46,398		37,932		—		84,330
Balance at September 30, 2019	117,334		50,950		—		168,284
Goodwill reassigned in segment realignment(1)	(419)		419		—		—
Goodwill attributable to preliminary purchase price adjustments and acquisition activity during the year ended September 30, 2020	(933)		19,654		—		18,721
Balance at September 30, 2020	$	115,982	$	71,023	$	—	$	187,005

____________________

1.Represents the reallocation of goodwill related to a component which was realigned from the Proprietary Software and Payments segment to the Merchant Services segment as of July 1, 2020. See Note 16 for additional information.

Intangible assets consisted of the following as of September 30, 2020:


	Cost		Accumulated Amortization		Carrying Value		Amortization Life and Method
Finite-lived intangible assets:
Merchant relationships	$	154,571	$	(53,388)	$	101,183	12 to 20 years – accelerated or straight-line
Non-compete agreements	1,700		(851)		849		3 to 5 years – straight-line
Website and brand development costs	215		(65)		150		3 to 4 years – straight-line
Trade names	3,880		(1,538)		2,342		3 to 7 years – straight-line
Residual buyouts	5,373		(1,172)		4,201		2 to 8 years – straight-line
Referral and exclusivity agreements	900		(434)		466		5 to 10 years – straight-line
Total finite-lived intangible assets	166,639		(57,448)		109,191

Indefinite-lived intangible assets:
Trademarks	42		—		42
Total identifiable intangible assets	$	166,681	$	(57,448)	$	109,233

Intangible assets consisted of the following as of September 30, 2019:


	Cost		Accumulated Amortization		Carrying Value		Amortization Life and Method
Finite-lived intangible assets:
Merchant relationships	$	142,671	$	(43,579)	$	99,092	12 to 20 years – accelerated or straight-line
Non-compete agreements	1,770		(619)		1,151		2 to 5 years – straight-line
Website development costs	77		(22)		55		3 years – straight-line
Trade names	4,292		(1,307)		2,985		3 to 7 years – straight-line
Residual buyouts	5,346		(1,882)		3,464		2 to 8 years – straight-line
Referral and exclusivity agreements	900		(264)		636		5 to 10 years – straight-line
Total finite-lived intangible assets	155,056		(47,673)		107,383

Indefinite-lived intangible assets:
Trademarks	36		—		36
Total identifiable intangible assets	155,092		(47,673)		107,419

Amortization expense for intangible assets amounted to $12,414, $12,394 and $9,341 during the years ended September 30, 2020, 2019 and 2018, respectively.

Based on gross carrying amounts at September 30, 2020, the Company's estimate of future amortization expense for intangible assets are presented in this table as follows for each fiscal year ending September 30:


2021	$	11,645
2022	10,500
2023	9,428
2024	8,702
2025	8,495
Thereafter	60,421
	$	109,191

Accrued Expenses and Other Liabilities

12 Months Ended

Sep. 30, 2020

Payables and Accruals [Abstract]

Accrued Expenses and Other Liabilities

ACCRUED EXPENSES AND OTHER LIABILITIES

A summary of the Company's accrued expenses and other current liabilities as of September 30, 2020 and 2019 is as follows:


	2020		2019
Accrued wages, bonuses, commissions and vacation	$	3,867	$	4,256
Accrued interest	141		254
Accrued contingent consideration — current portion	10,062		10,223
Escrow liabilities	4,363		1,414
Tax receivable agreement liability — current portion	—		24
Customer deposits	1,828		1,968
Other current liabilities	3,803		3,421
Accrued expenses and other current liabilities	$	24,064	$	21,560

A summary of the Company's long-term liabilities as of September 30, 2020 and 2019 is as follows:


	2020		2019
Accrued contingent consideration — long-term portion	$	2,972	$	8,003
Deferred tax liability — long-term	2,212		516
Other long-term liabilities	956		605
Total other long-term liabilities	$	6,140	$	9,124

Long-Term Debt, Net

12 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

Long-Term Debt, Net

LONG-TERM DEBT, NET

A summary of long-term debt, net as of September 30, 2020 and September 30, 2019 is as follows:


	Maturity	2020		2019
Revolving lines of credit to banks under the Senior Secured Credit Facility	May 9, 2024	$	—	$	141,144
1.0% Exchangeable Senior Notes due 2025	February 15, 2025	95,325		—
Debt issuance costs, net		(4,567)		(1,846)
Total long-term debt, net of issuance costs		$	90,758	$	139,298

2020 Exchangeable Notes Offering

On February 18, 2020, i3 Verticals, LLC issued $138,000 aggregate principal amount of 1.0% Exchangeable Senior Notes due 2025 (the “Exchangeable Notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The Company received approximately $132,762 in net proceeds from the sale of the Exchangeable Notes, as determined by deducting estimated offering expenses paid to third-parties from the aggregate principal amount.

The Exchangeable Notes are senior secured notes and are guaranteed solely by the Company. The Exchangeable Notes bear interest at a fixed rate of 1.00% per year, payable semiannually in arrears on February

15 and August 15 of each year, beginning on August 15, 2020. The Exchangeable Notes will mature on February 15, 2025, unless converted or repurchased at an earlier date.

i3 Verticals, LLC issued the Exchangeable Notes pursuant to an Indenture, dated as of February 18, 2020 (the “Indenture”), among i3 Verticals, LLC, the Company and U.S. Bank National Association, as trustee.

Prior to August 15, 2024, the Exchangeable Notes are exchangeable only upon satisfaction of certain conditions and during certain periods described in the Indenture, and thereafter, the Exchangeable Notes are exchangeable at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. The Exchangeable Notes are exchangeable on the terms set forth in the Indenture into cash, shares of Class A common stock, or a combination thereof, at i3 Verticals, LLC’s election. The exchange rate is initially 24.4666 shares of Class A common stock per $1,000 principal amount of Exchangeable Notes (equivalent to an initial exchange price of approximately $40.87 per share of Class A common stock). The exchange rate is subject to adjustment in certain circumstances. In addition, following certain corporate events that occur prior to the maturity date or i3 Verticals, LLC’s delivery of a notice of redemption, i3 Verticals, LLC will increase, in certain circumstances, the exchange rate for a holder who elects to exchange its Exchangeable Notes in connection with such a corporate event or notice of redemption, as the case may be.

If the Company or i3 Verticals, LLC undergoes a fundamental change, holders may require i3 Verticals, LLC to repurchase all or part of their Exchangeable Notes at a repurchase price equal to 100% of the principal amount of the Exchangeable Notes to be repurchased, plus accrued and unpaid interest to, but not including, the fundamental change repurchase date. As of September 30, 2020, none of the conditions permitting the holders of the Exchangeable Notes to early convert have been met.

i3 Verticals, LLC may not redeem the Exchangeable Notes prior to February 20, 2023. On or after February 20, 2023, and prior to the 47th scheduled trading day immediately preceding the maturity date, if the last reported sale price per share of Class A common stock has been at least 130% of the exchange price for the Exchangeable Notes for at least 20 trading days (whether or not consecutive), i3 Verticals, LLC may redeem all or any portion of the Exchangeable Notes at a cash redemption price equal to 100% of the principal amount of the Exchangeable Notes to be redeemed plus accrued and unpaid interest on such note to, but not including, the redemption date.

The Exchangeable Notes are general senior unsecured obligations of i3 Verticals, LLC and the guarantee is the Company’s senior unsecured obligation and rank senior in right of payment to all of i3 Verticals, LLC’s and the Company’s future indebtedness that is expressly subordinated in right of payment to the Exchangeable Notes or the guarantee, as applicable. The Exchangeable Notes and the guarantee rank equally in right of payment with all of i3 Verticals, LLC’s and the Company’s existing and future unsecured indebtedness that is not so expressly subordinated in the right of payment to the Exchangeable Notes or the guarantee, as applicable. The Exchangeable Notes and the guarantee are effectively subordinated to any of the Companies’ existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness (including obligations under the credit agreement governing the Senior Secured Credit Facility, defined below). The Exchangeable Notes and the guarantee will be structurally subordinated to all indebtedness and other liabilities and obligations (including the debt and trade payables) of the Company’s subsidiaries, other than i3 Verticals, LLC.

In accounting for the issuance of the Exchangeable Notes, the Company separated the Exchangeable Notes into liability and equity components. The carrying amount of the liability component before the allocation of any transaction costs was calculated by measuring the fair value of a similar liability that does not have an associated exchangeable feature. The carrying amount of the equity component (before the allocation of any transaction costs), representing the conversion option, which does not require separate accounting as a derivative as it meets a scope exception for certain contracts involving an entity's own equity, was determined by deducting the fair value of the liability component from the par value of the Exchangeable Notes. The difference between the principal amount of the Exchangeable Notes and the liability component represents the debt discount, which is recorded as a direct deduction from the related debt liability in the consolidated balance sheet and accreted over

the period from the date of issuance to the contractual maturity date, resulting in the recognition of non-cash interest expense. The equity component of the Exchangeable Notes of approximately $28,662 is included in additional paid-in capital in the consolidated balance sheet and is not remeasured as longs as it continues to meet the conditions for equity classification. Transaction costs were allocated to the liability and equity components in the same proportion as the allocation of the proceeds. Transaction costs attributable to the liability component were recorded as debt issuance costs in the consolidated balance sheet and are amortized to interest expense using the effective interest method over the term of the Exchangeable Notes, and transaction costs attributable to the equity component were netted with the equity component in stockholders' equity.

The Company incurred third-party issuance costs totaling $5,238, in connection with the issuance of the Exchangeable Notes. The Company capitalized $4,150 of debt issuance costs in connection with the Exchangeable Notes and allocated $1,088 of the third-party issuance costs to equity. Non-cash interest expense, including amortization of debt issuance costs, related to the Exchangeable Notes for the year ended September 30, 2020 was $365, respectively. The Company also wrote off a portion of the debt issuance costs in connection with the repurchase transactions in April and September 2020, as described below. Total unamortized debt issuance costs related to the Exchangeable Notes were $3,193 as of September 30, 2020.

The estimated fair value of the Exchangeable Notes was $102,064 as of September 30, 2020. The estimated fair value of the Exchangeable Notes was determined through consideration of quoted market prices for similar instruments. The fair value is classified as Level 2, as defined in Note 11.

The Company can choose to purchase its Exchangeable Notes on the open market. In April and September 2020, the Company paid $17,414 in aggregate to repurchase $21,000 in aggregate principal amount of the Exchangeable Notes and to repay approximately $24 in accrued interest on the repurchased portion of the Exchangeable Notes. The Company recorded a loss on retirement of debt of $2,297 due to the carrying value exceeding the fair value of the repurchased portion of the Exchangeable Notes at the dates of repurchases. The Company wrote off $592 of debt issuance costs in connection with the repurchase transactions.

Exchangeable Note Hedge Transactions

On February 12, 2020, concurrently with the pricing of the Exchangeable Notes, and on February 13, 2020, concurrently with the exercise by the initial purchasers of their right to purchase additional Exchangeable Notes, i3 Verticals, LLC entered into exchangeable note hedge transactions with respect to Class A common stock (the “Note Hedge Transactions”) with certain financial institutions (collectively, the “Counterparties”). The Note Hedge Transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Exchangeable Notes, the same number of shares of Class A common stock that initially underlie the Exchangeable Notes in the aggregate and are exercisable upon exchange of the Exchangeable Notes. The Note Hedge Transactions are intended to reduce potential dilution to the Class A common stock upon any exchange of the Exchangeable Notes. The Note Hedge Transactions will expire upon the maturity of the Exchangeable Notes, if not earlier exercised. The Note Hedge Transactions are separate transactions, entered into by i3 Verticals, LLC with the Counterparties, and are not part of the terms of the Exchangeable Notes. Holders of the Exchangeable Notes will not have any rights with respect to the Note Hedge Transactions. i3 Verticals, LLC used approximately $28,676 of the net proceeds from the offering of the Exchangeable Notes (net of the premiums received for the warrant transactions described below) to pay the cost of the Note Hedge Transactions.

The Note Hedge Transactions do not require separate accounting as a derivative as they meet a scope exception for certain contracts involving an entity's own equity. The premiums paid for the Note Hedge Transactions have been included as a net reduction to additional paid-in capital within stockholders' equity.

Warrant Transactions

On February 12, 2020, concurrently with the pricing of the Exchangeable Notes, and on February 13, 2020, concurrently with the exercise by the initial purchasers of their right to purchase additional Exchangeable Notes, the Company entered into warrant transactions to sell to the Counterparties warrants (the “Warrants”) to acquire,

subject to customary adjustments, up to initially 3,376,391 shares of Class A common stock in the aggregate at an initial exercise price of $62.88 per share. The Company offered and sold the Warrants in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. The Warrants will expire over a period beginning on May 15, 2025.

The Warrants are separate transactions, entered into by the Company with the Counterparties, and are not part of the terms of the Exchangeable Notes. Holders of the Exchangeable Notes will not have any rights with respect to the Warrants. The Company received approximately $14,669 from the offering and sale of the Warrants. The Warrants do not require separate accounting as a derivative as they meet a scope exception for certain contracts involving an entity's own equity. The premiums paid for the Warrants have been included as a net increase to additional paid-in capital within stockholders' equity.

Senior Secured Credit Facility

On May 9, 2019, the Company replaced its existing 2017 Senior Secured Credit Facility (defined below) with a new credit agreement (the “Senior Secured Credit Facility”). The Company concluded that the replacement of the 2017 Senior Secured Credit Facility should be accounted for as a debt modification based on the guidance in ASC 470-50. In connection with the replacement of the 2017 Senior Secured Credit Facility, the Company recorded a debt extinguishment charge of $152 for the write-off of deferred financing costs, which was recorded in interest expense in the consolidated statements of operations. The Senior Secured Credit Facility, as amended on February 18, 2020 in connection with our offering of Exchangeable Notes, consists of a $275,000 revolving credit facility, together with an option to increase the revolving credit facility and/or obtain incremental term loans in an additional principal amount of up to $50,000 in the aggregate (subject to the receipt of additional commitments for any such incremental loan amounts). The Senior Secured Credit Facility accrues interest at LIBOR (based upon an interest period of one, two, three or six months or, under some circumstances, up to twelve months) plus an applicable margin of 2.25% to 3.25% (3.25% as of September 30, 2020), or the base rate (defined as the highest of (x) the Bank of America prime rate, (y) the federal funds rate plus 0.50% and (z) LIBOR plus 1.00%), plus an applicable margin of 0.25% to 1.25% (1.25% as of September 30, 2020), in each case depending upon the consolidated total leverage ratio, as defined in the agreement. Interest is payable at the end of the selected interest period, but no less frequently than quarterly. Additionally, the Senior Secured Credit Facility requires the Company to pay unused commitment fees of 0.15% to 0.30% (0.30% as of September 30, 2020) on any undrawn amounts under the revolving credit facility and letter of credit fees of up to 3.25% on the maximum amount available to be drawn under each letter of credit issued under the agreement. The Senior Secured Credit Facility requires maintenance of certain financial ratios on a quarterly basis as follows: (i) a minimum consolidated interest coverage ratio of 3.00 to 1.00, (ii) a maximum total leverage ratio of 5.00 to 1.00, provided, that for each of the four fiscal quarters immediately following a qualified acquisition (each a “Leverage Increase Period”), the required ratio set forth above may be increased by up to 0.25, subject to certain limitations and (iii) a maximum consolidated senior secured leverage ratio of 3.25 to 1.00, provided, that for each Leverage Increase Period, the consolidated senior leverage ratio may be increased by up to 0.25, subject to certain limitations. The maturity date of the Senior Secured Credit Facility is May 9, 2024. As of September 30, 2020, there was $275,000 available for borrowing under the revolving credit facility, subject to the financial covenants.

The Senior Secured Credit Facility is secured by substantially all assets of the Company. The lenders under the Senior Secured Credit Facility hold senior rights to collateral and principal repayment over all other creditors.

The provisions of the Senior Secured Credit Facility place certain restrictions and limitations upon the Company. These include, among others, restrictions on liens, investments, indebtedness, fundamental changes and dispositions; maintenance of certain financial ratios; and certain non-financial covenants pertaining to the activities of the Company during the period covered. The Company was in compliance with such covenants as of September 30, 2020. In addition, the Senior Secured Credit Facility restricts the Company's ability to make dividends or other distributions to the holders of the Company's equity. The Company is permitted to (i) make cash distributions to the holders of the Company's equity in order to pay taxes incurred by owners of equity in i3 Verticals, LLC, by reason of such ownership, (ii) move intercompany cash between subsidiaries that are joined to the Senior Secured Credit Facility, (iii) repurchase equity from employees, directors, officers or consultants in an

aggregate amount not to exceed $3,000 per year, (iv) make certain payments in connection with the Tax Receivable Agreement, and (v) make other dividends or distributions in an aggregate amount not to exceed 5% of the net cash proceeds received from any additional common equity issuance. The Company is also permitted to make non-cash dividends in the form of additional equity issuances. Each subsidiary may make ratable distributions to persons that own equity interests in such subsidiary. All other forms of dividends or distributions are prohibited under the Senior Secured Credit Facility.

2017 Senior Secured Credit Facility

On October 30, 2017, the Company replaced its then-existing credit facility with the 2017 Senior Secured Credit Facility (the “2017 Senior Secured Credit Facility”). The 2017 Senior Secured Credit Facility consisted of term loans in the original principal amount of $40,000 and a $110,000 revolving line of credit. The 2017 Senior Secured Credit Facility accrued interest, payable monthly, at the prime rate plus a margin of 0.50% to 2.00% or at the 30-day LIBOR rate plus a margin of 2.75% to 4.00%, in each case depending on the ratio of consolidated debt-to-EBITDA, as defined in the agreement. Additionally, the 2017 Senior Secured Credit Facility required the Company to pay unused commitment fees of up to 0.15% to 0.30% on any undrawn amounts under the revolving line of credit. The maturity date of the 2017 Senior Secured Credit Facility is October 30, 2022. Principal payments of $1,250 were due on the last day of each calendar quarter until the maturity date, when all outstanding principal and accrued and unpaid interest were due.

The 2017 Senior Secured Credit Facility was secured by substantially all assets of the Company. The lenders under the 2017 Senior Secured Credit Facility held senior rights to collateral and principal repayment over all other creditors.

As previously mentioned, on May 9, 2019, the Company replaced its existing 2017 Senior Secured Credit Facility with the Senior Secured Credit Facility.

Notes to Mezzanine Lenders

During 2013, the Company issued notes payable in the aggregate principal amount of $10,500 (the “Mezzanine Notes”) to three creditors. The Mezzanine Notes accrued interest at a fixed rate of 12.0%, payable monthly, and initially were due to mature in February 2018. In April 2016, the Mezzanine Notes were amended and restated and the maturity dates were extended to November 29, 2020, when all outstanding principal and accrued and unpaid interest was due. The amendment was accounted for as a modification under the guidance at ASC 470-50. The Mezzanine Notes were secured by substantially all assets of the Company in accordance with the terms of a security agreement and were subordinate to the Senior Secured Credit Facility.

The provisions of the Mezzanine Notes placed certain restrictions and limitations upon the Company. These included restrictions on additional borrowings, capital expenditures, maintenance of certain financial ratios, and certain non-financial covenants pertaining to the activities of the Company during the period covered. The Company was in compliance with such covenants as of September 30, 2017. The Mezzanine Lenders participated in the July 2017 Class A unit offerings (see Note 13).

In June 2018, all of the outstanding aggregate principal balance and accrued interest on the Mezzanine Notes was repaid with proceeds from the Company’s IPO. As part of the extinguishment of the Mezzanine Notes, $78 of unamortized debt issuance costs were written off.

Mezzanine Warrants

During 2013, the Company issued notes payable in the aggregate principal amount of $10,500 (the “Mezzanine Notes”) to three creditors. In June 2018, all of the outstanding aggregate principal balance and accrued interest on the Mezzanine Notes was repaid with proceeds from the Company’s IPO.

In connection with the issuance of the Mezzanine Notes, the Company granted the Mezzanine Warrants to purchase 1,423,688 common units in i3 Verticals, LLC. The Mezzanine Warrants were determined to have no

material value as of the grant date. The intrinsic value of the Mezzanine Warrants was $767 as of September 30, 2017, and they had an exercise price of $0.01. On June 25, 2018, in conjunction with the Reorganization Transactions described in Note 1, all existing Mezzanine Warrants were exercised for common units in i3 Verticals, LLC. The intrinsic value of the Mezzanine Warrants at that date was $9,241. The change in the fair market value of the warrants for the year ended September 30, 2018 is reflected within the consolidated statement of operations.

Unsecured notes payable to related and unrelated creditors

During 2014, the Company issued the Junior Subordinated Notes in the aggregate principal amount of $17,608 to unrelated and related creditors. The Junior Subordinated Notes accrued interest, payable monthly, at a fixed rate of 10.0% and were due to mature on February 14, 2019, when all outstanding principal and accrued and unpaid interest was due. However, the unsecured notes were subordinate to the Mezzanine Notes and the Senior Secured Credit Facility, which both had maturities beyond the Junior Subordinated Notes, and the provisions of the Mezzanine Notes and Senior Secured Credit Facility did not permit the payment of any subordinated debt prior to its maturity. Should the Junior Subordinated Notes have reached maturity and the terms of the Mezzanine Notes and Senior Secured Credit Facility remained in place, the term of the Junior Subordinated Notes would have been extended until after the maturity of the Mezzanine Notes and Senior Secured Credit Facility, in accordance with the terms of the Junior Subordinated Notes.

In connection with the issuance of the Junior Subordinated Notes, the Company granted detachable warrants (“Junior Subordinated Notes Warrants”) to purchase 1,433,920 common units in i3 Verticals, LLC. Management determined that the warrants had no material value as of the grant date, and none of the proceeds from the notes was attributed to the warrants. The warrants were accounted for as equity. See additional disclosures in Note 13.

In July 2017, $500 of the Junior Subordinated Notes were retired and exchanged for 148 Class A units of the Company. The fair value of the Class A units issued approximated the carrying amount of the Junior Subordinated Notes, so no extinguishment gain or loss was recognized. See additional disclosures in Note 13 and Note 15.

In June 2018, in connection with the Company's IPO and as part of the Reorganization Transactions, $8,054 of the Junior Subordinated Notes were converted to newly issued shares of the Company's Class A common stock, as described in Note 1, and the remaining $8,054 of the Junior Subordinated Notes was repaid with proceeds from the Company's IPO. As part of the extinguishment of the Junior Subordinated Notes, $43 of unamortized debt issuance costs were written off.

Debt issuance costs

During the year ended September 30, 2020, the Company capitalized $4,212 in connection with the issuance of the Exchangeable Notes, the Note Hedge Transactions and the Warrants and in connection with entering into the second amendment to the Senior Secured Credit Facility. During the year ended September 30, 2019, the Company incurred debt issuance costs totaling $1,245 in connection with the issuance of long-term debt. The debt issuance costs are being amortized over the related term of the debt using the effective interest rate method, and are presented net against long-term debt in the consolidated balance sheets. The amortization of debt issuance costs is included in interest expense and amounted to approximately $758, $721 and $1,072 during the years ended September 30, 2020, 2019 and 2018, respectively.

Income Taxes

12 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXESi3 Verticals, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from i3 Verticals, LLC based on i3 Verticals, Inc.'s economic interest in i3 Verticals, LLC. i3 Verticals, LLC's members, including the Company, are liable for federal, state and local income taxes based on their share of i3 Verticals, LLC's pass-through taxable income. i3 Verticals, LLC is not a taxable entity for federal income tax

purposes, but is subject to and reports entity level tax in both Tennessee and Texas. In addition, certain subsidiaries of i3 Verticals, LLC are corporations that are subject to state and federal income taxes.


	Year ended September 30,
	2020		2019		2018
Current:
Federal tax (benefit) expense	$	(34)	$	220	$	668
State tax expense	446		189		351
Deferred:
Federal tax benefit	(3,018)		(487)		(685)
State tax (benefit) expense	(189)		(99)		3
Income tax (benefit) expense	$	(2,795)	$	(177)	$	337

A reconciliation of income tax expense from operations computed at the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows:


	Year ended September 30,
	2020				2019				2018
Expected U.S. federal income taxes at statutory rate	$	(792)	21.0	%	$	81	21.0	%	$	(1,139)	24.6	%
Partnership income not taxed at federal level	85		(2.3)	%	(1,007)		(260.9)	%	294		(6.4)	%
Valuation allowance	(2,694)		71.4	%	251		65.0	%	965		(20.9)	%
State and local income taxes, net of federal benefit	244		(6.5)	%	104		26.9	%	295		(6.4)	%
Nondeductible expenses and other permanent items	496		(13.1)	%	582		150.8	%	66		(1.4)	%
Revaluation of debt and other debt transaction differences	222		(5.9)	%	(189)		(49.0)	%	332		(7.2)	%
Federal tax rate change	—		—	%	—		—	%	(471)		10.2	%
Change in liability for uncertain tax positions	108		(2.9)	%	—		—	%	—		—	%
Federal tax credits	(431)		11.4	%	—		—	%	—		—	%
Other	(33)		0.9	%	1		0.3	%	(5)		0.1	%
Income tax (benefit) expense	$	(2,795)	74.1	%	$	(177)	(45.9)	%	$	337	(7.3)	%

Deferred income taxes are provided for the temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities. Net deferred taxes spanning multiple jurisdictions as of September 30, 2020 and 2019 were as follows:


	September 30,
	2020		2019
Deferred tax assets:
Investment in partnership	$	47,897	$	40,880
Stock-based compensation	1187		811
Deferred revenue	525		564
Accrued expenses	181		110
Net operating loss carryforwards	10,969		6,360
Section 163j carryforward	2,498		2,006
Federal tax credits	901		—
Other	73		42
Gross deferred tax assets	64,231		50,773
Valuation allowance	(20,230)		(16,609)

Deferred tax liabilities:
Intangible assets	$	(9,167)	$	(6,257)
Other	(291)		(285)
Net deferred tax asset	$	34,543	$	27,622

Federal net operating loss carryforwards as of September 30, 2020 were $26,984 and federal tax credits were $901, resulting in a deferred tax benefit of $6,568. The federal net operating loss carryforwards will begin to expire in 2034 and the federal tax credits will begin to expire in 2033. The use of federal net operating losses and credits are limited to the future taxable income of separate legal entities. As a result, a valuation allowance of $388 has been provided for certain federal deferred tax assets, an increase of $383 during the year ended September 30, 2020. State net operating loss carryforwards as of September 30, 2020 totaled $81,827, resulting in a deferred tax benefit of $5,302. The state net operating loss carryforwards will begin to expire in 2024. The use of certain state net operating losses are limited to future taxable earnings of separate legal entities. As a result, a valuation allowance of $3,571 has been provided for state loss carryforwards, an increase of $1,094 during the year ended September 30, 2020. The Company also considered a valuation allowance on its $47,897 outside basis of investment in i3 Verticals, LLC deferred tax benefit as of September 30, 2020. The Company has recorded a valuation allowance of $16,271 against the portion of the deferred tax benefit that is capital in nature, resulting in an increase in valuation allowance of $2,143 during the year ended September 30, 2020. Management believes that it is more likely than not that the results of operations will generate sufficient taxable income to realize the deferred tax assets after giving consideration to the valuation allowance.

The components of the Company’s liability for uncertain tax benefits are as follows:


Gross unrecognized tax benefits as of September 30, 2019	$	—
Increase in current year tax positions	108
Increase in prior year tax positions	76
Gross unrecognized tax benefits as of September 30, 2020	$	184

As of September 30, 2020 and 2019, the Company had accrued interest of $7 and $0, respectively, and no accrued penalties in either period related to uncertain tax positions. It is the Company’s policy to recognize interest and/or penalties related to income tax matters in income tax expense. The Company is no longer subject to U.S. federal, state, or local examinations by tax authorities for years before 2016. As of September 30, 2020 and 2019, there were unrecognized tax benefits of $184 and $0 that if recognized would affect the annual effective tax rate.

On December 22, 2017, the Tax Cuts and Jobs Act was enacted into law. The legislation contains several key tax provisions, including the reduction of the federal corporate income tax rate to 21% effective January 1, 2018, as well as a variety of other changes, including limitation of the tax deductibility of interest expense, acceleration of expensing of certain business assets and reductions in the amount of executive pay that could qualify as a tax deduction. The SEC staff issued Staff Accounting Bulletin No. 118, which allowed the Company to record provisional amounts during a measurement period not to extend beyond one year after the enactment date. As of December 22, 2018, the Company completed its accounting for all of the enactment-date income tax effects of the Tax Cuts and Jobs Act. The Company made no material adjustments to the provisional amounts recorded.

Tax Receivable Agreement

On June 25, 2018, the Company entered into a Tax Receivable Agreement with i3 Verticals, LLC and each of the Continuing Equity Owners (the “Tax Receivable Agreement”) that provides for the payment by the Company to the Continuing Equity Owners of 85% of the amount of certain tax benefits, if any, that it actually realizes, or in some circumstances, is deemed to realize in its tax reporting, as a result of (i) future redemptions funded by the Company or exchanges, or deemed exchanges in certain circumstances, of Common Units of i3 Verticals, LLC for Class A common stock of i3 Verticals, Inc. or cash, and (ii) certain additional tax benefits attributable to payments made under the Tax Receivable Agreement. These tax benefit payments are not conditioned upon one or more of the Continuing Equity Owners maintaining a continued ownership interest in i3 Verticals, LLC. If a Continuing Equity Owner transfers Common Units but does not assign to the transferee of such units its rights under the Tax Receivable Agreement, such Continuing Equity Owner generally will continue to be entitled to receive payments under the Tax Receivable Agreement arising in respect of a subsequent exchange of such Common Units. In general, the Continuing Equity Owners’ rights under the Tax Receivable Agreement may not be assigned, sold, pledged or otherwise alienated to any person, other than certain permitted transferees, without (a) the Company's prior written consent, which should not be unreasonably withheld, conditioned or delayed, and (b) such persons becoming a party to the Tax Receivable Agreement and agreeing to succeed to the applicable Continuing Equity Owner’s interest therein. The Company expects to benefit from the remaining 15% of the tax benefits, if any, that the Company may realize.

During the year ended September 30, 2018, in conjunction with the Company's IPO, i3 Verticals, Inc. purchased Class B common stock from a Continuing Equity Owner for $4,635. This transaction triggered an increase in the tax basis of the Company's Common Units in i3 Verticals, LLC subject to the provisions of the Tax Receivable Agreement. The Company recognized a deferred tax asset in the amount of $960 and a corresponding liability of $816, representing 85% of the tax benefits due to the Continuing Equity Owners related to exchanges in the year ended September 30, 2018.

During the year ended September 30, 2019, the Company acquired an aggregate of 4,292,169 common units of i3 Verticals, LLC in connection with the redemption of common units, which resulted in an increase in the tax basis of our investment in i3 Verticals, LLC subject to the provisions of the Tax Receivable Agreement.

Primarily as a result of these exchanges, during the year ended September 30, 2019, the Company recognized an increase to its net deferred tax assets in the amount of $25,776, and corresponding Tax Receivable Agreement liabilities of $22,413, representing 85% of the tax benefits due to the Continuing Equity Owners. The results of these transactions brought the deferred tax asset and corresponding Tax Receivable Agreement liability balances to $26,736 and $23,229, respectively, as of September 30, 2019.

During the year ended September 30, 2020, the Company acquired an aggregate of 1,021,016 common units of i3 Verticals, LLC in connection with the redemption of common units, which resulted in an increase in the tax basis of our investment in i3 Verticals, LLC subject to the provisions of the Tax Receivable Agreement. As a result of these exchanges, during the year ended September 30, 2020, the Company recognized an increase to its net deferred tax assets in the amount of $6,307, and corresponding Tax Receivable Agreement liabilities of $5,361, representing 85% of the tax benefits due to the Continuing Equity Owners.

The deferred tax asset and corresponding Tax Receivable Agreement liability balances were $31,626 and $27,565, respectively, as of September 30, 2020.

Payments to the Continuing Equity Owners related to exchanges through September 30, 2020 will range from $0 to $2,460 per year and are expected to be paid over the next 25 years. The amounts recorded as of September 30, 2020, approximate the current estimate of expected tax savings and are subject to change after the filing of the Company’s U.S. federal and state income tax returns. Future payments under the Tax Receivable Agreement with respect to subsequent exchanges would be in addition to these amounts.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

Fair Value Measurements

12 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

The Company applies the provisions of ASC 820, Fair Value Measurement, which defines fair value, establishes a framework for its measurement and expands disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or the price paid to transfer a liability as of the measurement date. A three-tier, fair-value reporting hierarchy exists for disclosure of fair value measurements based on the observability of the inputs to the valuation of financial assets and liabilities. The three levels are:

Level 1 — Quoted prices for identical instruments in active markets.

Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in active exchange markets.

The carrying value of the Company’s financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, other assets, accounts payable, and accrued expenses, approximated their fair values as of September 30, 2020 and 2019, because of the relatively short maturity dates on these instruments. The carrying amount of debt approximates fair value as of September 30, 2020 and 2019, because interest rates on these instruments approximate market interest rates.

The Company has no Level 1 or Level 2 financial instruments measured at fair value on a recurring basis. The following tables present the changes in the Company's Level 3 financial instruments that are measured at fair value on a recurring basis.


	Accrued Contingent Consideration
Balance at September 30, 2018	$	5,999
Contingent consideration accrued at time of business combination	13,032
Change in fair value of contingent consideration included in Operating expenses	3,389
Contingent consideration paid	(4,194)
Balance at September 30, 2019	$	18,226

Contingent consideration accrued at time of business combination	4,748
Change in fair value of contingent consideration included in Operating expenses	(1,409)
Contingent consideration paid	(8,531)
Balance at September 30, 2020	$	13,034

The fair value of contingent consideration obligations includes inputs not observable in the market and thus represents a Level 3 measurement. The amount to be paid under these obligations is contingent upon the achievement of certain growth metrics related to the financial performance of the entities subsequent to acquisition. The fair value of material contingent consideration included in an acquisition is calculated using a Monte Carlo simulation. The contingent consideration is revalued each period until it is settled. Management reviews the historical and projected performance of each acquisition with contingent consideration and uses an income probability method to revalue the contingent consideration. The revaluation requires management to make certain assumptions and represent management's best estimate at the valuation date. The probabilities are determined based on a management review of the expected likelihood of triggering events that would cause a change in the contingent consideration paid. The Company develops the projected future financial results based on an analysis of historical results, market conditions, and the expected impact of anticipated changes in the Company's overall business and/or product strategies.

Approximately $10,062 and $10,223 of contingent consideration was recorded in accrued expenses and other current liabilities as of September 30, 2020 and 2019, respectively. Approximately $2,972 and $8,003 of contingent consideration was recorded in other long-term liabilities as of September 30, 2020 and 2019, respectively.

Disclosure of Fair Values

The Company's financial instruments that are not remeasured at fair value include the Exchangeable Notes (see Note 9). The Company estimates the fair value of the Exchangeable Notes through consideration of quoted market prices of similar instruments, classified as Level 2 as described above. The estimated fair value of the Exchangeable Notes was $102,064 as of September 30, 2020.

Share-based Payment Arrangement [Abstract]

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Equity-Based Compensation

12 Months Ended

Sep. 30, 2020

Equity-Based Compensation

EQUITY-BASED COMPENSATION

A summary of equity-based compensation expense recognized during the years ended September 30, 2020, 2019 and 2018 is as follows:


	Year ended September 30,
	2020		2019		2018
TRA non-participation compensatory shares	$	—	$	—	$	741
Stock options	10,452		6,124		826
Equity-based compensation expense	$	10,452	$	6,124	$	1,567

Amounts are included in general and administrative expense on the consolidated statements of operations. Income tax benefits of $604 and $160 were recognized related to equity-based compensation during the years ended September 30, 2020 and 2019, respectively. No income tax benefits were recognized related to equity-based compensation during the year ended September 30, 2018.

TRA Non-Participation Compensatory Shares

On June 25, 2018, the Company entered into the Tax Receivable Agreement as described in Note 10. The Former Equity Owners did not participate in the Tax Receivable Agreement. Therefore, as part of the Reorganization Transactions, the Class B common units held by the Former Equity Owners were converted into shares of Class A common stock based on a conversion ratio that provided an equitable adjustment to reflect the full value of the Class B common units. For employees who are Former Equity Owners, this arrangement was a modification under ASC 718. The Company recognized stock-based compensation expense of $741 as part of the Reorganization Transactions as a result of this conversion.

Stock Options

In May 2018, the Company adopted the 2018 Equity Incentive Plan (the “2018 Plan”) under which the Company may grant up to 3,500,000 stock options and other equity-based awards to employees, directors and officers. The number of shares of Class A common stock available for issuance under the 2018 Plan includes an annual increase on the first day of each year, beginning with the 2019 calendar year, equal to 4.0% of the outstanding shares of all classes of the Company's common stock as of the last day of the immediately preceding calendar year, unless the Company’s board of directors determines prior to the last trading day of December of the immediately preceding calendar year that the increase shall be less than 4%. As of September 30, 2020, there were 205,151 options available to grant under the 2018 Plan.

The fair value of stock option awards during the years ended September 30, 2020, and 2019, and from June 20, 2018 through September 30, 2018 was determined on the grant date using the Black-Scholes valuation model based on the following weighted-average assumptions:


	September 30, 2020		September 30, 2019
Expected volatility(1)	28.5	%	26.7	%
Expected dividend yield(2)	—	%	—	%
Expected term(3)	6 years		6 years
Risk-free interest rate(4)	1.2	%	2.5	%

_________________

1.Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term.

2.The Company has assumed a dividend yield of zero as management has no plans to declare dividends in the foreseeable future.

3.Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method as details of employee exercise behavior are limited due to limited historical data.

4.The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term.

A summary of stock option activity for the year ended September 30, 2020 is as follows:


	Stock Options	Weighted Average Exercise Price
Outstanding at beginning of period	4,240,695	$	18.33
Granted	1,438,900	30.37
Exercised	(331,141)	15.85
Forfeited	(137,888)	21.56
Outstanding at end of period	5,210,566	$	21.73

The weighted-average grant date fair value of stock options granted during the year ended September 30, 2020 was $9.07. As of September 30, 2020, there were 5,210,566 stock options outstanding, of which 1,686,957 were exercisable. As of September 30, 2020, total unrecognized compensation expense related to unvested stock options, including an estimate for pre-vesting forfeitures, was $18,620, which is expected to be recognized over a weighted-average period of 1.9 years. The Company's policy is to account for forfeitures of stock-based compensation awards as the occur. The total fair value of stock options that vested during the year ended September 30, 2020 was $8,100.

Stockholders' / Members' Equity and Redeemable Class A Units

12 Months Ended

Sep. 30, 2020

Equity [Abstract]

Stockholders' / Members' Equity and Redeemable Class A Units

STOCKHOLDERS' / MEMBERS' EQUITY AND REDEEMABLE CLASS A UNITS

In connection with the Company’s IPO, the Company’s board of directors approved an amended and restated certificate of incorporation (the “Amended and Restated Certificate of Incorporation”), which became effective on June 25, 2018. The Amended and Restated Certificate of Incorporation authorizes the issuance of up to 150,000,000 shares of Class A common stock, up to 40,000,000 shares of Class B common stock and 10,000,000 shares of preferred stock, each having a par value of $0.0001 per share. Shares of Class A common stock have both economic and voting rights. Shares of Class B common stock have no economic rights, but do have voting rights. Holders of shares of Class A common stock and Class B common stock are entitled to one vote per share on all matters presented to stockholders generally. The Company’s board of directors has the discretion to determine the rights, preferences, privileges, and restrictions of any series of preferred stock.

On June 25, 2018, the Company completed the IPO of 7,647,500 shares of its Class A common stock. In connection with the IPO, the Company and i3 Verticals, LLC completed the Reorganization Transactions, pursuant to which all outstanding vested and non-vested Class A units, Class P units and common units were converted into new Common Units. Former Equity Owners' Common Units were converted into newly issued shares of Class A common stock. Continuing Equity Owners received newly issued shares of Class B common stock. For further descriptions of the IPO and Reorganization Transactions, see Note 1.

i3 Verticals, LLC Recapitalization

As noted above, the i3 Verticals, LLC Limited Liability Company Agreement, among other things, appointed the Company as i3 Verticals, LLC’s sole managing member and reclassified all outstanding membership interests in i3 Verticals, LLC as non-voting common units. As the sole managing member of i3 Verticals, LLC, the Company controls the management of i3 Verticals, LLC. As a result, the Company consolidates i3 Verticals, LLC’s financial results and reports a non-controlling interest related to the economic interest of i3 Verticals, LLC held by the Continuing Equity Owners.

The Amended and Restated Certificate of Incorporation and the i3 Verticals, LLC Limited Liability Company Agreement discussed above require i3 Verticals, LLC and the Company, at all times, to maintain (i) a one-to-one ratio between the number of shares of Class A common stock issued by the Company and the number of Common Units owned by the Company and (ii) a one-to-one ratio between the number of shares of Class B common stock owned by the Continuing Equity Owners and the number of Common Units owned by the Continuing Equity Owners (other than shares of the Company's Class A common stock under unvested options

the Company issues, treasury stock and preferred stock (the “Excluded Common Units”)). The Company may issue shares of Class B common stock only to the extent necessary to maintain the one-to-one ratio between the number of Common Units of i3 Verticals, LLC held by the Continuing Equity Owners (other than the Excluded Common Units) and the number of shares of Class B common stock issued to the Continuing Equity Owners. Shares of Class B common stock are transferable only together with an equal number of Common Units of i3 Verticals, LLC. Only permitted transferees of Common Units held by the Continuing Equity Owners will be permitted transferees of Class B common stock.

The Continuing Equity Owners may from time to time at each of their options (subject, in certain circumstances, to time-based vesting requirements) require i3 Verticals, LLC to redeem all or a portion of their Common Units in exchange for, at i3 Verticals, LLC’s election, newly-issued shares of our Class A common stock on a one-for-one basis or a cash payment equal to a volume weighted average market price of one share of Class A common stock for each Common Unit redeemed, in each case in accordance with the terms of the i3 Verticals, LLC Limited Liability Company Agreement; provided that, at the Company’s election, the Company may effect a direct exchange of such Class A common stock or such cash, as applicable, for such Common Units. The Continuing Equity Owners may exercise such redemption right for as long as their Common Units remain outstanding. Simultaneously with the payment of cash or shares of Class A common stock, as applicable, in connection with a redemption or exchange of Common Units pursuant to the terms of the i3 Verticals, LLC Limited Liability Company Agreement, a number of shares of the Company's Class B common stock registered in the name of the redeeming or exchanging Continuing Equity Owner will be canceled for no consideration on a one-for-one basis with the number of Common Units so redeemed or exchanged.

Redeemable Class A Units

Prior to the Company's recapitalization, as of September 30, 2017, there were 4,900,000 redeemable Class A units issued and outstanding. Upon receipt of a redemption request following the termination of employment of the current Chief Executive Officer of the Company (the redemption event), the Company was required to redeem all of the outstanding redeemable Class A units held by certain members. The redemption price of the redeemable Class A units was equal to the greater of (i) the fair value of the redeemable Class A unit or (ii) original issue price per redeemable Class A unit plus any preferred returns through the date of the redemption request.

Holders of redeemable Class A units had preferred return rights in preference to any declaration or distribution to holders of Class P units or common units, and equal to other Class A units. Preferred returns on the redeemable Class A units accrued at an amount equal to 10.0% per unit per annum of the original issue price, compounded annually, whether or not declared by the board of directors, and were cumulative. After preferential payment to the holder of redeemable Class A units and other Class A units, any additional distributions declared were distributed pro-rata to the holders of Class A units, common units and Class P units, in proportion to their respective units. Total cumulative preferred returns included within the carrying amount of the redeemable Class A units amounted to $3,376 and $2,823 as of June 25, 2018, the date of the Reorganization Transactions, and September 30, 2017, respectively.

During 2017, as obligated under the provisions of its member agreements, the Company declared distributions of approximately $131 to its redeemable Class A unit holders in connection with the members’ estimated tax liabilities.

As described in Note 1, the redeemable Class A units were converted into Common Units in i3 Verticals, LLC in connection with the Reorganization Transactions.

Class A Units, Class P Units and Common Units

Prior to the Company's recapitalization, as of September 30, 2017, the Company had authorized the issuance of Class A units, Class P units and common units. As described in Note 1, the Class A units, Class P units and Common Units were converted to Common Units in i3 Verticals, LLC in connection with the Reorganization Transactions.

Class A Units

As of September 30, 2017, there were 13,892,129 Class A units issued and outstanding.

Holders of Class A units had preferred return rights in preference to any declaration or distribution to holders of Class P units or common units. Preferred returns on the Class A units accrued at an amount equal to 10.0% per unit per annum of the original issue price, compounded annually, whether or not declared by the board of directors, and were cumulative. After preferential payment to the holder of Class A units, any additional distributions declared were distributed pro-rata to the holders of Class A units, common units and Class P units, in proportion to their respective units. Total cumulative preferred returns included within the carrying amount of the Class A units amounted to $7,627 and $5,105 as of June 25, 2018, the date of the Reorganization Transactions, and September 30, 2017, respectively.

During 2017, as obligated under the provisions of its member agreements, the Company declared distributions of approximately $625 to its Class A unit holders in connection with the members’ estimated tax liabilities.

Common Units

As of September 30, 2017, there were 1,548,722 common units issued and outstanding. Common units were generally issued in association with acquisitions.

Junior Subordinated Notes Warrants

As of September 30, 2017, there were in the aggregate 1,433,920 warrants outstanding and exercisable to purchase common units which are classified as equity instruments. The warrants were issued in connection with the issuance of the Junior Subordinated Notes (Note 9). As of September 30, 2017, the intrinsic value of the junior subordinated warrants was $0.

Warrants

Expiration

Exercise Price

Junior Subordinated Notes Warrants

1,433,920

February 14, 2024

2.095

The Junior Subordinated Notes Warrants were issued at zero value and were reflected within members’ equity within the accompanying Consolidated Balance Sheets. On June 25, 2018, in conjunction with the Reorganization Transactions described in Note 1, all existing Junior Subordinated Notes Warrants were exercised for common units in i3 Verticals, LLC.

Mezzanine Warrants

As of September 30, 2017, there were in the aggregate 1,423,688 warrants outstanding and exercisable to purchase Common Units which are classified as long-term liabilities. The warrants were issued in connection with the issuance of the Mezzanine Notes. See additional disclosures in Note 9.

Restricted Class P Units

As of September 30, 2017, there were 7,647,350 restricted Class P units issued and outstanding to certain members of the Company's Board of Directors and employees.

All Class P units were issued at a participation threshold above the valuation of the Company at the grant date. As a result, they had a nominal value, individually and in the aggregate, at the grant date. Using an option-pricing model and considering liquidation preferences of the Class P units, as well as the lack of marketability, management determined that any compensation expense related to the restricted units was immaterial to the consolidated financial statements.

Commitments and Contingencies

12 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

Leases

The Company utilizes office space and equipment under operating leases. Rent expense under these leases amounted to $2,820, $2,302 and $1,555 during the years ended September 30, 2020, 2019 and 2018, respectively.

A summary of approximate future minimum payments under these leases as of September 30, 2020 is as follows:


Years ending September 30:
2021	$	2,726
2022	2,397
2023	2,096
2024	1,469
2025	968
Thereafter	1,221
Total	$	10,877

Minimum Processing Commitments

The Company has non-exclusive agreements with several processors to provide its services related to transaction processing and transmittal, transaction authorization and data capture, and access to various reporting tools. Certain of these agreements require the Company to submit a minimum monthly number of transactions for processing. If the Company submits a number of transactions that is lower than the minimum, it is required to pay to the processor the fees it would have received if it had submitted the required minimum number of transactions. As of September 30, 2020, such minimum fee commitments were as follows:


Years ending September 30:
2021	$	3,334
2022	2,818
2023	2,645
2024	450
2025	—
Thereafter	—
Total	$	9,247

Loan to Third Party Sales Organization

The Company has entered into an agreement as of March 2020, as amended in October 2020, to provide a secured loan to a third party sales organization of up to $3,500 in the future, dependent on their achievement of certain financial metrics. Additionally, the Company has conditionally committed to a future buyout of the third party's business at the earlier of (a) the 60th day following the date upon which the founder of the third party sales organization dies or becomes disabled or (b) the 60th day following July 1, 2023. The buyout amount is dependent on certain financial metrics but is capped at $29,000, which would be net of repayment of the secured loans. The buyout also contains certain provisions to provide additional consideration of up to $9,000, in the aggregate, to be paid based on the achievement of specified financial performance targets, following the buyout. As the eventual financial metrics are not known, the amount of the buyout transaction as well as the additional consideration are not able to be estimated at this time.

As of September 30, 2020, such knowable loan commitments, dependent on the third party sales organization's achievement of certain financial metrics, were $3,500 for fiscal year 2021.

Litigation

With respect to all legal, regulatory and governmental proceedings, and in accordance with ASC 450-20, Contingencies—Loss Contingencies, the Company considers the likelihood of a negative outcome. If the Company determines the likelihood of a negative outcome with respect to any such matter is probable and the amount of the loss can be reasonably estimated, the Company records an accrual for the estimated amount of loss for the expected outcome of the matter. If the likelihood of a negative outcome with respect to material matters is reasonably possible and the Company is able to determine an estimate of the amount of possible loss or a range of loss, whether in excess of a related accrued liability or where there is no accrued liability, the Company discloses the estimate of the amount of possible loss or range of loss. However, the Company in some instances may be unable to estimate an amount of possible loss or range of loss based on the significant uncertainties involved in, or the preliminary nature of, the matter, and in these instances the Company will disclose the nature of the contingency and describe why the Company is unable to determine an estimate of possible loss or range of loss.

In addition, the Company is involved in ordinary course legal proceedings, which include all claims, lawsuits, investigations and proceedings, including unasserted claims, which are probable of being asserted, arising in the ordinary course of business and otherwise not described below. The Company has considered all such ordinary course legal proceedings in formulating its disclosures and assessments. After taking into consideration the evaluation of such legal matters by the Company's legal counsel, the Company's management believes at this time such matters will not have a material impact on the Company's consolidated balance sheet, results of operations or cash flows.

Other

The Company's subsidiary CP-PS, LLC has certain indemnification obligations in favor of FDS Holdings, Inc. related to the acquisition of certain assets of Merchant Processing Solutions, LLC in February 2014. The Company has incurred expenses related to these indemnification obligations in prior periods and may have additional expenses in the future. However, after taking into consideration the evaluation of such matters by the Company’s legal counsel, the Company’s management believes at this time that the anticipated outcome of any existing or potential indemnification liabilities related to this matter will not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

Related Party Transactions	12 Months Ended
Related Party Transactions	Sep. 30, 2020
Related Party Transactions [Abstract]
Related Party Transactions	RELATED PARTY TRANSACTIONS Related parties held $6,158 of the Company’s Junior Subordinated Notes as of September 30, 2017. As described Note 9, in connection with the Company's IPO and as part of the Reorganization Transactions, $924 of the Junior Subordinated Notes held by related parties was converted to newly issued shares of the Company's Class A common stock. Also in June 2018, the remaining $5,234 of the Junior Subordinated Notes held by related parties were repaid with proceeds from the Company's IPO. Interest expense to related parties for the Company’s Junior Subordinated Notes amounted to $457 during the year ended September 30, 2018. All lenders party to the Company’s Mezzanine Notes are considered related parties, through their ownership interest in the Company and affiliated director relationships. Outstanding Mezzanine Notes payable to related parties amounted to $10,500 as of September 30, 2017. In June 2018, the Mezzanine Notes were repaid in full with proceeds from the Company's IPO. Interest expense to related parties for the Company’s Mezzanine Notes amounted to $952 during the year ended September 30, 2018. In April 2016, the Company entered into a purchase agreement to purchase certain assets of Axia, LLC. On April 29, 2016, the Company entered into a Processing Services Agreement (the “AxiaMed Agreement”) with Axia Technologies, LLC (which has since been incorporated as Axia Technologies, Inc., doing business as AxiaMed (“AxiaMed”)), an entity controlled by the previous owner of Axia, LLC. Under the AxiaMed Agreement, the Company agreed to provide processing services for certain merchants as designated by AxiaMed from time to time. In accordance with ASC 606, revenue from the processing services is recognized net of interchange, residual expense and other fees. The Company earned net revenues related to the AxiaMed Agreement of $95, $81 and $53 during the years ended September 30, 2020, 2019 and 2018 respectively. i3 Verticals, LLC, the Company's CEO and Clay Whitson, the Company's CFO, own 2.0%, 10.5% and 0.4%, respectively, of the outstanding equity of Axia Tech. In connection with our IPO, we entered into a Tax Receivable Agreement with certain non-controlling interest holders that provides for the payment by the Company to the Continuing Equity Owners of 85% of the amount of certain tax benefits, if any, that it actually realizes, or in some circumstances, is deemed to realize in its tax reporting, as a result of (i) future redemptions funded by the Company or exchanges, or deemed exchanges in certain circumstances, of Common Units of i3 Verticals, LLC for Class A common stock of i3 Verticals, Inc. or cash, and (ii) certain additional tax benefits attributable to payments made under the Tax Receivable Agreement. See Note 10 for further information. As of September 30, 2020, the total amount due under the Tax Receivable Agreement was $27,565.

Segments

12 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Segments

SEGMENTS

The Company determines its operating segments based on ASC 280, Segment Reporting, how the chief operating decision making group monitors and manages the performance of the business and the level at which financial information is reviewed. The Company’s operating segments are strategic business units that offer different products and services.

The Company's core business is delivering seamless integrated payment and software solutions to SMBs and organizations in strategic vertical markets. This is accomplished through the Merchant Services and Proprietary Software and Payments segments.

The Merchant Services segment provides comprehensive payment solutions to businesses and organizations. The Merchant Services segment includes third-party integrated payment solutions as well as merchant of record payment services across the Company's strategic vertical markets.

The Proprietary Software and Payments segment delivers solutions, including embedded payments, to the Company's clients through company-owned software. Payments are delivered through both the payment facilitator model and the traditional merchant processing model.

The Other category includes corporate overhead expenses, when presenting reportable segment information.

Effective July 1, 2020, the Company reassigned a component from the Proprietary Software and Payments segment to the Merchant Services segment to better align the Company's segments with its business operations.

The prior period comparatives reflected in the tables below have been retroactively adjusted to reflect the Company's current segment presentation.

The Company primarily uses processing margin to measure operating performance. The following is a summary of reportable segment operating performance for the years ended September 30, 2020, 2019 and 2018.


	As of and for the Year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

Operating expenses
Other costs of services	43,940		5,057		(1,767)		47,230
Selling general and administrative	26,376		28,187		23,760		78,323
Depreciation and amortization	11,796		5,723		698		18,217
Change in fair value of contingent consideration	(4,691)		3,282		—		(1,409)
Income (loss) from operations	$	23,528	$	8,704	$	(24,459)	$	7,773

Processing margin(1)	$	78,627	$	46,483	$	(1,758)	$	123,352
Total assets	$	206,769	$	139,107	$	57,650	$	403,526
Goodwill	$	115,982	$	71,023	$	—	$	187,005

__________________________

1.Processing margin is equal to revenue less other costs of services. $21,618, $587 and $(1,757) of residual expense, a component of other costs of services, are added back to the Merchant Services segment, Proprietary Software and Payments segment, and Other category, respectively.


	As of and for the Year ended September 30, 2019
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue	$	338,968	$	37,339	$	—	$	376,307

Operating expenses
Interchange and network fees	236,170		6,697		—		242,867
Other costs of services	41,487		2,750		—		44,237
Selling general and administrative	27,275		17,059		18,526		62,860
Depreciation and amortization	12,221		3,790		553		16,564
Change in fair value of contingent consideration	(477)		3,866		—		3,389
Income (loss) from operations	$	22,292	$	3,177	$	(19,079)	$	6,390

Processing margin(1)	$	78,369	$	28,497	$	—	$	106,866
Total assets	$	216,420	$	99,420	$	33,462	$	349,302
Goodwill	$	117,334	$	50,950	$	—	$	168,284

__________________________

1.Processing margin is equal to revenue less interchange and network fees, less other costs of services. $17,058, $605 and $0 of residual expense, a component of other costs of services, are added back to the Merchant Services segment, Proprietary Software and Payments segment, and Other category, respectively.


	As of and for the Year ended September 30, 2018
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue	$	303,692	$	19,819	$	(3)	$	323,508

Operating expenses
Interchange and network fees	209,705		4,838		—		214,543
Other costs of services	38,563		1,752		(1)		40,314
Selling general and administrative	23,716		7,177		9,692		40,585
Depreciation and amortization	9,736		1,896		207		11,839
Change in fair value of contingent consideration	2,103		1,763		—		3,866
Income (loss) from operations	$	19,869	$	2,393	$	(9,901)	$	12,361

Processing margin(1)	$	69,449	$	13,733	$	(2)	$	83,180
Total assets	$	143,792	$	26,524	$	4,826	$	175,142
Goodwill	$	70,936	$	13,018	$	—	$	83,954

__________________________

1.Processing margin is equal to revenue less interchange and network fees, less other costs of services. $14,025, $504 and $0 of residual expense, a component of other costs of services, are added back to the Merchant Services segment, Proprietary Software and Payments segment, and Other category, respectively.

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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Cash Flow, Noncash Investing and Financing Activities Disclosure [Abstract]

Non-Controlling Interest

12 Months Ended

Sep. 30, 2020

Noncontrolling Interest [Abstract]

Non-Controlling Interest

NON-CONTROLLING INTEREST

i3 Verticals, Inc. is the sole managing member of i3 Verticals, LLC and as a result, consolidates the financial results of i3 Verticals, LLC and reports a non-controlling interest representing the Common Units of i3 Verticals, LLC held by the Continuing Equity Owners. Changes in i3 Verticals, Inc.’s ownership interest in i3 Verticals, LLC while i3 Verticals, Inc. retains its controlling interest in i3 Verticals, LLC will be accounted for as equity transactions. As such, future redemptions or direct exchanges of Common Units of i3 Verticals, LLC by the Continuing Equity Owners will result in a change in ownership and reduce or increase the amount recorded as non-controlling interest and increase or decrease additional paid-in capital when i3 Verticals, LLC has positive or negative net assets, respectively.

As of September 30, 2020, and 2019, respectively, i3 Verticals, Inc. owned 18,864,143 and 14,444,115 of i3 Verticals, LLC's Common Units, representing a 61.3% and 52.8% economic ownership interest in i3 Verticals, LLC.

The following table summarizes the impact on equity due to changes in the Company's ownership interest in i3 Verticals, LLC:


	Year ended September 30,
	2020		2019		2018
Net (loss) income attributable to non-controlling interest	$	(560)	$	3,608	$	1,937
Transfers to (from) non-controlling interests:
Allocation of equity to non-controlling interests arising from the reorganization transactions and IPO	—		—		70,960
Distributions to non-controlling interest holders	(3)		(2,060)		—
Redemption of common units in i3 Verticals, LLC	(5,080)		(12,077)		—
Adjustment related to prior periods	2,730		—		—
Cumulative effect of adoption of new accounting standard	640		—		—
Allocation of equity to non-controlling interests	24,495		—		—
Net transfers to (from) non-controlling interests	22,782		(14,137)		70,960
Change from net income attributable to non-controlling interests and transfers to (from) non-controlling interests	$	22,222	$	(10,529)	$	72,897

During the year ended September 30, 2020, the Company corrected for immaterial misstatements of equity between the Company and non-controlling interest related to its June 2019 Secondary Public Offering by increasing non-controlling interest and reducing additional paid-in capital. This adjustment related to immaterial errors associated with the ownership percentage change used in the underlying calculation giving effect to the offering.

Earnings Per Share

12 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Earnings Per Share

EARNINGS PER SHARE

Basic earnings per share of Class A common stock is computed by dividing net income available to i3 Verticals, Inc. by the weighted-average number of shares of Class A common stock outstanding during the period. Diluted earnings per share of Class A common stock is computed by dividing net income available to i3 Verticals, Inc. by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities.

Prior to the IPO, the i3 Verticals, LLC membership structure included Class A units, common units and Class P units. The Company analyzed the calculation of earnings per unit for periods prior to the IPO using the two-class method and determined that it resulted in values that would not be meaningful to the users of these consolidated financial statements. Therefore, earnings per share information for the year ended September 30, 2018 represents only the period from June 25, 2018 through September 30, 2018.

The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock:


	Year ended September 30,
	2020		2019		2018
Basic net (loss) income per share:
Numerator
Net (loss) income(1)	$	(979)	$	563	$	2,673
Less: Net (loss) income attributable to non-controlling interests	(560)		3,608		1,937
Net (loss) income attributable to Class A common stockholders	$	(419)	$	(3,045)	$	736
Denominator
Weighted average shares of Class A common stock outstanding(2)	14,833,378		10,490,981		8,812,630
Basic net (loss) income per share(3)	$	(0.03)	$	(0.29)	$	0.08

Dilutive net (loss) income per share(3):
Numerator
Net (loss) income attributable to Class A common stockholders	$	(419)			$	736
Reallocation of net (loss) income assuming conversion of common units(5)	(422)				1,464
Net (loss) income attributable to Class A common stockholders - diluted	$	(841)			$	2,200
Denominator
Weighted average shares of Class A common stock outstanding(2)(4)	14,833,378				8,812,630
Weighted average effect of dilutive securities	12,596,423				18,061,248
Weighted average shares of Class A common stock outstanding - diluted	27,429,801				26,873,878
Diluted net (loss) income per share	$	(0.03)			$	0.08

____________________

1.Basic and diluted earnings per Class A common stock is presented only for the period after the Company’s Reorganization Transactions. As such, net income used in the calculation for the year ended September 30, 2018 represents the net income attributable to Class A common stockholders for the period from June 25, 2018 through September 30, 2018.

2.Excludes 204,969, 282,801 and 299,412 shares of restricted Class A common stock for the years ended September 30, 2020, 2019 and 2018, respectively.

3.For the year ended September 30, 2019, all potentially dilutive securities were anti-dilutive, so diluted net loss per share was equivalent to basic net loss per share. The following securities were excluded from the weighted average effect of dilutive securities in the computation of diluted earnings per share of Class A common stock:

a.15,856,855 shares of weighted average Class B common stock for the year ended September 30, 2019, along with the reallocation of net income assuming conversion of these shares, were excluded because the effect would have been anti-dilutive,

b.626,500 options to purchase shares of Class A common stock for the year ended September 30, 2019, were excluded because the exercise price of these options exceeded the average market price of our Class A common stock during the period (“out-of-the-money”) and the effect of including them would have been anti-dilutive, and

c.1,009,858 shares of Class A common stock for the year ended September 30, 2019, resulting from estimated stock option exercises as calculated by the treasury stock method, and 282,801 shares of restricted Class A common stock for the year ended September 30, 2019 were excluded because the effect of including them would have been anti-dilutive.

4.For the year ended September 30, 2020, the following securities were excluded from the weighted average effect of dilutive securities in the computation of diluted earnings per share of Class A common stock:

a.1,327,500 options to purchase shares of Class A common stock for the year ended September 30, 2020, were excluded because the exercise price of these options exceeded the average market price of our Class A common stock during the period (“out-of-the-money”) and the effect of including them would have been anti-dilutive, and

b.1,179,538 shares of Class A common stock for the year ended September 30, 2020, resulting from estimated stock option exercises as calculated by the treasury stock method, and 204,969 shares of restricted Class A common stock for the year ended September 30, 2020 were excluded because the effect of including them would have been anti-dilutive.

5.The reallocation of net income assuming conversion of common units represents the tax effected net income attributable to non-controlling interest using the effective income tax rates described in Note 10 above and assuming all common units of i3 Verticals, LLC were exchanged for Class A common stock at the beginning of the year. The common units of i3 Verticals, LLC held by the Continuing Equity Owners are potentially dilutive securities, and the computations of pro forma diluted net income per share assume that all common units of i3 Verticals, LLC were exchanged for shares of Class A common stock at the beginning of the year.

Since the Company expects to settle the principal amount of its outstanding Exchangeable Notes in cash and any excess in cash or shares of the Company's Class A common stock, the Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share of common stock when the average market price of the Company's Class A common stock for a given period exceeds the exchange price of $40.87 per share for the Exchangeable Notes.

The Warrants sold in connection with the issuance of the Exchangeable Notes are considered to be dilutive when the average price of the Company's Class A common stock during the period exceeds the Warrants' stock price of $62.88 per share. The effect of the additional shares that may be issued upon exercise of the Warrants will be included in the weighted average shares of Class A common stock outstanding—diluted using the treasury stock method. The Note Hedge Transactions purchased in connection with the issuance of the Exchangeable Notes are considered to be anti-dilutive and therefore do not impact our calculation of diluted net income per share. Refer to Note 9 for further discussion regarding the Exchangeable Notes.

Shares of the Company's Class B common stock do not participate in the earnings or losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted earnings per share of Class B common stock under the two-class method has not been presented.

Significant Non-cash Transactions

12 Months Ended

Sep. 30, 2020

Significant Non-cash Transactions

SIGNIFICANT NON-CASH TRANSACTIONS

The Company engaged in the following significant non-cash investing and financing activities during the years ended September 30, 2020, 2019, and 2018:


	Year ended September 30,
	2020		2019		2018
Common Units issued as part of acquisitions' purchase consideration (Note 4)	$	—	$	—	$	104
Restricted Class A common stock issued as part of acquisitions' purchase consideration (Note 4)	$	—	$	225	$	550
Acquisition date fair value of contingent consideration in connection with business combinations	$	4,748	$	13,032	$	2,084
Replacement of the 2016 Senior Secured Credit Facility with the 2017 Senior Secured Credit Facility	$	—	$	—	$	87,525
Replacement of the 2017 Senior Secured Credit Facility with the Senior Secured Credit Facility	$	—	$	100,229	$	—
Mezzanine Notes net settled with Mezzanine Warrant exercises	$	—	$	—	$	14
Unsecured notes payable to related and unrelated creditors net settled with Junior Subordinated Notes Warrants	$	—	$	—	$	2,565
Settlement of warrant liability with equity as a result of Mezzanine Warrant exercise	$	—	$	—	$	9,253
Preferred return on Redeemable Class A Units	$	—	$	—	$	552
Preferred return on Class A Units	$	—	$	—	$	2,522
Debt issuance costs financed with proceeds from the 2017 Senior Secured Credit Facility	$	—	$	—	$	904
Debt issuance costs and accrued interest financed with proceeds from the 2019 Senior Secured Credit Facility	$	—	$	1,271	$	—
Conversion of notes payable to related and unrelated creditors to Class A common stock	$	—	$	—	$	8,054

Quarterly Information (Unaudited)

12 Months Ended

Sep. 30, 2020

Quarterly Financial Information Disclosure [Abstract]

Quarterly Information (Unaudited)

QUARTERLY INFORMATION (UNAUDITED)

The tables below present summarized unaudited quarterly results of operations for the years ended September 30, 2020 and 2019. Management believes that all necessary adjustments have been included in the amounts stated below for a fair presentation of the results of operations for the periods presented when read in conjunction with the consolidated financial statements for the years ended September 30, 2020 and 2019. Results of operations for a particular quarter are not necessarily indicative of results of operations for an annual period and are not predictive of future periods.


	Quarter ended
	December 31,		March 31,		June 30,		September 30,
Fiscal Year 2019:
Revenue	$	84,868	$	85,394	$	97,483	$	108,562
Income (loss) from operations	$	3,530	$	(203)	$	1,194	$	1,869
Income (loss) before income taxes	$	2,616	$	(1,358)	$	(724)	$	(148)
Net income (loss) attributable to i3 Verticals, Inc.	$	178	$	(1,102)	$	(1,191)	$	(930)
Basic earnings (loss) per share attributable to i3 Verticals, Inc.(1)	$	0.02	$	(0.12)	$	(0.12)	$	(0.07)
Diluted earnings (loss) per share attributable to i3 Verticals, Inc.(2)(4)	$	0.02	$	(0.12)	$	(0.12)	$	(0.07)
Fiscal Year 2020:
Revenue	$	41,111	$	39,178	$	31,573	$	38,272
Income from operations	$	4,097	$	2,041	$	437	$	1,198
Income (loss) before income taxes	$	2,083	$	(143)	$	(2,815)	$	(2,899)
Net (loss) income attributable to i3 Verticals, Inc.	$	(149)	$	737	$	(356)	$	(651)
Basic (loss) earnings per share attributable to i3 Verticals, Inc.(1)	$	(0.01)	$	0.05	$	(0.02)	$	(0.04)
Diluted (loss) earnings per share attributable to i3 Verticals, Inc.(3)(4)	$	(0.01)	$	0.05	$	(0.02)	$	(0.06)

____________________

1.Basic (loss) earnings per share excludes 295,405, 277,758, 285,433 and 271,881 shares of restricted Class A common stock from the calculation for the quarters ended December 31, 2018, March 31, 2019, June 30, 2019, and September 30, 2019, respectively, and 232,828, 215,564, 193,709 and 94,577 shares of restricted Class A common stock from the calculation for the quarters ended December 31, 2019, March 31, 2020, June 30, 2020, and September 30, 2020, respectively.

2.For the quarters ended December 31, 2018, and March 31, June 30, and September 30, 2019, the following securities were excluded from the weighted average effect of dilutive securities in the computation of diluted earnings per share of Class A common stock:

a.17,213,806, 17,112,164, 16,184,026 and 12,921,637 shares of weighted average Class B common stock for the quarters ended December 31, 2018, and March 31, June 30, and September 30, 2019, respectively, along with the reallocation of net income assuming conversion of these shares, were excluded from the calculation of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive,

b.754,750, 30,500, 443,000 and 446,000 options to purchase shares of Class A common stock for the quarters ended December 31, 2018, and March 31, June 30, and September 30, 2019, respectively, were excluded because the exercise price of these options exceeded the average market price of our Class A common stock during the period (“out-of-the-money”) and the effect of including them would have been anti-dilutive, and

c.1,012,916, 1,188,987 and 1,131,760 shares of Class A common stock for the quarters ended March 31, June 30, and September 30, 2019, respectively, resulting from estimated stock option exercises as calculated by the treasury stock method, and 277,758, 285,433 and 271,881 shares of restricted Class A common stock for the quarters ended March 31, June 30, and September 30, 2019, respectively, were excluded because the effect of including them would have been anti-dilutive.

3.For the quarters ended December 31, 2019, and March 31, June 30, and September 30, 2020, the following securities were excluded from the weighted average effect of dilutive securities in the computation of diluted earnings per share of Class A common stock:

a.12,921,637, 12,769,568 and 12,404,368 shares of weighted average Class B common stock for the quarters ended December 31, 2019, and March 31, and June 30, 2020, respectively, along with the reallocation of net income assuming conversion of these shares, were excluded from the calculation of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive,

b.689,500, 959,000, 1,498,000 and 1,297,500 options to purchase shares of Class A common stock for the quarters ended December 31, 2019, and March 31, June 30, and September 30, 2020, respectively, were excluded because the exercise price

of these options exceeded the average market price of our Class A common stock during the period (“out-of-the-money”) and the effect of including them would have been anti-dilutive, and

c.976,594, 1,127,509 and 1,225,697 shares of Class A common stock for the quarters ended December 31, 2019, and June 30, and September 30, 2020, respectively, resulting from estimated stock option exercises as calculated by the treasury stock method, and 232,828, 193,709 and 94,577 shares of restricted Class A common stock for the quarters ended December 31, 2019, and June 30, and September 30, 2020, respectively, were excluded because the effect of including them would have been anti-dilutive.

4.The reallocation of net income assuming conversion of common units represents the tax effected net income attributable to non-controlling interest using the effective income tax rates described in Note 10 above and assuming all common units of i3 Verticals, LLC were exchanged for Class A common stock at the beginning of the year. The common units of i3 Verticals, LLC held by the Continuing Equity Owners are potentially dilutive securities, and the computations of pro forma diluted net income per share assume that all common units of i3 Verticals, LLC were exchanged for shares of Class A common stock at the beginning of the year.

Subsequent Events	12 Months Ended
Subsequent Events	Sep. 30, 2020
Subsequent Events [Abstract]
Subsequent Events	SUBSEQUENT EVENTS Recent Acquisitions Subsequent to September 30, 2020, the Company completed the acquisition of four businesses. The first acquisition is within the Company’s Public Sector vertical and provides software services to public safety and law enforcement customers. The second acquisition is within the Company’s Healthcare vertical and offers medical billing and other software. The third acquisition offers proprietary technology that will augment the Company’s existing platform across several verticals. The final acquisition sells a combination of proprietary and third-party software, which eliminates paper-based systems by creating integrated electronic workflows for courts and government agencies. Total purchase consideration for the four businesses included $59,600 in cash and revolving line of credit proceeds, and an amount of contingent consideration, which is still being valued. Certain provisions in the purchase agreements provide for additional consideration of up to $30,200, in the aggregate, to be paid based upon the achievement of specified financial performance targets, as defined in the purchase agreements, through no later than April 2023. The Company is in process of determining the acquisition date fair values of the liabilities for the contingent consideration based on discounted cash flow analyses. In each subsequent reporting period, the Company will reassess its current estimates of performance relative to the targets and adjust the contingent liabilities to their fair values through earnings. The effect of three of the acquisitions will be included in the consolidated statements of operations beginning October 1, 2020. The effect of the fourth acquisition will be included in the consolidated statements of operations beginning November 1, 2020. The Company is still evaluating the allocations of the preliminary purchase consideration and pro forma results of operations.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation

Principles of Consolidation

Principles of Consolidation These consolidated financial statements include the accounts of the Company and its subsidiary companies. All significant intercompany accounts and transactions have been eliminated in consolidation

Cash and Cash Equivalents

Cash and Cash Equivalents For purposes of reporting cash flows, the Company considers cash on hand, checking accounts, and savings accounts to be cash and cash equivalents. At times, the balance in these accounts may exceed federal insured limits. Cash equivalents are defined as financial instruments readily transferrable into cash with an original maturity less than 90 days.

Restricted Cash

Restricted Cash Restricted cash represents funds held-on-deposit with processing banks pursuant to agreements to cover potential merchant losses. It is presented as long-term assets on the accompanying consolidated balance sheets since the related agreements extend beyond the next twelve months. Following the adoption of Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows: Restricted Cash (Topic 230), the Company includes restricted cash along with the cash and cash equivalents balance for presentation in the consolidated statements of cash flows.

Accounts Receivable and Credit Policies

Accounts Receivable and Credit Policies Accounts receivable consist primarily of uncollateralized credit card processing residual payments due from processing banks requiring payment within thirty days following the end of each month. Accounts receivable also include amounts due from the sales of the Company’s technology solutions to its customers. The carrying amount of accounts receivable is reduced by an allowance for doubtful accounts, if necessary, which reflects management’s best estimate of the amounts that will not be collected. The allowance is estimated based on management’s knowledge of its customers, historical loss experience and existing economic conditions. Accounts receivable and the allowance are written-off when, in management’s opinion, all collection efforts have been exhausted. The Company’s allowance for doubtful accounts was $310 and $232 as of September 30, 2020 and 2019, respectively; however, actual write-offs may exceed estimated amounts.

Inventories

Inventories Inventories consist of point-of-sale equipment to be sold to customers and are stated at the lower of cost, determined on a weighted average basis, or net realizable value.

Property and Equipment

merchants. Referral agreements represent the right to exclusively obtain referrals from a partner for their customers' credit card processing services.

Income Taxes

Valuation of Contingent Consideration

Valuation of Contingent Consideration On occasion, the Company may have acquisitions which include contingent consideration. Accounting for business combinations requires the Company to estimate the fair value of any contingent purchase consideration at the acquisition date. For a discussion of the estimate methodology and the significance of various inputs, please see the subheading below titled “Use of Estimates.” Changes in estimates regarding the fair value contingent purchase consideration are reflected as adjustments to the related liability and recognized within operating expenses in the consolidated statements of operations. Short and long-term contingent liabilities are presented within accrued expenses and other current liabilities and other long-term liabilities on the Company's consolidated balance sheets, respectively.

Classification of Financial Instruments

Classification of Financial Instruments The Company classifies certain financial instruments issued as either equity or as liabilities. Determination of classification is based upon the underlying properties of the instrument.

Revenue Recognition and Deferred Revenue

•Payments — Includes discount fees, gateway fees and other related fixed transaction or service fees.

•Other — Includes sales of software, sales of equipment, professional services and other revenues.


	For the year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Payments revenue	$	82,913	$	19,359	$	(1,757)	$	100,515
Other revenue	18,036		31,594		(11)		49,619
Total revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

•Revenue transferred over time — Includes discount fees, gateway fees, sales of SaaS and ongoing support contract revenue.

•Revenue transferred at a point in time — Includes fixed service fees, software licenses sold as functional intellectual property, professional services and other equipment.


	For the year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue earned over time	$	72,800	$	35,222	$	(1,743)	$	106,279
Revenue earned at a point in time	28,149		15,731		(25)		43,855
Total revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

Contract Liabilities

The following table presents the changes in deferred revenue as of and for the year ended September 30, 2020:


Balance at September 30, 2019	$	10,237
Deferral of revenue	22,963
Recognition of unearned revenue	(22,146)
Balance at September 30, 2020	$	11,054

Costs to Obtain and Fulfill a Contract

Interchange and Network Fees and Other Cost of Services

The Company accounts for all governmental taxes associated with revenue transactions on a net basis.

Advertising and Promotion Costs

Advertising and Promotion Costs Advertising and promotion costs are expensed as incurred.

Equity-based Compensation

Equity-based Compensation The Company accounts for grants of equity awards to employees in accordance with ASC 718, Compensation—Stock Compensation. This standard requires compensation expense to be measured based on the estimated fair value of the share-based awards on the date of grant and recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period.

Use of Estimates

Recently Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements


	Year ended September 30, 2020
	As reported		Adjustment		Presentation without adoption of ASC 606
Revenue	$	150,134	$	244,097	$	394,231
Operating expenses
Interchange and network fees	$	—	$	244,097	$	244,097

The following table presents the material impacts of adoption of ASC 606 on the Company's consolidated balance sheet as of September 30, 2020:


	As of September 30, 2020
	As reported		Adjustment		Presentation without adoption of ASC 606
Assets
Current assets
Prepaid expenses and other current assets	$	4,869	$	304	$	5,173
Deferred tax asset	$	36,755	$	12	$	36,767
Other assets	$	5,197	$	(1,932)	$	3,265
Liabilities and equity
Stockholders' equity
Accumulated deficit	$	(2,023)	$	(872)	$	(2,895)
Non-controlling interest	$	84,590	$	(744)	$	83,846

Recently Issued Accounting Pronouncements Not Yet Adopted

Fair Value Measurement

Level 1 — Quoted prices for identical instruments in active markets.

Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in active exchange markets.

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Disaggregation of Revenue

•Payments — Includes discount fees, gateway fees and other related fixed transaction or service fees.

•Other — Includes sales of software, sales of equipment, professional services and other revenues.


	For the year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Payments revenue	$	82,913	$	19,359	$	(1,757)	$	100,515
Other revenue	18,036		31,594		(11)		49,619
Total revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

•Revenue transferred over time — Includes discount fees, gateway fees, sales of SaaS and ongoing support contract revenue.

•Revenue transferred at a point in time — Includes fixed service fees, software licenses sold as functional intellectual property, professional services and other equipment.


	For the year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue earned over time	$	72,800	$	35,222	$	(1,743)	$	106,279
Revenue earned at a point in time	28,149		15,731		(25)		43,855
Total revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

Contract with Customer, Asset and Liability

The following table presents the changes in deferred revenue as of and for the year ended September 30, 2020:


Balance at September 30, 2019	$	10,237
Deferral of revenue	22,963
Recognition of unearned revenue	(22,146)
Balance at September 30, 2020	$	11,054

Schedule of New Accounting Pronouncements and Changes in Accounting Principles

The following table presents the material impacts of adopting ASC 606 on the Company's consolidated statement of operations for the year ended September 30, 2020:


	Year ended September 30, 2020
	As reported		Adjustment		Presentation without adoption of ASC 606
Revenue	$	150,134	$	244,097	$	394,231
Operating expenses
Interchange and network fees	$	—	$	244,097	$	244,097

The following table presents the material impacts of adoption of ASC 606 on the Company's consolidated balance sheet as of September 30, 2020:


	As of September 30, 2020
	As reported		Adjustment		Presentation without adoption of ASC 606
Assets
Current assets
Prepaid expenses and other current assets	$	4,869	$	304	$	5,173
Deferred tax asset	$	36,755	$	12	$	36,767
Other assets	$	5,197	$	(1,932)	$	3,265
Liabilities and equity
Stockholders' equity
Accumulated deficit	$	(2,023)	$	(872)	$	(2,895)
Non-controlling interest	$	84,590	$	(744)	$	83,846

Acquisitions (Tables)

12 Months Ended

Sep. 30, 2020

2018 Business Combinations

Pro Forma Information

This supplemental pro forma information does not purport to be indicative of the results of operations that would have been attained had the acquisitions been made on these dates, or of results of operations that may occur in the future.


	Year ended September 30,
	2020		2019
Revenue(1)	$	156,036	$	383,546
Net (loss) income	$	(1,170)	$	472

__________________________

Schedule of Preliminary Purchase Consideration of the Acquired Assets and Assumed Liabilities

The fair values assigned to certain assets and liabilities assumed, as of the acquisition dates, during the year ended September 30, 2018 were as follows:


	SDCR, Inc.		Other		Total
Cash and cash equivalents	$	1,338	$	—	$	1,338
Accounts receivable	1,008		—		1,008
Settlement assets	—		350		350
Related party receivable	773		—		773
Inventories	1,318		—		1,318
Prepaid expenses and other current assets	1,176		8		1,184
Property and equipment	69		58		127
Capitalized software	—		200		200
Acquired merchant relationships	5,500		5,100		10,600
Exclusivity Agreements	—		100		100
Non-compete agreements	40		1,440		1,480
Trade name	1,340		200		1,540
Goodwill	16,523		8,914		25,437
Other assets	—		4		4
Total assets acquired	29,085		16,374		45,459

Accounts payable	1,342		—		1,342
Accrued expenses and other current liabilities	3,123		431		3,554
Settlement obligations	—		350		350
Deferred revenue, current	2,029		190		2,219
Other long-term liabilities	1,757		—		1,757
Net assets acquired	$	20,834	$	15,403	$	36,237

2019 Business Combinations

Schedule of Preliminary Purchase Consideration of the Acquired Assets and Assumed Liabilities

The fair values assigned to certain assets and liabilities assumed, as of the acquisition dates, were as follows:


	Pace		Other		Total
Cash and cash equivalents	$	108	$	4,453	$	4,561
Accounts receivable	545		4,907		5,452
Settlement assets	—		18		18
Inventories	45		61		106
Prepaid expenses and other current assets	59		483		542
Property and equipment	527		1,929		2,456
Capitalized software	3,400		9,440		12,840
Acquired merchant relationships	13,400		34,480		47,880
Non-compete agreements	60		150		210
Trade name	500		1,540		2,040
Goodwill	35,589		47,483		83,072
Other assets	2,622		2		2,624
Total assets acquired	56,855		104,946		161,801

Accounts payable	722		369		1,091
Accrued expenses and other current liabilities	56		2,284		2,340
Settlement obligations	—		18		18
Deferred revenue, current	24		2,698		2,722
Other long-term liabilities	—		690		690
Net assets acquired	$	56,053	$	98,887	$	154,940

2020 Business Combinations

Schedule of Preliminary Purchase Consideration of the Acquired Assets and Assumed Liabilities

The fair values assigned to certain assets and liabilities assumed, as of the acquisition dates, during the year ended September 30, 2020 were as follows:


Cash and cash equivalents	$	313
Accounts receivable	709
Prepaid expenses and other current assets	54
Property and equipment	122
Capitalized software	1,970
Acquired merchant relationships	11,900
Non-compete agreements	90
Trade name	300
Goodwill	19,948
Other assets	17
Total assets acquired	35,423

Accounts payable	168
Accrued expenses and other current liabilities	623
Deferred revenue, current	200
Other long-term liabilities	1,799
Net assets acquired	$	32,633

Property and Equipment, Net (Tables)

12 Months Ended

Sep. 30, 2020

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment

A summary of the Company's property and equipment as of September 30, 2020 and 2019 is as follows:


	Estimated Useful Life	2020		2019
Computer equipment and software(1)	2 to 7 years	$	2,382	$	1,990
Furniture and fixtures	2 to 7 years	1,867		1,639
Terminals	2 to 3 years	584		429
Office equipment	2 to 5 years	942		940
Automobiles	3 years	366		307
Leasehold improvements	2 to 7 years	2,194		1,665
Accumulated depreciation		(2,996)		(1,944)
Property and equipment, net		$	5,339	$	5,026

____________________

1.Includes computer software of $694 and $674 as of September 30, 2020 and 2019, respectively.

Capitalized Software, Net (Tables)

12 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Capitalized Computer Software

A summary of the Company's capitalized software as of September 30, 2020 and 2019 is as follows:


	Estimated Useful Life	2020		2019
Software development costs	1 to 7 years	$	21,485	$	20,347
Development in progress		2,638		833
Accumulated amortization		(7,134)		(5,726)
Capitalized software, net		$	16,989	$	15,454

Goodwill and Intangible Assets (Tables)

12 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Changes in Carrying Amount of Goodwill

Changes in the carrying amount of goodwill are as follows:


	Merchant Services		Proprietary Software and Payments		Other		Total
Balance at September 30, 2018 (net of accumulated impairment losses of $11,458, $0 and $0, respectively)	$	70,936	$	13,018	$	—	$	83,954
Goodwill attributable to preliminary purchase price adjustments and acquisition activity during the year ended September 30, 2019	46,398		37,932		—		84,330
Balance at September 30, 2019	117,334		50,950		—		168,284
Goodwill reassigned in segment realignment(1)	(419)		419		—		—
Goodwill attributable to preliminary purchase price adjustments and acquisition activity during the year ended September 30, 2020	(933)		19,654		—		18,721
Balance at September 30, 2020	$	115,982	$	71,023	$	—	$	187,005

____________________

Schedule of Finite-Lived Intangible Assets

Intangible assets consisted of the following as of September 30, 2020:


	Cost		Accumulated Amortization		Carrying Value		Amortization Life and Method
Finite-lived intangible assets:
Merchant relationships	$	154,571	$	(53,388)	$	101,183	12 to 20 years – accelerated or straight-line
Non-compete agreements	1,700		(851)		849		3 to 5 years – straight-line
Website and brand development costs	215		(65)		150		3 to 4 years – straight-line
Trade names	3,880		(1,538)		2,342		3 to 7 years – straight-line
Residual buyouts	5,373		(1,172)		4,201		2 to 8 years – straight-line
Referral and exclusivity agreements	900		(434)		466		5 to 10 years – straight-line
Total finite-lived intangible assets	166,639		(57,448)		109,191

Indefinite-lived intangible assets:
Trademarks	42		—		42
Total identifiable intangible assets	$	166,681	$	(57,448)	$	109,233

Intangible assets consisted of the following as of September 30, 2019:


	Cost		Accumulated Amortization		Carrying Value		Amortization Life and Method
Finite-lived intangible assets:
Merchant relationships	$	142,671	$	(43,579)	$	99,092	12 to 20 years – accelerated or straight-line
Non-compete agreements	1,770		(619)		1,151		2 to 5 years – straight-line
Website development costs	77		(22)		55		3 years – straight-line
Trade names	4,292		(1,307)		2,985		3 to 7 years – straight-line
Residual buyouts	5,346		(1,882)		3,464		2 to 8 years – straight-line
Referral and exclusivity agreements	900		(264)		636		5 to 10 years – straight-line
Total finite-lived intangible assets	155,056		(47,673)		107,383

Indefinite-lived intangible assets:
Trademarks	36		—		36
Total identifiable intangible assets	155,092		(47,673)		107,419

Schedule of Indefinite-Lived Intangible Assets

Intangible assets consisted of the following as of September 30, 2020:


	Cost		Accumulated Amortization		Carrying Value		Amortization Life and Method
Finite-lived intangible assets:
Merchant relationships	$	154,571	$	(53,388)	$	101,183	12 to 20 years – accelerated or straight-line
Non-compete agreements	1,700		(851)		849		3 to 5 years – straight-line
Website and brand development costs	215		(65)		150		3 to 4 years – straight-line
Trade names	3,880		(1,538)		2,342		3 to 7 years – straight-line
Residual buyouts	5,373		(1,172)		4,201		2 to 8 years – straight-line
Referral and exclusivity agreements	900		(434)		466		5 to 10 years – straight-line
Total finite-lived intangible assets	166,639		(57,448)		109,191

Indefinite-lived intangible assets:
Trademarks	42		—		42
Total identifiable intangible assets	$	166,681	$	(57,448)	$	109,233

Intangible assets consisted of the following as of September 30, 2019:


	Cost		Accumulated Amortization		Carrying Value		Amortization Life and Method
Finite-lived intangible assets:
Merchant relationships	$	142,671	$	(43,579)	$	99,092	12 to 20 years – accelerated or straight-line
Non-compete agreements	1,770		(619)		1,151		2 to 5 years – straight-line
Website development costs	77		(22)		55		3 years – straight-line
Trade names	4,292		(1,307)		2,985		3 to 7 years – straight-line
Residual buyouts	5,346		(1,882)		3,464		2 to 8 years – straight-line
Referral and exclusivity agreements	900		(264)		636		5 to 10 years – straight-line
Total finite-lived intangible assets	155,056		(47,673)		107,383

Indefinite-lived intangible assets:
Trademarks	36		—		36
Total identifiable intangible assets	155,092		(47,673)		107,419

Schedule of Future Amortization Expense of Finite-lived Intangible Assets


2021	$	11,645
2022	10,500
2023	9,428
2024	8,702
2025	8,495
Thereafter	60,421
	$	109,191

Accrued Expenses and Other Liabilities (Tables)

12 Months Ended

Sep. 30, 2020

Payables and Accruals [Abstract]

Summary of Accrued Expenses and Other Current Liabilities

A summary of the Company's accrued expenses and other current liabilities as of September 30, 2020 and 2019 is as follows:


	2020		2019
Accrued wages, bonuses, commissions and vacation	$	3,867	$	4,256
Accrued interest	141		254
Accrued contingent consideration — current portion	10,062		10,223
Escrow liabilities	4,363		1,414
Tax receivable agreement liability — current portion	—		24
Customer deposits	1,828		1,968
Other current liabilities	3,803		3,421
Accrued expenses and other current liabilities	$	24,064	$	21,560

Summary of Long-term Liabilities

A summary of the Company's long-term liabilities as of September 30, 2020 and 2019 is as follows:


	2020		2019
Accrued contingent consideration — long-term portion	$	2,972	$	8,003
Deferred tax liability — long-term	2,212		516
Other long-term liabilities	956		605
Total other long-term liabilities	$	6,140	$	9,124

Long-Term Debt, Net (Tables)

12 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

Summary of Long-term Debt

A summary of long-term debt, net as of September 30, 2020 and September 30, 2019 is as follows:


	Maturity	2020		2019
Revolving lines of credit to banks under the Senior Secured Credit Facility	May 9, 2024	$	—	$	141,144
1.0% Exchangeable Senior Notes due 2025	February 15, 2025	95,325		—
Debt issuance costs, net		(4,567)		(1,846)
Total long-term debt, net of issuance costs		$	90,758	$	139,298

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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Schedule of Components of Income Tax Expense

Income Taxes (Tables)

12 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]


	Year ended September 30,
	2020		2019		2018
Current:
Federal tax (benefit) expense	$	(34)	$	220	$	668
State tax expense	446		189		351
Deferred:
Federal tax benefit	(3,018)		(487)		(685)
State tax (benefit) expense	(189)		(99)		3
Income tax (benefit) expense	$	(2,795)	$	(177)	$	337

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of income tax expense from operations computed at the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows:


	Year ended September 30,
	2020				2019				2018
Expected U.S. federal income taxes at statutory rate	$	(792)	21.0	%	$	81	21.0	%	$	(1,139)	24.6	%
Partnership income not taxed at federal level	85		(2.3)	%	(1,007)		(260.9)	%	294		(6.4)	%
Valuation allowance	(2,694)		71.4	%	251		65.0	%	965		(20.9)	%
State and local income taxes, net of federal benefit	244		(6.5)	%	104		26.9	%	295		(6.4)	%
Nondeductible expenses and other permanent items	496		(13.1)	%	582		150.8	%	66		(1.4)	%
Revaluation of debt and other debt transaction differences	222		(5.9)	%	(189)		(49.0)	%	332		(7.2)	%
Federal tax rate change	—		—	%	—		—	%	(471)		10.2	%
Change in liability for uncertain tax positions	108		(2.9)	%	—		—	%	—		—	%
Federal tax credits	(431)		11.4	%	—		—	%	—		—	%
Other	(33)		0.9	%	1		0.3	%	(5)		0.1	%
Income tax (benefit) expense	$	(2,795)	74.1	%	$	(177)	(45.9)	%	$	337	(7.3)	%

Schedule of Deferred Tax Assets and Liabilities

Net deferred taxes spanning multiple jurisdictions as of September 30, 2020 and 2019 were as follows:


	September 30,
	2020		2019
Deferred tax assets:
Investment in partnership	$	47,897	$	40,880
Stock-based compensation	1187		811
Deferred revenue	525		564
Accrued expenses	181		110
Net operating loss carryforwards	10,969		6,360
Section 163j carryforward	2,498		2,006
Federal tax credits	901		—
Other	73		42
Gross deferred tax assets	64,231		50,773
Valuation allowance	(20,230)		(16,609)

Deferred tax liabilities:
Intangible assets	$	(9,167)	$	(6,257)
Other	(291)		(285)
Net deferred tax asset	$	34,543	$	27,622

Summary of Components of Uncertain Tax Positions

The components of the Company’s liability for uncertain tax benefits are as follows:


Gross unrecognized tax benefits as of September 30, 2019	$	—
Increase in current year tax positions	108
Increase in prior year tax positions	76
Gross unrecognized tax benefits as of September 30, 2020	$	184

Fair Value Measurements (Tables)

12 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Changes in Level 3 Financial Instruments Measured on a Recurring Basis

The following tables present the changes in the Company's Level 3 financial instruments that are measured at fair value on a recurring basis.


	Accrued Contingent Consideration
Balance at September 30, 2018	$	5,999
Contingent consideration accrued at time of business combination	13,032
Change in fair value of contingent consideration included in Operating expenses	3,389
Contingent consideration paid	(4,194)
Balance at September 30, 2019	$	18,226

Contingent consideration accrued at time of business combination	4,748
Change in fair value of contingent consideration included in Operating expenses	(1,409)
Contingent consideration paid	(8,531)
Balance at September 30, 2020	$	13,034

Equity-Based Compensation (Tables)

12 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Summary of Equity-Based Compensation Expense

A summary of equity-based compensation expense recognized during the years ended September 30, 2020, 2019 and 2018 is as follows:


	Year ended September 30,
	2020		2019		2018
TRA non-participation compensatory shares	$	—	$	—	$	741
Stock options	10,452		6,124		826
Equity-based compensation expense	$	10,452	$	6,124	$	1,567

Fair Value of Stock Option Awards


	September 30, 2020		September 30, 2019
Expected volatility(1)	28.5	%	26.7	%
Expected dividend yield(2)	—	%	—	%
Expected term(3)	6 years		6 years
Risk-free interest rate(4)	1.2	%	2.5	%

_________________

1.Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term.

2.The Company has assumed a dividend yield of zero as management has no plans to declare dividends in the foreseeable future.

4.The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term.

Summary of Stock Option Activity

A summary of stock option activity for the year ended September 30, 2020 is as follows:


	Stock Options	Weighted Average Exercise Price
Outstanding at beginning of period	4,240,695	$	18.33
Granted	1,438,900	30.37
Exercised	(331,141)	15.85
Forfeited	(137,888)	21.56
Outstanding at end of period	5,210,566	$	21.73

Stockholders' / Members' Equity and Redeemable Class A Units (Tables)

12 Months Ended

Sep. 30, 2020

Equity [Abstract]

Schedule of Warrants

Warrants

Expiration

Exercise Price

Junior Subordinated Notes Warrants

1,433,920

February 14, 2024

2.095

Commitments and Contingencies (Tables)

12 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Schedule of Approximate Future Minimum Rental Payments for Operating Leases

A summary of approximate future minimum payments under these leases as of September 30, 2020 is as follows:


Years ending September 30:
2021	$	2,726
2022	2,397
2023	2,096
2024	1,469
2025	968
Thereafter	1,221
Total	$	10,877

Minimum Fee Commitments

As of September 30, 2020, such minimum fee commitments were as follows:


Years ending September 30:
2021	$	3,334
2022	2,818
2023	2,645
2024	450
2025	—
Thereafter	—
Total	$	9,247

Segments (Tables)

12 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Summary of Reportable Segment Performance


	As of and for the Year ended September 30, 2020
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue	$	100,949	$	50,953	$	(1,768)	$	150,134

Operating expenses
Other costs of services	43,940		5,057		(1,767)		47,230
Selling general and administrative	26,376		28,187		23,760		78,323
Depreciation and amortization	11,796		5,723		698		18,217
Change in fair value of contingent consideration	(4,691)		3,282		—		(1,409)
Income (loss) from operations	$	23,528	$	8,704	$	(24,459)	$	7,773

Processing margin(1)	$	78,627	$	46,483	$	(1,758)	$	123,352
Total assets	$	206,769	$	139,107	$	57,650	$	403,526
Goodwill	$	115,982	$	71,023	$	—	$	187,005

__________________________


	As of and for the Year ended September 30, 2019
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue	$	338,968	$	37,339	$	—	$	376,307

Operating expenses
Interchange and network fees	236,170		6,697		—		242,867
Other costs of services	41,487		2,750		—		44,237
Selling general and administrative	27,275		17,059		18,526		62,860
Depreciation and amortization	12,221		3,790		553		16,564
Change in fair value of contingent consideration	(477)		3,866		—		3,389
Income (loss) from operations	$	22,292	$	3,177	$	(19,079)	$	6,390

Processing margin(1)	$	78,369	$	28,497	$	—	$	106,866
Total assets	$	216,420	$	99,420	$	33,462	$	349,302
Goodwill	$	117,334	$	50,950	$	—	$	168,284

__________________________


	As of and for the Year ended September 30, 2018
	Merchant Services		Proprietary Software and Payments		Other		Total
Revenue	$	303,692	$	19,819	$	(3)	$	323,508

Operating expenses
Interchange and network fees	209,705		4,838		—		214,543
Other costs of services	38,563		1,752		(1)		40,314
Selling general and administrative	23,716		7,177		9,692		40,585
Depreciation and amortization	9,736		1,896		207		11,839
Change in fair value of contingent consideration	2,103		1,763		—		3,866
Income (loss) from operations	$	19,869	$	2,393	$	(9,901)	$	12,361

Processing margin(1)	$	69,449	$	13,733	$	(2)	$	83,180
Total assets	$	143,792	$	26,524	$	4,826	$	175,142
Goodwill	$	70,936	$	13,018	$	—	$	83,954

__________________________

Noncontrolling Interest (Tables)

12 Months Ended

Sep. 30, 2020

Noncontrolling Interest [Abstract]

Summary of Ownership Interest

The following table summarizes the impact on equity due to changes in the Company's ownership interest in i3 Verticals, LLC:


	Year ended September 30,
	2020		2019		2018
Net (loss) income attributable to non-controlling interest	$	(560)	$	3,608	$	1,937
Transfers to (from) non-controlling interests:
Allocation of equity to non-controlling interests arising from the reorganization transactions and IPO	—		—		70,960
Distributions to non-controlling interest holders	(3)		(2,060)		—
Redemption of common units in i3 Verticals, LLC	(5,080)		(12,077)		—
Adjustment related to prior periods	2,730		—		—
Cumulative effect of adoption of new accounting standard	640		—		—
Allocation of equity to non-controlling interests	24,495		—		—
Net transfers to (from) non-controlling interests	22,782		(14,137)		70,960
Change from net income attributable to non-controlling interests and transfers to (from) non-controlling interests	$	22,222	$	(10,529)	$	72,897

Earnings Per Share (Tables)

12 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Schedule of Reconciliations of the Numerators and Denominators Used to Compute Basic and Diluted Earnings Per Share

The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock:


	Year ended September 30,
	2020		2019		2018
Basic net (loss) income per share:
Numerator
Net (loss) income(1)	$	(979)	$	563	$	2,673
Less: Net (loss) income attributable to non-controlling interests	(560)		3,608		1,937
Net (loss) income attributable to Class A common stockholders	$	(419)	$	(3,045)	$	736
Denominator
Weighted average shares of Class A common stock outstanding(2)	14,833,378		10,490,981		8,812,630
Basic net (loss) income per share(3)	$	(0.03)	$	(0.29)	$	0.08

Dilutive net (loss) income per share(3):
Numerator
Net (loss) income attributable to Class A common stockholders	$	(419)			$	736
Reallocation of net (loss) income assuming conversion of common units(5)	(422)				1,464
Net (loss) income attributable to Class A common stockholders - diluted	$	(841)			$	2,200
Denominator
Weighted average shares of Class A common stock outstanding(2)(4)	14,833,378				8,812,630
Weighted average effect of dilutive securities	12,596,423				18,061,248
Weighted average shares of Class A common stock outstanding - diluted	27,429,801				26,873,878
Diluted net (loss) income per share	$	(0.03)			$	0.08

____________________

2.Excludes 204,969, 282,801 and 299,412 shares of restricted Class A common stock for the years ended September 30, 2020, 2019 and 2018, respectively.

Significant Non-cash Transactions (Tables)

12 Months Ended

Sep. 30, 2020

Cash Flow, Noncash Investing and Financing Activities Disclosure [Abstract]

Schedule of Significant Noncash Transactions

The Company engaged in the following significant non-cash investing and financing activities during the years ended September 30, 2020, 2019, and 2018:


	Year ended September 30,
	2020		2019		2018
Common Units issued as part of acquisitions' purchase consideration (Note 4)	$	—	$	—	$	104
Restricted Class A common stock issued as part of acquisitions' purchase consideration (Note 4)	$	—	$	225	$	550
Acquisition date fair value of contingent consideration in connection with business combinations	$	4,748	$	13,032	$	2,084
Replacement of the 2016 Senior Secured Credit Facility with the 2017 Senior Secured Credit Facility	$	—	$	—	$	87,525
Replacement of the 2017 Senior Secured Credit Facility with the Senior Secured Credit Facility	$	—	$	100,229	$	—
Mezzanine Notes net settled with Mezzanine Warrant exercises	$	—	$	—	$	14
Unsecured notes payable to related and unrelated creditors net settled with Junior Subordinated Notes Warrants	$	—	$	—	$	2,565
Settlement of warrant liability with equity as a result of Mezzanine Warrant exercise	$	—	$	—	$	9,253
Preferred return on Redeemable Class A Units	$	—	$	—	$	552
Preferred return on Class A Units	$	—	$	—	$	2,522
Debt issuance costs financed with proceeds from the 2017 Senior Secured Credit Facility	$	—	$	—	$	904
Debt issuance costs and accrued interest financed with proceeds from the 2019 Senior Secured Credit Facility	$	—	$	1,271	$	—
Conversion of notes payable to related and unrelated creditors to Class A common stock	$	—	$	—	$	8,054

Quarterly Information (Unaudited) (Tables)

12 Months Ended

Sep. 30, 2020

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Information


	Quarter ended
	December 31,		March 31,		June 30,		September 30,
Fiscal Year 2019:
Revenue	$	84,868	$	85,394	$	97,483	$	108,562
Income (loss) from operations	$	3,530	$	(203)	$	1,194	$	1,869
Income (loss) before income taxes	$	2,616	$	(1,358)	$	(724)	$	(148)
Net income (loss) attributable to i3 Verticals, Inc.	$	178	$	(1,102)	$	(1,191)	$	(930)
Basic earnings (loss) per share attributable to i3 Verticals, Inc.(1)	$	0.02	$	(0.12)	$	(0.12)	$	(0.07)
Diluted earnings (loss) per share attributable to i3 Verticals, Inc.(2)(4)	$	0.02	$	(0.12)	$	(0.12)	$	(0.07)
Fiscal Year 2020:
Revenue	$	41,111	$	39,178	$	31,573	$	38,272
Income from operations	$	4,097	$	2,041	$	437	$	1,198
Income (loss) before income taxes	$	2,083	$	(143)	$	(2,815)	$	(2,899)
Net (loss) income attributable to i3 Verticals, Inc.	$	(149)	$	737	$	(356)	$	(651)
Basic (loss) earnings per share attributable to i3 Verticals, Inc.(1)	$	(0.01)	$	0.05	$	(0.02)	$	(0.04)
Diluted (loss) earnings per share attributable to i3 Verticals, Inc.(3)(4)	$	(0.01)	$	0.05	$	(0.02)	$	(0.06)

____________________

of these options exceeded the average market price of our Class A common stock during the period (“out-of-the-money”) and the effect of including them would have been anti-dilutive, and

Organization and Operations (Details) - USD ($) $ / shares in Units, $ in Thousands	Sep. 15, 2020	Jun. 10, 2019	Jun. 25, 2018	Sep. 30, 2020	Sep. 30, 2019
i3Verticals, LLC
Subsidiary, Sale of Stock [Line Items]
Non-controlling interest, ownership interest (percent)				61.30%	52.80%
Continuing Equity Owner
Subsidiary, Sale of Stock [Line Items]
Shareholders ownership interest (percent)				39.20%
Class A Common Stock \| Continuing Equity Owner
Subsidiary, Sale of Stock [Line Items]
Shareholders ownership interest (percent)				0.50%
Class B Common Stock \| Continuing Equity Owner
Subsidiary, Sale of Stock [Line Items]
Shareholders ownership interest (percent)				38.70%
IPO
Subsidiary, Sale of Stock [Line Items]
Shares issued (shares)			7,647,500
Public offering price (in USD per share)			$ 13.00
Net proceeds from IPO			$ 92,500
Secondary Public Offering \| i3Verticals, LLC
Subsidiary, Sale of Stock [Line Items]
Net proceeds from IPO		$ 20,870
Common units, purchased (in units)		1,000,000
Secondary Public Offering \| Continuing Equity Owner
Subsidiary, Sale of Stock [Line Items]
Common units, purchased (in units)		4,165,527
Secondary Public Offering \| Class A Common Stock
Subsidiary, Sale of Stock [Line Items]
Shares issued (shares)		5,165,527
Public offering price (in USD per share)		$ 22.75
Net proceeds from IPO		$ 111,640
Underwriters exercised option to purchase additional shares (shares)		673,764
Primary Public Offering \| i3Verticals, LLC
Subsidiary, Sale of Stock [Line Items]
Net proceeds from IPO	$ 72,018
Common units, purchased (in units)	3,250,000
Primary Public Offering \| Continuing Equity Owner
Subsidiary, Sale of Stock [Line Items]
Common units, purchased (in units)	487,500
Primary Public Offering \| Class A Common Stock
Subsidiary, Sale of Stock [Line Items]
Shares issued (shares)	3,737,500
Public offering price (in USD per share)	$ 23.50
Net proceeds from IPO	$ 83,400
Underwriters exercised option to purchase additional shares (shares)	487,500

Summary of Significant Accounting Policies (Details)

12 Months Ended

Oct. 01, 2020

USD ($)

Sep. 30, 2020

USD ($)

reportable_unit

Sep. 30, 2019

USD ($)

Sep. 30, 2018

USD ($)

Oct. 01, 2019

USD ($)

Allowance for doubtful accounts

$ 310,000

$ 232,000

Inventories

1,309,000

1,294,000

Impairment charges

$ 0

Estimated useful life

3 years

Notes receivable, fair value disclosure

$ 1,195,000

195,000

Revenue from acquisitions

1,275,000

Net income

327,000

Goodwill impairment

$ 0

Number of reporting units | reportable_unit

Amortization expense of intangible assets

$ 12,414,000

12,394,000

9,341,000

Impairment of intangible assets, excluding goodwill

Capitalized contract cost, gross

3,140,000

Advertising expense

1,813,000

1,443,000

926,000

Equity-based compensation expense

10,452,000

6,124,000

1,567,000

Benefit from income taxes

$ 2,795,000

177,000

(337,000)

Accounting Standards Update [Extensible List]

us-gaap:AccountingStandardsUpdate201409Member

Cumulative increase to equity

$ 240,168,000

142,441,000

112,198,000

Accumulated earnings

(2,023,000)

(2,309,000)

84,590,000

62,368,000

242,867,000

^[1]

214,543,000

^[1]

Subsequent Event

Accounting Standards Update [Extensible List]

us-gaap:AccountingStandardsUpdate201602Member

Presentation without adoption of ASC 606

Accumulated earnings

(2,895,000)

83,846,000

244,097,000

Operating Expense

Cumulative Effect, Period of Adoption, Adjustment

242,867,000

$ 214,543,000

Cumulative increase to equity

1,345,000

Accumulated earnings

$ 705,000

Cumulative Effect, Period of Adoption, Adjustment | Subsequent Event | Forecast

$ 640,000

Right-of-Use asset

$ 9,093,000

Lease liability

$ 9,760,000

Class B Common Stock

Reduction in the benefit from income taxes

235,000

Increase to net loss

3,728,000

Reduction in company's net loss

3,493,000

Intangible Assets, Amortization Period

Amortization expense of intangible assets

398,000

$ 1,290,000

Change in Accounting Method Accounted for as Change in Estimate

Change in valuation allowance for deferred tax assets

2,668,000

Benefit from income taxes

$ (2,668,000)

[1]

Effective October 1, 2019, the Company's revenues are presented net of interchange and network fees in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers. See Note 2 to our consolidated financial statements for a description of the recently adopted accounting pronouncement.

Summary of Significant Accounting Policies - Disaggregated Revenue (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2020 USD ($)
Concentration Risk [Line Items]
Revenue	$ 150,134
Revenue earned over time
Concentration Risk [Line Items]
Revenue	106,279
Revenue earned at a point in time
Concentration Risk [Line Items]
Revenue	43,855
Merchant Services
Concentration Risk [Line Items]
Revenue	100,949
Merchant Services \| Revenue earned over time
Concentration Risk [Line Items]
Revenue	72,800
Merchant Services \| Revenue earned at a point in time
Concentration Risk [Line Items]
Revenue	28,149
Proprietary Software and Payments
Concentration Risk [Line Items]
Revenue	50,953
Proprietary Software and Payments \| Revenue earned over time
Concentration Risk [Line Items]
Revenue	35,222
Proprietary Software and Payments \| Revenue earned at a point in time
Concentration Risk [Line Items]
Revenue	15,731
Other
Concentration Risk [Line Items]
Revenue	(1,768)
Other \| Revenue earned over time
Concentration Risk [Line Items]
Revenue	(1,743)
Other \| Revenue earned at a point in time
Concentration Risk [Line Items]
Revenue	(25)
Payments revenue
Concentration Risk [Line Items]
Revenue	100,515
Payments revenue \| Merchant Services
Concentration Risk [Line Items]
Revenue	82,913
Payments revenue \| Proprietary Software and Payments
Concentration Risk [Line Items]
Revenue	19,359
Payments revenue \| Other
Concentration Risk [Line Items]
Revenue	(1,757)
Other revenue
Concentration Risk [Line Items]
Revenue	49,619
Other revenue \| Merchant Services
Concentration Risk [Line Items]
Revenue	18,036
Other revenue \| Proprietary Software and Payments
Concentration Risk [Line Items]
Revenue	31,594
Other revenue \| Other
Concentration Risk [Line Items]
Revenue	$ (11)

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Summary of Significant Accounting Policies - Changes in Deferred Revenue (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2020 USD ($)
Contract with customer, Liability [Roll Forward]
Deferred revenue, beginning	$ 10,237
Deferral of revenue	22,963
Recognition of unearned revenue	(22,146)
Deferred revenue, ending	$ 11,054

Summary of Significant Accounting Policies - Impact of Adoption of ASC 606 (Details) - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2020

Sep. 30, 2019

Sep. 30, 2018

^[1]

$ 150,134

Prepaid expenses and other current assets

$ 242,867

^[1]

$ 214,543

Current assets

4,869

Deferred tax asset

36,755

28,138

Other assets

5,197

2,329

Liabilities and equity

Accumulated deficit

(2,023)

(2,309)

Presentation without adoption of ASC 606

84,590

$ 62,368

394,231

Prepaid expenses and other current assets

244,097

Current assets

5,173

Deferred tax asset

36,767

Other assets

3,265

Liabilities and equity

Accumulated deficit

(2,895)

Accounting Standards Update 2014-09 | Adjustment

83,846

244,097

Prepaid expenses and other current assets

244,097

Current assets

304

Deferred tax asset

Other assets

(1,932)

Liabilities and equity

Accumulated deficit

(872)

$ (744)

[1]

Credit Risk and Other Concentrations (Details)	12 Months Ended
Credit Risk and Other Concentrations (Details)	Sep. 30, 2020 payment_processor customer	Sep. 30, 2019 payment_processor customer	Sep. 30, 2018 payment_processor customer
Concentration Risk [Line Items]
Number of third party payment processors	6
Gross Revenue \| Customer Concentration Risk
Concentration Risk [Line Items]
Number of customers \| customer	0	0	0
Concentration risk (percent)	10.00%	10.00%	10.00%
Gross Revenue \| Supplier Concentration Risk
Concentration Risk [Line Items]
Number of third party payment processors	3	3	3
Concentration risk (percent)	10.00%	10.00%	10.00%

Acquisitions - Additional Information (Details) - USD ($)	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Finite-Lived Intangible Assets [Line Items]
Estimated amortization period			10 years
Residual buyouts
Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	$ 1,788,000	$ 3,585,000	$ 1,567,000
Estimated amortization period	8 years	7 years	2 years
Referral agreement
Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	$ 0	$ 0	$ 815,000
Estimated amortization period	5 years

Acquisitions - Schedule of Preliminary Purchase Consideration of the Acquired Assets and Assumed Liabilities (Details) $ in Thousands			12 Months Ended
	May 31, 2019 USD ($)	Oct. 31, 2017 USD ($)	Sep. 30, 2020 USD ($) payment_processor	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Business Acquisition [Line Items]
Common units issued to seller			$ 0	$ 0	$ 104
Estimated amortization period					10 years
Acquisition-related costs				1,179
Goodwill			187,005	168,284	$ 83,954
2018 Business Combinations
Business Acquisition [Line Items]
Cash and cash equivalents					1,338
Accounts receivable					1,008
Settlement assets					350
Related party receivable					773
Inventories					1,318
Prepaid expenses and other current assets					1,184
Property and equipment					127
Goodwill					25,437
Other assets					4
Total assets acquired					45,459
Accounts payable					1,342
Accrued expenses and other current liabilities					3,554
Settlement obligations					350
Deferred revenue, current					2,219
Other long-term liabilities					1,757
Net assets acquired					36,237
San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Total purchase consideration		$ 20,834
Proceeds from issuance of long-term debt used to fund the acquisition		20,000
Contingent cash consideration		$ 730
Estimated amortization period		11 years
Acquisition-related costs		$ 293
Potential additional consideration		2,400
Cash and cash equivalents					1,338
Accounts receivable					1,008
Settlement assets					0
Related party receivable					773
Inventories					1,318
Prepaid expenses and other current assets					1,176
Property and equipment					69
Goodwill					16,523
Other assets					0
Total assets acquired					29,085
Accounts payable					1,342
Accrued expenses and other current liabilities					3,123
Settlement obligations					0
Deferred revenue, current					2,029
Other long-term liabilities					1,757
Net assets acquired					20,834
Other 2018 Business Combinations
Business Acquisition [Line Items]
Total purchase consideration					15,604
Common units issued to seller					550
Proceeds from issuance of long-term debt used to fund the acquisition					13,700
Contingent cash consideration					$ 1,354
Estimated amortization period					12 years
Acquisition-related costs					$ 233
Potential additional consideration					11,800
Cash and cash equivalents					0
Accounts receivable					0
Settlement assets					350
Related party receivable					0
Inventories					0
Prepaid expenses and other current assets					8
Property and equipment					58
Goodwill					8,914
Other assets					4
Total assets acquired					16,374
Accounts payable					0
Accrued expenses and other current liabilities					431
Settlement obligations					350
Deferred revenue, current					190
Other long-term liabilities					0
Net assets acquired					15,403
2019 Business Combinations
Business Acquisition [Line Items]
Adjustment to current assets			153
Adjustment to other assets			933
Adjustment to liabilities			(258)
Adjustment to goodwill			(1,227)
Cash and cash equivalents				4,561
Accounts receivable				5,452
Settlement assets				18
Inventories				106
Prepaid expenses and other current assets				542
Property and equipment				2,456
Goodwill				83,072
Other assets				2,624
Total assets acquired				161,801
Accounts payable				1,091
Accrued expenses and other current liabilities				2,340
Settlement obligations				18
Deferred revenue, current				2,722
Other long-term liabilities				690
Net assets acquired				154,940
Pace Payment Systems, Inc.
Business Acquisition [Line Items]
Common units issued to seller	$ 56,053
Proceeds from issuance of long-term debt used to fund the acquisition	52,492
Contingent cash consideration	$ 3,336
Estimated amortization period	15 years
Acquisition-related costs	$ 507			444
Potential additional consideration	20,000
Cash and cash equivalents				108
Accounts receivable				545
Settlement assets				0
Inventories				45
Prepaid expenses and other current assets				59
Property and equipment				527
Goodwill				35,589
Other assets				2,622
Total assets acquired				56,855
Accounts payable				722
Accrued expenses and other current liabilities				56
Settlement obligations				0
Deferred revenue, current				24
Other long-term liabilities				0
Net assets acquired				56,053
Other 2019 Business Combinations
Business Acquisition [Line Items]
Total purchase consideration				98,887
Proceeds from issuance of long-term debt used to fund the acquisition				89,191
Contingent cash consideration				$ 9,696
Estimated amortization period				16 years
Acquisition-related costs				$ 1,299
Potential additional consideration				34,900
Cash and cash equivalents				4,453
Accounts receivable				4,907
Settlement assets				18
Inventories				61
Prepaid expenses and other current assets				483
Property and equipment				1,929
Goodwill				47,483
Other assets				2
Total assets acquired				104,946
Accounts payable				369
Accrued expenses and other current liabilities				2,284
Settlement obligations				18
Deferred revenue, current				2,698
Other long-term liabilities				690
Net assets acquired				98,887
2020 Business Combinations
Business Acquisition [Line Items]
Total purchase consideration			32,633
Proceeds from issuance of long-term debt used to fund the acquisition			27,885
Contingent cash consideration			$ 4,748
Estimated amortization period			16 years
Acquisition-related costs			$ 547
Potential additional consideration			$ 18,600
Number of businesses acquired \| payment_processor			3
Cash and cash equivalents			$ 313
Accounts receivable			709
Prepaid expenses and other current assets			54
Property and equipment			122
Goodwill			19,948
Other assets			17
Total assets acquired			35,423
Accounts payable			168
Accrued expenses and other current liabilities			623
Deferred revenue, current			200
Other long-term liabilities			1,799
Net assets acquired			$ 32,633
Class A Common Stock \| Pace Payment Systems, Inc.
Business Acquisition [Line Items]
Common units issued to seller	$ 225
i3Verticals, LLC \| San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Common units issued to seller		$ 104
Capitalized software \| 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					200
Capitalized software \| San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Intangible assets					0
Capitalized software \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					200
Capitalized software \| 2019 Business Combinations
Business Acquisition [Line Items]
Intangible assets				12,840
Capitalized software \| Pace Payment Systems, Inc.
Business Acquisition [Line Items]
Estimated amortization period	7 years
Intangible assets				$ 3,400
Capitalized software \| Other 2019 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period				6 years
Intangible assets				$ 9,440
Capitalized software \| 2020 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period			7 years
Intangible assets			$ 1,970
Acquired merchant relationships \| 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					10,600
Acquired merchant relationships \| San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Estimated amortization period		12 years
Intangible assets					5,500
Acquired merchant relationships \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					5,100
Acquired merchant relationships \| 2019 Business Combinations
Business Acquisition [Line Items]
Intangible assets				47,880
Acquired merchant relationships \| Pace Payment Systems, Inc.
Business Acquisition [Line Items]
Estimated amortization period	15 years
Intangible assets				13,400
Acquired merchant relationships \| Other 2019 Business Combinations
Business Acquisition [Line Items]
Intangible assets				34,480
Acquired merchant relationships \| 2020 Business Combinations
Business Acquisition [Line Items]
Intangible assets			$ 11,900
Exclusivity Agreements \| 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					100
Exclusivity Agreements \| San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Intangible assets					0
Exclusivity Agreements \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					100
Non-compete agreements \| 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					1,480
Non-compete agreements \| San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Estimated amortization period		2 years
Intangible assets					$ 40
Non-compete agreements \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period					5 years
Intangible assets					$ 1,440
Non-compete agreements \| 2019 Business Combinations
Business Acquisition [Line Items]
Intangible assets				210
Non-compete agreements \| Pace Payment Systems, Inc.
Business Acquisition [Line Items]
Estimated amortization period	3 years
Intangible assets				$ 60
Non-compete agreements \| Other 2019 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period				3 years
Intangible assets				$ 150
Non-compete agreements \| 2020 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period			3 years
Intangible assets			$ 90
Trade name \| 2018 Business Combinations
Business Acquisition [Line Items]
Intangible assets					1,540
Trade name \| San Diego Cash Register Company, Inc.
Business Acquisition [Line Items]
Estimated amortization period		5 years
Intangible assets					$ 1,340
Trade name \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period					5 years
Intangible assets					$ 200
Trade name \| 2019 Business Combinations
Business Acquisition [Line Items]
Intangible assets				2,040
Trade name \| Pace Payment Systems, Inc.
Business Acquisition [Line Items]
Estimated amortization period	5 years
Intangible assets				$ 500
Trade name \| Other 2019 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period				5 years
Intangible assets				$ 1,540
Trade name \| 2020 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period			3 years
Intangible assets			$ 300
Minimum \| Acquired merchant relationships \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period					12 years
Minimum \| Acquired merchant relationships \| Other 2019 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period				13 years
Minimum \| Acquired merchant relationships \| 2020 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period			15 years
Maximum \| Acquired merchant relationships \| Other 2018 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period					15 years
Maximum \| Acquired merchant relationships \| Other 2019 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period				20 years
Maximum \| Acquired merchant relationships \| 2020 Business Combinations
Business Acquisition [Line Items]
Estimated amortization period			18 years

Acquisitions - Pro Forma Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Business Combinations [Abstract]
Revenue(1)	$ 156,036	$ 383,546
Net (loss) income	$ (1,170)	$ 472

Property and Equipment, Net (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Property, Plant and Equipment [Line Items]
Accumulated depreciation	$ (2,996)	$ (1,944)
Property and equipment, net	5,339	5,026
Depreciation expense	1,825	1,195	$ 802
Computer equipment and software
Property, Plant and Equipment [Line Items]
Property and equipment	2,382	1,990
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment	1,867	1,639
Terminals
Property, Plant and Equipment [Line Items]
Property and equipment	584	429
Office equipment
Property, Plant and Equipment [Line Items]
Property and equipment	942	940
Automobiles
Property, Plant and Equipment [Line Items]
Property and equipment	$ 366	307
Estimated Useful Life	3 years
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment	$ 2,194	1,665
Computer Software
Property, Plant and Equipment [Line Items]
Property and equipment	$ 694	$ 674
Minimum \| Computer equipment and software
Property, Plant and Equipment [Line Items]
Estimated Useful Life	2 years
Minimum \| Furniture and fixtures
Property, Plant and Equipment [Line Items]
Estimated Useful Life	2 years
Minimum \| Terminals
Property, Plant and Equipment [Line Items]
Estimated Useful Life	2 years
Minimum \| Office equipment
Property, Plant and Equipment [Line Items]
Estimated Useful Life	2 years
Minimum \| Leasehold improvements
Property, Plant and Equipment [Line Items]
Estimated Useful Life	2 years
Maximum \| Computer equipment and software
Property, Plant and Equipment [Line Items]
Estimated Useful Life	7 years
Maximum \| Furniture and fixtures
Property, Plant and Equipment [Line Items]
Estimated Useful Life	7 years
Maximum \| Terminals
Property, Plant and Equipment [Line Items]
Estimated Useful Life	3 years
Maximum \| Office equipment
Property, Plant and Equipment [Line Items]
Estimated Useful Life	5 years
Maximum \| Leasehold improvements
Property, Plant and Equipment [Line Items]
Estimated Useful Life	7 years

Capitalized Software, Net (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Finite-Lived Intangible Assets [Line Items]
Amortization life	3 years
Accumulated amortization	$ (7,134)	$ (5,726)
Capitalized software, net	16,989	15,454
Software capitalized during the period	5,756	15,067
Amortization expense	3,978	2,977	$ 1,696
Software development costs
Finite-Lived Intangible Assets [Line Items]
Capitalized software	21,485	20,347
Development in progress
Finite-Lived Intangible Assets [Line Items]
Capitalized software	$ 2,638	$ 833
Minimum \| Software development costs
Finite-Lived Intangible Assets [Line Items]
Amortization life	1 year
Maximum \| Software development costs
Finite-Lived Intangible Assets [Line Items]
Amortization life	7 years

Goodwill and Intangible Assets - Changes in Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Goodwill [Roll Forward]
Goodwill, beginning	$ 168,284	$ 83,954
Goodwill attributable to preliminary purchase price adjustments and acquisition activity	18,721	84,330
Goodwill reassigned in segment realignment	0
Goodwill, ending	187,005	168,284
Merchant Services
Goodwill [Roll Forward]
Goodwill, beginning	117,334	70,936
Goodwill attributable to preliminary purchase price adjustments and acquisition activity	(933)	46,398
Goodwill reassigned in segment realignment	(419)
Goodwill, ending	115,982	117,334
Accumulated impairment losses			$ 11,458
Proprietary Software and Payments
Goodwill [Roll Forward]
Goodwill, beginning	50,950	13,018
Goodwill attributable to preliminary purchase price adjustments and acquisition activity	19,654	37,932
Goodwill reassigned in segment realignment	419
Goodwill, ending	71,023	50,950
Accumulated impairment losses			0
Other
Goodwill [Roll Forward]
Goodwill, beginning	0	0
Goodwill attributable to preliminary purchase price adjustments and acquisition activity	0	0
Goodwill reassigned in segment realignment	0
Goodwill, ending	$ 0	$ 0
Accumulated impairment losses			$ 0

Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	$ 166,639	$ 155,056
Finite-lived intangible assets, accumulated amortization	(57,448)	(47,673)
Finite-lived intangible assets, carrying value	109,191	107,383
Total identifiable intangible assets, cost	166,681	155,092
Total identifiable intangible assets, carrying value	$ 109,233	107,419
Amortization life	3 years
Amortization expense of intangible assets	$ 12,414	12,394	$ 9,341
Trademarks
Finite-Lived Intangible Assets [Line Items]
Indefinite-lived Intangible Assets	42	36
Merchant relationships
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	154,571	142,671
Finite-lived intangible assets, accumulated amortization	(53,388)	(43,579)
Finite-lived intangible assets, carrying value	$ 101,183	$ 99,092
Merchant relationships \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization life	12 years	12 years
Merchant relationships \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization life	20 years	20 years
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	$ 1,700	$ 1,770
Finite-lived intangible assets, accumulated amortization	(851)	(619)
Finite-lived intangible assets, carrying value	$ 849	$ 1,151
Non-compete agreements \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization life	3 years	2 years
Non-compete agreements \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization life	5 years	5 years
Website and brand development costs
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	$ 215	$ 77
Finite-lived intangible assets, accumulated amortization	(65)	(22)
Finite-lived intangible assets, carrying value	$ 150	$ 55
Amortization life		3 years
Website and brand development costs \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization life	3 years
Website and brand development costs \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization life	4 years
Trade names
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	$ 3,880	$ 4,292
Finite-lived intangible assets, accumulated amortization	(1,538)	(1,307)
Finite-lived intangible assets, carrying value	$ 2,342	$ 2,985
Trade names \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization life	3 years	3 years
Trade names \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization life	7 years	7 years
Residual buyouts
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	$ 5,373	$ 5,346
Finite-lived intangible assets, accumulated amortization	(1,172)	(1,882)
Finite-lived intangible assets, carrying value	$ 4,201	$ 3,464
Residual buyouts \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization life	2 years	2 years
Residual buyouts \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization life	8 years	8 years
Referral and exclusivity agreements
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, cost	$ 900	$ 900
Finite-lived intangible assets, accumulated amortization	(434)	(264)
Finite-lived intangible assets, carrying value	$ 466	$ 636
Referral and exclusivity agreements \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization life	5 years	5 years
Referral and exclusivity agreements \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization life	10 years	10 years

Goodwill and Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
2021	$ 11,645
2022	10,500
2023	9,428
2024	8,702
2025	8,495
Thereafter	60,421
Finite-lived intangible assets, carrying value	$ 109,191	$ 107,383

Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019
Accrued expenses and other current liabilities:
Accrued wages, bonuses, commissions and vacation	$ 3,867	$ 4,256
Accrued interest	141	254
Accrued contingent consideration — current portion	10,062	10,223
Escrow liabilities	4,363	1,414
Tax receivable agreement liability — current portion	0	24
Customer deposits	1,828	1,968
Other current liabilities	3,803	3,421
Accrued expenses and other current liabilities	24,064	21,560
Long-term Liabilities
Accrued contingent consideration — long-term portion	2,972	8,003
Deferred tax liability — long-term	2,212	516
Other long-term liabilities	956	605
Total other long-term liabilities	$ 6,140	$ 9,124

Long-Term Debt, Net - Summary of Long-term Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Feb. 18, 2020	Sep. 30, 2019
Debt Instrument [Line Items]
Debt issuance costs, net	$ (4,567)		$ (1,846)
Total long-term debt, net of issuance costs	90,758		139,298
Line of Credit \| Revolving lines of credit to banks under the Senior Secured Credit Facility
Debt Instrument [Line Items]
Long-term debt	0		141,144
Exchangeable Notes \| 1.0% Exchangeable Senior Notes due 2025
Debt Instrument [Line Items]
Long-term debt	95,325		$ 0
Stated interest rate (percent)		1.00%
Debt issuance costs, net	$ (3,193)

Long-Term Debt, Net - Additional Information (Details)					1 Months Ended		6 Months Ended	12 Months Ended
Long-Term Debt, Net - Additional Information (Details)	Feb. 18, 2020 USD ($) day $ / shares	Feb. 13, 2020 USD ($) shares	May 09, 2019 USD ($)	Oct. 31, 2017 USD ($)	Jun. 30, 2018 USD ($)	Jul. 31, 2017 USD ($) shares	Sep. 30, 2020 USD ($) $ / shares	Sep. 30, 2020 USD ($) $ / shares	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Jun. 25, 2018 USD ($)	Oct. 30, 2017 USD ($)	Sep. 30, 2017 USD ($) $ / shares	Dec. 31, 2014 USD ($) shares	Dec. 31, 2013 USD ($) creditor shares
Debt Instrument [Line Items]
Proceeds from borrowings on exchangeable notes								$ 138,000,000	$ 0	$ 0
Equity component of exchangeable notes, net of issuance costs and deferred taxes								27,578,000
Debt issuance costs incurred			$ 152,000
Debt issuance costs							$ 4,212,000	4,212,000	1,245,000
Amortization of deferred debt issuance costs								758,000	721,000	1,072,000
Debt issuance costs, net							4,567,000	4,567,000	1,846,000
Exchangeable notes, fair value							102,064,000	102,064,000
Repayments of convertible debt								17,414,000	0	0
Debt issuance cost write offs								141,000	152,000	0
Payments for note hedge transactions	$ 28,676,000							28,676,000	0	0
Proceeds from issuance of warrants								14,669,000	0	0
Conversion of notes payable to related and unrelated creditors to Class A common stock								0	$ 0	$ 8,054,000
1.0% Exchangeable Senior Notes due 2025
Debt Instrument [Line Items]
Repayments of convertible debt							17,414,000
1.0% Exchangeable Senior Notes due 2025 \| Exchangeable Notes
Debt Instrument [Line Items]
Original principal amount	$ 138,000,000
Stated interest rate (percent)	1.00%
Proceeds from borrowings on exchangeable notes	$ 132,762,000
Debt issuance costs incurred	5,238,000
Debt issuance costs	$ 4,150,000
Amortization of deferred debt issuance costs								365,000
Debt issuance costs, net							3,193,000	3,193,000
Debt aggregate repurchase amount							21,000,000	21,000,000
Debt interest, repurchase amount							24,000	$ 24,000
Loss on retirement of debt							2,297,000
Debt issuance cost write offs							$ 592,000
1.0% Exchangeable Senior Notes due 2025 \| Exchangeable Notes \| In Event of Fundamental Change
Debt Instrument [Line Items]
Repurchase price as percent of face value of notes (percent)	100.00%
1.0% Exchangeable Senior Notes due 2025 \| Exchangeable Notes \| February 20, 2023 to 47th Scheduled Trading Day Immediately Preceding the Maturity Date
Debt Instrument [Line Items]
Repurchase price as percent of face value of notes (percent)	100.00%
2020 Senior Secured Credit Facility \| Line of Credit
Debt Instrument [Line Items]
Revolving line of credit borrowing capacity			275,000,000
Optional addition to borrowing capacity			50,000,000
Unused commitment fee (percent)								0.30%
Debt covenant, minimum consolidated interest coverage ratio							3.00	3.00
Debt covenant, maximum total leverage ratio							5.00	5.00
Debt covenant, maximum consolidated senior secured leverage ratio							3.25	3.25
Debt covenant, increase to maximum consolidated senior secured leverage ratio during leverage increase period							0.25	0.25
Remaining borrowing capacity							$ 275,000,000	$ 275,000,000
Debt covenant, equity repurchase limit from employees, directors, officers or consultants			$ 3,000,000
Debt covenant, dividend or distribution limit as percent of net cash proceeds from additional common equity issuance (percent)			5.00%
2020 Senior Secured Credit Facility \| Line of Credit \| Minimum
Debt Instrument [Line Items]
Unused commitment fee (percent)			0.15%
2020 Senior Secured Credit Facility \| Line of Credit \| Maximum
Debt Instrument [Line Items]
Unused commitment fee (percent)			0.30%
2020 Senior Secured Credit Facility \| Line of Credit \| One, Two, Three or Six-Month LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate (percent)								3.25%
2020 Senior Secured Credit Facility \| Line of Credit \| One, Two, Three or Six-Month LIBOR \| Minimum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)			2.25%
2020 Senior Secured Credit Facility \| Line of Credit \| One, Two, Three or Six-Month LIBOR \| Maximum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)			3.25%
2020 Senior Secured Credit Facility \| Line of Credit \| Federal Funds Rate
Debt Instrument [Line Items]
Basis spread on variable rate (percent)			0.50%
2020 Senior Secured Credit Facility \| Line of Credit \| LIBOR Plus 1%
Debt Instrument [Line Items]
Basis spread on variable rate (percent)			1.00%					1.25%
2020 Senior Secured Credit Facility \| Line of Credit \| LIBOR Plus 1% \| Minimum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)			0.25%
2020 Senior Secured Credit Facility \| Line of Credit \| LIBOR Plus 1% \| Maximum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)			1.25%
2020 Senior Secured Credit Facility \| Line of Credit \| Letter of Credit \| Maximum
Debt Instrument [Line Items]
Unused commitment fee (percent)			3.25%
Term loans to bank under the Senior Secured Credit Facility \| Secured Debt
Debt Instrument [Line Items]
Original principal amount												$ 40,000,000
Senior Secured Credit Facility \| Line of Credit
Debt Instrument [Line Items]
Revolving line of credit borrowing capacity												$ 110,000,000
Quarterly principal payment				$ 1,250,000
Senior Secured Credit Facility \| Line of Credit \| Minimum
Debt Instrument [Line Items]
Unused commitment fee (percent)				0.15%
Senior Secured Credit Facility \| Line of Credit \| Maximum
Debt Instrument [Line Items]
Unused commitment fee (percent)				0.30%
Senior Secured Credit Facility \| Line of Credit \| Prime Rate \| Minimum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)				0.50%
Senior Secured Credit Facility \| Line of Credit \| Prime Rate \| Maximum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)				2.00%
Senior Secured Credit Facility \| Line of Credit \| 30-day LIBOR \| Minimum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)				2.75%
Senior Secured Credit Facility \| Line of Credit \| 30-day LIBOR \| Maximum
Debt Instrument [Line Items]
Basis spread on variable rate (percent)				4.00%
Notes payable to Mezzanine Lenders \| Notes Payable
Debt Instrument [Line Items]
Original principal amount															$ 10,500,000
Stated interest rate (percent)															12.00%
Debt issuance cost write offs					$ 78,000
Warrants outstanding (shares) \| shares															1,423,688
Warrants sold in connection with the issuance of the Exchangeable notes (in USD per share) \| $ / shares													$ 0.01
Number of creditors \| creditor															3
Intrinsic value of warrants											$ 9,241,000		$ 767,000
Junior Subordinated Notes \| Unsecured Debt
Debt Instrument [Line Items]
Original principal amount														$ 17,608,000
Stated interest rate (percent)														10.00%
Debt issuance cost write offs					43,000
Warrants outstanding (shares) \| shares														1,433,920
Extinguishment of debt, amount					8,054,000
Additional Paid-In Capital
Debt Instrument [Line Items]
Equity component of exchangeable notes, net of issuance costs and deferred taxes	$ 28,662,000							$ 27,578,000
Additional Paid-In Capital \| 1.0% Exchangeable Senior Notes due 2025 \| Exchangeable Notes
Debt Instrument [Line Items]
Debt issuance costs	$ 1,088,000
Common Stock \| Junior Subordinated Notes \| Unsecured Debt
Debt Instrument [Line Items]
Loss on retirement of debt						$ 0
Conversion of notes payable to related and unrelated creditors to Class A common stock						$ 500,000
Debt conversion, converted instrument, shares issued \| shares						148,000
Class A Common Stock
Debt Instrument [Line Items]
Exchangeable notes, exchange price per share (in USD per share) \| $ / shares	$ 40.87						$ 40.87	$ 40.87
Warrants outstanding (shares) \| shares		3,376,391
Warrants sold in connection with the issuance of the Exchangeable notes (in USD per share) \| $ / shares							$ 62.88	$ 62.88
Proceeds from issuance of warrants		$ 14,669,000
Class A Common Stock \| 1.0% Exchangeable Senior Notes due 2025 \| Exchangeable Notes
Debt Instrument [Line Items]
Exchangeable notes, exchange rate, shares per $1000	0.0244666
Class A Common Stock \| 1.0% Exchangeable Senior Notes due 2025 \| Exchangeable Notes \| February 20, 2023 to 47th Scheduled Trading Day Immediately Preceding the Maturity Date
Debt Instrument [Line Items]
Threshold exchange price as percent of closing price per share to allow redemption, (percent)	130.00%
Threshold trading days closing price for stock must exceed exchange price \| day	20
Class A Common Stock \| Common Stock
Debt Instrument [Line Items]
Conversion of notes payable to related and unrelated creditors to Class A common stock					$ 8,054,000

Income Taxes - Income Tax Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Current:
Federal tax (benefit) expense	$ (34)	$ 220	$ 668
State tax expense	446	189	351
Deferred:
Federal tax benefit	(3,018)	(487)	(685)
State tax (benefit) expense	(189)	(99)	3
Income tax (benefit) expense	$ (2,795)	$ (177)	$ 337

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Income Taxes - Income Tax Expense Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Expected U.S. federal income taxes at statutory rate (percent)	21.00%	21.00%	24.60%
Partnership income not taxed at federal level (percent)	(2.30%)	(260.90%)	(6.40%)
Valuation allowance (percent)	71.40%	65.00%	(20.90%)
State and local income taxes, net of federal benefit (percent)	(6.50%)	26.90%	(6.40%)
Nondeductible expenses and other permanent items (percent)	(13.10%)	150.80%	(1.40%)
Revaluation of debt and other debt transaction differences (percent)	(0.059)	(0.490)	(0.072)
Federal tax rate change (percent)	0.00%	0.00%	10.20%
Change in liability for uncertain tax positions (percent)	(2.90%)	0.00%	0.00%
Federal tax credit (percent)	11.40%	0.00%	0.00%
Other (percent)	0.90%	0.30%	0.10%
Income tax expense (percent)	74.10%	(45.90%)	(7.30%)
Effective Income Tax Rate Reconciliation, Amount [Abstract]
Expected U.S. federal income taxes at statutory rate	$ (792)	$ 81	$ (1,139)
Partnership income not taxed at federal level	85	(1,007)	294
Valuation allowance	(2,694)	251	965
State and local income taxes, net of federal benefit	244	104	295
Nondeductible expenses and other permanent items	496	582	66
Revaluation of debt and other debt transaction differences	222	(189)	332
Federal tax rate change	0	0	(471)
Change in liability for uncertain tax positions	108	0	0
Federal tax credits	(431)	0	0
Other	(33)	1	(5)
Income tax (benefit) expense	$ (2,795)	$ (177)	$ 337

Income Taxes - Deferred Tax Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019
Deferred tax assets:
Investment in partnership	$ 47,897	$ 40,880
Stock-based compensation	1,187	811
Deferred revenue	525	564
Accrued expenses	181	110
Net operating loss carryforwards	10,969	6,360
Section 163j carryforward	2,498	2,006
Federal tax credits	901	0
Other	73	42
Gross deferred tax assets	64,231	50,773
Valuation allowance	(20,230)	(16,609)
Deferred tax liabilities:
Intangible assets	(9,167)	(6,257)
Other	(291)	(285)
Net deferred tax asset	$ 34,543	$ 27,622

Income Taxes - Additional Information (Details) - USD ($)	3 Months Ended	12 Months Ended
	Sep. 30, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Jun. 25, 2018
Class of Stock [Line Items]
Benefit from deferred income taxes		$ (3,207,000)	$ (586,000)	$ (682,000)
Valuation allowance		20,230,000	16,609,000
Investment in partnership		47,897,000	40,880,000
Accrued interest related to uncertain tax positions		7,000	0
Accrued penalties related to uncertain tax positions		0	0
Unrecognized tax benefits		184,000	0
Percent of tax benefits payable to continuing equity owners					85.00%
Tax benefits retained (percent)					15.00%
Purchase of common units in i3 Verticals, LLC from selling unitholder	$ (4,635,000)	(5,080,000)	(12,077,000)	0
Deferred tax asset recognized		$ 64,231,000	50,773,000
Increase in net deferred tax assets			25,776,000
Increase tax receivable agreement liability			22,413,000
Period of payment to continuing equity owners		25 years
i3 Vericals, LLC
Class of Stock [Line Items]
Valuation allowance		$ 16,271,000
Change in valuation allowance for deferred tax assets		2,143,000
Investment in partnership		47,897,000
Minimum
Class of Stock [Line Items]
Expected payments for repurchase of redeemable noncontrolling interest		0
Maximum
Class of Stock [Line Items]
Expected payments for repurchase of redeemable noncontrolling interest		2,460,000
Continuing Equity Owner \| Class B Common Stock
Class of Stock [Line Items]
Deferred tax asset recognized	960,000	31,626,000	26,736,000	960,000
Tax benefits due to continuing equity owners	816,000	27,565,000	$ 23,229,000	$ 816,000
Increase in deferred tax assets		6,307,000
Increase tax receivable agreement liability		$ 5,361,000
Non-Controlling Interest
Class of Stock [Line Items]
Purchase of common units in i3 Verticals, LLC from selling unitholder	$ (4,635,000)
Common Stock \| Class B Common Stock
Class of Stock [Line Items]
Redemption of common units in i3 Verticals, LLC (shares)		(1,021,016)	(4,292,169)
Common Stock \| Class A Common Stock
Class of Stock [Line Items]
Redemption of common units in i3 Verticals, LLC (shares)		1,021,016	4,292,169
Federal
Class of Stock [Line Items]
Net operating loss carryforwards		$ 26,984,000
Tax credit carryforward		901,000
Benefit from deferred income taxes		6,568,000
Valuation allowance		388,000
Change in valuation allowance for deferred tax assets		383,000
State
Class of Stock [Line Items]
Net operating loss carryforwards		81,827,000
Benefit from deferred income taxes		5,302,000
Valuation allowance		3,571,000
Change in valuation allowance for deferred tax assets		$ 1,094,000

Income Taxes - Uncertain Tax Positions (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2020 USD ($)
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Gross unrecognized tax benefits as of September 30, 2019	$ 0
Increase in current year tax positions	108
Increase in prior year tax positions	76
Gross unrecognized tax benefits as of September 30, 2020	$ 184

Fair Value Measurements (Details) - USD ($) $ in Thousands	12 Months Ended
Fair Value Measurements (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Exchangeable notes, fair value	$ 102,064
Accrued Contingent Consideration
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning	18,226	$ 5,999
Contingent consideration accrued at time of business combination	4,748	13,032
Change in fair value of contingent consideration included in Operating expenses	(1,409)	3,389
Contingent consideration paid	(8,531)	(4,194)
Balance, ending	13,034	18,226
Accrued Expenses and Other Current Liabilities
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Contingent consideration	10,062	10,223
Other Long-term Liabilities
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Contingent consideration	$ 2,972	$ 8,003

Equity-Based Compensation (Details) - USD ($)		12 Months Ended
Equity-Based Compensation (Details) - USD ($)	Jun. 25, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation expense		$ 10,452,000	$ 6,124,000	$ 1,567,000
Income tax benefits related to equity-based compensation		604,000	160,000	0
TRA non-participation compensatory shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation expense	$ 741,000	0	0	741,000
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation expense		$ 10,452,000	$ 6,124,000	$ 826,000

Equity-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands		12 Months Ended
	Jun. 25, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	May 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation expense		$ 10,452	$ 6,124	$ 1,567
2018 Equity Incentive Award Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant under the plan (shares)		205,151			3,500,000
Additional Class A common shares added at the beginning of calendar year as percentage of common stock outstanding at end of previous year (percent)					4.00%
TRA non-participation compensatory shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation expense	$ 741	$ 0	$ 0	$ 741

Equity-Based Compensation - Fair Value of Stock Option Awards (Details) - Stock options	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility (percent)	28.50%	26.70%
Expected dividend yield (percent)	0.00%	0.00%
Expected term	6 years	6 years
Risk-free interest rate (percent)	1.20%	2.50%

Equity-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Stock Options
Outstanding at beginning of period (shares)	4,240,695
Granted (shares)	1,438,900
Exercised (shares)	(331,141)
Forfeited (shares)	(137,888)
Outstanding at end of period (shares)	5,210,566	4,240,695
Weighted Average Exercise Price
Outstanding at beginning of period, weighted average exercise price (in USD per share)	$ 21.73	$ 18.33
Granted, weighted average exercise price (in USD per share)	30.37
Exercised, weighted average exercise price (in USD per share)	15.85
Forfeited, weighted average exercise price (in USD per share)	21.56
Outstanding at end of period, weighted average exercise price (in USD per share)	21.73	$ 18.33
Granted, weighted average grant date fair value (in USD per share)	$ 9.07
Options exercisable at end of period (shares)	1,686,957
Unrecognized compensation expense related to unvested options at end of period	$ 18,620
Period for recognition of unrecognized compensation cost	1 year 10 months 24 days
Fair value of stock options that vested	$ 8,100

Stockholders' / Members' Equity and Redeemable Class A Units (Details)		12 Months Ended
	Jun. 25, 2018 USD ($) $ / shares shares	Sep. 30, 2017 USD ($) $ / shares shares	Sep. 30, 2020 vote $ / shares shares	Feb. 13, 2020 shares	Sep. 30, 2019 $ / shares shares
Class of Stock [Line Items]
Preferred Stock authorized (shares)	10,000,000		10,000,000		10,000,000
Preferred Stock, par value (in USD per share) \| $ / shares	$ 0.0001		$ 0.0001		$ 0.0001
Common Stock, number of votes per share \| vote			1
Mezzanine Warrants
Class of Stock [Line Items]
Warrants outstanding (shares)		1,423,688
Unsecured Debt \| Junior Subordinated Notes
Class of Stock [Line Items]
Warrants outstanding (shares)		1,433,920
Intrinsic value of warrants \| $		$ 0
Warrant exercise price (in USD per share) \| $ / shares		$ 2.095
IPO
Class of Stock [Line Items]
Shares issued (shares)	7,647,500
Class A Common Stock
Class of Stock [Line Items]
Common Stock authorized (shares)	150,000,000		150,000,000		150,000,000
Common Stock, par value (in USD per share) \| $ / shares	$ 0.0001		$ 0.0001		$ 0.0001
Conversion ratio			1
Conversion ratio, number of shares used to value cash payment (in shares)			1
Units issued (shares)		13,892,129
Units outstanding (shares)		13,892,129
Cumulative preferred return \| $	$ 7,627,000	$ 5,105,000
Distributions to unit holders \| $		$ 625,000
Common Stock issued (shares)			18,864,143		14,444,115
Common Stock, outstanding (shares)			18,864,143		14,444,115
Warrants outstanding (shares)				3,376,391
Warrant exercise price (in USD per share) \| $ / shares			$ 62.88
Class B Common Stock
Class of Stock [Line Items]
Common Stock authorized (shares)	40,000,000		40,000,000		40,000,000
Common Stock, par value (in USD per share) \| $ / shares	$ 0.0001		$ 0.0001		$ 0.0001
Conversion ratio			1
Common Stock issued (shares)			11,900,621		12,921,637
Common Stock, outstanding (shares)			11,900,621		12,921,637
Redeemable Class A Units
Class of Stock [Line Items]
Units issued (shares)		4,900,000
Units outstanding (shares)		4,900,000
Annual preferred return rate (percent)		10.00%
Cumulative preferred return \| $	$ 3,376,000	$ 2,823,000
Distributions to unit holders \| $		$ 131,000
Common Stock
Class of Stock [Line Items]
Common Stock issued (shares)		1,548,722
Common Stock, outstanding (shares)		1,548,722
Restricted Class P Units
Class of Stock [Line Items]
Common Stock issued (shares)		7,647,350
Common Stock, outstanding (shares)		7,647,350

Commitments and Contingencies - Operating Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Operating leases for office space and equipment	$ 2,820	$ 2,302	$ 1,555
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2021	2,726
2022	2,397
2023	2,096
2024	1,469
2025	968
Thereafter	1,221
Total	$ 10,877

Commitments and Contingencies - Minimum Fee Commitments (Details) $ in Thousands	Sep. 30, 2020 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2021	$ 3,334
2022	2,818
2023	2,645
2024	450
2025	0
Thereafter	0
Total	$ 9,247

Commitments and Contingencies - Loan Commitment (Details) - Third Party Sales Organization - USD ($) $ in Thousands	Oct. 20, 2020	Sep. 30, 2020
Loan Commitment
Other Commitments [Line Items]
Loan commitment for fiscal year 2021		$ 3,500
Loan Commitment \| Subsequent Event
Other Commitments [Line Items]
Commitments to third party sales organization	$ 3,500
Buyout Commitment \| Subsequent Event
Other Commitments [Line Items]
Commitments to third party sales organization	29
Additional Buyout Consideration \| Subsequent Event
Other Commitments [Line Items]
Commitments to third party sales organization	$ 9

Related Party Transactions (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Jun. 30, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Jun. 25, 2018	Sep. 30, 2017
Related Party Transaction [Line Items]
Sale of Class A common stock in initial public offering, net		$ 0	$ 0	$ 8,054
Percent of tax benefits payable to continuing equity owners					85.00%
Class B Common Stock \| Continuing Equity Owner
Related Party Transaction [Line Items]
Tax benefits due to continuing equity owners		$ 27,565	23,229	816
Common Stock \| Class A Common Stock
Related Party Transaction [Line Items]
Sale of Class A common stock in initial public offering, net	$ 8,054
Affiliated Entity \| Chief Executive Officer
Related Party Transaction [Line Items]
Ownership interest in Axia Tech (percent)		10.50%
Affiliated Entity \| Chief Financial Officer
Related Party Transaction [Line Items]
Ownership interest in Axia Tech (percent)		0.40%
Affiliated Entity \| Axia Med
Related Party Transaction [Line Items]
Net revenue from related party		$ 95	$ 81	53
Affiliated Entity \| i3Verticals, LLC
Related Party Transaction [Line Items]
Ownership interest in Axia Tech (percent)		2.00%
Affiliated Entity \| Conversion of Related Party Debt \| Common Stock \| Class A Common Stock
Related Party Transaction [Line Items]
Sale of Class A common stock in initial public offering, net	924
Junior Subordinated Notes \| Unsecured Debt \| Affiliated Entity
Related Party Transaction [Line Items]
Notes payable, related parties						$ 6,158
Related party interest expense				457
Junior Subordinated Notes \| Unsecured Debt \| Affiliated Entity \| Repayment of Debt
Related Party Transaction [Line Items]
Debt repaid with proceeds from the company's IPO	$ 5,234
Notes Payable \| Affiliated Entity
Related Party Transaction [Line Items]
Notes payable, related parties						$ 10,500
Related party interest expense				$ 952

Segments (Details) - USD ($)
$ in Thousands

3 Months Ended

12 Months Ended

Sep. 30, 2020

Jun. 30, 2020

Mar. 31, 2020

Dec. 31, 2019

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Dec. 31, 2018

Sep. 30, 2020

Sep. 30, 2019

Sep. 30, 2018

$ 38,272

$ 31,573

$ 39,178

$ 41,111

$ 108,562

$ 97,483

$ 85,394

$ 84,868

$ 150,134

$ 376,307

$ 323,508

242,867

^[1]

214,543

^[1]

47,230

44,237

40,314

78,323

62,860

40,585

18,217

16,564

11,839

(1,409)

3,389

3,866

1,198

$ 437

$ 2,041

$ 4,097

1,869

$ 1,194

$ (203)

$ 3,530

7,773

6,390

12,361

123,352

106,866

83,180

403,526

349,302

403,526

349,302

175,142

187,005

168,284

187,005

168,284

83,954

Merchant Services

100,949

338,968

303,692

236,170

209,705

43,940

41,487

38,563

26,376

27,275

23,716

11,796

12,221

9,736

(4,691)

(477)

2,103

23,528

22,292

19,869

78,627

78,369

69,449

206,769

216,420

206,769

216,420

143,792

Proprietary Software and Payments

115,982

117,334

115,982

117,334

70,936

Residual expense

21,618

17,058

14,025

50,953

37,339

19,819

6,697

4,838

5,057

2,750

1,752

28,187

17,059

7,177

5,723

3,790

1,896

3,282

3,866

1,763

8,704

3,177

2,393

46,483

28,497

13,733

139,107

99,420

139,107

99,420

26,524

71,023

50,950

71,023

50,950

13,018

Residual expense

587

605

504

Other

(1,768)

(3)

(1,767)

(1)

23,760

18,526

9,692

698

553

207

(24,459)

(19,079)

(9,901)

(1,758)

(2)

57,650

33,462

57,650

33,462

4,826

Less: Net (loss) income attributable to non-controlling interests

$ 0

Residual expense

$ (1,757)

$ 0

[1]

Non-Controlling Interest - Narrative (Details) - i3Verticals, LLC - shares	Sep. 30, 2020	Sep. 30, 2019
Noncontrolling Interest [Line Items]
Non-controlling interest, common units (shares)	18,864,143	14,444,115
Non-controlling interest, ownership interest (percent)	61.30%	52.80%

Non-Controlling Interest - Impact on Equity (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Sep. 30, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Noncontrolling Interest [Abstract]
Net (loss) income attributable to non-controlling interest		$ (560)	$ 3,608	$ 1,937
Allocation of equity to non-controlling interests arising from the reorganization transactions and IPO		0	0	70,960
Distributions to non-controlling interest holders		(3)	(2,060)	0
Redemption of common units in i3 Verticals, LLC	$ (4,635)	(5,080)	(12,077)	0
Adjustment related to prior periods		2,730	0	0
Cumulative effect of adoption of new accounting standard		640	0	0
Allocation of equity to non-controlling interests		24,495	0	0
Net transfers to (from) non-controlling interests		22,782	(14,137)	70,960
Change from net income attributable to non-controlling interests and transfers to (from) non-controlling interests		$ 22,222	$ (10,529)	$ 72,897

Earnings Per Share - Basic (Details) - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

9 Months Ended

12 Months Ended

Sep. 30, 2020

Jun. 30, 2020

Mar. 31, 2020

Dec. 31, 2019

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Dec. 31, 2018

Sep. 30, 2018

Jun. 25, 2018

Sep. 30, 2020

Sep. 30, 2019

Sep. 30, 2018

Numerator

Net (loss) income

$ 2,673

$ (979)

$ 563

$ (4,961)

(560)

3,608

1,937

Net loss attributable to i3 Verticals, Inc.

$ (651)

$ (356)

$ 737

$ (149)

$ (930)

$ (1,191)

$ (1,102)

$ 178

$ (7,634)

$ (419)

$ (3,045)

$ (6,898)

Basic net (loss) income per share (in USD per Share)

$ (0.04)

$ (0.02)

$ 0.05

$ (0.01)

$ (0.07)

$ (0.12)

$ 0.02

$ (0.03)

^[1]

$ (0.29)

^[1]

$ 0.08

^[1]

Class A Common Stock

Numerator

Net (loss) income

$ (979)

$ 563

$ 2,673

Less: Net (loss) income attributable to non-controlling interests

(560)

3,608

1,937

Net loss attributable to i3 Verticals, Inc.

$ (419)

$ (3,045)

$ 736

Weighted average shares of Class A common stock outstanding (shares)

14,833,378

10,490,981

8,812,630

[1]	Basic and diluted net income per share of Class A common stock are presented only for the period after the Company’s Reorganization Transactions. See Note 1 for a description of the Reorganization Transactions. See Note 18 for the calculation of income per common share.

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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Reference 20: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 55
-Paragraph 4K
-URI http://asc.fasb.org/extlink&oid=120409616&loc=SL4591552-111686

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22658-107794

Net (loss) income attributable to Class A common stockholders

Earnings Per Share - Diluted (Details) - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

9 Months Ended

12 Months Ended

Sep. 30, 2020

Jun. 30, 2020

Mar. 31, 2020

Dec. 31, 2019

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Dec. 31, 2018

Jun. 25, 2018

Sep. 30, 2020

Sep. 30, 2019

Sep. 30, 2018

Numerator

$ (651)

$ (356)

$ 737

$ (149)

$ (930)

$ (1,191)

$ (1,102)

$ 178

$ (7,634)

$ (419)

$ (3,045)

$ (6,898)

Weighted average shares of Class A common stock outstanding - diluted (shares)

^[1]

27,429,801

10,490,981

26,873,878

Diluted net (loss) income per share (in USD per share)

$ (0.06)

$ (0.02)

$ 0.05

$ (0.01)

$ (0.07)

$ (0.12)

$ 0.02

$ (0.03)

^[2]

$ (0.29)

^[2]

$ 0.08

^[2]

Class A Common Stock

Numerator

Net (loss) income attributable to Class A common stockholders

$ (419)

$ (3,045)

$ 736

Reallocation of net (loss) income assuming conversion of common units

(422)

1,464

Net (loss) income attributable to Class A common stockholders - diluted

$ (841)

$ 2,200

Weighted average shares of Class A common stock outstanding (shares)

14,833,378

10,490,981

8,812,630

Weighted average effect of dilutive securities (shares)

12,596,423

18,061,248

Weighted average shares of Class A common stock outstanding - diluted (shares)

27,429,801

26,873,878

Diluted net (loss) income per share (in USD per share)

$ 0.08

[1]	Effective October 1, 2019, the Company's revenues are presented net of interchange and network fees in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers. See Note 2 to our consolidated financial statements for a description of the recently adopted accounting pronouncement.
[2]	Basic and diluted net income per share of Class A common stock are presented only for the period after the Company’s Reorganization Transactions. See Note 1 for a description of the Reorganization Transactions. See Note 18 for the calculation of income per common share.

Earnings Per Share - Antidilutive Securities (Details) - $ / shares	3 Months Ended								12 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Feb. 18, 2020
Class A Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Exchangeable notes, exchange price per share (in USD per share)	$ 40.87								$ 40.87			$ 40.87
Warrant exercise price (in USD per share)	$ 62.88								$ 62.88
Restricted Class A Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	94,577	193,709	215,564	232,828	271,881	285,433	277,758	295,405	204,969	282,801	299,412
Class B Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)		12,404,368	12,769,568	12,921,637	12,921,637	16,184,026	17,112,164	17,213,806		15,856,855
Out-of-the-money Options \| Class A Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	1,297,500	1,498,000	959,000	689,500	446,000	443,000	30,500	754,750	1,327,500	626,500
Stock options \| Class A Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	1,225,697	1,127,509		976,594	1,131,760	1,188,987	1,012,916		1,179,538	1,009,858

Significant Non-cash Transactions (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Jun. 25, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018
Other Significant Noncash Transactions [Line Items]
Equity issued as part of acquisitions' purchase consideration		$ 0	$ 0	$ 104
Acquisition date fair value of contingent consideration in connection with business combinations		4,748	13,032	2,084
Replacement of prior senior secured credit facility with senior secured credit facility		0	100,229	87,525
Mezzanine Notes net settled with Mezzanine Warrant exercises		0	0	14
Unsecured notes payable to related and unrelated creditors net settled with Junior Subordinated Notes Warrants		0	0	2,565
Settlement of warrant liability with equity as a result of Mezzanine Warrant exercise		0	0	9,253
Preferred return on redeemable class A units and class A units	$ 0
Debt issuance costs financed with proceeds from senior secured credit facility		0	1,271	904
Conversion of notes payable to related and unrelated creditors to Class A common stock		0	0	8,054
Redeemable Class A Common Stock
Other Significant Noncash Transactions [Line Items]
Preferred return on redeemable class A units and class A units		0	0	552
Class A Common Stock
Other Significant Noncash Transactions [Line Items]
Preferred return on redeemable class A units and class A units		0	0	2,522
Restricted Class A Common Stock
Other Significant Noncash Transactions [Line Items]
Equity issued as part of acquisitions' purchase consideration		$ 0	$ 225	$ 550

Quarterly Information (Unaudited) (Details) - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

9 Months Ended

12 Months Ended

Sep. 30, 2020

Jun. 30, 2020

Mar. 31, 2020

Dec. 31, 2019

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Dec. 31, 2018

Jun. 25, 2018

Sep. 30, 2020

Sep. 30, 2019

Sep. 30, 2018

Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]