Slide 1: Security Data & Analytics Company Overview
SECURITY DATA & ANALYTICS Company Overview AUGUST 18, 2015 CONFIDENTIAL AND PROPRIETARY
Slide 2: Disclaimers
Disclaimers This presentation includes forward-looking statements. All statements contained in this presentation other than statements of historical facts, including statements regarding future results of operations and the financial position of Rapid7, Inc. (“Rapid7,” “we,” “us” or “our”) our busin
Slide 3: Delivering Security Data & Analytics
Delivering Security Data & Analytics that revolutionize the practice of cyber security Differentiated Security Analytics 35% $35m Technology Platform Now Strategic Imperative revenue CAGR quarterly billings See End Notes for additional information and definitions Confidential and Proprietary 3
Slide 4: New Explosion Of High-Impact Cyber Attacks
New Explosion Of High-Impact Cyber Attacks IT CONTROL & VISIBILITY vastly expanding attack surface ATTACKER SOPHISTICATION & REACH weaponization of cyber attacks TIME
Slide 5: Massive Shift to Risk-Based Approach to Security
Massive Shift to Risk-Based Approach to Security NEW MODEL: Risk-Based Security OLD MODEL: SECURITY Prevention-Based Security DATA & ANALYTICS “Block and Protect” Growing Spend By 2020, 60% of enterprise information security budgets will be allocated for Rapid Detection and Response Approaches up fr
Slide 6: Rapid7 Solves Key Customer Questions
Rapid7 Solves Key Customer Questions … Key Customer AM I VULNERABLE? AM I COMPROMISED? AM I OPTIMIZED? Questions: THREAT INCIDENT SECURITY EXPOSURE MANAGEMENT DETECTION & RESPONSE ADVISORY SERVICES compliance SECURITY compliance SECURITY compliance SECURITY reporting ANALYTICS reporting ANALYTICS re
Slide 7: Technology Platform & Products
Technology Platform & Products
Slide 8: Rapid7 Security Data & Analytics Technology Platform
Rapid7 Security Data & Analytics Technology Platform Threat Exposure Incident Detection Security Advisory 3rd Party Apps Management & Response Services CONTEXT & ANALYTICS User Behavior Exposure Attack Behavior Analysis Analysis Analysis DATA COLLECTION Asset User Behavioral Mobile Cloud Controls 3r
Slide 9: Rapid7's Deep Security and Attacker Expertise
Rapid7’s Deep Security and Attacker Expertise EXPERTISE team of highly-skilled Security Researchers THREAT INTELLIGENCE research & attacker modeling COMMUNITY EXPERTISE Open Source Community thousands of global users & contributors near real-time VISIBILITY INTO NEW ATTACKS
Slide 10: From Vulnerability to Threat Exposure Management
From Vulnerability to Threat Exposure Management legacy compliance focus Attack Remediation Simulation Analytics Vulnerability IT & Patch Workflow Reporting Integration Vulnerability Threat Exposure Management Management Rapid7 Threat Exposure Management: Know your weak points Prioritize what matter
Slide 11: Nexpose Example: Rapid7's Prioritized Risk Reduction
PRODUCT Nexpose EXAMPLE Rapid7’s Prioritized Risk Reduction TRADITIONAL VULNERABILITY MANAGEMENT thousands of unintelligible alerts ID Title Occurrences MS05-43 Microsoft Windows DCOM RPCSS Service Vulnerabilities 14352 MS04-61 Microsoft Windows DCOM RPC Interface Buffer Overrun Vuln 11253 MS05-72 M
Slide 12: From Compliance Monitoring to Incident Detection & Response
From Compliance Monitoring to Incident Detection & Response legacy compliance focus Data Integration Contextual Mapping Dynamic Behavioral Analysis Data Silos Log Aggregation Static Rules Traditional Security Monitoring Incident Detection & Response RAPID7 Incident Response Services TECHNOLOGY: dete
Slide 13: Rapid7's Behavioral Analytics Advantage
PRODUCT EXAMPLE Rapid7’s Behavioral Analytics Advantage UserInsight COMPLIANCE DRIVEN SOLUTIONS machine-based info and “alert overload” WARNING: POTENTIAL BREACH 12,107 Incidents Detected IP EVENT TIME 169.186.79.33 INTEL HIT (Targeted Indicator Match) 04:13:07 88.03.0.112 Possible ExFil 04:13:07 89
Slide 14: Synergy & Leverage From Partner Ecosystem
Synergy & Leverage From Partner Ecosystem Rapid7 has more50 than Platform Integrations with Partners DATA COLLABORATION PARTNERS Two-way data sharing ‘Single pane of glass’ Enhanced platform value DATA WORKFLOW PARTNERS IT security integration Streamlines correction Improves IT efficiencies DATA ING
Slide 15: Market & Customers
Market & Customers Confidential and Proprietary 15
Slide 16: Disrupting Spend and Expanding Our TAM
Disrupting Spend and Expanding Our TAM IDC IT Security SPEND AREAS Security & Vulnerability Management $4.9 Network Intrusion Detection & Prevention 2.1 Endpoint Security Suites 2.3 Security Services 3.3 TOTAL MARKET TODAY $12.6B See End Notes for additional information and definitions RAPID7 Securi
Slide 17: Rapid7's Winning Combination
Rapid7’s Winning Combination Extensive Data Security & Collection Attacker Insights Rapid7 Addresses Key Customer Pain Points With … Contextual Intuitive Analytics User Experience
Slide 18: Efficient & Engaged Go-to-Market Strategy
Efficient & Engaged Go-to-Market Strategy Threat Exposure Incident Detection Security Advisory Management & Response Services RAPID7 GLOBAL SALES REACH Inside Field Channel Sales Sales Partners Up-sells Cross-sells Anywhere LAND … EXPAND Everywhere
Slide 19: High-Quality, Rapidly Growing Customer Base
High-Quality, Rapidly Growing Customer Base 34% of the Fortune 1000 % +4,150 % International Revenue 12 58 Enterprise Revenue Security Data & Analytics Customers Largest Industry % % 13 34 Customer Count Growth Segment (Technology) See End Notes for additional information and definitions
Slide 20: Customer Evolution From Traditional VM to TEM
CUSTOMER Evolution From Traditional VM to TEM CASE STUDY One of the World’s Largest Software Companies Rapid7 Solution Saved ~40 hours of work per month with Nexpose dynamic asset groups and actionable remediation plans during proof of concept. March 2014 July 2014 Land & Expand 2-Year Value = 5.6x
Slide 21: Multiple Drivers of Growth
Multiple Drivers of Growth 1 2 5 3 4 1. Drive Analytics & Upgrade Enterprise 2. Continue to Grow Mid-market 3. Cross-sell Incident Detection & Response with Increasing Customer Economics 4. Continue International Expansion 5. Serve as the Hub for Cyber Security
Slide 22: Proven Leadership Team Driving Execution
Proven Leadership Team Driving Execution Senior Management Corey Thomas President & CEO Lee Weiner SVP, Products & Engineering Mike McKee SVP, Services & Customer Success HD Moore Chief Research Officer Steven Gatoff Chief Financial Officer Richard Moseley SVP, Global Sales Carol Meyers Chief Market
Slide 23: Financial Overview
Financial Overview Confidential and Proprietary
Slide 24: Q2 2015 Financial Highlights
Q2 2015 Financial Highlights 1 Strong Revenue Growth of 44% YoY 2 High-Visibility Recurring & Ratable Revenue model with 61% Recurring Revenue and 83% of Q2 Revenue on Balance Sheet as of April 1, 2015 3 Strong continued Deferred Revenue Growth of 45% YoY 4 Solid Renewal Rate of 115% driving Attract
Slide 25: Strong Revenue Growth
Strong Revenue Growth 35% CAGR $77m $60m $46m $31m 2011 2012 2013 2014 +44% YoY +41% YoY $26m $24m $18m $17m Q1 2014 Q1 2015 Q2 2014 Q2 2015 Confidential and Proprietary 25
Slide 26: High Proportion of Recurring Revenue
High Proportion of Recurring Revenue 81% of revenue Products Software 20% Content Subscription Managed Services Cloud-Based Subscription Appliance Maintenance & Support 15% Maintenance & Support 19% of revenue Professional Services Professional Services 61% RECURRING REVENUE See End Notes for additi
Slide 27: Strong Growth in Deferred Revenue and Visibility
Strong Growth in Deferred Revenue and Visibility +45% GROWTH (YOY) $98m $85m $89m $67m $72m $60m $61m $46m $50m $53m Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Current Deferred Long-Term Deferred 80%+ of quarterly revenue already booked entering quarter each
Slide 28: Compelling New Logo & Organic Customer Growth
Compelling New Logo & Organic Customer Growth New Sales Orders 44% 56% existing customers new customers 115% renewal rate See End Notes for additional information and definitions LAND: EXPAND: Initial Year Spend Up-sells + Cross-sells 2.4x 2011 2012 2013 2014 Initial Year Spend New Spend in Subseque
Slide 29: Strong and Diversified Revenue Profile
Strong and Diversified Revenue Profile By Industry Vertical Other Energy 4% 4% Ed Tech 5% 13% Gov’t 8% Financials 12% Comms 9% Manufact. Healthcare 12% 11% Service Retail 11% 11% See End Notes for additional information and definitions By Customer Segment 42% Mid-Market 58% Enterprise By Customer No
Slide 30: Investing for Growth & Achieving Operating Efficiencies
Investing for Growth & Achieving Operating Efficiencies Marketing Sales & (non-GAAP) 63% 64% 53% 55% 2013 2014 Q2 Q2 2014 2015 See End Notes for additional information and definitions Development Research & (non-GAAP) 35% 35% 33% 30% 2013 2014 Q2 Q2 2014 2015 Administrative General & (non-GAAP) 19%
Slide 31: Favorable Operating Cash Flow Dynamics
Favorable Operating Cash Flow Dynamics (2%) (1%) (4%) (5%) (13%) (23%) (26%) (28%) (34%) (37%) 2012 2013 2014 Q2 2014 Q2 2015 Operating Cash Flow Margin Operating Income Margin (Non-GAAP) See End Notes for additional information and definitions greater Operating Cash Flow up-front driven by customer
Slide 32: Investment Highlights
Investment Highlights Disruptive Security Data & Analytics Platform Pioneering IT Shift to Risk-Based Security Strong Recurring Revenue Growth & Visibility Attractive Customer Economics & Diverse Base Compelling And Growing Cyber Security Market Confidential and Proprietary 32
Slide 33: End Notes
End Notes $35m in quarterly billings is for Q2 2015 and derived from financial statements as Q2 2015 revenue of $26m + Q2 2015 deferred revenue balance of $98m – Q1 2015 deferred revenue balance of $89m. 35% revenue CAGR calculated on 2011-2014. Rapid7 estimates based on IDC data. All statistics are
Slide 34: Rapid7, Inc. Summer Street Boston, MA 02110
Rapid7, Inc. 100 Summer Street Boston, MA 02110 Confidential and Proprietary