The presentation discusses HubSpot's forward-looking statements regarding its expectations for cash flow and margin improvement, ability to execute on its growth strategy in the mid-market, and ability to expand its leadership position and market opportunity for its inbound platform. It notes that actual results may differ from forward-looking statements and will be affected by risks including HubSpot's history of losses, ability to retain and add customers, continued market growth, ability to differentiate its platform, and ability to manage growth. Financial information shows steady revenue growth and progress towards improved gross and operating margins.
2. Important Information
2
This presentation includes certain โforward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements concerning our cash
flow and margin improvement expectations, our position to execute on our growth strategy in the mid-market, and our ability to expand our leadership position and market opportunity
for our inbound platform. These forward-looking statements include, but are not limited to, plans, objectives, expectations and intentions and other statements contained in this press
release that are not historical facts and statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" or words of similar
meaning. These forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based on the information currently
available to us and on assumptions we have made. Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in or suggested by those forward-
looking statements are reasonable, we can give no assurance that the plans, intentions, expectations or strategies will be attained or achieved. Furthermore, actual results may differ
materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond our control including, without limitation, our
history of losses, our ability to retain existing customers and add new customers, the continued growth of the market for an inbound platform; our ability to differentiate our platform
from competing products and technologies; our ability to manage our growth effectively to maintain our high level of service; our ability to maintain and expand relationships with our
marketing agency partners; our ability to successfully recruit and retain highly-qualified personnel; the price volatility of our common stock, and other risks set forth under the caption
"Risk Factors" in our Quarterly Report on Form 10-Q fort he quarter ended March 31, 2017 and our other SEC filings. We assume no obligation to update any forward-looking
statements contained in this document as a result of new information, future events or otherwise.
3. Sales and Marketing Customers
A Global Inbound Sales & Marketing SaaS Company
Cambridge, MA | Portsmouth, NH | Dublin, Ireland
Sydney, Australia | Singapore | Tokyo, Japan | Berlin, Germany (Q3 2017)
31,000+
Countries
90+ 6
Office Locations Worldwide
3
5. 2006
Humans are changing.
94%
skip TV ads
94%
unsubscribe
from email
27%
direct mail
isnโt opened
50%
are on do not
call lists
5
Base: Varied bases, minimum 598 global digital consumers
Source: HubSpot Global Interruptive Ads Survey, Q4 2015 โ Q1 2016.
8. How Does Inbound Work?
Aggressively pushes
content at innocent
bystanders, interrupting
their life
Pulls in prospects by offering
helpful content and
experience when
they need it
VS.
Outbound Inbound
SEO | Blogs | SocialCold Calling | Spam | Interruptive Ads
8
9. Inbound is about the size of your brain,
not the width of your wallet
Helpful | Human | Personal | Transformational | Empowering | Educational
9
15. 150,000+
Marketers
Where the inbound
movement grows the
other 360 days of the year
19,000+ Registered
Attendees
Where the inbound movement
grows every year
โ 37% more registered
attendees in 2016.
โ 250+ speakers; hundreds of
hours of content
Thousands of Partners
HubSpot provides training and support to
our marketing agency partners, working
together to sell our products.
60,000+
Certifications
HubSpotโs one-stop-shop
for free education on all
things inbound
49,000+
Linking Domains
The number of websites linking back
to HubSpot, providing us with both
authority in search engines and
recognition among industry
professionals
15
16. Marketing Pricing
Upgrade based on database
size
Cross-sell
Sales product
Sales Pricing
Cross-sell
Marketing product
Upgrade based on
number of seats
16
18. F I N A N C I A L R E V I E W | F I R S T Q U A R T E R - 2 0 1 7
18
19. Summary
Fast-growing SaaS platform with positive mix-shift towards
multi-product offering
Largely untapped global opportunity for growth
Margin improvement allows for incremental
improvements in cash flow
Commitment to balancing top and bottom line growth
allows for continued operating leverage
19
20. $30.4 M
$34.2 M
$38.2 M
$42.9 M
$47.7 M
$53.1 M
$59.0 M
$65.0 M
$70.6 M
$76.4 M
$82.3 M
Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17
51% Y/Y
53% Y/Y
58% Y/Y
58% Y/Y
57% Y/Y
56% Y/Y
54% Y/Y
51% Y/Y
48% Y/Y
44% Y/Y
40% Y/Y
Revenue
A Global Inbound Marketing & Sales SaaS Company
20
22. Steady progress in Gross & Operating Margin Trajectory
22
All percentages for historical period are non-GAAP (other than CFFO) and exclude expenses associated with stock based compensation
and amortization of acquired intangibles. Please refer to the end of this presentation for a reconciliation of GAAP to non-GAAP figures.
23. Framework for
Growth &
Profitability
Revenue Growth
Operating Margin %
Operating Cash Flow Growth
<30%
3-4%
increase per year
Moderate Growth
>30%
1-2%
increase per year
โ Revenue Growth
High Growth
~30%
2-3%
increase per year
Growth
23
24. 24
Long-term Model
2014 2015 2016 Q1โ17
GROSS MARGIN 70% 75% 78% 80%
R&D
as % of Revenue
17% 14% 14% 13%
S&M
as % of Revenue
63% 58% 55% 52%
G&A
as % of Revenue
18% 16% 14% 13%
OPERATING
MARGIN
(28%) (14%) (4%) 2%
Target Model
80%
15%
30 - 35%
10%
20 - 25%
All percentages for historical period are non-GAAP (other than CFFO) and exclude expenses associated with stock based compensation
and amortization of acquired intangibles. Please refer to the end of this presentation for a reconciliation of GAAP to non-GAAP figures.