Clearwater Analytics (CWAN) Citi's 2024 Global TMT Conference summary

Business overview and value proposition

• Provides investment accounting, performance, risk, compliance, and reporting for investment assets, delivering daily, clean, reliable data to clients.

• Evolved from serving corporates to insurance companies, now with 52% of ARR from insurance and two-thirds of revenue from asset owners.

• Platform's single security master and cloud-based, multi-tenant architecture create network effects, driving efficiency and quality.

• Clients benefit from scalable, trusted data and high retention rates, with 98-99% gross retention and strong NPS.

Multi-product strategy and growth metrics

• Transitioning to a multi-product platform, expanding both organically (e.g., LPX) and inorganically (e.g., Wilshire risk models acquisition).

• 25% of bookings in the first half of the year were from incremental products, showing early traction.

• Net revenue retention (NRR) stands at 110, with a target of 115, driven by price increases, wallet share, AUM growth, and new products.

• New products are expected to contribute 7% to NRR, with a portfolio approach to product innovation.

• Ongoing investment in new product development, with more announcements expected soon.

Revenue drivers and visibility

• Price increases are managed by a dedicated team, contributing about 3% to growth.

• Wallet share is driven by relationship managers targeting both core and strategic asset managers.

• AUM growth is influenced by client activity, market rates, and business model changes, with a shift to a base-plus model for predictability.

• The company takes a portfolio approach to growth, not relying on any single product or client.