CSOD Investor Deck Third Quarter - FINALv5 · Note: User and client count figures exclude Growth...

35
Corporate Overview Third Quarter 2016

Transcript of CSOD Investor Deck Third Quarter - FINALv5 · Note: User and client count figures exclude Growth...

  • Corporate OverviewThird Quarter 2016

  • Safe HarborThis presentation includes forward-looking statements. In this presentation, the words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “predict,” “potential” and similar expressions, as they relate to Cornerstone OnDemand, Inc. (“Cornerstone OnDemand” or the “Company”), business and management, are intended to identify forward-looking statements. In light of the risks and uncertainties outlined below, the future events and circumstances discussed in this presentation may not occur, and actual results could differ materially from those anticipated or implied in the forward-looking statements. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends affecting its business. Forward-looking statements should not be read as guarantees 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. Forward-looking statements are based on information available at the date of this presentation and management’s good faith belief as of such date with respect to future events, 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:

    • The Company’s ability to execute its business strategies;

    • The Company’s ability to accurately forecast revenue and appropriately plan its expenses;

    • The accuracy of Company estimates regarding its total addressable market;

    • The Company’s ability to manage growth, including additional headcount and expansion into new geographies and markets;

    • The Company’s ability to attract new clients to enter into subscriptions for its solutions;

    • The Company’s ability to service those clients effectively and induce them to renew and upgrade their deployments of the Company’s solutions;

    • The timing and success of Company efforts to increase operational efficiency;

    • The success of the Company’s strategic relationships with third parties;

    • The Company’s ability to attract and retain qualified employees and key personnel;

    • Changes in the competitive environment in the Company’s industry and the markets in which the Company operates;

    • Continued and/or increased market acceptance of Company solutions and SaaS generally;

    • The Company’s ability to innovate and introduce new and improved solutions;

    • The impact of foreign exchange rates;

    • The Company’s ability to protect and defend its intellectual property, as well as costs associated with such protection and defense;

    • Future regulatory, judicial and legislative changes in the Company’s industry;

    • Other factors discussed under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s periodic reports filed with the Securities and Exchange Commission (the “SEC”).

    Forward-looking statements speak only as of the date of this presentation. You should not put undue reliance on any forward-looking statement. The Company assumes no obligation to update any forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting future performance or results, except to the extent required by applicable laws. If the Company updates one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements.

    In considering investing in the Company’s securities, you should read the documents the Company has filed with the SEC for more complete information about the Company. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov.

    2

  • Cornerstone Today

  • 1999

    Our Evolution16 Years Ago…

    4

  • 2010

    Our EvolutionThe Last Decade…

    5

  • 2016

    Our EvolutionToday

    6

  • 7Note: User and client count figures exclude Growth Edition and Cornerstone for Salesforce.

    CLIENTS

    2,700+USERS

    26M+COUNTRIES

    191LANGUAGES

    42OFFICES

    19

    San Francisco

    Santa Monica

    Sunnyvale

    Sao Paulo

    MadridParis

    LondonAmsterdam

    Stockholm

    DusseldorfMunich

    Tel Aviv

    Bangalore

    MumbaiHong Kong

    Tokyo

    Sydney

    Auckland

    Today with Global Reach…

    As of June 30, 2016

    New Delhi

  • Acquired by

    Acquired by

    Acquired by

    Acquired by

    Acquired by

    8

    …and an Organically-Grown Core Suite

  • Cornerstone is the Talent Management Leader

    9

    Niche Players Visionaries

    Challengers Leaders

    Magic Quadrant for Talent Management Suites

    Lumesse

    COMPLETENESS OF VISION

    ABI

    LITY

    TO E

    XEC

    UTE

    Source: Gartner (August 2015)

    Deltek (HRsmart)

    Technomedia

    Haufe PeopleFluentSumTotal

    Halogen Software

    Saba

    Oracle (Talent Management Cloud)

    SAP (SuccessFactors)

    Talentsoft

  • Bolstered by Tier One Global Partners

    10

    Select Alliances

  • 11

    x

    The Ability to Integrate with Everyone

  • OVER TIME, MORE PEOPLE + MORE TO SELL

    LEARNING

    PERFORMANCE

    RECRUITING

    ANALYTICS

    Now with More People with More to Sell

  • Strong Results

    13

    $11.0 $19.6

    $29.3 $46.6

    $75.5

    $117.9

    $185.1

    $263.6

    $339.7

    $0

    $50

    $100

    $150

    $200

    $250

    $300

    $350

    2007 2008 2009 2010 2011 2012 2013 2014 2015

    $15.0 $24.9

    $34.5

    $60.9

    $97.6

    $154.3

    $231.7

    $316.1

    $400.5

    $0

    $60

    $120

    $180

    $240

    $300

    $360

    $420

    2007 2008 2009 2010 2011 2012 2013 2014 2015

    (in millions) (in millions)

    Revenue Bookings

  • Growing ASPs Across All Geographies

    14

    +48%

    +15%

    +44%

    North America Europe,

    Middle East & Africa

    Asia Pacific

    Note: ASP values reflect year-over-year growth for FY2015.

  • Growth Across All Metrics

    15

    $11.0$19.6

    $29.3$46.6

    $75.5

    $117.9

    $185.1

    $263.6

    $339.7

    2007 2008 2009 2010 2011 2012 2013 2014 2015

    Revenue Growth

    105 168

    280

    481

    805

    1,237

    1,631

    2,153

    2,595

    2007 2008 2009 2010 2011 2012 2013 2014 2015

    Client Growth

    0.92.1

    3.3

    4.9

    7.5

    10.6

    14.0

    18.1

    23.8

    2007 2008 2009 2010 2011 2012 2013 2014 2015

    User Growth(in millions) (in millions)

    Note: User and client count figures exclude Growth Edition and Cornerstone for Salesforce.

  • Clear Path to Profitability

    16

    $(2.5) $(2.0)

    $3.1 $1.8

    $12.5 $14.9

    $27.0

    ($10)

    $0

    $10

    $20

    $30

    2010 2011 2012 2013 2014 2015 2016E

    (in millions)

    -21.9%

    -17.3%

    -14.9%

    -7.5% -6.9% -6.7%

    0.1%

    -25%

    -15%

    -5%

    5%

    2010 2011 2012 2013 2014 2015 2016E

    Free Cash Flow

    Non-GAAP Net Loss Margin

    Note: Historical values have been restated to reflect updated definitions of recently published SEC guidance. 2016E values reflect the latest issued guidance. 2016E non-GAAP net loss margin uses the

    midpoint of the revenue guidance range.

  • Long-Term Margin Improvement

    17

    2015 Improvement 2018E

    Gross Margin 72% 2-3% 74-75%

    S&M (% of Rev.) 54% 10-14% 40-44%

    R&D (% of Rev.) 10% - 10%

    G&A (% of Rev.) 12% 2% 10%

    Operating Margin -4% 14%+ 10%+

    Free Cash Flow Margin 4% 12%+ 16%+

    Note: All values are non-GAAP metrics.

  • Our OpportunityMarching to $1 Billion

  • Work is Changing

    19

    WHO

    WHAT

    WHERE

    WHEN

    HOW

  • The Market Need is Real

    20

    Thuy Sindell & Milo Sindell June 15, 2016

    Why Leadership Development Needs to

    Be Updated

    Bruce Pfau| April 17, 2016

    What Do Millennials Really Want at Work? The Same Things the Rest of Us Do

    Heather Clancy | May 11, 2016

    What Your HR Data Can Tell You About Your

    Business

    Ian Davies| March 17, 2016

    Three Ways Technology is Transforming Talent Management in 2016

    Sramana Mitra | July 5, 2016

    The Future of Work:Utopia or Dystopia?

  • The Market is HUGE

    21

    26MUSERS

    ADDRESSABLE MARKET

    $31B

    91MEST. USERS

    CURRENT MARKET

    400MADDRESSABLE SEATS

    CORNERSTONE

    Source: Adapted from Gartner, IDC, US Census Bureau

  • Opportunities Abound

    ü Continued Core Market Sales

    ü Global Expansion

    ü Market Segmentation

    ü Vertical Opportunity

    ü Installed Base Opportunity

    ü Extended Enterprise

    22

  • Accelerating Client Traction

    23

    2003-2005 2010 2012 20142008

    2009 2011 2013 20152006-2007

    Key Client Additions

    12 21 44 73 105 168280

    481805

    1,2371,631

    2,153

    2,595

    0400800

    1,2001,6002,0002,4002,800

    2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

  • Expanded Global Footprint

    24

    Europe, Middle East & Africa

    Select Notable Clients Select Notable Clients

    JAPAN CHINA

    AUSTRALIA

    JAPAN

    INDIACHINA

    Asia Pacific

    SWITZERLAND SPAIN

    NETHERLANDSFRANCEUNITED KINGDOM

    GERMANY

    8 29OFFICES LANGUAGES EST. USERS

    7 9 2MOFFICES LANGUAGES EST. USERS

    7M

  • 25

    Purpose-built talent management solution for Growing Businesses• Mobile ready

    • Self configurable

    • 3 hour deployment

    • Bundled training

    Growth Edition for Small Business

  • HAVE 2+ MODULES

    Approximately

    70%

    Installed Base Penetration

    2+ 2+ 2+ 2+ 2+ 2+ 2+ 2+ 2+ 2+

    2+ 2+ 2+ 2+ 2+ 2+ 2+ 2+ 2+ 2+

    3+ 3+ 3+ 3+ 3+ 3+ 3+ 3+ 3+ 3+

    3+ 3+ 3+

    HAVE 3+ MODULES

    26

    2+

    Approximately

    40%

  • Installed Base Opportunity

    27

    0

    250

    500

    750

    1,000

    1,250

    1,500

    1,750

    2,000

    2,250

    2,500

    2,750

    Learning Performance Recruiting Analytics

    Existing Client Penetration Client Opportunity

    Num

    ber o

    f Clie

    nts

    Four key pillars, each a suite, and half of it GREENFIELD

    Calculated based on 2,730 clients with approximately 9,600 users on average

    60% penetration

    among other

    products results in

    incremental $800M+

    opportunity

  • Extended Enterprise Opportunity

    28

    Engage & enable the entire ecosystem

    • Training for profit

    • Partner enablement

    • Customer engagement

    • Crowdsourcing

  • The FutureBeyond 2016

  • 30

    üFIRST to the Cloud

    üFIRST to do Integrated Talent Management

    üFIRST to include SocialNetworking in TalentManagement

    üFIRST to do client success management

    üFIRST to understand consumerization of the enterprise

    üFIRST to integrate full machine learning

    Cornerstone is Visionary

  • Cornerstone has “Massive Data”

    31

    Userü Positionü Previous Positionü Educationü Skillsü Certificationsü Accomplishmentsü Languagesü Organizationü Preferences

    Collaborationü Connectionsü Live Feed (Status)ü Feedbackü Actionsü Snapshotü Teamsü Discussionsü Badgesü Likesü Comments

    Talent Organizationü Transcriptü Performanceü Skills ü Goalsü Assessmentsü Dev Plansü Successionü Compensationü Applicantsü Applicant Status

    ü Industryü Business Unitü Departmentü Divisionü Regionü Groupsü Hierarchiesü Cost Centerü Gradeü Location

    26.3M USERS | 191 COUNTRIES | DECADE OF DATA

  • 32

    REPORT

    Cornerstone Reporting

    Standard & custom reports embedded

    with Cornerstone

    DISCOVER

    Cornerstone View

    Highly visual dashboards that can easily slice/ dice

    talent information

    PLAN

    Cornerstone Planning

    Big data solution for workforce planning

    PREDICT

    Cornerstone Insights

    Predictive analytics for managing

    talent decisions

    Cornerstone Analytics

    32

  • 33

    IMPORT INTEGRATE

    Edge Import

    Easily map and load data into Cornerstone

    Edge Integrate

    Easy build & manage integrations with 3rd-party apps

    BUILD

    Edge Build

    Create new apps using Edge APIs & developer tools

  • The Power of Platform

    34

    Multi-tenant REST APIs Mobile-Ready

    Cornerstone Apps Partner Apps Custom AppsOne unified suite to recruit, train, develop, & connect

    employees

    Marketplace of apps integrated & embedded within

    Cornerstone

    Client-specific applications designed & built by clients

    or partners

  • Thank You!