EverCommerce Inc.

Good day. Thank you for standing by and welcome to EverCommerce Incorporated 3rd Quarter 2021 Earnings Conference Call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone keypad. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Brian Danew. Please begin, sir.

Good afternoon, and welcome to EverCommerce's earnings conference call for the third quarter of fiscal year 2021, which ended on September 30th. On the call with me today is Eric Reamer, EverCommerce's chief executive officer, Mark Thompson, EverCommerce's chief financial officer, and Brad Korch, EverCommerce's new SVP and head of investor relations. A complete disclosure of our results can be found on our press release issued today, which is available on the investor relations section of our website and on our quarterly report on form 10Q to be filed with the SEC. Today's call is being recorded and a replay will be available from the conclusion of the call. Statements made in this call may include forward-looking statements regarding our financial results, products, customer demand, operations, the impact of COVID-19 on our business, and other matters. These statements are subject to risks, uncertainties, and assumptions and are based on Magnet's current expectations as of today It may not be updated in the future. Therefore, these statements should not be relied upon as representing our views as of any subsequent date. In addition to any risks that we highlight during the call, important factors that may affect our future results are described in our most recent SEC reports and today's earnings press release. We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of non-GAAP to GAAP historical measures is provided in our press release and investor presentation which are posted on our investor relations website at investors.evercommerce.com. The primary differences being depreciation and amortization, stock-based compensation, acquisition-related costs, and other non-recurring costs. In terms of the agenda for today's call, Eric will provide a quick overview of our third quarter results, as well as our market opportunity, growth strategy, and an overview of our recently announced acquisition, Dr. Cardo. Mark will provide a detailed review of our third quarter results, as well as our guidance for the fourth quarter and full year 2021. With that, let me turn the call over to Eric.

Thank you, Brian. Welcome, everyone, to EverCommerce's third quarter financial results call. Let me start by welcoming Brad Korsch, the EverCommerce team. Brad joins us from Denver-based Zayo Group, which some of you may recall was publicly traded until they were taken private at a $14.3 billion valuation. I'm excited to share some updates since our last call, including a strong third quarter and some additional color on our recently announced acquisition of Dr. Crono, which is a great strategic fit and meaningful expands our footprint in health services. I would like to begin with a few highlights of our Q3 financial results, which exceeded our guidance for both revenue and adjusted EBITDA. We reported total revenue of $128.5 million, up 44% year-over-year, and up 20% year-over-year on a pro forma basis. adjusted EBITDA of $29 million, representing a 23% margin. We are pleased with this very strong performance, which underscores the power of our suite of software solutions, purpose-built for the service economy. We offer our customers differentiated, modern SaaS applications integrated with other value-added solutions, such as payments, customer engagement, and marketing applications, and have combined these with best-in-class, digitally-driven customer acquisition model. This drives a unique value proposition, enabling EverCommerce to efficiently sell and scale into this fragmented trillion-dollar market. We are just at the beginning stages of helping small service businesses digitally transform how they work and interact with their customers. To drill down into our approach a little more, a key element of our strategy is to deliver vertically and micro-vertically tailored solutions that solve specific business problems for SMB service providers in the home services, health services, and fitness and wellness vertical markets. This sounds straightforward in theory but is unique in practice as you have to have the right solution for each customer. A physician practice, roofer, beautician, gym owner, and plumber all need software to help run their data operations, but their needs are different and unique to their markets. To be successful in these markets, you have to provide solutions that solve these unique pain points and are ready to use out of the box with immediate time to value. Our system of action business management solutions, the core solutions for SMB service providers to manage the business are how we attract and land new customers. This gives us a huge opportunity to cross-sell horizontal solutions like integrated payment processing, customer engagement, lead generation, and marketing technologies that are broadly applicable to all of our customers. We have seen great success cross-selling our integrated payment solutions. To give you a sense of the scale of our payment business, at the end of Q3, our estimated annualized run rate of total payment value, or TPV, was over $8.6 billion. This represents a 15% increase since the end of 2020. As exciting as the success is, we've only scratched the surface of our opportunity integrated payments, which we estimate exceeds $77 billion just among our current customers. To further enhance our cross-sell progress and integrated payments and other horizontal solutions, earlier this year we hired Stone D'Souza as our Chief Operating Officer. In this role, Stone is spearheading our efforts to take advantage of this huge integrated payment opportunity as well as drive additional product integrations and go-to-market campaigns similar to his experience at both Intuit and Sage. Refining and optimizing our up-sell cross-sell strategy is a key priority and a long-term revenue growth driver for the business. A component of this strategy will be to create consistent branding of our solutions that we believe will raise awareness and simplify the selling process over time. For example, we recently simplified and consolidated the branding of our performance marketing solutions. Under the EverConnect brand, which connects businesses with consumers shopping for services in the local area, we've consolidated three of our existing digital marketing businesses and will make lead generation and branding campaigns simple to tailor to our customers' needs. Looking at the performance of our three verticals during the quarter, we saw positive results of our strategy. EverPro, which focuses on home services, continues to be our largest and fastest-growing segment. Historically, these micro-verticals like plumbing, landscaping, and general contracting had seen some of the lowest technology adoption of any market. But in recent years, as demand for services has grown and consumers have gotten used to digital engagement in all other areas of their life, These small businesses have come to recognize they must deploy technology to increase efficiency and meet customer preferences. The changes that were thrust upon many of these businesses due to the pandemic restrictions over the past 18 months underscore the value proposition of our solutions, which includes a variety of contactless digital solutions. Our SMB customers recognize going back to the old way of doing business is not an option, which we believe will accelerate digitization in years ahead. and we feel we are well-positioned to take advantage of this increasing demand for solutions to help SMB service providers better grow their business, manage their operations, and retain their customers. Everwell, our fitness and wellness vertical, experienced sequential improvement despite pandemic-related headwinds due to restrictions on certain micro-verticals like gyms and fitness boutiques in a few select geographies as of the UK, New Zealand, and Australia. While fitness and wellness are as small as vertical, we are pursuing a number of exciting growth initiatives, leveraging the breadth and depth of our vertically tailored solutions. A good example is expansion of our relationship with World Gym International, which has selected EverCommerce Solutions to be the designated supplier of club management, billing, and CRM software at the North American locations. An existing user of our CRM solution provider, WorldGM viewed the combination of the strength of each of our individual solutions and our ability to offer them as an integrated, complete offering as a critical differentiator. EverHealth, our health service vertical, had a strong quarter and is benefiting the growing demand for patient engagement solutions due to patients' desire for more personalized, consumer-like experience. In today's world, patients don't want to wait on the phone to schedule or reschedule an appointment or get test results. They want it at the tip of their fingers. Similar to the value they receive through our billing and practice management solutions, physicians and practitioners are recognizing the positive impact of introducing patient engagement solutions to improve their experience, which ultimately drives higher revenue and upgrade efficiencies for the practice. We also recently announced a significant acquisition that will further build out our capabilities in EverHealth by adding an important system of action. Back to Chrono is an all-in-one cloud-based practice management EHR billing solution that serves more than 4,600 independent practices and 13,000 providers across various medical specialties. Dr. Crono is at the forefront of digitizing the patient experience of leveraging mobile technologies to streamline engagement and create a true consumer experience. Dr. Crono is a terrific example of a strategic approach to M&A and meets all of our key criteria. We're extending our reach and key vertical market with a very robust system of action. With its large customer base, Dr. Crono also expands our market share within health services. With the acquisition, we are also increasing our opportunities to cross-sell embedded payments and other EverCommerce customer engagement solutions. And from a financial and operational perspective, Dr. Crono's growth prospects are quite attractive, and onboarding their solutions to our centralized platform will drive significant efficiencies. Once we close the acquisition, expected to be mid-November, we intend to quickly onboard Dr. Crono's solutions and our plan to cross-sell embedded payments patient engagement, and marketing technology solutions to the more than 4,600 physician practices. We continue to execute well in centralizing operations, integrating and cross-selling solutions, which are core components of our growth strategy. A great example is Service Fusion, a leading provider of software for field service customers, including HVAC refrigeration, plumbing, electrical, appliance repair, garage door, equipment, and security businesses. We acquired this solution in October 2020 and immediately began the process of integrating payments, marketing, and customer engagement solutions. The results have been impressive in a very short period of time. We've increased our monetization of payment volume by 38% and attachment rates by 11%. In Q3, we launched an integrated customer marketing module powered by our customer lobby software, and approximately 80 Service Fusion customers have adopted it within the first 90 days. Finally, leveraging our centralized services, we quickly optimized Service Fusion's marketing tactics and KPI utilization, resulting in a 24% increase in customers acquired through digital channels. The net result has been a 15% increase in ARPU in a short time since acquisition. These results are an excellent example of how we can quickly optimize newly acquired solutions. Before I turn over to Mark, I want to finish by reinforcing how pleased we are with our performance. We have momentum across our business and are tracking well against our near and long-term objectives. We are delivering on our organic growth targets, and acquisition of Dr. Crono is a great example of our M&A strategy in action. We are rapidly approaching $1.5 billion in annual revenue. We are confident in our ability to grow to many times that size while also generating significant profitability. Our results show our strategy is successful, and we believe we are in a great position to drive incredible value for our customers and shareholders over time. I'll now turn over to our CFO, Mark Thompson. Mark, over to you.