Alchemy Technology (ALKT) Q1 2025: Mantle Drives 11-Point RPO Lift, Accelerating Cross-Sell Opportunity
Mantle, digital account opening platform, delivered an outsized impact on Alchemy’s backlog and RPO growth, quickly integrating into sales motions and unlocking new cross-sell leverage. Management’s confidence in balanced demand across banks and credit unions, coupled with high attach rates for add-ons, signals a structurally expanding addressable market. With digital transformation spend holding firm and integration hurdles low, Alchemy is positioned to widen its competitive gap as Mantle’s pipeline converts.
Summary
- Mantle Integration Accelerates Cross-Sell: Early traction with five cross-sell wins and rapid backlog contribution.
- Balanced Demand Profile Emerges: Both banks and credit unions show strong appetite for digital onboarding solutions.
- Visibility Into Digital Spend Remains High: Mission-critical nature of digital banking shields budgets from macro pressure.
Performance Analysis
Alchemy’s Q1 was defined by the rapid integration and impact of Mantle, its digital account opening acquisition, which contributed a significant step-up to backlog and drove an 11 percentage point increase in year-over-year RPO (Remaining Performance Obligations, a forward revenue metric). The company signed eight contracts in the quarter, with half being renewals—a dynamic that underpinned organic RPO growth of 20 percent, while Mantle’s addition provided the remainder of the RPO uplift. Notably, Mantle now represents approximately 50 institutions in backlog, demonstrating immediate cross-sell velocity and reflecting a higher average revenue per user (RPU) compared to legacy add-on products.
Demand remained robust across both banks and credit unions, with Mantle’s product suite resonating equally in both segments. Banks in the backlog command a higher RPU, but credit unions are strategically important as their aging member base drives urgency to modernize digital experiences. The average Mantle RPU contribution this quarter was $1.80, with management expecting a normalized 7 to 8 percent growth rate going forward. Alchemy’s attach rate for add-ons like Segment and ACH Alert continues to hover around 70 to 80 percent on new logo wins, and Mantle is expected to approach or surpass these levels due to its broader applicability and established go-to-market.
- Mantle’s Backlog Impact: The acquisition drove a material sequential backlog increase, with 36 new customers (16 banks, 20 credit unions) and 50 Mantle institutions in total backlog.
- Organic Growth Maintained: Core business delivered 20 percent organic RPO growth, with no outsized renewals or pull-forwards distorting results.
- High Add-On Attachment: Segment and ACH Alert add-ons maintain 70 to 80 percent attachment rates, supporting higher deal values and win rates.
Alchemy’s market share gains remain outsized relative to peers, with third-party data (FI Navigator) confirming leading digital user growth among the top five competitors. Management’s commentary and analyst Q&A reinforce that digital transformation budgets remain insulated, and pipeline conversions are not seeing delay or scope reduction despite a cautious macro backdrop.
Executive Commentary
"Mantle had five transactions that they sold into the Alchemy base. And what's exciting for us is that's really before we start to put in the effort to do all of the account planning work, the account profiling work, getting the sales teams working together on pursuits. And so that initial success, along with the progress that we're seeing internally, provides us a lot of confidence in the cross-selling opportunity within the base."
Alex Schuttman, CEO
"Mantle carries a much higher average ARR than both of those solutions. And we feel that we can achieve somewhere close to the segment attachment rate. So when you think in terms of deal value, you know, a couple of things should happen. We should see a higher deal value. And then with these mantle differentiation, we should also start experiencing a bit higher win rate on new logo."
Brian Hill, Departing CFO
Strategic Positioning
1. Cross-Sell Leverage With Mantle
Mantle’s integration is already showing tangible cross-sell results, with five deals into the existing base before full sales alignment and account planning are even underway. Management expects Mantle to follow a trajectory similar to the Segment acquisition, which now features in 70 percent of new logo transactions, but with a faster ramp due to overlapping buyer personas and Mantle’s established go-to-market.
2. Balanced Market Demand Across Segments
Demand for Mantle’s digital onboarding spans both banks and credit unions, with demographic pressures on credit unions (aging member base) creating a structural tailwind for adoption. Both retail and commercial use cases are addressed, and the company is well positioned to capture a broad swath of the market as digital expectations rise.
3. Add-On Sales as a Structural Growth Driver
Alchemy’s long-term business model targets 50 percent of new ARR from add-ons, including Mantle, Segment, and ACH Alert. High attach rates on new logo wins and the higher deal value of Mantle suggest this mix will continue to trend up, supporting durable revenue growth and improved customer lifetime value.
4. Defensible Position in Digital Transformation Budgets
Despite macroeconomic caution, digital banking remains a mission-critical spend category for financial institutions, with contracts often running five to seven years and implementation timelines locked in well ahead of go-live. Management reports that while banks are cutting discretionary projects, digital banking upgrades are not being delayed or deprioritized.
5. Integration and Execution Strength
Mantle’s integration presents low technical and operational risk, with substantial progress already made in core provider integration and go-to-market alignment. The combined platform is positioned to deliver a differentiated customer experience, raising win rates against incumbents and enabling regional players to compete with digital-first challengers.
Key Considerations
This quarter marked a strategic inflection as Alchemy’s acquisition of Mantle rapidly translated into backlog growth and cross-sell momentum, while the core business maintained strong organic expansion. The company’s ability to sustain high add-on attachment rates, balanced demand across customer segments, and a robust pipeline conversion cadence underpins its defensible growth trajectory.
Key Considerations:
- Backlog Quality and Conversion: Mantle’s 50 institutions in backlog represent a near-term revenue catalyst as implementations go live.
- Attach Rate Sustainability: The ability to maintain or improve 70 to 80 percent add-on attachment rates will be critical for deal value and margin expansion.
- Competitive Win Rate: As more bank customers go live, referenceability increases, lowering switching friction and boosting win rates against legacy incumbents.
- Integration Execution: Management’s confidence in Mantle’s integration is high, but continued progress on platform unification and sales alignment will determine the speed of synergy realization.
Risks
While digital banking remains insulated from near-term budget cuts, a severe macroeconomic or regulatory shock could still disrupt implementation timelines or force a reprioritization of spend. Mantle’s product development in loan origination systems (LOS) is still in progress, and broader market rollout is contingent on successful pilot outcomes. Leadership transitions—including the CFO’s planned departure—add a layer of execution risk, though management emphasizes a robust transition plan and deep bench strength.
Forward Outlook
For Q2 2025, Alchemy guided to:
- Continued organic ARR growth in the low-20 percent range
- Steady backlog conversion and high attach rates for Mantle, Segment, and ACH Alert
For full-year 2025, management maintained guidance:
- 50 percent of new ARR from add-ons, with Mantle a key contributor
Management highlighted several factors that will shape the outlook:
- Balanced demand across banks and credit unions, with demographic tailwinds for credit unions
- Digital transformation remains a protected budget category, with no signs of pipeline slowdown
Takeaways
Alchemy’s Q1 performance underscores the strategic value of Mantle, both as a cross-sell engine and as a catalyst for backlog and RPO growth. The company’s defensible positioning in digital banking, high add-on attachment rates, and balanced market demand provide a solid foundation for continued share gains.
- Mantle’s rapid impact: Immediate backlog and RPO lift, with integration risk low and cross-sell opportunity just beginning to unlock.
- Resilient demand environment: Digital banking remains a non-negotiable spend, with contracts and implementation timelines largely insulated from macro uncertainty.
- Execution watchpoint: Investors should monitor the pace of Mantle backlog conversion, attach rate trends, and the impact of leadership transitions on operational continuity.
Conclusion
Alchemy’s Q1 2025 results demonstrate a business accelerating on multiple fronts, with Mantle’s integration already driving material financial and strategic benefits. As the company executes on cross-sell and backlog conversion, its differentiated position in digital transformation spend is likely to widen.
Industry Read-Through
Alchemy’s results reinforce that digital onboarding and account opening remain top priorities for banks and credit unions, even as broader IT budgets come under scrutiny. The rapid cross-sell integration and high attach rates for add-ons signal a broader industry shift toward bundled digital solutions and platform consolidation. Vendors that can deliver seamless integration and referenceable customer outcomes are positioned to capture outsized share as legacy financial institutions race to modernize. The resilience of digital transformation spend, despite macro uncertainty, is a bullish read-through for fintech enablers and enterprise SaaS providers targeting regulated verticals.