Specialist
Former executive at Anaplan Inc
Agenda
- Anaplan and its cloud planning platform, highlighting differentiation and use cases, including finance, supply chain and sales
- Impacts from the macroeconomic backdrop, noting sales cycles and pricing
- Operating risks, including challenges without a reporting solution and lack of modelling talent
- Competitive landscape, addressing OneStream
- Recent go-private transaction and M&A possibilities
Questions
1.
How would you describe Anaplan and its evolution, particularly over the past couple of years? You spent a couple of years there and were brought in to jump-start growth in certain areas, among other things. How did the company evolve over that period?
2.
I think it’s fair to say that within software and SaaS, the theme of verticalisation has gained notable traction and momentum over the last couple of years. Do you think the focus was more on specific industries or was it more with respect to building out and fortifying the use cases that Anaplan historically focused on?
3.
You indicated that Anaplan would sell into the office of the CFO historically, but over the last couple of years, it seems the company has increasingly looked to sell to the finance organisation or other divisions within companies. Could you elaborate on that development and shift?
4.
You referenced customers and prospects increasingly valuing Anaplan and its agile planning solutions amid coronavirus and a lot of related issues, probably on both the supply and demand side of what the business was doing. The company’s P&L shows growth of around 40-45% in FY18, FY19 and FY20, whereas post-pandemic FY21 and FY22 had growth closer to 30%. If Anaplan was well-positioned and benefiting to some extent from more of a need and more demand during coronavirus, why did we see a downshift in revenue growth then?
5.
During your time at Anaplan, what was the company’s win rate when competing directly with OneStream? From the way you were describing it, it seems Anaplan probably lost more often than it won against OneStream.
6.
What companies would fit the bill in terms of a reporting capability that probably has at least a cloud front end, if not a complete infrastructure stack? Presumably something that's not so big that it’s going to be tough to bring in and integrate, but also not so small that it fails to be impactful enough.
7.
You said coronavirus probably opened a lot of people’s eyes to the need and value associated with Anaplan, and the solutions it provides. How are you thinking about today’s economic backdrop, whether recessionary or just uncertain? How might this impact the company in 2023?
8.
You said it might take other software a while to stand up – I think it’s important to draw this distinction because it’s probably a competitive differentiator, not just the quality of agile forecasting and planning but also the speed with which the solution can stand up. If you took an average time it would take to deploy a competitor’s solution, how long are we talking? If Anaplan takes 1-2 months, would it be 3-6 months for other solutions?
9.
How would you set a benchmark? I’ve heard that Anaplan is harder to sell compared to other SaaS or enterprise software, in part, because people have to buy into the platform’s vision and utility. As you pointed out, it’s hard to figure out early on – you have to sit down, explain it and do some other things to get people over the line. Is that right?
10.
What do you think is the average sales cycle or time period for selling Anaplan?
11.
For a while, it was difficult to try to pin down what Anaplan considered its TAM. There were references to roughly USD 20bn TAM in 2019, the year after the company went public, but also references to as much as a USD 70bn TAM. In the last month or two, maybe in conjunction with some of the leadership changes I alluded to, I saw indications of a USD 20bn TAM or more. Is that overly conservative? How should we be thinking about the TAM?
12.
We’ve been discussing Anaplan from more of a finance angle, but there are six different large focus use case areas – sales, finance, supply chain, workforce, marketing and IT. I’m sensing from our discussion that finance is not just a priority but the priority. Could you ballpark the percentage of revenue that comes in from the finance function?
13.
Do you revenue mix in three years would be similar to what it is today or would it change further?
14.
There’s significant interest in what’s going on with supply chain planning, and there are a bunch of companies that do this – Kinaxis, o9 and OMP, to mention a few. How do these companies and Anaplan stack up? It’s noteworthy that Anaplan made its first post-PE acquisition M&A deal, which was focused in and around supply chain – clearly, it’s a priority. How do you think the company’s solution stacks up against competitors’?
15.
What about the competition in more of a financial planning context? There are many companies doing this – Board, Jedox, Planful, Pigment, Prophix, Varicent and Vena. Which company is the leader? Who else is in that mix?
16.
What is a typical cost to buy Anaplan vs competitors? It seems the company is the Rolls-Royce or Cadillac solution, if you will.
17.
You said OneStream came from IBM and IBM still has some of these solutions, Oracle, SAP and Workday bought Adaptive. How competitive are those companies directly, especially when so many customers have existing relationships with them? How difficult is it to say, “Do you have this kind of planning solution that we can use? We’re trying to consolidate vendors and trying to save money.” I would think that would be notable in the marketplace, especially now.
18.
What’s your M&A outlook? Anaplan was acquired by a PE sponsor in June 2022 and we already talked about completed M&A deals and M&A possibilities on the reporting side. People are obviously looking at the fact that the PE sponsor has made a move to buy Coupa Software and potentially expecting those two businesses could become increasingly aligned. If you’re the PE sponsor and you own Anaplan, what is the M&A strategy beyond reporting? What should be next?
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