LAW - Earnings call transcript Q1 2022

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the CS Disco First Quarter of Fiscal Year 2022 Conference Call. At this time, all participants are in a listen-only mode and all lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your first speaker today, Lee Robinson, CS Disco, Investor Relations. Please go ahead.

Lee Robinson

you the us first financial thank call today’s quarter and discuss to results afternoon for on joining conference XXXX. Good for Disco’s Co-Founder and on Chief Financial me today’s are Camara, With call Officer. Executive Lafair, Michael Disco’s Officer Disco’s Chief Kiwi and

the provisions opportunities. of market our call, second financial our for pursuant During year and Harbor financial update full statements quarter Litigation XXXX, quarter quarter including, and Private we XXXX, growth the our discuss including of Securities XXXX. regarding opportunity, Reform review XXXX market Safe but will guidance the outlook, fiscal statements year an to second to year Act fiscal and will for position, include Today’s guidance the first our not product today’s results of limited for fiscal and forward-looking call the our strategy, on

prepared In and today's replay of filings, addition earnings Investor to website SEC be our our press release, a on Relations can remarks, call our found irs.cscisco.com.

known involve and achievements cause actual different and risks statements implied the Forward-looking may forward-looking from or be materially by statements. results, to expressed uncertainties our or performance, that those unknown

XXXX, filed XXst, and for April SEC XX-Q annual Form on the statements ended year the assumptions the of date could SEC December in XX-K from only Information section with Risk on quarter beliefs management’s the the titled included March Form report that XX, February represent the the financial Factors affect on filings as upcoming factors company's XXXX as results XXth, for on company's of XXth with amended the our made. the in Forward-looking its XXXX. XXXX and in time-to-time, including ended

GAAP or are we A financial accordance to their to today’s non-GAAP call non-GAAP in superior equivalents with in that, a during for GAAP. of like and measures in the non-GAAP substitute discussion of addition, measures. These limitations release. the will With versus a financial GAAP measures over our financial non-GAAP prepared between of and earnings to not performance Kiwi. and closest using I’d is addition measures call, turn reconciliation financial In discuss measures to available

Kiwi Camara

actually joining how we've to industry create be ethos of with that Thank the future begin Disco technology transforms technology that our technology legal outcomes is continued and QX way. tech-enabled excited most in platform call. to innovate financial terms, of and a and importantly, goal better achieve legal. built results. frees our be lawyers XXXX powers practice In for our the I'm XXXX way to what the we've comprehensive proud of overview continue the to tremendously of works. will offer you legal earnings our more about QX simplest of I Disco that law, to build an to I the brief efficient a a legal

We another across growth. for are $XX.X grew we pleased the had Notably, record March quarter of strong growth million, Ediscovery up to have year-over-year. achieved revenue in usage a X% month to business

adoption U.K. to clients, team. expand with in revenue results multi-product and our across the continue continued continue These year-on-year to nearly part of our new usage Our international win and platform. to clients, reflect attributable to increase doubled our ability expansion existing penetration

CongruityXXX achievements by Historically, a of and modern data needs tracking and such value access move become save product hold the The other Our process building go-to-market I in new corporate and With we legal this portion automates to few platform and necessary our our and the organization market solution to and this successful work that the with product comply products simplifies execution and DISCO software-powered critical these adoption lawyers shifting at with legal mission some first will Hold key record, build in excited or the Disco legal requirements legal to larger of assessment for and start value XXX. technologies few by the to our out success are that preservation has requests. gain particular, a of place continued with discovery in-house departments In manual growing connecting producing scale corporate regulatory value see new department's the legal value who excels subpoenas of acquiring a a stories. with In to data capture products pressing more of legal our needs. cloud customer acquisition, XXXX, organically to illustrative off which platform by of capturing from QX that. and increasing closer we a in team segment product for demands. chain meaningful chain, We requirements, we chain the complete have a the is enhancements to acquired a from the growth point highlight quarter corporate and the to the continue thrilled customers. our continued of of add and capture our to approach. solutions expanded QX, with builder. address as disco volumes of responding our LegalHold request Office early DataRequest the dramatically and that must done we completed like products case existing enterprise systems new access came that and in data entry In of to holding We're case corporate corporations most technology-first acquisition,

clients ported whole following and are introducing of demo to spectrum to and clients Hold clients We a use and Request. existing the and more all completed the the we to than close the Disco's the Request products Request Disco Hold full Disco of over day stages the acquisition, existing per presenting already our as at March Disco In that Hold product. early of and

our multi-product integrate This fiscal finish. streamline processes our year motion earnings XXXX broadening strategy expanding start As to our the over is and annual Request clients consistent on vision, Disco strategic legal products from platform the our which we helping look we and of we our our in months, to Hold call. forward offering fully discussed with coming Disco their go-to-market

clients Our corresponding in on to spent documents to to focus measure per per performance daily tracking given AI choose managers efficient. their customer or the enables enhancements assess and primary customers of one time In more were a app, time and which QX, make continuously allows to reasons review. daily any easier, Disco. hear spent is on We how legal satisfaction. lives processes and productivity, pleased experience user customers key Disco's document We and the innovation drives lawyers This rollout feature and time of use of spent the view time we and advantage including improving reviewer in competitive that doc. they from introduced customers review, to report reviewers is hour, much metrics and on product

reconcile highly we in allows customers to requested activity to them. entries customers actual be was feature the time from using tracking review addition, are to offer app thrilled with to and In spent able billing time This for a discount. it

also application Case components part between Ediscovery reusable native products We shared filter and Builder. Excel capabilities our as architecture the and to reduction like Disco to is of that is our released enhancements

all the Disco a We are review, provides can with Management annotated on and in depositions from best functionality teams Today, also Builder. New view all screen in depositions, and pleased litigators in annotations export testimony Case edit seconds. single use a or case evidence their witnesses platform's from page search, announce motions of across trial Evidence of which practice, the all for to holistic

impact, aspects case testimony readily take across using a continually annotations to We analysis on the compare core the addition and same of otherwise screen. of to seriously deposition and litigators compare witnesses in of Now, confidently use a build a our could, of the more strategy. depositions use to evidence and they invest more platform. across page the Equipping to make faster platform case corresponding with evidence are select in legal to empowered teams far multiple best case That prepare presentation them allows strategic is and but than performance not key video video only improvements also of stronger clips, performance side-by-side development of also faster. excerpts and products our identify the for winning witnesses to potential

to have to corporations processing experience pipeline, user data the and and for data measurable our we with of speeds. have with optimize efficiency and that critical types deal make loading We rising document continued volumes ingest to and improvements

our we go-to-market expanding In pleased addition of investments team. in progress to and our our productivity the with products, are

team. last the our and carrying are we As good build past, In ranks go-to-market we'll our progress that goal. reps have about quota plans organization, year, in and we've we continue to expand that we to ambitious toward talked making doubled of the have

we teams, of record excited other product who to clients. often and to introduce hires, sales more representative and existing a with Disco upsell many aggregate addition the results. first in are identify per are prospects to whom cross-sell or productivity effective solid and our success quarter. were In investment development the generation across growing growing usage seeing had basis see quarter any opportunities business who the than disco people in And on and customer within win our scale, many to recent team, team, in expansion head cross-sell Were a impressive our initiate lead generate are of

and continue to see results momentum As products. our in demonstrated base our we great by client QX, across

organizations done prior clients, calls, can in anecdotes our is how earnings our in demonstrate adoption clients quickly expanded be how platform used to across that see legal we've As Disco benefits by and customer sharing the that enjoy using we clients Disco. the and ramp,

This quickly to to usage a trends their landing flexible more make quarter The of stories and discussed key our review their corporate we're and Disco. product This Am our decision the model, ramping Firm. corporate clients, where was choice clients through was one previously, clients their to increase where XXX continue partner informed than and client driven the our to Disco Disco them needs. using of platform that Law of try Ediscovery One is usage client multi example allows on and which a and ability pricing counsel options, simplicity and transparent great larger are the product usage introduced within financially first a disco became external at is to using by one initially more and seen we've product. offer success six-figure clients new a Disco an

met premium outside counsel ability both General client slight general Counsel. pricing an The solution corporation's their when process. to review on counsel case picked appreciated data discos and large preparation boutique for new corporation be win our through parse around to Deputy a disco our Ediscovery expressed litigation review, a offer QX collection, the total the Another Ediscovery not team, for the yet to on have outside they start, and case. case. they've their working to a of the to corporate where the in had sales began fee, hot team and there ability in was a documents the for a demonstrated the documents Ediscovery To received with the predictable, data software. XXX,XXX manage our as lot Since mandate, found was They counsel guaranteed our team from on They with experience the despite daily updates they've including appreciation provider. flat

forward time completion team's ability to with the secure using completion deadline. experience initial user themselves of their documents continuing the the in hopefully through and look trends a their review under long-term AI trends Disco's Our the matter client discuss these and new this We of follow-ups relationship. and to ultimately work to the and Ediscovery to the see

than viral talk Law championed or with usage historic a and Disco has of multiple among to a new and firm firm, This firm. is matters, partners multiple This lead on the This matters a defendant new steadily review for usage quarter. had huge example who multi more recently over product client they been a at getting Xx and added notably, over large, has the matter a Am timely million Disco use Disco firm, to a Disco's Disco client lawyer XXXX adoption its of Disco since we possible. faster quarter. a expansion. Review ramped like we Ediscovery who as under moved and in on quoted increased used review And prior and couple in points The with about. specific of his highly highest One Additionally, qX being last and by the X chose to great XXXX, more using the the AI spend case. plaintiffs Disco compared than spend at in large evidence had other new thought the benefit documents initially better, complex,

first one one one This of to agreement XXX multi-year were achieve of in their demonstrated to and to very is and innovation to law. they forefront of and want are belief clients law with Disco's Disco, largest fully their of clients, and using across in subscription relationship adopting benefits They reaffirms Law happy of at that we firms we review the our have the oldest their adopt long-term Lastly, all have adopting us. type Am clients the products.

We one industry conferences. again of in also sponsored Week participated New and City, once the legal Legal premier York

Disco. we are our last quarter, and serve continue that, to turn Legal to the to best with strong share about made our will positive In the thrilled have Hold are Disco products, excited connections and it Michael. now of and team potential acquisition organization scale product communicated to participated clients the we to to behind we invest And I'll panels, had of with demos another and summary, benefits and great thought we in tremendous as over clients feedback future. in numerous the leadership dialogue Request our the During continue quarter growth conducted with Week, who our new and for

Michael Lafair

and on to pleased I'm usage year strong Kiwi. other of of driven may guidance on reiterate for is an QX primarily impact given time a platform, any of business and the length you, quarter. quarter our number that Thank provide and based that volume XXXX. to the is of in update that details factors discuss by nature like XXXX I'd fiscal for the our outlook matters, another revenue data, and model

specified well had year-over-year. with from mentioned, growth As quarter basis. performance In Kiwi our as our note wins that results, usage from all to please customer existing XX% and We up the Ediscovery the expenses, or operating across the usage and unless coming a $XX.X prior all versus QX increased revenue same in GAAP particularly in remainder on new of year. otherwise products statement, income was non million, customers strong discussing the count share as references of increasing

was year. of up margin prior in from gross Our QX in XX% the QX XX%,

based reminder, on on a the and As gross margins our ingested platform. and period-to-period example, fluctuates managed for data of our from types amounts

compared and of of XX% or the marketing in We in bands we've expect the the prior seen. gross This $XX.X to be margin quarter QX increase XX% to revenue QX represents historically year. to was within continue expense million Sales year-on-year. of in of million revenue an over $X.X

are in focused As we've we go-to-market investing previously on expanding organization. our mentioned, and

with increase international have in a XX% to in platform, very represents across expense sustain or Resources, or to growth operations elevated to and This represents invest year. compared quarter margin revenue to million prior development than now in million in hires million in the $X.X in negative our million and in a a the to QX in of or features feel negative of key QX organization and over the couple XX% clients. QX XX% million added Net year-on-year or We we hiring, scale us net in an year-on-year. $X.X $X.X and QX in the million XX% year. XX% who and to QX negative including negative EBITDA $X.XX help $X.XX was of QX, G&A net onboarding from of the and of QX compared of QX the some QX compared Head revenue share a Operating was in Jignasha of of in further year. this loss of is the General our of of year. in in QX along XX% XX% over new due to our key was and in scaling of was of $X.X organization expertise per U.S. ago. QX XX% help better $XX.X and other of of into revenue quarter revenue, to QX expenses a internationally. X% revenue prior negative of administrative following strategically made prior quarters. of increase was loss of a of our QX as experience Overall, business. been increase with brings compared scale year. in $X.X compared Net and our loss to EBITDA started to the guidance This continue Research pushed invest go-to-market time per our the revenue $X.X historically of IPO the We've million, to QX Adjusted product, per Jignasha our with in of an loss investments prior negative prior XX% $X.X revenue that effort, negative Human million, new share was margin weeks margin measured support Grooms, to achieved functions. increasing to year. representing and share in efficient our was the cents the of we've in compared right We've prior in levels and loss

and negative $XXX.X $XX.X flow ended compared prior million was and Turning in balance equivalents. in cash sheet year. cash of the the we $X.X cash to to Operating in QX million negative cash with flow QX statement, million QX

turning Now, outlook. to the

$XX QX XX% of XXXX, representing range $XX growth we're the million, revenue year-over-year For at the million providing guidance to midpoint. in

were midpoint. margin $XX million, XX% in adjusted million to the we EBITDA negative the representing EBITDA providing at negative negative of QX of $XX For range XXXX, adjusted

invest the year As QX quarterly costs operational go-to-market GNN. as team, on grow we anticipate we in I our product, throughout call, continue to our to continue do in and last and mentioned to

range million, of XXXX, full our the to the year revenue guidance midpoint. XX% growth representing million fiscal $XXX raising $XXX the at in we're For

full $XX.X and continue For excited the be In XXXX, about strong where the the EBITDA adjusted to midpoint. summary, front headed negative negative year start year of margin XX% negative and million million, to to with opportunity representing between fiscal we're continue at expect we of our delighted EBITDA adjusted to $XX.X the we're in us.

We build teams done. fully that a innovative way will legal work and legal platform the solutions to and transforms is serves scalable continue

our to We right will in build with and place organization our to the people pace goals. attain to keep have continue our growth

is transformation. and that the turn a a in continue also over the to share now discuss like to I'd ripe for to its the market will call Operator? We leadership market Q&A. and disruption go for up large technological open operator after to lines

Operator

[Operator Instructions] take And first of you. Ikeda Thank our from will America. with we question Bank Koji

Your line open. is

Koji Ikeda

questions Thank the you. taking A Hey me. couple Mike, thanks from of couple here. for

about? come be there Any that already First, just initially quarter-over-quarter when that to guide the of down we basis, there? anything that's put off to wanted there there but understand and you okay, platform guided anything questions decline going it you of has sure, we to the it quarter should looking second second wanted there, that first sort just to with about couple quarter or out? being that the -- there thinking to be guided kind so how quarter Is it's a a calls, -- quarter-over-quarter Is just from fourth that. any that guide the at on guidance on similar and help that ask takes so the sequential matters of off When and is be in call to here thinking your be reconcile seasonal? quarter the should some kind

Michael Lafair

really Michael, Koji, Hey, question. it's great

actually based part sequentially. we've that with has guidance in a be our that's fact are can about full the basis, that with there to visibility confident down we model. kind many, the really we've have And year And our As And We're a the where feel the we our of year. you public, number, really we we're since we've on discussed usage year every very and really that approach variability into do know, quarter quarter-to-quarter full of in prudent single guidance as guidance. many times. raised We also for numbers. to guided went good

Koji Ikeda

it. it super Got helpful there. Got

be Just wanted sure. to

for maybe question, Second Kiwi.

on why a of also of talking congrats so Okay, It And people this really capability this to that wanted industry. mentioned would that drive CongruityXXX. the have adding important hold disco. the within compliance technology, technology. we couple hold And particularly What they ask enterprises? And that that about that? is were is legal acquisition legal it's adoption of adds help enterprise within it to the legal so legal you, request I

Kiwi Camara

things it's think I two So, Koji.

lawyers department First directly. the is in part of of house likely counsel, the stage platform And engage is to are with in that most the corporate the work the who legal so the process. second earliest

that about talk little a me bit. let So,

of they assessment department, you implement handled do by to about where matures, big engage business law a collect they interview piece legal But they corporate it outside out case, counsel a actual might mitigation think case typically go of If people, litigation, of side start legal case. the settle, the it handle the being doesn't if they initial holds. the the data, the firm, as they will

And so law our time, using the are even that of at though that early a is the initially case up product and a litigation. downstream representing users conduct piece firm is assessment that often and principal and to data in corporation collect company client, winds the is it

products, have So legal products that and these Request matters. the paying who's which are person of one is in Hold bills of the customer, actually corporate having is ultimately the our advantage course the of the we directly using

point The it. second use when is they

because used And is use. first. is product the the this Hold So can request Disco product then

use products by invested natural Discovery Second, in client to sense, Discovery proceed then Builder. case then Disco some time underway. is like in Ediscovery, Review, the step And The platform. deeply Case the using next is our to the is

value a to think hearing there's why you're so a solution. lot I And integrated single that's say customers of

Koji Ikeda

Got Thank for and questions, my it. it. Michael. so much Kiwi Thanks Got you so taking much.

Operator

Citi. Tyler We'll take our question with next Radke from

is open. line Your

Tyler Radke

for thank taking Hey, you question. the

a characterize and curious based the based back some economic QX? would health faster into on you. that more Thank pull models backdrop and your we of investor you little and a, concerns get a spending been kind tougher customers I'm on lot to this usage of in things progressed can the spending of the as QX perspective And environment there's about in into models. world here a of bit what extent as usage that So discussion

Kiwi Camara

Sure.

So, all, first XX% quarter, terrific a beat was numbers, and QX growth. in can of you as the see year-on-year big

in In flat terms think ultimately would of the the be, broader question, that And was accelerated QX, the in COVID, and year, And based recall resilient I we than had model a of quarter quarter that of great growth COVID XX% how year. business full usage you'll then the our more test in really we to customer QX one side sequentially QX year. year-on-year delivering for stress.

booming. M&A carrying firm bad the times situation house And what less I The project or is the of as law do the overall it's last litigation in or disputes the lawyers often fortunes to or in well, the observation might tends in a think law really then of finance indicator our when doing law firm. a that the I'll the who corporate securities, economic partners, side when times that's economy or good people make is is, carry of to economy the transactional think do business. firms, about

has disputes sense cyclical. in so historically counter as regarded litigation there's been which a And

independent the business exposure But Disco's and is crisis. what the.com counter-cyclical. is some think and that the services examples. the know I continues would you would far that so litigation people's for say about as go I legal was created or cycle. demand the Those of wake economic requirements to good in crisis, are that XXXX that legal If of to I don't all the say position the

Tyler Radke

A a lot kind for And some been look of Kiwi. now quarters profitability. of just in and and areas efficiencies pressure time that puts Thanks, Thank several perspective. outlook? your the helpful how margin you've incremental you've I'm as adjusted obviously, you've Michael, and some spending thought for company's of That's at on public been you. and if all, just for plan your you there's of there of, plan, out the year, at follow-up curious takes if kind operating of about

Michael Lafair

good Tyler, really Thanks question.

guidance the in issued the today, we raised our EBITDA and we full as reaffirmed revenue. So, we've for release, year our we're adjusted earlier

a interesting But the small piece -- macro saw environment obviously that market, billion We we are overall to perspective, from $XXX business of going the is watch. after we're market. them

do want are believe to not because going we pay so investments change in expand, spending profile, we those our as we to continue really to back And multiples.

kind sitting. where that's So, of are we

Tyler Radke

Thank you.

Operator

we'll Brent our Thill with question next take And from Jefferies.

Your line open. is

Brent Thill

Michael. Thanks

expense Just following up the on question.

With investments where going? you Are that you going? big the You team. the investments give the Or us you are loss, sales escalating again a where of on Can track? doubling all just year? mentioned do of are continuing double this the sense

Michael Lafair

lead to to continuing have. that continue we're in solution solution, out our and our go-to-market going to in get And scale Kiwi, scale market to really we continue invest down terms product, product continuing talked the team. doubling we're them the go-to-market. we to IPO the investments mean, we continuing to those the to in as those I And also on our Yes, make -- investments, and efficiency have I since monitor from of and about that, our

Brent Thill

of you families model, over what And just talk the seeing the you Kiwi, adoption? discovering in can apps and when you multi-product think that importance about you other to that time, now beyond you're have, this in

Kiwi Camara

of about lot everywhere that this being out becoming companies a pillar technology builds part that a our where strategy talked the sort I work full multiproduct very strategy. we legal core think work legal year every towards we that in is this powers I And laid think call, Yes, of done. a five earnings is

most Disco on of time you involved Hold we at of kinds Disco Case earlier that going if in or with products there Review are and really hopefully of hundreds we've time is Ediscovery process done, of deep then legal matters. like Disco Request. millions started legal with disputes, millions investigations the look what there, Disco the of in Disco So, even parts and process tens like And clear. millions, we and and coming documents of Then of expensive problematic other strategy expanded from historically, assessment, early or with one Builder, the products legal in both case later in the review

give And adopt Our using corporate and they begin where the customers with more of and to start. more idea they platform them to a multi-product solution then encourage regardless is to places engage our where can platform. to start

better Hold. a Review, to in Or a Case and it Review downstream. for natural So that the Request well litigation to Case then whole Hold or solution and And customer be platform as platform initially very find come should to that and like documents, actually, and to their can expand manage use them expand start a enterprise-wide interest to the might an with and solution. to testimony in an as Disco customer it's they can manage find then Ediscovery then with portfolio Builder implement us Builder as

more over idea them And needs. time. that points is customer cater can create discovery building that other products into then of that magic use once to have something kinds the And they that's experience. to that cross-sell Disco platform, to by legal different you entry So on the the is products

Brent Thill

that out? the beyond you're something quantify of breaking not percentage you is Or Can Ediscovery? revenue

Kiwi Camara

line. product We disaggregate by don't revenue

mature we've by can some of when original products. You our It estimating introduced product. various Ediscovery the most get products. the is Disco obviously sense our just was

Our next, then and Case second Builder. introduced Review product Disco was Disco

underlying using don’t we as introduce and we're you believe to going you I'll reason there. disaggregate more sense a because different ranking, the at So least of continue more is think to information can products ways time, just the that we of those get platform. same in over And of tell products. we

of Request get easiest So Builder drive of out time, platform platform should a our and want and is to for legal by of or using categories customer them, then we the time. growing adoption is what whether to us somehow, Ediscovery or overall which over Case don't or Review, them or enable percentage a across their more more work budget right? Hold legal capture using their we to really do care over starts Whatever

Brent Thill

you. Thank Great.

Operator

question take Needham. will our from we Berg And next with Scott

Your line open. is

Scott Berg

got I've for good thanks the quarter. here. Hi, taking Kiwi two questions. Michael, and congrats And my on

particular? customer Kiwi, today, teams is in of that customers data complexities came or First are today? Slack of off Ediscovery -- to all, were more or start comments difficult digest one might the in ancillary what select maybe the for difficult. ancillary right components with space why them of a platform might today the more some in an XX that years to it's driver we've Is firm want than of the a trying much there's law XX of the to many whether up work or data done so application video ago process a is trying so or be the because now you're recently, that call just in they that was Or adapt with that a seeing Disco applications, formats you

Kiwi Camara

Yes.

for So data. we see growing the demand of newer kinds

So explosion Slack recordings. a Zoom has then things. supporting have own huge And demand, industries different XXX, been in their specialized Office supporting

that formats companies software have need downstream some CAD/CAM, own supported construction cover, So the lot then newer has of applications. for a Ediscovery to of in probably be you many that their introduced example, of

Instead, you email. for email Slack people might to messages in I wouldn't driver. every so data, difficult you explosion that the of use that XX the one number driver Slack it's the say much not is a were driver. it's right? is is that So one much collect so file volume, So it's to a variety number explosion when The you collect the the sheer not type handle. that one collect principally when using Slack,

that what regardless drives the systems highly why demand And a is under ago, see was today documents. And that load. case that to Disco, scale a now one that documents. XXX think, big of I customers years started switch of And And documents. million for amazing are a case where, so big when law was big a trend XX of then performance And reason I million a performant, maybe it’s number even the million XX extreme remains, of case became you'll the this practicing database. a kind continuation

scale to force actually which second and can find those what's the evidence. shift thing of from away up the through in in a that's more the with drives efficient AI-powered to it way associates review documents documents brute the need actually keep is flipping The a solutions, for to explosion And understand the data.

Scott Berg

And investments drive about growth marketing about But in and indirect That's it. and these little to accelerator ability towards more think in of and Got sales the press of helpful. to should sales partner its a doubling going headcount core overall, versus how have then basis. sales? you much bit we year-over-year direct resources a marketing reps them to lot your the spoken the bearing all how

Kiwi Camara

And change the products that I remain the the services they're fundamentally industry. replacing optimistic They the partner is that with reduced of for services believe just about future over no channel products, is it the what are we medium-term, does. by adopted, the channel need building software. as the we're So secret. when they those

a Now difficult transition that's to obviously for make. partners

see with adoption six, are now. us the partners And early who been folks years for eight so in cycle seven, you who've

their are talked the beginning on in Disco. of large some businesses Disco. you'll And I a go-to-market we compete yet. effort of point on build to And there to channel we're right? top with time, folks of You'll that along, get of We on those tipping over calls. the past today But toes couple with And in see where those to believe some is every larger dip who do partners We'd them that bulk come think converting The happy we've these don't bring the of not day. who market. don't to perfectly about dependent our more water we're for But like we're the the along. channel, direct. earnings

bulk medium-term. is kind the our growth optimistic which into about of the over the of going, Again, mirrors our investment terms say is force, channel investment the the program. it challenge direct this some to in of and going of current investment is of where into very going we're sales is revenue, that So up sources building

Scott Berg

Thanks That's Great. taking for questions. have. my I all

Operator

next Canaccord. And we'll with Hynes question our from David take

is open. line Your

Unidentified Analyst

taking for Luke for is this DJ. on Thanks Hey, the question.

So Kiwi, record what April just shape to so far? into you've you month and Maybe called Ediscovery for out degree momentum the QX, what March on growth? expand May seen that saw Could the quarter in what and then a there? of particular that fold you you being implies for

Kiwi Camara

look growth And in Well, of product, sharing We usage, about our business, said. both other call. updates in some Ediscovery what we and earnings what the all on exactly specifically forward specifically what's the you excited a March. unfolded very with QX to in QX on our and spike products. really the we Ediscovery We're is we of saw sort of saw tremendous

Unidentified Analyst

Okay. Thank you.

Operator

our from with take next Wood will we Cowen. question Derrick And

is line Your open.

Derrick Wood

of raising year Great. Thanks of the million. you with kind full quarter. and strong congrats Michael, by you midpoint the $X roughly kind of beat on the looks I by guidance but QX only $X million, start your the question. back guidance it like on outlook noticed,

revenue wider being that -- than reason gotten little macro was behind pull-forward bit that -- full just conservative So any there in that a thinking Or the little more I year? a be the you through noticed of any flow dynamic? have on also you your full assumptions, should guide you have other that? QX have, any range about we or factors because didn't flow beat historically And QX the fully

Michael Lafair

the Derrick, So, thank question. not for you really,

year-over-year it believe the we pleased in was with and XX% a the against guidance. were I really So QX beat our growth XX%

the want full call. year. in we've of been is fourth our to our year, the we -- literally And I raised we quarterly year full guidance and we conference full and terms this only raised out prudent be In the think

Derrick Wood

there's And macro it you any you're year. you're clear, of demand from perspective that nothing full just seeing changing like sounds a the your as assumptions. raising be to Obviously,

not. would assume I So

Michael Lafair

That correct. is .

Derrick Wood

in the end perhaps nice having does the year. of XX% forward a just And trending focus years. on previous helpful? uptick you two then any going to Does the base? up-market customers at less that graduates revenue And showed of reflect just Or lower would of that be And reflect the That kind to of that more concerted XX-K the XXXk from the was more that and plus see focused lot thoughts how number Okay. your maturity $XXX,XXX last from market? a be level. XX%

Kiwi Camara

change fundamental base It's latter. segments the that It any the it rather than more the the targeting. But maturation in reflects both. is we're of

legal corporate and when over legal DISCO's at upfront the by time, Am relationship grows corporate have began in out time, the And then So the selling that because and boutiques. they up-market chunk direct original of started larger segment if story you're And general, more litigation departments. their a XXX the we And competitors. over to was wallet to you with of getting one clients sale, Law our to directly you it entrenched those quickly. tended boutiques look our and we a selling of then

dealing And through accounts so firm accessing larger, again, channel. law tend just be those because with to them them directly than you're the rather

on. is there So little to a going our now. corporate selling for legal underway several bit that been on of focus years But has departments

of times, they're recent seeing is What quickly. a where you're again, their about talked really, change couple in we've growing the seeing trend that and So spending spend in the customers a that's numbers. more more starting you're this numbers more out not are

it taken to four past, years seven might customer or figures. get middle a the have six in three, whereas So to five low figures,

more prepared ramp two examples year some our that more to Now but about and quickly, have talked the some the over them of of historical you some inside one remarks, of in the quickly year, them doing customers, certainly years, course than average. we some of

Derrick Wood

Kiwi. Great appreciate I color, it.

Operator

with will question [Operator take we Lane Parker Instructions] And next our Stifel. from

Your line is open.

Parker Lane

attribute Thanks you've that the basis year? And some of factors SCR in gain? best channel efficiency you this efficiency are throughout Congrats quarter. the the any strong had sales for other taking What you Hi. the to perhaps quarter, the on sales expect that that Yes. you questions. here Kiwi, do pointed to would think to quarter. the I continue in

Kiwi Camara

Yes.

for complex – of well, area focus a time, been a over year. of has this past an it's changes. And long really but us over So past the for the

we've and on the on folks increased some really level that brought performance great on manager successfully director side, and team. management ramped now who board are driving First,

the in well the of we think do in seat. I have terms kinds Second, people, profile of our who really perfected hiring

in investments big Third, LND. we've made

each other on so at on. ready as SDRs of provided careers we've follow-on mature roles calls. that by have including go-to-market about kinds them these DISCO great of bridge awareness and now experiential University other DISCO CSMs certifications University these run get or a in that AEs to be they DISCO DISCO, called on-boarded University robust at talked end, also, super little SDRs the there's bridge on-boarding as for get call programs those and program roles, so we people what And this or very our SDRs, training we have And their get successful coaching programs, organization. we in then So sales has core that's product prior learning, in bit to

a where And no focus then so continued bullet. on little every gains things to and there's those bit one of start It's about a every silver those compound. it's quarter, getting better month,

Parker Lane

US up Got you counterparts. it. that fairly today, is? would Or And productivity, room compared on say when teams international for at organization well improvement how the holding there's that just is we that to look new the given

Kiwi Camara

in for and bit Well, have Hell, I room get all I we think little a day. productivity, to better every improvement try

you and you it's salesperson our probably systems startup, do, a idea UK us whether than and that a robust to their really working measures able experiment because been we engineer CS accountant the crack to across better, we regardless the everything. clients get things SDRs take the This approaches robust of more call are with the people propagate in built and is able they've mini of what's they actually and or what's make their of them a market. success. that things we part we're we an working But then not really that analytics in a you're I and of always – see and can core of and innovate observing in heck in the can progress right, of the to the one an is of where so that we're lets is work feel organization Like, BI And out It's structure, answer values build. long-winded what right? think And amazing I or or salespeople One that And that their key the like that that think organization. teams rest and our wanted. lot, that that working this not. a allow thing

the pan and of taken of Some some those to States improvements didn't out. have innovations them United back been

to And so a increased has well. the example that can organization I way think innovate that an of in it's UK very as been US the allowed that interesting in us has both very a successful in and performance drive

there's is it's very early Of at long very behind in macro course, the a growth, we're delivered, the results a amazing UK runway of but level, it its and investing because ahead.

Parker Lane

Congrats Understood. the color. Appreciate all again.

Operator

Schappel from will with our Loop Mark question Capital. next take We

Your line is open.

Unidentified Analyst

my This Schappel. is filling you particularly date, Thank hiring for the markets where this to plan year, question. an be behind? Ken Mark taking you talent hiring plan in are to ahead tight on or like I IT and to are good you aggressive or for the would so in ask, plan you to has respect company continues the

Kiwi Camara

As plan. we are of now no

So there. while little it us a get to took

there, of as now You’ll not the there. remember, past there, described and getting sort in I calls, we're quite us two earnings but

greatly at that I only really empowers of think to rule we're work you really great not on that spike do DISCO, then from so-called terms things recruitment, opportunity careers. recruitment it's and a And to culture proud combination using of the law the other as In do and due in our to technology offering case, fact our strengthen the but people a to In how suffered people mission build of have the the of resignation. impossible recruit also a matters. the never we that to be attrition that how their a engine, might we at side accelerate that regarded places people

Unidentified Analyst

helpful. you. really That's Thank

Operator

closing will now and questions further at for back Co-founder turn no are I to There this Kiwi CEO, time. Mr. call remarks. Camara, the

Kiwi Camara

just you XXXX joining for for of started. We getting us law the to we're ultimate use At and our is your vision Disco, Thank call. the you for earnings strengthen and today. in through Disco interest rule technology, of joining thank our QX

Operator

your today's and this participation. concludes ladies And and for you call, thank we gentlemen,

may You now disconnect.

CS Disco (LAW) 13 May 222022 Q1 Earnings call transcript