NPO and Political SaaS market - quick review

1. By Patrick Gildea
9/6/17
1
DRAFT FOR DISCUSSION PURPOSES ONLY

2. § NPO Software an $8 billion global market (1)
§ >10% CAGR, reaching $12.9 Billion by 2022 (2)
9/6/17 2
Large Growing
Market
Attractive
SaaS Model
Fragmented
Landscape
Several
Growth Drivers
§ Recurring revenue model, typically high retention / low churn
§ Low cost to maintain annuity; scale delivers strong EBITDA
§ Transitioning from on-premise to cloud a key market accelerant
§ Blackbaud only scaled player, with only a handful of well funded competitors- room for
2-3 scaled leaders in space
§ Several adjacent verticals and likely add-on cross-sell/upsell opportunities
§ Market shift from on-premise to cloud; digital transformation
§ Expansion via International, enterprise, vertical reach and product cross/up sell
Notes:
1) Forbes article 6/15/2017 and company website
2) Grand View Research 12/2016 and own estimates based on census data

3. § $335 Billion annual U.S. contributions (1)
§ 25% increase in # of U.S. non-profits 2001-2011 (1)
§ Online contributions growing >10% YoY (1)
§ Global software market for NPO an estimated $8Bn
9/6/17 3
Non-profit is a large
market opportunity
Non-profit Software
growth driven by
digital transformation
Winners will be
companies that can
differentiate through a
combination of:
§ Email, social media, web multi-channel > direct
mail, phone and TV ad multi-channel engagement
§ Big data, personalization and automation
becoming critical to conversion
§ Positioning as single source of truth (salesforce) or
at the center of the ecosystem (Okta)
§ Constant innovation – doing it better/faster
§ Unique content - analytics, insights and predictive
modelling
§ Table stakes – simple product with great UI/UX and
comprehensive features
§ Brand recognition – word of mouth and reference
accounts
§ Aggressive sales / marketing
1. Source of data Blackbaud investor presentation, various research.
2. Estimate based on various research.
Payments
24%
Online
14%
Foundatio
ns
5%
Political
8%
Financial
12%
Education
11%
Corporate
Social
Responsi
bility
4%
Arts &
Culture
2%
Data &
Analytics
7% CRM
13%
2017 NPO Software Market
1. Source of data Blackbaud investor presentation 2016, various research.
2. Political on total global political campaign funds raised per year of $13.3Bn
from various websits x estimate of tech spend at 5%
3. Excludes services
4. Payments assumes inclusion of processing fees.
$8.2Bn

4. Digital Transformation Driving
Growth
§ Digital age transformation and convergence of tools to help non-profits scale their user base, increase fundraising and more
cost effectively support operational growth are driving the demand for software
9/6/17 4
Legacy non-profit
software market
Niche focus
On-premise
Siloed
Demands of today non-
profit organizations….
Suite of
products
Latest tech
and services
Integrated
with leading
tools

5. … with one large public company and many small under capitalized players; there is room for a strong #2 to emerge
9/6/17 5
Market Size(1,2)
(in Billions)
Growth(1) Competitors
Political
Payments
CRM
Financials
Online
Data & Analytics
Education
Foundations
Corporate SR
Arts & Culture
$0.67
$1.95
$1.10
$0.99
$1.10
$0.56
$0.92
$0.42
$0.34
$0.19
Medium
Medium
Medium
High
High
Medium
Low
Low
Medium
Low
1. Source of data Blackbaud investor presentation, various website research.
2. Campaign spend based 5% of estimated total global political campaign funds raised per year of $13.3Bn

6. § Blackbaud appears to have most comprehensive software and services (albeit across several separate systems) and is the largest in terms of
revenue (~$400M in SaaS) with NB/Everyaction tied for distant second
§ NB robust partner integration, full suite of vertically integrated features and position as platform are key to differentiation – but no clear secret sauce
§ Everyaction has exclusive Democratic database, once this is freed, opens up greater competition.
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Product Category
Political/General NPO Focused Companies
Web/Mobile
Community
(Membership Mgmt.)
Engagement
(CRM, Email, Social)
Fundraising
Tools
Services
Strong Weak
Index
Analysis based on review of companies' website marketing and support pages. Web/Mobie features analyzed include: custom templates,
SSL, responsive design, SEO, Analytics. Engagement features analyzed include: dashboard, email templates, segmentation, personalization,
spam score, A/B multivariate testing, email analytics, text support, soft phone, bank/dialing, history, direct mail integration, automated
workflows. Community management features analyzed include: dashbaords, filtering, tagging, segmentation, user sign up / account creation,
user profile/social graphing, duplicate mgmt, import/export, other 3rd partty user data, personalization/analytics, task mgmt, integrations,
leaderboards. Fundraising features analyzed include: dashboards, transaction tracking, task mgmt, contact history, document mgmt, payment
processing, social integration, access to networked profiles, financials, compliance and gamification. Tools features analyzed include: event
mgmt, ticketing, social integration, API access, 3rd party integrations, and other niche features. Services refers to customer support, account
management and professional services.