Procore Technologies, Inc. · NYSE:PCOR
Procore Technologies — Investor Day (November 2024)
81 slides from Procore Technologies's investor day presentation, Nov 21, 2024
Slide 1: Procore 2024 Investor Day
PROCORE ¥ 2024 Inggstor Day
Slide 2: Welcome / Agenda
Welcome Agenda Thursday, November 21| 9:00 - 9:05a 9:20a-9:40a 9:40a- 10:00a 10:00a - 10:25 10:25a - 10:35a 10: Sa- ‘11:08a - 11:20a 11:20a - 12:05p 00am - 12:05pm MST Opening Remarks Alexandra Geller - Head of Investor Relations Procore Overview Tooey Courtemanche - Founder, President, & Chief Exec
Slide 3: Disclaimers
Di sclaimers rward-Looking 1933, ed, 1934, as amended, about Procore Technologies, Ine. rod th 1995, expected benefits sddressable market, the achievement of “Triple TAM, targets, Procore’s tot ‘Of product or service availabilty, or new, )" *plan,* “potential,” “predict,” ‘project 1" Narget,” “wil S
Slide 4: Procore Overview
Procore Overview Tooey Courtemanche | Founder, President, & CEO PROCORE
Slide 5: Key Takeaways
Key Takeaways va Construction is Massive Significant digitization opportunity provides durable long-term growth for a projected $15T' industry Category Leader Our leading platform and industry partnership will continue to deliver strong customer ROI PROGORE “= Financial Improvement We are committed
Slide 6: Construction Is Highly Complex & Dynamic
Construction Is Highly Complex & Dynamic Residential q ‘Multi-Family Commercial Institutional Industrial Healthcare PROCORE (@ Mechanical i Contractor 1 Jf Material Supper. GD Plumbing Contractor ,— Owner — Financier General Contractor Cars _ e a ~ Q Finishing Contractor ao @) YZ Supplier Site Prep
Slide 7: Our Vision and Mission
OUR VISION Improve the lives of everyone in construction. OUR MISSION Connect everyone in construction ona global platform. PROCORE
Slide 8: Resilience, Evolution & Success
Resilience, Evolution & Success Product Market Fit, Efficient Growth & Scale @isital »* Catalyst: ‘Smartphones a Become $150M+ ‘$500M+ $1B+ Ubiquitous Revenue Revenue Revenue’ 2017 2018 Evolve to new products, stakeholders, & geographies on Job Sites PROGORE Dwr ¥12 venue cance of $1147 att midpoint
Slide 9: Construction is Massive
Construction is Massive a 2022 Global Workforce ¥ By Sector’ Agriculture.. 8% Larger $15T Global Transportation + Est. global construction spend in 20302 , hai Global Wworidores In 2022 Financials in 2022 Combined PROGORE =:
Slide 10: Construction is Massive in our Markets
Construction is Massive in our Markets tay, oe United States $2.1T+ @ rctive Go-To-Market Australia/New land 25B+ aov Active GTM Countries Active GTM Countries ACV eS pe ay through all 3 Stakeholders PROGORE 8s 22rmceemeeets ee ee semen remem! 49
Slide 11: The Unified Platform
° The Unified Platform e SOLUTIONS oR % « all : Bid Management Project Management Field Productivity Project Financials. 20/30 Takeott Safety Workforce Planning Pay Estimating Quality Prequalification Field Scheduling Design Coordination Closeout PLATFORM CAPABILITIES BM . Decimont Menogorent Design
Slide 12: The Platform of Choice for Construction
The Platform of Choice for Construction OWNERS & GENERAL SPECIALTY DEVELOPERS CONTRACTORS CONTRACTORS cia Sofcer (Pema) GI ferrovial Qe @PABERGELDIE [hy, olxlriolnio | ip MG McGrath encie woop SKANSKA | M:CARTHY | RYAN &. LIFETIME AN 6 G GREEN uses grey Dep BeCoHe RYCON Q suneau Sy ET Sysamer Bees F
Slide 13: The Leader in Construction Technology
The Leader in Construction Technology ~$900B $1.2B Annual Construction Volume Annualized itted on Procore Revenue Run Rate ~17K 2.2K+ Total Customers Spending Customers $100K+ in ARR Active Procore Projects Running Users $157M LTM Free Cash Flow 81 Customers Spending 160+ Countries with Active Proco
Slide 14: Growth Drivers
Growth Drivers Howard Fu | CFO & Treasurer PROCORE
Slide 15: CFO Objectives > FCF Per Share Growth
CFO Objectives > FCF Per Share Growth Accelerating Free Cash Flow Per Share Growth & Monetization New logo acquisition in both the U.S. and International Expand existin © Upsell via additional construction volume © Cross-sell via new products Optimize cT™™ ion cycl PROCORE Capital Allocation Operati
Slide 16: Go To Market
Go To Market GEOGRAPHY United States Canada UK &lreland Rest of Europe Australia & New Zealand Middle East PROCORE Note: CUSTOMER omer SIZE Enterprise Mid-Market SMB Enterprise Mid-Market SMB Enterprise Mid-Market SMB Enterprise Mid-Market sMB Enterprise Mid-Market SMB Enterprise Mid-Market SMB All
Slide 17: Go To Market Dimensions: U.S.
. . Go To Market Dimensions: U.S. GEOGRAPHY Enterprise | Mid-Market | J @ U.S. is 84% of Total ARR Sue @ The avg U.S. customer has 3-4 products Enterprise | UK elreland — Mid-Market | SMB Ent | enterprise Rest of { Rertcd Mid-Market | SMB Enterprise | ‘Australia & weet NewZeaana Me-Martt [ SMB { Ent
Slide 18: Go To Market Dimensions: International
Go To Market Dimensions: __ REGION United States Canada UK &ireland Rest of Europe Australia & New Zealand Middle East PROCORE ‘STAKEHOLDER CUSTOMER General Speciality SIZE Contractor hailed Contractor eneorse | ] Jf ia-Maret { ) { Enterprise Mid-Market SMB Enterprise Mid-Market Enterprise Mid-Marke
Slide 19: Go To Market Dimensions: GCs
Go To Market Dimensions: GCs __ REGION United States Canada UK &ireland Rest of Europe Australia & New Zealand Middle East PROCORE customer On SIZE enterprise | Mid-Market | sme | emerprise | ia-Market | sme Enterprise Mid-Market ome Enterprise Mia-Macket ome Enterprise Mid-Market sma Enterprise Mid
Slide 20: Go To Market Dimensions: U.S. GCs
Go To Market Dimensions: U.S. GCs ‘STAKEHOLDER CUSTOMER = Gwner General Speciality REGION SIZE Contractor Contractor enterprise | United States yig-market | sme | SMB @ U.S. GCs are 51% of Total ARR growing 16% YoY @ The avg U.S. GC customer has 3-4 products Enterprise UK ireland Mid-Market SMB Ente
Slide 21: Go To Market Dimensions: U.S. ENT GCs
Go To Market Dimensions: U.S. ENT GCs __ REGION United States Canada UK &ireland Rest of Europe Australia & New Zealand Middle East PROCORE Mid-Market | emerprise | ia-Market | sme @ U.S. Ent GCs are 31% of Total ARR growing 16% YoY Enterprise @ The avg U.S. Ent customer has 5-6 products Mid-Market
Slide 22: Go To Market Dimensions: ENR
Go To Market Dimensions: ENR 400 STAKEHOLDER CUSTOMER ong, General Specialty Rein size Contractor Contractor Entprice [ J United States yismarket | } ome ( ) @ ENR 400 is 18% of Total ARR growing 15% YoY Emerprice Canada howe { @ The avg ENR 400 customer has 5-6 products SMB Enterprise | UK ireland
Slide 23: Go To Market Dimensions: SCs
Go To Market Dimensions: __ REGION United States Canada UK &ireland Rest of Europe Australia & New Zealand Middle East PROCORE customer See enterprise | Mid-Market | Mid-Market | exerts | swe Enero $ Mit Mara swe ‘STAKEHOLDER owners General Speciality Contractor Contractor ull Inbound Only SCs @ SCs
Slide 24: Go To Market Dimensions: Owners
Go To Market Dimensions: Owners __ REGION United States Canada UK &ireland Rest of Europe Australia & New Zealand Middle East PROCORE CUSTOMER __ SIZE Mid-Market sme Enterprise Mid-Market sme Enterprise Mid-Market sme Enterprise Mid-Market sme Enterprise Mid-Market sme Enterprise Mid-Market ‘Owners
Slide 25: Growth Drivers
Growth Drivers Pursue New Geographies Expansion via Product Cross Sell Expansion via Volume Upsell Win New Customers PROCORE
Slide 26: How We Land & Expand
How We Land & Expand on average ean al take a few conta 1 cycles until we hav Illustrative Customer Example beh onl customer As customers deploy more volume and they projects on the Platfor pathos and ramp their business ‘onto Procore, the majority Volume ” When a customer nkiaty of the expansion gr
Slide 27: New Logo Opportunity
New Logo Opportunity & Estimated U.S. Logo Capture ° ‘Owners span most major ~ industries. We have seen early <12% * 100K+ Addressable Owner ....... 2% oar coneructen aoe! in the ~100K Global Owners in Fortune 1000), energy, utes, United Stat Active GTM Countries education, and heal “upontea metscio
Slide 28: Volume Upsell Opportunity
Volume Upsell Opportunity Today we only have ~45% of our customer's total ACV Commitment ~ $900B | | | | Annual Construction Volume (ACV) Bus.acv BW imerationai acv Note ACV Commitment by Stakeholder Subcontractor Owner ACV Commitment by Customer Size Mid-Market neral Contractors Enterprise PROCORE
Slide 29: Volume Upsell Opportunity
Volume Upsell Opportunity Opportunity exists to capture an incremental $1T+ of ACV from existing customers Annual Construction Volume (ACV) Commitment ~ $90 Bus.acv W international acv ‘Available Customer ACV ACV Commitment by Stakeholder Subcontractor neral Contractors Owner ACV Commitment by Custo
Slide 30: Product Cross-Sell Opportunity
Product Cross-Sell Opportunity Continued opportunity for growth in Newer products with products with historical cross-sell attach compelling opportunity 100% 75% 50% [ll Customer Attach Rate ‘Customer White Space 25% 0% Project Quality & Safely _ Project. Invoice Bidding Resource Analytics Pay Manag
Slide 31: Land & Expand Case Study
Land & Expand Case Study Enterprise Owner with ARR of $4.5M+ 34% cacrin 8 Years ‘Ito 7 Products Volume xpansion Expansion +$70K +$2.7M Added Analytics, MEDS Veta Ceerainaton, 4 eansion No Chonge Added Training Volume Prequal —___—. Center, Project Expansion EE wnniatana — uti’ FECES] with Project wv
Slide 32: Land & Expand Case Study
Land & Expand Case Study Mid-Market GC with ARR of $500K+ 52% CAGRin 7 Years ‘Ito 6 Products and ACV Doubled Volume Expansion Added Additional Volume Procore instance Expansion, eral Removed Invice volume Management No Change Bi Added Added Design Gate Training Center, Coordination, +$123K Quality &
Slide 33: Geographic Expansion Opportunity
Geographic Expansion Opportunity Sito $2.1T $1.9T $11T U.S. ACV International ACV ROW ACV PROCORE
Slide 34: Construction is Growing, but is Cyclical
Construction is Growing, butis Cyclical Favorable Challenged 20% Demand Environment Demand Environment 15% 10% Interest “ 5% Rates Begin Rising 0% Jan.21 sun.21 Dec21 Jan.22 Jun.22 Dec.'22 an.23, un.23 Dee.'23 Jan.24 Jun24 Sep.'24 = U.S. Construction Spend YoY Growth == Fed Funds Rate (EFFR) source:
Slide 35: Combined Opportunity
Combined Opportunity everal Larg Pursue New Countries Remaining w/ Geographies trillions of ACV available across all stakeholders Expansion via Avg Customer can 2x the # of Products Attached Product Cross Sell (3-4 — 6- Expansion via ~55% of Current Customer Vol U I Annual Construction Volume olume
Slide 36: Go To Market Strategy
Go To Market Strategy Ryan Butler | SVP, Corporate and GTM Strategy & Operations PROCORE
Slide 37: Previous Go-To-Market Model
Previous Go-To-Market Model Global Head Global Head Global Head Model Limitations: of Sales of Marketing of Customer + Single/global approach to all regions Matrix organization design Disproportionate US focus + + + Generalist AEs only, no Product Overlays While this model enabled us to exceed $1B+
Slide 38: New Go-To-Market Model
New Go-To-Market Model Benefits of Model: Europe GM ScS/5/suppor + Local approach determined by regional GM ‘eMarketing + GMs responsible for entire GTM motion + Dedicated GMs for each region + Generalist AEs & Product Overlays that is local and maximizes the value and breadth of the platform. PROCO
Slide 39: Bespoke Approach by Geography
Bespoke Approach by Geography AUS/NZ Europe Middle East PCOR Brand Recognition Industry Volume & Logo Fragmentation Industry Regulation & Complexity Low High High Med Primary GTM Motion Expansion New Logo New Logo Focused New Logo TET AES CUCU C Ig = =©Multi-Stakeholder ENT GCs MM/ENT GCs ENT Owners
Slide 40: Multiple Buyer Personas
Multiple Buyer Personas rim Se BR A 33 & Personas Headof Pre- Estimator Head of Virtual Controller Chief z Construction Safety ‘Guolly Design Fane Executive Solutions Coordinator Officer Officer Officer ere x * *% ee ex & Resource Management Financial Management x x %& & 2% recricat overayspeciast P
Slide 41: Delivering
Delivering Expected Procore Benefits + Deeper account relationships + Stronger platform adoption + Higher retention and expansion rates + Stronger and more durable revenue growth + Higher margins and per share performance PROCORE
Slide 42: Case Study: Swarmed Account
Case Study: “Swarmed” Account A Customer: Enterprise Specialty Contractor Before Adopted and/or Expanded: e Added Quality & Safety e Added BIM & Design Coordination e Added Bidding e Tripled Volume Commitment ARR Uplift: Total ARR: Total ACV: 1 2 5 % + $365K $300M PROGORE 2:4 ee eg oA 167 tire
Slide 43: Case Study: Swarmed Account
Case Study: “Swarmed” Account A Customer: ENR 100 General Contractor Before Adopted and/or Expanded: e Added $1B in Annual Construction Volume Committed e Added Advisory Services ARR Uplift: Total ARR: Total ACV: 105%+ $1.4M $2B PROCORE 2:4 ee eg oA sey
Slide 44: Consistently Strong Win Rates
Consistently Strong Win Rates Historical Win Rates vs Top 3 Competitors Combined FY22 - YTD'24 New Logo Opportunities "96% Meee: Pl ; Savenoaae® | \ OPE Competitive vs. Greenfield 0% ——— FY22 FY23 yTo24 Gross Retention Rate 0% 25% 50% 75% 100% “ os “~ All Other Compettors 1B competitor A © competito
Slide 45: Transition Milestones
Transition Milestones August 2024 Transition Begins New roles identified and hiring effort began. En: nebiemert and change rn General Mi Smee assumed new scope and began forming their leadership teams. Q12025 Begin Operating in New GTM Model Territories and compensation plans distributed. Newly H2 2
Slide 46: Procore Platform - Customer Journey
Procore Platform - Customer Journey Wyatt Jenkins | Chief Product Officer PROCORE
Slide 47: The Unified Platform
° The Unified Platform e SOLUTIONS oR % * alt Bienen Project Management Field Productivity Project Financials 20)30 Ta Safety Meters Pang Pay a Quality Prequalification Field Scheduling Design Coordination Closeout PLATFORM CAPABILITIES oBIM = Document Management ™ Ass + Models + Design Plugins = Do
Slide 48: Construction Technology Maturity Curve
Construction Technology M 5 Cc Transformed aturity Curve Leader Advanced Data-driven Proactive decision excellence Technology Proficient Building with Technology Proficient context Basic New Standards Evolving meet Mobile Tech Manual Building digital Reactive foundations —————_— Paper trails, h . re
Slide 49: Momentum on Network Activation
Momentum on Network Activation Example Project ~17, 000 Procore customers as of Q3 2024 Architect Financier ‘Multi-Family aay Fal B oar, A 716, 000+ pia Qint Commercial Healthcare Engineer Collaborator Compani s, SCs, Owners, Architec Engineers, Suppliers, insurers Be ‘ & @ a @ Wo Mechanical Coneret
Slide 50: Value for Every Stakeholder
Value for Every Stakeholder General C: Specialty C Delivering projects on time Enabling teams to work efficiently, optimize and on budget productivity, and maximize profitability Enabling sights aoross portfolio of investments Procore Solutions and Platform Capabilities Project Management % Project
Slide 51: Value for Every Stakeholder
Value for Every Stakeholder Specialty Contractors Owners Enabling teams to work efficiently, optimize Enabling insights across productivity, and maximize profitability a portfolio of investments Procore Solutions and Platform Capabilities Resource Management ©} Portfolio Planning [Bb Asset Managemen
Slide 52: Conceptual Estimate
Conceptual Estimate Sarah | Owner RivCloud Tee Owner develops a cost model to create a conceptual estimate with comparable projects. PROCORE + lectin 7%) Project Cost fa Similar Historic Projects Nexus Data Center ° Riverview Ds ° $1127,780,000 $995,515,000 $2:108B $1.7938 1a Center B Your Project E
Slide 53: Detailed Design
Detailed Design 3D Takeoff Through BIM The GC's VDC team creates a 3D model to utilize for takeoffs within Procore's Estimating solution. PROCORE
Slide 54: Add Bidder
Add Bidder GC Bidding — Network TD Bid package is created from estimate. The GC can use natural language filtering in the bidding network, but Copilot has already recommended qualified contractors for invite to bid. HPRAB > HR aB
Slide 55: It Only Takes One Issue to Stop the Work
It Only Takes One Issue to Stop the Work Dylan | Foreman 0 ; Earthwork SC finds a water table issue while digging for foundations. He confirms this will impact the foundations and mechanical room with AR. PROCORE
Slide 56: RFI #24: Footing Impact from Water Table
€ RFI #24: Footing Impact from Water Table Real-Time Decisions Using RFI — and Conversations Genera nfermation — ( Dylan | Foreman __ RFI processed in real time. Procore Conversations connects everyone immediately. BD Louse Marines Game-time decisions are made quickly. PROCORE
Slide 57: RFI #24: Footing impact from water
er RFI #24: Footing impact from water... @ Engineer Quickly Updates Drawings Louisa | Engineer Updates drawings via Reason for Response response to the RFI. Engineer notes a change order is needed, and we need to add a sump pump as part of the change to protect from future issues. Change Order needs
Slide 58: Copilot
Copilot GC Hub with — Copilot = When GC logs in, they see multiple items to deal with in a single, organized view. Copilot suggests a resequencing to resolve the constraint without impacting the critical path. PROCO!
Slide 59: Minor adjustments are typically managed only in Procore
Minor adjustments are typically managed only in Procore. Procore Schedule ‘Syne This change was significant enough where all systems need the same information, so the GC PM uses the optional sync to push the change back to P6. PROCORE
Slide 60: Relocating Equipment on the Site
Relocating Equipment on the Site | Superintendent £0 Concrete Concrete Superintendent logs on remotely to ensure his team is working in the correct location. Equipment and crew have relocated to the NE corner per the schedule change. Back on track, with no impact to critical path, so no project dela
Slide 61: Pipes Plumbing, Inc
€ > mm Pipes Plumbing, Inc Phoenix, AZ, Handover Begins Plumber shares completed Action Plan for sump pump with the GC, indicating the unit is ready for service. GC PM tags completed Action Plan for Handover, automatically adding the documents to the Owner's package. Analytics indicate all Handover
Slide 62: Owner Overview
‘Owner Overview Project Closing Out Your Are Tracking Today's Schedule Sarah | Owner Ri Owner sees a full history of the project so no bottlenecks in billing. Sump Pump shows up ready for service in Asset Register, indicating Handover is underway. PROCORE
Slide 63: Delivering Value to Each Stakeholder
Delivering Value to Each Stakeholder General Contractors Delivering projects on time ‘and on budget Specialty Contractors Enabling teams to work efficiently, optimize productivity, and maximize profitability Enabling insights across @ portfolio of investments (Sona + Red + Leverage historical data t
Slide 64: Break
Break PROCORE
Slide 65: Customer Fireside
Customer Fireside Tooey Courtemanche Founder, President & CEO | Procore Technologies, Inc. Joseph (JJ) Haugland President & COO | Haugland Group LLP PROCORE
Slide 66: Financial Summary
Financial Summary Howard Fu | CFO & Treasurer PROCORE
Slide 67: CFO Objectives > FCF Per Share Growth
CFO Objectives > FCF Per Share Growth Accelerating Free Cash Flow Per Share Growth & Monetization New logo acquisition in both the U.S. and International Expand existin © Upsell via additional construction volume © Cross-sell via new products Optimize cT™™ ion cycl PROCORE .....-:c: Capital Allocati
Slide 68: Capital Allocation Priorities
Capital Allocation Capital Allocation Priorities The first lever and investment priority continues to be organic 1. Payment and efficient revenue growth. + Organic & We have significant opportunity as the technology leader + Bul Efficient Growth s serving Construction. Our sufficient capital enables
Slide 69: Capital Allocation: Stock Repurchase
Capital Allocation ＋ $300M stock repurchase authorization ＋ 1 year term ＋ To be deployed opportunistically depending on market conditions ＋ Represents approx 40% of our cash, cash Stock 1 equivalents, and marketable securities balance Repurchase ＋ Represents 3% of our market capitalization as of No
Slide 70: Capital Allocation: Go-To-Market Investment Cadence
Capital Allocation Go-To-Market Investment Cadence Typical GTM Investment Cadence FY25 Pull Forward of GTM Investment The GTM operating model transition will pull forward the investment we would have made in FY26, however, we intend to offset this investment with other efficiencies, therefore, FY25
Slide 71: Operational Efficiency
Operational Efficiency Operational Efficiency Non-GAAP Operating Non-GAAP Operating Margin Profit/Loss Note: Operating profit/loss and margin are non-GAAP measures. FY24E uses the high end of our guidance range. FY25E is based on our initial FY25 guidance. Shows fiscal year non-GAAP operating profit
Slide 72: Operational Efficiency: Progression of Efficiency
Operational Efficiency Progression of Efficiency 40% FCF Margins Commitment to margin Best in class vertical margins expansion, disciplined equity management and 25% FCF Margins ultimately free cash flow per Realize further efficiencies via thoughtful onshore and offshore initiatives share improve
Slide 73: Key Takeaways
Key Takeaways Construction is Massive Category Leader Financial Improvement Significant digitization Our leading platform and We are committed to opportunity provides industry partnership will efficiency and per share durable long-term growth continue to deliver improvement 1 for a projected $15T st
Slide 74: Executive Q&A
Executive Q&A PROCORE
Slide 75: Thank You
Thank You PROCORE
Slide 76: Appendix
Appendix PROCORE
Slide 77: References and Definitions
References and Definitions ANNUAL CONSTRUCTION VOLUME ACV When we refer to ACV with respect to our customers, we define ACV as the annual construction volume that our customers have contracted to run on the Procore platform. When we refer to ACV with respect to a geographic location (such as a reg
Slide 78: References and Definitions
References and Definitions CUSTOMER COUNT We define the number of customers at the end of a particular period as the number of entities that have entered into one or more subscriptions with us that have recurring charges for which the term has not ended, or with which we are negotiating a subscripti
Slide 79: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation (otlars in thousands) Fy21 Fy22 Revenue $514,821 $720,203 GAAP gross profit $416,509 cme? ‘Stock-based compensation e 8,004 Amortization of acquited wo intangible assets 7822 oe Employer payroll tax on employee stock transactions 457 Acquisition-related expenses. 2 -
Slide 80: GAAP to Non-GAAP Reconciliation (Cont.)
GAAP to Non-GAAP Reconciliation (Cont.) (otlars in thousands) Fy21 Fy22 Fy23 GAAP research and developm: 237,200 $270,982 $300,571 Stock-based compensator (5,040), ee (68,275) ‘Amortization of acquired technology intangible assets (2674) (2757) Employer payroll tax on employee stock transactions 608
Slide 81: Free Cash Flow Bridge
Free Cash Flow Bridge (dollars in thousands) ‘Computation of free cash flow and free cash flow margin: Net cash (used in) provided by operating activities Non-GAAP free cash flow margin PROCORE Fy21 $514,821 Fy22 $720,203, .™ (as of 3°24) $849,660 $207859 ar2a $269,428 224 $284;347 a3'24 $295,885 2