Research Solutions (RSSS) 2024 Southwest IDEAS Conference summary

Market opportunity and business model

• Operates in a $15 billion total addressable market, with $11 billion B2C and $4 billion B2B, focusing on research-intensive organizations and individuals.

• Serves 1,400 customers, including 70% of the top 20 pharma companies, with academic libraries as the fastest-growing segment.

• Business model is transitioning from low-growth, low-margin transactional revenue to high-growth, high-margin SaaS platform revenue.

• SaaS platform revenue now comprises 36% of total revenue, with gross margins of 85%+ and high retention rates over 100%.

• Most growth is expected from new customers, especially in the search segment, with Scite and Resolute projected to grow over 100% for the next 2.5 years.

Product offerings and technology

• Main products are Scite (AI-powered research discovery) and Article Galaxy (legacy article management and delivery).

• Scite offers unique full-text AI search, citation analysis, and research integrity scoring, differentiating it from competitors.

• Article Galaxy supports document acquisition, management, and compliance, serving both corporate and academic clients.

• Platform integrates rights management, collaboration, and advanced analytics, with plans to add patent and conference data search.

• High customer fidelity with renewal rates above 90% and net renewal rates between 100-110%.

Financial performance and outlook

• Annual recurring revenue (ARR) grew from $6.3M in FY22 to $17.6M in Q1 FY25, with SaaS CAGR of 40-46% over eight years.

• Adjusted EBITDA reached nearly $4M and cash flow from operations exceeded $5.1M in the trailing 12 months.

• Cash balance increased from $2.7M post-Scite acquisition to $6.9M, supporting organic growth and potential M&A or buybacks.

• Transactional business remains stable with single-digit growth, while SaaS platform drives profitability and margin expansion.

• SG&A increase mainly due to acquisitions, with stable underlying cost base.