Appian Corporation (APPN) Earnings Call Transcript & Summary

[Audio Gap] We're on here. But before we start, we should talk about forward-looking statements. And basically, the requirement here is that everything we say is about our expectation as of today and no other day. So I'll let you guys actually read it if you want to, but I'm very sure you're familiar with it yourselves. But thank you for coming. We've got a really exciting show for you today. We've got a lot of product information, a lot of go-to-market information. But first and most importantly, we've got Matt Calkins here to help kick us off. So I'll have Matt come up and say hi to you all.

Okay, is this on? Great. The stage is a little much. Considering the size of this room, I'm not sure the stage is necessary. But that's what we got. Okay. All right. So anyway, let me just start things off here. Thank you. Thank you for being here and for your interest in this organization. It is a pleasure to speak with you and work with you over the years. We're at an interesting point right now. As you know, we just crossed $500 million in annual revenue, a big threshold for us. We've been working on it for years, and now we're on to $1 billion. And there's a lot for us to consider as we cross one threshold, like how we're going to get to the next one. I think it's pretty straightforward. I'm going to talk you through what we're doing. I just got a few minutes here, I'll be back later for Q&A. But I want to hit some of the primary themes about how we see the next few years for us, how we see the growth and what's our edge. All right. First of all, Appian is a great innovator. And this is a moment when innovation matters. We're in a market that's changing that's growing, expectations are rising. There's a lot of hype sloshing around. There's -- we have an advantage. We've got real technology. We have happy customers. We have high renewal rates. We have a real edge. We mean to push that edge. Before I get into this, could I just get a show of hands of how -- who saw my presentation this morning? All right. Just to see how -- okay. All right, Most. most. Thank you. Okay. So I'm not going to spend too much time saying those things, but I'll remind those of you who didn't see it, just so that you can keep up with that. AI is a huge opportunity for us. AI is going to help. AI, it's -- we own several complementary technologies that make AI more valuable. I want to walk you through why that makes us a winner. There's been a lot of consternation about this over the last year, a lot of concerns about whether AI helps or disrupts our organization. I want to be super clear about this. It helps. We're in a good position to be an innovator. We love change anyway. We understand that how disruption works, right? There's a change in the environment, and then we move faster, and we get an advantage from it. nobody stays the same where they get hit by the train. We understand that. However, we're capable of moving fast, and we have assets to deploy. Specifically, we have 2 edges when it comes to AI. And AI is not a stand-alone technology. I went through this briefly this morning. You really need data, access to data and you need process in order to make the most of your AI. Specifically, in order to inform AI, you need to reach throughout your organization and process in order to make the most of your AI. Specifically, in order to inform AI, you need to reach throughout your organization and supply it with the information that is pertinent specific to you. So if you -- if a client comes to us, they want AI, we can't say, you've got everything you need, just download this application, this algorithm, we need to figure out how they can bring their data to bear on AI and get benefit from that. So our data fabric is a key advantage in the world of artificial intelligence. Our ability to put a virtual database layer across the enterprise to source information lightly without having to move it. We source information. We identify, classify, we understand what it is, and we bring it to bear at the moment the question is asked. A year ago, when we started talking about GAM, nobody knew what it was. I just spell it out, explain what GAM was. A couple of weeks ago, I'm in San Francisco, speaking at an investor conference and suddenly everybody knows. This is a very good development. I love that everybody is up on GAM -- sorry, not GAM, excuse me. Okay. All right. RAG, excuse me. Everybody knows what RAG is, request augmented generation. Everybody knows because it's the answer to a problem that everyone in AI is facing today. How do I get the value out of these algorithms without divulging my information? How do I get it while exposing a minimum data? How do I get it lightly? We have -- we were on the RAG approach from the beginning, and we are making value out of that. And while others are emulating and starting to use the language, it's getting popular, they haven't done this made work. I believe we've got a meaningful edge here, and it's due to the data fabric. The fact that we're covering the enterprise with a virtual database layer means we can source data better, we can provide the right information, and we can inform the AI queries more satisfactorily, which means we don't have to train the AI in advance. This is a dilemma that everybody is facing. How do I get value out of AI. And I think the answer is going to be, don't train it, just to inform it at the time of a question. Getting RAG right means you have to have a good data fabric. Otherwise, you're reliant on one central database, getting data fabric right depends on being willing to let data lie, wherever it happens to be out in the organization, and we are willing to let it lie. So suffice it to say, and I'll get off this technical topic now. We have an advantage in informing artificial intelligence because of our data fabric, and our RAG technology is going to be more successful than those who rely on it to address only a single data source. The other thing we're even more powerful and advantage for us is that AI is going to thrive best in a process. I'm sure you've noticed, budgets are small for AI this year, right? After last year's raging tsunami of hype, right? It might be some surprise, but organizations have not budgeted much money to try out AI in this year. Instead, they're in a wait-and-see cycle. They want it to be proven. They have some doubts, legitimate doubts with regards to AI about privacy and safety and right auditability and whatever. I mean, there's a bunch of concerns around how you can use this safely and they want to wait, they want to prove it. And so budgets are small, but this is our chance. This is the chance to put something down that works. And if you were here this morning, you saw us throw the gauntlet and say, we can implement AI in 1 month on any existing process. Our point is that we will -- our point isn't just that it's simple to put AI into an existing process, but that it's also the best place to put AI. There's a number of advantages that we, as a process vendor have over others who would introduce value through artificial intelligence. A process, first of all, is structured. It's already built in place a series of handoffs, delegations, routing decisions and it's all toward a purpose. There's all -- there's a motive behind all that. And so you've got orchestration, you've got goals. You've got a team already in place of digital workers and human workers and artificial intelligence, rules, business rules, RPA, et cetera. You've got a team that AI can join, a team, a structure, a goal, this is what you need in order to get AI rapidly valuable. And on top of everything else, you can measure the difference, because AI can be quantified in a process, you can see what it was like beforehand and it was like afterwards. So a process is a perfect place to start AI. That's what I'm trying to get to. And when we offer 1 month fixed price plug in, what we're saying is it's easy to start in a process, and it's more valuable to start in the process. So this is where AI belongs. In a year of show me, that's pretty much what 2024 is. It's a show me year. We're saying this is the easiest place to make that demonstration. Next year, we'll find out how to charge 8 figures for it. But right now, let's just do a demonstration. And be sure that we're established as being a winner in this space. So we've got meaningful advantages in artificial intelligence. Our edge in data means AI can be smarter, more informed, more valuable. Our edge in process means it's easier to start and more structured. So this is our edge. We're innovating like crazy, but we're also focused about where we can gain the advantage and those are the primary advantages that we natural structurally have that we're going to bring to bear on the market, right? So that's our edge in AI. We're also pursuing a number of new features that I think are going to be disruptive and meaningful for us. Process HQ is a big deal. We've been working on this for years. I said ever since we bought a process mining company, we've been imagining the day when we could announce that we've hit the future of process mining that because of our access to data, we can make it real time. We can be constantly aware of what's efficient and what's not, because of our access to process, we can make it actionable, so you can immediately, right, follow those recommendations and change your process, right? We've got that now. We have the ideal version of process mining that's attached to both data and process. And I think it's a leap forward in value. So that's great. We know we belong at the top of this market. That's why we released [indiscernible], the elastic scaler for processes. We mean to plant the flag hole at the top of the market. That's where we have thrived in the past, that's where we thrive in the future. Our ProcureSight website is a breakthrough. It's a demonstration of what's possible, what a frontier we're facing right now. You put data together, sorry, data, deep data, data fabric process and AI together and you've got magic. And so we've got an extraordinary offering that is going to just show what can be done, putting these technologies together. It's just the beginning we could go deeper here, we could go somewhere else. But this is a flagship offering to just say, look what's possible with an innovator at a time like this where we have an embarrassment of riches and that this is just a demonstration of what we could get after in this year. Okay. We're focusing on the most important parts of our go-to-market operation in order to be sure that we maintain excellence in the things that will define us going forward. Pricing, for example, we've made it simpler. We've made it higher. You'll probably walk through this in a few minutes, but we want to have the cleanest possible offering for the high end of the market. And so by having simplified and raised pricing, we just make it easy to move the conversation from pricing under value. We focused on uplifts from the middle of last year onward. In the past, Appian wasn't doing very good uplifts. We weren't quite matching inflation. Truth is, we're generating a lot of value. We have customers out there with wonderful consumer surpluses. We want to be sure that we're taking some of that credit back. And so our goal is to uplift at a healthy rate and get the credit that we deserve. I didn't mention partners. We're focusing on fewer partners. We had 700 partners last year. It's way too many. We need to focus on just a few of the most productive. So we've channeled our energy into the ones that make the most sense. And the same is true for our deals, right? We used to be following deals in all directions, but we know we thrive. We know where we do the best. We know where we have the highest win rate, the highest renewal rate the highest expansion rate, the highest return on our investment. It's the big deals. That's where Appian really belongs. So what we're trying to do is take the energy that Appian was spending on things other than those big deals and focus it back at the top to be sure that we get the best payoff for the energy that we spend. Now this is all meant to be just an introduction, just to sort of kick off the event. So how about I stop there and we move on to Mike Beckley, who will -- you're ready? You're ready, Mike? Okay. Okay. And then I'll be back. No, no....

[Audio Gap] And I'm going to have Malcolm Ross join me. We're going to do a tag team session here to make it a little livelier. You guys -- after lunch, sometimes, we're not fully caffeinated anymore and just get a little too settled in, maybe starting at your spreadsheets a little too much. So we want to keep it lively and explain more of the context around our features. So the point of this is not to turn you into Appian developers, the point is -- good. Here we -- is it really slow? Hey, look at that, it's me and Malcolm. So I should have said, yes, I'm the CTO and Malcolm is the Senior Vice President for Product Strategy. So 2 right people to tell you why we build things. Orchestrate change. I'll just say one thing about the marketing slogan. It's gotten a good response in my meetings from customers precisely, because it's helping them understand our place that we are not trying to -- when we say future enterprise platform, we're not saying you have to throw out the platforms you have a huge investment and you don't have to get rid of the investments they've already made. They're able to bring Appian in and quickly understand that we help them get more value from the IT investments that are always commonplace in the biggest banks and insurance companies and government agencies. And what we're trying to do is chart a vision for automation, which unifies these different sectors in a way, which delivers clear business value to the executive suite in a way that runs counter to the trends of typical IT modernization, just commoditizing different small segments. Each thing itself on its own, each feature becomes commoditized. But when you see the value of putting it all together and a CEO can understand the billions of dollars, they can save with combining an end-to-end -- combining the automation throughout an end-to-end process, that's the Appian journey we take them on. And you've seen us reflect on all the new enhancements in Appian this year. And for those of you not new to the Appian journey, this is very familiar. Those of you new to the Appian journey, I'm going to just put a little context around this. This is what Appian delivers out of the box. We give you everything you need for low-code development, AI process automation and, of course, now new in the show this week announcing Process HQ, this mission control for process mining. And so this is the foundation for everything we do. And what we have been doing for the last 25 years, automating processes, and we enhanced that with low-code years ago. And instead of just orchestrating what you have, if you need a net new process to deliver more value, you can do that easily with Appian. And now with process mining, whether you're doing the work in Appian or not, we can show the organization, where the bottlenecks are, where the limitations are. And in each of these areas, the focus is on process, on end-to-end process automation. And the Appian difference is how unified these are. These are not 3 different products that require 3 different installations and 3 different upgrade cycles. And in this climate of more budget pressures, Appian is showing much more value for that 1 purchase.

And maybe if I may expand on it, we're very excited about it, because it really represents also how Appian is very well known in the market. We have excellent brand recognition and low-code development, having really pioneered that space in our IPO in 2017. And still a strong leadership ranking from industry analysts on that. Automation, we've been a leader in for a very long time in our business process management, and we're, it's suffice to say, very bullish on the early reception of our process mining and Process HQ offering capability. So more to come on that later this year, but we look forward to a very positive reception from our industry analysts, who cover Appian specifically.

Yes, we were just actually talking to some of those industry analysts, Matt and I were. And we're making -- I think we're making a very positive impression and you see that process mining, I mean, we literally launched the product today. We're already a leader in the Gartner Magic Quadrant for process mining this year that just published, so. That was not, no?

No, that was last time.

Last time. All right. There you go. He's analyst relations over here. And so the point is we're a leader in low-code, a leader in process automation and a leader in process mining, and that's a great opportunity for us to grow now that we've got Process HQ in market. In fact, we've quantified the opportunity for you. So in the low-code space, that traditional market, we well understand the AI process automation market now, we think there's so much more to do yes, of course, the AI part of this is in pilot phase, but the agility layer need to go beyond standardizing processes and ERP, but instead now look at providing flexibility to launch new products and comply with new regulations and allow the business to respond to changing conditions like a merger, how do you combine multiple ERP systems together. This is actually what's driving a lot of our pipeline especially in sectors like -- that I see a lot like in government and Department of Defense, you look at a program like EBS-C, where we've been down selected. That's the Army's enterprise business consolidation effort. They've got multiple SAP systems. They want to put them together. And you see even the biggest integrators coming together, because the opportunity is so large. Accenture and Deloitte were standing where I'm standing this morning talking to our DoD breakfast about their cooperation on being the agility layer for all of DoD. And that's -- they're using Appian as their core workflow and interface for that because of our low-code and our process automation excellence and our scalability, of course, makes us perfect for that kind of DoD audience.

And while this obviously speaks to the target potential of our market as well, being a vendor that plays in these 3 categories, low-code, automation and analytics, process mining, there's a large market potential for really capturing a large mind share, we believe, of enterprise operations with our business operations rather than just a narrow segment.

Yes. And I think the obvious part of this is maybe to us, maybe not to all of you yet, is that by adding in process mining, we're able to make this conversation strategic about why to use Appian process and not some low-cost, commoditized workflow engine. By incorporating low-code, we're able to up level the conversation as well. We have direct access to the users and the user requirements. So it's the combination of our functionality that allows us to access these different markets and be competitive in them and better than the pure plays who try to target each one. Now AI, of course, our story here is that -- what's different about Appian AI is it's built on the foundation of process and data, process to best operationalize your AI and get leverage from it even before AI is perfect. Of course, large language models are evolving rapidly. That actually is to our advantage, because they're not great for everything yet and orchestrating and the brokering, the work between humans and AI is something that we do better than anyone. And because we make it easy for people to access AI without having to become data scientists and AI experts. Every new large language model comes with its own book level -- book length description of how to do prompt engineering for it. And when our customers choose Appian, they don't need to know any of that. We pick the models for them, we handle the prompts, they just tell us what they want. And we can upgrade those models and keep them current on whatever the best new architecture is. And so that's our advantage in process at any scale. And then, of course, the data fabric allows us to bring more of the data to the customer value here and do that without having to migrate it. There was a report from one of the big integrators saying that you're not going to see the value from AI that you expect, because ERP modernization has to happen first. And of course, their argument is they make all the money from ERP modernization. Our argument is actually you don't need to wait for that. You can use data fabric to access and tap into that while you are modernizing your ERP and start training your models and also you don't have to train the model to get the value with data fabric to get that AI. I don't know if you wanted to add anything there?

Go ahead. I think this is the big news .

Oh, yes. And of course, the strategic collaboration agreement that my team has been working on for many months, finally signed. It was a big deal to get this done and over the -- through all the approvals at Amazon to be able to announce here at the show and get the attention on this agreement we wanted to bring Amazon is incredibly excited to get more of a validation of their approach to -- in their investments in AI. They put $4 billion into Anthropic, and they're exposing that to everyone through their bedrock service, which they have worked carefully with us to help bring to market. And so that combination of Appian's trusted platform and data fabric and our ability to quickly build low-code applications is going to put AI in the hands of more users faster and help us all deliver value with AI in the enterprise. And so this is also a critical enabler in terms of distribution, being able to stand out above all of the many, many different just companies that do business with Amazon to be one of the very few that has a strategic collaboration agreement in place means that we can actually get the attention of the Amazon sales team, sales reps, Amazon architects. You'll see many of them here at the show. You can talk to them, seek them out. They seek me out. And they're very interested in helping us answer that question they get all the time, which is how do we build an app today with AI. And so that was Amazon's prime motivation to be part of this agreement. And we're thrilled to do it. It's going to really help us win more of these battles. You see a real battle happening in financial services, in government between Azure and AWS. And AWS needs app providers, app platforms like Appian to be successful, and we need them, because we're not going to try and put billions of dollars into AI, but we can access their services and make them native in our world, so that when you use an Amazon AI service, it becomes a native service in Appian, it stays all within our security perimeter, the data never leaves to go outside of a company's control. This allows us to fulfill our private AI vision, and it's a really great relationship. And here's a picture of how it works. So [indiscernible] and we can prompt them in our own ways, and we can use different LLMs from Bedrock to solve different problems. In addition to, of course, the -- our existing connector library, we have to every other LLM on the market that's made any significant impact from open AI to Azure GPT and the rest. But this is -- and even [indiscernible], the new cool hardware one. But this is so much different because you see that border there is the point is we have this model choice all within the [ Bedrock ] service and has dramatically accelerated our ability to come to market with 15 new AI skills that we're able to release in the show today. And this is how they -- all those skills break down into the platform itself. All this private AI foundation, powered by AWS Bedrock, you have a family of AI skills that developers use to incorporate into their applications to do things like generate test data to build apps faster and for end users to actually generate summarization, knowledge assistance and all the things you're familiar with and of course, the copilot for the developers to go faster.

And we think it's -- the future platforms are really going to be based on an embedded LLM as far as being able to put that idea of really understanding logic and human natural language is going to be a core part of any enterprise platform. So we're very excited about this relationship with Amazon, because it not only gives us access to offer Bedrock and exclusive relationship, I would say, inside the Appian context, as well as to fine tune that model for the specific business scenarios that our customers require, specifically around low-code development, to train it and fine tune it on the aspects of building enterprise software and Appian as well as the AI skills, which are really the automation actions that we can insert across the entire Appian platform. So very positive. You see all the vendors racing to basically get LLM inside the system. And we're very happy with this relationship with Amazon as being a very powerful and positive one that's going to enhance our customer experience.

Yes. No argument for me there. And Matt alluded to this, and we mentioned before already, so I won't belabor the point, leader in process orchestration, leader in process automation from Forrester, leader in low-code application development and of course, our focus, our business focus, we see the biggest opportunity and standing out and differentiating by being #1 in workflow automation. And with that integration use case where you need to have multiple systems where you're not able to put everything in SAP, if you're not able to put everything in your entire business in Salesforce, then Appian always has this critical advantage with our data fabric technology, and Gartner's recognized it. So that's more of our strategy to focus and double down on this to be the clear choice when you have more than one thing that needs to be combined and you need to automate that work and train your AI on it and automate it.

Yes. This came out just in October last year. And again, why we emphasized Gartner and these analysts so much is because we sell high, we sell to corporate executives who look for these independent verification of analysis of different vendor options. So it's very important for us to have that solid representation, design, automate optimization recognized by these industry analysts as well, so.

Yes, you saw a lot of -- you see that a lot in banking and finance and in the government market, especially government entities tend to be risk averse. They want to go with someone that's recognized as a leader. We see Gartner's leadership rankings as essential in product selection and in the reality, as you see a ton of Gartner's, government analysts here at the show as well, you should talk to them.

All right. So you want me to dive into the details here?

Let's dive into the details a little bit, yes.

Okay. Yes. Shall I drive?

Yes, you drive and I'll provide color commentary.

So a little bit of just a refresher for those of you who may be newer to Appian on kind of our target market focus, but with a specific focus today on product innovations that we're very excited about. A very important part of the Appian platform, of course, is our low-code design. So low-code as much today as a product management design philosophy. So it's the idea that I'm going to make my product as a platform for composition and it's easy to use by customers as possible. Very similar things like cloud. When cloud came in the late 2000s, it was the idea that I'm going to make my software as easy to access, rather than having to cumbersome installations as well as upfront purchases, you can just subscribe and go. This applies to especially software development. So how do I compose as an enterprise and build new experiences for enterprise. So low-code is a very important philosophy that goes -- underlines everything with the Appian product.

And I want to just add something here on AI. We get brought in when people want to modernize 100 applications, 120 applications. I was just talking to a government agency this morning where they've avoided modernizing applications for a long time because they didn't have confidence that they would be successful in moving that old legacy stuff into a new -- a new set of apps. But by going to a platform, they have a more comfort level that with the data fabric, they'll be able to unify the information. They won't have silos anymore. And that they'll be more successful taking all those access databases and all these old systems and bringing them over. It's the same story over and over again. But when they think about AI, AI is the assistance to do that right. But if you were to just say point AI at a legacy system and generate some new code with it, the problem you have is even if that code is semantically correct, it may not be what you need it to be. And you've then got still yet another silo. And so our vision is really simple, and it's what Annelise articulated on the main stage this morning. It's that having the low-code platform allows AI to be successful for these modernization projects. Not a generating code, but at first generating requirements and turning that natural language intent into low-code action on a governed platform. So IT is able to unify in a way they couldn't before, and AI is the accelerator.

Yes. And as Annelise said, I guess if we surveyed the audience here, if AI generates some Java code to describe a process flow, how many of you can interpret that to understand exactly what's going on? If you were to do that, you probably have experience doing software development or computer science degree. A low-code is a perfect match to generative AI, because all of us can look at that process diagram, the screenshot if it's generated by AI, understand the connectivity between the handoffs and the system. So low-code is really the perfect pairing of a generative AI solution to inform humans what's actually been generated inside the system. And of course, we focus on enterprise scale and enterprise applications. So very important to us is the ability to service those large environments, millions of users, billions of transactions and certifications. I know... Go ahead, Mike.

Yes, I go back to this for just one moment. I think some of the people mistake this to me and oh, Appian only sells to the biggest organizations. And that's not quite true. Digital transformation means even mid-market companies can sell to the world. They can have high volume. So my favorite customers are also like private equity firms and who are -- many of them use Appian. And they're systemically important pieces of the economy like the Options Clearing House Corporation, a company that's not much bigger than -- or about the same size as Appian, but is a -- uses Appian. So there are companies that do things that are valuable and a lot of companies want to sell to the world. They want to scale up. They want to go global. And Appian is the right foundation for them in that respect.

Yes. And as you heard from the presentation earlier, we continue to expand our ability to capture market in these high mission-critical business applications through our certifications. So FedRAMP High is currently in process, Canada Protected B for Canadian government, U.K. Cyber Essentials, German C5, Australian IRAP, Italian AgID, and the TISAX is specifically for automotive, digital security for the automotive industry here in the United States. So what this means is our ability to go into these markets have the confidence that we're not only proposing a software for designing automated optimizing, but also supporting those mission-critical applications fully compliant with their needs. So to elaborate a little bit more on the data fabric. We've talked about this before, but of course, it is the underpinning of many innovations in the Appian product, not only low-code design, but also our investments in artificial intelligence. As a reminder, allows us to discover enterprise data to understand how data is connected from Salesforce and NetSuite to Workday, to systems you build in Appian as well and build a unified view of that data. What actually occurs is we virtualize that data in the Appian product. So as a developer now, I don't need to worry about these integration costs on different systems. I can just work with a single enterprise composite data set to accelerate software development. Now some of the really unique innovations in the Appian product, though is our ability to then take that composite view and secure data as well as optimize that data as you interact with it. So here's a great representation again of a data fabric solution where we maybe are building a customer communication management application here in the middle, but customer communication inherently needs to be connected to my customer information, might be in Salesforce, maybe to risk and compliance information, to documents, to accounting records. Then an application today is really a composite, the data fabric really kind of makes integration of data sources much easier to build these powerful composite applications. And it's all, of course, supported inside this low-code design experience. So any user can come in here, design, define data sets, discover relationships. There's a lot of AI and automation and cyber tool that analyzes the relationships to automatically discover and recommend those as well.

And the amazing thing here is -- before you get into self-servicing insights. This allows us to have a much smoother go-to-market motion with our partners in technology. So when we go to a Guidewire, a leader in property and casualty insurance, I can have a nice friendly conversation with the CEO, even though he's got his own Jutro low-code, because he sees that we're not migrating his data out. We're not creating a new silo. We are working hand-in-hand with his goals of trying to move his customers from on-premise to the cloud. And the Appian data fabric is what makes us a far better technology partner than any other low-code. And that's true for Guidewire, it's true for [ Veeva ], it will be true for Workday, it will be true for SAP, it will be true for all the rest of these companies that we're trying to build go-to-market motions with effectively.

And this is what our customers ultimately want is they want to have that dashboard that really gives them a 360-degree view of everything in the enterprise. And they don't want to just have to move it all into Salesforce or move it on to Microsoft. Systems are always inherently going to be disconnected and siloed, but they still need to have that unified experience. So Appian is really focused on building that type of experience.

Well, when we just launched this new self-service data analytics service. So why do you need to pay for tableau seats if you can only really access one data set at a time with it effectively. When with Appian, it's bundled in to have this simple interface to do very complex, sophisticated reporting and do it against a whole host of data sets and combine them with new data elements that don't exist in any one system and not have to be waiting for DBAs to actually build you the views you want to combine claims and premiums.

One of our important patents here as well is that auto optimization layer, because just because I can connect to a data source, doesn't mean I can look at that data in a way that I want to. Oftentimes, we need to reshape that data. So for example, take just a pie chart as we see in the bottom here, a pie chart requires aggregation on specific column. If that data set is not optimized for that aggregation, oftentimes, you need to go to a DBA who then says, "Well, I'm going to create a view or an index to optimize that." What is that in the software development cycle? It's delays. The software developer has to send a request to DBA. DBA needs to create the view, maybe a week later, they get back to the software developer and then your projects in another week delayed. By having our auto optimization layer, we detect every single core interaction pattern from the design experience and automatically reshape the data behind the scenes to give an ideal performance of every single query and data set sort aggregation inside the entire data fabric. And of course, supporting this as well as our investments in our AI copilot for developers specifically first. So we introduced this on the right-hand side, which is that interface generation. So we've already started to train AI models like Bedrock how to understand the sale design system, which is the underlying kind of design system, the Appian system. From that, we can do all sorts of acceleration inside the Appian product. As we saw today, generating test data is one of those. And other very common thing here for developers is I create a unit of logic, I need to then create test scenarios to validate what happens if a user passes null or negative values or different types of date ranges. We can automatically scan logic inside the Appian system and generate the unit test coverage for that developer in an automated fashion. Same thing with generic interfaces and test data. Test data is a great area for generative AI to create mock data so they can actually simulate basically a scenario of your real data or mock data behind the scenes to validate an application design.

Yes. I mean I think we've got the most applause this morning for generating the test data.

Yes, surprising. It's like it's -- these are little things that really accelerate time.

Developers love it.

And of course, the bigger thing that we announced today also was enterprise copilot. So enterprise copilot really takes that retrieval augmented generation, that we've talked about, combines it with our knowledge repository to give that intuitive experience. So here we see an example. I thought a great one, [indiscernible] one here was I uploaded our Form 10-Ks, 10-Qs to a knowledge repository in the Appian product. And now I'd like to simply ask you questions. As you very well know, these are sometimes hundreds of pages of documents. So you're looking for a specific data element or asking for summarization of what's going on. So you can simply upload these knowledge sets inside the enterprise, you have lots of different knowledge sets. I could have my HR benefits and all sets, my financial filings, my risk and compliance information, my business operation, product management stuff. And then customers can simply ask information about it. What is this? Can you please correlate this value with this? Or can you please tell me in my benefits can I wear shorts to work? It will automatically scan and identify the dress code.

This is the use case that is most commonly what Google is bragging about doing for clients. They're going and just using Bard to do this for an enterprise and charging millions and millions and millions of dollars. And of course, to do it securely because not all these documents can be shared across the enterprise, they have to custom build that security model for each client. And why? Because they don't have the data fabric.

Exactly. The data fabric, as you can see, is so important in this evolution of this element, because we want to give an expansive view of data and content throughout the entire enterprise to make the AI even more informed inside the system. So another area of the design element we talked about in the keynote here was case management. Case management, as we shared, is a pattern of work we've probably all done before, we created a service ticket or a claim request with an insurance company, these are all units of work that need to be processed. Why we're releasing this is, again, because we've been a leader in case management for some 20 years or so, building case manager solutions for our customers. And we've learned a few things around the common patterns that customers want. And we ask ourselves, can we accelerate time to value even more? Can we create a design experience that allows even more participation in the actual development of these case manager solutions in the Appian product. So when we think about the full scope of Appian, of course, we handle process automation, process case management. But many times, we're handling the very complex things in the very far left, the mission-critical applications Appian has always been well suited to. But we want to be a platform for process across the entire enterprise. There's no reason we can't handle those long tail, we say, of process opportunities as well. So by bundling case management studio and those advanced and premium tiers of the Appian product, we can really be an enterprise platform for all process needs across the entire enterprise.

Yes. I mean that's just it. This is -- Appian has not really targeted citizen developers before. And it's because our strengths and scale and complexity play better at the high end. But case management studio fills in this need and makes us a truly enterprise-wide platform. If you go to the next slide, I think you make this point more clearly now when the business makes a decision to standardize on Appian as their enterprise platform, now they can truly say every user community has a representation. And more to the point, what's different here is it's IT governing the citizen development. IT runs the case management studio. IT sets the standards. IT ensures that because they're using Appian, they're not creating 1,000 different silos. The case management is built directly on that shared data foundation. So everyone's on the same page, you're still unified even though people have the flexibility. This fills in the need where I see, for example, engineering, IT is going to build the onboarding for a bank. They're going to build the onboarding for a financial institution, but they're not going to be able to keep up with every regulatory change in every new product. That's the reality I see whenever I talk to all of you on the onboarding side. And so now case management studio means IT can delegate those changes of just adding a new onboarding task to an existing IT harness.

And these work together. It's not system development hey, that can be integrated low-code developer, the low-code developer can create a case type that is now available to the case management studio as well. So they complement each other for a full life cycle. And as Mike shared, a full governance model on top of the entire life cycle development. So I was going to give you a quick taste, if you all like to see. But instead of risking a PowerPoint failure, we'll just do it live this time to give you a...

Yes, go live.

So 2 main things, I guess. Again, a quick taste of case management studio is a package interface for case workers. So casework is a common task that many of our customers use. You have an inbox, you have types of cases, submitting cases. So we've done a lot of UX design here to optimize the view based on our experience, giving an aggregate view, a calendar view on the right-hand side of key due dates, tracking also the deadline completion. So often cases have service level agreements I need to meet. So I have real-time tracking exactly where I stand. And then of course, a variety of critical cases I need to address right here on the top. Now aside from the case dashboard, of course, I can drill in, but there's also a really great report dashboards as well. This brings forward not only the ability to track all the case information across the entire system across all the different systems, but as well as customize these and customize the view by using that data fabric analytics and insights to create bespoke reports for that specific user. So just time permitting, I do want to give you a quick taste, we'll do more longer demos, and there's lots of material also on the Appian website on this. But switching over to you to automation, of course.

We got a lot to wrap up.

Yes. So automation -- our vision of automation, as we've shared, is really about having an expansive view of automation. We're not trying to do individual automations, but that is a critical part, like RPA and AI and business rules. But we look at it holistically. We look at a customer and say, you don't just want to solve a one test, but you want to understand how it could automate end-to-end processes to accelerate outcomes. And that's why it starts with kind of the process modeler that integrates in the AI, RPA and other areas. Speaking of RPA, we made that acquisition several years ago. We've really focused on simplifying experience and integrating seamlessly. And over the past couple of years, you've seen fantastic adoption of the RPA capabilities. All really supported by the seamless integration of RPA as a design component, encourages adoption by our customers, and it's really accelerated adoption as we've seen.

Yes. And we're starting to see a real customer interest in replacing UiPath installations and saving millions of dollars by adopting Appian RPA finally, now that we're reaching a real maturity level in our capability and how well integrated it is in Appian, as well, we just announced, RPA is now available for our self-managed customers. That's huge for our federal and DoD clients. So when you're talking about an installation in cArmy, the Army Cloud or Cloud One for the Air Force, now they're able to take up the Appian RPA. And again, that also further insulates us from any attempts by RPA vendors to try to move up market.

And we just heard from customers like Fannie Mae adopting Appian RPA across their whole [indiscernible] as well. Yes. And of course, repeat this again, it's very important for us. The [ product wide ] to enable AI is in the context of your data and process. But how do we actually do that? We talked about AI -- enterprise copilot. But another key outcome here is the AI skills designer. This is the idea that we're going to apply low-code design to then training custom models inside the system. So again, it's intuitive, it's approachable by business users to quickly say which scenario they want to do. I want to identify PII data, I want to classify e-mails, extract content and then have a simple intuitive walk-through experience with that. Now because we're greatly expanding this last year, we only had the top 3 document classification, document extraction and e-mail classification. As you can see, we just added a dozen now in the past quarter. So great acceleration as far as the variety of AI skills. And then we feel really confident about this because many customers think, AI, they don't know where to start. By having AI models tuned to specific use cases, makes it very intuitive for customers to say, that's what I need to do. Go ahead, Mike.

Yes. And the more important thing I see is, again, go-to-market motion for our business partners, all the solution builders, the Accentures, the Deloittes of the world now have a strong incentive to use Appian's AI builder here, the skill builder, as part of all their solutions. So you get a budgeting solution. Now there's no reason why they shouldn't have an AI-specific solution for looking up the right budgeting information.

Yes, exactly. I'll let you talk to this one, very near to your heart. Yes.

Well, I think Matt covered [ Epic's ] pretty well. The only thing I want to add here again is this is critical at handling new opportunities. I was talking to a major bank from Australia this morning, about their need for straight-through processing. Previously, we would have been a little reluctant to tackle it. Now it's an obvious natural fit for us. And ETL use cases, Internet of Things, digital twin use cases, manufacturing sector, predictive maintenance use cases, there's now a whole new set of value we can deliver. And when people choose us as an enterprise standard, they can use us for everything and have no fear that they might need to go pick up a Camunda for some edge case. We can now scale better than anyone and for every type of use case and put them all together, so they have one process standard. And it's fully low-code, unlike Camunda or some of these other hyperscaler workflow tools. All right. And optimization, Process HQ, our final minute, let's...

So I mean what's really different here is, of course, we're kind of I would say, revolutionizing process mining by first integrating it very tightly into that full automation suite. So it's not so easy to gain insights and then turn that into action side of the system.

I would have said, we were punching Celonis in the nose.

So you can't punch them if they don't have a nose, because they don't have RPA. They don't have these other things, right?

Exactly. The more to the point, they don't have data fabric. So the biggest cost complexity and risk with the Celonis project that we see or hear about from, is that it takes a lot of time and effort and upfront consulting. And so with the data fabric, we're able to take a big bite out of that.

But of course, it's not just process mining. It's also data fabric insights as well. So it's our ability to take that entire data fabric and then do just general BI on it. Now what's always been wrong with BI in the past is, first, those licenses to Tableau and Power BI are often costly and isolated to specific people. There's analysts who need to do data analysis. Another challenge with data warehouses is oftentimes when I move data from a source of truth like Salesforce or NetSuite, I drop security when I move into a data warehouse. By using our integrated approach to data and then overlaying also the [indiscernible] security on top of that real-time always ready data, we can really kind of give a BI data fabric insights experience to every single license user of Appian. So it allows our customers to start to expand access of data insights while confidently knowing, they're not going to pay every single time for every time a user wants to gain access as well as they can have confidence they don't see data they shouldn't because the security is always in place as well. So very transformative. We look forward, too, on this. Yes. So it's mainly defined in these 2 functional areas. And of course, data fabric insights combines a general BI experience, building dashboards based on composite data sets like from a data warehouse, but using our data fabric instead. But as you see from the right-hand side, we're also overlaying the AI copilot. So I can ask questions, insights from it, even have it may be write summary e-mails and do the other kind of content analysis upon it. Another big innovation that we showed off here was also predictive [ coding ] based on some AI algorithms as well. So you can see at the very top here, it's kind of a type ahead where I start typing what I want, like I want the count of this. And it's trying to predict exactly what object I want from the entire data fabric. So if I say count of, okay, what do you want, opportunities, accounts, things like this, and it gives me a type-ahead experience to try to predict what I want. And as I write that in a more natural way, it automatically and builds the report for me on the fly while I'm doing it, a very cool feature that makes, again, data reporting more approachable to every single user. And of course, process insights has the command console for basically visualizing mine process. On the very bottom, we see what we typically call the spaghetti diagram. You might model a process in the Appian process model, but it's not necessarily the way it works, because sometimes they have process steps that go outside of the Appian product. Sometimes they just work around, do things at different times as well. So this allows me to really analyze how a process actually works in enterprise, visualize it, identify bottlenecks and track those things so that I can create insights and actions upon them. So we also have these executive dashboards, allowed them to identify those key statistics. On that last tab there, we have the investigations. So as I identify things, I can say, well, this seems to be an issue, the AI inside Appian identified this anomaly. I can create an investigation out of it and then have it turn into a recommendation for a robotic process automation to accelerate the time or rerouting to that process to another step as well.

There's tools in here for the actual mining, but there's also dashboards here for the executives. So at a suite level, they can see the business case for your automation initiatives. They can actually see what they're saving with process mining. They can actually be able to sit on an earnings call and say we saved $1 billion with Appian, because they've got the data that proves it here, exactly how they improve their processes, how they improve that orchestration and how it didn't just push more work downstream. They actually know end-to-end that they got real business value by optimizing different steps in that process journey regardless of where the work was, in Appian or outside of Appian. Yes. So we don't have time [indiscernible].

Yes. We'll skip through the solutions very quickly as well. We've heard also we have our platform go-to-market. There's also a huge opportunity here at Appian World. We had a GAM Summit as well. As a reminder, the U.S. government spends a lot of money as well as there's hundreds of thousands of professional procurement officers across the entire United States government, who's our target for this specific market. So 190,000-plus U.S. government procurement officials. I believe that's just a federal government outside of different states and large municipalities. And we attack this market with a complete suite solution. So it's centered on our contract writing capabilities, but takes you through requirements management, cost automation, vendor source selection, award management, procurement analytics to really be a complete platform for GAM inside the system. And of course, one of the great tools we just launched here is our ProcureSight offering. You can go to it today, procuresight.com, just launched yesterday. And it's specifically again, a free service, which is going to accelerate the search and accelerate the production of new procurements. We hope to use this tool to really draw those government procurement of professionals into the Appian ecosystem with a free service, while also being able to position the full GAM suite as a larger upsell as well.

And of course, there's the opportunity in the future to expand, and we sell that service too.

Exactly. And then on the insurance -- go ahead.

Yes, the whole contractor community will end up wanting this.

Exactly. It's -- we're very bullish on this as well. I'm very excited about the launch and tracking it very closely. On the insurance market software, again, insurance companies also spend a large amount of money. We have relevance in many areas of insurance systems, from business intelligence that we saw such as process insights, to core system operations and orchestration and application solution development. But why we're really bullish about this is, first, those packaged solutions, connected underwriting, connected claims, which have very targeted solution delivery on meaningful outcomes for our customers, but more importantly, the business partners. If you want to talk to this, [indiscernible].

I mentioned it already.

Okay. The Guidewire, of course, is a critical business partner for us, with the connected systems to their data sets. And also Swiss Re is representing the Appian product in our connected underwriting life workbench solution as well. So these accredited vendors who have relevance in the insurance industry are giving us the extra backing and insurance.

Yes, this is real co-selling, this real joint go-to-market motions, real lead sharing, like these are really deep partnerships.

Yes. But I know we're way over time. So we'll get wrap it up there. So, thank you.

I don't need a clicker, but I'll hand it off. I'm going to give it to Mike. All right. That was terrific and you kind of showed off a lot of really cool features. Next, let me introduce please, Mike Mayer, our Executive Vice President, Enterprise Sales. I've had the pleasure of working with Mike recently. I want to introduce him to you. He's got a lot of great ideas, tremendous credibility. And well, he's going to tell you all about our go-to-market approach.

All right. Thank you, Matt. And good afternoon, everybody. I'm Mike Mayer. And as Matt said, I'm going to talk a little bit about our sales strategy as part of the larger go-to-market strategy. I think we've just got to get the slides flipped. Here we go. Perfect. Wrong clicker. Thank you. All right. Perfect. There we go. So in 2024, what we're doing is bringing our sales teams together around really a simple formula, and I think a pretty motivating vision, right? Our intent is to deliberately focus upmarket. When we do, we get bigger deals, we work with more senior buyers. We get a better fair exchange of value for Appian. And as Matt said earlier, we thrive at that high end. We have for years. And so that's where we're going to focus our energy. In 2023, this is where that exciting vision kind of comes in, we exceeded $0.5 billion in revenue for the first time in the lifetime of our company. And so now we've got sales excited about that path from $0.5 billion in revenue to $1 billion and beyond. So our simple formula, a simple sales formula to get there is to aim high in the market and in our accounts. All right? It's to land where we know that we can expand and then to take advantage of that expansion. We're going to expand our customer base. It's to focus on productive partnerships. If you heard our talk this morning, you've heard that we focus on the partners that are investing in us. We invest in the partners that are investing in us. And we'll ensure that we're easy to work with for customers and for partners. Appian is the right technology. We are the right platform and solution for the mission-critical challenges that our customers face. And so we want to be the easy choice as well. So let's talk about aiming high. It's the first part of our formula. And the largest part of our TAM, 70% to 80% of it is actually in the enterprise segment. So we've organized our sales teams around the enterprise segment. We're taking on the high complexity challenges, et cetera, from other inbound leads as well, but we're focused on making sure that we're proactively going after that enterprise segment. And unsurprisingly, the largest projects that we do, the largest impact that we have is at the CXO level. It's when we have CXOs sponsorship. That's where we have the best customer return on investment. That's where we see the most people in our customers using Appian. It's the most valued Appian. We positioned our sales teams and we continue to make investments in this way to be able to have the right CXO conversations. We've organized them by industry, public sector, you see a lot of that here, financial services, insurance, health care and life sciences as well as manufacturing and supply chain. And further, we're arming our sales teams with scaled value engineering content, so that the industry conversations they're having are in the value language of the CXO. It's at that intersection, right? The enterprise CXO level, where we have that massive impact. So I want to give you one example. And this is a great example of a land customer. We landed one of the biggest medical device manufacturers in the world, because we have the right level of executive sponsorship on a pretty complex opportunity, right? We worked with the CIO, the CTO and the Chief Medical Officer at this customer to really attack a patient level of care opportunity and to help them differentiate from their competition. The Appian team, working with one of our partners was able to drive 75% of time out of the delivery of surgical and implant kits to patients, right? We were directly able to improve their ability to serve patients in the marketplace. When we land deals like this, we know that we can expand them. So let's talk a little bit about expansion. I'll give you another example. When we land high in the account, in the market, we land accounts that expand with Appian. Our enterprise installed base is an incredibly valuable asset to us. And so in order to drive expansion, what we're doing is really digging into our customers' evolving priorities, making sure we're aligned in a way that allows us to understand them and position ourselves to capture some of that opportunity. So we've aligned our sales teams with their customer success counterparts to make sure that what we can do is capture those highest propensity customers. And when we do align that way, we expand big as a result. In fact, on average, when we've landed in these enterprise accounts this way, we see our customers grow 5x over a period of 5 years, pretty massive opportunity. So I'll give another quick example, up here on the slide. A large global auto manufacturer. They were looking there in a hotly contested market. We know what it looks like, highly competitive. They're an existing customer, and they worked with their Appian team to transform their operating model. And so this customer had massive business goals. A big piece of the puzzle was actually optimizing the Appian supply chain, optimizing the supply chain. And they looked at Appian since we were already in there, right? We had the credibility having delivered a successful project before, and we spoke the language of manufacturing and supply chain. We were chosen to help them drive out huge costs from their supply chain operations. And we took out $27 million in savings, right, by driving supply chain optimization. This, for this customer, this was 7x growth with Appian over that same period that I mentioned in 5 years. So pretty massive. Both of these examples that I just provided, they were in partnership with what we call our focus partners. These partners, they help us to identify and to capture the industry challenges that the Appian platform is so uniquely suited for. This year, we've taken some pretty big steps, I think, to ensure that our selling teams and our partners complement each other at every opportunity that we have. So what we've done is actually reduced our ecosystem by half. What this allows us to do is focus our investments on those highly aligned partners. As I said, we invest in those partners that invest in us. And in these partners, we actually have corporate level agreements and commitments for growth. So we've also invested in enabling these partners. They're focused on us. We want to make sure that they're as expert in Appian as we are, that we learn all that industry context from them. And so we've released new presales and sales accreditations on top of the train the trainer programs that we have and our accelerated certification programs for technical resources to drive really true 360-degree enablement. And finally, partners are utilizing Appian to monetize their IP. We continue to see them expanding our solutions. We continue to see them building their own solutions on the platform. And in fact, today, I think we're going to hear from KPMG, who is our transformation award winner this year. What they're doing is baking our AI capability into their existing Appian solutions. So we're seeing that uptake. And really recognition of our place in the market, that practical capability of AI. And this overall focus to me, what it's also allowing us to do is be easy to work with, right? We want to meet the customer in the way that they want to transact with us. So before I turn it over to Randy, I thought I'd close just sharing that I truly believe we are putting ourselves in a position to be much, much easier to work with. We've released and we continue to release package services like our starter kits that include licenses and services to help customers see value even faster with Appian. You heard Matt talk on stage about our AI kick start offering. This extends beyond just that new logo, right? We're also leveraging these packaged starter kits to help existing Appian customers get started with new and transformational capabilities like our AI technology. And we've dramatically simplified our pricing. Customers need to solve those mission-critical challenges. That's what mission-critical means, that's where we've been uniquely aligned over the years, right? But they want predictability around what it's going to cost them, right? What it's going to take to operate that over the years. So we know these changes will help us keep our customers growing. We know these changes will help us land more of the great customers that Randy's pushing towards us. And so with that, I'll turn it over to Randy for the rest of our go-to-market strategy. Thank you.

Thank you. Good afternoon, everyone. I am Randy Guard. Pleasure to be here with you and happy to -- oh, it's moving magically. Would you be able to take it to the slides? Let's start with the TAM. Here's a good starting point. This is one of our rehearsed in the mirror dozens of times. So thank you in the back. You saw this slide earlier, I think when Malcolm presented it. So I'll call your attention to 2 real key points there. One, if you look at the $60 billion, that's a platform-centric number from some of the analyst firms here and how we look at it, right? A good size number, doesn't even include all of those industry and application markets. So that's additive to it. The 31% CAGR our friends at IDC called out because as they look at intelligent process automation, they look at that and they see that where AI is embedded in it. So over the course of 4 to 5 years, AI isn't a stand-alone market, it's embedded into this intelligent process automation. And that's a really nice growth rate. And the reason I call on that is our corporate message, our essence of what we bring to the market and then we start to drive in many different ways, is fundamentally that AI is embedded. AI does not stand alone. You said this morning, Matt, and you've said it before. AI is not stand-alone when we look at enterprise AI. It may be when you and I are in a chat and trying to figure something out or doing some search. That's not enterprise AI. We're talking about agencies, corporations, global entities, who want to be able to leverage the data in their enterprise. Each one of these has dependencies on each other. AI needs data for fuel, right? The more you give it, the more it's going to give you back. So some say it can be smarter. Some say it can give you more answers. So you could be smarter. We could debate that. But the bottom line is AI needs that fuel. And when you're doing enterprise AI, you want to know and trust that it's your enterprise data. Process, AI needs context. And we like to say and describe the concept of operationalizing AI. That's how you take it, make it defined, repeatable, delivering ROI efficiency and value. Experimentation is excellent for discovery. Operationalizing AI is how you drive business efficiency and top line growth. AI needs process for context. And we fundamentally and uniquely are capable of providing this these 3 together. That's why we are committed to an enterprise AI go-to-market. Our other promise, and you heard quite a bit of this with Malcolm and Mike as they talked about capability, it's private AI. Data fabric, data fabric and data fabric. So you got to think about the unique capability that, that offering provides our customers. They can trust what AI embedded in their process is delivering to them. They don't have that doubt. They don't have that concern. And as we've seen many companies have had to pull the plug on some AI initiatives because they just didn't know. Here, they know and they can move forward. Some topics more to just give you some ideas. I know Mike touched on this a bit, and even Mike Beckley did and Mike Mayer did. We talk about segment. So think of this, we can think of it as size and industry and geo and vertical. But first, think of it as mission-critical processes. Yes, the enterprise and those large public sector agencies are absolutely a sweet spot for us. We've seen it in the past. We see it today, and we'll see it tomorrow. You've seen it on stage here if you were able to see some of the keynotes or even the breakouts. There are also organizations there that, as Mike Beckley mentioned, that midsized organization but their processes are complex. An example of something like that, if you saw the Axiom presentation today, Axiom Space, right, an organization that is basically revolutionizing the way we leverage human space exploration. They work very closely with NASA. They work very closely with manufacturing organizations around the world in order to deliver on their promise. There was a visual the team showed there where they connected systems of finance, inventory planning and design. They're building a space station in a space suit, and Appian is that thread across, not only their business, but other manufacturers as they're putting this together. And at the very end, you saw where they've embedded in they're running with our product strategy team to bring chat and enterprise AI into the business. They called it the bubble man, the bubble diagram. So it's pretty cool. But when you look and you see what the mission that they are delivering on, you see that, yes, it's cool. It's great that they're doing that, but they're building a life support system for a human to walk on the moon. So it's a pretty powerful stuff. I'd also like to talk briefly about Bayer Group. And Mike mentioned this as we go from CXO relevance and he had great numbers and great information because absolutely, we want to embrace the CXOs. Again, I'll use an example. We had our -- the Deputy CEO from the U.S. Army on stage. She talked earlier about all of the initiatives that they're putting out from the U.S. Army. And there were some stats here, and I know from our GAM suite, they're early and continued users of that. The Axiom Space team started with the CTO, had the Director who implements and own [ Brandon ] and their developer who was our keynote at Developer Days. We had the Bayer Group on stage for 30 minutes talking about how Appian and is critical to their business. Those are the types of use cases and validation points that one, I want to make sure you see and you know and if you see these folks out here, they'd love to talk with you as well. One of the hows that we're putting a very conscious effort into, a how of how do we take that to market, how do we target those clients that you heard Mike talking about? How do we target the new logos that we add to our portfolio is with consistency. And I know that's not rocket science. And I know that's not magical, but it is super critical as we drive efficiency in our go-to-market execution and continue to grow ARR for the business. Awareness, just a point-in-time example. This conference has 29% more registrations than we did a year ago. Last year's was great. I wasn't here before, I hear fantastic things about San Diego. What I know is we had 29% more folks attending here. We have 400 partners in registration. Mike and I spoke with him on Monday, we had a packed room upstairs. More came today than even at the Partner Summit. So that's a key component to our strategy as well and a big part of how we drive domain or drive demand. So currently, we see double-digit growth in our pipeline build, and that's a number of opportunities in those target segments as well as that dollar value. And we're super focused on how does that dollar value of the client and the customer grow. You've seen offerings where we're committed to land and grow, but we're going to land, as Mike said, in the right account, because the growth is there. Fannie Mae talked today about, they started with an Appian guarantee, 8 weeks guaranteed production application. They're now on their third or fourth application with Appian, and couldn't be more thrilled about doing more. That's the type of a growth scenario that we look for and we love to celebrate. I'll talk a bit about validation in a moment. The 3 campaigns that -- or the 3 sets of campaigns we put out. First one is brand and awareness. We want to continually and continually and continually increase the awareness of Appian and the capability we deliver. We will do that with what we say and do. That's a big part of my job, and that's why I'm here as a head of marketing. We're also going to leverage our customers and partners to do that. We want them to be the faces of confidence to say, I'm running Fannie Mae or I'm sending people to a Space Station or I'm driving the procurement for the U.S. Army by using Appian. Those are the validation points that really drive, in this case, vertical segments and/or horizontal geographies. And we've talked about some of the growth in public sector. Obviously, the U.S. is strong. In Europe and the team in U.K., for example, a big initiative there as well. I talked a bit about the IT group in the middle. We will and we have to address each of those 3 layers of personas. From the executive level, the VP, the Director and the developer. Mike mentioned this, any CIO or CTO making a big commitment to an application and a platform like Appian wants to know also, what's my total cost, how do I get the skills and capabilities to continue to grow on the Appian platform? We want a vibrant and strong community of Appian developers, Appian practitioners out there. In addition to all the cool stuff, and if you were in the audit, you heard the developers are roaring and we were showing them some cool developer copilot pieces. We want that community to be just absolutely excited about what they've got and building their resumes. You've seen the branding. This is for us -- the reason I put this up here is we're embracing change. And at one point, we said, wow, that's a little bit of an edgy word to feel comfortable about. But the reality is our customers are changing and they need somebody to help them. We want to bring the confidence. We want to know and we want them to know that we can actually solve the problems with them. On Monday, in the Government Acquisition Summit, the folks from the Public Safety Department of Texas. We've got a case study and we'd love you to see it. They were up on stage talking about it, Michael Parks and Jasman Robinson, we're describing what they're doing and how they're doing it, and they basically have something called Ask Mike. Michael Parks is the Director of Procurement for Texas, $3.2 billion in procurement. So there's a lot going through there. I think he used to get a lot of phone calls, e-mails and text. They created this enterprise chat and through Appian. They call it, Ask Mike. Basically, they are driving, and they finished. I didn't prompt them nor comp them. They said, "This is how we orchestrate change in Texas." And it was kind of cool they're comfortable with change, and they feel it, and we are, too. So we're looking for those businesses we want to lead and innovate in the market. We have quite a few from an industry perspective, you've seen the solutions that we have earlier also from our partners and our professional services teams domain expertise to deliver on these types of use cases. We do define it. These are boxes, if you will, of areas where we know we have expertise. If we're working with life sciences and its pharmacovigilant, we've done projects and we have work there, we have capability. There will be new ones of these for sure, because we're not only doing the ones in the box, but it's super important from our standpoint that when we know and we go in and work with clients, we can help them do this repeatedly and we've got a partner network out there to help us as well. I'll end on one other slide, but I wanted to share this because there's an essence here from Appian that from our standpoint, our size, the way that we're run, we're founder-led, we believe fundamentally, we can engage a customer and build a relationship different than anyone else. Anyone else that's a mega client that, yes, I know you're on a spreadsheet or a list somewhere as a customer. But we've got programs in place. Some of these are new this year and some have been running that we want to embrace those clients. Appian Studio is our way of working very closely with the client, and we literally just showed today from TELUS, a $15 billion, $14.9 billion telecommunications provider. We showed that output. It was a 4-minute video that we showed in front of the keynote today, and the team is actually 3 doors down speaking with the group, but that is their story. That is their story of how they've embraced change, that is their story, how they're driving millions and saving millions in their business and actually repurposing that to other uses. 360 engagement is a way we as across departments, across our businesses, normal things you would want us to do, but we're doing. It's top of mind and a focus for us on how we engage that group of clients that really fit and they're also the leaders in their industry, right? And they're out there. When we're not in the room, they're talking about Appian and the value that we can deliver them. And I know Mike's super keen on the innovation briefings as well. That's something we've continually stepped up. We obviously have these kind of conferences. We'll have Appian Europe again later in the year and Appian Government later in the year. We're doing something new called Around the world, Appian Around the World. We'll be in 8 to 10 different cities in major metropolitan areas, North America and Europe. And that's another way where we show our innovation, and that innovation also comes in the way of product and technology that you saw earlier, but it also comes from our clients talking about the business. What have they done differently to really make a substantial change in growth, not just incremental change, which can be helpful and can be important and can be necessary, but those ones making the big incremental changes are the ones that you're seeing around here. And I think I picked 2. I got to introduce Axiom Space. Super excited about that. And yes, I was a little bit biased there. But their story is pretty cool on what they're doing and how they're implementing it. I talked a bit about it. So I encourage you to go check it out. We're happy to share with you if you haven't seen it. You can see some of the work they're doing, but they're connecting again, all the design inventory supply chain solutions as they build out, one, the new space Nation; two, they take people to the current international space station; and three, they're building the new space suits for the Artemis astronauts. So they got a few big projects on their docket. Novartis is presenting, Fannie Mae presented, U.S. Army presented. So clients across all different industries, mission-critical processes that span the enterprise and a good portion of them are probably already showing how they, too, are embracing what you saw earlier from me with data process and AI. We fundamentally believe that's not just a marketing message, it's how companies can go and answer this question of, where do I start with generative AI? Where do I start to make a difference? So thank you very much. Mark or [ Regan ], I don't know who's going to take over here, but appreciate your time.

Thanks, Randy. Well, awesome. Today, I'm going to talk about some of the themes around our financial profile and our financial growth or performance. We'll get into some details. For those of you that don't know me, I'm the CFO at Appian, Mark Matheos, I have been here for about 7.5 years. It's one of the best places I have ever worked. And I love the story. I love the founder-led culture, but I'm here to talk about the numbers. So let's talk about the numbers. . So we have a really strong growth profile. I think everyone knows about our kind of subscription model and the margins that are in there, but we'll dive in a little deeper on that. A very predictable business model, really strong renewal rates. My favorite of the highlights here is the customer unit economic stuff. So we'll talk about kind of the lifetime value and some of the amazing things that the data is telling us on that front. And then finally, we'll talk about how we're investing for sustainable growth over time, kind of what are the long-term levers that we're going to pull. But let's get into it, we'll talk about cloud first, right? Cloud is kind of the pulse of our business. It's the most important metric that we guide to. It's nice and clean, too, because it's completely ratable. It doesn't include any of our on-premises software revenue, which is, of course, a little lumpier, not just in the selling motion, but also insofar as ASC 606 requires us to do upfront revenue recognition. So this is kind of like our pure ratable growth rate. And cloud is where we want our customers to be. It's a large majority of our bookings. So it really is representative of the pulse of our business, 34% CAGR over time. So when you include kind of all the other types of subscriptions, maintenance, on-prem, and we've kind of switched to a view of ARR here, it's a little bit of a subdued growth rate, but still strong at 26% over this time period. But interestingly, when you start slicing up the data and you look at ARR, for example, for top 50 customers, the growth rate doubles, right? And so that's kind of something that I think you've heard today over and over again. It's kind of a theme, right? Go big. If you're going to buy Appian, go big because you get more impact, you get more ROI, and we see that you actually get more expansion. If you're on our side of the table, we love it. So this is going to be one of -- a couple of different kind of slides that paint that picture for us. If you look at our customer count, and stratify it across deal sizes, all of these deal sizes are impressive. But the largest one the 1 million and up. I mean that, we're growing our customer count the fastest in that. And that's not by accident, right? So next slide. We've kind of gotten the picture over time that bigger lands on new logos are the name of the game. We've seen a 90% growth in that over this time period, but I actually think we're just getting started. We're going to keep doing this. Trying to get that bigger land, because the data really shows that it leads to better outcomes for us and for the customer. When we land bigger, we get in front of the CIO or some executive, we get on the road map, we're not quiet about what we do. And sure it might be like a smitch more effort upfront, but really the payoff comes in spades. So turning a little bit over to gross margins. As you know, we have a platform strategy, our margins on the subscriptions are, I would say, elite, 89%, 90%, and that's blended cloud and on-prem. We're very consistent in that. If you go back forever and ever, it's going to be 89% to 90%, and it's something that's kind of like a hallmark of our margin profile. If you look at the -- I guess it's like a shade of blue, there's lots of blues on this slide, but the lower shade of blue is our total revenue margin, right? And over time, it's been ticking up, with 65% in 2019. It's now notably higher at 75%. And it's kind of approaching our target model, which is in low 80s. And we're seeing that happen primarily because of the mix shift that's happening. So we're selling software. It's growing a lot faster than services. Services is about upper 20s to 30% margin. And so over time, we've become more and more software focused in terms of total revenue. And you can see that here. In terms of our kind of IPO timeframe, which we often use as a kind of milestone date of where we've come -- how far we've come since, we were around 50-50 at IPO. We're 80-20 now, and I don't think that's it, right? We're going to keep going. It's going to become over time, 90-something. And so it's the mandate, right, to grow revenue a lot faster than services. We're certainly focused on services is a critical part of our revenue stream, but not necessarily as part of our growth strategy. So looking at NRR, this is another key metric for Appian. We like to save 110 to 120 is our sweet spot. The reality is we've been on the north side of that, right? We've been closer to 120. We've seen kind of that expansion motion drive about 20%. And then the darker blue again is 98%, 99% GRR which is also elite. And this speaks to a lot of things, right? One is the mission criticality of our software. If we got a GRR that high, chances are, we're doing something good, and we're pretty sticky. And of course, our expansion motion is healthier because of those larger lands and because of the expansion into different applications. A lot of people ask, how do you expand? Is it seats? Is it something else? Is it usage? For us, it's really applications. So customers buy Appian and they buy 1 application, they launch it. And they get an ROI pretty quickly, and they understand that works, and then they start building more and more applications. So every application represents an upsell for us. And so that's how we radiate within our customers. One of the nice things about that is you can have a person that's on in a company, let's say, a person that were set a bank. And a per-user model, once they're a user, you're done with that person. But in an application model, you can kind of multiply their usage, right, across different applications. So at a bank, somebody could have a mortgage origination app user, somebody can have a know your customer user and it can be the same person. So it's really about what you're using Appian for. And some of our customers have dozens and dozens of applications with us. Our most prolific customers have upwards of 100. The cohort slide, maybe my most favorite slide, you guys have probably seen it before, but it shows here about 12 years of customer cohort growth. And if there's something that paints the picture of longevity and durability of revenue, what I like to call high-quality revenue, it's this. Our customers stick around, they expand. So natural conclusion, keep trying to get new customers, right? Keep trying to add to this layering of our ARR, so we can get the company to be as large as we can be, knowing that the expansion motion is real, and it's really strong. And the lifetime value is what results, right? We have multiple years of growth -- our LTV on our customers are -- is really, really high. It's like in the millions and millions of dollars. And so that drives LTV-to-CAC really, really high, well north of 7%. So another way to look at this is every dollar we would spend acquiring a customer where we get $7 or more in revenue. And another reason to balance out investments and profit. We still feel compelled to add to our customer list, add to our use cases and try to get more market share. Turning to sales rep productivity briefly. We've got pretty simple calculation here. It's net new ACV divided by the number of reps. Sales rep productivity is a priority for us. We've been focused on enablement and training. And we've -- over this time period, we've seen about a 40% growth in sales rep productivity across that metric. I think that's something we're going to continue to focus on and hopefully, we can extract a lot of output from our existing sales force far beyond what we have today through the enhancement of this productivity. And Mr. Mayer over there is focused on this. This is his metric. So I'm sure it will go up. So one of the metrics that I'm focused on is adjusted EBITDA. When I took over in 2022 as CFO, we got a pretty notable adjusted EBITDA loss. And since then, we've put in place multiple measures. I call it growth of scrutiny medical that as well. And it's really kind of a new posture on OpEx, where we want to rationalize our spend and make sure we're getting the ROI we need for our dollars. So we've done a little bit of a kind of an audit, if you will, our P&L. We've taken out initiatives that don't work. We've cut software, internal use software that doesn't really work or nobody is really taking advantage of. We've looked at underperforming areas that we want to stop investing in. And very importantly, we've also metered our hiring to make sure it doesn't grow as fast as revenue. And the result of that is this trajectory that's been building, right? We have 16% that then becomes 8% in 2023. It's a having of our adjusted EBITDA loss margin. In 2024, we'll see that happen again or better. And if you want to imagine 2025, we've said it will be profitable. So it will be north of the horizon. And we're going to follow this trajectory, I guess, in this case, since you look at it this way, up above the horizon in future years. So the era of losses is going to be behind us. So -- how are we going to get the long-term growth? Revisiting our algorithm real quick. We've got kind of 2 ways we grow, right? We've got upselling and new customer growth. Upsells are about 2/3 of our revenue growth, 1/3 comes from new customers. But what feeds that in the long term are these levers that we're going to pull. And we've talked about a lot of them, right, strategic partnerships. You're going to have a partner panel later this afternoon that you'll be able to ask questions and understand more about what we're doing there. We also have emphasis on solutions. We've kind of talked about that over and over again, but those are opening up new avenues for growth for us. The platform expansion. The latest chapter on that is AI, right? The revolution is bringing us more and more functionality that we're going to incorporate into the platform. And then international expansion. We actually have a person -- a customer from that international stage to talk to you guys as well this afternoon. But we're growing faster internationally than we are domestically. So long-term model, this is the same as it was last year, but I'll walk through it a little bit. We're targeting 80% to 85% gross margin, and we're getting there, right, with that mix shift happening. Sales and marketing, 30% to 40%. We're certainly going to bet on some more productivity as a way to lever that and get to that 30% to 40%. R&D, we're looking at our China India R&D center, which has been a monumental success so far. That's going to help us moderate our growth in R&D expenditures and help our percentages get in line there. From a G&A perspective, we've largely built the G&A machine we need for this kind of next chapter of our journey. And so we're not going to see ratable increases in G&A anywhere near our revenue growth. So it will be pretty contained and I think with that growth over time, we'll get to our target model as well. And we're also looking at some of those lower-cost regions as a way to expand future G&A hiring. And so that will ultimately get to an operating margin of 20%. And here's a little note for your guidance. We're pre-releasing our Q1 results. We've just filed an 8-K today. And so on our cloud subscription revenue, we're coming in north of the range at $86.6 million. north of our guidance, and that's at 24%. Total revenue, $149.8 million, which is on the high end of our range, 11% growth. Adjusted EBITDA loss, we did considerably better than our range at about $1 million in change on our adjusted EBITDA loss. So obviously, we'll get -- I'll share more details on that in the earnings call. We'll talk about guidance and all the good things that you guys want to know about, but that's a sneak peek on the results for you. So I actually don't have much else on this presentation. I know we got Q&A at the end. But if there is any, I know, there's a lot of information. If there's any questions for me on this stuff, feel free to ask. Otherwise, we can wait until the end.

Sure. Well, I think we have a mic coming. And a few on mind for the live stream introducing yourself, too. Yes.

Sanjit Singh, Morgan Stanley. Thank you, Mark, for all the content. I wanted to go back to how you're thinking about growth more broadly, maybe it's just subscription or cloud subscription because you talk about a TAM that's growing 30%. Right now, at this stage of growth, we're in the sort of mid-20s on cloud, below 20% on total revenue growth. So in terms of like squaring that if the market is growing, potentially 30%, does this imply that you guys are anticipating the acceleration in terms of total revenue growth? How do I square kind of those two...

Yes. I mean I think it's safe to say that our -- first of all, we look at subscription growth as kind of what to compare against the market. We don't really look at total revenue because we don't have a product carrying team trying to sell services that is focused on just services. So it's not our motion. We're a software growth company. So our subscription revenue and our cloud subscription revenue more specifically is what we look at. And surely, we have internal ambitions to be much higher than we are in the mid-20s. And I think we've historically been at 30% plus. And so we're trying to get -- obviously, the macro backdrop improvement is hopefully coming before us right now, and that will set the stage for some traction there to get back to 30% plus. But it's certainly -- the market is certainly big enough and growing fast enough that we feel like that will support it.

In terms of just that macro backdrop as you guys sort of gave us a pre-release of the results. What does 2024 starting off look like to you guys in terms of the spending environment, the budget environment versus what we saw last year? Is there any notable improvement? Or is it still much the same?

Yes. I think it's stopped raining, but there's still clouds in the sky. So we're still carrying on. So we definitely want -- we don't think it's over, right? Like there's still headlines every day about what may or may not happen. And I think that's in the back of the mind of purchasers of software and all spending. Is it a bad end market? No, it's -- I think it's more of a backdrop item. And we don't think it's getting worse. It's probably getting a little bit better.

Jacob Roberge with William Blair. You talked about 40% growth in sales rep productivity. And then you mentioned that the India China Center of Excellence has been kind of a monumental success in driving leverage. What are the kind of incremental building blocks to drive more efficiency on the go-to-market side, especially with -- there's been some changes in leadership in that organization. So as you step into the next phase of growth and potentially looking for an acceleration, like how do you drive more efficiency in that go-to-market portion?

Candidly, the first thing you do is you hire an expert in that area, and he's sitting right there. Mike does have the blueprint for us for prior success of different organizations. But it involves getting your reps to fall into this value selling methodology into a motion that is more valuable from an outcome perspective. So the Go Big, bigger deal, bigger landing philosophy inherently will add productivity because gone are the days where you're going to fight 9 to 12 months for a small deal. That's not -- we're not doing that anymore. And there's a multitude of enablement and training and other things that Mike's working on. But just from a numbers perspective, we know that the appetite is there for the larger deals and those expand better. And so gearing up the team to point to those deals, I think will alone, even without all the different tactical improvements that we're making on enablement will improve the productivity. Was there a question over here?

All right. Great. Thank you. Steve Enders from Citi. I guess maybe just thinking about the EBITDA margin and kind of where that's going. I mean, it seems like there still is a lot that needs to happen on sales enablement and like everyone is talking about AI and trying to drive more opportunities out there and kind of spending behind that. But I guess how are you kind of thinking about where the margin trajectory could go kind of in the medium term as we think about this backdrop?

Yes. On our adjusted EBITDA margin, I think the message I was trying to get across is that the level of improvement we've seen in the past 2 years will probably replicate in the future in the next 2 years. So it's a trajectory. We're on this kind of slope, if you will, of improvement. And obviously, we'll give you more details as we get through to the quarter and talk about earnings and update our annual view. But I think the plan is to keep on this trajectory of improving EBITDA. Okay. I think we have a break next. And of course, there's time at the end for Q&A as well. So we'll let you guys take a few minutes for yourselves, and we'll be back at it. Thank you very much. [Break]

Okay. We're going to get started here in about a minute. So if you guys wouldn't mind taking your seats, please. We're going to get started in 1 minute. Thank you.

Good afternoon, everybody. Thank you for having us. Really excited to be joined here by Kirsten Hill, who is the low-code technology leader for KPMG, 1 of our longest tenured and deepest partners. In fact, congratulations. Just on our transformation award at Appian World. So thank you for being here. I wanted to spend a few minutes just chatting with her and getting her viewpoint as to our alliance why KPMG is working with us, how they're working with us and what they're seeing with our joint customer base. So thank you for being here.

No, I appreciate it.

I'm going to give a brief introduction to your career...

Sure. Good afternoon, everyone. I'm part of our technology enablement practice within our consulting business. And as Chris said, we have been -- alliances are a really big part of our firm's business and our success in the market, and Appian has been a great partner of ours as well. So happy to be here back in D.C. Happy to talk to you a little bit about our journey with Appian and what we're seeing in the market.

Okay. Thank you. So first question I had for you is we've had a long-standing relationship for a long time. It has grown. We've had wonderful client successes. What do you attribute the success of the alliance to?

Sure. I think for us, it's twofold. One is -- we both have shared values and culture, which is very important and very important to how we show up with our clients. We work shoulder to shoulder with you all on building those trusted client relationships, and having a deep understanding of the industry and the business challenges that they are undertaking. I would say, in parallel to that, it's both of our passions for technology and really driving it to the edge, seeing what the art of the possible is. I think those 2 things go hand in hand for us and the market together as we embark upon new clients. and even 2 challenge existing clients about where they can go next.

You just spurred an idea and sorry to go off questions here, but I love the idea of us being on the forefront and being innovators and driving technology into the space, that sometimes is a little disruptive. How have we shown and proven that we can do this and deliver those types of customer successes that will create value and long-term growth.

Sure. Well, I mean, solutions are a big part of our business as well and what clients expect to show up with today in the market and knowing their business. So for us, it really is -- we know 1 solution can't fit all clients, but there's obviously some sort of similarities. So really exploring and leveraging with the art of the possible there. In terms of kind of where our relationship has gone has really been more around years ago was probably doing a lot of proof of concepts, getting clients familiar with the capability. But now it's really evolved into this technology being part of their enterprise architecture and really a foundation to where -- what they talk about and how they strategize and where to take their enterprise business over the next several years. It was very introductory now it's embedded in a lot of where our clients are headed, and it's a part of the natural conversation. So...

What makes a platform like ours attractive to you all from a business perspective that you want to drive that into the customer accounts, what does that look like from a business model perspective for you as you're growing?

Well, I think with a platform such as Appian, it's the agility that it serves. There's a lot of great technology out there, and it stands well with others. And for us, again, it's the agility to really make enhancements to do things quicker, faster. And then for us, too, a lot of what we do in the technology space is we'll do a lot of technology implementations, but what we pride ourselves in doing as well as giving it back to the client to own and to be the future of that technology. So for us, I think it's really been just the ability to adopt it easily in the business and in IT. I think traditionally, as many companies do, they tend to sell technology, technology. But we've really seen a lot of smart business clients on the business side of the enterprise, really adopt low-code and digital process automation type technologies out there today. So it's really been a great adventure for us to be able to work across a client ecosystem in enterprise.

Yes. What are some of the use cases that you're seeing that are patterns in large enterprises? And kind of what does that maturity look like? You touched on that a bit about the POCs on the early days. Now it's part of the architecture, what are the emerging cases that you're seeing coming up that you're excited about?

Yes, I think we see a lot around global connectivity, again, the notion of low code, I think that there was probably some ideas on there that maybe could or couldn't scale. Could you take something like that globally, especially around thinking is what we do a lot of our regulations and other activities and we've really seen the ecosystem of loco platforms, be integrated with global enterprises and doing a lot more complex things that I think that some clients, they just underestimated because explored enough. But now that it's been part of their architecture for so long, it's much more of a trusted technology. We're seeing -- so we're starting to connect a lot of global parts of life sciences and other organizations that are fairly complex, and able to meet those clients' needs pretty rapidly, especially again, the evolving regulatory activity that's out there, you've really got to respond and have that audit trail, if you will, for some of the things that they're going under -- or they're going through right now. Another thing that we are doing as well is we innovate a lot together and solution together, particularly obviously around the area of AI. So we're taking some of our existing solutions, creating better, let's just say, the next generation of some of those solutions. Maybe like know your customer, which we do a lot in financial services type clients and really leveraging the power of AI, a trusted AI environment within that client's ecosystem and embedding that into alongside the capabilities that the platform has. And that has been a really, really big game changer for our clients. We actually did a survey last year. GenAI survey with about 400 CEOs and other leaders across the U.S. and 93% of them said they would be investing in GenAI over the next 12 months, 43% of them said they were going to invest $100 million or more. So there's as much as we see a lot of different economic headwinds and stuff out there, these companies are taking this very seriously because it will change many parts of their ecosystem, not just technology, but workforce and other aspects. So we're really excited about really kind of pushing the edge there on some of these technologies and figuring out where we can get the best out of leveraging trusted AI with those clients.

Yes, really have enjoyed. This is where I get to roll my sleeves up and get to geek out a little bit the innovation sessions that we've had in driving it and identifying what we can do and applying it over to those next generation. So that's great. I'll loop back around, you mentioned the CIOs, their investment of technology, the excitement around it and the plans for investment. I want to loop to the other side in early-stage career. You all have a team that is doing the live build challenge. What is their adoption been to the platform? What are they telling you about the technology? Is it something that they, too, are finding excitement about that how easy has it been to bring folks into it and kind of keep them in the ecosystem?

For sure. So we have 3 folks participating in the live build challenge. And actually, we're talking about it. They've gone through half of the challenges so far. They have a couple more to go. And -- just speaking to them at lunch, it was very interesting to hear their excitement around even how far the product has come over the past several years because some of these live build challenges they're doing, they actually have to do it in a matter of minutes which really kind of test the acumen and the agility of the product, right, and actually having a valuable outcome that they're judged on. So they're super excited to be -- to see the evolution of the technology, to also strategize on -- there's obviously multiple ways to answer a business problem and the agility that the product has, has given them the opportunity to explore. And then for them, too, they're on the ground with clients every day. So feeling confident and comfortable that you can explain and talk to a client about how the platform will work what it will do for them and the valuable outcomes that will provide them, builds a lot, a lot of confidence, obviously, in our clients, too. So it just -- it really resonated with me today, just hear their outcome from doing that live build challenge. And I think it's great because I think that's how our clients will feel on working with technology such as this.

I heard Mark, I stepped in at the tail end of his and he was talking about both new logo acquisition, which we're working together on and identifying those targets, but also expanding deeply into existing accounts. You mentioned the consultants hearing and understanding and be able to speak to it, but also identify that next opportunity. Can you speak to kind of what an example growth profile within a large customer, what does that look like for you? What's attractive about that situation when you can expand into an existing account on a platform.

Sure. So for us, we work with very large enterprise companies, and they're obviously could be very siloed. So having those success stories really can run across multiple departments in a great way and building that confidence. So we've seen that in a lot of different markets. And again, too, it really helps with rallying around the investment that these enterprises are making. And how do you get the best out of that investment is always a question that clients are asking. So it's important for us to be able to explain and kind of architect the -- multiple things that these platforms can do. So it's -- for us, it's a great way to get to learn and support many areas of the business. And again, a lot of our clients like to end up and own -- supporting the platform in the future and developing it on their own, and we highly support that as well. So...

Great. So looking forward, what do you view of the marketplace? How are you seeing it evolve? And are you planning on more growth? How are you investing in, in order to take advantage of what lies ahead?

Sure. So we -- KPMG actually talk about how we really are a technology-enabled business. I know most people in the years past, maybe only thought of us as audit and tax, but we are really a technology-led company, and we're super excited about continuing to lean in to new technologies and to explore and to do new things. I mean, again, we've made some pretty large AI announcements within the past 1.5 years about our business, and we're really serious about investing in ourselves and investing also to help our clients explore the next generation of technology. So we're really excited about what's to come.

Okay. Great. From a solution perspective, we talked on that a bit. What are the types of environments that you're seeing entry points? Are they lagging industries? Are they highly regulated industries, a mix of them that you're saying, "Oh, we can go tackle this now from an automation perspective from an AI perspective.

It's a good question. I think industries are -- the level of adoption really depends, I think that there's a lot of companies out there that really double down on digital modernization several years ago and some that maybe didn't. COVID really kind of made things a little lumpy. But I think now there's been quite a -- clients are still continuing about moving forward because many of our clients as well are technology-driven businesses, right? I mean that's the way you evolve today. It's a way they're going get close the customer. It's a way they're going to drive down operational drive operational efficiencies, drive down costs, et cetera. So technology is always going to be a part of their business. So I think for us, it's really just been staying with them and understanding where they are and their journey and what, again, is most important to them based on their industry or the regulatory environment. It really just depends on the industry, if you -- to be honest.

Good. So I just came from overseas in India, meeting with your India and KGS team, was in Italy with your team center over there. I know you've got Portugal. We're doing a lot of work in the U.K. A lot of your customers have that same footprint that they are all over. What does that collaboration look like between member firms? Are you all talking? How do you work from a global account perspective, in order to ensure that you've got successful delivery and you're taking and drawing from those experiences to share amount?

Yes. I mean for us, it's really staying close to the customer. So it really depends on where the work is being driven or the sponsors are. We are a member -- we are -- KPMG is a firm of many member firms. So we work closely with those in other countries. KPMG U.S. does actually have an entity in India that we use for offshore needs as well. But we really just collaborate as one firm, to be honest with you, around tooling methods, getting people -- we want to make sure delivery has always been first and foremost within our firm and making sure that the quality is there, no matter where it's being delivered from. So we have a very tightly integrated firm of firms, if you will, just by the way that we're structured that we lean on and learn from and explore with. And also, too, it really helps our clients with the delivery model because, again, so many of our clients are global. So having that optionality to have people local to wherever they are is something that we offer.

Great. I guess, one of the last questions I have is differentiation. You mentioned technology has broad applicability, lots of you can come at it from different angles. When you choose an angle and an alliance like this, how are you ensuring that you are differentiating in your delivery and what you're offering to your customers from other consulting organizations as well.

Again, I think it goes back to knowing your customer and knowing our industry. We're an industry-led firm. So -- and we're very transparent and honest where we believe we can add value, and where we sometimes believe we are maybe not the best firm. So I think for us, it's just having that transparency and conversation with our partners on what's the right fit depending on the client and the need. And can we meet that need and can we provide the outcomes and the value that the client is looking for. So it's a conversation we have with every opportunity is what's the right team look like and what's the right answer for the client.

And from a solution perspective, obviously, you've spent some cycles on that. Do you continue to look for what's the next-generation solution? Are you going to be investing in those as for repeatability, for differentiation or all of the above?

All of the above. All the above solutions are where clients are looking for you to show up with a solution. Ideation is great, but they really want to see and get their hands on things pretty quickly. So for us, we feel like that's a really great differentiator. And again, while we invest time and with specific solutions or industries that are repeatable as much as can be -- as much as possible. But that's -- I mean, clients don't have a lot of time and/or money to waste. So they want to start seeing valuable outcomes quickly. And that's really what we strive for in the Agility platform.

I think that's the other which is that return on investment. But the speed of it right now, we were talking about how deals are flowing right now and how they're moving, but also some of them getting chunked out but showing that quick return, how obviously, that plays into the expansion and opportunity within that account too. How have you guys kind of trained your own team and staff to identify what can be next in your customer arrangements once you get that foot in the door with their solution or through another project?

Yes. I think a lot of it, again, is through building client relationships you get to spend a lot of time with a client and you get to know more about how their organizations are designed or again, we have leased around our clients with industry subject matter experts that build those deep relationships and we share internally where we think we could continue to help them evolve. And that's why we've been in a lot of clients for quite some time with Appian in other places. So it's just building that trust. And again, repeatable solutions, I think, are really the answer. It doesn't mean you can't explore into other things. We've actually found where we have built some great solutions the clients asked us to extend into the enterprise and look at some other activities that may or may not be related. But that goes back to their trust that they have, that we're going to do the best by them and their technology.

Yes. And investment in your people. I'll give you kudos was in credit for the certifications and continuing to drive this from a developer perspective, from leads, from architects and on the sales side too...

Yes. No, that's really important.

Yes. Good. Okay. I think that's what we have for today. Kirsten, thank you so much for the partnership. Thank you for the continued growth and innovation and stop by their booth if you get a chance, see some of the solutions that they've built. So thanks for having us. Thank you.

Thanks, Chris.

Now we will hear from Pavel, our Chief Customer Officer in customer interview.

Hello, everyone. We have reserved the best for the last portion of the day because the best is to hear from customers, right? I mean I -- when you hear from the Appian people, you hear a lot of our enthusiasm and our ambitions. But if I was listening, I would probably listen with a different ear to what a customer would have to say about us. So first of all, Luigi, thank you very much for being with us today.

It's a pleasure.

It is a pleasure to hear about your story. So -- can you start with a brief introduction of you and Poste Italiane?

Okay. So first, let me thank all the audience because it's 4:00 p.m. It has been a long day. So you are heroes that are still here and try to follow along. I'll try to entertain you a little bit -- talking a little bit about our story with Appian. So first of all, who I am? I'm the Group Chief Customer Operation Officer at Poste Italiane and Poste Italiane is really a big company. Poste Italiane as the name I remind you that is a postal services. We started 160 years ago with shipping e-mail -- shipping mix, sorry. And -- but then, of course, as I heard this morning, change is everything. So we had to change a lot in order to stay relevant. And we are still very relevant company within Italy because we have changed a lot. And just to give you a few examples. So now we don't deal only with postal services, but we have, of course, entered into delivery of parcels. Then we have entered the banking. So we have our own bank in Italy that is called BancoPosta, that is one of the biggest in Italy. We are also a leader in the insurance, where we are the #1 when it comes to life -- market life, and we are also growing in asset management. And then we are very, very large when it comes to payments. We have 23 million bank cards with the Italian people. And we also entered, more recently, the telecommunication sector like 15 years ago, 17 years ago with the -- we have the biggest mobile virtual network operator in Italy. And we also added on it the fiber services that we launched a couple of years ago. And then we also entered the energy and gas just beginning of 2023. So it's a quite complex organization. But the most important thing is for Poste Italiane is that if you go around Italy and you forget about Florence, Villanders, you go in a very small village, you find 3 things. What you would find? Let's see, if you guess. So you will find a church. You will find the town hall, and you will find a postal office. So this is our strength, that we are everywhere in each of the country. And we're discussing yesterday that Italy's 59 million citizens. Unfortunately, we are shrinking. We need to do something about it. But we have 35 million customers. So almost every Italian is our customer.

Yes. I mean we're talking about the relevance of Poste Italiane and that -- I don't think we have any other customer in the world probably that has that penetration in the local market is also amazing, you have about 13,000 offices. So penetration Luigi was telling me that in any town, the smallest town in Italy, there is Post Italiane. So the penetration is [indiscernible]. So a company with 160 years of operations and so has done a lot of change. But you've been involved in digital transformation. Can you tell us why you started that?

So we started to think about how to change our way of working, our operation because we had a very traditional way of working just a few years ago. So as you can imagine, we were a lot of paper-based company. We had a lot of paper to deal with and with paper, the responsibility chain in order to make the process going from beginning to end was very long. And with paper, physical paper, what we have to do is that sometimes these responsibilities were in different departments and in different cities. So we have this paper that was traveling from one department to another within the same building or even from one department to another in different buildings. You can imagine how long it takes, how difficult it was to track it to have a clear view of the consistency of your backlog. So most of the customers said that very good on time. But when you get exception, then it was going to be difficult. So in 2019, we understood that the maturity of the products of the BPM or the digital process management system were good enough and we issued the tender. And Appian won this tender and then we started our collaboration.

So do I hear that a portion of that digital journey was about efficiency of internal processes and the services that you provide to your millions of customers.

So efficiency, of course, is always on the agenda of any manager. So when you talk with your boss, always talk about efficiency, but on top of it, there is also to take control. We want to take control. We want to understand exactly what was happening to the -- each of our customer when he was buying a product or a service of Post Italiane, each and every. So this is the reason because my organization changed the name and became a Customer Operation instead of a Chief Operation Officer because the customer is at the center. In order to understand exactly where you want to open a bank account. And I want to be sure every morning that I know exactly if you are going to get your bank account opened and working within the 24 hours that we promise when you sign the contract. And this goes for everything. When you buy any services, most of our services, especially the business one require a contract. And for example, when I started in order to activate a parcel contract, it took 25 days because you need to check the level of risk of the company you are dealing with. There is a lot of administrative tasks to be done, but see 25 years -- sorry, 25 days was really too much. But 25 days was too much, and now we will do the same in a few days, so less than a week. And again, what was our ambition when we engaged Appian was really to, first of all, digitalize. So move from paper to digital processes. And even when you need a physical paper, we want to scan it at the beginning. So that then all the people, you don't need to move the paper from one city to another, just go to the system and do whatever you need. And through Appian, we had the possibility to also orchestrate the work of humans and also the work of robo. So we introduced a lot of robotic process automation in order to simplify the interaction between people, our employees and the system. Behind any complex process, you have a plethora -- lot of IT system or you have a classical SAP, you have -- we also have a bank and insurance. So as you can image, we have Mainframe with 3270 interfaces. So you -- before the introduction, Appian, it was impossible to give an end-to-end task to a single person. So we had the expert of SAP and then did this job and pass the activity to the next, that was expert of mainframe. Then the next it was expert of another technology. And when you pass the responsibility and the ticket from one department to another, this is the receipt for a long time, backlog exceptions and it's a nightmare. So with simplification, we introduced it with Appian, and the robotic process automation, we hold the complexity of knowing how to interact with the different IT system was delegated to the RPA, everything was orchestrated by Appian. And so we gave the responsibility. Most of the cases, one single person that needed to deal with the task from beginning to end, and this is really a paramount shift.

Excellent. Fantastic. I forgot to mention at the beginning, we're going to have time for questions. So as you hear the story of Poste Italiane, please prepare your questions, so you can ask them. Really tell us more about this notion of how do you define the objectives? How do you track value in using Appian?

Of course, when we talk about business process even before the introduction of Appian, we had our KPI that is normally how long it takes to complete them, how many exceptions do you have and so on. And for this reason, I can say that when we have introduced the Appian, we have changed, of course, our way of working. We have also generated some of the process because there are some processes that are so bad that these users that you automate and try to keep the best out of them. It's better to reengineer the process from the scratch and then you apply the technology to take control of it and automate. So to this extent, we have a business KPI to measure our processes and also a very simple one. Like as I said, how long it takes. And for example, and also without Appian, we were not able to comply with some European bank regulation or Bank of Italy that is the Italian Central Bank. The required certain things to be done within a certain amount over time. Just to give you an example, that is the payment repudiation that needs to be dealt within 24 hours. Payment repudiation means that when you do a transaction and you receive an alert from your bank and you say, okay, it's not me. I have not done this transaction. So you open normally a ticket with your app or you write an e-mail, whatever is the way you communicate to the bank. The bank in Europe need to give you an answer and possibly give you the money back within 24 hours. Before introducing Appian, we were between 5 to 7 days. And considering it was before the pandemic. So during the pandemic, especially in Italy, we had an increase of digital adoption that was crazy. So today, we do all payment repudiation in less than 1 day from 5 to 7 for 3x the volume. So if you just do some little maths, it's 15 -- x15, up to x21 efficiency that we achieved and also [indiscernible] because when you do a repudiation you really -- especially if it is a lot of money or significant money for you, you really don't slip in the right. Knowing that in 24 hours and as an average, even less, you will get the money back it's really a different feeling from our customers.

Yes. Of course, I mean, 21x, I think -- it is a spectacular. I can provide that -- please this time.

Yes, we do. Okay. Also, as I said, for contract activation, we were very rigorous and very diligent, but this means that you need to check a lot of data basics to see if your potential customer has a lower level of risk is good at paying regularly because nobody wants to do business with a bad customer, right? And it took 25 days to do that. Now we are, as I said, between 3 and 5 days. So again, it's really an incredible achievement. There is another big, very complex process that we deal with that is the inheritance. So when our -- one of our customers, of course, end his life. There is heirs that need first to understand what is the consistency of the relationship with Poste Italiane of the deceased person. And of course, you need to check all the bank account, the insurance, the investment and especially before the introduction and digitalization, it was really difficult. It took really a month to understand to see all the paper and see if you have any money left. And now again, it's a matter of a couple of days, few days. And the second is that, of course, it's the [ liquidation ]. So when you bring a documents that clearly define what is your quota of this inheritance, we have to pay of course, the heirs. And again, it took more than a month, and now we do it regularly within a week. So you come on Monday, on Friday you have all the money, your quota on your bank account.

Nice, I imagine there are many people getting [ inheritances ] that are happy with that change. Now I acknowledge that Poste Italiane has been explicit about the strategy of driving innovation within the strategy and become an iconic representation for the Italian market as a whole. Can you say more about this vision of innovation?

So with our relevance for the country and with our presence in almost every small villages, small towns, small municipalities in Italy, we really have the power to make an impact to change. So what we have started just recently is a policy that we -- sorry, it's a project that is called polis, that is Greek name for City on which we bring the public administration services close to our people. So we are opening our postal office to provide certificates, public administration certificates, but even issuing the passports locally in the small village, small towns, so you don't need to go to the main city close to you. And we are also bringing new innovative services, digital broadband services in the small countries. So this is really making an impact.

Of course, I mean, there's a vision that one day government services will be efficient. I think you are pioneering that journey for Italy. It is great to hear. I'm going to ask about the future of your -- our relationship. How do you see that?

So as you can imagine, working in all these industry sector, we have many, many business process. And even if we have started now, let's say, in 2019, the contract was awarded to Appian, but we really started to deliver, I would say, including the pandemic period by the end of 2020. So we still have some processes like, for example, in insurance, we're talking this morning about it, that we need to roll out Appian in order to incorporate insurance services within the Appian platform. But then the next step, of course, everybody is talking about the artificial intelligence and in particular, the cognitive artificial intelligence. So this has a huge potential. And we are going to introduce it. We will leverage what was mentioned this morning by Matt Calkins about this Kick-Start program. We would like to really have a couple of significant business processes to be proved with the cognitive artificial intelligence and move forward.

Nice. That's exciting to hear. I know some of my team members are making notes about the new project. All right. Let me check with the audience and see if anyone has questions for us. Question? Can we get a mic?

Namir Chowdhury from Advantage Alpha Capital. Luigi, very impressive efforts that you've had in digital transformation. Just curious, when you started the process in 2019, what was the vendor selection process like, which vendors did you consider? And why did you choose Appian?

It was, of course, a public tender. And we invited all the best players according to the analysts, like for [ Stargate ]. We saw the Magic Quadrant and we invited the best suppliers available at the time. And then we did first the classical evaluation based on technical parameters and economical parameters. But still, it was not enough. So what we did, we challenged the top 2 with the case development. And the one that developed the cases quicker and more aligned with our business requirement won, and it was Appian.

Wonderful question. So any other questions from the audience?

[indiscernible]

I didn't know. I will not, you will. All the competitors. Yes, it was. Excellent. There's any other questions? Great.

In terms of the implementation and you're looking at a broader automation stack, are you using Appian primarily for workflow? Or have you had experience with process mining capabilities, the RPA capabilities? And what's been your experience with other parts of the portfolio outside of workflow?

Okay. So we started with the workflow management, especially we like the capability of orchestrate manual work, digital work and robotic work, right? So you got the point. But of course, now we are using more and more capabilities. And for sure, the artificial intelligence is something that we are going to start very soon. When it comes to the process mining, we were -- we selected the competitor of Appian before Appian entered the process mining. It's one of the leaders in the market. But still, I was just discussing with some colleagues and with [indiscernible] this morning, that the problem with -- when you have -- even the solution that we are using is very, very good. The problem is that it's not embedded in your solution. So when we do the analysis on process mining, and we see that we have a lot of deviation compared with -- to the straight process, the U.K., you make analysis. You see it that you're already new, by the way. And then what? With the integration in Appian will be very different because you will have a certain degree of automation that will make your life much easier. So you find out a gap and you also know how to fill the gap. Otherwise, you know the gap and then you live with it that is useless.

Well, it's useless or even more. It's painful because you know you are losing the one, but you cannot act on it, yes. Excellent. Let's check. Anyone else? Well, Luigi, thank you very much. Thank you, everyone.

Thanks, Pavel. Now we'll transition to general Q&A with Mark Matheos and Matt Calkins.

So we had a few questions already. During the presentation, we covered some of the financial questions. But of course, you guys feel free to ask any questions on that part of the presentation or any of the presentation you'd like. We have a question up here, Steve Enders.

Okay. Thank you. Yes. Great. Steve Enders from Citi. I guess, maybe just to start, it sounds like there's some new pricing and packaging that's coming out. And it sounds like maybe simplifying the process for customers to get up and running with Appian, but would be great to hear just a little bit more detail about what's actually changing, what this means for existing tiers and customers transitioning over and how you kind of envisioning this kind of changing the model for Appian.

Great. Okay. Before I get to all the selections, all the different varieties, we're going to consolidate down. I want to make the first point that we're going to make this as easy as possible on everybody. The point was to reduce friction, not add it. And so we're not forcing anybody onto different licenses. We're not going to force our way into any negotiations that we don't want to have. The point here is just minimum of overhead and an elegant way to move forward with new contracts and new purchases where applicable, all right? So we used to have a wide variety of SKUs that we would sell. You could buy Appian by the user. You could buy it by the app. You could buy it by the month, basically, the development month, right? There is -- there are so many different ways. And what we try to do is take just the best the most popular out of all those ways, which happen to be pricing by the app, but measuring the value of an app based on how many people use it. That's the best proxy for the value of an app. And so that's what we're going forward with. Selling by the app, but measuring it by the number of users who touch it. And we've got 2 tiers of users. So there's like a trivial user or call it a marginal user or something like that. And then there's a regular user. And that's the whole thing. You don't have 7 options anymore. You've just got this 1 model, should streamline things substantially, cut short the discussion. What we're trying to do is take hours away from pricing discussions and move them to value discussions. Certainly, we're not going to win on price anyway. We're not trying to win on price. And so like they say in politics, if you're talking, you're losing, you're explaining, you're losing, right? So I don't want to explain on prices anymore. I want to move on and discuss value. And so this is our impetus to just rapidly transition. But we're not inconveniencing anybody. Every customer can keep the licenses they've got. We're not forcing them off. The reason they would make the move and we're going to make it as simple as possible is because we've got new features that draw them not so much into the future price categories, but into the future -- sorry, not so much into the future licensing scheme, but into the future price categories. We want to tempt them into the new versions with great functionality. So we've got a new tier that's higher than the regular tier by 25%. That includes case management Process HQ, AI, we've put some really good stuff in it, all right? Eventually, we may have an elite tier as well that would include AI. But right now, we didn't think it was prudent to try to do 3 tiers. So we've got one up mark 25% higher. And a lot of the terrific stuff that we've shown in this conference is at that level. And so if customers want that, they'll just pay a little bit more.

Okay. Great. That's super helpful context there. And then maybe just on the AI side, just feels very, very topical. The new AI kickstart program that you have kind of coming out, would you kind of imagine the use cases that Appian can capture with that? And kind of what the early customer signal has been so far?

Well, it's been hours, and they don't let me out of my cage. So I have no idea of what the reaction is. However, I guess, maybe a few people have mentioned it in meetings with me. So the reaction is non-0. I'd love to see that catch on. I do firmly believe that AI is in a wait-and-see moment and the customers need to take small steps, and we're going to make it easy for them to take a small step and we're uniquely positioned to be able to make it easy for them because we control the process. And processes like the perfect flower bed to put the seat into. We want to encourage them to take that easy step and see the benefit.

Sanjit Singh, Morgan Stanley. Thank you for the informative Investor Day. I have 2 questions. first, on the AWS strategic collaboration agreement. Could you talk through maybe 2 pieces, the sort of go-to-market initiatives with AWS? And to what extent is there a sort of an economic component, meaning in terms of Appian salespeople and AWS salespeople being incented to drive deals and open up new accounts. Maybe that question first.

Okay. What's that -- what do you want first?

The AWS.

AWS.

Yes. And then the second question was around Process HQ. And maybe just tackle.

Come back to you on the Process HQ. Okay. AWS, is there a financial component? Yes, there is. Are we going to collaborate? I don't have all the details. It's recently inked. But I -- but yes, it's financial. Yes, there's millions of dollars at stake here, and they are subsidizing and we are cooperating financially.

Yes. So just to add a little bit of color. We do have a compensation component, those AWS reps they actually have been historically comped, but they will be a comped at a more premier level, let's say, within their own comp structure for selling Appian. And we'll have all sorts of co-marketing and other initiatives as we go to market together. So this is a pretty premier partnership. It is a limited number of participants. So it's not one of these typical AWS arrangements. And it's obviously early days, but it sounds good so far, and we'll hopefully see some good results.

That's great to hear. And then on the Process HQ side, I mean the simple question is like I think I missed like what's the next gen aspect of this relative to the process mining capabilities that you have. So what does Process HQ enable? Or what does it enable for customers that they weren't getting before.

They weren't getting. Okay. Yes, it's actually a major leap forward versus process mining as an industry. Process mining used to be. You do a lot of research into the way your processes are running. And at the end of that research, you get a report -- and the report tells you that you're inefficient in the following ways and then you have to go to some lengths to implement the correction to that report. And if you ever want to do another diagnostic, well, that's going to be other few months. That's the old process mining approach. We definitely wanted to break that. We want to break the first part about how much research it takes before you know what's happening in your process. We want to make it instant. You just see it anytime you switch over, and there's your real-time heads-up display on what's happening in your process. And then we wanted to correct the second part about how long it takes to implement a reaction to the report that you see by collapsing that down to, oh, and by the way, you're already in your process environment, go ahead and make this change. In fact, even better, we'll tell you the top 5 changes you should make and then just click through here, and you can make them. That's what we're trying to do. We realize that process mining is a good piece of functionality in between 2 egregious buffers of excess expense that nobody wants to plow through in order to get to the center. It's too much I don't know, burger and not enough patty, right, or something like that. So what we're trying to do is cut away all of the delays and get you right to the value of process mining. And then that's not only different from what we've offered in the past, it's different from what anybody has offered. And it was our idea years ago when we got into process mining that only a process vendor could properly do process mining. And then the fact that we've got this data dimension just makes it more effective.

That makes sense. Can I sneak in one last one. It's a follow-up question is the pricing question. On the new AI capabilities, we have like a standard SKU, annua advanced SKU and a premium SKU. That 25% uplift, is that advanced over standard or premium over advanced?

It's advanced over standard. We're not selling up advanced right now. If you buy advanced today, you get 12 months of the top-end AI features. So it's like you bought everything. There's no reason to go higher than advance today. The intention there is to get usage on our AI functionality so that later we have standing to raise the price. But we're not deploying that upper tier yet.

Understood. Great.

And yes, it's a 25% raise off of where they are today. It's plus 25% to get the advanced here.

John Everett from Hawk Ridge. On the pricing stuff, if a customer wants to keep using these AI features, do they need to start paying for the advanced tier immediately? Or can they wait until renewal and keep using those features and only then do you force them to pay up.

Let me understand your hypothetical. The customer has AI features. How did they get them?

Right. Say they're using Data Fabric and all these features today before you rolled out these tiers of pricing. They need to -- yes?

Anything that they're licensed to use prior to the new pricing, they're licensed to use forever. We're not clawing anything back. but we put forward a bundle of new functionality, some of which is so novel that nobody has got the right to use it. So we've got this bundle of new things, Process HQ, AI, case management, et cetera. And if you want to use that bundle, you pay for it. You pay 25% more no matter what you happen to have a license to in the past, right? That's just a new notch. And could they keep using it? Yes, they could keep using what they're already using in perpetuity. But we'll keep giving them reasons why they should notch upward.

Steve Enders with Citi again. I guess, I want to ask about the industry focus that you're going after. I mean before I think game was a big focus. Now it seems like there's more on the insurance side. How do you think about the next incremental use case to go after there? And then how do you get kind of like the go-to-market right, for just kind of individual solutions versus selling kind of the broader platform approach?

The go-to-market should be that if we sell a solution for a particular function no one is allowed to sell anything but the solution. We shut down our own platform competition for all of our solutions, and we become one note advocates for the only -- that's the intention. I know nothing is perfectly clean, but that's what I want to do. I don't want to split it. If you do, you get into unwanted competition, right? You could have -- you want a partner involved who would rather build from the platform and there's cross incentives there. It's not a good idea. Long run, I'd love to see most of our license revenue come from is a wonderful business for us. I want to build those solutions as quickly as possible. We think we've got a good angle on how to make them. We think that a series of connectable modules that share information, interfaces and log-ons and user experiences creates a pretty great experience. It's also a series of easy sales. If you've got solutions A through F and somebody bought D loves it, your odds are pretty good of making vast sales on the other components. It's easy to spread from there. So we love this business, and we want to replicate the playbook that worked in one place to others. My instructions to solutions -- and by the way, we're doing a lot of accelerated building around solutions. We built out a new dev center recently in Chennai and a good deal of that energy is going toward solution building. And our goal here is to build them as fast as we can provided they stay at goal level.

This is Will Jellison from D.A. Davidson. Mark, I certainly understand if this is a question you want to wait until the earnings call to answer a bit deeper, but the adjusted EBITDA loss came in a lot narrower than the guide this quarter. And I'm curious if there's anything in particular that drove the savings this quarter? And how sustainable they are moving forward, if there's anything to talk about on that?

Yes. I mean our trajectory, like I said earlier, is right on plan for kind of turning our adjusted EBITDA losses around. We've said we've exited [indiscernible] this year at breakeven. And so second quarter will, in fact, have a dip down in adjusted EBITDA like we've always modeled because of the seasonality of our on-premise revenue and I wouldn't read too much into the beat in Q1 because a lot of it might be timing related. But for more details, I will refer you to the earnings call where we'll talk about items for the full year and some of those timing issues.

Sanjit Singh from Morgan Stanley again. On the topic of GenAI and like, I think you sort of highlighted in your keynote this morning, Matt, that case management is like a majority of the use cases on the Appian platform. How is the case management aspects going to get better with Gen AI. Is it about sort of a user being able to ask natural-language questions about how processes are working? Or is it like a BI capability saying like you can ask questions without having to run some query to do it? Like what's the sort of like 1 plus 1 equals 10?

Yes. Okay. Well, it's more like 1 plus 1 plus 1 equals 10. And let me say why. The case management enhancements that we've bundled together are not AI per se. It's a wizard-like interface for rapidly constructing new case management applications, a series of objects that enable you to build a mature case management application quickly and generally polished and really good looking interfaces so that when you build it, it's sharp. It's not truly an AI enhancement. We've got -- but it's a 1 and then plus 1 is the AI, and we can easily add that. And the first place I would go with it would be collecting information from multiple data sources and making recommendations across them, replying customer service, that sort of thing. So it fits great. In the case management situation, the case after all is an item of work that depends upon data that's stored in many different places. And so the AI is a perfect fit right there. But when we talk about the case management package, AI is separate from that. It just interlaces really well.

Can I follow up on that? You guys have talked about that with Data Fabric, there's other vendors in this space, like a Databricks so say, like if you have your data appropriately catalog you guys could probably do have that with Data Fabric that you could understand how data is hitting certain tables, hitting certain processes and by function of that, learning that you can ultimately understand the business. right? And then you become not just a tool for developers, but this is something that a CEO or a C-level executive would be interested because you understanding how data arise and exits the business. Is there a theme around like data fabric infused with AI helping customers just understand the business in a much better fashion?

I do think that we've made ourselves better as a business understanding kind of layer than we've ever been recently. But I'm glad we're not in the position of having to say that merely by watching the flow of data, that's what you need in order to understand the business. Fortunately, we would fall back on Process HQ, which gives you far more than just a sense of how the categorized data is blipping up or down, right? We're actually watching the process. This isn't just the noun. It's the verb, right? And when you put the now and the verb together, you're beginning to get the whole sentence. So I do think that we're better than ever at having that overview on what the business doing, but I think that we rely not simply on the data but more -- or at least equally on the action and witnessing the action, which is flowing through our processes.

With the Data Fabric you're leaving data and sort of where they are currently and bringing it together in a virtual -- does it create any latency issues versus having data in one place?

Okay. Question is about latency and Data Fabric because you're supposing that we're moving the data, and I just need to correct that impression. We're really not moving it. So there's no latency in a typical out of a data warehouse situation, there would be latency or if you were loading a database, you're layer going to analyze, then you have latency, but we're going to the source systems where we're going to be completely fresh. We're going to the root truth and gathering the data from there. The Data Fabric is a virtual database layer, but it's not a unified database and the data doesn't have to move.

Okay. And then on the solution side, can you just remind us how many solutions you have today? And what's your goal over the next couple of years? And then just I think you seem really upbeat about sort of your solutions and the business there. What type of improvement do you see in sales cycle when you're able to sell solutions versus a more complex platform?

All right. There's different layers of solutions, first of all, and I want us to aim at the top layer, right? Organizations talk about solutions. Sometimes they mean objects, sometimes they mean a kind of a tool kit that could easily be made into an application. But when we talk about solutions, we mean things you could just turn right on and they work. And they handle an industrial scale application right out of the box. That's a solution. It's like a product basically. It's a product with a high degree of customizability due to the fact that, that product is based on a process automation foundation. So that's what I'd say a solution is. And if you want it, we could refine that still further and say a solution has all of that. And furthermore, it's part of a chain of interlocking like industry-specific modules. And that would be setting the bar really high. But in that case, we have two. And I suppose you could say, what okay, like I mean, you can quantify them in different ways. You could say we have 2, but their suites, right? Or you could say we have 6 components and 2 components, we have 8. And there are a few solo components banging around out there that could also be called solutions if all you need is that they'd be implementable and runnable instantly, then we got a few of those as well. However, we're building on all these fronts. We should have more series', we should have more standalones. We should have more partner authored solutions. I'm really trying to encourage that. We've come up with a new partner hierarchy, not to get too far off the sub to your question, but we've got a hierarchy of partners and the very top run for partners is those that we call them champions that provide us a way into a new market. And the way that they would do that typically would be to write a solution that's targeted in a market where we're not present. It could be a geo also probably a market, and then we would follow them into that, and we prioritize them with any leads that we received on that topic or in that market. So we are anxious to find new ways of using solutions as an entry point into new markets.

I'll turn it another questions. Steve Enders from Citi again. I guess maybe I want to go back to an earlier question that was actually asked during Mark's session on just the 30% TAM growth number that's out there like on the slides, and I think you're growing 24% this quarter on the early announcement for cloud. But how do you kind of think about what needs to go right for the Appian business to get that number back up into that 30% level?

Yes, do you want to talk about I already answered that question.

I think yes, we're going to compare notes, apparently. I was out of the room.

So I said the word macro. That's a hint. You said macro -- that's part of the Macro. One thing that can happen is an improvement in macro. I think Appian is capable of a great deal of improvement actually. Now I'm to look at what's wrong and how we can get it better. But I do think there's a lot we can do to be a more effective organization. We could leverage partners better. We could prevent present a cleaner message and a cleaner sales motion, we could be easier to do business with. I see lots of avenues for improvement. We are far from perfect. And so I see opportunity everywhere for us to increase our growth. And I think it's just a matter of execution really. We're in the right place. We're in the right place, we're a leader. We have a great product. We have happy customers. We have plenty of momentum -- we need to actualize our potential, and I'm being vague, but I think there's plenty of possibility here.

It's consistently high, Steve, right? We have the ambition. It is a macro. Did you let him get away with that. He did not. Anything else?

Well, look, we really appreciate your interest, your participation. It's great to see you here. I hope you've enjoyed the rest of the show for that matter, not just the investor session, but thank you.