Sprout Social, Inc · NASDAQ:SPT
Sprout Social — Investor Presentation (May 2023)
30 slides from Sprout Social's investor presentation, May 2, 2023
Slide 1: 2023 Investor Presentation
2021 Investor Day 2023 Investor Presentation
Slide 2: Disclaimers: Forward-Looking Statements
Disclaimers Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify forward-looking statements b
Slide 3: Sprout Social at a glance
*All financial metrics are as of or for the quarter ended 3/31/23. Revenue growth represents year-over-year growth of Q1 2023 over Q1 2022. 30,000+ Customers in 100+ Countries 78% Gross Profit 31% Revenue Growth 99% Subscription Revenue $310M Annual Recurring Revenue 2023 Investor Presentation
Slide 4: Investment Highlights
Investments Highlights Empowering businesses to operationalize social Mission critical system of record for digital business Recurring SaaS model (99% subscription) Founder-led leadership team and exceptional culture Disruptive inbound trial model and fast time to value Highly scalable single code b
Slide 5: Our history
Our history Sprout was built on the premise that social media would change the way the world communicates and how virtually every aspect of business operates. 2011 Sprout platform introduced 2010 Founded company 2013 Hired 100th employee 2017 First business acquisition 2018 Opened Dublin office Laun
Slide 6: Social media has fundamentally transformed the way consumers connect with brands
Social media has fundamentally transformed the way consumers connect with brands Businesses must adapt or risk becoming irrelevant to nearly half of the world’s population. The ways that business attract, acquire, sell to and service customers is being completely transformed. Total Global Social Med
Slide 7: And changed the entire customer experience, across the enterprise
And changed the entire customer experience, across the enterprise This digital transformation requires virtually every part of an organization to adapt and re-tool. Social is a horizontal technology that has tangible benefits to nearly every department of a modern business; businesses must maximize
Slide 8: Requiring an entirely new system of record
Requiring an entirely new system of record Social media is massive, scattered, multi-purpose and does not conform to our existing business systems. A centralized platform is critical to creating strategic business value. Marketing Sales Support Success Product Strategy Commerce Advocacy 2023 Investo
Slide 9: Sprout is the platform solution
Marketing Sales Support Success Product Strategy Commerce Advocacy Sprout is the platform solution Sprout consolidates the complexity of social channels into a powerful, elegant and seamlessly integrated platform that can be leveraged across an organization. 2023 Investor Presentation
Slide 10: Sprout's platform is mission-critical for more than 30,000 customers globally
Sprout’s platform is mission-critical for more than 30,000 customers globally 2023 Investor Presentation
Slide 11: A powerful, fully integrated platform
A powerful, fully integrated platform Our core platform was built to facilitate social communication. We’ve expanded our capabilities to handle new use-cases as more of the customer experience has shifted to social, and as businesses mature in their standardization of social. Expanded Capabilities P
Slide 12: Providing real-time insights for brands across billions of data points
Providing real-time insights for brands across billions of data points Social data is an unprecedented source of business intelligence — allowing businesses to better understand their customers, markets, competitors and to shape their strategy based on real-time global insights from billions of cons
Slide 13: With compounding competitive advantages
With compounding competitive advantages Our approach to building powerful tools on a single code-base allows us to address the needs of a large number of brands, while using our scale to quickly compound value. The single code-base allows us to innovate quickly and deliver feature enhancements to al
Slide 14: Direct Competitors and Other Software Vendors
Direct Competitors Specialized & lack integration Platform / technology limitations Disparate systems pieced together through M&A Custom & services heavy Other Software Vendors Social is horizontal and can’t be compartmentalized Built on common, unique ID Anonymized data / GDPR Issues Partnering wit
Slide 15: Entrenched network & integration ecosystem
Entrenched network & integration ecosystem We have deep, integrated network relationships that are increasingly hard to replicate; our expanding set of technology partner integrations is growing the value of our social system of record. 2023 Investor Presentation
Slide 16: Top customer-rated platform
Top customer-rated platform Sprout was the only social media management company recognized by customers in the 2023 G2 Best Software awards as an Enterprise Software leader. And Sprout was the only SMM recognized across SMB, Mid-Market and Enterprise. Our leadership across markets & categories is a
Slide 17: In a very large and quickly growing market
2023 Investor Presentation In a very large and quickly growing market >$44B Current SAM* 2021 Estimate <1% Current Penetration* Sprout and all of our direct competitors combined today serve a small fraction of global businesses >$100B 2025 SAM Forecast* >20% Annual Growth *See Appendix for detailed
Slide 18: With an increasingly strategic customer base
With an increasingly strategic customer base Our product, go to market and success strategies are aligned around the most productive customers. We’re positioned to capture customers as they mature into our sweet spot over time. ● >6:1 overall LTV:CAC Ratio* ● Highly diverse customer base with no rev
Slide 19: Disruptive and efficient inbound GTM model
Disruptive and efficient inbound GTM model Success & Support Account Growth Customer On-boarding RetentionInbound Trials Sales Development Demand Generation Acquisition 2023 Investor Presentation
Slide 20: Durable ARR growth
Durable ARR growth Our ARR growth has consistently compounded over time driven by steady customer growth, steady customer expansion and rapidly growing initial deal sizes. 35% ARR CAGR Compound Average Growth Rate (CAGR) measured over the trailing 3 year period 1Q20 to 1Q232023 Investor Presentation
Slide 21: Accelerating multi-year ACV growth
Accelerating multi-year ACV growth We are scaling with high quality customers. This is resulting in larger initial deals, more valuable existing customers, and broader penetration of larger accounts, all compounding to deliver multi-year ACV growth. Recent Customer Highlights ACV calculated as endin
Slide 22: Broadening customer adoption
Broadening customer adoption As we accelerate growth with our largest customers, we are establishing ourselves as the social system of record, intelligence and action. Recent Customer Highlights
Slide 23: Strong economics, optimized for growth
Strong economics, optimized for growth Attractive returns on growth investments and a strong competitive position reinforce investments to support long duration growth 2020 2021 2022 1Q23 2025 Framework Organic Revenue 36% 41% 35% 31% >30% / year Organic ARR 36% 42% 32% 30% >30% / year Non-GAAP Gros
Slide 24: Our growth strategy
Our growth strategy We are early in our journey with multiple levers to sustain durable medium term growth Lead Nascent TAM Account Expansion Platform Expansion International Expansion Category Expansion 24 2023 Investor Presentation
Slide 25: Culture as a business strategy
Culture as a business strategy Great Place to Work Certified Since the beginning, we’ve focused on building the highest quality products, an industry-leading workplace, and taking amazing care of our customers. We’re building an enduring company that our team, families, customers and investors can b
Slide 26: Driven by a world-class leadership team
Driven by a world-class leadership team Heidi Jonas General Counsel Joe Del Preto CFO Jamie Gilpin CMO Ryan Barretto President Rachael Pfenning SVP, People & Operations Peter Soung Head of Growth Alan Boyce SVP, Engineering Aaron Rankin CTO Justyn Howard CEO Gil Lara CCO Team background 2023 Investo
Slide 27: Creating value for all of our stakeholders
Creating value for all of our stakeholders Social is disruptive and mission critical Attractive unit economics and durable long term growth Strategic technology partner in secularly advantaged growth market Sustainable competitive advantages Top rated culture and team Industry leading platform 2023
Slide 28: Summary and Reconciliation of Non-GAAP Financial Measures
Appendix Sprout Social, Inc. Summary and Reconciliation of Non-GAAP Financial Measures (Unaudited) (in thousands, except per share data) Reconciliation of Non-GAAP Financial Measures Three Months Ended 03/31, 2023 2022 Reconciliation of Non-GAAP operating (income) loss Loss from operations -$11,933
Slide 29: Appendix
Appendix 2023 Investor Presentation
Slide 30: Appendix: Metric definitions
Appendix Annual Recurring Revenue (“ARR”). We define ARR as the annualized revenue run rate of subscription agreements from all customers as of the last date of the specified period. We believe ARR is an indicator of the scale of our entire platform while mitigating fluctuations due to seasonality a