ACV Auctions Inc. (ACVA) Earnings Call Transcript & Summary

All right. Okay. And we're closing the door. There we go. And we're on to our next fireside chat with the team from ACV Auctions. We've got George Chamoun, CEO; Bill Zerella, CFO. George, Bill, thanks so much for being part of this conference this year.

Yes. Thanks, Eric.

Good to be here.

I think what always happens like to do to maybe set the table is just, George, if you want to jump in first and sort of tell people a little bit who don't know it as well, the ACV story. The company you built, what you're solving for in the broader end demand space and how you're positioning the company success for the long term, and then we'll go into a bunch of thematic elements off of that answer.

Yes, certainly. Thanks, everyone, for coming by and learning more about ACV today. So ACV started its journey and really our primary business was to disrupt the wholesale side of automotive. And if you look at the automotive sector, dealers, there's a lot of data out there on the retail side, the dealer is selling cars to consumers. Wholesalers, when a dealer or a commercial type of customer, commercial being repos, off lease, et cetera, are deciding to sell a car to another dealer. Large TAM, around 20 million cars sold a year to dealers. Historically, these vehicles were sold at physical auctions as the primary location and sort of methodology. ACV disrupted this large category by creating the #1 digital marketplace and assets like cars take a lot of trust and transparency to sell them digitally where you don't have to go and see these assets physically. So we disrupted this sort of very large TAM by creating the best inspection technology and the largest network of inspectors. And we layered on additional value-added services to help sell these cars in a digital manner. So scaling the business, very significantly from really launching the business in 2016 until now.

I want to get into all elements of that. But I think the most important piece, at least over the short to medium term as you continue to be subject to a fairly volatile macro environment, especially with respect to the industry itself. So when you think about it and you think about the supply chain, inventory and demand, pricing, sort of where are we now versus where we were 12 or 18 months ago? And how do you think about where we're trying to get to probably 6 to 12 months from now? And what do you think about the landscape more broadly in the auto space and the macro environment in general?

Yes, certainly. So in our most recent earnings, we provided some data showing our typical franchise dealer is selling somewhere around, let's say, 17% to 20% less wholesale vehicles today than they were, to your point, 24 months ago because of all the macro concerns of less cars being sold. They were selling less new cars, they need to keep more of these cars, et cetera. Where are we? I was asked that question earlier by an investor and he asked for it in a baseball analogy, and I thought that was an interesting way of looking at it. And I thought more like the seventh inning stretch would be a good way to think of us as. We're not in the ninth inning, meaning new cars and used cars combined aren't back to where they were and they probably won't be for the rest of this year, but there's some bright spots. The bright spots are that new car manufacturing is starting to -- we're starting to hear some positives. This whole chip thing is getting solved. So we're not going to hopefully be hearing about chips next year. Other bright spots that we're starting to see is, we're starting to see new car manufacturers, even this most weekend, you're seeing Toyota out there saying 2.9% financing for new cars. I heard a lot of folks in this industry say that will never come back. We won't see new car dealers and manufacturers start to push new cars. So I think we'll start to see some normalcy coming into next year. We haven't assumed that for the back half of this year. We've assumed, as we said in our most recent earnings that we're going to just assume not a lot changes this year, but we are starting to see some bright spots for next year.

So just to level set there, because you talked a little bit about thematically the big picture. We try to relate this to investors who call and ask about the company, but I think you'll do a better job than I ever will. You need this sort of normalized environment where supply and demand reach back to some level of homeostasis for your business to really show what you built for the long term. Is that the right way to frame it?

Yes. We couldn't agree more. I mean if you look at our business pre-COVID, we grew very consistently. And I think the hardest thing for investors is you see all these businesses that benefit in COVID, where all of a sudden, digital was needed so much more significantly, our market shrunk with COVID. So it was a little bit more -- it was a significant headwind on supply. And we grew just fine prior to COVID, in fact in a very steady way. The benefit of used car values modulating and the world returning back to normal as it helps as relates to conversion rate in our business, which is like sell-through rate because you're having this consistent used car sort of depreciation. It allows the sellers and buyers to sort of normalize what a car is valued. So yes, I think for us, at the end of the day, it will be a good thing to have things return back to normal.

Okay. And then 2 last maybe underlying pieces with macro and then I want to get back to the big picture and thematic elements of the story. On the last earnings call, you talked about conversion rates creating headwinds for volumes. There continues to be elements of pricing volatility. And I think how should we be thinking about pricing strength in the broader environment. So some of these components of your business that do remain volatile in both directions because of the macro environment, help people better understand what you're seeing and how they evolve going forward as the end demand may be normalized?

So maybe I'll take that one, George.

Sure.

So clearly, used car prices going up was a tailwind for us in terms of our buy fees, right, which is only about 1/3 of our total revenue streams. But really what happened over the last 12 to 18 months are really it was a structural change in our marketplace where we became a much broader-based marketplace where we'll sell $5,000 cars, we'll sell $150,000 cars, okay? And that was a trend that we didn't anticipate. That's accounted for basically half of our improvement in ARPU on the buy -- in terms of buy fees. And we believe that's very sticky and we'll kind of perpetuate and be sustainable on a longer-term basis. There's an increasing level of franchise buyers on our marketplace and they're buying more frontline vehicles. So we're really happy in terms of that trend structurally. In terms of the other half, which relates to price, we are expecting used car prices will come down. We don't think they're ever going back to where they were just because of basic inflation throughout the economy. That said, because buy fees only represent about 1/3 of our total revenue streams. For a 10% reduction in sales price, that would only be a 3% reduction in terms of impact on our revenue. So it's not significant in terms of the impact that you might otherwise think. And just a reminder that our buy fees are below our competitors at this point in time.

Okay. Fair. So maybe zooming back up, let's leave the macro side for a minute. George, I wanted to turn to you. Obviously, you have some views, and I think the company laid out some really interesting slides at your Investor Day earlier this year, and I would tell investors all the time to go back and look, you gave us a lot of information. But if you think about the wholesale market in general and the shifts between offline and online and the role your company is going to play in those ships, how do you frame up the addressable market you're going after as company?

Sure. So we've been able to -- we spent more time helping investors understand the dealer wholesale side of the market and you're just in the early days, hearing us talk about the commercial side. So I'll start with dealer. Simple way to look at where we are today on the dealer side, across the country, we have about 35% of franchise dealers starting their journey with ACV selling and buying cars. And we're getting about 35% of their share. So we're a company that's kind of look at it as really starting to be launched in 2016 to now. We've got our -- we've got the beginnings, early days of getting sort of the seeds spread throughout the country, but we've got more wallet share to go. We've got more product we can sort of be getting into the hands of these dealers. If you look at our mature territories, again, on the franchise dealer side of things, we've got certain territories where we've got over 50% of the franchise dealers using us and we're getting over 50% of their share. We provided some of this data at Analyst Day where we show that we've got early territories where we've got significant share out of the franchise dealers in the market. So if that's all true and you still think, okay, there's still close to 10 million cars selling at physical auctions, it basically means that your -- you've got many parts across the country that are still primarily physical. So think about this as a geographic -- the penetration of digital in the Northeast, where we've been at it for 6-plus years, digital is much higher. Markets like New Jersey and other parts -- you've got a significant penetration of digital. In other parts of the country, physical still has a much higher penetration. But we only -- we might have arrived in the last 6 months, we might have only arrived in the last year. So kind of fast forward 6 years from now, I don't think it's going to be any different. So it's been really fascinating is we're providing you all data like sort of average data across the country, we're providing you data of how well we've been doing at sort of benchmarks of a year, 3 years or 6 years in a given territory. And you're seeing that as we're in a territory longer, we've taken more and more share.

So along those lines, with your go-to-market, you talk a lot about land and expand. Can you just talk about how you set the company up then to sort of execute on that growth over the next 3 to 5 years? What are the building blocks you put in place that then you execute again so we can sort of better measure how market share dynamics continue to evolve?

Yes. So part of our current cost basis, this is all part of the current cost basis and you're seeing us grow into this. We have 160 territory managers who are out building relationships at a store level with dealers -- franchise dealers across the country. They're managed by over 20 of these regional sales directors. They're also out there building those relationships. There's yet a separate team in our current cost basis that's building relationships with major accounts. So major accounts are like the Lithias of the world, the Penskes of the world, Group 1, think largest dealer groups. That team is selling an additional value-added services, such as ACV Private Marketplace, where we're helping them sell cars within their group and helping them build specific sort of selling and buying within a dealer group, which gets dealers now accustomed using ACV. There's yet another part of our sales team go-to-market that's focused on independent dealers. From an inside sales perspective, that's over 80 people. So -- in addition to all those sales efforts, we have another 800-plus inspectors who are walking into dealerships every single day, expanding our relationships. We might be getting 2 cars a month from a given dealer. We might be getting 20 cars a month from a specific dealer. And those inspectors are walking in every single week in growing our share and growing the relationship we have with that dealer. So we're very fortunate that in this go-to-market plan, all of this is in this plan, we are touching these dealers in several ways, which is helping us achieve all these objectives you've heard us talk about.

Got it. And then I want to turn to the product innovation side. Obviously, you guys continue to launch new products, I think, not keep harping on it, but referencing back to the Analyst Day earlier this year, you put a lot of your engineering talent on display. I think people got a good sense of the technology jobs inside the company and how much product innovation there was, but you've also gone out and acquired as well. So can we just broadly talk about your, #1, your strategy around building versus buying in terms of product innovation? What kind of product innovation do you want to highlight for investors that you put in place over the last 12 months? And how should we think about that as key to your strategy going forward?

Yes. At the end of the day, it's a focus on having the value-add beyond any of our competitors to help our customers achieve their goals. So what does that mean? Well, dealers want to acquire more cars from consumers. Dealers want to keep the right vehicles within their dealer group. Dealers want to buy the right cars that they should retail and they should wholesale certain cars based on the asset. So when you think about making the right decisions, we just wanted to make sure we have the right software to help dealers make the right decisions, which helps give us a differentiation to ACV. It helps dealers in making the right decisions they'll end up wholesaling more with ACV as well. So the things we've built were the products I mentioned, like inspection technologies, AC Private Marketplace, buying and selling cars within the dealer group, the things we've acquired are helping us on data services, pricing cars, appraising cars. One of the assets we acquired Monk, it's a self-inspection allows the consumer to inspect the vehicle in a manner where by leveraging AI, we get to learn a ton prior to inspecting a vehicle. So I think the value-add here is all about the pricing of a vehicle. It's all about helping you dealer make the right decisions and acquire more vehicles.

Got it. Okay. And along those same lines, you're building and have built a lot of ancillary services into the business model, capital, transport, data services. Can you talk a little bit about some of what you've built on the ancillary side? How should we be thinking about that being as both a driver of revenue growth, but more importantly, also a driver of some of your longer-term profit margins over the long term, where you've set some big targets in terms of margins over the next sort of 5 years?

I'll start, and then I'll hand it off to you to the second part of that, so we can -- instead of do all the talking here.

We got a bring Bill in.

Exactly, we're a team. So the ACV transportation is growing not only fast, but we're ahead of schedule from a margin perspective and I'll let Bill get into that a little bit. But we're -- what did we do? We built software that allows us to -- while a dealer is bidding in on an auction in ACV, know how much it's going to cost them to move a car from one location to another. So whether it's 50 miles or 500 miles, you're bidding and I want to move this vehicle. So we had to build first, the logistics and transportation load for it. And then we built this programmatic capability where we can actually match the right carrier with KPIs and margin objectives all in real time. And our team just knocked it out of the park. We built all that software after going public. We're way ahead of schedule on our transportation objective. So I'll let Bill go into that a little bit more. But we're really excited, we're turning transportation to like just little this sort of little add-on to really being a great business. ACV Capital is an important value-add. Independent dealers can't go to a local bank and get the funding they need to buy cars. So really, none of the top-tiered banks provide funding to independent dealers. The 2 largest floor planning or financing providers are owned one by Cox, which is NextGear and the second, AFC is owned by KAR. That's #1 and #2. Great business, great margin. We had to first launch the product. We're now scaling the product. And maybe you could expand both of them a little bit.

Yes. I'm just wondering if it might be best if I just kind of took everybody through how we get to the long-term targets for both, revenue and margin...

Sure. That'd be great. Yes, I was going to get there, but I'm about to jump there now, yes.

Yes. So first, our long-term targets do not include any meaningful progress for commercial or international. So that's kind of excluded. So let's start with that. If you look at the top line growth that we projected out to 2026 of $1.3 billion, there are certain key assumptions in our model. So first, we're assuming that our core auction business grows at a 25% CAGR. That's #1. #2, in terms of the ancillary services, so our transport business is already at our target attach rate in 2026 of just over 50%. So it's a matter of just scaling that at the same attach rate as we grow our unit volume. In terms of ACV capital, our target attach rate is 25% and we're at high-single digits today. And with that, we do not lend outside of our marketplace, which our competitors do. In fact, one of our public competitors speaks to roughly over 50% of their revenue on their capital business is outside of their marketplace. So we will get there. We're just not able to do that yet today. So you can think about our high single-digit penetration today versus 25% target in 5 years or less than 5 years now, 4 years as being a very reasonable target for us to achieve, we're on track, okay? And then our SaaS and data services, we are assuming a 45% CAGR there, but that's off of a small base, okay? So that's how you get to the revenue targets that we have in our financial model. In terms of margin targets, so first, we look at a lot of cohort data, right? And we're at a 40% contribution margin in our most mature markets. This is fully loaded with all costs except for R&D and G&A. So that's sort of an underlying dynamic that drives our financial modeling. But if you get more specific in terms of the blended gross margin and our targets, it's 60%, okay? Our current auction business is actually above that. Our core auction business before we get into all the ancillary services is actually more like in the mid-60s when you look at the blend, which includes our auction business, including our assurance business, which is separated on our P&L, but we look at the 2 of those together as a business. We just have to separate it for GAAP purposes. So then if you look at the other margin components, if we think about transport, our targets of 15% margin, we're now in the mid-single digits. So to get to 15% in 4 years, we feel really good. We're actually ahead of schedule. Capital, we're already at our target margins. So that's just a matter of increasing our attach rate. And our SaaS and data services business are just a little bit above our target margin already. So that's a matter of just increasing our volume, which leads to the last piece, which is OpEx and that's all about scale. What's changed there though is we have, over the last few months, really done a lot of work to optimize our OpEx spend and we've made some structural changes like moving more of our engineering offshore. Today, about 1/3 of our total engineering resources are offshore. That was not anticipated in the model that we presented back in March. So add all that up, we feel really good about hitting these targets over time, which $1.3 billion in revenue, 60% margins, 25% EBITDA margins. Hopefully, that was a mouthful.

Yes. There's a lot of good stuff in there. I have additional questions, but I do want to give the audience an opportunity to ask any. So always like to -- we got one in the back. I always like to throw it open to as many questions. Do we have a microphone or should I repeat the question? Oh, we do. We got a microphone, here we go. I would say no one wants me to repeat. One in the back.

Just trying to understand the business model a little bit. Can you compare and contrast it to the CarOffer asset owned by CarGurus because it sounds like they're going after sort of the same end market in terms of digital versus physical auctions?

Yes, certainly. So the business model, I'll try to do both a little bit of how they go-to-market and fees, right, because there's probably 2 sides like the business model. So first sort of go-to-market. CarOffer was one of the first to really introduce programmatic buying where a dealer is buying a vehicle before really seeing it, meaning at the end of the day, a computer is making the decision of buying the asset. So it was a really nice feature that they launched. I'll give them credit for that. They probably also had some benefits of timing in launching that feature, okay? So you saw some significant growth. So they weren't inspecting these cars prior and they weren't really showing these assets -- you don't really see the assets before you buy them. And when the market was exploding, dealers needed inventory desperately and you saw a huge growth rate very quickly in that type of business. Comparing to ours, we're inspecting, we're inspecting let's say, a little under 90,000 cars a month right now. So we're inspecting a lot of cars, which gives us all this data, right, which we're seeing all this data. We're passing that data to the dealer. So when you're bidding on a vehicle on ACV, it's based on this rich data pool. And in our business, the more you all talk to dealers, that's really important. In different sectors, different marketplaces, you might say, how important is this. If you make a mistake on a vehicle, if you're buying a $20,000 vehicle and it's got $4,000 in damages, you're not going to make any money, right? So our business model sort of is to really built on -- when you have the most confident demand because we've built this inspection technology and all these inspectors to get the demand. We've -- since CarOffer did go live, we did add a programmatic buying capability and it's about 15% of our demand today. Our buyers not watching the auction, but a difference between ours and theirs, you actually can get into a rich detail of the inspection and so you're only buying cars that meet a certain condition, okay? And the actual fee side of the model, what's different between us and them is their revenue per unit between sell and buy fees combined might be a little higher than ours at this point. So what Bill mentioned earlier that we probably still have some room between where our sell and buy fees are combined compared to like them and other like physical auctions. We started out -- and we have done one price increase late last year. But over the next few years, it's an area we can keep looking at because our fees tend to be low. And I think with all the value-add we're providing, I think that will be a good debate. How long should we keep our fees as low as they are. But hopefully, that's a quick comparison on business model. Sometimes we mean like go-to-market business model, first like the fees.

[Technical Difficulty]

So we're -- we'll definitely coexist. But I think we're positioned to take the larger piece of the market here because when you look at automotive, you really -- I think what you all be debating is how big is programmatic buying of cars that don't have significant issues versus how big is the market when you look at from junky salvage-type cars to clean, what Bill -- the term Bill uses frontline ready cars, we're after the whole, we're after a larger TAM and our product offering and our go-to-market gives us a significant advantage going after all that.

Maybe off market, did you do it, or the market forced you that one? Is that a plan...

So we -- when you -- if you would have met us a handful of years ago, I would have said to you that Manheim would have been an example. Manheim is owned by Cox of an auction that sells higher-priced cars. And the local mom-and-pop independent auction sells lower-priced cars. So any seller would decide I'm going to send certain vehicles to one auction and I send other vehicles to another auction, okay? And I would have answered it someday, we believe we should be selling -- we should be the marketplace for the entire tent. That's how I would answer the question. I don't know how fast it's going to happen, probably happened a little faster than I was expecting. And franchise dealers buying on the platform, which probably started a little bit more -- a little faster on COVID, which is now feels like it's sticking. They've always been buying on platforms like Manheim. It's not like, oh, just because of COVID, they started buying. But they were introduced to ACV. If you do your homework, you're going to find franchise dealers now prefer our condition report, they want it to have more supply, okay? So I would say, one, yes, it's probably happening faster than I expected, which is a good thing. But structurally, it makes sense. If you're going to buy a $50,000 car or an $80,000 car, do you want to know what the engine sounds like, what the undercarriage looks like. Don't you don't want full paint meter readings. Wouldn't you rather know whether or not there's any vibrations happening on the engine or anything? Like wouldn't you want to know all this data? So we probably even have more advantage in hindsight on higher-priced cars than we do on the junkier car. So even though we started out selling the junkier cars, the more we get into this business, the more we find, we probably have more of an advantage to higher the price.

I think Mark needs the microphone right here.

[Technical Difficulty]

Okay. So I'll start. So in terms of fixed versus variable, I think what's very relevant is what we spoke about in our last earnings call, we were exiting the -- we expect to exit this year at a $40 million lower OpEx level than what we thought we would exit at when we entered into the year. Most of those cost reductions are fixed in nature or at least semi-fixed, if you will. There were some variable portions of it that we pulled back on a little bit because of unit volume expectations. But for the most part, those were fixed in nature and a lot of optimizations that when you're growing really, really fast, it's hard to optimize, right? Last few months, obviously, we've still been growing, but not as fast as we were. It gave us an opportunity to look at how do we optimize the way we run the business and we made some structural changes, like I spoke about earlier in terms of engineering costs, right? That will change our cost curve going forward. Now we're not about to update our targets yet at the next Analyst Day, which we'll probably do next March, we'll reset. We'll add another year and we'll reset what our expectations are. But the biggest variable costs that we have are inspectors more than anything else, right? We basically fully populated the field on the go-to-market side and we protected a lot of that spend when we adjusted our OpEx levels. So we wanted to put ourselves in a position to continue to gain share. So I wouldn't say it's 100% fixed, but the variable portion would be relatively small as we increase our unit volume because once you populate a territory with a territory manager, unless you're splitting the territory because it's grown so much, which is a good thing, by the way. All you're doing is you're adding inspectors as you have more unit volume. So that's the biggest variable piece to our model going forward. Does that make sense? Okay.

I think the way to answer the benefit of the large inspections and our growth is, where we have significant share like we do in the Northeast, what we're really seeing is we are starting to tip the market. And the there are certain markets across the Northeast where it's very hard to compete against us because buyers are getting trained and buying through the ACV way. So when you all do your homework, some of your all interviewing dealers in the Northeast, you're doing interviewing dealers throughout the country, you're going to see like a sentiment. Like if you call on dealers in New Jersey, they're going to be like, I wish I could buy every car on ACV -- buy every car like I do on ACV, okay? So the more they buy this way, the more they get accustomed to having all this data, okay? So one benefit is the more they buy with a lot of data, in a way, you're leading the witness, then you really don't want to buy another way, okay? I would say that sentiment is very strong in the Northeast and we have to take that same strong sentiment and bring it across the country. And you'll find pockets of it throughout the country where we've been in for 2, 3 or 4 years, we're starting to have that same sentiment. The second part is where the data helps us and helps our dealers in making better decisions. So where we can find an engine issue by listening to the engine now 90% of the time just by listening to an engine. We're into early days of correlating vibration with engine issues and we're going to make even better decisions. Now what does that mean? It means that the seller was trying to get $10,000 for the car and really was supposed to be $7,000 or $8,000, right? They're only going to get $7,000 or $8,000 now. So they wanted $10,000. So -- but the buyer now is going to make less mistakes. And if you think about those of you that buy a lot and, let's say, like an Amazon or someone else, you want to be able to confidently buy in a way, return when you return the asset and you don't want it anymore. I know you have the right platform to help you do that. And when I think about my own behaviors as a consumer right now, I literally will pay a little bit more on Amazon than I will -- someone else where it might be a little cheaper somewhere else. And I'm starting to more and more think of ACV that way. More and more thinking like I have a fees lower than everyone else. Like we are providing this huge value-add. They're making less -- they're making less mistakes. And I think the data enables us to make sure the car by car, the sellers inform, hey, this is not a $10,000 car, okay? It's got frame damage, it's got mechanical issues. I know you thought it was a $10,000 car. And if we can help the sellers make more and more those decisions at appraisal, not after they bought it, we'll try to -- you're seeing us trying to get in the software business because I want to make those decisions prior to buying the car, like upstream. But now for the buyers, they're not making mistakes. So now that perpetuates because you want to buy more and more on ACV. So 2-sided marketplaces, data becomes king.

Maybe I could ask one follow-up to that because I think we get the question a lot from investors as well. What -- when you -- where you would have less market share, let's say, outside the Northeast? What friction do you run into? Is it just education curves? Is it competition? What are the elements you're still solving for the friction you're still reducing to get to the optimized market share you want on a nationwide basis?

Sure. And for the sellers, the first friction is I've been doing business. It's the same friction we had when we first went into -- when we first went into Connecticut or Jersey or any of these markets in the Northeast, when we first went into these markets, sellers were already selling a certain way, and you're just changing their process. So if they ship their cars on Friday to the physical auction, all you're saying is, hey, let us show up on Monday and Wednesday. And really, there's no -- you don't -- you're giving us a reserve price. There's no reason why not to try ACV. And if it doesn't sell, then for the physical auction. And you all see in our data we provide, we start out getting a little bit of traction from a dealer and we grow that wallet share, right? But it's not an overnight thing. It's something where we need to start the journey. The other part with sellers and buyers that's different today is this is one of the benefits in the last year is the large dealer groups are buying more and more stores. So we grew a little faster in the last year with large dealer groups than we did with the mom-and-pop owned franchise dealers. For those of you that knew us earlier, it used to be the opposite. We were growing in the mom-and-pop franchise dealers. But as dealer groups are buying more stores, in a way, we're winning new business. just via those acquisitions. So from a seller's perspective, it's somehow getting them into the ACV mix. On the buyers, listen, in some of these markets, they might have tried one of our competitors, they might have had a bad taste. So whether they've never tried digital or they've only tried physical, it's just getting them accustomed to buying an ACV. And typically, as you all do your homework, you're going to see buyers once they get familiar with ACV, once they trust us, they tend to buy more and more on our platform.

Okay. We've got 1 minute left, George, why don't you leave us with your thoughts in terms of what you're most excited about looking out over the next sort of 12, 24 months with respect to your business?

Yes. I mean I'll answer 2 ways. One, I'm excited to stop talking about chips and COVID and all that stuff, right? So it feels like next year, we're not talking about providing any guidance next year. But it feels like, right, the -- some of the stuff is going to be behind us. I mean, we went public and all of sudden, the world kept changing around us. And I think we've weathered really, really well. But I would say what I'm most excited about is we're spending a lot of money on software even with our changes. And at the end of the day, software and data helps everyone make better decisions. And we already are miles ahead of our competitors in having better tech. And I think as our new products continue to come to market, you're just going to see our differentiation grow more and more and we'll get to see that benefit, whether that's helping on the supply side, some of the demand side, the guidance, some of the questions here and how we can help them make the right decisions. We're making a massive investment right now and I get to see some of those products come to market and we're pretty excited about that.

Okay. Well, great stuff during the fireside. Please help join me in thanking George and Bill being part of this year's conference.

All right.