HubSpot, Inc. · NYSE:HUBS
HubSpot — Investor Presentation (November 2023)
28 slides from HubSpot's investor presentation, November 2023
Slide 1: HubSpot Overview Q3 2023
HubSpet HubSpot Overview Q3 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding management’s expectations of future financial and operational performance and operational expenditures, expe
Slide 3: HubSpot is a leading CRM platform for scaling companies
HubSpot is a leading Customer Relationship Management platform for scaling companies. Our mission is to help millions of organizations grow better. 3
Slide 4: HubSpot at a Glance
HubSpot at a Glance $2.1b $280m2 194k 7.5k TTM revenue TTM FCF customers employees 26%1 14% 22% 120+3 YoY growth margin YoY growth countries 1 As-reported YoY growth based on trailing twelve month period as of Q3 2023, compared to prior trailing twelve month period as of Q3 2022. 2 FCF = Free Cash F
Slide 5: Our foundational choices
Our foundational choices • Focus on SMB • Move from app to suite to platform • Build products organically • Deliver value before you monetize 5
Slide 6: The SMB market is underserved
Sales Data Acquisition Productivity Service The SMB market Ticketing Analytics Reporting Acquisition Websites Acquisition Data Sync is underserved Messaging Acquisition Marketing Service Automation Acquisition Reporting Marketing Automation Acquisition Disconnected point solutions Cobbled enterprise
Slide 7: HubSpot is well positioned to solve this problem
HubSpot is well positioned to solve this problem Sales Data Acquisition Productivity Service Ticketing Analytics Reporting Acquisition Websites Acquisition Data Sync Messaging Acquisition Marketing Service Automation Acquisition Reporting Marketing Automation Acquisition Disconnected point solutions
Slide 8: From a single app to platform
To help our customers make connections, we’ve transformed from a single app to platform AI-Powered Lead Generation Prospecting Help Desk Content Creation Advanced Reporting Payments & Subscriptions Marketing Deal Self Service Content Process Automation Management Management Automation Billing & Invo
Slide 9: HubSpot AI: Powering all Hubs + platform
HubSpot AI: Powering all Hubs + platform AI Assistant in Text Editors Content remix to ads + social AI Assisted Report Creation AI Assistants AI Content Recommendations Generate campaign + social copy AI Powered Content Ideas AI Powered Image Generation Generate marketing + sales emails AI Knowledge
Slide 10: What matters to our customers?
What matters to our customers? Acquire Make Improve Increase Thrive with AI customers data-driven customer efficiency decisions experience Quality rather Being smarter Winning where Don’t scale chaos. We want to show up than quantity. with our data. winning like people, not matters. bots. Sr. CRM Ma
Slide 11: Early stages of large TAM opportunity
Early stages of large TAM opportunity $77b 1 $51b 1 <10% Penetration across all product and customer segments 2023 2028 1 Includes Total Addressable Market for software in HubSpot’s core product groups including Marketing Hub, Sales Hub, Service Hub, Operations Hub and CMS Hub. Does not include Comm
Slide 12: Our focus is on driving broad and efficient distribution
Our focus is on driving broad and efficient distribution Who is buying Digital, sales and partner-driven Large Digital and sales-driven Medium Digital-driven Small How we are serving 12
Slide 13: Building a company future generations will be proud of
Building a company future generations will be proud of #2 Best Place to #3 Best CEOs for 100 Best Best Workplaces Work in 2022 by Women by Companies to for Millennials™ Glassdoor Comparably Work For® by by Great Places to Great Places to Work Work 13
Slide 14: The HubSpot Journey
Clearbit The HubSpot Journey Acquisition 3 Commerce Hub Launch Operations Hub Launch CMS Hub Payments Launch Launch $2b 100K Customers ARR 2 PieSync CRM Acquisition Launch Service Hub Launch $1b Sales Hub ARR 2 Launch 1 Performable Acquisition $500m Marketing Hub Launch $250m $100m $50m '06 HubSpot
Slide 15: HubSpot is positioned for long-term, durable growth
HubSpot is positioned for long-term, durable growth Mission Help millions of organizations grow better. Aspiration Become the #1 Customer Platform for scaling companies. Product Strategy Power our Engagement Hubs and Smart CRM with AI. Go-to-Market Scale breadth of distribution with multiple GTM mot
Slide 16: Financial Overview Q3 2023
Financial Overview Q3 2023 I
Slide 17: Strong Revenue Growth
Strong Revenue Growth Quarterly Revenue $558m Q3’23 revenue $558m revenue growth yoy 24%1 $82m Q1’17 Q3‘23 1 Excludes impact of foreign currency. Q3’23 revenue growth was 26% as reported and 24% in constant currency. Constant Currency is presented by converting current and comparative prior period o
Slide 18: Strong Customer Growth
Strong Customer Growth Total Customers 194k Q3’23 customers 194k customer growth yoy 22% 31k Q1’17 Q3‘23 18
Slide 19: Growing Profitability with Scale
Growing Profitability with Scale Quarterly Operating Profit 1 $90m Q3’23 operating profit1 $90m operating profit1 16% margin $1m Q1’17 Q3‘23 1 Non-GAAP operating profit excludes expenses associated with stock based compensation, amortization of acquired intangible assets, acquisition related expenses and
Slide 20: Philosophy on balancing growth and profitability
Drive durable Philosophy revenue growth at scale on balancing growth and Generate operating profitability leverage as we scale toward long-term margin targets 20
Slide 21: Strong Track Record of Profitable Growth
Strong Track Record of Profitable Growth Annual Revenue Annual Operating Profit 2 $317.5m $2,145m 1 GR CA % 34 $376m $9m 2017 2023e 3 2017 2023e 3 Operating Profit Margin (%, as reported) 2 1 CAGR: compound annual growth rate. Based on as-reported revenue from 2017 to 2023e. 2 See definition and reconci
Slide 22: Increasing Free Cash Flow Generation
Increasing Free Cash Flow Generation Trailing Twelve Month Free Cash Flow 1 $280m Q3’23 free cash flow1 $65m cash position $1.7b $14m Q1’17 Q3‘23 1 1 Free Cash Flow Margin Free Cash Flow (Trailing Twelve Month, %) (Trailing Twelve Month, $m) 1 Free cash flow is a non-GAAP metric and is defined as cash
Slide 23: Long term financial targets
Long term financial targets 2026 Long Term 2022 Q1’23 Q2’23 Q3’23 Target Model1 Target Model1 Gross Margin 83% 84% 85% 85% 84% 81% - 83% R&D 19% 19% 20% 19% 20% 20% % of revenue S&M 45% 44% 43% 42% 36% - 38% 30% - 35% % of revenue G&A 9% 8% 8% 8% 8% 8% % of revenue Operating 10% 13% 14% 16% 18% - 20%
Slide 24: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations
Slide 25: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations 25
Slide 26: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations 26
Slide 27: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations 27
Slide 28: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations * All amounts are trailing twelve months 28