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Textura needham conference jan2014
- 1. Patrick Allin
Chairman, CEO, Co-founder
Image: Hudson Yards Redevelopment, New York, NY –
a project managed using Textura Construction Collaboration Solutions
©2013 Textura Corporation
1
- 2. Safe Harbor
This presentation includes forward-looking statements, including statements regarding Textura's future financial performance,
market growth, demand for Textura's solutions, and general business conditions. Any forward looking statements contained in
this presentation are based upon Textura's historical performance and its current expectations and projections about future
events and financial trends affecting the financial condition of its business. These forward-looking statements should not be read
as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such
performance or results will be achieved. These forward-looking statements are based on information currently available to
Textura, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those
expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but
are not limited to, trends in the global and domestic economy and the commercial construction industry; our ability to effectively
manage our growth; our ability to develop the market for our solutions; competition with our business; our dependence on a
limited number of client relationships for a significant portion of our revenues; our dependence on a single software solution for
a substantial portion of our revenues; the length of the selling cycle to secure new enterprise relationships for our CPM solution,
which requires significant investment of resources; our ability to cross-sell our solutions; the continued growth of the market for
on-demand software solutions; our ability to develop and bring to market new solutions in a timely manner; our success in
expanding our international business and entering new industries; and the availability of suitable acquisitions or partners and
our ability to achieve expected benefits from such acquisitions or partnerships, including our acquisition of PlanSwift in January
2013 and our acquisition of Latista in December 2013. Forward-looking statements speak only as of the date hereof and we
assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other
factors affecting forward-looking information, except to the extent required by applicable laws. If we update one or more
forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other
forward-looking statements. Further information on potential factors that could affect actual results is included under the
heading “Risk Factors” in our Annual Report on Form 10-K filed on November 26, 2013, and our other reports filed with the SEC.
In addition to U.S. GAAP financial information, this presentation includes certain non-GAAP financial measures. These historical
and forward-looking non-GAAP measures are in addition to, not a substitute for or superior to, measures of financial
performance prepared in accordance with GAAP. A reconciliation between GAAP and non-GAAP measures is included at the end
of this presentation and is also included in Textura’s Q4 2013 Earnings Release on the Company’s Investor Relations website at
investors.texturacorp.com.
©2013 Textura Corporation
2
- 4. Current Business Processes – Complex, Error Prone, Inefficient
Owner / Developer
Architects
Financing
Companies
Insurance
Companies
Title
Companies
Engineers
...
General
Contractors
Owner/
Developer
GC
Banks / Insurers
Prime Sub
Sub
Title Company
Material
Supplier
Sub
Sub-tier
Prime Sub
Sub
Architects
Prime Sub
Sub
Sub-tier
...
...
Sub
Material
Supplier
...
Material
Supplier
...
Suppliers
Sub-tier
Etc.
Engineers
Sub-contractors
Design
©2013 Textura Corporation
Prequalification
Bid
Contracting
4
Construction
Close-out
- 5. Textura Solutions – Addressing the Project Lifecycle
Construction Collaboration Solutions®
CPM
GradeBeam
Submittal
Exchange
PQM
Submittal
Exchange
PlanSwift
BidOrganizer
Design
©2013 Textura Corporation
Prequalification
Latista
Bid
Contracting
5
Construction
Close-out
- 6. Significant Benefits to our Clients
Cost
efficiencies
Faster
payment
Risk
management
Process
management
©2013 Textura Corporation
6
- 7. Client Case Study #1 – Strong ROI
•
•
Internal Study Findings:
Denver-based
General Contractor
Textura CPM eliminates
15 out of 20 process steps
• “Textura CPM saves 260-330 hours a month”
• “Time savings for our risk administrator and the project
managers”
• “Improves accuracy of paperwork”
• “Greatly improves subcontractor relations”
• “Creating capacity is essential to avoid having to hire
additional staff”
General Contractor ROI:
• Estimated savings: $360,000 annually
• Estimated by the general contractor to cost them
4 basis points of construction value: $74,000 annually
Estimated Total Network Revenue to Textura:
• ~$300,000 annually
• 75% of subs already CPM users
©2013 Textura Corporation
7
- 8. Client Case Study #2 – Broad Relationships, Very Sticky
•
4,055
monthly
invoice
cycles
32,044
electronic
payments
©2013 Textura Corporation
8,862
subcontracts
ERP
system
integration
$3.43
billion
disbursed
655
active
users
8
Textura is integrated with
their mission-critical
business processes
Enterprise-wide
implementation - all
projects
•
475
projects
on-system
•
•
4 years
on
CPM
General Contractor
o
$2 million annual
network revenue
Adding 10 to 15 new
projects a month – no
Textura sales activity
•
Switching back to manual
processes would be . . .
difficult – stickier than a
subscription
- 9. Sustainable Competitive Advantages Protect CPM
Patent
portfolio
• 41 patents for CPM and 50 pending
Installed
user base
• 300 GCs and Owners
• 80,000 subcontractor organizations
Complex
functionality
• Configurable by project
• 250,000 major ways
Integration to
client systems
• 300+ interfaces to client ERP
systems
Neutral 3rd party
SaaS offering
• No significant competitor exists as a SaaS
neutral collaboration platform
©2013 Textura Corporation
9
- 10. Over $28 billion of Total Addressable Market
Market
Expansion
Target
Global
Markets
>$4.8t
Current
Markets
>$1.3t
Key Strategies:
• North America market
penetration
• Global expansion to Asia
and Western Europe
©2013 Textura Corporation
Monetization
Target
Global
Opportunity
~55-60 bps
Current
Opportunity
~34 bps
Mobile
+5–10 bps
Mobile
+4 bps
Huge Total
Addressable Market
Current
Markets
and
Solutions
>$4.4b
Global
Platform
~50 bps
Current
Solutions
~30 bps
Total
Addressable
Market
>$28.0b
+$4.0b
~$24.0b
Mobile
+$0.5b
~$3.9b
Key Strategies:
• Cross-sell solutions
• Strategic acquisitions
• Solution expansion
• Solutions to platform
• Pricing
10
Result:
•
Potential for long
term very high
revenue
growth rates
- 11. Multiple Long-term Growth Opportunities
CPM
GradeBeam
Submittal
Exchange
PlanSwift
Latista
• Project
lifecycle
from design
to operation
PQM
Data
US, Canada,
Australia
Mining
GradeBeam
BidOrganizer
• 7 primary
solutions
• Few multiproduct
clients
Financing
• Integrated
solution
suite
Submittal
Exchange
PlanSwift
• Approx. 8%
penetration
Market
penetration
• Bundled
sales/
pricing
• Platform
strategy
Cross-sell
solutions
©2013 Textura Corporation
Price
New
products
Strategic
acquisitions
11
Oil and Gas
Western
Europe,
Developed
Asia
Global
expansion
Related
markets
Future
- 12. Financial Overview
Jillian Sheehan
EVP and CFO
Image: Denver International Airport South Terminal Redevelopment, Denver, CO
– a project managed using Textura Construction Collaboration Solutions
©2013 Textura Corporation
12
- 14. Consistently High Growth Rates
$35.5
$10.9
$8.5
$4.5
$5.2
$5.7 $6.3
$9.4
$21.7
$6.8
$10.5
$3.3
$6.0
Sep 11 Dec 11 Mar 12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13
110%
119%
109%
92%
51%
65%
65%
72%
Organic growth
77%
76%
74%
FY11
FY12
FY13
Year-over-year change
Year-over-year change
77%
FY10
90%
75%
106%
64%
69%
44%
Organic growth
70%
©2013 Textura Corporation
60%
45%
46%
38%
14
45%
90%
75%
- 15. Revenue Model – Broad Base of Paying Customers
CPM
Submittal
Exchange
Latista
Activity-driven
• Owners/GCs
• Subscription fees based on
project portfolio –
total number of
projects/construction value
• Subcontractors
• Project usage fee – varies by
value of contract
PlanSwift
Organization-driven
GradeBeam
PQM
•
Primarily organization annual
subscription fees
•
Fees based on:
• Construction volume,
number of
offices/subcontractors
BidOrganizer
©2013 Textura Corporation
15
• Revenue from all users
• Fees are invoiced and
collected in advance
• Highly sticky, recurring,
and visible
- 16. CPM Revenue Model – Providing Value to All Participants
Project Fee Plus
Monthly Subscription Fee
(Based on Project Size)
Usage
Fees
(15 basis
points of
Full
Contract
Value)
Owner/
General Contractor
($25 million project)
Prime
Prime
Prime
Prime
Subcontractor Subcontractor Subcontractor Subcontractor
($7 million)
($2 million)
($5 million)
($6 million)
Sub Tier
Sub Tier
Sub Tier
Sub Tier
($2 million)
Flat
$50
Fee
Sub Tier
($1.5 million)
($1 million)
($2 million)
($1 million)
Sub Tier
Sub Tier
Sub Tier
($1 million)
($.5 million)
($.5 million)
©2013 Textura Corporation
16
- 17. Implementing Clients Drive Predictable Multi-period Growth
Case Study Client #1
Case Study Client #2
In Implementation
Fully
Implemented
In Implementation
500
300
400
Fully
Implemented
250
Business growth
300
200
Business growth
150
200
100
Steady revenue ramp
100
Steady revenue ramp
50
0
0
Active projects
©2013 Textura Corporation
17
- 18. Construction Value Added
New Projects Added
Millions
Millions
Continued Success Implementing Clients
1,511
1,467
1,245
$13.6
1,048
$7.3
Dec 12
Mar 13
Jun 13
Dec 12
Sep 13
$10.6
Mar 13
Number of Organizations
10,114
8,210
5,412
Dec 12
©2013 Textura Corporation
6,997
Mar 13
Jun 13
18
$23.7
Sep 13
Jun 13
Sep 13
- 19. Long-term Operating Model Yields Highly Attractive Margins
FY2012
FY2013
3 -4 Year
Target
Revenue Mix
Activity-driven
Organization-driven
88%
12%
79%
21%
70%
30%
Non- GAAP Gross Margin
73%
78%
87% - 90%
Non-GAAP operating expenses as % of
revenue
General and Administrative
Sales and marketing
Technology and development
Total Non-GAAP operating expenses
40%
26%
49%
115%
48%
28%
40%
116%
12% - 15%
17% - 20%
15% - 17%
45% - 52%
Adjusted EBITDA
(43)%
(38)%
35% - 45%
©2013 Textura Corporation
19
- 20. Questions . . . and Thank You
Image: World Trade Center Transportation Hub, New York, NY –
a project managed using Textura Construction Collaboration Solutions
©2013 Textura Corporation
20
- 21. GAAP to Non-GAAP Reconciliation
Fiscal Year Ended September 30, 2012
Fiscal Year Ended September 30, 2013
GAAP
Pro-Forma
Adjustments
Pro-Forma
Operating
Expenses
GAAP
Pro-Forma
Adjustments
Pro-Forma
Operating
Expenses
%
%
21,681
0
21,681
100.00%
35,534
0
35,534
100.00%
Cost of services
6,152
(203)
5,949
27.44%
11,754
(3,793)
7,961
22.40%
General and administrative
11,105
(2,329)
8,776
40.48%
23,479
(6,328)
17,151
48.27%
Sales and marketing
5,995
(298)
5,697
26.28%
12,707
(2,779)
9,928
27.94%
Technology and development
11,123
(587)
10,536
48.60%
18,148
(4,004)
14,144
39.80%
Depreciation and amortization
4,080
(4,080)
0
4,525
(4,525)
0
Total operating expenses
38,455
(7,497)
30,958
142.79%
70,613
(21,429)
49,184
138.41%
(16,774)
7,497
(9,277)
-42.79%
(35,079)
21,429
(13,650)
-38.41%
(in thousands)
Revenues
Operating expenses
Loss from Operations
©2013 Textura Corporation
21