THRY - Earnings call transcript Q3 2021

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Operator

Good morning. My name is Rob and I will be your conference operator today. At this time I’d like to welcome everyone to the Thryv Third Quarter 2021 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers remarks, there will be a question and answer session. Cameron may of begin you, Capital Relations Thank you Markets, your Instructions] Lazard Investor director and [Operator conference.

Cameron Lazard

a issued Thank Holdings you, X-K be press to We release The related found third Thryv ago release our can quarter XXXX the furnished operator. earnings conference form Welcome the short time to on press and SEC. call. President Chief the and Officer. Rouse, call today the With me investor on Paul and Officer; relations section Financial President; Joe Chief of Executive Walsh, Grant our Executive Customer and website Vice at investor.thryv.com. Chief Officer are Freeman,

and the the would I useful in to questions GAAP the information results comments like Thryv non-GAAP posted Reconciliation information your we investor to be provide financial to other will no certain at some the obligation the these call statements With website These measures I described begin, we to of believe of investor.thryv.com. of call filings and the presented with the some of relations measures you reference on on to call. today’s for may the introduction, our will over contain on will update which speakers Before risks Thryv. on call, and that future today’s and subject to Also like uncertainties operations are turn company’s investors. remind forward-looking to that the would Joe SEC, release statements responses earnings made the about has Walsh.

Joe Walsh

for us. good Cameron and you you, morning, joining everyone thank and Thank

in best company our release, already continues read we momentum with our quarter deliver business. a you’ve our being earnings public SaaS our As in accelerating growth as

our again we guidance. so will once raise And

were that investment us we guidance here. few you shortly we scale business our just of and played our cloud Our began a really And with the through in It call. this take how we were that in journey earnings bought first last some I boarding year really ago introduced announced we sitting harness year our exciting that will to was here we growth. felt new and and the areas CFO, and to this our think thought like a as after borne additional company in out week which Paul public We a SaaS for we very have to category raised be and over helping the for say out massive promising SMBs out we leader organization a minutes. Rouse company pole I’m laid position poised those we our for today decisions results. And that pleased strategy

public, came EBITDA were more distressed going weren’t to a of third So bit the report SaaS let harvest context for little digit a out of the over business. put and me XX% double last we really out that several to you of into in We through building were Prior delivering a quarters. crossed And debt quarter. setting card momentum want I we walk our you. so of revenue for margins we footing. the a

to make was it make charge Our money.

QX over growth. the quarter weren’t XX% year QX to from growth, turn had But we year XX% and so now growth, new X% we’ve investing toward last then growth we quickly. last X% growth And and where in the XX% we in really fourth more in gone we in it growing emphasis as quarter and our as over shifted investing and growth year, then

in is stance there investments really So we’re you in advantage the can new and the that kicking of that taking out see rapid adoption and those happening marketplace.

up to is XX% year-over-year. rise ARPU $XXX our We’re it’s seeing what

the thirds clients are of they When were of and company, everything think really retention significantly. I all measure our where up a levels of And like year about sales, we growing, platform, channels new think two representing within an overall you Our a ago. it Grant? by that into would minutes double engagement XX% new the acquisition is now be but the things coming services so the we’re are new-new coming base at seen one speak is have time time we Chief app, the SaaS of mine all third marketing And some about measured fitting Customer to in the Officer, We’ve Freeman clients of seeing Grant continue of to about in here progress our to for are the area. as few business. company. them record the new high

Grant Freeman

progress engagement to within the important engaged client being be earnings to made QX platform. our here our Grant. our during increase success today clients excited that for and repeating Thank what to our call to with It North was software an start Joe. Star client. as share continue shared you, I’m their deepen is is

trends looking from angle. some We as underlying it to are all every data continue at improve. today, to engagement over our I with you want share

is September year-over-year XX%. our for over that, continued see upward can look we using XX%. we of feature the we features users usage, more For our specific example, up active When of is daily platform up or see over trends. clients percent Beneath three at

For functionality with XX% is XX%. XX% estimates up number using clients each and the example, invoices with are the and over clients over of over sharing clients and campaigns documents payments sent up number of up

great have several these in measuring been results always internally of part churn As ways. different we

We quarter which churn we past to and have have that proud reporting our share the for year, we X.X% are metric, standard was three. churn for been

we lots measurement. of metric dissecting Now reported reviewing very current conservative time while a spend it, churn our is

business additional look to our to now go this strategy. add We We providing sized present have stability also and market context and than value adoption. Small and behavior to it’s different medium since churn enterprise for feel is at behavior. real is there measured messier

churn engaging the As in the of they stages newer excludes as clients software. measure such, of this early with are

engagement, for engagement over end is [Indiscernible] Thryv initial our on-boarding during our but see following month client of when we aggressively our months users quickly have we up look integrating the the month For we software, we it when start to deepened to and software. at blueprint a journey clients,

of been their payment not for have reasons, or also a simply like variety those who them going engaged issues may We business. being declined, including of out see

allows day The into the first integrate the day time software business. be to their fully to learn, to and coached, to them engage year

a As year-over-year result, churn been of those we also measure XXX us have least year. over engagement who a so clients at just and with days,

using of. clients X.X% This Our them the to compete means metric how those over is their intended effectively churn only with engage features a and more we allow the modernizing success, into the use integrated run we in is as they business. extremely to as with fabric time, of software marketplace huge are these more proud through They who it today’s business. are a product their

We we also begin engagement monetize. to deepens, that as can know

plus year, example, the consider year our dollar has XX%. from just when their the that For net is spoke retention one past and XX% retention net about to you we moved over clients XX% dollar

for We of also measured have number years. NPS a

it’s measure Among have seen of truly are our headed. again. ultimate year-over-year the For where a Thryv improvement we us, significant users, we

time. much or will that enterprise critical relationship is software have engagement is a this It’s buying we Now over much Engagement all than that organizations. a businesses with membership small as like gym early be we renewing do deepening all coming know different January.

to weeks. be and have may all how and But go the unless equipment, you long of few healthier, the will You first you go health. around may there discipline learn to true the for use be no exercise desire the outcome for term, create better

salesperson the are which that it, small that things partner business. a have engagement giving low results us, higher for seek a the software few practice Small the team we’ve engaged the here to will of to of with with completed software, engage model, clients similar. a them buy the businesses It our the need learn fit is almost with to engage our We’ve is motion. the happen. this In Software and software adopt with all help Thryv and sales, needs who then ensures and platform selling To truly just software specialist for done. yields time becoming they a churn. sales evolution we local

focused best also We’re value. to first time delivering a in on class

client understand small on-boarding business. then work the problem over and ensure we we time that for solve, the to trying on-boarding solve XX at the first Post engagement within deepen During days. consumable we it to is we is the a main that pace

the to Our client to clients higher platform deeper we how net strategizes the XX higher the promoter coaches of of to our usage we higher solve score. more of course and lower see result, also spend clients expanding business. and critical a software more Catered team managers the along the use engagement, months we dollar retention use success to aimed with with As and enticing to have at and our regardless for tech touch of is churn over measure net problems continue first

turn back Joe, it to that, So with you. I’ll

Joe Walsh

Grant. Customer Thank we you, is customer Officer. Grant our our worked really have in reduce to drive Under and churn engagement. methodically his base Chief up leadership,

already. the to tremendous marketplace, So of now and delivered in on I’d his area. software we’ve We’ve the the the product customers beginning for the got progress and excellent teams thanks March localized turn Sensis made since. team We gotten it victory training they’ve and to made Australia. we’ve Grant like that many using to the software, the acquisition into

our in a We’re profile client say great experiencing in. Australia’s ideal organization of really strong engagement must and job bringing usage. I the done

We’re people even beginning to referrals for that are it. using some get already

off it’s terrific start. to So but days, early a we’re

that Thryv it’s have expressing to as lot received, in demos we announcing We’ve Australia been a software Australia. also getting really website. There of which campaign of a speak lot people it. media rebranded a it, out in been of has Sensis traffic underway well interest We our driven to is

of are of ability we’re have we’ve base a lot businesses software opportunity but marketing has to to I customers I pieces services high the to terrific prefer. with SMBs in And innovation expectations customer the with to got recent way, do XX product and happy it’s whichever SaaS a about a format like penetrate momentum, beginning and our this think over allows really it to be a of a in just corner and course that So really centralized that organized, inbox. position steady they like to very I couple communicate going think ideally to going the get with has continue that. they prospects, for years kind the of always just wherever in are predictable and their really performing, Australia turned turn nothing and us first now I’d to

messages, for consumed it virtually centralized message lot a inbox, couple because Thryv that is email, of which a it any check. Messenger Instagram, way it a times contact having this Google maybe check all one business small small It chat, could in saves multiple inboxes, that text really to come you apps, the all Facebook, the brings business, web CRM at My right up So Business, forgot of shows stores to it into card. And days, having they into place. our

a there breakthrough for marketing, do all can can they those small most begins and businesses. record database, lookalike it’s all email, marketing, marketing, So to to actionable lead which do nurture is base, they that build CRM things, up begins a a and build follow like

to conversation they together when can contact And apps continue don’t is a this, between seem centralized They’ve expectation I’ll say rise. pulled got They business, just really place. So juggle one in real in back threads. to to they and or have respond time. forth dashboard. consumers a multiple Everything

deploying are companies employees. few more businesses of rise, of more gratification, kind small people’s employees they a or and lot only a and more instant and a of pop couple mom expectations more want technology, As have

their own has recently big really think see powerful really attachment big about. pocket that been I payments So volume grow existing to like of to our really convert to I’d use say more driver going want to a to third the a have target that just them that to clients that higher all allows to make them. year talk over passed having which a two. of started always to payments, next the Thryv. payments over to makes million like more to than our or half which About like our to the teams and is the difference much more clients a back rates we’re Since launch clients the them activate more them in we clients a us think ThryvPay, helps of who engagement or see ThryvPay really mark, big connect competitive their of we initially convinced now this ThryvPay and on But $XX for a way kind in pretty this or tool I number. a pleased it’s about PayPal. is bring time it Stripe We’ll will will which continue And to software, Square over-time. is SMB big accounts total businesses to that over over bring and newer ThryvPay as us. pleased we’re in deal small chose with half loyal them whether lot efficient our our we’re which payment offering may get is that paid grow

steady a to switching seeing primary where ThryvPay We’re migration and more more their tool. make

So ThryvPay lot. really done primarily big has helpful really a It’s a deal. us

I the presentation results. talk part and Rouse financial So about a the our would bring third and quarter to let of like now turn Paul? Paul him

Paul Rouse

business SaaS. you, segments starting our with Thank Joe. cover will I U.S. now

install prior per Growth sales year-over-year. a revenue up finally, marketing value, change favorable revenue Third prior actually to was year. took within to sales several by base, quarter basis coming an for ARPU add-ons. higher continuous automated year. in allowances XX% sales SaaS XXXX to going the ARPU with bigger to steady tiers the our in XXX million, mix base higher ads to leads prior compared driven when licenses was clients, in uptick in additional a increase sell Up and year-over-year, XX% market of growth the attribute in points seat revenue average XX% was at ARPU our sell allowances XXXX from up improvements subscription factors unit both We in when services and of in increase priced to when the to $XXX, relates year. client $XX.X up in with and SaaS cross compared compared increase

year-over-year a XX XX Third X.X%, basis quarter point and basis was improvement season SaaS improvement churn point sequentially. a

engagement XX% it for in As reporting Joe as efforts we and the point our driving net this reflects quarter, dollar our XXX a forward Season will additional and SaaS be improvement year-over-year. now Grant metric reach solution. for going alluded to earlier, basis best adoption retention

Moving services. to marketing U.S. over

Third the quarter for The expected of schedule books over print prior year-over-year of on compared of X.X% a published significant that included the revenue by a increase when guidance. schedule. was was year $XXX.X based driven an million, to ahead and quarter was our publication publication number performance and

Additionally, specifically came our above expectations. in digital our offerings IYP

accordingly Given for these this positive developments, revenue our over we performance. will guidance update

with billings consistent XX% services were a Third million, decrease quarter marketing of and $XXX.X year-over-year previous quarters.

with investors’ to performance. give in consistent decline provide a billings steady metrics previous insight better our shown billings investors marketing services print segment lifecycle As available month Investor operational we is and very our will third our our of lumpier be consistent provided quarter website. into show calls, The additional operational This and basis in which data on Relations is will our an uncanny XX is directors. supplement on the our to given

for million. in to was guidance. publications revenue is ahead related of the on international The to the million Moving quarter either International, reporting basis reason for international timing revenue quarter. of Thryv $XX.X print Australian over the and Thryv On third was XX.X performance a

profitability business. to now the consolidated Turning for

gross their point quarter XX% excluding XX%, consolidated Third adjusted its improvement for adjusted XXX was When business. gross international margin Thryv year-over-year. margin basis was

quarter EBITDA Third total resulting million, EBITDA total $XXX.X in of margin adjusted was adjusted a XX.X%.

timing around U.S. due in adjusted came print quarter services revenues XX% came while at in aided margin Third to by marketing strong International EBITDA margin Thryv XX% at print publications. EBITDA

in market SaaS was EBITDA expected, go-to our margin to lower last to due increase compared year. As investments

negative to EBITDA QX, negative XXXX the full to with $X $X for SaaS expect at around year million. XXXX expect we to and We million margin be for exit

third since new refinance repayment the brings to of our acquisition cumulative associated the our Finally, term in March. loan million for we which million term $XXX with quarter loan the repaid $XX

debt continue very We pay on down. be to focused

our Now update U.S. guidance let’s starting with segments.

to For are U.S. our guidance million our $XXX raising SaaS range revenue million. business, XXXX we to $XXX

For are our XXXX to we U.S. $XXX to updating guidance million million. services, range $XXX marketing revenue our

with margins be annual prior mentioned will As services EBITDA marketing earnings on calls, consistent on an years U.S. previous basis.

we website to IR back information. $XX our $XX Australia. quarter fourth supplement third the revenue International, our additional investor Please on for guidance over quarter updating Thryv now range turn Joe. see to For I’ll to million call posted are our million

Joe Walsh

SaaS receive net scores, We know it APPEALIE an think just where our to easiest user to you, software the awards what’s were the feedback, really punctuate looking you all use And software, how really and Thank acquisition time. party where better or recent award, all to on And our we’re at analysis use together several excited research customer there, variants, financial an promoter are most strategy. Paul. results. higher and good. about excited talk the about little which third and customer recently. what’s Capterra award our they is. like I success other or the It’s product APPEALIE I’d interface, continues to received is SaaS X.X we see appealing receive platforms. about. to bring we’re that to software stars GX they a good here award But I our talk getting improvements,

investors, meet justify We’re services this. when just going often our SaaS businesses asked think with to about we marketing our way the we businesses. I clarify or justify want not or whether we’re to

make like think team, quickly. here up the are a We expanding a acquisitions. speedy rapidly grow it’s think in We like to we small experienced way aggressive appropriate marketplace, company migration very SaaS, we business we do to that scale acquiring it’s should a to to be

is And lever SaaS first so looking the acquisition. that at we’re

additional anything our to have accelerate of we’ve bring But in don’t number a at number SaaS very announce growth look companies in additional that’s of different company. customers conversations, the focus looking SaaS recent at acquisitions the primary in to processes and type capabilities talents, I months looking today. We and been in companies active, the of a active to to bring will acquire additional SaaS and

marketing Now keeping do something was as our it and be business, businesses. we here and that relates SaaS business it a have and and return not do. some of They’re we space certainly of if very unique growth an those for like many crystal to eye we’ll services set find enhances we that clear, buyers to is sense and opportunistically, our on can it on it skills feel that. really the investment rate of flatters speedy, It consider makes payback

can in a you put So sometimes which price. buyer resort has we favorable can the last be where at of position a you really acquire

how planning for excited Investor We’ve our will on can about New you to go that thinking we’re to of March, a got for strategy out York really in Day City, So and coming we’re we’re opportunity about that. an lot a that of be going Day acquisitions. do an unveil in that’s person, Investor look into detail. that registrations But on lot

this going So I’d to Officer, get at ready the going we’re to be to our is Product questions. Operator, can the to joining Cantor, do time, line Q&A. Ryan And questions? who open for you help answer us Chief like up

Operator

[Operator Bhatia Arjun comes from your of Instructions] a Blair. from question line first And William

open. is line Your

Arjun Bhatia

positioned Perfect. at a fast much XX% and continues at of we - growth, the a going plus two over growth time that ahead SaaS to great direct going next the for business think of one accelerate year. the we’re when year you, of strong were end well ago, the and a goals on years one was bit you’re a XXXX, to XX% here Thank accelerate. seeing by XX% into growth you I through to rate little see And very XXXX. now to sitting congrats listing that first Gentlemen, maybe

putting of light medium about in just you’re growth can give some well up ahead thinking color how long So on the us schedule? maybe you and current of you’re targets term your

Joe Walsh

great That’s question. Thanks the a for one.

asking business understand had were the being and years, meaningfully by our were running cash in company of profitability. about the it a return our a stance double number prior for so changed as things to basically year we distressed EBITDA is We group, One our to a SaaS for business. we margins, of digit owned debt us

a are at the that board than why legacy of were marketing the lower discussions business were margins on the some on And services time. little around SaaS the table they

So to the year did that basically over we little assembled the we’ve talent made was decision confirmed that of quality software to a the a the just a really product company a enhance dive board into business progress new of more to the growth software. to and development engineering us invest and permit the board real people of the a change stance made in a in or and ago, stance deep more

what board the the the had change acceleration direct that into momentum is so listing, see of new part good sort We lot the me through of is growth starting coming don’t wrong, a due the a get flow business to of And now. you’re to oriented but more stance. in blessing

early and And we came talk small we the thought we to the said us about what ask business of the double and about were to. that figure company, we when urgency talk really cloud. comfortable, like a our to base business talked in customer public, that’s of results this Part just the in meant. medium sort you market owner like, just feel growth really on they when other talking the started small always very would is about all kind embracing people of arguably out. so transition in revenue cloud understand different or the this, part and cloud hold rain would sort and seven didn’t pandemic years improved go increasingly Arjun generically there’s we six thing, ago, the of the and and we the an stuff could overlay Today they admitting We orientation, the is in And this to that other term. of one to the that felt

I couple do and is small to what’s they really nation. think us And clear really and to so as use manage now turning things had category some the with are lot really down listings, are was customers a happening And website I we’re, of they our well-positioned a a for leader across and happening want other good to think, increasingly, so this our a businesses the deciding engage bought they’re that, offering, was tool. initially starting and what who

we about how of that’s growth along. it. really think propelling sort that’s And been our So

Arjun Bhatia

that’s in really your it customers on on what with is And business, expanding the then, more growth longer balance engage of how very your these the decentralized, I’ll shows can saw, new side is interesting. we customer first is and growth help That’s, focused with helpful metric you you about future strategy us in leaning existing customers season the seasoned the versus two stay think that the like equation, of color. Obviously, more acquisition? on customer in it new they offering SaaS say, those features there as launch pricing just models. much power

Joe Walsh

look, mild we of lower simpler unbundling point, market there those power, before price which that we just with sort and down doing, pricing do going of price some a been that offering. of experimented sort when we’ve Yes is that some gradual think is there’s talked we’ve about

to, We’re to down try don’t we’re be want clear, pretty we that there putting business. some in to price to

so have of out. a we And upper forcing that of some sort

of more more services. generates is and of which seat in our offerings them just of as is ThryvPay, keep we buying buying all little the really forward. be It’s more price But that adding licenses. some mixed lot the It’s products time, bit of add-on It’s there’s using in we and bit a price So increasing little we as a there keep more they’ll have going here bit mixed revenue. of little here more. customers and it a

improving. some that and are up them came to actually to of on higher levels is of levels are of their moving the them Some entry higher in Thryv, level, now upgrading usage our

though models, because are And continuing then, or a to third the marketing out ARPU So We something, modernize that urgency there internal sometimes About of saying services definitely even hunting yes of do have think customer said us over feeling coming grow. existing we and a years, to in definitely to more lot our more a there’s believe call couple our that base last now they’re zoo. customer in they at new little the no might acquisitions it of still so now. face. our looking they’re

up And in. new new going a so we new in That a the are to at acquisition to sometimes revenue of all And we’ve team business all think then doing And source really be and we’re the nicely. our to, XXs better the we it customers and of our coming or spoken we’re continue good stuff. strong channels, climbing percent monthly call on better that’s basis, quarterly activity getting that is different them figuring that things out.

Arjun Bhatia

I scale, smaller ins for here, planning some think M&A the one just a bring we might how that larger see the the think through And size new we should last me to floor faster of before help you’re end pace acquisition from strategy you than at think help the a that range of the as SaaS this, SaaS about us range When strategy. you feature these could may tuck that market perspective? and a of or on organically might scale the

Joe Walsh

valuation. I don’t SaaS carry with look, be honest will you, currently we Well

as dying business. valued a still We’re phonebook

mentioned short some such weren’t discount get company to we a there where really it tremendous to SaaS because stool, this and processes we we’ve very not So had make that is really we’re SaaS difficult. SaaS go many many, many doing earlier close, I year makes we acquisitions at other working to in big acquisitions. got our tough. relatively And ability about great got participated conversations a making able but just

we be think that ability look will acquisitions maybe think reasonably software, year actually. think company, of to of just into I SaaS And acquisitions quarter make And realistic a as SaaS will will more good quarter change analysts maybe next is. valued not our large after very continue reliable So the some We ability SaaS we growth. early actual larger take part how We that durable come at it make as good change. as will today. after our it’s believe unfold, that to just a to really generate true as quarter to XX frame,

because have trying their valuations other time market For in some things. that power, exactly look hot, now, the companies buying these might to actual other or Arjun participants with buyers’ not of these very they’ve at because stuff assets got horizon we SaaS be are things, better smaller for on that a markets to buy than paying similar side sent The probably venture got of as you the full know. have less price just

So And long on probably I side. bit saying that’s then answer little a a think smaller it the grow. I we’ll winded starts think

acquisitions very made and As time large dollar approximately acquisitions. We’ve together. multibillion XXX our together a we’ve team, made

We’re very our do skills, do That’s, how along and of and We those. it to roll do but know particular at to in those. those. we making how good know is also set big acquisitions, tuck that’s

So moment, in a stuck little think tuck shares to give and opportunity. probably bit for start our doing until I rewrite the we’re us better

Arjun Bhatia

again the Understood. you That’s and on the strong congrats taking Thank results for questions very helpful here. color.

Operator

from the of Your Berg next line Scott question Needham. comes from

Your is line open.

Unidentified Analyst

Hi everyone, appreciate Scott my Levine question. taking for this is John on on

verticalized product verticals of the particular in demand new CRM functionality, Thank demand, outsized platform and of particular? question, some you. just First are the the seeing a uptake you any how’s from

Joe Walsh

the the the we that bits year, put this landing make pages place to Because Higher, investment of all the work. build really good all work. the made was to a So both, tech it’s leaders make and that in big a area virtualization that and question. the out vertical taxonomy to

terms return of investment anything seen really on that through XX really yet coming forward. that’s and haven’t in You

XX, improvements the any that think financial of we’ve made. But kind will progress meaningfully. really with pleased in begin I very We’re

legacy it As attraction some our far in as to do just business. has verticals, of with

services, a and where have a health Our car legacy traction minutes number be tend allied lot got All of relationships, to of a tremendous lots traction of of seen of with those personal in services, marketing businesses and home has services of and kinds traction type we’ve service seen so it. business legal, a areas. lot lot services in seen areas

it’s results be we’re think the showing anymore. it. that great year to you, to I was building really think This terms in that’s going XX to of store off be So going a I

Unidentified Analyst

inbound put you’ve the partner. market And four the you good. as go-to multi-location place quarters place second, three just past channels in over over new several to as that sounds Alright, that put to then the in motions far

Just seeing Thank you. three provide are increased only franchise trending multi-location demand little wondering you granularity more if those if you’re or specifically, a how not could businesses? on for

Joe Walsh

today, to Yes. runs here those with channels. me have Customer who our officer I Chief happen

I’m to give the going ask Grant? on in that channel. we’re to Grant color Freeman making So you this some progress

Grant Freeman

thank you Joe, and all hear strides now? channels. Can fantastic making you. of those We are me better Absolutely,

acquisition if to that this you our in over year-over-year seen at it from year. channels morning, you is As we packet, last a got have new sales from Xx look the chance

did as of just franchise to it well. all channel, Our getting well. updated sort retooled channel. here tech than some great our seeing as has program, for And we’ve our And of a we’re excited we of version is traction affiliate signed point newly this re-launched also about, already partner stack in more our logos year which enterprise, units there as we sit today to some is in and last and which acceleration are addition really which

trajectory those the well channels. going all three extremely So for of is

Operator

the from comes of Oliver question from Baird. Rob next Your line

line open. Your is

Rob Oliver

Great. Joe, Good taking morning, my about for question. guys. yet macro. nobody’s you the SMB asked Thank so

some about think that. we’ve and to strength, Obviously, guys really which with strength think you which good amount strategy time the I ask spent and on I products numbers growth of fair a the SaaS RPU of understanding. speak from really I’ll the

did and see dollar On sequential the down customer other ticks retention hand, in we ads.

it I you and been cross last is there’s of currents So Is of more post on just, and kind going lot macro. time something SMP on seasonality, that reopening. a know was summer there I spoke,

that So And with into feel year-end a and had what then up how here follow quick you XX. and seeing I sets just curious up. you’re

Joe Walsh

or businesses, on that okay. have going that’s people small mentioned previously go the we say half back scares finding summer are live had and the I been And in. and other a And people only don’t yes. well, we’re of after period answering to saw. on right strong phone lot It CDC said been very the sales through Sure, was the in strong the a that back. all summer, by what there meeting I a vacation. Delta very and I YOLO and did was was is you anyway, I business of the was thing the inflation shuttered would that early vacation, can Labor the Labor answering firm comment very were people end, part of quite maybe Look, sales did. their bounce and summer, that when confidence, has But summer just talk But because our I play strong out them. know. activity think continued we people Day mix the one back our the and to Day of up

in spending that. think I all some as as Washington happening massive don’t agree things the some far just them and of that with are of the

I kind results. really honestly. around are that, of or some harmed But affected think it there hasn’t our delays

think, is own, for We I the really of the wave this think to wave the is the forming like my earlier, continue I of in big into mentioned, comments I well. us. type still do software as desire its in very part front And of coming is

of a adopted more XXXX is think the XXXX, enterprises cloud in a to decade there think now and where last the And is adopted a as SMBs and the are lot I there that I decade decade SMBs, we’re enterprises. cloud. decade

be I really big top surfboard our perched So is it. going to up think And it’s on a right way. of

bullish am forward. looks going on how I this So very

dollar continuing retention that up. you not net about So it there there’s in one made rock comment to little

pandemic of look were are activity, lot offering at pandemic we back SMB. for of There’s with When dealing the credit. lot look we that a a year-over-year was We a back, noise.

wouldn’t that trend. lot these I noise a numbers. there’s kind as in take of of So any

that huge you quarters, think the I story think is at progress NDR the up. if prior going the we’ve that’s back as few in made I look

you’re think not enterprise this that to I I listening just company. an statistical looking remind everybody little number, at noise a software we’re and want

or to is and it’s XXX%, we to going we’re that. some get going But retention. going dollar numbers not one, to XXX% to or awesome A XXX to not bigger get to than see us XXX% going XXX% You’re time. net are have yes take us little a

SMB. We’re dealing in

We’re not an enterprise.

to what’s at of the we together. but three happening this, us net really, just dollar last still available to look that’s don’t read want things retention That’s still please are coming that don’t or four going And and trends. the with drive all into that so anybody all I really that really your up, on quarters story net think well dollar retention

You’re It’s statistical no aberration it. just on in news looking a that. nothing, little

Rob Oliver

marketing numbers? Paul, I just continue that which billings I you services it. and down you of light and year-over-year, Thanks, of on variability understand for remind business billings dynamic comment in dynamic did that around in but some was to appreciate the one reported how so the color. remarks know Joe, us prepared helpful your about up revenues to Thanks. were just the of

Paul Rouse

Sure, absolutely.

were of saying keep call XX we and the on because months. lumpiness each As we the reminding everybody earnings the schedule of of

one what up quarters is with weak publication quarter So wind strong and quarters was to schedule. the you strong and this due a

probably and the quarter for great strong. not that’s And be see information is to that’s is to great going reverse see, print published quarter we’re trend a going And going time, going can why specifically that service happen the last might just the the stellar gave you the over rely think to quarters schedule so trending. there very be you the quarter we numbers given we think fourth as fourth print. in year. that marketing and the have in over metric you in trend I What’s do to the not we it’s a and because those it’s had math on yourself the of can been have on XXX additional more, gave you should billings directories so to going I up

really it. So that’s

trending for where we’re year metric full accurate more view probably the is marketing services looking of you’re be. at If to billing going overall

- that does answer So your or question

Rob Oliver

color. It does, Thanks, you. Appreciate Thanks, your Paul. guys. time, Joe. helpful Thank

Operator

the Your Moore from CJS comes next from Securities. question line Daniel of

is line Your open.

Daniel Moore

engagement beyond morning, expansion are primary some first Good and this questions functions or of find morning. additional color therefore that the thanks just you retention? for the Maybe driving are what product and functionalities taking really the ThryvPay other

Joe Walsh

great for asking a That’s question. Thanks that.

ask to I’m a with thinks Our engagement comment bit today, is us on the Chief Ryan going to Product progress. where Officer, Ryan on Cantor little he

Ryan Cantor

click, get small and incoming right overall Obviously, Joe. the respond. feature is one into customer doubling When prospect a were that from log of or that the the down primary simple what Thanks, drivers either communication platform improvement of centralized was one they a businesses inbox engagement. effort is already and a inbox our on can with seeing still we remains platform and big in that

into that time next channels step all a turned facilitate additional of messaging adding natural To us. So inbox also centralizing became a for and we our platform. communication real that

success. like has last that overall and packages, report and Not and And Facebook customers So time improving everything customer estimates items our chat, platform SMBs in platform they products, payments year, Instagram that a real and others, to operate we’ve way with paid the between SMB. of to web your want around the Messenger, messaging anything really any we over you everything another but move allows customers inside are everything added manage We the we’re in and been of around from along. Messenger, communicating as and to from and take category fundamental the to kind can just here payments should of to. think take SMB the deposits invoices getting platform. to payments ThryvPay, with imagine money payments your the as how our pretty ensuring to dividends we they the that area focus really And seeing kind general payments,

Daniel Moore

and initial And maybe seen Sensis initial is just achievable and XX% or timeframe? in SaaS even talk thanks. the that for reasonable we’ve and solutions still International Thanks. penetration that on Perfect historically uptake a whether about Australia conservatives

Joe Walsh

yes. with start I’ll

they they sure profile accepting everything all early were careful getting boarded the early This misunderstandings a been of of the And software. making the on place. that were a to just going in they that software, two really we’re are very little penetrating fabulous signs year together, localizing client using about half thesis And still that our were that all We’ve no customers here, closed that those pace acquisition is were comfortable companies putting correctly, ideal actually that the customers bit there. there that we that disciplined, good in time now. out We’re very be intact. March are existing in

So we beginning they’re small, It’s go. really customers. happy of to refer very really, group others. have a getting to already And engaged incredibly

to just into to we see you’ll terms as begin wanted gear XX quickly good it few take shift to time rush the really an We sales early outgoing term. to sales high and we didn’t for And want we customers get and way, So influence bedded to into start. really a in ramp outbound in Australia. long wrong very the a of the it up the effort down will get to shift make off

penetrating So base. I idea think you that of can be with that comfortable very

Daniel Moore

one strategies the Perfect. and quick. towards confidence any two or I’m natural towards accelerate it function wondering solutions, etc? is different Appreciate M&A really simply opportunities and and the pipeline color. it’s for helpful we’re Maybe or on to profitability, skew services of marketing the a and revenue, shift But wanting SaaS in extension, shift more going. a is appreciated the even color The obviously

Joe Walsh

a we’re look a company. about SaaS company. mistake, night building we That’s think morning, noon no SaaS make Yes, or building what

SaaS potential the company. customer acquire So more if Full in marketing business, animals that zoo. the to it goal services were would a think we a stop. to really of of acquisition model building adding efficient a there’s be We of service

can to something we’re there So can kind time or going we’re easy we the can low people those But lot a a done it. price, not, can’t those that. refuse out of by spending not stretch if become it. and that of at if to not do there’s source do certainly going be I trying opportunistically to we will we’re distracted cost will But that do friendly we a that’s we are go have that, not with cash away. turn mean, conversation

our is out So It’s there other to pipeline just not a priority. do. things or highest there

acquisition we’ll So if made times cash pretty the any keep we that mean, come a to you add with EBITDA fit. I like Australia quick they’ll we look across two posted repayment.

And certainly it. that model made sense do have will fit others that. to we complete it of at look if So that that sort

Daniel Moore

just me kind thoughts flow in around of year? for Make Thanks. for the progress. sense. cash for Paul, Congrats the Last free remainder the of any generation

Paul Rouse

free of thinking flow. is probably Yes, quarter’s predictor next flow cash look quarter cash I this cash a flow about at

Operator

question of next comes Securities. from Your Zach Cummings B. Riley the line from

line open. Your is

Zach Cummings

morning. results for Yes. and my strong again Thanks Hi, questions here. good taking congrats on the

what’s of in add guidance more working by you’re the the EBITDA you’re think the maybe extremely mean, you’re making ones about were the key there to that call. wanted mean, thus analysts in as fuel that business, I we the focus given. What thinking I well been the well? far, areas? areas essentially ask been adjusted key going to that when different that a on lot are are the I already But, fire investments I investing you, to Joe, other or asked by implied in have SaaS these QX,

Joe Walsh

product. of ambitious have we’ve lots moving we to The pretty that had, but us become biggest along always want it’s customers here. engineering got a even as got sharper is we’re needs, roadmap and focus for And fill. have We’ve single these area

product focused. and really And engineering so it’s

lot be since let’s we’ve of driven we’ve got that, and very, and of lot We honest, when a growth. very we a learned a got and kind nuanced, we’ve process was the had this good the product very started, it in refined a We’re now sales sold product. out crap of we simple since it and

big and engineering product of resources has to that. things mighty lot. that pretty superb. we mean, a But a been accomplish are they’re building team. our want do. and want out And I roadmap come to a they we They team, we’ve that to add with So

year seen I or kinds this the things of don’t the through it much we our the area. and you’ve they substantially this following we following payback but years so get you even year with on like in And it our it’s of have really more that enhanced or that blessing year. And quarter, those the granted us out, think last in the investments of year investment aren’t, don’t a come board two

in XX. I it think really quite you’ll see

there. a I we’ve that got we’ve fuel, put in guess, So lot of

at made side, decision the machine opportunity there. the in to actually of year our single part, and the digit the went very EBITDA more see the would a to upper with and board, saw that the as we were SaaS we it board and just think come working So that out in that around business year and where through. of And set you’re began on stretch level, lean marker little through want go growth want to starting the team to now into we as or we’re more the the right we concert on now. well we a and whether breakeven thinking we is run a probably we things that really loss SaaS is with same market do see there to see as but I The XX. more, growth a or about consultation to And our going opportunity not XX that bit you’ll

We’re not time to the this. be right anymore. early It’s doing

Zach Cummings

extremely Understood. quick for final That’s one helpful. Paul. one just And

you extremely of talk terms mean, for gross in really gross drove about performance factors QX some I strong in that margin, of In the can mean, margin? strong that quarter. here I this

Paul Rouse

a extraordinarily to strong and vice decline product Absolutely you business versa. profitable quarter an where any and as gross print volume the strong know, have is going have you margin print you’re

gross the primary driver margins. margin that’s print that improved So our is of

Zach Cummings

questions my taking congrats strong again for thanks Well, results. and Understood? on

Operator

the from comes Ryan MacWilliams of question final Barclays. your line And from

line Your is open.

Ryan MacWilliams

just one today. a for make difference me a can year So what --

sense, have you for kind that ramp you now acquisition. your customs go-to would I of or with platform, in agree place, product the the right normal Now, market capabilities makes

some geography, something how it going SaaS are the there? characteristics here, improvements or certain what in key of after acquisition, is to more going So looking we’re thinking for you’re product

Joe Walsh

was to to a can million it’s geography But look, really bankers calls get go and really become of a adding going from we a so that ways question lot me we’re almost a unidirectional. that. like that is You’re global There trying player.

and we’re U.S. the thing. for U.S. And until pushing holds outside so crystal the the we’re That’s clear, be acquisitions looking now. opportunities to outside definitely

definitely thing. a that’s you that geography, on touched So

to mean we something along. to than vertical I America are startups maybe what better and our have So war out talent that we a what of more some more a time really into sure people have on have, that campaign could there There find we that going drip us There There it’s really there is a burrowing maybe add. some some and a function. definitely spent or software smart time developing bring or is let’s either additive just we capability really added players or there’s that bring, these that team functionality. us feature or be really interesting for and in go a is that accelerate talent. is and could to spent

getting there’s poured the who is people venture aqua that sort they be just bunch and maybe a of customer of of X,XXX add of sort commercial over and mind So never we And are idea. our really backing hire out bringing Then got it traction that porting it. and onto had and going. amassed they wouldn’t in there and some platform money customers

can bunch a of look of are I them there’s of you us. at would that green different And all ways So kind for it. light say

be so around we that it of forget are all believe this I remember acquisition early enhanced mean, reviewing those number kind has six years. still days, only on how could we that and you there so through thing opportunities But of, We’re and we’re that been vectors is fronts. big really fast.

Operator

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

may You disconnect. now

Thryv (THRY) 11 Nov 212021 Q3 Earnings call transcript