What we look for when a software company adds AI features or embedded payments.

AI features: four questions, in the records

• Paid adoption. How many customers pay for the feature as a separate line, how many have it bundled at no change in price, and how many have it switched on without using it. The invoice and the usage log answer this, not the product roadmap.
• Customer retention. Whether the customers who adopted the feature renew at a different rate from those who did not, measured on the same cohort over the same period. A retention claim for a feature launched nine months ago is a claim about nine months.
• Cost to deliver. The inference and model costs behind the feature, by customer and by month, against the price charged for it. A feature sold at a flat fee with a usage-based cost behind it has a margin that moves with adoption.
• Earnings contribution. Whether the feature’s revenue, net of its cost to deliver, reaches adjusted earnings, or whether it is reported as growth while its cost sits in cost of revenue or in capitalized development.

Embedded payments: the activity must reconcile

• Payment activity. The volume processed through the platform, by month, from the processor’s statements rather than the company’s dashboard.
• Reconciled revenue. The company’s share of that volume, reconciled from the processor’s remittances to the general ledger to the bank. Gross and net presentation decide whether the revenue line is the volume or the margin on it.
• Delivery economics. Interchange, processor fees, chargebacks and reserves, so that the margin on payments is read after the costs that attach to it.
• Contract exposure. The processor agreement’s term, exclusivity, pricing resets and change-of-control terms, and the customer agreements’ consent to payment processing. A payments line is only as durable as the agreement it runs on.

Why this is diligence work and not a product question

Both lines arrive in a sale process as growth stories, and both are priced on the story unless someone traces them. The trace is the same one a buyer’s quality of earnings team will run in the sixth week of exclusivity: the invoice, the usage log, the processor statement, the ledger and the bank. Capital Row runs it before the letter of intent, for a buyer who has the company in view, or for an owner who wants to know what the buyer will find.