Blackbaud (BLKB) 31 Jul 192019 Q2 Earnings call transcript

Good day, and welcome to the Blackbaud Inc.

Second Quarter 2019 Earnings Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Mr. Mark Furlong. sir. ahead, go Please

in Thanks call. us our Today, and our operational everyone. growth our quarter strategy. financial Blackbaud's XXXX results performance on commentary earnings we provide context for morning, of on four-point joining second and the Good will review

the for are and Tony and line me up questions. and prepared Blackbaud's comments CEO; we Mike will President will the Mike on Joining Boor, and Blackbaud's CFO. Gianoni, and then open Tony your Executive call today Vice President make

Please GAAP actual contain other risks and most note projected. forward-looking statements and we uncertainties are representative our this our will measures comments information on those XX-K call. that today differ measure risks. internally refer We SEC financial believe those subject filings that otherwise non-GAAP results from both only to Form to could materially of more and for specified, how that on business. of refer cause more our Please recent to Unless a non-GAAP we to measures combination

not we a GAAP schedule presentation is non-GAAP from substitution available a Please note of as or night last our press measures on for supplemental Relations isolation in be A the release in and financial Investor non-GAAP considered available GAAP more reconciliation results our detailed issued and measures. that is should in website.

Relations our Before over Investor Mike, marketing investor upcoming cover which I activity, call available briefly the our website. turn I'll is on to

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Mike. turn call over I'll the to that, With

today. call joining everyone. thanks morning, Thanks, Mark. And for our Good

With our digital software first across full I'm continue helping realize drive our a the two and pleased with drive vertical the behind transformation enabling serve. markets the specific impact customers in outcomes XXXX We're innovation, customers potential. we us, around as organizations deliver progress position, unique world enabling our quarters to we of to and their

our our to Last week dedication world marked which as have shareholder public XXth we driving a year a and building a incredible company, in while is value. team the testament better

over was XX a the or X,XXX We sit since their of an whom has mission on increased over board employees, nearly half have factor say nonprofit Blackbaud's in important a volunteerism of say joining out Blackbaud. Nine global XX% and joining workforce of committee. company

over an culture mission-driven efforts. and This ahead public past as to accomplished asset solutions and only for to a it's of new recruiting the but what incredible proud we've as innovation customer are years we satisfaction, our XX applications market. And existing bring company. not what's we drives by also rapidly advance We're our energized continue

unchanged outlook second reaffirming full-year we are XXXX our the into Heading our financial is guidance. half, full-year and

of more provide growth the I'll and our detail will Tony an on on update our usual, As context results, provide strategy. four-point

automate that The solve we integrated customers first specific business serve The require of strategies open integrated rebuild in solutions business cloud solutions our solutions four purpose-built our and is to vertical operations cloud. these their needs. and

part Faith experience. the their a for day-to-day Cloud against strategy, of execution Church Communities, Solution digitally developed connected our of example Management, operations single the churches transform to enabling we Blackbaud through an As

for robust to platform, optimize churches our technology to insight working into their specifically been their to need that the with continue gain to incorporate additional capabilities be and already needs. We've successful, feedback

a mobile from stands as to out solution heard intuitive use user our and that easy our Early have with We experience. Adopter Customers responsive

from this capabilities is Cloud platform. Blackbaud scale, This Bringing also a and Communities substantial the by SKY experience all powered expect integrated availability is for can which Blackbaud is significant their Blackbaud. add Faith and solution through the market on Solution initiative other a needs addressing step one as to general major we toward church to several announce challenges track soon. for Churches opportunity in market

net fully cloud about early hundred This in and transaction around platform momentum to campaigns. creating March, there for the best-in-class signed across peer-to-peer opportunity It's The market of it. marketplace like Blackbaud. customers active providing which launch Solution. growing majority the our is by really building US also up, is And integrated fundraising portfolio days note excited Blackbaud's solution of the in a unique and powered the best-in-class JustGiving. number Since isn't solution, peer-to-peer new have the are payment we're Cloud several I'll by this another disrupt landscape is customers

is Turning to strategy, our effectiveness. second drive growth which to sales

have overall our salespeople and to know, way in now we simplify our methodology better to is are improving enable additional sales focused worked transformation structure The success. headcount largely on productivity. As for our sales you sales a uniform laser and program, done and we refine approach adding

an year as level on vertical we continuation those And sales across the after Our for update of a plan go hiring markets. large have opportunities our this calls in investments. heightened Tony will we the provide

reoccurring selling higher lifetime revenue value. customer for and total to continue vertical, solution driving ASPs focused customer, lead and increased overall more products executives account on Our by the

for Selling customers. comprehensive translates cloud to solutions real our value

selected exceeding teachers, a number spent first systems goal undertook example, factor, a United in parents". integration as maintenance For provide students create mind, Texas, digits, base time quote, alumni Blackbaud training School for XXX on over the our evaluation less recently to interact ancillary given They consolidate with a the process Stephen's students data enrolled one evaluation ultimately well also to into open vendor differentiating Episcopal software because tight to Austin, vendor XX the countries project Episcopal as our and list less and I With X,XXX. services. in to as States. the students parents time with exhaustive use systems co-educational St. from and APIs that double a spent "fewer the in of School synchronization partners St. means on school, critical Stephen's and reaching After with highlighted

continue to market, also our advance rapidly applications more. bring to sell teams our sales existing enabling solutions to to new We

we've higher functionality, vertical manage cloud is where to Our provide our up proven one K-XX education a us great with solutions example advanced schools to complete solutions we the private significantly extended market, enabling to information, cycle, early engagement from unique one student platform. inside the traction. and and life pleased with This in student admissions, cloud the market all more, been end higher is alumni

year our products. portfolio customers or this signing more education management purchase for four In fact, the majority of up

to which turn now third expansion. I'll TAM our is strategy,

We social January been acquisition continue our of YourCause offering, of this inclusion to in have industry-leading a corporate efficiencies be space. this in past that business unique excited puts and to never which their responsibility the drive seen position connectivity about the increased and

As back-office significant Philadelphia moved are fast efforts. help responsibility. of the like you corporate institutions might of ahead all as customer the expect, This their trend new NHL and XXers, selected has on philanthropic to the integration well we who who power us, Blackbaud focusing customers focused which sizes, and the we in and up as organizations recently fantastic YourCause is a signing their as base, with existing Foundation our opportunity on business given of the is social reflected

the we ed note, served and healthcare companies And institutions. extends just this I'll opportunity markets already like and beyond higher

development. market Our and TAM total in acquisitions billion, active evaluation to $XX through we further stands addressable our currently product internal of over and remain at opportunities the expand

success. initiative is strategic productivity and more scalable to on for the how long-term Our execute final operational infrastructure entire and focus and business to spans creates efficiency, consistency we strength continuous operating through that we organization toward as This the effort position organizational model drive alignment. investments, initiatives us on efficiency a

global hiring. years with the is heightened An investment we model in in creating to dealt scalability program are sales account efficiently, our spent several operating executives in designing excellent example one sales recent mind. while enable We our also more sales last

team the we a us just have our recruit years train sales in operating enables that trust way Our model a and of couldn't efficiently growing to progress ago. sales hire, few done

the XX% now revenue, XXXX. toward Overall, in of second the ahead opportunity I'm quarter, recurring us with our at and which our execution revenue through pleased stands total continued shift

to to deliver us outlook Our customers. we our unchanged. financial is enabling strengthening our specific for And continuing against strategic execute innovation plan, are full-year more business, which the is

now open I'll turn before to financial to for cover our the Tony call detail performance over it Q&A. up greater in we

Tony?

investor to refer highlights on our Thanks, Today, press Mike. for the so to posted website questions. everyone. yesterday's detail your of Please the to and key get I'll focus full performance. QX our materials financial can morning, we release Good

of recurring quarter mix our revenue One-time XX% increased healthy an Recurring XXXX a X% organic nearly see as to $X is mentioned, our QX over total X% an continue on quarter, million XXXX. shift XX% services which the revenue basis. mix total and of of only other revenue versus represented decline second Mike QX X% and and in revenue represented of and We revenue in declined revenue.

roughly XX%. other services decline rate you healthy accelerate During we the of last runs. still XX% the declined half remind the the that which and and declined year-over-year anticipate one-time XX% to first is year, full-year for half, to first of other to services long one-time And compared for XXXX, I'll XXXX.

Turning to profitability.

of operating operating within income performance XX.X% of to diluted XX.X%. million, land Our half earnings that share an operating and guidance second quarter investments margin positions heightened to point margin of in XX.X%. first $X.XX. and of was gross for XX.X% the I'll generated $XX strong the margin operating includes full-year out We our us representing per

our headcount accelerated pleased as Mike continuing hires to calls the ramp And our As to the new sales the average. at of for progress targeted look we're productivity. historical as to added date grow relative mentioned, rate an they plan with we hiring our full-year

further continue market third-party expect the and behind bring investment the of we investments, half of expand exceed first our level to With to our shift two in we to hosting. second selling footprint, quarters hiring us, new as half and sales solutions our pace

and cash Moving flow to the statement sheet. balance

to flow which $XXX Our on QX free guidance to million million, us track million. was full-year cash $XXX our of $XX deliver puts

We for development. amounting infrastructure strategy associated in move CapEx, and and to investment workplace million with support global in infrastructure to continued making necessary our our primarily $XX cloud, investments $X software capitalized and to innovation the million

million $X shareholders out we During with cash paid in ended in debt. the net dividends million and $XXX quarter, to

X.X the strategy end ratio at stood for of at Our capital times. X.X under And we a just QX, less debt-to-EBITDA calls than of times.

to capital drive our execute summary, will on In against guidance. plan reiterate to growth sheet, a improved our to us scalability. the We're strengthen our and and we balanced with to financial maintain disciplined to investments continue business full-year strong strategy to maintaining balance capital approach shareholders create return our profitability strategic and growth execution continued allowing is and deployment

like that, the open for With up questions. lines your I'd to

Thank question. We you. [Operator Instructions] first will Please go move our to caller. now ahead,

is line Your open.

guys. morning, my Good Thanks questions. Hi. for taking

wanted I upside and loud to this clear, job kind when of the that. continue in earnings with big investments quarter. need hearing great But in to and margins. the I'm That's here start say you Congratulations of profitability heightened Mike, you So, terms here. on

So, I back I we in year, last half guys more that could little the in the And just somewhere about was bit. reps talk year. bit a ballpark XX or a hired of think of hoping little XX you the of terms than in

faith-based. jump-started You

be businesses we reps scaled ed. high-XXs obviously, you for want to you mid-term us as rest need kind guidance, pulls higher need the that a the implied to thinking these and It to start Thanks. jump-started investments that more the of XXXX to guidance. hit like we leverage? You keep year while. bit that to sounds want XX, you Or many that margins longer-term faith-based Just up the you need? and see sort of be to hires a ed those range through the think you little for the a what's sort think scale of the more year of back How the scale heightened into at the of where kind kind out? the sales on it do scale take could about look us what approach? higher And to to or get get of How

Sure, Couple things. Tom. here. start of I'll

both acceptance of in First the couple general faith-based and higher well and the really in on market of in months. the to the of great themselves all, we expect really be and investments and ed, platforms going are both those R&D announcing availability is the next

So, they're well, Adopter Customers really both. going Early on

moving So, those investments are well.

last think as XX, also people year. in I half We increased last XX or mentioned the have back the months of so, sales over headcount, you

those up And more increases on plan in in sales where then this will QX It bit continue as like higher on years of folks to and shifted We've we lumpy. of sales. well. headcount, headcount increasing headcount smoothing ramp a The ramps year be folks Some little some year. were next markets we won't in in last QX those some bunch that hired around and ed and in plan faith-based other in loaded year markets, two year. back-end out be as future this a

YourCause and sales but already it closed the you doubled the now Yeah, January And the starting so and of plan on to future YourCause like I'll in the just QX change, headcount of that board. that year. -- plan that We numbers about that in on be on out will to investing we're triple example. micro we at more years, new because business. all January I out we and in net hires in sales said, across be the level, break year QX the continue close And having space end and this one it But smoothed the give from of not year. little next ramp between hires we've

on So, business. that opportunities in we're sales we that the cities, one hiring that's in We're major kind growth opportunity people have. of down because example just where doubling of the given were headcount

Outstanding.

costs, sales, the innovation also loaded the will but quick not to, think, I on have It type guide. the only margin spoke we on Tom, real some back-end side, continued on investment those of hiring and one-time the some the that in Mike be of with that cetera. the still got IT We've costs, because lumpy hiring. recruiting projects, major more integration ongoing in are on, consulting expenses bit ramp expenses projects et are some associated type

as margin heightened some is are drive full-year second we well nature hit that of those of in versus in one-time kind there a down what the first half. bit. EBIT in saw helps the So, costs more which There half, guide

Okay. quick for Good. you. follow-up Tony,

those K-XX Just business, we it in of and had challenges arena, QX, the you've mix stem some UK as challenges had kind some last lap around JustGiving. humming been the QX, then headwinds, sort some think of with, some was some in along payments you the of we which shift year issues, and from I

rate and business rest Is at growing right should Is As details we think we around still it the little lap as Is headwinds, payments payments of it a the play a about business? of quarter? Thanks. bit a those stabilized? how role kind now? it in payments in headwind? the the how some general same of Maybe just this

giving had Sure, payments continues. which year. on of on the kind and which just of more the was in there, soft half kind market of so us, the front, market overall has that was that because still we year, than of historical UK softness the the saw big acquisition. That back UK impacted there JustGiving been three Last the us that that time hit similar unusual, Yeah. front We areas Tom. frame really

a parents. that big recall much better there. well of in of in this was job, we so We we're no doing to think shift plan, one mix actually had Tuition, and forecasting mix Smart did just affluency a where year, real issues you if so another parents I

We year. haven't that seen this repeat

one-time major we we events what had a previously. really we of seen just those less than stability year-over-year not issue. then had that's And So, where had

hard So, and of natural say a lumpy. disasters still things. what to those little kind hurricanes that are going hit can one be It's to or

to the we far, see are on about that good payments feel thus how business. plays So, have we we'll where But out. really

we've is et the do because rest growth job it good back rate -- going the the enabling positive a NXT we're with them done looks penetrating base came side products the the think I the think to cetera. of a sell when since solutions, the payments Mike like on more I lot business like base now of selling, and the we on And ed So, board.

continue think on products. each much assuming to of job do So, typical future payments the turning those with kind and I more a growth, we in being see you'll correlated the to solutions our with of subscription that tightly selling good of

to next Baird. go ahead. Please We will from Oliver our on of Mr. move question now Rob

is open. line Your

Thanks, Rob a on had a guys. just we this I It's me. are acquisition. quick Excuse for on into Matt Oliver Lemenager now the few Salesforce.org -- months a ago, morning. one the months few

Salesforce.org there? changes seen out competitive new structure the but you've So, that ownership any early of any I the front, within it's I coming guess on Salesforce.com? realize given early, changes

No, haven't any. seen

competitors. we Just in markets, have different of remind our very you that, many

Jenzabar, higher-end don't markets that We We there ACS Salesforce our we're performing all. Management, in and solution, the see it's don't And brands. competitors So, out Ministry faith-based, markets... Campus in the replacing. and are competitors those at them are UnitX our Tarasoff see arts

K-XX.

market, we them no would K-XX market. comes see seen don't charities and should. But what And them I lot market, change. a don't call there YourCause see and predominantly So, them, see topic we it up we've

quarters going recurring or think, Okay. in Got into margin, It's trend been trend the I Tony, to what's -- Is recurring year-over-year it. on in ask Thanks. down or the gross the year-over-year on again. And more for, payments there been I a row the quarters ticked down just there? four kind then what's that of gross five now. margin line? the wanted

things. Two

QX, some because if some versus which you're half, that and that bit, talked, the in rate, then last in slowed payments and said up rebates have first recall the that it line not one-time the our a bigger bigger 'XX actually incremental selling benefits looking of to products with year. rest And all we little half had we a you're growth the really will move And and expect efficiencies And of out business, stuff new we more trend third-party you in our bumped more and of go to time, more COLO plus cloud. as of we that hit it's and once legacy to getting of become cloud. If from, would we're it's cost with data the we're products we going that get actually continual the of first has the is to COLO margins the cloud today NXT and at margin And would still centers. the because payments QX move on kind all impact we're cloud. seeing base cost then migrate to is of -- to migrate the to gross that over that cost more of third-party costs,

the go then so Citrix in have we migrating as sunsetting costs of shut that completely, see some legacy drive cloud, time. we won't other finish NXT finish the will finish cost incremental have migrations, those COLOs, we'll we're cloud, to never We drop costs away. those of or our when And out the per the we'll that we'll actually so goes go to average the down products able those and of unit products over and third-party cost things the will products

fully for some I cloud. a long increase positive the expect to in see we to the in margin get So, gross see COGS continued near shifted bit and term term, going the then I'd should we as into more line we're benefits think a of the

Mr. to James. our from on move of now question ahead. Peterson Please will go next Brian We Raymond

open. is line Your

the questions. for Thanks gentlemen. Hi, taking

start to productivity. some early on of the wanted sales hires in So, the

for the that curious You you the with process results. the expand mentioned new of in these on Maybe people you're looking when there's brought early anything board. we're early what at evaluating that can hires? I'm on you're if sales But I metrics that. realized new you some pleased

Sure. Yeah.

and territories. ramp-up to again, in So, QX reassignments in again. did nine We the half folks direct QX in going last and then is deploying things the really two year we're ramp-up the back first One some in last and quarter have months. of

been of key before. XX-XX about base. key we've -- XX% on back not the roughly headcount the we're thing And on XX% and us And for is, prospects now to

that's a been shift building as So, well.

on, a different from we talent, of coming get folks not applicants places. an having far As as issue in bringing finding lot lots of in

Depending faster if kind more on focused mid-level, you the deals just size if on. it's they're enterprise level than you're are of given and of that complexity ramp time,

nine well, think I So, you gone if so. just back or months ramp the has last look the

on we the folks I in lot and in plan on next doing we've can bring a short the we months, five think demonstrated, that months. of period six

Tony. is this Brian, And

with at news. are of we've a to look initially all metrics, adds all of what are nice really metrics the full and there. kind and ramp and resources ramp the which key On creation of that these those farmers, seen hunter, expectations all we And net things, these quota and is our moves, good reallocation on

our of bookings why toward changed obviously, recurring track kind track of of for bookings, have that's look we for And continue two couple in versus certain at ahead ARR, approach. got So, not where -- We want new we're others more our the We've part. we mix. isolated of quota bucket logos. had we're verticals as plans plan. comp the and pockets to and one-time we we're then mix And the sell on to want a for to on and we most shift where

to the look that level, pack to looking ARR at higher little and OTE. as peers. selling logos improve compared at middle there. our we today of we're a to of LTV of We're spoke With before the we kind So, then about ratio. mix to CAC really we the level, long-range number want a goals at you're company And at

good in in We'll comes more getting ARR OTE top to down and gains few productivity into on over get those it which them, improve to but that shift to retention shape. next rates the try to with through work years, I think and that means mix. quartile they like our ARR where are, to in continue We'd we're really

on out those the day the of of But we kind day level And here sales look so in, at highest that's team. metrics.

call for for the There the you. Tony, We've at I follow-up subscription. we Thanks, the would what look the guys. curious, recurring that item, I would guys. you seasonality I'm payments quarter Thanks versus there like core any know normal is quarter? third color, used to is there, there just got the revenue if is maybe, way -- line recurring line in what is frame And there a second for it. revenue maintenance. Got look

Yeah. are we're shift with not consistent shift lumpiness. to visibility things typically drives right. The Smart usage thing those Tuition and -- less recognition. variability that ratable should payments is the you that With related in and related and problem, recurring, are our school And getting and then continued have really there the comes there. the maintenance in The years some can driving variability within have and more seasonality that obviously very are are and seasonality. a true Those payments, subs,

at a looking QX. QX, we've that deferreds into some obviously, we run is on renewals what cash where we of our well have the is because collections heightened lot seen, and up because you QX, has then more have So a also typically QX renewals, in QX lowest. free typically QX. start typically renewals because big in when variability impact come QX a flow were on jumping which in as you early what bit we from

we're talked keep kind expect eye in what and as faith we an because quarter to potential shift. products, out to typically to those decelerate these is of as thing a like that higher historically. on have historically. then I It's another that seeing Mike is to seen giving. volatility have The less about seasonality what some And in than that YourCause, would then we to acquisitions had normal roll our is new we think that now seasonal And we And bit higher to than and we've ed continue continue seasonality. I of continues seasonality QX

Yeah.

So, major won't for live platforms back holidays. on changes religious don't seasonality the by around September, in vertical go make faith-based institutions and given different students new are is example, coming markets. Schools

so And when market cadence live. when a but of has around sometimes, each they the go different buy they definitely

to We Rishi our next will now on Jaluria. Please ahead. from go question move

is line Your open.

taking guys. questions. Hey, for my Thanks

rates want I the the think, a I I first making the growth in QX sorry if organic below recurring I'm where little recurring first, are bit from But look definitely organic of want a like believe to, year. to growth it to on just just and side. last ticked mean, was half you back I'm point. go it down

facing the I decel. And compare into QX. just help the of metric we maybe in looks little in if understand back why should bit of you expect versus takes I could and know we're maybe to guidance, in a tougher that faced up and QX puts the But the year. what a you us back your if half it like kick

bit? what's So, us a maybe help I've little accelerating a also and understand giving follow-up. got you And confidence then that number kind of

Tony. It's Yeah, Rishi.

really organic kind new with you comes are we a to of down tough QX the is spoke growth, to in compare we that because what it folks on right hired line the is ramping think as I it expectations. in all

XX% of then rec. of the are recurring so have, business So, much some the historically. like built That's there. And the new only those that more much good about of thing And kind moving the there bookings related. than year, usage had a payments we that's last we've and for tools that XX% to talked about as accurate really we forecasting again Not is we now we in lot of volatility range, visibility in good feel side really because rev equation. have

good we have really So, there. visibility

So, We're track. plans. it's right we're kind that compare, XX internal the all of really said, the on seeing of ramp by change expectation basis things that to points is driven really our

the So, seeing. are the there's compares guide. think I we last anything The that Mike, I on feel of. full-year real of only know QX driver good really? else about I our year anything reiterate that on years can don't

Great. Okay.

add. I'd Yeah, just

We and are sales ARR. it year-to-date I be driving we in with are to where ramp things expect think going well

investments it's said, seeing we spoke the and revenue expect didn't Rishi, forth these impact late or Mike lead to this on sales year start real as early remember, we so next. and heads until And in earlier, days to that a all reallocation early

They're ramping ramping. but to going full versus turning they're until so bookings actually revenue. and have wait into We're a them quota quota And out start that of that's getting that to to point. bookings. to start materialize And getting then we in

And since this revenue early more QX so and and next the year impact positive we've these investments year you'll I so think of of QX making year more last of the been in in part of see QX, side.

APIs. I believe of to chose mentioned your it. customers of to Got one remarks, one Thanks. you your turn because That's wanted the And in helpful. prepared I the APIs. you just of then --

So an customers maybe change are can more could you example that APIs efficient transformation whatever? how Thanks. digital of using maybe kind or Blackbaud through from trend then or or the And here? the become if you go maybe business API to give of think how story

case, really functions In the function Sure. which all. business cloud with the it is that not school that school, just for most of school, platform a talked of And a I our covers has believe. I about a going but

data of with. our there need always pocket that share and platforms solutions be to will are So, ancillary sort

and also is be in them integrate fact of solution. have replace that it they in integrate need And allows that an to maybe which last niche we Basically to with just and and then have of to a gone ahead eliminate run lot industry usually the things cloud, ancillary helps the department. the legacy platforms years legacy that but it APIs, are we solution, some going departmental which we the open the with case, APIs, And provide, a to our don't able that's systems with school. solutions of standard go down several the by open path restful that a

question move to of go now will James Please Rutherford on Stephens, We our next Mr. Inc. from ahead.

Your is line open.

months get to ready Management you're Church Hey. for and XX you. coming taking particular your this of help comment to Good to for bigger just morning, interest the months as might important new the one into you to frame business over Can for your product questions. the how application just first take months? XX And starting thanks general six Mike, product availability? you for see total up be level on that

Couple things. Sure. of

of all, of interest First is significant. level the

we market think, at an We that as really drive this conference, We now. like the shown back conferences up and in the direct fall in industry last launched in haven't marketing I far have product as year.

and in So has significant. sales had lots up the been We've XX the months ramped to talk We've here that the last team. coming interest headcount us. prospects lots in really of to

in a not has legacy that lot for really lot long systems. There time, innovation space a a been of of

now. adopters. system then market. interesting that $XXX Church new And who for in is third really billion Church that. churches just course of So, We've giving, signed there on general and decent over for market fundraising, of using available which are of up cloud, XXX,XXX is which States. selling we're live look is of if fundraising, the too, thing, over in United It's a an it's is financials, financials customers also total is whole The is thing few you today early because cases many for interest. quite faith-based there huge going signing is But Management, integrated waiting a annually, as a a the backlog at which the the And over Management ton customers the a up customers availability. got are pretty who or

reoccurring I huge availability be announced new a it's underserved. been it's to next has that believe market building right, That in will So, general of And because very couple a while, in revenue a to get the take we're going platform. months. realized

and Church growth. really And doing a because we're of in to for done been world. product a is this it doing term, the and portfolio And long This no one can a I be that factor really while it's and doing. our hasn't significant up very what difficult is way. for growth we're this significant reoccurring a Takes So, revenue quota whole new investment revenue an what bringing to building ramp to do platform think our ramping we're Management market market for attainments part the up. future

I'm But or us can And you for progress applications? products legacy helpful. your your sure can follow-ups on better not modern Mike us these more conversions of That's you perhaps NXT to Great. if from through, want update until the do stand, where you Tony. there. a we're Thanks. how you spur is to and progress you're on what switch There that conversion? questions But to that long comment how the in that of doing conversion? around number update

product a NXT, every closed to on we going move. to is, example, do Sure. to to have fully Edge mean, We're lot was not customer I Part years over well. take those Yeah, it's capabilities closing be of was gaps in around things now. type that. nichey that done keep are it of a build We we forcing to not and on There the the are quarter. Raiser's a move. everybody to for years able done couple folks based knew going of things those to while that need customers be for it

been with lot to gone and Financial there means modern the Tons stories, our it's cloud have every intuitive month. mobile-first had are with which well up released have on the of it's over Edge products customer impact NXT. So, white Edge SKY customers built our features and Raiser's of has a and moved platform, these base. success It's papers written

pretty a it's platform. So, velocity high

for sort and a of launched years Microsoft that in Edge there Azure, to going And got it's Azure and those we've more we still we that our time with Still two are partnership. get some those side. where more couple of COLOs the there we're the products yeah, example, fully are earlier, big expected left the And infrastructure to been has -- on well. shift for that about deploying NXT, some the of in and years in Raiser's going few be where But products take from we done talked a is COLO So, products when more Tony also mix. products. ago. NXT to pretty to a legacy

going that's all So, well.

James, this is Tony. And

tougher spoke kind year, we the is of, the that far about the that as we think those of it's other of of thing number because a last bell as I migrated. we kind curve note compare have now as to customers crossed over the top

perspective. of And that. a over getting the we're so a more getting uplift front compare harder is we Those are and moving revenue the of on years number from that past pickup that the now. was first We're because financial

stomach So, it's the compare. but to on revenue now. little been the half in a handle able tougher we've front, We're that well pretty

ISI. We to question Evercore will now next our Materne from on Please ahead. Kirk go move of

line Your is open.

just wide much. you're of you given on have of point time? very a all like right it at sort time. this product your broad Thanks you the pretty portfolio on sales and Mike, on the you Is could can do M&A, at of bringing headcount wondering Okay. now. if thoughts kind same was seems I comment -- both It in

trying on think a get about just sense I'm that. So, you to how

first. I always done, sort investment added inorganically. get you've that in some amount think as trying little and gone -- Thanks. away thought shift But that of along have might the process guys the you to if days might these just wondering given a squared in sales products bit, of if

both last been actually several years. doing We've sure. Yeah,

really TAM pretty broad years really the And in ramped the high having and double rates, the broadening but the ramp It's up really last isn't our pretty portfolio. aren't a made Last about we've last acquisitions acquisitions. That about the new years gone fundraising growth. some the providing about to been was from headcount a XX Our in rates year, sales We've have just five verticals. in several and financials the story. we heads.

platform. fundraising thing look run a faith-based. platform, and the at with happening and Same those relevant higher education, make eds, those platforms whole in K-XX more now traditional they school. expansions If is came platforms also in financial because And expansions our are just from M&A. stickier the and our you But integrated full school

we're going wouldn't acquisitions. So, say to that I do not

just impactful going their if and we departmental relevant to more now their to spend. think for or particular vertical the in XX schools to entire vertical or in are beyond opportunistic really in player can able and stronger And XX of a K-XX cloud universities that be IT and small become vectors covers be with move churches we most or operation one it's replace be We just a being fundraising.

We ASPs cross-sell. our sell lot The are So, higher. bigger footprint creates opportunity modules. to a more a

the it say answer I'd is, So, depends.

demonstrated we and think don't can in parallel. things they can to some are all work serial. have also we I we've in We these And of different. necessarily do do that so both quite

with per any yet a replacing we're se -- the YourCause look it's of product the players at on really the top didn't that largest on doing one If YourCause, platform we're YourCause. that And category. you had step a of we engineering because efforts other space space, legacy in different

to continue look. we So,

sheet and debt. well, us. transparent has straightforward and balance We the quite for bank pay that Our model We do allows much. extend it us We and pretty to do been don't delever use down.

X.X I come now times think at we ended the continue quarter down. to it'll and

really provide solutions being customers. it strategy So, organic growth able is about for and better and our to fulfilling the drive

of -- you get then sort And maybe software to market, maybe this sense replacement. excel versus, upon not sort greenfield? how of Management Thanks. enterprise product versus little wide-open even traditional the at Church there dependent technology any or helpful. look a cycles much follow-up at the people not replacement might on a are of Meaning guys on of I'm that one how either just you sort just of using just point product. a That's market the market just When of is this are spreadsheets of folks sort in is trying be sort much using sort time?

It's Sure. a mix.

signed have XX stand-alone the replace up, many something solutions. software out there custom stand-alone that then single a market. vendors we commercial have doing of solution. to in unique are We out We've with is there have seen of able have vertical together handful churches and companies Again, XX predominantly there. seen cobbled that builds We're cloud sort vendors, point that systems a

interesting of have lot that's well. schools these hundreds thing other as is, institutions a The K-XX of

addition It's to, opportunity for market. there so I also big, our huge church to what is them opportunity lastly, K-XX big market, a consolidation with addition an in platform I'll which a our And just And in management reiterate platform. said is earlier.

all churches sizes. several north XXX,XXX it's billion and $XXX of side, roughly donation the On

fast. So, Church has Early run. we're well. it's platform have The got to going start the really next do months. We a I in don't up yeah, general interesting in think in build will And, we year. And think Adopter gone availability including long this really the opportunity right. go We've of to Management long materialize Customers on next announced, couple investment years, It there. coming a will run and to is the be this really

question Mr. Ryan next Needham. now ahead. from on We'll to MacDonald Please move our go of

is line open. Your

guess market. questions. headcount cloud wanted with Obviously my sort seeing Hi, through Thanks I like investments. Salesforce.org I for taking the also agreement their we're getting enter the With with Mike you're aggressive sounds of with philanthropy sales it more Way. and aggressively Corporate YourCause, Tony. on reseller Responsibility to United Social start a

So, it that a seems like of in space. there demand lot is

the for guess, I'd sort terms you versus, I potential are you Church initiatives velocity sort YourCause seeing in management of opportunity know say, of in then just in some do from that size So, customers. of the of to like area and how education what Management? pipeline And other

all of This all going focused really be of and there Sure. time for types on but for matching around these more tying volunteer working It's is which a a companies And while, on types. their is employees that gifts different to is happening. been and trend with a their to market, companies are brands.

I the think DuPont. earnings closed we I call, mentioned in last

morning provide mentioned of Philadelphia is really also to any size I company any volunteer NHL to market gifts, And wants applies just this size, in customers. that to And it many most with is and their really demonstrate that existing prepared If my XXers. working to on and the our employees remarks of that matching Foundation focus wide.

healthcare employees. about of have that institutions think universities and thousands You

base a as our back well. is into this cross-sell opportunity So,

side United think I Way different bit thing. is little a a big. So, opportunity The of the is

where decisions want to employees on are opting where companies platforms like Most personal and they YourCause to volunteer gift. to have they because make want

Way's also customers. We have United

In deal Way. fact, we United recently the at closed

that mentioned a big is the thing. YourCause It's I last a But different platform. well. think I on quarter as

really it's a I think marketplace. big

market that are headcount adding I to, really functions interesting engineering on. focused significantly engineers. a We there and and sales sales think companies more And supporting that, are that's the more and

a good They reach. platform have a with today big

platform they through X calls, YourCause on think over nonprofits mentioned I XXX,XXX previous employees several platform over the have a last years. and the donations received I over million have in

of with there those us given institutions opportunity product So, for rest portfolio. an interesting the our also is

So, growing I market. space. market this in interesting think is and only a a couple There's and big players the a of

thanks. you expectations I a year And sort entity, for quick some toward then here for of with a move Tony. of And that we're Got increased exposure there just of follow-up back the we end a that UK-based it. and JustGiving decision guess the sort half the into as October. at gives business. looking being Brexit of the Obviously, as

what -- on sort that market of of that guess, of impact Does expectations, building sort there? overall FX I are you or in terms

from could We half some largely currency first a is impact wish driven I had wildcard, by fluctuations, the UK in market. FX it. right? the I Yeah. predict

by growth negative. the revenue I about impacted it a to of on point us think

So, we'll and happen eye keep there what's to knows to changes Brexit. one. with just on with recently Who an that all have going the

there. off been has Market

factors. been lot major of Brexit a same I things, concerns, think one-time -- in a events years. different environment pushed think And has because overall, has there down been just in prior versus I giving the has concerns. economic been the UK market of often reason is the UK the part related of been, has the There on some of is decline that

So, be. no what will eye can There we predict that keep way just is have I on it. to an

business, of Our that that just our business piece JustGiving selling. core UK a business, of is means core our

is well. actually portfolio doing product Our really

we're been feet a underneath job. well great and got And board his now Benjamin has really on David doing it.

there he the have which about the is with what excited currency well and with Canada. We're that with. we're I'm work in Canada, think another I we to are and ramping team team. doing really doing deal David

the of market us. is just have something good an we'll keep international eye I see affects about feel that overall. The on and to side So, the how giving UK

has leadership up recruiting Yeah. there international as job international there We've headcount has way, and execution opportunity business. there. been is we gone our sales a with big is done Sales our under ramp in think great business a well. well And

question our to on Please Mr. move of Mark go Schappel from will ahead. We next Benchmark.

is open. Your line

to has give of question. some you the solution, new little been? respect currently for of are with you're a the the what maybe with your and taking Thank detail differentiators seeing a some solution, also early you're Mike, of pilots the few you Hi. what details just And with respect my more solution? of to go us that faith-based that bit on some feedback conducting you could believe into

Sure.

differentiator platform single the cloud a for these is institutions. So

to in software earlier, XX,XX an XX from have As to they vendors products I vendors. most mentioned cases, replace XX opportunity

integration. in of about platforms, So, have light operating institution, to user those log think of you any experiences. XX different XX very All have weight Each you an those or where to shop have IT And aggregates do you different unless build engines. that data don't probably an can't aggregate engine that data. reporting a reporting platforms separate can These you institutions have that.

it's on you one log business, to whole will, So with if the us, all integrated. run

have includes can and to across And you dashboard or XX it's points roadmap and completely Also it's one significant running signing vendors. as platform. different a the the a an XX scalable. and it of day data facilities a fundraising in platform in that components it's a and intuitive is like report stable investment a platform different So, the platform you platform connect modern create has mean to opposed the do pretty all up modern, church, care, a vendor mobile financials, unique. a I integrated the and with with things institution,

of And handful smaller a vendors of are these employees. some

is been signed we've the contracts has have here And experience a clients go we'll been and platform, engineering in and They in there many of have we've got a done So, kind said, adopters. providing what live early we And what just I live. the backlog. system massive difference And a we who our like in the of in the are announce many, and early quite team months. feedback. couple availability with using day, few adopter every general with

back conference for to further no Mike any I'd It time. appears at to additional Gianoni like the closing are or there Mr. turn remarks. this questions

execution pleased close by quarter operator. our saying, and the just the Thanks, with year-to-date 'XX. call I'm second I'll through

with Our platform, still Church serve. markets aim the transformation advancement all I'm board our progress of the good digital social in is community really to the deliver we the platform All excited ultimately these us about our across employees Management create value shareholders. for These ed and time. higher for growth YourCause. our will represent opportunities customers, long and investments for across addition the lasting significant a of

you forward Have look the guys I our next and Thanks to updating Tony on good progress on call. a day. everyone.

Ladies and Thank participation. gentlemen, this call. you your today's concludes for conference

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