First Advantage (FA) The 44th Annual William Blair Growth Stock Conference summary

Company overview and vertical strategy

• Operates globally in employment background screening, identity, and verification, with a focus on compliance and safety for onboarding employees.

• Vertically aligned, prioritizing high-turnover sectors, especially hourly workers, which make up over 70% of business.

• Largest verticals are transportation and retail e-commerce, with a strong presence in healthcare.

• Tailors product suites, such as RoadReady for transportation, to meet specific regulatory and operational needs.

• Deep industry knowledge and specialized products drive customer retention and new business wins.

Market landscape and technology differentiation

• Operates in a $13 billion total addressable market, which is highly fragmented with many competitors.

• Automation, speed, and risk management are key differentiators, with turnaround times now measured in hours.

• Investments in robotic process automation, APIs, and AI have driven efficiency and market-leading EBITDA.

• Consistent growth in new client wins across mom-and-pop, mid-market, and public company segments.

• Upsell/cross-sell and low attrition rates contribute to a stable 8%-10% annual growth algorithm.

International expansion and macro trends

• International revenue (EMEA, India, APAC) accounts for about 13%, with EMEA leading due to digital identity product uptake.

• India and APAC have faced macro headwinds but are showing early signs of recovery, especially in first-time screening clients.

• APAC strategy has shifted to focus on hourly workers in industries like mining and airlines, yielding new business.

• Americas' major verticals (transportation, healthcare, retail e-com) have remained resilient, while salaried worker-focused sectors lag.

• Macro outlook for 2024 expects sequential improvement, with potential for flat or slightly positive base growth in Q4.