Fireside conversation of great four-day conference. Thank you to everyone that's here attending, the investor side, the corporate side, and all sides. I'm thrilled to wrap this room's fireside conversations with Workiva, and two key executives sitting here on stage with me. I've had the privilege of knowing Workiva for over a decade of my career. I made my first trip to Iowa well over a decade ago to visit the company, and had the opportunity to work with them on their IPO and all the goodness since. With us on stage, we have Julie Iskow, CEO, new CEO of Workiva, which I'll start with. Not yet. Jill Klindt. Incoming. Excuse me, incoming, sorry. Jill Klindt, who is CFO of the business. Julie, you've been named CEO of the business. Congratulations once again. Thank you very much. With that, I'd say, could you give the audience here a brief intro in your background, and then as well, you know, what you plan to do the same and what you plan to do differently, leading Workiva? Sure. I'll start with my background. I'm currently the Chief Operating Officer and President of Workiva. I have full responsibility for global P&L and commercial side of the business, as well as operational side and product and technology. I've been with the company now for three and a half years, so worked very closely with Marty, our current CEO. We've worked together on the strategy, on the operations, and we'll continue on executing, but I'll talk a little bit more about that later. I will say that I came up through the product and the engineering side of the business. Been an engineer, I've been in product development, been head of both product and engineering and together, a CIO, a CPO and a CTO. Came up on the product side. I've taken on broadening roles, and as I came into Workiva, it was comfortable moving into the full operational business. I have been responsible for the strategy. Marty said when I came in, "You own the strategy to the billion dollars." Our team has been working on that. We put a strategy in place for the company to execute on within probably five, six months of my arrival. We have refreshed the strategy as the market has changed. For the most part, our strategy remains intact. It is around our fit for purpose, best-of-breed solutions on our connected, ever-increasingly open, intuitive, intelligent platform. Included with that is our strengthening of our partner ecosystem, expediting our growth, finally, of course, global footprint, expanding and being excellent everywhere we play. That's the strategy. Marty and I see things very similarly around growth, around continuous innovation, a people first culture. We see eye to eye on all of those things. Those things will continue. Our strategy will be continued to be executed on. I think where you will see my focus as well is on the productivity for the company. We're past the $500 million mark on a, from a revenue perspective, so we will continue to, you know, put emphasis on productivity as we grow and scale the company. Fantastic. Just for anyone new in the room or on the webcast, talk a little bit more about this fit for purpose solution. Workiva started with a platform, very modern SaaS platform. What do customers use Workiva to do? Sure. Actually, the company started in 2008, and it was started by accountants and engineers, and they moved into the market for some transparency around financial reporting. Since that time, over the past 15 years, what we have now is a platform, and it supports companies while they do their regulatory, financial, and ESG reporting. We are now the world's leading platform for financial reporting, ESG reporting, and GRC reporting. We have broadened into this platform, and we have. We can talk more about it if you'd like. We have a number of solutions around the financial reporting portion of the business, GRC, and of course, now we've added the ESG. TAM now, with the breadth of solutions that we have, is $25 billion, so we're not lacking for TAM today. Again, only unified platform for the, this trio, what we call internally as a trifecta of financial reporting, ESG reporting, and GRC audit risk and controls. You brought up ESG. Let's go a level deeper on that one and the opportunity. This is a global opportunity. This is not just Europe. This is regulatory driven, but it's also required by constituents, shareholders, customers. They care now about the companies they purchase from. What do you see in the ESG opportunity for Workiva? Sure. I'll say that because of what I just described to you in our history, for over a decade, we've been providing investor grade reporting for our customers. When we moved into the market for ESG six quarters ago, we were able to move out with our platform, and we've been becoming ever more fit for purpose and best of breed over those six quarters. It is a large and global opportunity for us. We've been fortunate to be, you know, a first mover in the market, but it is a new market, long durable growth. It is supported by evolving regulations. We know what's happening in Europe. The CSRD passed, even though it's not immediate, it moves us in the direction of aligning the financial reporting with the ESG reporting in one integrated report. In fact, in Europe, they call it integrated reporting. That mandate will be in effect for the 2024 filing year in 2025. That's when that happens. Then on top of that, there is assurance. Needs to be third-party audit, and that comes in 2026 through 2028. What company has assured integrated reporting, audit-ready, controlled environment for your financial data and your ESG data? Workiva. That's why that unified platform with that trio trifecta is what we have, and we're enthusiastic about the opportunity. Lots to learn, however. I mean, it's new, again, to companies. They're just understanding. Some are more mature. We have a lot of customers that are mature and ready to go and understand their journey, and they've been reporting for a while now and wanting to get more rigorous and disciplined in that. Some companies are self, you know, self-regulated because they've made commitments for ESG out in the market already. Others are more what we call emerging and learning and understanding what they have to do, a little less mature and sophisticated on their journey. We've been out in the market, early days, learning a lot. The customers are learning a lot, understanding the regulations are still evolving. Just, again, a large and global opportunity for us. Almost not even a question here. To your point, I was just reading an article yesterday that I forget what news source, Wall Street Journal, but there are a number of very large companies that were gonna report on climate proactively in the regulatory filings, regardless of what the SEC actually implements. I thought of Workiva right away. Absolutely. We have companies, even prior to regulation in North America, we have companies, of course, reporting and beginning to move into that ESG journey. Stakeholders, investors wanna see it. Regulators are going to wanna see it. The stakeholders across the company, they wanna differentiate themselves. Employees wanna work for companies that are, you know, impacting the world in the right way. There's a lot of reason companies are moving in that direction without the regulation. Great. All right, Jill, I don't want to leave you out. I'm sitting up here too long, so let's bring you in. You recently reported Q4 and also provided 2023 guidance. Maybe help frame that 2023 guidance for investors, let's start on the top line. What are some of the revenue drivers that you see that helped set up the guidance that you provided? Julie just hit on them and it's absolutely true that what we're really focusing on is those four growth drivers. We have our fit-for-purpose solutions within our innovative platform with the ability to continue to expand in geographies with special emphasis on EMEA. Alongside of that, building out our partner ecosystem and continuing to build those relationships and enable our partners to succeed and us to succeed along with them. Those are the main drivers. What we expect to see is that the broad-based solution portfolio that we have can help us to be more nimble. We saw it in 2022. We were still able to meet our beginning of the year expectations, even though we had a drop off in capital markets, and that was a tough compare for us. We still were able to meet our growth goals because of the breadth of our solutions. Alongside of that, what we're gonna see, and we talked about this, is that S&S will be growing more quickly than our services. We do expect, as our partners become, more scale up their training, that we would start to move more of our services over to our partners. Our XBRL tagging, so that part of our services portfolio will continue to keep that business. It's really profitable for us, and we're a great fit to be able to provide that. It's more of the implementation and consulting services. We'll start to move over to our partners, we'll be more flat on the services line. That brings us to a higher, high teens growth rate for S&S. We guided to 16% at the midpoint for overall revenue growth, and we feel very good about our growth path to that. Fantastic. We talked earlier, but not really driven by the macro environment per se, just given the necessity of Workiva for your customers and reporting out. What did the guidance bake in on the assumption on the macro? The same? An improvement? How did that factor this year's guidance? We were very prudent with how we formed the forecast. There's always some amount of risk, but we feel very confident that we have the ability, we have the solutions, we have the platform to be able to go out and really meet our goals. The investments that we made in 2022 will help us to. We formed some additional teams around go-to-market and heeding that plan going into this year is we tend to not see as much churn as some companies. It's not something that you can stop doing regulatory reporting— Sure —control management. We're able to retain customers at a very good rate. The growth that we expect to see will be additional sales into our strong customer base, as well as expansion into different geographies, those expanding partner relationships, all of that we really feel like will help us to continue to move forward. Just to build a bit on what Jill is saying, it's critically important, so I wanna highlight it in that we benefit from the trends of most SaaS companies, right? The move to the cloud, working from anywhere, digital and financial transformation. You know, the disparate data sources of all kinds, structured and unstructured. I mean, all of that, we have that in common with cloud and SaaS companies, and we're, you know, from a macro perspective. The two trends that are specific to our company that help drive our growth are regulation, which is increasing, and it's increasing in complexity. We help with that. That's what our, you know, that's what we do. We simplify the complexities of regulatory reporting, financial and soon-to-be non-financial, and of course, GRC. Also investor scrutiny, right? Every company is thinking about how they're being scrutinized by investors and regulators, yes, and that's increasing. We're right there. C-suites are thinking about it, and boardrooms are thinking about it. That's where, as Jill highlights, we tend to be more resilient in these times. That's why we talk about ourselves as we're a platform for these times because of not just the trends in the market around cloud, like every other SaaS company, that's absolutely beneficial to us, but it's also that the regulatory environment that's evolving and investor scrutiny, very significant for us. All those best-of-breed solutions that Jill just spoke about, I spoke about, those are on the platform, and again, only unified platform to have the financial reporting, the non-financial or ESG reporting with GRC assurance. That's what we're calling, and you'll hear us go to market with this, is assured integrated reporting, where the integrated report is the financial and non-financial or ESG together. That's what's driving our move and our optimism into the, into the next year and beyond. That's great. Jill, one more for you on the guidance. Let's hit on the bottom line quickly. you know, what did you talk about for bottom line this year? One maybe, to double-click on Q1 operating expenses, they proceeded a little bit higher than expected. Mm-hmm. Can you just talk through the trending there? Sure. For Q1, we had a tough compare against Q1 of 2022 because nobody was traveling at that point. I don't know. This time last year, this conference was the first— First thing, yeah. —that actually was an in-person. The same was true for different events in company and meeting with customers. We just didn't really travel. Travel has been a piece of that. We also in Q1 of this year are holding some employee events in person that are causing a bit of a tough comparison. Our sales teams, the marketing teams, R&D teams are getting together as a whole to do planning and forward, really, really make sure that we're building relationships, that we're able to maintain our culture and build the path forward to execute on our strategy. It's really important to bring people together in person. In a hybrid environment, I know everybody's feeling the same. Those personal interactions, it's not that it's happening every day in the office. You have to build options. Yeah. Build experiences for employees to come together. That's another piece of it. The other thing that you see in Q1 is there is some seasonality. Our 401(k) match, this is only the second year that we've had that in North America, and that tends to be skewed heavier towards the first part of the year. That's a bit of an uptick just as far as a quarter, you know, if you look at Q4 versus Q1. Some other taxes, payroll taxes, and that sort of thing tends to be heavier in Q1. If you look at the full year, we've confirm, you know, we are solidly behind being profitable in the second half and on a non-GAAP basis, and then going into 2024, being non-GAAP profitable. We've also standing behind our long-term operating model and how we, how you all can expect to see us grow over the next few years through 2027. Excellent. We'll come back to long-term operating model in a few minutes. Back on the growth opportunity side, and I'm gonna jump back to Julie now. We talked about some of the product and solution set areas of growth. Let's talk about geography. In particular, I would love to hear your diagnosis of the opportunity in Europe. Really big opportunity as I see it for Workiva. What are you doing to go deliver on that? Sure. We recognize we have not capitalized on the opportunity in Europe yet. We have a ways to go, and we're pushing heavily on improvement there. We've done a number of things, but we're going after. Yes, the CSRD is there, but there's an opportunity to sell broadly our portfolio. We're going first with partners. We're a partner-first region there in Europe. We're not as well-known as we are in North America, so that's part of the opportunity. We're also doing a realignment of our sales organization. We've centralized all of the teams very recently, and they report in now to their global counterparts, leaders in North America, so we're getting aligned more there. We're also enabling the sales organization to sell not just as a solution, but more of this assured integrated reporting, which is something already known and understood well in Europe. We hired some sales leaders there. We've brought in some outside talent. We have a new head of sales there who has sold at multiple SaaS companies and has some experience in the market. We're upleveling the team. We're enabling them to sell more of a platform play, multi-solution play as opposed to a single transaction, and we're getting aligned more across the company. We see what you see, Brett, that there is tremendous opportunity. We also understand if we can't capitalize on that, we're not gonna get to the growth objectives that we have. A significant opportunity for us in Europe. Fantastic. One other lever is partners. I think you both referred to partners earlier in this conversation. The growing partner network around Workiva's business, what are these partners? Were they big GSIs? Are they more specialized consulting firms? How does the opportunity look in the U.S. and internationally for the partner network? When I mentioned the strategy earlier, I mentioned the best-of-breed solutions, the open, intuitive, intelligent, connected platform, mentioned the global opportunity, but also mentioned us building and expanding and leveraging this high-performing partner ecosystem. We have, you know, 200+ partners within our ecosystem. Combination of course, consulting, advisory, Big Four, Global Seven, regional partners, integrators, technology partners. We really focus on those Big Four for opportunity because they're everywhere we wanna be in digital and financial transformation. We go to market together with them. They bring us source deals. We want nothing more than for them to be commercially successful when they sell with us and when they implement with us. Let's take an example of ESG. We can sell some technology with ESG. A partner could come in, and they'll help the customer today understand the journey and the strategy and help them. They'll do a materiality assessment. They'll help them select the data sources they want to include. They'll help them select the framework or frameworks that they wanna map to. They'll help them understand what reporting the stakeholders need to see, the rankers, the raters. There's so much more than technology that a partner can bring, and together we are better. They help our customers get more value, and then from our platform, and then once they're in, they can also help us expand there. When we see some metrics too. We see when we sell with partners, we are able to go broader and higher in an organization. Those partners have built very trusted and solid relationships with their customers. We're able to get a higher deal size and a higher win rate when we work with partners. Again, partners everywhere we wanna be, and they really are part of our growth story and expedite, you know, our ability to grow. Sounds like a huge opportunity, and particularly with partners helping to drive companies through digital transformation— Absolutely. —and their C-suite. They have, alliances on their side committed to our company. It's, it's both ways. We, we are opportunity for them and them for us, but together we're better, for sure. Fantastic. Jill, let's go back to those long-term targets. Sure. The 2027 targets and long-term operating model. Can you just walk us through at a high level, what you've disclosed for this long-term model? Absolutely. The long-term model brings us to 22% non-GAAP profitability. We have also said that at that point, and probably somewhat before that, we'll be at $1 billion in revenue. Building towards those targets, we are focusing on our strategy, ways to become more efficient in how we go to market, more efficient in how we sell. The way that we expect to get those targets, for some of our more long-lived solutions, they are more efficient to sell. As we get ESG more mature, as we get GRC more mature, all of these things will help us to become more efficient in that sales motion. Moving towards some improvement as a percentage of revenue across the board, and bringing partners in, to Julie's comment. Like, that's another piece of that. It all helps us become more efficient because partners can drive more, more efficient deals as well. When a partner's involved, you get a bigger deal size and tends to have a higher close rate. These are all things that are helping our productivity. Sure. In light of some of these trends, particularly the partners, do you expect S&S to remain at a higher growth rate than the services— Yes. —line? Yeah. We do. As always, I had mentioned our XBRL tagging revenue. It's a really nice services stream, and it's actually recurring services, because a company doesn't pull that in-house. That piece of it we'll expect to have some modest growth. The setup and consulting and implementation types of services, we expect to be more flat over time. What really drives us higher is that S&S revenue growth. Fantastic. We're happy to give that services revenue. Absolutely. —to our partners, and we're watching that, decrease, the services revenue decrease as we hand that off to our partners, again, to make them ever more commercially successful with us and have opportunities to build the advising services around the implementation, so. Mm-hmm. That makes a lot of sense. It's intentional. Yeah. I'm gonna pause here. We have about five minutes left. Let me just poll the room. Are there any questions? We got a mic we'll run around. I think we'll run around. Yep, here it comes. Sorry. Hold on one minute. Get you the mic. I've got two, if I could. I think recently, maybe it was a call, it was said that some customers are spending more on ESG than other solutions. I was wondering if you can talk to that. Is that a comment about the entire base, or is that very much a special sort of situation? If I could also just throw in the second one. Okay. Go ahead, please. Sorry. It's early days for us. I mean, we have hundreds, you know, several hundred rather than, you know, thousands at this point. So the data is, you know, not exact. What we're seeing is where we have financial reporting in a customer, right? They're purchasing the financial reporting with, we are seeing the price for ESG higher than the price for financial reporting. We're able to. We're looking at, as I mentioned earlier, there's a mature market and there's an emerging market. Land grab today on the early market, the emerging market. It's a different sale than it is for the mature market, where you can get larger price point. Mm-hmm. Yeah. I'd also ask, regarding the sales force reorganization, can you just give us maybe a little bit more, like, when did that start? How, you know, productive should it be, and might there be any kind of you know, slowdown in the interim? I think it's specifically related to, the EMEA. Europe. That started last year with, as Julie had mentioned, globalizing the leadership there. Within the sales team, we also had. We've talked about this, the past few quarters, that we did move more towards, trying to be more efficient with those sales, bringing more of the finding potential opportunities and pipeline building to the individual reps rather than, leaving that to account, more of the BDMs, is what we call them. Bringing the account owner more to the forefront and building that pipeline and building those relationships was a big piece of it. I don't know if there's anything else that you want to add. Okay. We just brought in the sales leader in January and began moving our, shifting our go-to-market to more of the platform, the assured integrated reporting play. We're in the midst of improving that now, so looking forward to the benefits of that. Mm-hmm. Any other questions from investors in the audience? Sure, at the front please. Yeah, at the front. Thank you. First of all, congrats on your new role, Julie. Thank you so much. The question that I had is, I think as part of your recent results, you also mentioned kind of refocusing some of your sales organization towards kind of some of your high growth use cases, such as ESG. I was wondering kind of how you're thinking about that in the kind of broader product suite and sort of whether you're thinking of deprioritizing certain products, or is it more just, you know, great, greater FTEs, I guess, allocated on the ESG side? We're being very thoughtful and strategic about our hiring, and we have this, again, broad-based platform, financial reporting, ESG and GRC, and those are our capabilities and we're putting emphasis on all of those, you know, capabilities and the platform. It's a platform play that we're moving into. It isn't that we're reallocating all resources towards ESG. We're very much looking at the platform and those three capabilities playing together. Mm-hmm. That's the value proposition. Any other last questions in the room? I'm gonna wrap with one final one. Again, thank you, Julie and Jill for both being here. Julie, again, congrats. Incoming CEO, let's say five years from now or so, and I'm not asking on financial metrics, but, and Workiva's been incredibly successful. How has Workiva defied? What do you see, the business? How does it look then five years from now in that very successful scenario? I believe we will continue to be, we will be known for the company that is powering transparent reporting for, you know, its non-financial and financial across the globe, and trusted reporting for companies around the globe. Great. Well, thank you again, and thank all of you for a great conference this week. Thank you. Thank you for being here. Yeah, thanks. Thank you.