Cellebrite DI Ltd. (CLBT) Earnings Call Transcript & Summary

Good morning. Thank you, everybody, for joining us. My name is Andy Kramer, and I oversee the Investor Relations at Cellebrite. I'd like to welcome everybody to our first-ever Investor Day. So some housekeeping and some things that we want to cover with you. The first things being first is our agenda for today. And I think what you'll see is the opportunity not only to hear from those on our management team, but you'll also have a great opportunity to hear directly from some of our customers. And you'll also have an opportunity to take part in some product demonstrations. And in terms of the product demonstrations, we have a couple of different opportunities for them, and one of them will take place at 12:00. So I know you all have very busy days. Really appreciate you taking the time to attend this event. And the product demonstration itself will take place -- we recognize that some of you may have appointments in the afternoon. If you're able to stay for the product demonstration, I think that will be a really impactful way to really appreciate what we can bring to the table in terms of our products and technology and how our customers actually use them. And we're also very fortunate that we do have a couple of our longstanding customers who'll take part in a panel. So reminder in terms of the day that the presentations that you'll see from management will be posted on our website after the event concludes. So in terms of what we'll be covering today, this event includes non-GAAP information. A reconciliation of our GAAP to non-GAAP metrics is available at the back of our investor slides. It's also available in the investor kit we post on our Investor Relations website. So please note that any statements that we make today that are not statements of historical fact constitute forward-looking statements. All forward-looking statements are subject to risks and uncertainties and other factors that could cause matters expressed or implied by those forward-looking statements not to occur. They could also cause the actual results to differ materially from historical results or any forecast. Some of the forward-looking statements that we -- that are discussed, they're outlined under the heading of Risk Factors and elsewhere in our annual report on Form 20-F, which we filed with the SEC last week on March 21. The company does not undertake to update any forward-looking statements to reflect future events or circumstances. So just some quick thoughts around Investor Relations. So when we -- I joined the company about a year ago. And from my perspective, one of the things that we've strived hard to do over the past year is to make our story easy to understand. And I think what you'll hear from Yossi, from Tom, from really all the folks on our management team is a strong commitment to our mission, and that mission is one that's very simple. Our products ultimately accelerate justice. They make our world safer. And you'll hear that commitment to our mission. And in terms of our products, you'll see how we deliver those solutions and really have organized them around 3 flagships product offerings and all of that riding underneath the platform. Transparency. This Investor Day is just one step in a process to make our story as easy to understand as possible. And we felt it was important to provide you all with an opportunity to hear from us not only about where the business is today, but where we think it can be within the next 5 years. The first 2 don't matter if we can't deliver. And we've put together the last 4 quarters a very strong performance. And we believe that, that's performance that can be sustained well into the future that we've got a durable, sustainable path for growth and profitability. And ultimately, I think that if we can deliver on the performance and all of the other aspects, that helps us build more trust, better rapport with those of you in the investment community. So just a quick word in terms of where we'll be later today, we'll be at the NASDAQ, and that will be a bell closing ceremony. So for those of you who are interested, that will be available online. And our efforts to work with you in the investment community don't stop after this Investor Day. So you can see we'll be reporting our Q1 results later in the month of May. Followed by a handful of investor conferences along with some NDRs that should trail alongside of that. So with that being said, I'd like to have our Executive Chairman join us. This is Tom Hogan, and he'll kick off our day. So Tom up to you.

Well, good morning, everybody. And let me add my welcome to the people that are here in the room and the people that are joining us online. I expect and I hope that it will be a really informative day, but I also hope and expect it will be actually super interesting. I've been in this industry for -- I'm reluctant to say, for 43 years, done a lot of stuff from ITIL/ITSM to infrastructure and a lot of stuff that's important, but pretty boring. This stuff is not boring. What we do touch is everybody in this room, and I think it's a super interesting story. So hopefully, you'll share that view when we wrap the day up. When I started to think about and prepare for this day, it occurred to me that I haven't done an Investor Day in over a decade, which is also sort of hard to believe. I spent the last 10 years running my first private company, then did a 2.5-year stent with Vista Equity and then came to Cellebrite. So it's been over 10 years since I've done this. So if I'm a little rusty today, you'll have to forgive me, but I'm excited to be here, and it's fun to tell the story. Some perspective on the agenda that Andy shared with you, what I would add is we're sort of taking a pyramid approach. So I'll fly high and I'm going to be short. But -- and a little bit of arm waving about why I think this is a really interesting story and an interesting company. Then we'll click down with Yossi, who will talk about strategy and priorities for Cellebrite, then we'll click down again into the 3 major functions with go-to-market, product and our financials. And I think the day might culminate and what probably will be the most interesting is you get to hear from 2 practitioners that are making our lives better and safer every day. And there's -- in my view, in these days, it's priceless to hear the real story of how people are leveraging Cellebrite to do good things in the world. So I'm going to start with a very complicated slide, so bear with me. And that is when -- I've been with the company now for roughly, I think it's around 9 months. And I still get asked pretty much every time, it happened already this morning twice is, Tom, tell me why did you come to -- after 42 years, what brought you to Cellebrite? Why did you come? And what are your observations 9 months in? I think the other question that's relevant today is, why should you care? Why should you all take time out of your busy schedules and invest half a day in hearing our story. And the good news is, the answer to both of those questions is totally aligned and the same. So let me share with you. And I would tell you that of the 2 answers to that question, probably the first one is a little bit more important to me than the second and for all of you as potential or existing holders. The second answer is probably a bit more, but I think both are hugely relevant. So the first thing and the reason that drew me here, I think what keeps a lot -- which drives loyalty with the employees and allows the team to attract the best and brightest in the industry is the fact that this is a mission-driven company. And after all these years of chasing capitalism in technology, which has been a great ride, as I entered my twilight of my career, I thought, wow, what better place to leverage all I've learned over the years and still pursue value creation but do it in a company that really is changing the world and making the world safer for all of us. And I have to sort of chuckle -- I guarantee -- don't guarantee, but I'll bet all of you have walked through an airport somewhere in the world, and you've seen some big sign that says, we're saving lives. And the subtext is, our routers or our blade servers are deployed in 91 of 100 hospitals. And I have to chuckle on like, okay, that's a 40-foot put to me. You're saving lives because you're selling servers to a hospital or to a police department. This is a company whose IP really is saving lives and making the world a better, safer place. And by the way, it crosses a broad spectrum, whether it's the schools your children attend, the community you live in, the cities, whether it's homicide, whether it's Internet crimes against children, sex trafficking, terrorism, all those vectors that I just mentioned are impacted by Cellebrite. So when I arrived in the summer, you immediately build this pride in the company and like, "I never heard Cellebrite until I came here." We've got to get the story out and tell it more, and let's work on our narrative. And so one of the things we did is we spent a lot of time with our constituents and customers and said, tell us about what we do, why we matter to you. And one of the themes that came across consistently is you help accelerate the path to justice. You get us from crime or case to closure conviction faster and more productively. And so we gravitated around a new brand promise and vision for the company of Justice Accelerated. And you will see that branding for the next x years as we move forward. So when you hear mission-driven, it's real and it's the main reason I came. Now the second reason, which is probably more important to all of you is I saw an enormous immediate opportunity for value creation. And you can do that in business. There's really 2 ways. You can grow, grow, grow. In some cases, they do it at any cost or you can squeeze margins and cash flows. Both work, both are actually easy to do, but I think the real winners and the real leaders in this industry are people that are able to do both. And I think what you'll see and hear the rest of the day is the job that this team has done in both taking market share, growing at a healthy pace while being good stewards of the balance sheet and the P&L and generating strong margins and free cash flow. When I think about a business and the sort of the ingredients or formula for success, I think about 3 things. First, is there an unmet or underserved need in the marketplace. On the flip side, you need a competitive or preferably best-in-class solution to address that need, and then ultimately, the team in between the ability to execute and connect those 2 dots. And so if you have all 3 of these, you've got the formula for value creation and for success. So let me take a minute now and take you through each of those 3 buckets. First, you could not have -- and this is really important. You could not have better, stronger, more persistent macro tailwinds than this business has. Why? Well, number one, the world population. Where is it going? Up. Crime. Where is that going? Unfortunately and sadly, crime is not going away and global peace is not about to break out. So more people, more crime. Three, raise your hand if anyone in this room that does not have some digital device with them today, raise your hand? Zero. Guess what? Bad operators are no different than you or them. And so the statistics show that there is some form of digital witness, digital DNA in over 90% of bad acts. So you've got population doing this, you've got crime doing this, you've got digital going everywhere with the criminals. And then ultimately, the old method of the detective and I'm old enough, I can talk about Columbo and Perry Mason and people that none of you recognize, but me, that used to get the fingerprint on the scotch glass at the murder scene. Well, nowadays, it's all about digital DNA. And so you cannot solve the problem with bodies. There's not enough budget at the sovereign city state level to chase the amount of crime. And so guess what you need? You need to solve that just like you solve general ledger issues in the day with ERP. There's a need for a technology-based platform to bridge that chasm between the volume of cases in crime and the limits of human labor. And so all that conspires to deliver a TAM today of about $16 billion with a 20% CAGR. The flip side is the portfolio, and we don't have enough time. I don't have time, but you're going to hear today from Yossi, you'll hear from Ronnen more detail on this. But if you wanted a 1 slide view of who, what, why where we are, this is it. So the vision of Justice Accelerated our platform, which is case to closure. And in the case of public safety, it could be crime a conviction and the 3 major product families that we're bringing to market and fueling our growth. And again, I'll let the other guys take you down a level on this so you can kind of wrap more understanding around each of the components of the portfolio. And then between on execution, you have connecting the dots. And you'll hear from Marcus today on go-to-market. So I won't share the details here. You'll hear from Ronnen on product and technology. The one comment I'll make is we are in the IP business, and I believe for 42 years that in technology, you win or lose with the best people. So our goal is to retain the best people we have and to be able to attract and motivate the best people in the industry. We continue to do that. You've seen examples in the last 90 days where we've added a Chief Revenue Officer, who you'll hear from shortly. Also on Monday announced the addition of a new Chief Marketing Officer, David Gee. And so this is a focus for Yossi and the management team to make sure that we continue to add the best people in the industry to chase after this opportunity. This is my comment about doing both that great companies can both grow and deliver profitability. It's not an aspiration. It's a current reality. You can see our results in 2023, delivered ARR growth of 27%. And by the way, we are not a start-up. This isn't a $20 million or $100 million company. This is a $300-plus million operation, delivering 27% ARR growth, which I think is solid. We nearly doubled the adjusted EBITDA last year from 10% to just under 20%. It's not smoke and mirrors. You can see the free cash flow generation tied to the EBITDA. And ultimately, on a full year basis, delivered a 46% rule of ex performance. That's interesting. You say, "Well, I already know that. I read your earnings report, and you're not telling anything I don't know." So I think the thing that is relevant is as we look at our business and look at those macro tailwinds I talked about and look at our IP and our portfolio, we are anchored on being a rule of 45 company for the next 3 to 5 years. So the long -- so in other words, the 2023 performance was not a blip or a recovery. This is a steady state model for us. We see -- we view the 20% EBITDA level as a floor with opportunity over time with scale to leverage and improve and growth rates in the 25% range. So this -- could we do better? Possibly. Are we committing to do better right now? No. But we're also committed to extending that Rule of 45 performance for the foreseeable future. So in summary, mission-driven -- by the way, I'm trying to move from back foot to front. When I got here, I started hearing stories about all the amazing things we're doing around the world. I said, why don't people know about that? Well, there's privacy people, and there's people we just don't want to paint a bull's eye on it, I said, no, no, no. We do so much good in the world. Yes, there's always going to be 1 isolated case of some bad that misuses the technology, but the amount of good we do for everybody in any democratized country around the world is enormous. And we need to start telling that story. So this is a company that not only is thriving financially, but is doing good in the world. We are leaders in innovation and technology and the investments we continue to make in that, I think, will protect that leadership position. We are delivering predictable, responsible, balanced, disciplined growth as we continue to grow the company, and this is and will continue to be a great place to work. So that's the kind of the setting of the stage. I'm going to invite Yossi to come up now and talk about the company's strategy and priorities. But before I do that, he won't do this because he's a humble guy. I've been here 9 months, I get no credit for the history of this company. I would tell you, I have seen in my career, people that are really good at inventing companies, entrepreneurs with good ideas, and it's a unique talent. I've seen people are good at taking good ideas from 0 to $100 million. That is a unique talent. Scaling companies from $100 million to $500 million and beyond, that is a different talent. And it takes a really unique leader to do all the above, and he's been here for 14-plus years. He could not have more passion about what this company is, what it stands for. He couldn't work harder than he does and deserves a lot of credit. So with that, I'll turn it over to Yossi.

All right. So thank you, Tom. Thank you for the kind words. And thank you all of you for joining us in our first Investor Day. And by the way, talking about people who are here with us in the room but will not present. Chief People Officer is here. Chief Strategy Officer is here. The leaders of the digital forensic unit customer segment and the leader of the digital -- of the investigative unit segment are with us. So there is so much knowledge here in the room. So I hope that in the demos and in the breaks, you will have the opportunity to talk with as many as possible. So when I think about Cellebrite. I think about the company with a clear and a unique mission and a company with an impact in the world. And I see us, especially when crime is on the rise, what Tom just said. Crime is on the rise as violent increase. We are -- Cellebrite is a safeguard, a company that operates and do everything in order to improve and create a safer world. And maybe on top of that, I think that we should look at Cellebrite as a synonym for safety, safety in public. This is why employees join Cellebrite, why they stay with Cellebrite. This is why customers are buying from us. And I would say that for investors, investing in safety in public, the best investment would be to do that with Cellebrite. Because, first of all, we are probably one of the, I would say, the company that gives the best solution to one of the biggest pain that law enforcement and private investigations has today in the industry. And this is how to access digital devices, what we call digital sources, digital witnesses in order to get digital evidence and how to manage investigations in the best way in the modern era. And within that, we are also dealing with, I would say, the 3 major pains that our customers are facing today. One is the increase of data volume and data complexity. The second one is how to deal with inefficient investigations. And the third, the ongoing pressure on our customers to do their investigation in a more ethical way and in a more accountable way. And we, with our brand and with our strong position, we help our customers to fight crime almost every day, almost anywhere where our solutions are being used in hundreds of thousands of investigations around the globe. In the last 15 years as we entered, I said 19 because we have done something else before. I'll talk about it in a second. But 15 years ago, we entered into this space. And there are so many examples, great examples that I could share with you of how our technology helped to create a safer world, solve crimes impactful, made a difference. Many of those cases were high profile in the news. But the question of what's going to happen or who's going to talk about those hundreds of thousands of cases, which say unfamiliar. What I call the real life and the real world of crime and protecting society. And I want to share one of these with you today. I'm talking about the case which happened a decade ago -- nearly a decade ago, 2016. Back then, my daughter, Ella, was 5 years old. Same age of the victim, probably made it a little bit more personal to me and I'll share that with you. But this is a classic simple case that shows how impactful our technology is by solving crimes and making a difference. 2016, a 35-year-old babysitter was found dead in a house in Minnesota. [indiscernible], the house was set in fire, she was murdered. She was babysitting a 5-year old girl. The girl was not there, gone. The police approached the mother. And the mother shared disturbing information related to the babysitter, and also shared information about an on and off boyfriend. The police did some background checks and discovered that the boyfriend has a past of sex offender -- or convicted sex offender. At that time, no sign for the boyfriend, no sign for the girl, the 5-year-old girl. The police approached to boyfriend's probation officer, and 20 hours after finding the dead body of the babysitter, he was invited for questioning. During the questioning, the boyfriend said he hasn't seen the babysitter recently, that during the time of the crime, he was spending time elsewhere in the state and that he hasn't seen the little girl for the last 3 years. The police released him after 4 hours, but asking to leave personal belongings, among others, his mobile phone. Immediately after he left, the special technicians, the police officers took with our technology, everything from the phone, hidden data, deleted data, available data. And from that point, they focused on 2 items, text and girl locations. They discovered deleted text between the babysitter and the boyfriend, planning to kidnap the girl. They also discovered deleted text between the boyfriend and another third person about the plan to murder the babysitter, kidnap the girl and hand it over to pedophiles, to sex offenders. From that moment, the role of the babysitter didn't play any difference. It was -- what mattered was to find the little girl. And the police also found on his mobile phone GPS location that showed that he had been in an area around about 50 miles south from Minneapolis. The boyfriend told during the interrogation -- during the investigation that he was fishing in an area, had been in an area, which is 50 miles south for Minneapolis. The police discovered that the boyfriend's family has a property -- own a property in the area where the GPS showed he had been. So they rushed to the area. They discovered in that area, they found tire trucks, which were matching the car of the boyfriend. They followed the tracks and entered into the property, left the cars and worked around about 1 mile into the area. They spotted in the distance a camper. The camper was locked, shut with electrical tape. Police moved the tape and slowly opened the door. And this is what they have seen tied to the bed. This is the 5-year-old Brittany, a girl, which was basically found alive and a girl that was found alive and saved by the police, let's not forget who the heroes are, but he was saved thanks to our technology. Thanks to our technology. Without our technology, this girl would have probably suffered and would probably died. And this is one girl, one girl which was saved, but there are so many stories like that. that show how impactful our technology is, and our technology make a difference in literally saving lives, literally saving lives in our community. And this is a story from 2016. The software that the police used back then is much better today, much more powerful. And the software and the product that the police use today is not only a stand-alone product, it is part of an end-to-end platform that covers the entire life cycle of digital investigations. And now as you can see how impactful our technology is, then you can understand, I would say, what drives us 15 years after we started this business of digital intelligence. What drives main person, what drives my team, and I can tell you, we are just getting started. Before I talk about where we're heading, let's talk a little bit maybe from a perspective of a co-founder about our journey so far. We established and found this company in order to take the wisdom from the mobile phone, all right? We analyzed already back then the power of these devices, the effect of these devices, the complexity of these devices and how impactful they are going to be on our life, these devices know about you more than you know about yourself. And we started to solve in the beginning one pain. We were that company who operates in more than 150,000 points of sales of mobile operators, enabling customers to get the service of transferring content from an old phone to a new phone. And later on, 15 years ago, we entered into a different space and started to solve another pain and a much more large potential business, as we saw that law enforcement agencies are using our devices in order to enter into mobile phones in order to solve crime. We basically -- and this is important, we grew our bootstrap something that shows about the DNA of this company, the ability to produce growth and cash and profitability at the same time. And in this business, the digital intelligence or digital investigations, we were not the first. We didn't create this market. We came as a mid strategy. But then later on, we showed innovation. And in a very short time after entry, we became the dominator in that space. And we have done a lot in several areas. In portfolio and technology, impressive accomplishments. We were the first company to deal with or to solve deleted and hidden data on mobile. We were the first company to solve encryption and unlock the -- entering into unlocked phones. And we were the first company to deliver the best in iOS and Android. And then we added more digital sources, what we call digital witnesses such as computer, cloud and so on and so forth, and progressed into multi-witnesses and multi-sources with Link analysis, added later on, investigative analytics dealing with large amount of structured-unstructured data, evidence management and case management, all that on the way from a point product company into a strategic platform provider. We started in the U.S. and expanded very quickly to Europe and to Asia Pacific. We started small with customers in the lab of police and then expanded to the entire digital forensic units, lab management, investigator, prosecution, agency management and all that while building our private sector, customers on large enterprises and service providers. While focusing on organic growth, we added and acquired tuck-ins in the areas of computer, collect and review and in the area of open source intelligence to expand our footprint within investigations. And on the ownership side, we started by ownership of a few executives. Later on, Sun Corporation, a publicly traded company in Japan, acquired 100% of the company. 2019, we added IGP, an Israeli joint venture or venture capital that supported our strategy that took us and help us to come to where we are today, NASDAQ-listed publicly traded company. All right. In terms of ARR, you can see that our business grew significantly in recent years, $92 million in 2019 to $316 million in 2023 and all that by bringing this great combination between growth in ARR, around 25%. This is what we're aiming and 20% in EBITDA margin. We delivered and will continue to deliver this area of Rule of 45. We'll talk about it in several occasions during this day. What drives our growth? What pushes our opportunity and our TAM? We are in a business of digital. So digital is meaningful -- the most meaningful part of investigations today, and we are best in mobile. Both are expected to grow in the next decade and as we heard already, unfortunately, so does crime. Our customers, on the other hand, they spend more. They have more budget to spend. However, at any point of time, they are living with a reality of constrained resources, need to do more with less. And that gives a place for disruptive technologies such as ours that comes to solve the pain of our customers. And in that case, to make them more productive. And we are laser focused, laser focused on making the flow -- the investigator flow of our customers more productive, making it faster, smarter and more efficient. And I'm glad to say that we are the company that years ago already discovered or identified the value chain in public safety. And there is a gap over there in this world between access, discovery, collaboration until one taken evidence to court. And we see here a great opportunity. First of all, an opportunity to improve the mode of operation of our customers dramatically. And then on the fly while digitizing their investigative flow create growth for Cellebrite which is a much bigger factor than what we have done so far. And I'm glad to say that after years of being best in digital forensic units in collect and review and in mobile, we finally stand with an end-to-end platform. We are connecting the front-end access that we do for digital forensic units with back-end investigative analytics for investigative units, and we do that with evidence management and case management. And this is an end-to-end for both in the digital forensic units, in the investigative units and in the streamlining between the both of them. And you can expect from us, the market can expect from us to come with more about the streamlining. And I would say that already today, but in the near future, that's going to be the best and the only end-to-end platform that covers the entire life cycle of investigations. And while we are doing a lot in technology and I'm not going to take from Ronnen's part, there are several focus areas, but 2 of them are going to be increased. One is cloud. I'm glad to say that public is ready for cloud. Private is, in any case, ready for cloud. And we are committed to deliver while maintaining on-prem, deliver our entire portfolio on a cloud and on a SaaS platform. And the second one, a major value for the investment, ongoing investment in automation and AI. We are doing AI, by the way, since 2016 as we started investigative analytics, but we are going to increase that investment. First, because it improves the mode of operation in digital investigation. And second, it gives much more meaning to our C2C case to closure platform. So let's talk about platform. And again, you've seen it already once, Ronnen will touch that as well. But here, what I want to say is the following. Our promise is reflected, I would say, our wish to close the gap in public safety is delivered by this promise of Justice Accelerated, and that comes into action with our case to closure platform. It is basically our vision to give an end-to-end and deliver an end-to-end platform. And it is also our wish and vision to serve both segments, private and public at the same time. There are 3 major flagship solutions and families of products. I'm not going to go into the details, but maybe in short. The insights on the left is our leading tool and the leading tools in the area of digital forensics and those are the best in order to enable examiners to finish an examination quicker than we need the other tool in the industry. On the other side, the Pathfinder. This is our family of investigative unit solution, reflected mostly by our AI-driven investigative analytics. And over there, it's -- the key is finding the golden evidence as quick as possible from a mountain of large structured -- unstructured and structured data. And in the middle, there is the flagship solutions, which are about the Guardian. Here, it's about digital forensic units, which are managing evidence and then sharing it with investors and with other functions within the organization. And the Guardian is a bridge. That area is a bridge between the front-end access, the insights and the back-end analytics. And the key here is the ongoing streamline and Ronnen will talk about it much more later on with cloud, with automation, with integration. And by that, also pushing, you can see on the left, more digital witnesses. Today, mobile, cloud, computer, we're going to add support in vehicles, video we do today already, drones, et cetera, et cetera. The principle is to ingest as many digital witnesses and bring them into this funnel of the streamline end-to-end platform. And who's going to get it? It's about our customers. And I can say with guarantee we have an excellent position within our customers and an excellent customer base. We have today run about 5,300 agencies in the public sector, around about 15 -- or more than 1,500 in the private sector, service providers and corporates. We are very strong in the United States, very strong in Europe, but still expanding. And the motion of the TAM is -- or the key in order to push the TAM is clearly to exhaust the maximum out of those customers in an element of land and expand. And I'm glad to say that the hard job, when we went public, we told that already to the world, we have done the hard job of land. We are sitting in most of them, PDs, state and local government, feds, et cetera, et cetera. And we are steadily expanding within this customer base, learning their mode of operation, their pains, their needs. The good news, we are underpenetrated. We are yet underpenetrated. First of all, if one look at the potential buying centers and professional centers, which can still buy either Insights and/or Guardian and/or Pathfinder, not to mention the streamlining. It's about the fact that the law enforcement -- especially law enforcements are spending a fraction on us. Dana and Marcus will talk about it later on about this fraction on spending on us and the ability for us to increase price because this industry embrace value and embrace value selling. And then that pushes clearly an amazing opportunity for a motion of cross-sell, upsell within these customers, more from that by Marcus and Dana. Our growth is going to come from these 4 elements. And I would say 3 segments, 1 inorganic, I'll skip and leave the cloud and the platform element to Ronnen. And maybe -- well, leadership in digital forensic units. I'll start calling it DFU, leadership in IU, expansion in private and M&A, and I'll talk shortly about each one of them. As for the leadership in DFU, first of all, we have an amazing opportunity that we had created. We have an amazing strong installed base of more than 28,000 licenses. And we are going to leverage on our new revolutionary Cellebrite insights that combine capabilities of many solutions that we're offering fraction and parts. And we are starting this cycle of upgrading this installed base. On top of that, finally, end-to-end offering in the DFU combining front and access with evidence management. And clearly, the need and our ability to improve efficiency of the digital forensic units by making them more productive, again, smarter, faster and more efficient. The IU, the investigative unit is going to be an additional attractive growth engine for Cellebrite. And I'm glad to say, since the beginning of 2024, just one more than operational. We are managing this segment with dedicated teams on both sales product house and marketing. You will hear more from that -- you will hear about that more from my colleagues. And here, there is an amazing potential opportunity, thousands of high crime units within our logos, which are willing and ready and have the need to get investigative analytics in a format that we offer it. We identified single-digit penetration so far and an expected growth between 35% to 50% year-over-year. On top of that, we are bridging DFU to IU with Guardian. And here, we are going to leverage on already more than 0.5 million investigators that we identified, which are using the outcomes of our Cellebrite insights, and we're going to monetize on that. We are going to leverage on our AI existing capabilities and have an amazing opportunity to make a difference here and to differentiate from others. And last but not least, also here end-to-end, back-end analytics with evidence management, what makes it more efficient for our investigators to close more cases and close them faster. In the private sector -- the third one -- the third engine. In the private sector, it's about do what we do best. And this is collection as part of eDiscovery. We are going to dominate and expand within the arena of advanced collection and advanced remote collection. We also listen to customers and in a perspective of, I would say, 2026, 2027, develop the approach of building tools -- SaaS tools for multi-use cases, multi-data sources multi-users, and this is something that can make a difference for us. And we are also going to expand, and I want to say something about our private sector, which is a little bit less than 10% of our business. We have an amazing customer base over there. The top Tier 1 banks, the top Tier 1 insurance companies, [indiscernible], the top service providers. And over there, we have an opportunity to expand within those accounts, but also expand the account base organically and maybe inorganically. And talking about it organically, first of all, I want to say 1 thing which is clear. We have an amazing opportunity, and there is enough meat to grow organically within our space. All right? Enough in order to grow organically. Nevertheless, in order to accelerate, we do see the inorganic element as important as we did already twice. And we are going to focus here about 2 things. First of all, we have, you could see $330 million in our balance sheet in cash, so we can do many things and it's on us to decide when and how. Tuck-in technologies is one option, and this is to accelerate the motion of cross-sell and upsell. And on top of that, interesting adjacent that could help us to expand our, in any case, attractive TAM. These are the key initiatives and the key investment that my colleagues are going to talk about, okay? I'm not going to touch it, but those are the key initiatives and the key focuses of the company. One, the C2C platform, the most comprehensive offering, Ronnen will share with you about AI, about cloud, about research, go-to-market excellence, the best and the largest sales team in the industry, Marcus Jewell, CRO, is going to share about that more. Every company will tell you that everything is about people. I'm telling you -- so I'm telling you as well, it's about people. But I'm telling you that in our building, there are things which are being done by people that you can never -- that you cannot find elsewhere in the world. We are doing unique stuff in our talents in the area of not only sales but in research and development and in product and in marketing. It's a talent-based industry. And I'm glad to share that at least from my team, if you look at what we have done recently, Marcus Jewell, CRO, joined us in Q4 2023. And -- where's David? Here's David. Pleasure and good luck. I'm sure that all of you have seen the PR on Monday David Gee joined us as Chief Marketing Officer. And on his shoulders, all of us, there is the element of best brand awareness and brand excellence and marketing excellence. Dana will -- and by the way, talking about people, Zohar Tadmor over there, Chief People Officer. See that everyone can see you. She will be able to share more about our talents and our talents policy and where we're heading in that direction. Dana, financial excellence will cover the elements of Rule of X, what we covered already. and cash and so on and so forth. So with that, I'll come to an end, and I would like to say the following. First of all, we do good in the world and we do that big time. I would say that -- I always say that the world, one, needs Cellebrite. The industry needs Cellebrite. And if Cellebrite wouldn't exist, one need to urgently invent it because of our meaningful and critical role in investigations. We continue to deliver value and we are committed to this mix between 25% ARR growth in the next 3 years and 20% EBITDA margins, the Rule of 45. We are operating in an attractive TAM and we're going to make it -- we're going to make ourselves bigger within that environment. And we are definitely the leader in technology and in innovation in our markets. And the good news is that we are just getting started. And talking about getting started and after reflecting, I would say, the growth engines that have listed, DFU, IU, private, M&A, cloud platform, talent, brand, C2C platform. Then we have all the growth engines in the company today. They are ready in order to accelerate, win an excellent and attractive market and create the path for a $1 billion ARR company in the mid to long term. And with that, I will -- I'm coming to an end and questions or we continue? Thank you for listening.

So I do think we have a handful of minutes for some questions. So we'll take a poll, and it looks like Jonathan has got one.

This question is for Yossi. Just wanted to understand, just given you have this Rule of 45 target, you also showed a slide where you've won many of the large agencies that are out there. Can you give us a little bit more color in terms of understanding how do you continue to grow at these rates when you already have won so much of the industry and maybe a little bit more granularity around whether that's going to come from expansion of products or additional seats that you're adding?

There is a clear -- I don't want to call it a perception that when a company sits and well based by the accounts then there is, so to say, a saturated environment and then the question is clearly how one is going to grow. And I think that we are showing already for several years by now that although we are sitting, we hardly had any logo in the last 3 years. And still, we had almost doubled our business size ever since we took public in terms of ARR 3 years ago. And it's -- the motion of the growth is mainly based on adding new solution. And in that context, by the way, new seats. Collect and review is expected to grow 20% to 25% year-over-year by adding more seats, more users. Then on top of that, investigative analytics, 35% to 50%. And over there, we have the logos, but we have so many, you can call it sub logos within that account, which are underpenetrated. And we haven't basically approached the met in order to place investigative analytics solution and also collect and review. And so goes to the evidence management, which is, by the way, a smaller part, but it's going to double its size. And that, by the way, will strengthen the motion of both collect and review and investigative analytics. So it's selling more solutions, it's selling more seats, and it's also related to, I would say, price increase based on the value that we are adding to our solutions. So those are the, I would say, 3 or 4 main motions. Dana, would you like to add? Thank you, Andy.

And Jonathan, thank you for the questions. I will further elaborate it in my chapter, and we'll speak about our growth model for the coming 5 years. But I would say that Yossi spoke about increasing crime and the fact that digital -- crime becomes more and more digital, expanding our -- the capacity of our customers to cope with such a large increase is a great opportunity for us to grow. And this is the same installed base that we are sitting to now, that will just need to cope more by adjusting to the fact that it's becoming digital. And I see that you...

I'm going to get a workout room going from side to side here. Hugh Cunningham with TD Cowen. First of all, thank you, Yossi, particularly for the commitment to the mission that you described in the beginning of your talk. So I have 2 questions. The first one is you talked about tuck-in acquisition -- acquisitions as a way of accelerating cross-sell and upsell. It would seem you have more opportunities on the commercial side, be my guess. Given your substantial penetration of the public sector, the opportunities would be on the commercial side. So that's the first question.

Well, first of all, as I said, we have enough to grow organically, right? And the importance of the tuck-ins in that case, I would say, is to make sure that we are either in cases that it will take us time to bring something to the market, time to market. Or in the case that there are elements in our C2C platform that we are -- we cannot do it in our size, we do not need to do everything by ourselves. So in the context of while organically, knowing that we have enough opportunity and enough meat to grow commercially, it's about strengthening the organic story and the C2C platform with tuck-ins that can enable us to accelerate. It can be on cloud, can be in investigative units, et cetera, et cetera.

Okay. And the second question, I'm hoping to bring this out of left field maybe and surprise you. So you talked about AI and particularly in the context of Pathfinder, I think you sort of emphasize that. But have you thought at all about quantum and how quantum -- there's been discussion of that. It sort of faded in recent years, but how that will impact your business?

So we can do 2 things. We can use the energy and talent of Ronnen right now or we can save the answer to your question for his part, if you're okay with it, and that would be probably the best thing to do.

Okay. We had time for 1 more.

Yossi, you spoke about the fact that over the last few years, most of your -- you don't have new customers or you have a few new customers. what prevents the company from getting new customers? Is the market fully penetrated? Or do you need a different motion in go-to-market or different kind of channel partners in order to address new customers?

I would say the following. We are focusing, I would say, 60% to 70% of our growth on existing logos, but within those logos, we have so many new customers to grab. If you look, for example, about a 3-letter agency that I visited last week. They have 32 offices around the U.S.A. We work with only 5. And even in the area of DFU, these are entities that needs basically to deal with backlog, need to deal with all the pains and they wish to open labs. So only on the DFU I've got 27 new or 27 new customers that I need to grab within that logo. So it's about the fact that we have the logos, but there is so much in terms of new customers that we need to grab. So the expansion is a norm. So first of all, there is nothing that prevents us. It's only on us. I'm glad to say. And by the way, let's not forget that the good news is this industry is a multi-vendor industry, and they buy a lot from all the vendors. The question is, obviously, who is the primary, who is the secondary in each one of those areas, Insights, Pathfinder and so on and so forth. So I would like to correct the perception here. We are acquiring new customers almost every month, almost every week, but we are doing that a lot in the same logo, all right?

So I think with that, we'll move on to our next presenter. And I'd like to have Ronnen Armon, who's our Chief Products and Technology Officer join us.

Good morning, guys. No matter how many times I hear the Brittany story, I'm moved again and again. So thank you, Yossi, for that. Hey guys, I'm Ronnen Armon, and I'm the Chief Product and Technology Officer for Cellebrite. Like many others in the company, the mission statement of making the world better and safer played the big part, me in joining about 4 years ago. Every day, our world becomes more technological and humanity is great in embracing technology. Unfortunately, for every good invention, there will always be someone who'd exploit it in a bad way. But with the abundance of sensors around us, they are likely to leave a trail -- digital trail. That's why many investigations today actually 90% of them turn to be digital ones. Cellebrite is on a mission to accelerate justice and we plan to do so by modernizing and transforming digital investigations. I'm proud to lead a 400-strong professional organization, probably represent maybe the higher investment in our industry domain. I might be biased, but I believe that what distinguishes great companies, technology companies, is the engineering talent that we have. And I think that we have the best. We handpicked them around the globe. So we are globally spread. And we have a big center in Israel. Every place is known for something. So Germany is known for its great cars, and Italy for its pasta and France for its wine. Well, Israel is known for its cybersecurity scene, and we grow heavily from that talent pool. Our solutions are deployed in any sizable organization in the Western world and our ties with our customers, keep feeding our innovation first with new pains and challenges. Our domain expertise is really unmatched. We are dealing with the most complex, most vital most evolving data. We make it accessible, we make it human readable, we make it actionable. And we always make sure to stay 1 step ahead in terms of the latest aggressive technologies, that's why we've pioneered with data acquisition methods, with collaboration, with analytics, with machine learning and AI. Today, after some kind of like context setting, I'd like to focus on the growth potential as I see it from a product and technology perspective. Let me establish again the importance of the digital evidence. In the past, the adjusted system relied heavily on human testimonies, sometimes on physical evidence like fingerprints and DNA. But these are not always exist. And honestly, in many crime types, they are not even applicable. So you end up with juries sitting in courts debating subjectively the validity of the case. Now that has all changed as our environment became so highly digital, with so many sensors around us in the mobile phone, the king of sensors. Now 2 things about digital evidence extracted from a mobile device. One, it's undisputable. And secondly, it answers all the W questions as we like to call them, that investigators have like what happened? When did it happen? Where did it happen? Who was involved? This concept is true in both the public and the private team. Think of the case to closure life cycle as a factory, a factory of justice, a production line of cases through which the currency that go through that is the digital evidence. We identified 3 bottlenecks in the production line, how to lawfully acquire an evidence, which is admissible at court? How to collaborate securely between the different stakeholders and how to analyze cases and bring them to closure. These 3 bottles map nicely to our portfolio and our ambition. I'm going to talk through them one by one. If you think about the most famous cases of our era, a case could swing and be won or lost over a single evidence. Now what's interesting is the evidence is always there. It might be hidden behind pass code and locks might be even be deleted intentionally maliciously. Often it's complex, hard to read. But making sure that no evidence is left behind and it's admissible in court are prerequisite for digital investigation, that's exactly the job of Cellebrite Insights. Onto collaboration. In a typical case, there would be 5 parties at least involved, investigator, examiners, analysts, prosecution and defense. And it's critical that evidence reach the right stakeholders as early as possible. Statistics show that given a major lead if it doesn't reach the designated investigator within 48 hours of being found, the chances of closing that case drop by half. Another aspect of this area is retention of evidence. And that could vary between the crime severity, it could be a year, could be eternity. Cellebrite Guardian is about automating the flow of evidence to the different stakeholders while keeping chain of custody, hopefully, is a nonterm and adhering to retention regulations. Last but not least, finalize. You'll hear it today a lot. As volume of data drive up investigators and prosecutor have hard time to make sense of all of it. How to really build a complete picture with the exact time line, sequence of events, the social circles that we have, the relationship with others, these are all super critical to advance the investigation. There is something unique about the phone as one of the digital witnesses that it's a window to our solid our intentions. What did we go online to search for? Who do we follow? What we plan to buy? Where we plan to travel? All of that is on the phone. Cellebrite Pathfinder addresses exactly that bottleneck, which brings us what you have seen today already a couple of times, which is the Justice Accelerated vision. It's a vision that we align our entire teams around it. But maybe more important from my perspective on the product side is what fuels it, which is the platform underneath. And that's the case to close the platform. This platform is what our customers needs. That's our vision. We were first to introduce end-to-end digital investigation platform to the market, and we're going to keep evolving it as time go by. Now that's not necessarily to say that every line of code that we have sits exactly on the same technology stack. But this is our north star. This is how we plan our road map. And every morning, an army of innovator are waking up to make that vision more real for our customers. Let's spend a couple of minutes about the marketplace we operate in. Two good news about this slide -- about this chart that you see here. On the 2 dimensions that our customers care most about, which is the depth and the breadth of our solution, we're in a leadership position. We know I got that question earlier before we started. We know the data that our customers know about the most. It's not just about getting access to it. It's really to know it by heart. And we know how to drive it through the entire life cycle of case to closure. The other piece of good news is that we're not alone. There are other vendors. They might be delivering point solution. They might be delivering pieces of it certainly on us to keep leading this space. The rest of my commentary, I'd like to dedicate to the growth potential, as I see it from a product and technology perspective, and it's about 3 areas: advanced evidence acquisition, cloud and AI. Now the importance of digital evidence is just going to grow up -- is just going to increase. In the typical phone, you might find 50,000 images. You might find hours of audio content. Many, many messages, hundreds and thousands of them. Every month, the typical user, like all of us will add another 5 gigabytes of data to the phone, every month. The challenges of getting access to all of this data, understanding it, deciphering, making it readable are going to the same way we increase as well. And this is a huge growth potential for us. Yossi mentioned this as well. It's our bread and butter just with another be clear of butter. That's how I think about it. On burdening our customers from IT and security concerns, providing them elasticity, leveraging, running workloads through the cloud more than collaboration. All of these pose kind of like another big layer of value that could come with a big spend increase. And last but not least, harnessing AI for more automation, more efficiency, especially in a resource-constrained environment, again, will deliver another wave of value to our customers with a matching additional spend with us. I'm going to take you through this one by one. So Cellebrite is the de facto standard in mobile evidence acquisition. The gray plateau that you see here represent the 30,000 licenses, 30,000-plus actually across public and private sector. The height of the gray bar represents the value and the matching spend of our basic offering. As the world becomes a bit more complex, more evidence, more data, more challenges how to get to that, how to make sense of it got us to introduce in the last couple of years an advanced version of our solution which we sold for a premium price. Now by the end of '23, that solution was deployed around 20% of our installed base, denoted here by the toller orange bars. Now starting in '24, we are redefining the standard of mobile evidence acquisition. Actually, of digital forensic. We expect that our entire installed base as additional customers to adopt of that solution fully over the next couple of years. What our customers get? Much more data, more digital witnesses, more automation, more streamlining, and we expect that to translate to a big spend with us. So that's 1 growth vector. Cloud and SaaS are a major focus for us. When someone think about today about sensitive evidence and cloud, it almost sounds like an oxymoron. But I'll take you back 15 years ago, companies were hesitant to put their CRM data in the cloud for the same reason. Today it's best practice. We see, by the way, that favorable affinity towards cloud in the private segment that we run. But in the public sector, that reality, I would say, conservative reality still persists. IT heavy shops, high CapEx cost, a lot of attention that goes to the wrong stuff. On the other hand, cloud infrastructure and services have matured tremendously and the benefits that cloud brings cannot be ignored anymore. I proceed that in the next several years, we'll see a major shift to cloud-based services. Now we definitely intend to remain ahead of the game here and offer the solution to these emerging market needs. The way I see it, again, from a vision perspective the justice factory that today is predominantly on-prem could be completely migrated to the cloud. You are familiar with probably with cloud benefit, but what matters to our customer, the value drivers, a lot is about sharing digital evidence securely among stakeholders. It's about accelerating compute-heavy workloads with cloud elasticity and gaining better insights with AI processing. Now what's nice is that this is relevant to all segments. Even those that we consider very sensitive one, like the Federal segment, which is on program of FedRAMP or MOP in the U.K. and other countries as well have emerging installs to cope that because everyone wants to get a piece of it. Cellebrite is best positioned to deliver end-to-end digital investigation in the cloud and oversight we plan to lead the game. Recently, I get confused when I hear so many companies trying to whitewash themselves with AI as if it's a new thing. Well, not for us. Maybe I want to give you a kind of like a past, present, future perspective of my own. What you see here on the left is the content of a typical mobile device, 50,000 images, millions of messages, many check parties, social applications, et cetera. Back in 2016, [indiscernible] that the complexity and volume exists on that device are just too much for investigator to comprehend, to make sense of. And the only way to cope with it is leveraging machine learning and AI. So we introduced back then in both our analytics and our forensic solution, the first capabilities. For example, classifying images by predefined categories like weapon-related, money-related, drug-related. The impact on the investigator is like going from need to review thousands of images to just view dozens of them. That's a huge efficiency gain. Same with the topic detection. Think about someone who would like to assess where there is gang activity going on and a lot of messages. That's again, it's a machine learning technique that made that job of like redefining these categories much easier for investigator. Later on, we actually gave the ability to train the models to our customers. So they can come up with new categories that we didn't think about, but matter to the cases that they are working on. This classical machine learning approach is still relevant. Think about the audio content of today. If you have kids, probably you have noticed that in the last couple of years, they are exchanging messages which are voice-based, with their friends rather than typing text, I know, I get it from my kids. Think about from the investigator perspective, now the need to peruse kind of like all your content, hours of it. It could be a nightmare. Look at this alternative approach using AI-based speech text. Hopefully, we have an audio. [Presentation]

I picked that clip because of the heavy accent use, but guys think about it. The ability to take that. We delivered that last year, along with more than 60 languages -- translation from 60 languages. What it gets investigator is 2 things. First, all of a sudden, they actually have access to a lot of digital data that they were practically blind of -- just practically, they couldn't go through so much. And second, it's much, much more efficient. So that was -- if that was kind of like past and present, let's see what's coming soon. I'm sure you all heard about Gen AI, kind of like very -- became very topical in our life in the last couple of years. But what you might don't know is that the digital investigation world work actually involves a lot of content generation that could be in submitting warrants, in filling up forms, in putting the case narrative together. Let's focus on this one for a minute. Putting the case narrative together means that you actually want to tell the story of the case while incorporating the hard evidence into the story. What you see on the left-hand side is what we call a raw event. There are millions like that on a phone. Basically, this one is about an SMS message sent from one Wade Wilson to Marsha. What the investigator would like to do imagine that they'd like to incorporate that in their case story. They'd like to tell that thing to the judge to defense, et cetera. They'd like to get something like this. Usually, they take it away. What's nice here that it came completely out of the machine, a great draft. And all the bad stuff that you hear about Gen AI, biases, hallucination, et cetera, completely eliminated because what you have is just translation to plain English, something that investigators do in the thousands, like on every case, that's huge in terms of the efficiency gain and that's coming in our solutions this year. They'll get to more like the new future. And here, maybe I want to share with you we are meeting many investigators on a daily basis. And eventually, as they try to interrogate the body of evidence, they are asking very simple questions. They'd like to know when 2 people discuss something, who mentioned first, a topic, who mentioned maybe a sum of money, things like that, that's how they work. And what we do as vendors, I'm speaking to Royal, we dump on them very sophisticated software with many filters and UI, et cetera. And no wonder that only a portion of them can master that out of interrogating the evidence. So we built proof of concept here that kind of like bring a Cellebrite assistant and allow investigators to work in plain English interrogating the evidence. I'll try to explain what you see here in the short video. So I'm now interrogating the evidence. And there is this lady Evelyn, which is my suspect. Now asking the Cellebrite assistant. Tell me who did Evelyn was in contact with on a specific date. The assistant comes back and marks 3 folks, one I'm particularly interested Snow White. So I ask give me a summary of what Evelyn did discuss with this Snow White guy on that date, and I get the summary. And the summary hints to a shady deal going on something about drugs. So I said, take me back, please, to original messages that actually made the top summary. And I go back in a matter of seconds to the original messages that you've seen in a second and voila, I get to exactly what I need. And you can imagine, take that one step further, that could be completely voice-commanded and what used to be going through many screens, putting filters on the dates, et cetera, and making all the searches, all of a sudden available to many more investigators in plain English much faster and that could be our future. That could be the future of digital investigation. Guys, with this, I'd like to kind of like summarize the takeaways that I'd like you to take from this session. First, we're building a great case to closure platform. We're putting that end-to-end digital investigation. And on top of it, we see 3 exciting growth vectors from a product technology perspective, redefining the standard of evidence acquisition, migrating a lot of on-prem workload to the cloud with a complete cloud experience and reshaping the modus operandi of digital investigation watches us so. As our life becomes more digital, our customers would like to solve more cases, to solve them faster. We're going to be there for them, and we intend to lead the pack. Thank you, guys.

All right. So I think at this point in time, we will be taking a short break, have about 15 minutes or so. So I would encourage you all to -- if you do have -- if you are interested in product demos, we can show them in a short form, sort of ad hoc and we'll reconvene at about 10:10. [Break]

All right. We appreciate everybody's attention. We're going to get the next part of our Investor Day underway, and we're fortunate to have Marcus Jewell, our Chief Revenue Officer, join us, and we'll get that started now.

Thank you, Andy. So thanks for coming back. So probably good to see you all here today. It's always great when you're the CRO or call myself the sales guy at an investor conference because it makes the CFO squirm because she's panicking now that I'm going to commit to something, which isn't it, but I promise you that I won't do that. So a little bit about myself. Marcus Jewell, I've been in tech sales for 28 years. I know I probably don't look old enough, but I obviously got into very early. And I got the privilege of being CRO in 4 different companies. So I was actually the CSO of Brocade, where we got Broadcom, I was the CRO at Juniper through its very big growth phase. And lastly, I was CRO at CSS, which is Travis Kalanick's startup in the cloud kitchen space and helped him form that company and get that off the ground. And then being in the company now here for 4 months. So I run all functions in go-to-market. So sales, presales, advanced services, customer support, technical support, training, field marketing. So every part that touches revenue reports up to me. And it's been a blast, and we'll come on to that a little bit later. I should also welcome David as well. So David is going to be my partner in crime. He's another Brit. So it only takes 2 Brits to form an empire. So everyone's got to watch out. I resident in the U.S., by the way. There's a lot of questions about. No, I am resident in the U.S. okay, legally as well, which is good because the DEA here, so I just want to point that. Well, we're not going to get into that. Let's not do this audience. So I want to put some context around what we've already heard today and talk to you about why we are positioned for what I call for sustainable growth. There are powerful industry trends. So we answered it a little bit, but don't put more context. Mobile phone data set to double in the next 6 years. So even the doubling of the mobile phone data puts pressure and allows us to upsell the licenses we already have. The usage increases, the number of people that get access to mobile devices increases. So there's almost like a self-fulfilling TAM growth model within our base. And I also think we have a base to go at, and we'll talk about that later. I do think there are net new customers when we expand our coverage model, which I'm doing that we can go at to take it to the next level. We have a compelling value proposition. As a CRO, what you really need, the best one is you have a happy installed base and you have a new product which has extra value and extra price. And I think we're modeling that our new product insights is coming at around 20% increase to what we do, and the customers are happy to buy it. Now you've heard a lot about the demos and I'm going to play on your heartstrings, I compel you to see the demo. You will or somebody you know will be affected by crime in their lives. I think it's on you to understand who other people, other citizens, decide to protect us. And you should understand the tools that they have at their disposal we provide to do that. Because if you don't go to the demo, it means I think you don't care about people, and I'm sure you all care about people. So I'm just going to put the heartstrings out there to say, you need to go and see the demo. It's super cool. And we're making strong investments in go-to-market and all aspects of go-to-market about customer service and sales, and I'll talk about in actual specificity, how we're going to make those investments. So what's our market opportunity? Well, first of all, there's a digital transformation happening, and this is public safety, in particular, is a little late to the party on digital transformation. These are the slides I used to do like 15 years ago for enterprise or finance and these kind of things. But what's happening now, the National Police Authority, I don't know if you know, have set a goal to have 80% of all applications that law enforcement use in the cloud, 80%. This is a new thing and we're going to talk about how we're going to take advantage of that. Public safety demands increase. The digital out of facts that we collect only become more and more important. This is not going away. I'm not -- we can overemphasize that point. But I think we need you to leave here knowing that these problems are not getting away. They're getting harder. But let's not forget about our enterprise business, internal investigation in the enterprise. I'm sure a lot of you here have a compliance department for who you work for. Is compliance getting easier for you? Is your compliance team growing like gremlins? Every time you turn up, there's another one, like you know when they get wet, more than breed because it's important. And so I can almost guarantee from our installed base, and we have an unbelievable installed base in the enterprise. I can almost guarantee that the majority of the people in this room, compliance departments, legal departments, both using our devices at some level to extract information from corporately owned or bring your own device cell phones, whether it's through a service provider or your own use. And I believe that we have a compelling argument there to not only increase our penetration, but we also have some price leverage as well. And we're going to take that forward as we expand. And the most important part of this slide is don't assume how police are making decisions. I was with a customer actually in the U.K. I thought it was U.S., it was U.K. and the person in charge, the detective in charge, the superintendent was a Masters in Computer Science. He wasn't criminal law. He was Masters in Computer Science. This was a person that knew investigating in digital and investing in the digital was the way forward to solve crime. It's no longer, I want to go and buy guns or police or armor or something. There's a much better market opportunity for us to take wallet share from some traditional policing areas because the need of solving crime digitally is so much more efficient. And again, I do into this. So let's look at how traditionally things. And I like the way that Tom talked about Columbo and these kind of things I listened when I used to grow up when I was pretending I was in and off school that used to be on in the afternoon. I don't know if it's the case in the U.S., but in the U.K., it was, how crimes are traditionally done. And the meter point of this slide is very simple for you guys to understand. The top in the blue still happens, police work is incredibly important. There is instinct. There is need and you're going to see here for some fabulous customers going to talk about these things still happen, but the top is so expensive. It's so expensive. The way that we demonstrate our IU software, our Pathfinder software is we go to customers and we go give us a tricky case that took you a long time to solve. Because they've extracted the data that exists and under chain in custody that data has to be kept for a very long time, and let's put it through Pathfinder and see what happens. Westmead's police, big drug case, serious crime. We put it through Pathfinder and I think we reduced the time to charge by 6 months because we found a Snapchat conversation, which is all they needed to prove that the single person they were trying to get, this drug load was in the place of where he said he was with the right person. Six months. We can't even calculate the cost of that was of all the fuel, policing, searching, warrants, paperwork. So what you're now seeing is to solve a crime digitally is the primary way to solve a crime. It is much easier if you don't have to do the physical and our customers will be hopefully talking to you about that later on. So where are we? Everyone has to talk about the transformation. All markets continually go through transformations or evolution is a better word. So we're way beyond experimental and siloed for the technology we have. Police forces rely on it. We are now in this aligned area and the growth of our platform, and we are the only platform that can take it to a completely optimized solution. We now have people that can take from extraction to charge in a faster time than they ever thought possible. This will be the driver of our business over the next 3 to 5 years. This will be the standard that not only the minority of police forces and law enforcement and agencies take, it will be the majority because the data extraction alone is getting too complicated. We have to assess, process, analyze and reduce that time to charge. Now something slightly controversial. Everyone gets worried now when I say that, but trust me, it's not numbers. We don't solve crime. It's not what Cellebrite does. We actually serve those who serve others, okay? We have actually reduced the time to charge. We reduced the time to charge. And time is everything because time is cost. If we can reduce the time to charge, more cases get cleared, public safety increases. We are effectively a speed paradigm. And the way I look at us, the parallel markets are the observability market. If you think about what Dynatrace or Datadog, and I've seen some nodding heads, so I'm glad this analogy is working. They really get into root cause analysis of a load of data fields, so you can make good decisions on your infrastructure. We're getting to root cause analysis, so you can actually charge a bad guy and get them in. But the process is roughly the same. And we believe that we can become that platform and wouldn't it be great when Cellebrite becomes the Datadog of the public safety world. That would be nice, because I think our valuation will be very, very nice. So why do we win? Well, I'm going to put the cliche up. We're a trusted partner. I don't know how many of the analysts go to different companies, and we're a trusted partner. Let me talk to you about what trust means. Trust here means we get letters of commendation hand written from Chief of Police. I've never seen anything like it, literally handwritten, thanking us for what did. I'm an immigrant to this country, and I have the pleasure of going through border control quite often. And usually, when I used to go through 1,000 questions, what do you do, why are you here? What does Juniper do? What does cloud kitchens do? You have this horrible thinking, "Oh my god, I'll be pulled the side and questioned again." As soon as they see Cellebrite on my paperwork, thank you, literally, 3/4 of a time, thank you. I remember when I was an agent. I remember extracting on your device. Thank you for what you do to us. I have a pleasant experience going through border control. It's unbelievable. TSA not so much, but I'm not going to get into that, but border control is fine. The other thing you need to understand is like here's how we work. You want to remember during the evacuation of Afghanistan. That was kind of a mess. It was obviously trying to save a lot of innocent people. And I can't remember how many thousands turned up that had to be evacuated. Citizens obviously, refugees looking for asylum, innocent people that were caught up in that horrific situation. Now unfortunately, what happened amongst that, and that mad evacuation of the U.S. sponsored was a lot of not necessary factors would have appeared pretending to be the mother, the father, the daughter or whatever of the innocent people they're getting on. And so we were called up very quickly. They actually were processing the mall in D.C. out of an air base, I believe, is it?

The Dallas Convention Center.

Okay. In the Dallas Convention Center, and they said, we need help. We know there's going to be some bad actors in this place, can you go there. We were there within a couple of hours with the technology, we're not charging for this, with the team and we found 3 top-level terrorists, not minor. These are top level, who're going to do very, very bad things. That's what trusted partners do. And that's the way that we want to operate going forward. And we have countless stories like that. We're the only end-to-end solution. I'm not going to go on about that. It's pretty clear. What I'm going to talk about is super exciting is global partnerships. We have both technology partnerships to make sure that our solution is end-to-end. And you've probably seen announcements with companies like Chainalysis relativity, which really helps us get to the next level. And that's going to be a big investment area for us. And I'm pleased to announce that I've hired the first global leader, which I'll talk about later, for partnerships in order to formalize and make a much bigger play for us. But a partnership is misunderstood and people say don't use AWS. Amazon partnership is very tight with us. Amazon have huge aspirations, as you know, in the public safety market. When they hear 80% is going to move to cloud, they get excited. They know how critical we are as a piece to that. So not only our partnership is go-to-market with them and taking that forward, but also the ability to work with them to deliver our technology through virtual connections and our journey to cloud and journey to SaaS, which is incredibly important. So those partnerships are going to be great for us. And then go-to-market investment, which I'm going to cover now. So here's the TAM. What do we want to point out here a nice spread. We have plenty of TAM to go into. We're not going to run out of a total addressable market. That's not a thing for us. The ARR growth is nicely balanced. Dana covers us a little more across the world. And then there's huge areas of the world, which are black. So everywhere we operate, we feel we're in a leading position. But ethically, morally and prioritization, there are certain areas that we don't want to operate in. And we're very clear on that from our ethics policy. So where we operate we feel we can lead and continue to expand. So the go-to-market team. So how much would we spend? Well, the good news is, when I came into the business, we actually had a very, very good sales force. Most of the processes were good. Most of the people executing were at very high efficiency, and our efficiency numbers are, I think, in some of the backup slides. But we were fragmented because like most companies, when you scale up, you do it from a geographically centric way. That's the way you do it. It's very hard to have a command to control when you're under, I don't know what the numbers, but a few hundred million. But when you get to the scale we are now, there's all be efficiencies in globalizing the team. Now what does globalizing mean? It means that they don't need to replicate resources across the world. It means I don't need necessarily as many sales operations people, business development people, those kind of roles, which are critically important. I don't want to diminish them, but they're not quota carriers. I was guided by very wise people, and the only thing that really makes a difference to a sales organization is how many reps you've got and how long they've been in territory. That's it. And you know that. If you're looking at and the company says, I've got to replace 100% of my reps I'm going to double my team and get full productivity in a year. I'm not sure your models stick. So what I'm pleased about is our attrition of individual contributors in sales is incredibly low. I mean, almost unmeasurably low. So we're keeping the core of the people here and adding to the DNA, not replacing the DNA. Now within this, the high investment areas is to continue to increase quota carriers. And I'll talk about the areas we're going to do that in a minute. But the balance here, I feel is pretty good, but there are further efficiencies. There's certainly money that I will continue to move around in order to make sure that the high investment areas are taken care of. And another high investment area is incredibly important is the advanced services and training. Training certification for our business is the lifeblood, making sure seeding their technology is great, of course, it is, but making sure the operators can get full use, full value and get to time to charge down is incredibly important. So not only is it important, it's also a revenue opportunity for us and a profit center for us. Training in this industry will never ever go away. We have to continue to do that, and we're looking at more and more efficient ways, more dynamic ways, more proactive ways to deliver on this training mechanism that I want to do. The balance here between the other areas, I think, is pretty good when I model and look at where we want to head as a SaaS company. Obviously, the magic number you want to get to is 50% of your spend is on quota-carrying reps. And I think that we have the management capacity and the presales coverage to allow me to do that over the next 2- to 3-year period. So customer-centric, I love it when customers say they are customer-centric, because we know, I don't know what you are, you kind of turn around and say we don't like customers. So the alternative to not being customer-centric is probably going out of business. So it's a bit of a cliche, but I want to explain what we mean by it. The model that we have to go to a delivery company on a SaaS world and via cloud and get more of our solutions to more people in an easier way to consume means that we wish to have renewals to be very, very efficient. So a lot of AI work, a lot of proactive work here, a lot of ML to understand how we can actually proactively get in front of our customers, understand issues that they face. A lot of investments about moving our renewal base as much as we possibly can into -- like a classic SaaS company would into the CX team and then freeing up those resources on more net new ACV, because net new ACV is the golden standard of what we want to do. And I'll also talk about how we've aligned compliance towards net new ACV and actually driving expansion of the base. And actually, I should say, incremental ACV because net new gives you the fact that we're going to sell a new use case to a new customer. But of course, if you are spending -- anything you spend in a period secondary to the period you're in is incremental. And our TAM allows us to do that with our upgrade path. And as I said, Insights has been incredibly powerful driver to not only add values to customers, but allow us to actually have some pricing leverage as well. So you've seen this slide. I'm just going to have a different slow on it to see how you would -- I would actually approach this in the market. And so just remember the Insights, the Guardian and the Pathfinder. So Insights is an upgrade and upsell and expand. So I have all 3 motions available to me in that area. It's an upsell because it's from the base, we offer increased productivity. It's an upgrade because it actually does more than the product before. So there's a TAM expansion there. And there's an expanding use case. There are use cases that you'll see now that I know you're all committed to the demo that you will see, which means that the customers were not necessarily need that product before we see it. So it's opening up new TAMs. Guardian is an upsell and a cross-sell. The ability to share and review is incredibly important. And one of the buying centers that we need to think about and I want you guys to think about as we think about law enforcement agencies, central government, there's 2 sides of a charging mechanism in most democratic countries, okay? There is the people that actually gather the evidence and then there's people to decide whether the burden of evidence is enough to take the time and the effort to go through the judicial system, which again is a huge expense. DAs in the U.S., central prosecuting services around the rest of the world. Think about how they could use this. Think about the TAM of the DA. This is often misunderstood. There's 2 sides to this story. So the win that we have and I have is that DA is being used to Cellebrite as the process tool to understand. So there's no longer having to get the evidence in the format that the DA wants is the same format. It's extracted in exactly the same way as you use Pathfinder to find the information or Guardian to share. So the DA is looking in real time at the same information as opposed to collecting thumb drives or some of the antiquated ways that are going on. And actually, in New York, we're having a lot of success with the borough -- this borough actually, in the DA's office here being very, very full thinking about the use of using our technology to match up to what the NYPD are doing. That's a whole new TAM guys. Worldwide, that's a TAM that I think we're going to be very successful in as we go forward. Oh, I'm sorry, I missed a slide. And then Pathfinder, upsell and cross-sell. Pathfinder is into a -- people call it a new buying center, actually it is an adjacent buying center. Investigators know exactly what we do. It's not as if a detective doesn't know who Cellebrite is. As we say internally, Cellebrite is a noun. You Cellebrite a phone, that's how pervasive our technology is. But the investigators then need to do more with it. And that's why we have an entree into this client base. So how do we attack them? Well, we need to attack with specialist sellers. That's an important part. We don't want to miss our capacity in the collect and review, the DFU business. We have a specialist motion. And we've increased the number of specialist sellers within this business dramatically this year, and we're now -- and we'll be continuing to do that as we push forward. And some of the wins we have there and some of the scale of these deals are very exciting to us. So I want everyone to leave your understanding that we're not trying to drag too much out of the productivity of the existing people. We know when they're at capacity and we're making decisions to move into net new ACV at the appropriate time. So what have I done since I've been here -- in the 4 months I've been here? Well, I've learned the weekends are optional. That's the first thing I've learned. But -- I don't think Saturday and Sunday exist in Yossi's world. It's just the blur. So I just go with it. But it's a lot of fun. So I said, work is fun here. I've upgraded some of the leadership which we do now. Not a ton of replacement. So these were additions. So when I came in, there was an open head rack for EMEA. We managed to get a great leader for EMEA, a guy called Dolman. Comes with a strong background of Tableau, VMware long-standing expert system and SaaS salesperson who's taken it on. I was fortunate enough to inherit Mark. You'll be hearing from him later, Teegardin. Somebody had to inherit you Mark, so it was luckily me. But he's done a great job with the President of Americas, driving the growth of that business over a number of years. And [indiscernible] Simmons in Asia Pac and the existing person again, comes from a great background, both PTC. So I want to express to you the quality and the depth of the talent that we're now hiring. We're globalizing customer care. So that is one change that we are making. We are close to finding a new leader for our CX or CS business and doing that in a global way in order to not only reduce the cost but also birds of a feather consistent learning and giving the customer experience the same in every country will be a goal for myself. We've also added and changed the comp plan to align to the strategic goals. I mean that sounds obvious, but it's amazing how many companies you go into where the CEO wants something, the CFO wants something, the CRO wants something else. And at the end of the day, none of the comp plans aligned. And here, we were very thoughtful and I got any time to actually create and simplify the compensation plan, which is skewed dramatically towards incremental ACV. If you just want to renew your base at the same value as somebody in my team, you're not going to have a very good time, okay? You're not going to be able to afford a beer after work, you're going to struggle. If you sell new stuff, you can have champagne every day. So that's kind of the philosophy of the goal, not every day, but when they can afford. On the other side, on expansion of quota carrier reps. So actually, within my own OpEx budget with support from an excellent finance team in HR, being able to create 13% more quota carrying reps. So -- and again, it's just a motion of low-hanging fruit, collaborating together and working on what we want to do. And I'll explain after this slide where we're going to invest those. Target investment Insight sales. Insight sales is critical in this business. Small sub-200 offices, we call it long tail prime, as you'll see, is an Insight sales motion, and they are delighted to hear from us. I've never -- my office in D.C. when I sit, I actually sit with the Insight sales team because it makes me feel good about life when you see people all that energy and young and vibrant. I've never seen a team where the calls are so responsive. You phone, "Oh thanks, we needed to speak to you." Normally, a call like get off the phone, trying to sell a firewall or a router like go away, you're the 50th call today. Here it's like thank God. And it's like amazing, it's amazing. And on our enterprise business, it's all inbound. Think about that. We have 69 of the Fortune 100, and it's all come from inbound. So imagine what we can do if we start taking these outbound motions, which is a part of what we're going to do. The IE specialist have talked about and our position for FedRAMP. FedRAMP will open up a big new TAM for us. There's no doubt. I think Olive from the DEA will talk about it, hopefully, but FedRAMP will open agencies and expand that TAM for us to go after and formalize what we've been wanting to do for a number of years, and we're well on the path of that process. So fueling the growth. So how do I set up my team? Pretty straightforward at the top level, dedicated resources for the Fed and the top 250. And don't think of it just as Fed. You can think about this as a central government on a worldwide basis because what we create for Fed can be replicated in Western Europe, and parts -- and the more modernized parts of Asia. So think about this as a central government function, which has a nomenclature effect. Dedicated account execs with dedicated technical account taking all of those motions forward. Discrete investments based on opportunities that we see and a relatively long sales cycle there, but a very, very welcomed revenue stream that when you win a use case you are winning a franchise for a number of years. Mid-high accounts is the area in the U.S., which I feel we have a lot of potential. We have a new leader and the mark in that Dwight's coming from Red Hat, a very experienced seller and adding significant amount of resources in that area to make sure that we cover. Geographically, we could do -- we have opportunities in the Midwest, the West Coast to match our density of coverage that we already have in the Northeast and the Southeast. So I would turn your attention to thinking that there is an opportunity there for not only use case expansion but also net new names in that area. And then the long tail accounts. This is an area where I think we can do well and we're going to globalize this team. It's a very, very quick, very fast turnaround, very receptive audience and against discrete investments of increased quota carriers mapping to where we want to take the business. So what I want to talk about now really is why -- it's not clicking through for some reason. It's stuck. Okay. It was my final slide anyway. So maybe my final slide is just a placeholder anyway. So what I was going to talk about is the opportunity, as I see it starting now. I'm going to ignore that because it's flashing in my eye. I was excited to start. Look, sales leadership, any C-level positions are privileged. We should never forget that. But this is a true privilege. And a lot of people ask why do you start from bigger companies, had smaller teams. And I was looking for something this size. I wanted something where I could have a real input not only on the growth strategy of the company, and I think we have a great growth strategy but also helping to get the culture to a scale-up culture because sometimes you need to change the culture a little bit to scale up. And my colleagues have been completely receptive to, they put up with a kind of a loud English guy as much as possible. They're kind of loud as well. So it's, okay, we kind of make it work. And I'm more excited than ever. And I'll tell you why I'm excited. The first thing is my wife insisted on to me, you can only go and work at a company where people understand what you do, all right? Because I'm fed up with the dinner parties where you go, I'm in network and they go, my WiFi router is not working. Can you help me? Not really. Also, my day job is cool, cops are cool, agencies are cool, okay? And just think about this, I get to sell to people with guns. How cool is that, okay? And I still can't get over that when you go in to meeting and everyone puts a gun on the table. It's like it just -- has been pretty, just freaks me out, but it's kind of super exciting. And I didn't join the company just because of the mission that was important to me, but by golly, that mission creeps up on it. And it's just such a fulfilling thing to do, that you're selling something, which meets a need and delivers and you can see the output. Because selling a data set -- people who buy data centers aren't cool, okay? They're nice people, but they're not cool, cops are cool. That finishes me off. Let's get Andy back on. Thank you for your attention. Appreciate it, guys. Thank you.

Thank you very much. So let's see. All right. So we're going to pause the webcast now. I'd ask and remind people who are listening online will probably resume in about 30 minutes or so. So we're going to get some chairs assembled. [Break]

Great. So I think at this time, we'll have Dana Gerner, our Chief Financial Officer, join us. And she'll walk through her presentation. We'll have time for questions after that. So Dana, over to you.

Hi. Great to see all of you here. I'm Dana, I'm with Cellebrite for almost 10 years now, and it's a great opportunity to be in our first Investor Day, and it's even the greatest opportunity to speak to a crowd that actually cares about numbers, in financials. It's a really rare occasion in the life of a CFO. So I'll try to take the opportunity in -- take it all the way out, okay? So let's start a little bit of what we've done. And Yossi took you through the journey of Cellebrite history. I try to put it in numbers, right? So 2019, point product leadership, we've been the #1 vendor in the digital forensics unit, expanding slightly into investigative unit at that time. And we have generated $92 million in ARR. We have only started our transition to a subscription business, right? Most of our solutions are on-prem. Most of our solutions were perpetual license. And at that time, we've been a privately held company. But we are a company that think through and thinks forward, and we strategize our growth. It doesn't happen just because we -- it fell from the sky. And we decided that we want to be the #1 vendor to the digital investigation units and to the digital forensics units in reinforcement, providing a subscription license solutions on a platform. And through that way, also goes with the growth that is coming with being a publicly traded company. And we are now right, 2023. We've executed, it's there, right? We have went public in August 2021. We have actually more than tripled our ARR by just moving ourselves from a perpetual license to a subscription license. And it was a journey. It was a journey to transition the entire install base from perpetual to subscription. It was a journey to educate the customer that it's worth -- better for them to go through this transition with us. And we've done it. So this is exciting. And the most exciting thing about it -- also is that we have delivered very much as Tom said, a great financial results, not only that we grow our ARR and we do it constantly year-over-year. But we also grow our EBITDA. We've been an 11% EBITDA company. We are now touching the 20%. So Rule of 45, here we come -- here we are. And so I speak in this session, it will be split to 2. One, I speak for journey until '23. Then we'll pause and then I'll present our 5 years model, '24 to '28, sharing through the fundamentals of the growth and where we aim to go, okay? So where we've been? Execution drives financial performance, right? We plan, we strategize, we execute. First of all, as all of you heard before from Marcus, from Yossi, from Ronnen, we try to understand the customer's pain. The challenge is about lawful access of a phone. The fact that it's not enough to extract the phone. We need to help them find the insights, the golden evidence, the hidden evidence to make a prosecution to actually find the guilty party. And then help our customers go through the transition to the cloud. And Guardian is a great solution. We started the transition to cloud, both on the Guardian, but also if you look at our insights and our offering of the insights we have already integrated to make things efficiency -- to bring efficiency to the market in the insight. We are using the power of the cloud to do things faster, easier, provide flexible pricing capabilities to our customers from the smallest to the largest. So all of them will be able to actually be using those most advanced services. And we are leveraging our long-term relationship with the customers to be able to introduce more and more capabilities, more and more technological advancement and innovation and help them adopt to them. So 2023, very much that we presented before, was a great year. We finished the year beating all our guidance to the market. But not only that, we've actually positioned 2023 as a great start point for our growth in the future. And if you look at the main KPIs of 2024, there are follow suits of our success in 2023. Growth of ARR, 20% to 27%, very much as we shared this with the market in February when we did our earnings release. And EBITDA margins at an average point to 20%. So again, we are planning to meet Rule of 45 also in 2024. I would put here a very small note, because we are speaking about financial models. Still a very large part of our offering is on-prem. We do have some seasonality in our revenue baseline. So most of our customers year-end budget is Q3, federal government in the U.S. and Q4, most of our reinforcement in a large portion of our enterprise customer. We see around 45% to 47% of our revenue coming in half 1 and 53% to 55% of the revenue coming in half 2. Follow suit also is the EBITDA because if you are generating most of your revenue in second half, and you are growing your OpEx margin quarter-over-quarter, look at our '23 financials, you will see that 30% of the EBITDA was generated in half 1, 70% in half 2. But still very healthy, very positive throughout the entire year. So that's like in a nutshell and a very high level of how our financial numbers look like. We've seen a version of this slide in Marcus' presentation. Our growth are balanced. It's balanced globally. We started our business in America. Americas is 53% of our business year-to-date, EMEA is following suit with 30%, but both of them are growth engines of the company. And they are not growth engines only because of 1 sector. Marcus discussed the great opportunities we have in the state and local in the U.S. We are investing now in increasing our go-to-market efforts and making sure that we are covering the entire state and local agency Northeast, Southeast, West and Midwest. Federal is a great opportunity. And when we are going to introduced our cloud offering under FedRAMP, we are actually going to unleash new TAM, as Marcus mentioned, that will help us grow the business with the federal government and make us being able to serve them the way that they are deserved to be serviced, we are doing with the state and look at around the globe. And of course, the Americas is also our biggest market for the private sector. Around 70% plus of the private sector revenue is actually coming from North America. So this is why we have 53% of the business there. We strongly believe in the potential in EMEA. We have a new leader there, Ed, as Marcus said, very experienced. We have a great go-to-market team there. We have experienced salespeople covering mainly Western Europe. They have delivered an amazing success in the last 3 years. They are continuing growing the business. This is a market where we see also multiyear deals, which means a lot of trust by our customers that we can continue to deliver the high quality of solution also to the future years. So that's a great market for us for the future growth. And of course, APAC, 26% CAGR. APAC is a region where we decide consciously. Where we are going to invest and grow and where we are not, because of ethical reasons and business reasons. We have our main offices in Singapore. We have a very large business in ANZ, Australia and New Zealand, in Japan, in India. We are serving some customers also in other regions, but this is our focus. These are the leading countries they are both from a financial perspective but also from ethical perspective. And this is where we decided cautiously, as I said, to do business. We do when we look forward into the coming years, we expect to see more or less the same spread of revenue across those regions and a very evenly growth from an ARR year-over-year perspective. So Marcus referenced that we are serving the largest law enforcement agency globally. Not only did we serve them, they are loyal customers. We are fortunate by being able to serve them properly, not to lose even one large agency since we started working with them. And we are in this market for 15 years. So this is a remarkable achievement, not losing those customers. We are serving, of course, also the mid, high state and local agencies around the globe. And the smallest one, the [indiscernible] is where we usually see some churn, many on budgetary reasons, task forces open and close and so forth. But all in all, that level of connection with our customers allow us to maintain a very healthy growth retention rate. 90% plus is in the representation of the last 3 years. If we think about it and what I said before in Asia Pacific, we also cautiously decided which customer we stop doing business with. And in what countries we decide to stop doing business with. So if we take out around 20% of the churn, which is actually associated with Cellebrite decision to retire from doing business with customers. We actually have a natural churn of around 8%. So when I will present later on -- the long-term model of Cellebrite, we baked into that more than 92% gross retention rate because we believe that we should be 92% plus. We really trust the platform we brought to the market, the solutions that we are going to bring and the customer loyalty with us that would allow us to do so. And when we look on the left side of the slide, we can actually look at what, Jonathan, you asked before, where is the expansion is coming from. And this is actually how we see the expansion within our existing customer, not new logos, right? But a lot of new accounts within those logos. Yossi mentioned that. It is not that we are buying into a logo, and we have only one -- I would say, one customer within this logo. And the one logo, especially the mid high in the state and local, the federal, the large state police. We have a lot of inside customers. And when we look at them and when we measure our results, we look at that as expansion is growth within the same logo, even if there are some subaccounts there. And this is why usually, when you look at our ARR bridge, the new logo numbers is very small, and the expansion is the large number. And where is the expansion is coming from? First of all, to deal with capacity, right? We spoke before, we've heard from so many people here, crime is on the rise, digital investigation is becoming more dominant and more important. So they need to derive capacity. They need more insights. They need to correct more. It is what it is. This is the life, right? And then you look at expansion. So those customers already have our insights offering, they need to get the more advanced solution to be able to collect from the most advanced phones to overcome analogs. So the expansion is really about advanced acquisition of data and with those customers that already have our initial, I would say, pathfinder analytics solution. Yossi said, we introduced the first one in 2016. So those customers that started with the very early generation expand their business with us to the newest generation. And then the last thing is the cross-sell and up-sell. These are the customers that are adopting for the first time the solutions beyond the insights. The customer who decide to subscribe to the Guardian. The customer will decide to subscribe to the Pathfinder. These are the up-sell and cross-sell. And you can see that it is very consistent from a percentage when you look about it year-over-year. More and more customers decide to expand their business with us by adopting new solutions or by increasing the usage of those new solutions within their day-to-day work. So moving from a point solution that we've been before to a platform is a great opportunity for us as a company. It's an opportunity to ease the customer's process in expanding their business with us. They are just adding more modules. They're increasing their volume and capacity with us. On the same platform, they don't need to buy more seats. They don't need to buy additional licenses. They expand the licenses. We have -- they have with us on the very easy manner of procurement, right? It also means that it's more natural for them to stay with us. And we just heard from Jeff, right. Jeff, what you said, it's better when you start a journey when you deal with such complex data to take the journey from one end to the end with one vendor. They really understand how to capture the data and how to deal with the data thereafter. So we see that as a great opportunity for the future. We'll speak about it in -- 5 years more later on. Next. Look, as a company, we are committed to deliver constant financial performance at the highest level. And to do so, we need to be very conscious in how we are spending our money. When we look at our gross profit, it's a reflection of how we manage our cost of goods sold. We grew from 82.9% to 84.2% in the last 3 years. And we've done that by looking at what are the drivers of our revenue, how much goes to subscription, how much goes to services what type of services, and we are relying our cost of goods sold with what is driving best growth of the company. And by that, we can actually deliver an improved gross profit year-over-year. And we are committed to do so more and more. Marcus discussed the fact that he is building or he's reallocating resources in his entire go-to-market, that aligns 100% with that. And when we look on our operating expenses, we see, again, we improve our efficiencies in our operating expenses. We've been 74.5% in 2022. We finished the year of '23 when our OpEx was 67.2%. We grow investment in R&D. We grow investment in go-to-market, but we've done it in an efficient manner. We will do so also in the future. Yossi said that we are a people's based business. You can see it from the investment dollar perspective, around 70% of the business is actually people, right? And if you want to do and continue to be a great company, you need to make sure that you hire the best people, you retain them. And you create great cooperation between the teams of the organization. And that is exactly what we've been doing. We didn't grow our head count between '22 to '23. Still, we succeeded to deliver a very high level of performance from a revenue perspective but to go to the next level. And to be on the path for the $1 billion company, we will continue investing in people in 2024. We will invest in the go-to-market organization. Marcus spoke about adding 13% to the quota carriers. We're investing in innovation because what -- the amazing thing that Ronnen just presented, don't just come here in the thin air. You need to invest in people. We will invest marginally on G&A because we already build the installed base. We've built in the last 2 years whatever a very solid public company need, the compliance, the IT security, the financial reporting, the SOx, everything which we didn't have to do or not at the same level as a private company, but we are doing now. We have it. We settled it now, and now we are in a base of growth. But it's not only that when you are growing and you want to grow more of your people -- with your people, you need to make sure that you retain the culture of the company. And yes, we might not have weekends, Marcus, but we enjoy working on our weekends, right? We love it, right? So we need to secure the culture and our way of doing things. We still strive when we add more people. And we are fortunate that we have a low retention of people and adding the people, help them absorb the culture of the company. The culture of success, execution, excellence. This is what we want to do. People can speak with [indiscernible] a little bit in the break afterwards if you want to get a little bit more insight on what we are doing to retain people and to secure our success in future. And then I would not really elaborate about it much more. We have had a successful 2023. We grew our EBITDA to $62 million and 19% from 10% a year before. That made us very, very fortunate to step into 2024 from a very solid background of financial results. I think '23 is an exemplary year for the future modeling, because it's the first year when we've been 100% subscription company. 2022 was a year of transition. 2023 is a year of how can Cellebrite look like when you're a successful subscription company. You grow your ARR by 27%, you deliver 20% EBITDA. That is what we are. That is what we want to do and where we want to be. Okay. And it's a successful company. And when you're doing good, it doesn't only present itself in the P&L. You get to have a very strong balance sheet. And having a very strong balance sheet, we have a very strong cash. We have a very strong and growing deferred revenue. Actually our short-term deferred revenue is growing at the same rate of the ARR, which means that our customers are committed to stay with us and to work with us. We are growing marginally our long-term deferred revenue, because we are working with government agencies and their natural way of doing business is to contract us annually, not only us, but in general. But that's okay because we know how to take this revenue stream, and we know how to diligently manage our OpEx and to create a great cash-generating business, and we'll continue doing so $330 million of cash and cash equivalent at the end of 2023 allow us to take strategic decisions about growing the business. And it allows us to go and look at M&A very much as COC shared with you before. So that gives freedom of decision making. And we will do our utmost to make sure that we are utilizing this cash to increase investors and shareholders' value in the future. Now I'll go shortly to discuss the long-term model. Now many companies may take the CAGR of performance of previous years of CAGR of growth that is being described in market research. We've done that. We know how it looks like? But we've decided to take a little bit of a different approach and look at the market drivers and how they impact our growth. And the first and #1 driver is the case load, right? We've heard from everyone. Criminals don't stop. Crime is on the rise. Digital investigation become more dominant in investigation. So more and more cases are actually being processed from a digital evidence and ultimate physical evidence. When we look at our market research, we see motions of around 30% plus increase of investigation annually that involve digital evidence, not because crime increased by 30%, but because more clients and more cases are being investigated using digital sources. We took a very conservative number when we build our model and we took a 15% growth. But all in all, this is how we looked at the growth model. And when we look at the fundamentals of this growth model, based on our analysis, and we looked at how many cases have been investigated using Cellebrite Insights solution. And we found out that there have been around 1.5 million cases. Take our ARR from the public sector, around 90% plus of the ARR is coming from public sector, divided by 1.5 million cases. You will see that the agency spend with Cellebrite $190. Not thousands of dollars, not millions of total, $190 per case. It is maybe pocket money or coffee of an investigator for 1 month spent, high crime investigation costs tens of thousands of dollars up to hundreds of thousand. $190 on digital investigation. When we say that it is really nuisance and there is a way to grow there, this is why, okay? So this is number one. Second, we spoke about the increase in cases, 15%, we baked it into our growth model. Third, we've heard again, data becomes more complex. It's more difficult to acquire the data, and you need more sophisticated tools to manage the data and to analyze it. All of that, this is our excellent cross-sell opportunity. We have baked around 9% to 10% increase in our model on an annual basis which aligns itself for acquiring the most defined solutions. And on top of that, a very, I would say, modest price increase of high mid-1-digit percentage. So take all of that together, take into consideration the loyalty of our customer and their need to us, take the 15% increase in cases and get to 3 million cases by the end of 2028, you'll get to around $300 per case spend with us. Again, so small. Maybe we're too cheap, right? But that's not very aggressive model. I think we cannot agree. So how does it look? We finished 2023 and we finish it with $360 million ARR $190 per case, 1.5 million cases processed with Cellebrite. Then we took those 15% increase in capacity baked it into the model. We added need to penetrate through the entire case to closure, a platform, by adding all the new capabilities and the new technologies and the new hurdles in acquiring the data processing and analyzing it. Had a very reasonable growth in the private sector, its expansion around 20% plus year-over-year and a very modest growth in price increase. And this is our path for $1 billion company in 5 years from now. Not aggressive, very achievable and it is all on us. We need to deliver. We need to deliver the technology, Ronnen. We need to deliver the go-to market, by Marcus. We have the best in class here in our needs to do that and we'll get there. And we'll get there in a very solid professional manner, and we will follow the follow KPIs. ARR growth, we believe that in the next 5 years, it would average itself on 24% higher in the first year, a decelerating growth in '27, '28. Revenue will follow suit, still not touching the CAGR of the ARR, because we have the professional services, which are very important, but are not growing at the same rate as our subscription license business. And we do plan and bake into the revenue recognition, the transition to cloud. We finished 2023 with low teens percentage of our ARR is cloud. We intend, based on our analysis, to triple it in the coming 3 years. It will have some impact on the pace of revenue recognition, that's 20% CAGR. Gross profit, proper allocation of cost to revenue stream, proper OpEx management, we will retain the 82% to 84% ratio in our perspective, and this will result Rule of 45. Here it comes. You can see it. It's obvious. We know how to manage our OpEx. We know how to grow it diligently. We know how to allocate resources to the right places that will bring the right return on investment. And we will continue doing so. Yes. So our future is bright, right? I hope you all concur to this analysis. Justice Accelerated, it's not just 2 words attached together. It's a mission statement for us. And it's something that we wake up in the morning and go to sleep with, every day, because we believe in it. I really, really thank you for your attention. I really thank you for allowing me to share with you our vision of the company from an [indiscernible] perspective. And I'll ask Andy to take us for the rest.

Mike Cikos from Needham here again. Just 2 questions. The first is, if I look at the Rule of 45, and just to be clear here, right? So fiscal '24, we currently have ARR guidance for growth of 20% to 27%. And then EBITDA margin guide of 19% to 21%. You're saying you can do a Rule of 45. Isn't this effectively raising your guidance for the year to 25% plus on the ARR?

Rule of 45 is our mission statement for the coming 5 years. There might be it will do 23%, there might be it will do 27% -- a 43% or 47%. We are not saying that we'll do exactly 45% one year in and year out. We are investing very much this year in the go-to-market organization. We are going to grow our head count by 160, 165 between those 2 guys, who are sitting here mainly. We don't change our guidance. What we've shared with the market on February 15, we are standing behind. I think the Rule of 45 alluding to the fact that we believe that with a lot of stride and effort, we might get there. But we still stand with what we said to the market.

Just one more. On the ARR per public sector case, if I just run the numbers on what you were showing, I think the largest year-on-year increase is actually in '24. You're looking at 18% growth on an ARR per case. Why is the growth so strong in '24 versus, call it, mid-single digits over the rest of the time horizon?

Our '24 is the year of the launch of the insights. So the upgrade of the install base does come with different pricing that actually incorporate the values that we are bringing in the new offering. .

I think we owe an uncertainty to a question here.

Thanks, Yossi. The question was just on how Quantum is going to impact actually both the solutions and the challenges for Cellebrite?

I think Ronnen will be the one to take that.

Thank you. When I think of -- and I'm an avid engineer. So I spent in the last year going a lot into what Quantum computing is about. I must say as it relates to us. It's 2 degrees of separation from what we do. So what you'll see us, for example, when I discussed AI and Gen AI, et cetera, we're looking where technology is available in kind of like a commodity to be deployed in our solution at scale. Quantum computing when I think about it, honestly, probably will take 2, 3 years before it become mainstream and our customers will wait to this advent for the short run.

While we got you, can I squeeze in one more? What is the upgrade look like, the learning curve going from earlier versions of PA into insights? So people who were using UFED previously.

Good. So look, Insight actually brings a degree of simplicity to our customers. As I mentioned, we already had the solution deployed within 20% of our installed base by the end of 2023. Eventually, we're amalgamating 2 solutions, the basic offering, the advanced offering, which means that all the customers can enjoy simplified user experience, more digital witnesses, more data, more streamlining and operations. So on the whole, it should be much easier to adopt to the new solution, less money or work between stages and so forth, okay?

Yossi, Dana, in terms of the scaling of Pathfinder from 2023 through 2028, you described how the ARR per case can grow from 109 to 300. But what does that assume in terms of the penetration of Pathfinder. I think you discussed how there's over 5,000 customers that are using your solutions and predominantly that's collect and review. But what's the opportunity for that cross-sell? And what's the assumption there in terms of how like Pathfinder penetration contributes to that ARR increasing?

I'll start with the perception, may be is related to the expansion, and then we can add maybe a little bit numbers into that. As we embarked with a Pathfinder in the beginning or investigative analytics in general, I think we tried mostly to sell that into our familiar customer base, which are the labs environment. And in a police world, just like in many other worlds, you need to sell the right solution that serves an upgrade of the right KPIs, okay? And actually, the Pathfinder was made in order to solve the major KPIs, which are on investigative side quickness of golden time to evidence dealing with our structures and unstructured data. And that means that -- and that's -- I'm glad to say, although we have done a shift in the go-to-market and in the focus, we are turning into investigative units, who are dealing exactly with that. And over there, we currently have a single-digit penetration with an expected growth of 35% to 50% based on the survey that we have done last year. And this is something that creates a big and amazing opportunity. I spoke about all those thousands of high crime units, which are probably the most relevant for those sophisticated crime cases when you need link between different people. And you are dealing a large amount of data. And they are dealing with drugs, they are dealing with human trafficking, and they are dealing with gangs, all those complex cases. And over there, that's where the investigative analytics will come into power. Translated into a growth model in ARR. .

May I just add to that. The cloud will change the landscape there as well. Very much what we've done with Premium as a Service, that initially Premium and Premium Enterprise were catering only the largest customers. Because of the business model and the pricing at the moment, we introduced the Premium as a Service, we could cater the smallest of the smallest customer, with a very structured and easy pricing model. We heard before that the Guardian is a bridge which would deliver the information from the digital forensics unit to the investigative unit. Think now about that and now add engines around investigative analytics capability to that and in a cloud-based SaaS-based model. You can democratize also and allow some of that auto to the smallest agencies, and this will further fuel our expansion within investigative analytics and Pathfinder to the smaller customers as well.

And then maybe last to that, I want us to look not only at the product investigative analytics. I want us to look the way we look at the segment, investigative units with investigative analytics, with open source intelligence, with the ability to bridge back-end analytics with evidence management connected to the cloud, levering on those investigators that we are serving today with the outputs, which are coming from the inside. The IU, the investigative units with all those parameters, and this is before talking about inorganic element is an amazing opportunity.

Dana, here. I have a few questions. I'll start from the easy ones. Yes, you're migrating to -- you migrated to recurring revenues. How much of your 2024 revenues are in visibility? Meaning when you enter a year, how much visibility do you have into revenues for the next year?

Okay. So if you look at the $360 million ARR we have, right. And assume that around 30% of that is associated with long-term contracts, which is more than 1 year. Then we're talking in principle about the fact that we have around $90 million that are secured, because they are multiyear deals, and the rest is actually have to be renewed. Think about our gross retention rate, you get to the numbers in principle, right? So this is what we see when we step into a year. Of course, we have on top of it already, the opportunity is being managed by the sales organization for new ACV, for increased ACV. But that is an opportunity, right? This is now a statistical of opportunity management how it will be transitioned itself to booking and revenue. We have some visibility, but we -- I would say that we have around 70% visibility into the year if I encompass everything on this side of the year.

And you also mentioned that you decided not to work with certain customers in the past, right? Do you plan on -- are you all set now with customers? Meaning do you plan to continue and do it for 2024, 2025?

Do you want to answer that?

Yes. I think that currently, we are in a very good picture. I think that we've done a very strong, I call it, compliance wise, ethical wise cleansing in the last 2 to 3 years or the last 3 to 4 years, but we might add here and there due to development, but not as massive as we did in the last 2 to 3 years.

Got it. Okay. So my last question, the complicated one is about your assumption on revenue per case. Is it the way you charge? Do you charge on revenue per case? Or is it an implied number? And the reason why I'm asking it is because I understand the way you do it, the way you present it, but I'm actually interested in the numbers behind it. Meaning what drives the growth in revenue per case?

So I think what drives the growth in revenue per case or the main 2 drivers of the fact that we know that they would need to subscribe more from us to deal with the capacity. And we assume that, that will drive an increase of around 15% as a CAGR over the next 5 years, which is, in our perspective, reasonable moderate assumption. And the second is really about the subscription into the more advanced solution, the Guardian, the analytics. We have done a research. We've worked with a research company early in the mid-'23. We've analyzed those 2 drive vectors, the Guardian and the investigative analytics and the growth between the IU. And their assumptions to us was a growth of 35% to 50% year-over-year. So we have baked it a little bit more moderate into our model, but that's like the expansion that we have on top of the capacity to serve. And then small price increase, and that's all.

Great. Thank you, Cellebrite for the day. Very, very helpful. Yossi I've got one for you. I'm just curious, the market perception of Graykey or Grayshift being better than on the iPhone, I imagine you want to address that. We did a lot of field work. I did hear that come up. It feels like it might be a somewhat dated perception, but I'm curious where that came from? How it's evolved? Potentially what you're doing to address it?

Well, first of all, I would like to say, well, there is no GrayKey, it's part of Magnet today, okay? There is a GrayKey as a product, and there is Magnet as a company, but there is Cellebrite as an end-to-end platform, all right? And in that respect, you will find. And our customers spoke about that. I concur with the perception that there will never be one vendor. It's a multi-vendor environment. And over there, the key, the big question is who is the primary tool that the officer will take in order to start and solve the case and deal with evidence. And I would say that if you look statistically, and if you look at the entire spectrum, even in iOS alone, we are leading by far. This is before I'm talking about Android, where we are smashing by far, all right? So in the context of operating system in the context of the complexity of the data and how to solve that pain, this is what I said at the beginning, we solve it in the best way. And this is the way I ask you to look at Cellebrite, one building block of an entire flow of things. And as I said, one need to look at who is delivering the true end-to-end platform across the entire thing. You will always find small vendors that will do something better than we do. But in the context of complex and end-to-end, we are by far the best.

Can I answer it a little bit YossI?

Absolutely.

The other thing is as you heard from [indiscernible] the evidence customers there is, they're using it just to unlock and then they still go to the Cellebrite extraction. So it's actually kind of not a substitute. We're not really losing that. There is an education piece that we need to do, and that's where the training and certification comes in, because there is a tit for tat with who's ahead on iOS on these kind of things. And so we are ramping up our education. And I think through the summer, you'll see those uses change as well.

And don't get me wrong. It's -- the GrayKey is a good tool. The police deserve good tools. And don't get me wrong, the competitors are good competitors that pretty much depend on us.

Just curious if you -- in your 6% revenue or pricing assumptions that you take into account or debate, a lot more debate going on around budgets within your customer base? And then how often is market is going to, maybe as you get bigger penetration, be asked for discounts from your customer base?

So first of all, I would say that as we look -- Dana mentioned the survey, we are doing a lot of surveys, and we clearly look at least the public sector as an area where budgets are increasing for digital. In general, this is one item. Second, there is a relative advantage here. Another one, predictability because the highs are never too high and the lows are never too low in a general perspective. As for the request for discount. I say that in general, because I can talk about a few cases here and there when we're getting requests from discount, mainly when it comes to really large deals. But all in all, I would say that, that segment, I appreciate the segment, and I'm talking about the public also for the fact that they appreciate value and they pay for value. That's what we see actually. And we see the responses when we launch right now, the Cellebrite Insights, good responses, customers appreciate value.

And on the budget question, I think the budget is just [indiscernible] budget for Cellebrite. It's about having a more sophisticated sales thing that actually creates a budget across [indiscernible], because we're effectively [indiscernible] what are you going to do. So it's about creating the competitive edge and the digital transformation. So I think that we believe that budget is growing [indiscernible].

In order to help the industry, by the way, and I'm leaving budget on the technical mechanical element but more strategically, I'm glad that our activity in other places, for example, on the yield reflects the importance of the states and the federal government here in the U.S.A. to support the agencies with that. And I'm saying that we are facing a very positive resonance to that when we do this activity. So we actually anticipate that more budget will be available on a generic statement for digital and on a state level or on a federal level.

I have a follow-up on this discussion on GrayKey in that -- from the customer panel, it seems evident that there will always be a multi-solution approach. But taking this one step further, you put out the competitive slide that listed MSAB oxygen and several other smaller vendors, do you think that maybe if agencies today are using 5 different solutions that can be consolidated down to 2 different solutions in that right now, like budgets are great, property taxes are increasing, sales taxes are increasing, but budgets may not be great going forward in the future? And in tighter budgets, do you think that there's room for consolidation? And have you observed like any vendors leaving the market and that you're increasing the value that you provide, and so you're providing some value that previously other vendors may have provided?

In this industry, as you can understand for 15 years by now. I can say that -- you can hear me. I don't know if it sounds exciting, but the same names that were on the chart 15 years ago are the same names on the chart as we speak right now. By the way it shows a few things. It shows a very tough barrier entry for new guys. This is one, which is a relative advantage. The thing is what has changed is the size, clearly, Cellebrite and Magnet, for example, and Exterro on the private, by the way, Exterro via acquisitions, took off quicker than the others. But -- so I anticipate that the vendors are there to stay, but the gap between the first and the second to the rest will be bigger. Let's park that aside. We see a trend, which is good for the industry of large players, which are entering into this space. And I'm not talking only about DFU and IU, digital investigation in total. So you see the Motorola's of the world are entering in. You see the NICE of the world entering in. The OpenText which are entering and there is a race for some kind of consolidation, but not on that level of the expert tools. The expert tools will be there, and I anticipate that they will stay. I hope I gave you -- on a 10,000 feet.

I think Tom made a good point, which I need to add, sorry [indiscernible]. Guys, we're a fraction of 1% of the budget of this. So it's like -- it's not as if it's like an Amazon versus Google on a hosting thing. It's not like that. We have massive expansion opportunity by moving up the value chain. So I'm less worried about budget constraints. Because I think more and more budget goes towards this and the more we do in the analytical side, the more budget becomes available. So I think there's more opportunity than price pressure on those points.

Yes.

We have time for maybe 2 more questions, so we'll go to Mike here.

My question is actually going to be for Marcus on the go-to-market. And I just wanted to see because I imagine their view of the '28, long term is rolling up from you. So can you help us think about -- like I think about that slide that showed like the large top strategic accounts, the mid- to high- and then the low touch, right? How much ARR is expected to be tapped into from each of those segments of the pyramid as you drive towards this longer-term model?

That's a great question. I'm going to give you a bit of a varied answer. It's going to vary year by year. So what you're going to see, you're going to see an acceleration as FedRAMP kicks in. So you'll see you'll see a bit of a knee in the curve, because I think you get quite a lot of adoption when you normally get FedRAMP. I've done FedRAMP twice before, and I know the kick you get. I then think you sustainability will be more consistent through state and local. I think state and local feels like a generic consistent growth rate. And I think you'll see actually a bit of an acceleration at the lower end of those 2. So I would be thinking about the middle tier being roughly straight line and then the other 2 maybe having a bit more of a knee in the curve as we go through.

We have a question over here.

Just wondering how you think about growth in ARR into 2028? How much of that comes from solutions you guys offer today versus future innovations in adjacent areas? And how does M&A play into that? Is there tuck-ins embedded into those numbers? Or is that going to be additive to the model? .

So I would say that this is an organic growth model with some tacking inside, right? Because these are very small supplementary, complementary solutions. We are looking at our C2C platform, is what it needs to serve from a solution perspective. So what problems do the customers have and how we serve them through the C2C. So it's not that we have each and every module or advancement already defined now for 5 years from now, but the pain now is the pain, and we assume that -- what we are presenting here is solving the pain that we are seeing now. And what we expect of it to evolve in the coming years. It will come with some innovation, of course, it might come with some new solutions that will either cater the needs of the digital forensic unit or the investigative unit, but we don't expect it to step out of this, I would say, world from opening a case to a closure of a case.

As a generic closing statement, I would say mid '23, we finished a strategic project, and we looked very carefully and deep into what we need to do in the coming 3 years and then beyond. I would say that for the next 3 to 4 years, there is enough meat in order us to focus on what we do right now and expand over there. There is a huge growth opportunity and practical growth within what we do today, and we need to focus on that in business. You need to know sometimes where to focus and where not to do. We have reached people's problem. We have enough to do, in what we know that we intend to do.

So in terms of timing, we've come up toward the end of our formal session. So I'd like to thank everybody who joined us via the webcast. I'd like to definitely express our appreciation for those of you who took the time to attend in person. So as we adjourn from here, we do have lunch available. Marcus is a salesperson. He's done a great job of selling our demo. I would encourage you to spend the 15 to 20 minutes to visit with us in an adjacent room where we'll do a product demo, and we'll take you. Scott, we won't take your phone, okay? But we'll use an example of somebody else's phone and we'll walk from...

Can't we do it only lawfully?

Lawfully. From case to closure. So we'll showcase all 3 flagship solutions. Maybe it's not necessarily a day, but it's a week or a couple of weeks in the life of an investigation and how our solutions come together. So if you can stay, I think you'll get a lot out of it. Thank you all very much.

Thank you. Thank you very much.