We have the Roper team with us. Neil and Jason are both with us, Zack as well, in the front row, running IR. Gentlemen, thanks for joining in. you know, Neil, if you can just maybe bring us up to speed on, you know, the story, kind of at a high level, top priorities for this year. maybe for those that don't know the story as well, give us just a quick, a quick commercial on why you guys have been so successful and in, you know, how the strategy is continuing to evolve. Yeah. Thanks for having us. It's great to be out here on the West Coast. Very briefly, at Roper, we just brought a couple of slides. We're focused on cash flow growth, compounding cash flow, and we do it two ways. We operate a portfolio of 27 technology and software companies, and we grow that business organically, mid-single-digit, plus, with operating leverage in the 45% plus or minus range. You sort of see organic cash flow growth in the high single digits. We take all of the free cash flow for the businesses and put investment-grade leverage on that, and then run a very disciplined, process-led acquisition strategy that gives us year in, year out, mid-teens cash flow compounding. We're focused on the compounding of the cash flow. From a scale business, we're a $6 billion business, ±$50 billion market cap, growing our revenue double digits, a solid Rule of 40 company, 75% of our business is vertical software, 25% is verticalized technology-enabled products. As you can see from our revenue breakdown here, this is last year's revenue. $6 billion is the midpoint of our guidance range for this year. Last year was $5.4 billion. You can see of the $4 billion of vertical software, $2.9 billion of that's recurring, and of the $2.9 billion, $2.1 billion is SaaS subscription, and the balance being on-premise maintenance. That is over a long arc of time, a decade or so from now, over the next decade or so, rolling into the cloud and becoming SaaS as well. Then, the flywheel that we have is very simple. We have these market-leading businesses. While they're all in very different end markets, they're all very similar. In they're small markets, they're leaders, they compete on intimacy. What we do is deeply verticalize and specific in tune for that end market. We then have an operating environment where they're wildly decentralized. Since we compete on intimacy, we have to enable our 27 businesses to compete very nimbly with in the markets. We have 27 presidents, 27 CFOs, 27 R&D strategies, we have 27 ERPs. At the center, we have a series of coaches that help improve these businesses over a longer, long arc of time. Finally, to round out the flywheel, we take all the free cash flow in the enterprise and deploy it very centrally from the center. You're looking at Jason and myself are two of the four or five us that are the M&A team, if you will. It's in our job description as executives to deploy the capital. When you put all that together, we're at mid-teens, very consistent mid-teens cash flow compounder over a long arc of time. We've done that for the last 20 years and have a model that continue to do it for the next 20. That's a quick overview, and delighted to get into your questions. The secret sauce. Everyone barbecues, but why is yours better? You talk about barbecue, so I can give you stories about bad barbecue at home. I think there's many elements of what makes Roper special. I think the first is the fact that we allow our businesses to operate and compete locally against their competition. We provide them incentive to grow, and this is... Most companies provide incentives to meet a budget or plan. Ours is growth-based, and when you do that, you have an environment where there's complete transparency about what's going on. There's no gamesmanship. We don't give them an incentive, our companies an incentive to lie to us, and we don't have a filter where we don't believe anything they say. Our, our culture is based in this, in this vulnerability-based trust, this... Bad news travels much faster than good news, so we just get to work on problems and get the root cause. That's part of it. The other part of it is that, from a capital deployment point of view, one of the most liberating things that Jason and myself and the team get to do is we're not tied to an end market. I know that's different from a lot of companies at this conference and many of the companies that are out there, but it allows us enormous patience and discipline because we're not trying to be the greatest fill in the blank company, type of company, end market-driven company. There might be an attractive asset. It might be bidding at a price that's not that gets too high for us, we're perfectly fine to move on to the next one. There's so much discipline in our capital deployment approach because of the end market sort of indifference. We'd like solid, healthy end markets, you know, we're in media entertainment, we're in healthcare, we're in utilities, insurance, to name a few. Anything you want to add to that? Yeah, the only thing I'd add is just the, I'd say the culture at the corporate office is that we show a lot of restraint to get involved in the businesses. There's areas where we want to help them improve, but we kind of go at their pace and just try to push them to do better. The type of people we hire are just gonna have that fabric of, you know, allowing the businesses to thrive on their own, but also finding opportunities to help them grow. It's more of an art that's been built over years. Just to put that in perspective, we have 16,000 employees, 75 are at the center, right? It's a very, very thin center, intentionally and by design. Yeah. The current M&A environment seems like a lot of companies we work with wanted to go faster. They haven't, because the private sellers have been reluctant. Because they think the valuations are coming back, they didn't come back. Now it seems like they're coming back. Like, we're in this kind of weird spot and a lot of different crosswinds. How would you characterize the overall environment right now? Yeah, it's certainly for the last three or so quarters, it's been very, very slow. The type of assets that we're investing and owning are the more mature on the spectrum, right? These are well-established businesses that have wonderful cash generation. They have the benefit of the owners. The private equity owners have the benefit of just being patient. You don't have to do a raise to fund operations or do a down round if you're earlier in the life cycle. It's starting to maybe thaw a little bit in the context that there's more processes that are in flight or initiating right now. I'm not so sure... Like, in the past, every process that started, everyone finished. That's certainly not gonna be the case right now, okay? I think the sellers are gonna test to see if they can hit reserve prices, I wouldn't expect 100% completion rate. Personally, I don't think that the market gets meaningfully improved until the Fed starts rolling over and lowering rates. That's another, whatever, nine or twelve months away at best. That's sort of market overlay. What our pattern recognition very clearly says, though, is in times of market uncertainty, disruption, there will be opportunities that present themselves on a bespoke basis. It happened in 2016 for us, it happened in 2020. We did our largest-ever acquisition in August of 2020, when we were super comfortable with our cash flow capability and stability of our company, our investment-grade leverage, and we were able to buy a terrific business for five and a half billion dollars, when nobody else was in the market. Last year, it happened with our education business Frontline. There was an opportunity. We don't know exactly how it's gonna present itself, but we're confident that it will in the over the course of the future period. You have a few billion to put to work, it sounds like? We do. I mean, this year, $4 billion is what's available at the moment, based on our current leverage level, revolver, cash will generate for the balance of the year. The model, and this page here, the M&A motion is a $3 billion-$4 billion a year deployment, just year in, year out, based on our internal cash flow generation capability. We had this chat earlier at coffee, and it's the number one question we get is on AI. Everyone says: "Okay, if you're deploying today, you're having to make a pretty solid bet that these companies don't get disrupted by AI, when IBM and all these companies are laying people off because they think AI can replace." What insulates you from AI? What gives you a tailwind from AI? What? Talk through where you're on the AI journey and what makes you different in this move? Sure. It's, I believe, and I think there's been a lot of research of recent, since it's been, like, the thing to talk about for the last couple of months. It's clear to us... I mean, well, I think... Let's step back. I think everybody would agree that all AI, for it to be effective, needs context. It needs training, it needs context. I think we can probably take that as, like, a given at this stage. What provides the best context is you have to be, you have to be verticalized in what you do, right? Professional services automation, just generally applied to any market, is not particularly exciting. How do you use AI or generative AI to help the legal billing process that is unique and bespoke to the legal market? Which we can get into. We can spend 30 minutes just talking about that and how we actually take all these remarkably complicated billing rules and put them at the point of time entry, or even use AI to do time entry for the fee earner itself. Those are things that the context of that is why I think we're generally well positioned. Like every other company, I'm super excited about the productivity that we'll get, not just the, the easy ones like Copilot or whatever it may be for R&D, but the productivity. Any static algorithm you have in your business, if you can make it a dynamic algorithm, a learning algorithm, like how do you do lead scoring, lead generation, how do you route the leads to the best salesperson? How do you do all that? Once that becomes a learning loop and iterative through machine learning or generative AI or AI, it'll be a productivity explosion. We're thinking about how to deploy across all the workflows inside the company to drive productivity as well. This is my assumption, not yours, but vertically aligned software in a particular industry with a business process and workflows seems more insulated to me than horizontal software. That's our. We believe fundamentally that, the verticalized nature is what provides context, and it therefore provides the isolation. Yeah, or the protection. We, we get the question, too, when you have 27 different operating units, and they're not on a standard stack, and they're taking their own thing, is there, is there a way to enforce, "Hey, here's a standard stack. We can work with X, Y, Z hyperscaler. We can work with this application provider. We can..." Is there, is there an opportunity, or are you just saying, "Hey, like, no, this isn't part of our playbook? It is only kind of our playbook. Let me just take a minute to explain. It is super important in our culture, I would submit for any culture, that you have clear accountability for performance. We give resource allocation decision rights to our operating teams, to our presidents and their teams. We also have a complete accountability. In our case, there's 27 P&Ls and balance sheets. There's not a dollar allocated from corporate into any of those P&Ls above EBITDA, there's no place to hide. When it comes to decisions on which hyperscaler to use or which tech stack or which AI algorithm, we're not gonna mandate that, because as soon as we mandate a thing, then we've all of a sudden just pulled away the accountability and the transparency for accountability for results. Now, that said, the way we balance this is we have coaches, four group executives. They have portfolios of 6 to 8 businesses each. They're just like your clients here. There's tons of pattern recognition in our business. These are coaches, will explain and will teach and will urge, and will Socratically sort of teach methods to what we think good looks like or great looks like. Our business leaders, one of their characteristics that we hire for is they're just voracious learners and they're competitors, and so they want to learn, and they want to sort of get ahead. It's a nice way to sort of have complete and total accountability and authority at the local level, but then also teach and promulgate new ideas. I would add that we do have some centralized contracts where it's obvious, right, for cloud providers. We went to all three large cloud providers to give the companies option, so that it didn't look like we were steering their decision-making. We will do it in certain spend categories, but it's only, you know, at the sort of, you know, the businesses have to subscribe to whatever provider they're using. You spent the last few years removing cyclicality out of the portfolio, and most are non-focused on markets like healthcare, education, utilities. Can you talk to how that's playing out? Yeah. Our 40% of our 2018 revenues, we've divested. Basically, from over the course of, between 2019 to 2020, end of last year, Thanksgiving of last year, the driving force behind that was to beat the cyclicality out of our business. We grew up, you know, as an industrial company, which had pumps and valves and exposure to energy markets and global industrial GP and auto. It was a small part of our port revenue, but it was highly cyclical, and it made it hard for investors to understand, and it was somewhat hard for us to plan the business inside. Our guiding force was to divest all that. We completed that over a course of 4 or 5 transactions. We're essentially cyclical free at this moment because of what. Not only is there the end markets that our customer that we serve, our customers serve, but also our pricing model. Everything we do is the mission-critical thing for our customers, so it's gonna be the last thing that's turned off before our customer goes out of business. We generally have subscription pricing versus transactions, so there's layers to sort of protect the cyclicality. There are other benefits, by the way. We're now higher growth. We have higher recurring revenue and more asset light, we generate more cash flow as a result. Those were byproducts focused on beating the cyclicality out of the portfolio. On education, what's the long-term vision of that portfolio? Yeah, we bought a business last year called Frontline Education. I mean, their vision is to empower the front line of education, it's one of the two scale players in the space. We are scaled and the largest for outside of classroom, the other scaled competitor is principally inside the classroom. We love the dynamics of this market. You know, we have 10 of the 13,000 school districts are our customers. We have 30 products. On average, three are used per school district. It's all around teacher and HRM, I think we did something like $29 million absentee management, sort of, fill-ins over the course of the last 12 months. It's all the teacher recruiting. It's... There's an administrative part around ERP in a couple of states and fixed asset tracking, and then a few things around special education. We love the end market. We love what Frontline does. We love the opportunity to deploy more capital. There's definitely into this chassis and this platform, there's an enormous opportunity to consolidate the space. It's wildly fragmented, competitive set, principally because of the state-by-state regulations. It's been. We're early days. We're two and a half quarters into ownership in this business, but we're excited for the future, for sure. Your largest revenue business is Deltek, and it's $800 million, with 90% coming from the U.S. A lot of questions about the international lever. Yeah. Deltek, again, just to give everybody perspective on Deltek, it's 60% it's professional services ERP. All of Deltek is their clients is a project orientation, and it's professional services. 60% is we sell to U.S. federal government contractors. The balance are to other professional services type firms. Think architects, engineers, building contractors, creative agencies, consulting firms, accounting firms, things like that. Your question about international, it's I sort of would broaden it to, we run a growth strategy in all of our businesses, and we don't come in with an answer that's predetermined. We look at the core markets, the growth of the core markets, the adjacencies by which we really have, and we put meaningful emphasis where we have the right to win. We will forgo a gigantic market opportunity that might be growing like a weed if we don't have a meaningful right to win. Right to win is really the precondition for, if you will, outperformance and outsized growth. We put emphasis there. In Deltek's case, it's been less about international and more about end market adjacencies. Going from architecture and engineering into building contractors, for instance, is an adjacency we opened up a couple of years ago. you've got 27 kids, you love them all, you get one or two that you think they went from B students to A students. Like, what are the up-and-comers that you're excited about that we should keep an eye on? Well, with your permission, I'll answer a slightly different question. I'll make up my own question. I'm teasing. I'll talk to you about maybe some of the places where we're seeing the most improvement, right? There really is, in our portfolio, it's a remarkably tight range of outcomes, right? Through our M&A engine, we look for businesses that are leaders in small markets that grow mid to high single digits. If that's what we're targeting, and we do our job decently well, then that's the portfolio we end up with. There's a pretty tight range of outcome within terms of growth rate and cash flow generation within the portfolio. For the last 5 or so years, we've been working to really improve the organic growth rate. An example is our legal software business, Aderant. It's a business that five, six years ago was $100 million in revenue. Today, it's $200 million. Its gross retention five years ago was, like, 102%, 103%. Its net retention, excuse me, was 102%, 103%. Now it's 110%, 112%. It went from 30%-35% market share to 50% market share. It's just been a complete, and terrific outcome, where we just, you know, done a great job competing and winning in the marketplace. The Vertafore, you know, our largest acquisition. Even in just a couple of years, we bought a business that was mid-single-digit growth, with hopes of moving it or having it become a high single-digit growth business. We just told our shareholders at our investor day a couple of months ago, it's solidly a mid-single-digit+ organic growth business. That's just within a couple of years. We've got other businesses that were 10 years ago, were low single-digit growth businesses. Now they're low double-digit growth businesses. It's things like that that we get excited about. We're, we're working to improve the underlying asset quality and growth of the entire portfolio. Any questions from the audience? The question is, are we seeing any different behaviors from the sponsor community, private equity sponsor community, as we compete against them for acquisitions? Yeah. They're basically, private equity hasn't been around the hoop for the last nine months. It started with not having a leveraged loan market at all last, through whatever, third quarter or so of last year, where they couldn't have a financing source. Now it's less that they... It's more that if they're owning an asset, a private equity is owning an asset, they're not gonna sell it into this market without sort of more certain interest rate environment, more certain exit, multiple sort of assumptions. There just haven't been a lot of at-bats. Everything's been very bespoke, you know, relationships that people might have, or firm might have, or occasional recap here or there. There just has not been a lot of activity in the last nine months. Other questions? One of the things we talked about earlier, too, was just this ability for the software industry to get more lean and productive and even maybe higher margin with AI and R&D. Do you believe, not near term, but 5+ years out, that our industry could actually be even more efficient than we are today? I think there's tension on two or three dimensions. First, in our case, I believe where if we could just snap our fingers and get 25% more, you know, R&D capacity tomorrow, we would take almost all of that to the product roadmap, right? In terms of then, at some point, do you then start to trading some of that for margin? Possibly, but where I get excited is I think where the tools that we're thinking already in some early AI tools in the marketplace is enormous value opportunity for a customer and therefore enormous value capture for us. We're talking about a product right now in one of our construction business, construction software data businesses, where instead of selling a $3,000 or $4,000 a year subscription to a contractor, we're talking about possibly, you know, tens, if not, maybe, you know, probably high tens of thousands of dollars a price capture because we're automating a manual process they have, and they can be more lean themselves, or it's a win-win. That would be. If something like that could happen, then it is just enormous pricing potential. That would fall to the margin line as well. There's a lot of opportunity here, for sure. The other question, just around, you know, the industry structure, anything else that's changed in the last few years that's kind of surprised you, just in the underlying industry that maybe you didn't see coming that hit, or has it been pretty predictable from your perspective? Yeah, I think probably the biggest surprise in the last three years has been in the freight spot freight market. We run a business called DAT, which basically is, think of it as a dating service between brokers and truckers, carriers. Just kind of post-COVID, everything that happened in the supply chain really manifested in what was happening with spot spot prices. We had a lot of truckers come into the market, just a very vibrant market for two or three years, and it's still doing well. We talked about the last couple of quarters, some of the truckers, you know, hanging up their keys for a little while and maybe doing another job. I'd say that's been the biggest surprise. The good news about that market for us, though, is the spot market is kind of on a secular increase relative to contract pricing, or if you're a shipper, you'll have a spot, sort of, a spot place on the order guide. They're actually using that as a more liquid means of transport. We see that as a great sort of secular tailwind for that market. Most misunderstood thing about the story that everyone needs to see or hear from you that maybe we don't fully understand? I think misunderstood or maybe underappreciated by our newer software investors is the power of the compounding nature of our model. We're very much a risk-off model. We have these clear leaders in these small markets that are wildly protected, but they grow nicely, not outrageously, but very solidly within a tight band of outcome. When you take all that free cash flow and have the freedom to deploy it to the very best use for us versus, you know, a suboptimal use across, you know, each one of the businesses individually, then it gives you this year in, year out, very consistent, low risk, mid-teens cash flow compounding. It's a combination of the organic and inorganic piece. To follow up on that, what's the maximum number of businesses under your umbrella? The second is, if you're just incentivizing these companies to grow, you know, what's the reason for them to sell to you? In other words, why can these businesses, why are these businesses better off with you? Yeah. On the... In terms of operating scale, up in 2019, we had 45 businesses, now we operate 27. 45 felt very comfortable to us, and we even when we're asked that question, at that point, we felt, you know, double-ish from that point. It's essentially the operating rhythm, so we need 1 sort of coach for every 6, 8, 9 companies. We feel great for the... We plan to do 7-year planning arcs, and so in the next 7 years, there's no scalability or extensibility issue, whether on the operating side or the capital deployment side. Why do companies select us? Well, first, as a sponsor, select us because we're a very credible, reliable, do what we say we're going to do counterparty, right? We have a reputation that we work hard for that reputation. In terms of management teams, a management team who authentically is excited to build their business over a long arc of time versus transacted every 3 to 5 years, they gravitate to us and run to us because we're one of like, we're one of one, essentially. If you want to trade your business every 3 to 5 years, then you don't like us. We can spend more time on that, but if there's one thread, a simple way of saying it, that's what I would say. I think, the question around Constellation. We've certainly studied them. They've had great returns. We have a lot of respect for what Mark and his team have done. We're very different in the fact that we tend to do larger deals. They tend to do very high volume of very small deals. We focus on growing assets that we can improve. I think Mark most just recently said he's focused on more growthy type assets. Historically, that hasn't been their playbook. They've been more of, as I understand it, more of an NPV, pure financial buyer. They also tend to incent and provide their field to do capital deployment. We're very centralized, and so, yes, we are software aggregators or compounders, but the methods are quite different. We have a lot of respect for what they've done. Thank you so much. Thank you. It's great being here.