Welcome everybody to Coupa Software's 2021 Analyst Day. If we can move beyond the safe harbor. It's been two years since our last Analyst Day, and we have a full agenda today, which will be kicked off by Rob Bernshteyn, Coupa Software CEO and Chairman. Then we'll go into three distinct sections for which a Q&A will follow for strategy and execution, innovation and customer success, and then delivering on results and positioning to win the financial model. With that, I'd like to introduce Rob Bernshteyn, Coupa Software Chairman and CEO. Thank you so much, Todd, and good morning everybody. I want to start this morning with just a little bit of history around our company. You know, e began well over a decade ago with a simple approach, which is just asking our friends, family members, colleagues in our business lives, how are the companies that they work for doing in terms of managing their business spending? I'm sure you can believe very clearly if you ask yourselves that question as well, that most of them felt their company could do a better job. We follow up with a second question, which is, well, how are you doing in terms of applying information technology towards solving those problems? The way you procure goods and services, the way you expense, invoice, pay for the things that your company buys, the way you do anything and everything as it relates to business spending. And what we get is a rolling of the eyes. In fact, folks clearly thought that there was a lot of opportunity in taking their game to the next level as it pertains to this area. We set out to build a category and a fast-growing business to address those problems. I'm proud to tell you today that we have now thousands of customers around the world that are wildly successful in terms of the way they manage their business spending, or they're well on their way to being wildly successful with measurable, meaningful results. I will tell you that today, sitting here, we see it as a responsibility, and I'm talking about myself and many of the colleagues you'll meet on this call, and the thousands of other Coupa colleagues we have around the world. We see it as our responsibility to take that same level of success and beyond to a massive total addressable market that's on its way to $100 billion and nearing $100 billion. We've set our sights on winning that market. That's what this is all about for us. We're approaching that market with what we believe is a winning vision, a winning differentiated vision, spelled out in the letters of our name, Coupa. The first is at the very center of the screen, and that is on focusing on user centricity. We believe that the best user interface is no user interface. In other words, the machine or the information technology should be doing the vast majority of the work, and the individual, the human, should be interfacing with that information technology platform in a way that where they are either gaining value or they are delivering value. This is at the epicenter of our differentiated value proposition. It has a lot to do with the incredible adoption levels we've seen over the last decade plus, and the ones we'll see into the future. Secondarily, our business to attack Business Spend Management comprehensively. That means each and every way that a company spends money, we want to help them get their arms around and optimize. That means using distinct applications that they're touching on a daily basis, as well as power applications for specific audiences that help that stream of spend become more optimized. We've also committed ourselves to being highly accelerated in the way we do business, as captured in the letter A. In other words, faster and faster and faster deployments for our customers, all focused on their measurable results and the value that they should be getting from what we call our Value as a Service platform. We're incredibly proud of the pace that we've been able to do that in our history, even more so accelerated during the pandemic over the last year and a half to two years. Fourth is the letter O in open. We know that we sit in a complex infrastructure of IT investments that have been made by companies around the world. Our spirit is to be open in the way we interact with our customers and in the way we hook into those systems to help them unlock more value out of the existing investments they've already made. We work with thousands of companies, hundreds of which have core ERP investments that require additional value. We are a strategic investment to those ERP investments and sit on top of many of their ERP deployments around the world. Last, and certainly not least, and probably one of the most exciting areas that we'll be sharing with you is captured in the letter P, prescriptive. Based on the intelligence and the insights and the data garnered from billions of dollars in spend and millions of transactions that are going on consistently and thousands of customers, through our AI capabilities, we're able to glean insights that could be of value to individual customers, and that value grows as they utilize the platform and as our platform becomes more ubiquitous around the world. That's our winning vision. Now that vision is supported by what we believe is a winning strategy. Three waves of our winning strategy are seen here. All of these waves are rising together, and each of these waves is building upon the other. The first of those waves is to capture all spend. We've committed ourselves to helping companies get their arms around all spend. In order to do that, you have to have a comprehensive approach to managing spend. You need to get your arms around pre-approved spend and procurement, post-approved spend in terms of invoices coming into the organization, ongoing expenditures through payments, and post-approved expenditures as seen on expense reports. That area was the first wave that we began with. One we're continuing to pursue feverishly. You can see clearly the growth in our spend under management levels as a non-financial measure to help you understand how we're continuing to execute on that wave. The second wave is to optimize with what we call SuiteSynergy. That means building and/or buying power user applications that can help companies unlock more value out of those trillions of dollars in spend flow. That's everything from designing and planning supply chains, to conducting sourcing events, to managing the contracts that companies have typically on paper in some siloed system somewhere. That means overseeing the spend as it pertains to the contingent workforce, managing treasury, managing the supplier risk so that you don't actually spend with suppliers that might be going out of business or having other challenges in their ability to deliver for you. Managing your inventory so that you're ordering at the right times, and that you're optimizing that entire process. All of these power applications that we've built or bought are either already fully integrated or are on their way to being fully integrated to our core transactional platform, thereby unlocking incredible SuiteSynergy that's never existed before in our market, where all of these point solutions weren't able to work together in a way that customers really, really want. The third wave that's cresting and moving up in tandem with the others is to amplify the value of the data and the collective community that we've been building to unlock community value. That community value is unlocked through prescriptive insights, as I shared on our former vision slide. That community value is unlocked with the interactions that we're seeing on our platform across our entire community of customers who are sharing information, insights, documents, expertise, best practices, benchmarks, and much, much more. This is what we believe is a winning strategy toward addressing this market. It takes more than vision, well, it takes more than a big market vision and strategy to execute. You also have to have a situation where your organization is set up with a culture that's ready to win. Now, our culture, I believe, is unique from many other companies that I see out there, and certainly different than any of the ones I've worked for in my personal and professional career. Rather than a traditional top-down structure, we have the exact opposite of that. It's 180 degrees different. It's a bottom-up culture. In other words, each leader, starting with myself and everyone on my team and their teams, supports the colleagues that are on their teams. They support them to unlock their greatest personal and professional potential to help our company tree grow and realize its potential in the marketplace. This is a very, very different way of doing things. It has allowed us to maintain a situation where we are not getting people stuck in the traditional Peter Principle that plagues many corporate corporations out there. We think it's an experiment worth pursuing to many, many more thousands of people as we grow the company culture at Coupa. Now, to make that work, we believe what's critical is to have a set of values or a DNA for that tree, if you will, that's going to allow it to scale. A DNA that's part and parcel of every person and the way they think about their professional lives and working with us. That's being grounded in the DNA of our company in these three core values. Number one, ensuring customer success. We're not out there to satisfy customers. If they're satisfied, we'd be delighted, but our primary focus is to ensure that they get measurable success from working with us and leveraging our Value as a Service platform. I'm very proud of the fact that 97% of our colleagues at Coupa ascribe to this value as measured by Great Place to Work recently. Secondly, our value of focusing on results. This is not a place where we spend a lot of time in politics or group think. We get to meetings, we get together, we make decisions, and we move quickly. When we were 30 people, we wanted to have the agility of a three-person company, but the weight and push of a 300-person company, and we succeeded. When we were a 300-person company, we wanted to have the agility of a 30-person company, but we wanted to punch the weight of a 3,000-person company, and we succeeded. We're nearing 3,000 people. We again want to have the agility of a 300-person company, but we want to push at the weight of a 30,000-person company. That requires a maniacal focus on results above all else. We take that approach to our colleagues internally, as well as all the constituents we work with, whether that be our customers, whether that be our partners, whether that be our board members, whether that be anyone and everyone we work with. I'm proud to tell you that 98% of my colleagues ascribe to that value. And the third value is striving for excellence. That is very simply committing ourselves to lifelong learning. Committing ourselves to rechecking in after a certain episode, a certain push, a certain marketing campaign, a certain sales effort, a certain new product launch, a certain customer deployment, a certain financing event, whatever it may be. Come back and think about how we could have done it better, and then try to do it better next time so we continue to grow together, learn together, and build an incredible company. I'm excited to spend the next few hours with all of you to answer your questions and engage in a meaningful discussion. We're here to create one of the world's leading cloud software companies, and we couldn't be more excited about that. With that, let's begin the meeting. [Presentation] Hello, everyone. I'm Steven Horwitz, VP of Investor Relations. As Todd already discussed, we are splitting today's discussion into three sections: strategy and execution, innovation and customer success, and delivering results and positioning to win. At the beginning of each section, we will post the corresponding document to Coupa's investor site at investors.coupa.com. Once posted, everyone will have approximately 10 minutes to review the document, and then we will all return for 20 minutes of Q&A related to that section. Please feel free to start posting questions during the provided document review time. When you do visit the website, please also take the time to see our inaugural ESG report, which was released earlier today. Okay. And with that, let's go ahead and review the first section, discussing strategy and execution. We'll see you all in 10 minutes. [Break] Welcome back. Let's go ahead and get started. Joining Rob and me are Chandar Pattabhiram, our Chief Marketing Officer, Rob Glenn, Executive Vice President, Global Sales, and Roger Goulart, our Executive Vice President, Business Development and Global Alliances. All right, let's get started. We have a few questions already in, and in some cases, I'll be combining these questions. We have questions from Michael Turrin, Siti Panigrah i, and Brad Sills all around TAM. I'll read one of them. It says, you mentioned TAM almost doubling from $56 billion in 2019, it seems a pretty attractive market opportunity. How has the competitive landscape evolved in the last few years, and why have the incumbents not been able to invest aggressively to address these opportunities? Rob, you want to take a start on this one? Sure. Well, I'm glad to hear that we believe the market opportunity is as sizable on the other side of this call as on this side. Look, the total addressable market opportunity is expanding for a host of reasons. The ASP increases that we're seeing commensurate with the value that we're delivering for customers, the increased functionality that we're bringing to the marketplace, through organic modules, through acquired modules, and most importantly, through integration and the SuiteSynergy of those modules. And the TAM is expanding, of course, due to expanding markets and the market segments that we're pursuing. Let me allow actually Chandar to expand a little bit more on the topic of TAM. I think it'll be worthwhile for the group. Thank you, Rob. Good morning. Hello, everybody. I'll just double-click on what Rob said, right? At any given point in time, our TAM, we've been conservative on the TAM, and it's a reflection of the capability in market, not something too heuristic, but what's in market. If you take a step back, we looked at in 2000, when we went IPO, it was around $24 billion, and then in 2017 it was around $37 billion. And when we talked to you in 2019, it was $56 billion, and now it's excitingly $94 billion. If I look at that, you know, $38 billion delta and slice it and say what makes up this TAM, it really is a set of factors, and Rob alluded to it. So first of all, you know, we talked about, you know, the seed of comprehensive in Coupa at any given point in time is a reflection of current capability. So we have two new major drivers in the TAM today, which is Coupa Pay, based on current capability, $11 billion out of that. As well as Coupa Supply Chain Design and Planning, which is around $8 billion. Together that makes up the $19 billion of that $38 billion number, half the number. The other half is based on a set of factors that Rob talked about, too. First of all, it's a reflection of, you know, increased, you know, new markets and expansions we're doing, and also it's a reflection of the successful M&A we've done and the rapid organic innovation we've introduced to the market. And then finally, you asked the competitive piece. I know what's interesting for us and what we're proud of over the years is that we have cemented our position as the value leader in our market and the ability to ensure customer success that Rob talked about. We've earned the right to have our pricing locked into the value that we deliver, and that's reflected in our ASP increase. We take all these factors into account that makes it the $94 billion, and we're really excited to go monetize that and take both. Okay. Our next question comes from Michael Turrin. The deck references 100+ patents. There's also a press release around it today. Can you speak to the moats these patents enable and how that ties into the value delivered to customers' Community Intelligence? Sure. I really appreciate calling that out. We're excited to have pushed out that press release today, but what's behind it is even more exciting. Literally 100 innovations that our collective team here has come up with to help us push our strategy of all three ways that I described in my introductory remarks. So innovation around the way you capture, spend around all four primary comprehensive areas, innovation in the way you get more and more value out of that spend, and most exciting for us as we think about the future, innovation in the way that we leverage our community, our data, our own artificial intelligence capabilities to bring out value out of those insights and push them back to individual customers. I invite anyone and everyone to review those individual patents. There's some really interesting ones. I'm proud of the fact I've contributed to a number of them myself, and we can't wait to take each and every one of them to the marketplace. Many we have and many we will, and many more that we will create in the coming quarters and years. Thank you for that question. It's great. coupa.com/innovation. That'll be a simple URL for everybody to go to see the list of all of those. Okay. Our next question is, can you talk about the typical sales cycle from a customer's point of view? What do you typically talk about with a new logo first? How does this initial person go about getting the buy-in from the necessary other executives? Who are these other executives? How do you facilitate this process? Is it always a competitive RFP? What are your win rates? Well, that sounds like about 15 questions. I'm not sure I'm going to be able to drop them all in one answer. In fact, I'll let Rob expand on it. Before I do, let me just make one key point. What we've become really good at, and we need to continue to develop, is our ability to get vision lock with our prospective customers. More and more, we're having interactions with CEOs, CFOs, CIOs, certainly. And when they see what we're able to do for companies like themselves, when they see that, it's just a question of where do we begin the process and how do we start driving toward that value? The only challenge we face truly in those prospect interactions is if in some way we are not given the opportunity to develop that vision lock. Let me turn it over to Rob for a formal comment. Yeah. I think the way we approach from a sales cycle to customers is around delivering value. We deliver real measurable value, and we can prove that value through our Coupa community, through our referenceability, and that's what's key to us winning the market. We have that proof of value. It's not about feature function from the 2000s, the 1990s. It's about the value we can deliver. Rob touched upon it. One of the things that's happening today in our sales cycles is the digital transformation agenda of the CEO, the CFO, and the CIO. That's given us access to the C-suite to allow us to demonstrate how we can change their business and drive value to their bottom line. Okay. Next question comes from Daniel Jester. For the expand opportunity on page 10, can you discuss specific strategies you are using to harvest this opportunity? Can you help think about customer journey to 100% penetration and any notable challenges to achieving this? Let me start by addressing that a little bit more strategically. Again, I'll turn it over to Rob for more color. But I will tell you this, when we land with a customer and we get deployed, if it's any key module that starts to capture their spending in any reasonable way, the opportunity for expansion simply presents itself. That's why I actually really appreciate the word harvest that was used, because that's exactly what's happening. Our sales team is really hunters. We're evangelists. We're going out there identifying value opportunities for companies and then delivering on those value opportunities. When they start to see value, then the harvesting begins. You know, we're not out farming. It's literally harvesting. The trees themselves start to grow fruit, the fruit become ripe, our sales team is able to literally pick them up off the tree in terms of additional users, additional modules, additional capabilities. That's how we think about it, we think the opportunity is absolutely to help realize the full depth and breadth of Business Spend Management for all of our customers. Absolutely. Rob, do you want to add to that? I think, one of our primary growth drivers still is the new business acquisition. It's such a huge addressable market. That's where we're focusing. We deliver value, and then the customers come back to us to harvest with our additional power-ups. You know, from risk, from contract lifecycle management, from pay, we expand. The reason we're expanding is because success, we're delivering in measurable value. You know, it's a multi-strategy approach with different levers, but really new business acquisition with our addressable markets first, and then we deliver success, and then we can expand. Okay. Looks like we had a clarification question on, does the $94 billion TAM include Coupa Pay subscription and transaction revenues? Maybe, Chandar, can you elaborate on that? Yeah. It does. It does include both. In the next section, we talk about Coupa Pay, we can dive a bit more on the Coupa Pay capability. Yes, the answer is yes. Okay. Let's see. How do the 7 million suppliers compare to the competition? [crosstalk] Our orientation is to build an incredible company that drives measurable value for every one of our customers, helping them interact with their suppliers in ways that are meaningful. We don't really think about what other folks are doing out there. That's up to them. Okay. This question comes from Matt VanVliet. Partners are involved in 80% of implementation. What is the mix of deals sourced from partners or co-selling with strategic SI partners? Let me start here, and maybe Roger could expand on this. Obviously, Roger runs our alliances for us. I think it's important historically for the audience to understand that we built this business in tandem with a wide set of systems integrators and partners from day one. That has been very, very critical to us, and this is why, of course, the very bulk of our revenue is recurring revenue, right?. We know what we're great at. You know, Incredible cloud platform around Business Spend Management. At the same time, we have been working on certifying and ensuring that this wide ecosystem of partners knows how to communicate our value proposition, number one, and secondarily, implement those offerings in a way that can drive valuable transformation for our clients. We ultimately own the success of our clients, but we've been able to do that in partnership with our partners. Roger, do you want to add to that? Yeah. It's a great question, and thank you. Again, it's a model that we've built to help us scale and ensure value to our customers. And the partners that we align with are those who are also really driving transformations, not just doing these low-level technology-type projects and customizing code. That's not interesting to our customers. It doesn't drive, again, success. Might satisfy some folks that are just trying to get some things put together, but it doesn't drive real value for our customers. So that's where our program has built. And as we look at our model, and if nothing else, the last 18 months has proven that our model makes us very resilient, and it makes us resilient for our customers. We were able to continue to expand even during the pandemic, and we also helped our partners grow as well as they were able to continue to drive value. Getting back to the question on the value. Partners are involved in the vast majority of our deals, and a good portion of them are sourced by them. We do get referrals, et cetera, but the important part for us is really, again, having that alignment and driving joint customer success and helping build these broader transformations. And that's what the partners, especially the more global, the higher-level partners, are very interested in doing. These are the Accentures, the KPMG's, the Deloittes, even the Bains, McKinseys, and other partners who we've been working hand-in-hand. That's where we reach true value, and we also have this resilient model that helps us scale for our customers. The next question, probably going to go to Roger as well. Is the goal of the Coupa App Marketplace to build an ecosystem of developers and customers similar to the Salesforce AppExchange? What are the challenges to achieving this vision? Please, Roger. Yeah. Thank you. Yes, I was fortunate to be at Salesforce, and I joined there in 2002, so I'm very familiar with the beginnings, the program there and s till, you know, they've been a great customer. We have a lot of interactions. But our motive, and what we're trying to drive with our marketplace, is slightly different. Again, you know, priority number one comes down to value for our customers, making it much easier for them. As Coupa's grown, we've created a lot of gravitational pull in the market, and we also have many different applications. But we don't do everything. Sometimes there's specific country things. There's other opportunities. We want to build an environment where customers can come, and they can see the majority and see all these different options for them and quickly be able to tie different applications together. So when we look at it, will we monetize? Yes, we will monetize the program, but based on delivering value, not just being a listing or just being part of the ecosystem. It's where we build value. We do believe that Coupa, given our customers, given the Community.ai, the data that we have in, a lot of our partners' applications are actually more valuable working in conjunction with Coupa than they would be standalone. That's the type of ecosystem we want to build. The theme here, whether it's system integrators or technology partners, we really start with alignment of our values and vision. And those are the partners we want to work with and will continue to drive success with. Okay. The next question comes from Brian Peterson. Said you mentioned that BSM as one of the four system of records. Do you think that the market gets as large as CRM, HCM, ERP? What are some of the key things to watch as the BSM market ramps up, key inflection points? It's a great question. You know, we have a very simple commercial that we put out, I guess it was about a year ago now, about a lemonade stand that we hope is helping folks visualize and really understand why these four areas are distinct to begin with. Arguably, all four of these spaces at some point began in the core of ERP. The first to be pulled out of ERP was obviously CRM, which is the way you conduct yourself with your customer, sales, marketing, service. The second being human capital management, the way you support payroll, benefits, talent, performance review people. The one that we're obviously in the process of pursuing, which is pulling out how you manage your spending and how you manage your interactions with your suppliers. What has prevented, historically, this space from realizing itself, number one, is leadership, which we think we're bringing to this marketplace. Number two, a comprehensive approach to managing all areas of spend, which we're bringing to this marketplace. A way to have all of the SuiteSynergy components I described earlier help you orchestrate the way you manage that spend. Ultimately, what we're first to do in enterprise software, which is to break the barriers between individual customer instances and bring community value to the forefront that builds on itself and it grows on itself. And so we continue to work toward that tipping point, but the marketplace is obviously massive. Our leadership position is something we don't take lightly, and the opportunity ahead of us is very, very bright. All right. Our last question comes from Stan Zlotsky. The Amplify Wave. When you think about the types of use cases this brings, how do you see this as part of the business being monetized? We're going to touch upon some of those use cases to help folks have a better feel for what Community.ai really means. We'll do that in the next section, hopefully, depending on your questions. The monetization of that has begun at some level. You see that in the average annual contract value or the average annual subscription value that our customers are paying for the Value as a Service we're delivering for them. That has grown virtually every quarter for the last 49 quarters. We anticipate that to continue across every segment of our business, from lower mid-market, mid-market, as well as enterprise. As we unlock more and more use cases of prescriptive insight, as our community within the product continues to become more and more robust and value add, we should be able to continue to monetize in this fashion. Having said that, there may also, down the road, be distinct modules that we will be selling that are highly and distinctly driven by community value. When we do that, we'll of course share that with the group. Great. Thanks everyone. That's our last question for this section. We will now be posting the second document that discusses innovation and customer success. For this document, we are going to give you a little bit of extra time as it's a longer document. We will see everyone back here in about 15 minutes. Thanks, everyone. Thank you. Thank you. [Presentation] I jumped the gun a little bit on telling you the deck was posted. The deck is being posted right now, so please go ahead and check out our second document, and you'll have 15 minutes from now to review. Thank you. [Break] Welcome back. Let's go ahead and get started. Joining Rob and me for this session are Raja Hammoud, Executive Vice President of Product, Donna Wilczek, Senior Vice President, Product Strategy and Innovation, and Rajiv Ramachandran, Senior Vice President, Coupa Pay, and Tony Tiscornia, Chief Financial Officer. Really appreciate, we've gotten a ton of great questions so far, more than we have time to go through. Let's start out. We've gotten a few questions around our ESG report today. Just summarizing, if we could highlight some of the key focal points in the report. Rob, if you don't mind kicking us off there. Sure. I'm actually going to let Don expand on our ESG agenda. I'll tell you, I am extremely excited about my colleagues in this company and their commitment across the board to truly engage meaningfully with ESG. Not purely for purposes of reporting out, but actually making a meaningful impact to our environment, to our society, and how we govern ourselves. We think we could do that through our product. We think we could do that through our platform, and we think we could do that through our efforts in coming quarters and years. Let me let Donna expand on today's. Sure, absolutely. You hit the nail on the head, Rob. This is something that so many of our colleagues are, it's just near and dear to our hearts and also our customer community. It's been amazing through the years working with our customers to really talk about and define how can we create exponential impact for ESG. By using our platform to help our customers drive their own ESG programs for sustainability and supplier diversity impact. On sustainability, our customers are using our Supply Chain Design and Planning solutions to model their networks, their transportation delivery networks, and identifying what are the best options available to them to reduce their carbon footprint. When we're talking about these types of physical supply chains, we're taking them into a digital world with a digital twin. We're modeling hundreds of billions of scenarios, of combinations of scenarios. People used to do this stuff with spreadsheets and then try to figure it all out, and it never worked. We're really excited about how you can now take a digital twin, model your network, create better decisions, and then execute those decisions in Coupa Sourcing Optimization. Just because you've modeled it, now the hard work begins. You have to really now execute it as well. And customers like CHEP have been able to reduce their carbon footprint for units delivered by 33% carbon footprint reduction. It's massive. If every company in the world that had a supply chain, a physical supply chain, was able to do this type of reduction, our planet would be a better place to live. Supplier diversity, another area. When you think about supplier diversity, you really have to be at the place that the money is being spent, at the handshakes between the buyers and the suppliers, and that's where we are. We're the middle between our customers and their suppliers, where spend happens. Community.ai is surfacing up for our customers at those places. When people are searching for goods and services, when people are managing their commodities or looking for new sourcing suppliers, Community.ai is using all of our community data and surfacing up the best diverse suppliers for them to use right at the point of the transaction. It's a really special thing for us to be able to do with customers like the American Red Cross, that they were able to move their addressable spend, 10% of which was diverse before Coupa, now to over 13.7%. Undeniably, we're excited about what we've started here with the sustainable spend. If you look at our second core value of striving for excellence, we know this is just the tip of the iceberg, and our customers and our communities are going to continue to build something special with each release. Great. Thanks, Donna. Our next question is around Coupa Pay. When can you expect Coupa Pay to be a meaningful part of the business? Rob, you want to start off? Happy to start us off. We framed the opportunity in sort of three phases, and we've been in this incubation phase for some time. Entering the second phase currently, which we're calling Accelerate. We've gotten to a place where we have a meaningful amount of customers that are using components of Coupa Pay. We know that we've been able to deliver a meaningful value for them that's measurable. They've given us feedback enough to say that they're interested in scaling with us more broadly. We've seen that opportunity at mid-market and upper mid-market and touch points and Enterprise. And now, through the Accelerate phase, we think we can really take this opportunity to another level. Okay. Here it's asking, it says, can you highlight the competitive balance within the Pay opportunity and discuss the different products and who your competitors are with each product? Well, sure. I'll happy to break down the product components for you. In fact, I'm probably going to ask my colleague, Rajiv, to do that. Rajiv and I actually began this shift together a couple of years ago and helping us spearhead it ever since. Let me turn it over to Rajiv for this one, actually. Thanks, Rob. And like you said, Rob, the vision for both our product and our go-to-market with Coupa Pay, we've really carefully and meticulously defined this, and we are executing on it with precision. You know, our customers, we are a business management platform. For the last mile of payments, our customers really asked us to help them have a fully automated solution for payments, make it efficient for them. That's what we deliver with digital payments, virtual card optimization, and early pay discounts. Like Rob said, 200+ customers, early adopters really seeing value. We built that due to our DNA with an open approach with our banking partners. Imagine a platform where you have the world's largest banks, Citibank, American Express, Bank of America, Wells Fargo, BNP Paribas, HSBC, all of them are issuers on the Coupa Pay platform today. If you look at it, there's been a shift in how our customers are approaching their work and looking at this and talking to the banks and asking the banks in RFPs to the banks like, are you a Coupa Pay issuer? Just imagine that that's the transformation that's happening in this market, and the banks who are our partners are glad to be a part of this story with us and be issuers on our platform. From that incubation phase, as we are getting into acceleration, we're going deeper. We're going deeper into the mid-market and corporate and expanding into enterprise. How we are doing that is by bringing direct integration to host-to-host connections, SWIFT models to the banks to execute digital payments. On one side, while we are doing that, on the other side, we are looking at things like digital wallets and PayPal and Venmo-based payments in today's modern world in a supply chain that includes Instagram influencers as well, that for a customer to manage it. From there on, we are looking at straight-through processing as we are integrating with fintech platforms like Stripe and enabling transactions to go end to end and growing from early pay discounts into supply chain financing as we're building out a financial network with these banks. This journey is taking us towards a model where we have our customers now thinking about payments and working capital first with Coupa. If you look at this journey, what I've described is a very solid business and management platform with a SuiteSynergy of payments and working capital with the Community bringing the data and the insights and the prescription to these customers. What I believe is the value that we provide and the differentiation that we do when it comes to managing all your payments, ability for you to generate return on capital, ability for you to expand on your DPOs, and have visibility into your cash and liquidity and manage your financial risk, I think we are unique. There's no other platform out there that is this comprehensive and providing a full suite of capabilities with payments, working capital, and treasury in one experience. Okay. Thanks for that. We're going to read this next question, maybe double-click in this area. I'm going to have to read this question because they complimented the format. That's a great way to always get your question here. Hi, guys, love the format. My way, super efficient. On page 11, I saw the transaction fees at scale by different transaction types for Coupa Pay. Noticed cross-border got premium pricing in the mid-market, but for enterprise cross-border was within the same bands as all the other transaction types. Have you received some pricing pushback at the enterprise level on cross-border transactions? Would you thought this would be a larger percent of total payments volume? Rob, can you answer that question. Well, there's a number of components to that question, but I'm proud of the fact that we've gotten to a place where we have modeled our approach to transaction components of Pay, something we've highlighted in previous earnings calls. Well, perhaps Tony could break it down a little bit further for the group. Sure. As everyone on the call knows, this is the first time we've broken out in detail the unit economics for each of the rails for Coupa Pay. We're just exiting our incubation phase, entering our acceleration phase, where we've laid out some clear metrics and milestones in our materials about what's going to help us really expand and grow in this next phase. As far as the transaction fees, I would say, look, it's early, right, as far as high volume transactions for enterprise companies running through our platform. I think what you're seeing on the table is a mix of a bit of conservatism on our part, number one. We wanted to capture fees or present fees to you guys that we think will be at scale, that we think are reliable figures for you to consider. You know, where definitely could be room for upside there. We want to be conservative there. I think we'll have more information as we carry forward. No, I don't think we've received pushback yet. I certainly wouldn't say that. I think it's more a factor of us being conservative in our initial estimates. Okay. We've gotten this question from multiple people. I'll read one of them, clarifying the TAM around Coupa Pay. It says, does the $11 billion for Coupa Pay include or exclude BELLIN? Also, $11 billion of Pay TAM on $84 billion TAM excluding Pay suggests a TAM uplift of about 15%. Is that the right way to think about the broader Pay uplift? Yeah, I'll jump in on that one, Rob, if that's okay. The first thing I'd say is the $11 billion we called out, that Chandar called out in our TAM, which is incremental from the $56 billion we had our last Analyst Day. That's a mix of both subscriptions and transaction fees. They're pretty balanced, I would say, in their contribution, a little bit higher on the transaction fees side as part of that $11 billion. That $11 billion does not include treasury management. Treasury management is in our TAM, it's in the $94 billion overall. The $11 billion we wanted to make sure is very clearly for you folks is the true core Coupa Pay opportunity. There's some functionality with our treasury management solution with our BELLIN acquisition that certainly bolsters our Pay offering, it is excluded from that $11 billion. Okay. The next question from Terry Tillman on supply chain finance market. Can you help us understand the competitive landscape? Is that all on your own, or would you partner with banks related to the banks? Can you talk more about how existing partners? Go ahead. That's a great question, Terry. Look, our current focus is taking the three primary areas that we've developed out of incubation and into acceleration. Having said that, make no mistake that the core of supply chain finance, supplier payment facilitation, perhaps, and money movement are on the roadmap. Here as well, Rajiv, if you'd like to add anything, please. Yeah, definitely. I'd like to add that. What I would say is to answer that simple question. Look, we are here building out an ecosystem with our banking partners. In fact, the real value that we are bringing to our enterprise customers is bringing the financial products of the bank through a modern cloud-based platform that we operate. That includes virtual card-based optimization, includes working capital, which could include supply chain financing and, you know, the whole area around digital payments and facilitating payments to the bank. And like Rob said, we have finished the development, and we finished the product. We're working on the supply chain side with the bank partners now in our development side. If you look at it, if you step back and look at it, really what you're seeing here is the coming together of this ecosystem of bank partners, just like we have our premium partnerships with Deloitte, with KPMG, with Accenture. If you draw a parallel here, you're going to see a unique club of banks that we're going to be working with that will bring these financial products to our customers. The value that these customers are going to get is we are pre-integrated with the banks looking at trade finance. We are pre-integrated with the bank looking at payment execution. We're pre-integrated with the bank looking at virtual card optimization. A customer doesn't have to build anything. It's a fully integrated platform bringing that value that we can provide as Coupa and the bank together brings a real value for ecosystem where the banks can then start thinking about how they would like to position Coupa as a platform for their customers above and beyond this. I've truly a great question, and I feel that that's the kind of ecosystem we are bringing together, and that's the direction we're taking with Coupa. Let me add something about our TAM as well. So the initial TAM we've laid out here for Coupa Pay is $11 billion. Now, to be clear, that is based on the three current offerings we have in the marketplace right now, early payment discounts, virtual cards, and digital payments. There are other things in the near-term roadmap, such as supply chain financing, expense payments, and then there's a whole host of directions we could go down the road, and some are all these directions with regards to becoming a card issuer, becoming a money mover, you know, managing payments that are not in Coupa even because we become a reliable payment solution and infrastructure for companies. You know, those things which I say are in our dominant phase, which you see in our materials, they're not contemplated in our TAM now, and we may or may not do those things down the road, but there's plenty of opportunities. Over time, as we update you on our TAM in future Analyst Days, you should expect to see it increase as we add more functionality. Okay, looking at the questions, I'm going to do one more, which looks like a short answer Coupa Pay, and then we'll move on because we have a number of questions about Community Intelligence as well. From Bob Napoli, what are the incremental profit margins on the payments products? Yeah, I can jump in on that one. From a technical financial perspective, most of the Pay revenues, so subscription revenue is the same as our typical subscription revenue and margins. You know, it's not dilutive there. If anything, it's accretive. Then for the transaction fees, almost all of the different rails for transaction fees are net revenue because they're in the form of a gain share from a bank or a customer or a money-moving partner. They should be, over the long term, accretive to revenue. So far, our model contemplates a flat or better contribution from Coupa Pay margins. Okay. I've gotten a few questions here. One I'll summarize but add to the question from Steve Koenig. Is Coupa introducing new capabilities in Community.ai, or is this a rebranding of Community Intelligence? Others have asked on top of that, can you expand on the value of Community Intelligence? Sure. Let me kick this off. First of all, yes, Community AI is effectively a first-time branding of what is Community Intelligence underneath. I think I can't underscore enough just how powerful these capabilities are that we've already built and are on our way to building. Hopefully, you saw the video before this section to give you a little bit of a taste for that. I think it's important that our listeners here understand what we're doing. This is the first time at scale at any enterprise software company that I know of, having been in this industry now for nearly three decades, that a company was able to break the silos of individual data and individual deployments. Ta ke that data in an anonymized, secure, and scalable way, centralize it, apply artificial intelligence to it, distill insights from it, and deliver those insights back to individual customers in a whole host of use cases, many of them that have already been built and many that we'll build over the longer term. I think it's a perfect opportunity, actually, to turn it over to Raja to give you more color around everything related really to Community.ai. Sure. Thank you, Rob. When I think of what we have done for Community.ai over the last decade, is really we continued to take it from initially a thought leading, where we are taking to the market, to a place today where customers are getting massive impact day in, day out. What we have done is design this platform from the very beginning in such a way that we allowed each and every customer to participate in this larger community. By having access to all of that data, we anonymize it, sanitize it, beautifully apply AI, and then we light it up in every single application, in every single customer instance. We light it up in their sourcing experience, in their procurement experience. We give them insights that are guiding them through their day-to-day work and creating impact every single day because the data is constantly changing. Therefore, the insights that we are providing are fresh, minute by minute, from data that is happening all around the globe. When you look at it that way, this is a game changer, not just for BSM. This concept is truly a game changer for the entire enterprise cloud software. The future is definitely all about how we connect the entire community, a business community, and help derive that intelligence and apply AI on this big data that we now, as technology providers, can afford to do, and start giving these beautiful insights. When I look now at that Community.AI and what we've done with customers, this is Rob's point, that we rebranded it, one of the major reasons is because of the amount of success that we've had. You will be able in the future to just go to Community.ai, and then you will be able to start seeing all the success scores. You will see how community members are now in a place where they're truly elevating their game with community benchmarks. They are paying with confidence. With confidence because the community data is telling them about the supplier accounts that are legitimate through the usage of the community. We are at places where we're helping companies prevent fraud because we detect the suspicious spend, suspicious behavior. Even better, because of the tie between Community.ai and the transactional platform and the entire applications, we stop the transactions. We stop it before it goes out the door. Donna talked earlier about how we have been making a lot of impact with ESG. We now are helping the community member increase their diversity by connecting them with new diverse suppliers they may not have been even aware of. We're helping them grow their entire savings. In a very unique way, we're letting them pool their purchasing power with other customers and drive prices and drive terms. These are just tip of the iceberg of examples. In the document, there's a section just on some of the examples that you can look at. What is incredibly exciting for us is that all these scenarios are literally just tip of the iceberg. We are sitting right now and co-innovating, co-competing with our customers in virtually every area of BSM, as we think about how we bring the power of the collective community. You can expect to see how we are going to help the entire community negotiate better with better pricing, because we have unique pricing intelligence at their fingertips up to date. No need to go to old spreadsheets and history. It's going to be up to date, gathered everywhere. We're going to help drive sustainability with community benchmarks about how you're doing relative to the entire community, continually take them to grow their savings. These are just some of the examples. One of the most recent ones that I couldn't be incredibly excited about, that we're working through, is how do we help the world make faster decisions with better and more accurate supply chain? The whole idea about supply chain is modeling all of the data elements, and the more data, the better the AI becomes. What a beautiful opportunity that nobody has tapped into yet of having access to the 2.6 trillion of data and massively growing, to bring all of that and feed it into the AI for each and every customer and start helping them make better and better decisions. I couldn't be more excited about where we're headed. Likewise, I am simply echoing the excitement from the entire customer community in our apps, because this is definitely a way of the future. Thank you, Raja. If you guys will bear with me, I'm going to go over by a few minutes on this session just because we have so many great questions. The next one's from Peter Levine. What is Coupa's T&E strategy in a post-COVID world, and how does the Yapta, Pana acquisitions fit into the equation? Well, let me touch on this briefly, and then we'll stay on schedule. Obviously, we're anticipating travel to start increasing in coming quarters. We have a phenomenal core application, part of our first wave, organically developed around expenses. We're in the process of developing some of the booking capabilities on the front end of that expensing process. Of course, underneath that, we have the ability to monitor bookings and present better opportunities in real time through Travel Saver. So we're excited about that opportunity, and it's part of the first wave. As travel picks up, we should see an uptick in utilization in those areas and sales of that module as well. We'll see, of course, how that plays out. The last question is, how are you measuring customer success currently, and has that changed over the years? I'm happy to take that, because that's one of the primary foundational elements of this entire company. It was based on the principle that we need to deliver measurable value for every one of our customers, and it's part and parcel to everything we do. Our pre-sales process, as you heard from Rob earlier, is all about understanding the value we can deliver. If you had our chief customer officer here, Mark, he'll tell you our kickoff meetings with our customers is about taking a handoff from sales and having a kickoff meeting that aligns everyone to that value, and then executing on that value. Once the customer goes live, we have a new platform that we've been using for a number of quarters called Coupa 360, where we can see exactly what each customer is doing with our platform, where the upticks are, where the downticks are, alerts on that information, so that any time anyone in this company has a conversation with any of our customers, we have that data at our fingertips, and we can objectively assess whether or not value is being delivered and whether or not it needs to be improved over our ongoing relationship with that customer. Really happy to get that question and happy to illustrate that platform sometime for folks if they have interest. All right. Thank you very much. That concludes this Q&A. Now we can start the next video. [Presentation] All right. With that, we're now posting the third and final document discussing delivering results and positioning to win. We will have 10 minutes to review that document, so we'll see you in about 10 minutes. Thank you very much. [Break] Hello, welcome back. Sorry about the glitch there on getting the document up. Hopefully, you guys had enough time as we added a little bit on the review time so that you could get your questions in. Let's go ahead and get started. Returning to join Rob and me are Todd Ford, President of Finance and Operations, and Tony Tiscornia, Chief Financial Officer. The first question, and I've gotten this in many different forms from people here, Jackie Glynn and Ryan MacDonald, et cetera. To paraphrase, essentially, after about Five years of being public, can you discuss the resiliency in the model and discuss how 30%+ revenue growth kind of continues to be a part of that model? Well, maybe let me frame that a little bit. Obviously, to turn it over perhaps to Tony as well, but you know, at the IPO, it's amazing. I was just looking at the trivia. It is approaching five years since we were public. The time has flown, frankly, because we're having a great time building a business and doing a lot of wonderful things out there, I believe. But we set out around a core model, and a model that we continue to execute against, which is 30% + or greater top-line growth, very thoughtful management of our sales and marketing efficiency, as well as continuing to gain leverage in this incredible business. And we've been doing that now for nearly five years, and we see a continued approach that we're pursuing currently against that very model. Tony, maybe if you'd like to add anything, but please. No, I think you covered it, Rob. I think we demonstrated in our materials today that we have a massive market. We have growth vectors that are very strong, growth drivers. And we have a great team, best product in the market, so it's an execution play for us. I think as you can see in our midterm targets, we have 15%+ free cash flows as our midterm target, I think that reflects, we've demonstrated the ability to drive very meaningful free cash flows. We've gone from 8% to 11% to 14%, even 21% this last year during COVID, which was, I think, a great result. But of course, the growth opportunity here for us is very large. Penetration in the TAM is still early in all segments, mid-market and of course enterprise, which is the majority of our dollars of revenue, right? We want to leave degrees of freedom to invest in growth as we carry forward. Rob, myself, Todd, the team here, we get together every quarter to very carefully, you know, manage the levers we have in different areas of the business investment. It's definitely a balanced approach, but the first pillar is 30%+ growth, and that's not an accident. We see a huge growth opportunity here at Coupa. Okay. Double-clicking on the growth opportunity, it says, what is the growth of international versus U.S. currently, and what is the mix of business by geography, and what will it be long term? I'll let Tony break that down. I think we have a large audience. I think it's worthwhile for folks to understand how we've been pursuing our international expansion in general. We've been doing that organically for, you know, well over a decade. Meaning we get into a new market, we close a customer, convince a customer to give us a chance, frankly. And then we deliver our outsized measurable value for that customer. And then they act as a reference for customer number Two. And Then the two act as references for four and eight and 16 and 32 and beyond. That is how we've organically grown Europe. That's how we've organically grown various other areas in the world from Australia and LATAM and now well into moving into Asia. That's the backdrop of how this is happening, and that allows us, as Tony was saying earlier, the degrees of freedom to push and pull and push and pull on resources and marketing campaigns and everything else required to not overstep the opportunity, but at the same time, capitalize on the opportunity in a way that's going to be lasting and meaningful, you know, for the long term. If you'd like to add anything, Tony, please feel free. Sure. I'd say that our international mix of revenue, as you have seen, has continued to increase steadily over time as we continue to expand our geographic footprint. Most recently, it's been in kind of the 60/40 U.S. versus non-U.S. range. I would imagine, given the size of our market over time, that it probably trends somewhere closer to 50/50, but not anytime in the near future. Okay. In regards to your revenue opportunity with existing customers today, what assumptions are you making for Coupa Pay spend around transactional fees? There's another question around that, which is also, can you break down the transactional versus subscription opportunity? Tony, I think that one's for you. Sure. Yeah. Just to clarify for everyone, the pricing and monetization for Coupa Pay, I think it's a great question. The first component is the ACV or the subscription, so a fixed subscription fee. We generally price those fees based on the size of an organization, which is the size of the problem or the solution we're delivering for that organization, the value we're going to deliver for them. In the case of digital payments, we tend to price that based upon an estimate of the number of transactions a customer is going to do in a given period. That's how we size up the ACV. You know, as you folks know, the majority of transactions for a business that we service, mid-market and large enterprise, for sure, are ACH or in-country transactions. We're able to monetize a pretty, we mentioned our materials, 20%+. In recent few quarters, it's been meaningfully higher than that. A pretty large subscription fee because of the software value that we're delivering. Regardless of which type of rail the transaction is on, as we all know, most of those transactions are in-country transactions for large enterprises. That's a very strong component of our monetization. Separately from that is the transaction fees. Just to be clear, as we laid it out in our materials, the transaction fees we laid out are incremental to the subscription fees. You have a certain kind of transaction fee, gain share, take rate, what have you, and we have laid out some conservative figures that we feel, at scale, are the right numbers to consider. There'll be a certain mix. We've laid out some ranges or some color on what we think the mix will be. What I think everyone should remember is a lot of the B2B payment solutions that people comment on or mention when they want to talk about Coupa Pay with us are aimed at serving small customers, and that's a great business as well. We're delivering a solution that provides value for some of the largest companies in the world, and certainly mid-market companies up to $1 billion as well. The ecosystem that they are living in from a complexity standpoint, cost standpoint, speed, efficiency, risk standpoint, is very complex and suboptimal. Because of that, we feel we're able to charge meaningful subscription fees and then partake in our fair share of the transaction fees. Okay. From Raimo Lenschow, what are factors that are driving the long-term gross margins above 80% compared to the level you are seeing today? Yeah. Raimo, thanks for the question. I think we've always had a target in the long term of 80%+ gross margins. I think there's a couple of factors. One is, of course, that hosting fees continue to be commoditized. Not only that, because there's multiple providers in the marketplace that are competing, as we see in the news every day, pretty strongly against each other. There's also economies of scale in our business. We don't need to add a server directly for every new dollar of revenue we bring in. As we add customers to our platform, there's significant economies of scale as we continue to grow, not only in hosting services but also in support and in our cloud operations team. And then, one other area is our continued deepening of our partnerships with our large global GSIs like Accenture, Deloitte, KPMG, and others, and regional GSIs, and where they continue to do more and more, it's already a large percentage, but more and more of the implementation work when they're providing the Coupa solution to their customers, installing it for customers. And, you know, the oversight services that we perform for them are, you know, of course, richer in margin than if we're doing a lot of these implementations on our own. I think, of course, that's a strategy that Rob and Roger Goulart, you know, developed many, many years ago to be a partner-first organization from an implementation perspective. That definitely will play out in our margins over time and has been. I have a couple questions around this, so I'll paraphrase, but it's essentially, what's the thought behind doing Coupa Ventures versus taking those funds and putting them into R&D? Let me set that up a little bit, maybe, and ask Todd to expand on it. We are a platform around which there's a great deal of value that can be created. We know what we're really great at from a core competency perspective, but we know we're not going to be great at everything. So, the driver of Coupa Ventures at the very core is how can we create more value for customers in an outsized way? The driver for it was not simply to look to make money as a VC, if you will. It's rather continue to develop this ecosystem around us. So we came together with that spirit and have begun executing on it. Todd, please. Yeah. I view Coupa Ventures as another arrow in our quiver. To win BSM, right? It's only a way for us to be smart in the space and invest in our key partners, things in CoupaLink, et cetera. When you look at winning BSM, the office of the CFO, it's a natural extension of what we're doing, whether it's partnerships, whether it's investments, and historically, you've seen us do some things in M&A. From an investment perspective, it's not either/or, right? We're continuing with our model, as Tony outlined, 30% growth, tight sales efficiency, and continue to scale up the bottom line. We are investing in other areas pretty assertively what they lend towards resiliency, as you've seen in our numbers. It's not an either/or. I would say it's additive. You know, the traction we've gotten in just a short while has been amazing, the prospects or potential investee companies that we've engaged with. And I think you're going to see a lot more great things coming from Coupa Ventures. Really just another extension to win a big market. Okay. Now moving on to some M&A questions. It says, with all the acquisitions you've done and differentiated IP you've gotten from these acquisitions, where are you in integrating all of the solutions? Seems like SuiteSynergy really plays out more when there is a common look and feel and integrated workflow. Could you help us with where you are on the technology integration journey and what is left to do? T hat's a phenomenal question. I'm happy to take that. We've been very, very thoughtful about any acquisitions we made over the lifetime of this company. We've utilized the exact same lens of thinking as to who we may or may not want to acquire, starting first of all, of course, with the people, whether or not we think that they have a high likelihood of helping us evolve our culture, number one. The lens is, can we buy either power user applications that can unlock more value out of our organic core engine, or key technology components that can be snapped onto that transactional engine, to drive more and more spend through the system, more visibility, compliance, control, everything else that we're trying to help our customers with. And we have staged those acquisitions very carefully, not to overstep so that we can't control the process of bringing the people on board, but at the same time, not to go slow enough that we miss the broader opportunity of Business Spend Management that we're playing for. With each one of those acquisitions, we have focused on making sure that we manage the people integration, all the process integration required across the entire company, and then the technology integration per the question at all levels, from the data elements, from the UI, as was mentioned in the question, and the business process integration, which is the SuiteSynergy, the core of the SuiteSynergy integration. We are vastly done with the vast amount of component acquisitions we've done. The largest, of course, was most recently in the Supply Chain Design and Planning space. This was a hugely high-quality asset that we are now well underway in terms of integrating now a couple of quarters in at all three of those levels. I'm particularly excited about our upcoming release in September that's largely focused on further tightening up SuiteSynergy across the applications. It is in the synergy that is unlocked between these applications, both in the product and the people and the processes, that is delivering value for customers. We are well, well underway with all of them. The last one being, of course, the Supply Chain Design and Planning piece. Which I would say, if I had to give a number, we're probably about three-quarters of the way through in terms of integration. All right. Thanks, Terry Tillman, for that last question. This next question is from Brian Peterson. M&A has been a key part of the strategy. Is the 30%+ growth objective organic? Is that inclusive of M&A? Can, basically, elaborate on the 30% model. Well, let me first start by saying that our core business is healthy, okay? Our trajectory is very strong. In general, it's very strong. You're coming out of COVID, it's quite strong. Our late-stage pipeline is very strong. We feel really good about this business. It is for that purpose that we have the confidence and the resilience to tell you that we absolutely plan to continue to execute against this model of 30% or greater top-line growth, continued thoughtful sales and marketing efficiency, continued leverage the model. Now, look, it might not be the most sexy thing and maybe a little bit boring because we've been doing it for now, you know, well over a decade, but we think that's what the opportunity requires. That's what the market is calling on us, to be thoughtful, but at the same time, seize this huge total addressable market. Excellent. Starting to get double-click back into the operating model. What was the primary source of upside to the 2019 sales and marketing midterm target? What investments in that line are driving the increase in the midterm target? I can jump in on that one. I think that, you know, as Rob mentioned, the second pillar in our financial model is sales and marketing efficiency. I think, you know, of course, we look very carefully at our pipeline, our late-stage pipeline overall. We certainly focus on ensuring that we have enough feet on the street and individuals to meaningfully and thoughtfully address, build relationships, and close on all these opportunities. Butt the same time, I think our LTV to CAC here at Coupa, our sales efficiency. We've always been able to drive top-line growth with a fairly strong sales and marketing efficiency. I think that's, as we mentioned before, a key ingredient to our success, right. A lot of companies out there, they go out and spend wildly, and then in one year they overdo it, and then the next year, you're backtracking, and you have upside-down numbers, and your cash flow is down. We certainly would not mortgage rich opportunities or any meaningful opportunities that we see for growth. At the same time, we're not just going to spend in order to try to juice the numbers in one year. We're planning to win the game over the long term. With that said, though, I did point out that, you know, although we did 21% free cash flows last year, you know, our midterm target is at 15%+, because we do want to leave ourselves degrees of freedom to invest in go-to-market and sales and marketing opportunities so that we can drive top-line growth. We'll continue to update on the progress there, but that's really our intent, is to leave ourselves some room for investment because we see such a massive opportunity. Okay, I think we have time for about two more questions. The first one, what is the timeline of the gross margin improvement for your Coupa Supply Chain Design and Planning, the acquisition we did there? Will the accounting be much cleaner for fiscal 2023? Certainly. From an accounting perspective, you're probably referring to the revenue, in terms of deferred revenue, that we had to write off for fair valuation, like you do for any acquisition, coming back in, and then also the conversions we're doing for licenses. The majority of both of those things, we believe, will get flushed through or get accomplished, resolved this year in fiscal 2022. I think there will, of course, be a bit of trickling overhang, as we go into fiscal 2023, but by Q1 of next year, it should be largely through the model. Our last question is around free cash flow. Can you discuss the balance of growth and free cash flow? Sure. I'll start, and then Rob and Todd, if you guys would like to chime in. I think we've talked about it, you know, in this section already quite a bit. You know, of course, look, we've laid out for you folks today the size of our opportunity. It's massive. Not only that, our growth drivers within that opportunity are very clear. Our ROI for customers is very demonstrable and calculable, and we tend to get alignment. As you've all seen, we have top of the industry as far as customer advocacy. With the huge penetration opportunity we have in front of us and a best-in-class solution that is at the top right of 28 of the most recent industry analyst reports that are out there, you know, growth is our first pillar. Right? With that said, as I've covered, just to summarize, of course, sales and marketing efficiency and leverage in our model, which you could call it profitability, but in the form of free cash flows or operating margins, is an important component of what we do as well. I mean, we spend thoughtfully, and we have balance in our model, but I would say that growth is the first priority. Okay. With that, go ahead, Rob. Sorry, Steven, if no one has anything to add, I'm happy to take us home here. Yeah, go right ahead. All right, thank you. Look, I just want to thank everybody for their time and attention this morning. You know, we think we've got a really compelling vision to execute on this massive market opportunity. We think we have a highly differentiated strategy. We think we have a really special culture we're incredibly proud of and a set of values that is going to take us into the long term in building an incredible enterprise software cloud business to rival many of the others that are out there, with innovative ways of doing things never before seen in our industry. I really want to thank everyone for their time today. I want to thank you for your attention, and I really want to thank you in the analyst community for your support as we've been building up this company for nearly five years, since IPO, and certainly into the foreseeable future. So th ank you very much, everyone.