Thryv (THRY) Investor Day 2024 summary

Strategic transformation and market outlook

• Transitioning from legacy print and marketing services to a SaaS platform, with a focus on small businesses and a goal to double ARPU from $4,000 to $8,000 by the end of the decade.

• Acquisition of Keap for $80M accelerates SaaS growth, adds automation, expands the partner channel, and secures 15,000 SaaS clients, targeting $10M EBITDA synergies in 2025 and $50M revenue synergies over three years.

• Majority of revenue now comes from SaaS, with EBITDA crossover expected in 2026, positive EPS in H2, and a return to overall growth in 2027 as SaaS outpaces the decline in legacy services.

• The company is winding down Marketing Services, with final directories published by 2028, targeting $250–$300M in cash flow from print through 2028–2030, and migrating customers to the SaaS platform.

• International expansion is supported by Keap’s 20% international customer base, with further localization planned.

Product development and innovation

• Expanded product suite includes Business Center, Marketing Center, Command Center, Keap Automations, Reporting Center, and the upcoming Workforce Center for payroll and HR.

• Reporting Center, launched as a mobile-first solution, provides actionable insights and is expected to drive retention and upmarket growth.

• Workforce Center, set for 2025 release, will centralize employee management and payroll, supporting the move to larger small businesses.

• AI is being integrated across the portfolio, with features like CaptionAI for Social and AI Review Response to enhance usability and efficiency.

• Platform strategy enables cross-selling, with 88% of customers currently single-product users, presenting significant upsell potential.

Financial guidance and growth drivers

• 2025 outlook: organic SaaS revenue growth of 18–20%, Keap revenue of $75–78M, SaaS adjusted gross margin ~74%, and mid-teens SaaS EBITDA margin.

• Achieved 101% net revenue retention and surpassed Rule of 40 with 41% in Q3 2024, driven by SaaS growth and operational efficiencies.

• Gross margins on software products now exceed 70%, with a clear path to 80% by decade’s end as higher-margin centers are sold.

• Robust cash flow projected, with $250–$300M unlevered FCF from print runoff (2025–2030) and deleveraging ahead of schedule, with principal payments prepaid through Q3 2025.

• By end of decade, targeting ~$1B in SaaS ARR and $200M in EBITDA, with further upside possible from customer base expansion.