WisdomTree, Inc. (WT) Earnings Call Transcript & Summary

All right. Thanks so much, everyone, for joining us this afternoon. For anyone who doesn't know me, I'm Ben Budish cover U.S. brokers, asset managers, and exchanges here at Barclays. And after this session, we've got from WisdomTree, Jon Steinberg, Founder, and CEO; and Jarrett Lilien, President, and COO. So gentlemen, welcome. Thanks much for being here with us today.

Thank you.

Maybe just to start off, I'm a bit newer to the WisdomTree story. Things have changed quite a bit over the last couple of years. For those who haven't maybe checked in on the story, can you maybe talk about where the company is today versus, say, 3 to 4 years ago?

So I think I wouldn't go back 3 to 4 years, I'd go back a little bit longer. If you go back to 2015, 2016, to the height of DXJ and hedge, we were amongst, if not the most heavily concentrated publicly traded asset managers. So the #1 thing I would say is we're now a tremendously diversified balanced business. We took the cash flow from those funds. We made a couple of acquisitions in Europe. So now we have $25 billion of the $75 billion coming out of our European operation. And we also evolved from really being a firm that sold individual tickers to being one of solutions. So we made investments into data, into technology. And really the -- we've really emerged where the model business and the outsourced CIO is the solution of choice for us. And then I guess the last thing -- well, 2 other things. So we've made some early investments in crypto, the asset class drew exposures in Europe, ETPs, and direct index here in the United States. And the last thing really that makes us different from when you looked at us in the past or when you might have looked at us was with COVID, we went to a remote first orientation, and it's just been fabulously successful for us. So we have -- it's hybrid, but remote first. And so with all of that, those are, I think, the major changes unless Jarrett, you wanted to add something more.

I guess the only thing I'd add that it's great to see people here, and thanks for coming to hear the story. But I feel we actually have maybe the most exciting story in asset management, which I know we're going to talk more about. But unfortunately, for us, it seems to be like a best-kept secret as well. So one of the big changes versus 7 years ago was talking about the concentration in 2 funds a broad suite of products, best-in-class organic growth at the moment. And then which I know we're going to talk about is our strategy and digital assets.

Definitely. Well, let's keep going there. So there's been a lot of macro certainty in 2022, definitely, a challenging market for all asset managers, and performance inflows have been difficult. But you guys have had some surprisingly strong net inflows. So what's driving that? How do you see the firm managing through the environment? And looking forward into the near term, what are some of your top priorities to keep that going?

So as Jarrett said, we have 12%, 13% organic growth, so best-in-class of the public asset managers. We're well positioned for a couple of big themes, rising rates and the rotation to value. I think those are why we are growing so quickly at the moment.

And then if you go back again to your first question, years ago, a smaller, more concentrated family of funds. Now, we've got global diversity, a very broad suite of funds, and we've got great flows coming in across the board. And I'd say things that really excite me and keep the momentum going. Models business helps keep the momentum going, performance of our funds. I saw a report on another asset manager recently where they said that something, like I think it was 15% of their funds, were 4- or 5-star rated closer to 50% of our funds are 4- or 5-star rated. Actually, when we look at it, nearly 80% of our AUM is beating its benchmark. So great performance, but then it's across the board. So if we look at inflows versus outflows, we have about 3x as many funds inflowing and outflowing. So it's very broad. It's based on a great suite of products, great performance, which gives us this confidence coupled with models that this is momentum that's 8 quarters old now, but we think it keeps going.

And can you talk a little bit about like the go-to-market? So what is -- how should we think about your distribution strategy versus investors or advisers see the performance and they're automatically attractive that? How do you think about those 2 priorities in terms of what are the main inflow drivers?

You want to start?

Well, I would say, in ETFs, it's less performance like active management trying to beat your benchmark here. There are elements of where we use what the industry calls smart beta, what we call modern alpha. We're trying to deliver better performance, but it's less portfolio managers picking concentrated stocks to do it. So it's a smaller index construction. There is -- now in our in ETF land, the gatekeepers have really not embraced alpha in the wrapper. Now, ARC showed some very extraordinary performance. You're seeing some mutual funds converting to the ETF wrapper. And so that embrace a traditional active, alpha-generating active is now coming to the ETFs. For us, a lot of it had been through access and through differentiated outcomes like hedging out currency or hedging out duration, things like that, so that they became tools, building blocks within a portfolio.

Great. Maybe to keep touching on the products that you mentioned maybe 7 years ago or before 2 main products. And so how diversified is the product group today? What are you most excited about? Where have you seen the most traction? How would you describe that?

Sure. I'm excited across the board, as I said, and you see it in our performance, you see in our -- the breadth of our flows, but you have different pockets in Europe. We've done very well with some of our differentiated gold product. We have a lot of commodities product in Europe, commodities ex gold. We've had some good strength. But the biggest success that we've had in Europe over the last few years has been building out a UCITS family. That's been very exciting thematics. We've had some success there. And then the U.S., typically, our funds are more about better value, a differentiated value that comes with a slightly higher fee. Our average fee these days is, what, close to 40 basis points. But one of our products in the U.S., which is a first-to-market beta product being a floating rate treasury fund, at slightly lower 15 basis points has been one of the exciting successes this year.

But in terms of, let's say, our U.S. equity, which is like a $24 billion asset class within WisdomTree, we're showing for the last 3 years, 10% organic growth, 12% or 13% year-to-date, and we're doing U.S. equities at about a 31 basis point revenue capture. So it's a good value proposition. And we're seeing it again just the rotation to value, I think, is a very constructive theme for WisdomTree.

Something for people that aren't so -- that might be new to the story. So we specialize, you look at us and you can say, “Okay, the specialized and exchange-traded products.†But our view has always been to be an innovator, but also a pioneer. And it has been about what is the best-structured product that we can bring to the market that gives best access, makes hard to access or hard to trade things easy to access or easy to trade. So that's been our mission and approach. And we believe ETFs are the answer to that. They have been the best structure, the best access. And that's been where we've focused. But we've done things like in our indexing and a lot of our funds in the U.S., they're fundamentally weighted instead of market cap weighted, which doesn't sound like a lot, but right now, that is really helping us benefit from the shift to value. We do all sorts of things like self-indexing, where we create our own index, which makes us actually better equipped to not only be able to survive in a lower-fee world, but be more creative with the products that we bring to market. So that's always been our background, and that's an important distinction to make as you talk about what we're trying to do in the future.

Great. So sticking on the product side. We'll get to digital assets shortly. But maybe I think on newer product that is maybe a little less well understood is the WisdomTree managed models. Can you maybe talk a little bit about what are they exactly? How are they different from other models? And where do you see the most traction? Where do you think this shakes out in the next, say, 12 to 24 months?

Well, so the concept of a financial adviser having a model is not necessarily a new one. For us, what that had meant years back is we would try to sell to that adviser or to that advisory firm a place in one of their models. So it was a single ticket ticker sale. We're trying to say, "Hey, you should put this product has a great place in your model. One of the bigger trends, bigger macro trends in wealth management has been the move to centralized models, home office models. And so we have a 2-pronged approach to doing more in the models business. One is to work with the big wires like Morgan Stanley, Merrill Lynch and get into their managed models programs, which we have done. And that is really great. You're now -- you've won a big beauty contest, a very involved diligence to be a winner on a platform. And if you're not a winner, you're not being marketed to their army of financial advisers. So as we've won with Merrill, we've won with Morgan Stanley, we now get a preferred position to pitch to the financial advisers. Now, if you're one of those wirehouses, what's great is the house is managing those managed models. They have a place for them, there's content for them. If you're an adviser and you want into one of those funds, you just say, "Hit the button and you're in." So that's great. We're there. But if you're an RIA or at an independent broker-dealer, you might want to be in on this big macro trend, but you don't have the house that has the set up to build the models and to the workflows around the models, how do you get new money and how do you get money at? How do they rebalance? There's no easy button for those participants to play in this big macro trend in wealth management. So we've done 2 things. One, we're working with the big wires to be on their platforms. And then we've created something we call portfolio growth solutions, which is this way for the rest of the market to participate. So we will work with financial advisers, RIAs, IBDs to help them create their own custom models, but then maybe even more importantly, the easy button where they -- if they want to get in, they can get in, if they need to rebalance, they rebalance. So that models business, it's very important to what we're doing. It's now about 12% of our assets coming in are coming from managed models. That's a stickier type of business. It's more like an annuity. Once you're in with an adviser and you've got some of their mind share. Now, it's just up to them to either get more clients in or get new clients themselves and it builds upon itself.

Great. That was no super comprehensive things -- so let's move to the digital asset side. So maybe starting with Europe, where the environment is a little bit -- I don't want to say mature, but it's a little more, let's say, stable from a regulatory perspective. As far as crypto ETPs go in Europe, what's the lay of the land, like from a competitive perspective? How many competing offerings are there on the content? And how do you see yourself positions?

So there's -- we're 1 of 6 or 7 players on the continent, certainly, crypto ETPs, crypto is an asset class. We're viewing it as an asset class. We're really focused more on the wealth management and the institutional side versus retail. There are some regulatory advantages to doing that. The -- we're averaging from an economic standpoint anywhere from -- I think we're netting more than 100 basis points on crypto, but we're well below the 250 basis points of expense ratio that certain players are in the space in light of what's happened in crypto with to this sell-off and certain firms that have imploded, I think it's very helpful to have an established brand, one that's been around for almost 20 years. I think it is helpful. And from the institutional investor, they've been kicking the tire for quite some time looking for their entry point, but we're really playing for -- it's a small market still. It's like $2 billion of AUM. We've had positive flows this year. Net-net, we're positive. But it's been a labored environment to be bringing money in. But we think that we're laying the educational groundwork for institutional and wealth managers to choose their entry point and to grow hopefully significantly faster.

And really 2 approaches when you think of crypto, we oftentimes just talk about digital assets. And again, a 2-pronged approach here. We want to bring the crypto assets mainstream. So that's what you're talking about what we've done already in Europe by creating some of these funds. But much more exciting, actually, we want to bring mainstream exposures and make them blockchain-enabled.

That's super fascinating. We'll get to that. Maybe a similar question, though, just tying back to what we're talking about in Europe. What's your view on the environment in the U.S.? I mean there's been a lot of regulatory challenges to get what seem like simple products to market. How do you see...

Yes. We add the first ETF that had bitcoin futures in the fund or broad commodity fund, GCC. We only had a 24-hour advantage before they allowed a full 100% futures-based crypto product to market that was pro shares. We have filed for physically-backed Bitcoin. We believe it's a better product. So just because it's easier to get to market, it's really not the right answer for us. We know that one-day spot bitcoin physically back bitcoin will come to the market. It's better. They won't face things like contango. So we're waiting for that. We would assume that when that happens, we will be first or amongst first if to get that approval. That said, under this administration, we do not believe that crypto will evolve with any energy in the ETP space that the SEC is not that regulator that's going to allow it. That's why we're putting so much energy into SMAs for crypto or direct indexing for crypto.

Makes a lot of sense. What about in terms of broader demand? I mean obviously, there are regulatory challenges in the U.S., but it seems like when we hear from the crypto-specific players like a coin base or whoever, that the commentary is that there's pent-up demand, but there's hesitation because of regulatory concerns because prices are lower. What are you guys seeing to that extent?

I think like any asset class, their demand grows and wanes depending upon where you are, are things going up or down. It's been very much of a down market and a lot of speculation was built into crypto as an asset class. And I think it's been a very difficult stretch for a lot of investors that came in. That said, I believe that over time, this asset class will provide opportunity for significant value creation. You'll have to be smart about it. But I think that there -- it's an asset class that's not going to go away. So -- but I wouldn't make it into so many people romanticize it or villanize it. That's not what we take. It's just an exposure. We have like 400 funds, so you can buy coffee, crude, gold, silver, palladium, platinum, equity, currency hedged equities, duration. We -- it's just one of many, many things. We just want to make things easy and compliant to trade. That's all we're trying to do with this. And I'm assuming that when growth does resume, there will be a lot of money that goes into the asset class.

Okay. Jarrett, maybe let's go back to what you were saying earlier about being able to take more mainstream things and put them on the blockchain. So maybe the broader question is, how do you see blockchain in general impacting financial services, the asset management industry as a whole.

And that's where I planted the earlier piece. I mean our business is about best-structured access. And so on the crypto ETPs or ETFs, we're going to find the best-structured way for investors to access that. But also part of best structure is what's the best wrapper and just the way we think ETFs are the superior asset management wrapper of today, superior to a mutual fund. What is the next superior wrapper that's coming down the spike? And we see it as being blockchain-enabled. We see this being digital and being able to take those mainstream exposures and have them be blockchain-enabled we think, is the next step in asset management.

And for WisdomTree specifically, how do you see the company's role in that potential future world?

So we create transparent exposures. We're very strong with regulators. We're very strong on branding compliance. All of these are of necessary skills to bring regulated assets onto the blockchain. We are -- as we said earlier, we're tokenizing gold, we're tokenizing dollars, we're tokenizing treasuries. Some things can live outside like gold can go to exchanges that exists today. When you start doing things funds, treasuries, securities, equities they don't -- there isn't a venue right now for them to trade them. Most -- the exchanges don't have that license yet. So it will be -- the best wrapper will be a combination of tokenization with our mobile app, WisdomTree Prime, which is in beta test now rolling out nationally early next year. They're -- like ETFs, what made ETF so obvious that they would be successful. And today, it seems like how could you not have seen it. But -- so we launched our first funds in 2006. And very few people were really embracing ETFs at the time. But you had a couple of characteristics. One, if you had a brokerage account, you could buy an ETF without paperwork. So you had convenience then it was liquid, transparent, intraday liquidity as well as tax efficiency. So a little bit better in every area, and that is why the ETF has become so successful. When you think about this new world, you're going to still have what's more convenient than a brokerage account, a smartphone. It's like 80% of the earth has smartphones. You'll be adding -- they'll be as transparent or more transparent on the blockchain. So if you think about what is the blockchain, cryptocurrencies are a use case of the blockchain. The Internet has transformed most industries, but it hasn't yet transformed financial services because the user interface has evolved. So you -- everyone sees a Chase mobile app. And so the user interface has changed, but the middle and the back office has not changed. So you have centuries, literally centuries of legacy issue where you have a bank account, a brokerage account, a credit card, all separate with an interface that helps market it. What happens when you really bring financial services onto the blockchain, the middle and the back office come to the blockchain. And so things like near-instant settlement becomes so think how profoundly impactful that is in our little world of asset management, whenever we want to communicate to a fund shareholder, we spend $0.25 million to $1 million. We go through Broadridge. It's a laborious process to communicate. Now on the in the wallet, it will be as simple as sending an e-mail. So you could just start sensing. You want to pay interest in dividends. It takes you weeks to put the money into a customer's hands. Here, it will be near instant. So it will be very robust. And I would think -- I would say, for me, I knew the ETF would win in the United States because of tax efficiency. I believe the killer app here on the blockchain will be peer-to-peer. And it will -- so you -- it will evolve the way people interact with their money, and there will be a blurring of gold and investment or savings. If you have 1 million users in WisdomTree Prime and you're able to swap between all these assets, are you in exchange? Functionality will blur, so you'll have to be a very disciplined marketer. But the -- there's a tremendous amount of creativity a first-mover advantage is possible, and we think that it will deliver better economics than asset management today.

And if you think about it, you could say, wow, that sounds like a real departure from your business today. And actually, it's actually not. If you step back and where I started earlier, we're about best-structured access -- we believe that the best structure to access to even mainstream assets is on the blockchain. So it's exactly what we do today. We're leveraging all the expertise we have, all the operations we have. So this is not a departure this is an evolution, a natural evolution and next step, not only where the industry is going, but it's there for us to take. And the big opportunity, I spent a bunch of years in the leadership team at E-Trade, all the way back to 1999. And there are a lot of similarities here where back in 1999, there was a lot of experimenters, a lot of speculators then the Internet bubble burst in 2000, I'd equate that to crypto winter. And what happened was is actually the effect was that after the Internet bubble burst, yes, the speculators went away, but online financial services went mainstream, and we see the same opportunity here as blockchain-enabled financial services is what we're talking about. The next step is for that to move away from speculative bitcoin and move towards mainstream financial services.

Great. Well, I wanted to ask about WisdomTree Prime a little bit more, but maybe I'll hold that off for a second and ask you an impossible question. So the move from to mainstream financial services on the blockchain. I think it feels like every time there's a new like technology paradigm shift, media pundits will it's going to take 1 year, 2 years, 3 years and it takes 10 years. So I think the biggest challenge for financial services on the blockchain, it's been the user experience. It's a lot of products have helped by engineers for engineers, and it's tough for someone like myself, I'm trying to play around with this stuff and figure it out. It's really tough to navigate. So maybe WisdomTree Prime is part of that. But first, at a high level, how do you see the overall UX evolving in general, maybe if you want to speak to WisdomTree Prime as well in terms of how end users will actually act.

I mean it's going to have to be competitive with your -- I don't know who you bank with, but whether it's your Bank of America app, your Chase banking app, it has to be your American Express, that's the quality that this has to be. It has to be easy, intuitive, secure, compliant. I mean this is a brain surgery, that's what it has to be. And for most investors, it won't be that they actually know that it's on the blockchain, except that certain functionality can only be accomplished because it is on the blockchain. But for the most part, it's not important to the consumer, except if you're delivering functionality that they want. And that, I think, will be one of the drivers to ramp growth.

And let me go off on a couple of tangents here what does this do for WisdomTree, but what does it do for the consumer. For WisdomTree today, we have one revenue source. It's fees, expense ratio. In this world, we open up additional revenue streams, will be transaction revenues, spread revenues, we'll have payments revenues. It also reduces cost because we take out middlemen. So we're able to offer better value to the customers. It also gives us an opportunity as an asset manager. One of the things that we'd love to do, like first-to-market beta is a great place to be. If you can be the first in gold or the first in the S&P, whatever, you get to be the benchmark, you get the lion's share of the assets. We started in ETFs, what, 15 years -- 13 years after the Spyder. So most first-to-market beta had been taken. So again, in this new wrapper, the whole landscape is open. So for us, it's very big what it can do for us, and it's a natural extension of what we do. For the consumer, okay, lower cost is good, but it's not only product, it's customer experience. And one of the things, and I'll go back again to my e-trade years, in brokerage, the brokerage part of the business, we made the most of our money, the most profitable piece of the business was customer cash. And on average, an average customer held 15% to 20% of their account in cash at all times earning next to nothing. So fantastic for the house, not really very smart of the customer. I always refer to that as dumb money. On the bank, it's the same thing. Banks make most of their money, the most profitable part of the bank is checking because it's there's -- everybody has too much in checking, it makes you feel better, you have too much in checking, earning nothing. Now, you go back to what is the blockchain-enabled financial services do for the consumer. I can spend my goal, I can spend my S&P, I can spend my S&P -- all of my assets are -- they're either there for savings, spending or investing. It blurs, as Jarrett said. So one of our first digital products that we're looking at is floating rate treasuries -- so I see floating rate treasuries as really a cash substitute that breaks the model of dumb cash because now there is no such thing as dumb cash. So it's got an incredible customer benefit. It's also great for us as an early mover. But we will be -- we expect to be the first in the United States with a regulated digital fund. And so we've got a first-mover advantage that is really exciting.

Great. Well, let's dig in a little more specifically to WisdomTree Prime. You mentioned this in beta. What does it look like exactly? Is it a digital wallet, a neobank, what's the value prop to the end customer?

Well, it is a mobile app. You'll download it from the App Store, you'll be able to be an ad with a bar code, you'll be able to go directly to hold down the app. It's a broad consumer finance experience of savings, investing in payments, all integrated. So I mean, in some ways, it's what exists today, so if you think about the traditional neo banks, they're competing on the same forum as JPMorgan and Bank of America, but with no real advantage other than they don't have physical branches. So they're focused on the mobile app, but so is Bank of America. So -- but they're on the old rail. The real thing is that we are on the new rail, we're native to the blockchain. And so there is the efficiencies that come with it that will be on a lower revenue capture than traditional banking, our earnings should be substantially higher because our cost of operating is lower. And so there is just an efficiency that comes from this. So I think there are certain functional experiences like loading rate treasuries as a savings application will deliver you a higher yield than a money market fund or your savings account. So that's a tangible benefit. And today, if it was in the market today, it would be maybe 75 basis points of more yield coming to your savings account, not insignificant, in my opinion, the ability -- for your versus a coin-based, the ability for your crypto to sit with traditional assets without seamlessly, very attractive to some degree, the ability to be able to do peer-to-peer transfers very, very -- I think when you see Apple marketing their iPhone, what are they marketing? The pixels. It's the camera is what the market. It's the full functionality. We'll find what are the killer apps, but I think that there are some truly -- it's more convenient with better functionality that exists on the old rails. Now, money is money. So we're not grain surgeons, but we are fiduciaries. This is not a joke. You have to be able to trust what someone does with your money. So I think here, we're not going to ask anyone to make any sacrifice from a compliance, a security, a safety experience. I mean it will be as good or better than what exists today because the new tech affords you that better functionality.

And we're beta testing this today, and we're looking for a national rollout in the first quarter.

Great. Well, we spent a ton of time in digital assets. Let me ask maybe a few more WisdomTree-specific questions. So maybe on M&A, you've done M&A in the past, both large-scale and tuck-ins. As you look at the business today, are there any areas you think it might make sense to increase your footprint or accelerate entry -- is it digital assets? Is it models? And maybe can you comment on your broader approach to capital allocation?

So yes, we've done -- it's very hard to imagine buying an ETF sponsor today. When we bought ETF Securities, we were able to -- it clicked a lot of boxes. It was highly accretive, truly diversifying both from an asset class, but also from a geography but accretive, not so easy to see deals like that today. I don't think we would go backwards and buy the old rail. So we're not going to buy a mutual fund company or anything like that. There may be some technology tuck-ins that would be constructive. We're certainly opportunistic. We kick a lot of tires, but we have a very specific vision. So M&A, I would say, is a secondary growth strategy for WisdomTree beyond our core organic growth rates.

Absolutely. I mean, just the same thing. We kick a lot of tires, but we want to make sure that there is a strategic fit that it speeds us on our way and that it's accretive.

Great. Maybe a question on sort of the activist investor in the stock. And however much you can possibly share? I think back in May, you announced a cooperation agreement. And as part of that, you have a few new independent Board members, you created an operations and strategy committee. What has that experience been like so far?

So we are an immensely transparent organization, I would say, we're the most transparent publicly traded financial service company. We also have a relatively simple business. We're purely before digital assets were exchange-traded products. That's what we do. We have -- as you referenced, we have 2 new directors maybe there, 2 or 3 months on our Board. We've created as part of the cooperation agreement, this operating and strategy committee. They -- it's made up of the 2 new directors and 2 old directors. They're meeting with management and our operating team digging deep on certain subjects. The activist themselves had made certain claims. These new directors are trying to uncover their own sense of what is true and what is not true. We've been highly engaged with them, very, very busy. And the committee itself will make formal recommendations to the full board towards the end of the year. I'm not sure it's -- from Jarrett and my perspective, it's just we have a lot of momentum in the core business. We have a very exciting digital asset, initiative. And we just don't want to let anything distract from the core business or the future business.

And going off of that, I mean, we've got best-in-class organic growth. We think the most exciting vision for the future. So yes, like what's the experience like and Jonas used this analogy internally. We feel like we're a very fit person, and yet we're going to the Mayo Clinic for the 3-day checkup. So it's not always the most comfortable thing in the world, but we expect to have a great review after the 3 days. It also does an interesting thing for us is there's no way we can be complacent. So we're constructive about this. It is what it is. It's here, but we're taking it constructively. So we're on the clock. We've got all of these visions. We've got all these plans. We've got to execute them, and that's the way it is.

Great. Maybe one final question here. I think last year, you launched over 20 new products aiming for maybe 20 more in 2022. We spent a lot of time talking about the digital asset side, but kind of apart from that, what's most exciting for you? Where you see the most innovation within the company? How important is all that for driving growth?

I think it's very important. It's new funds are lifeblood of the business. I think we have historically had a value bent. We've been using new funds, particularly in thematics to give us more of a growth equity bent. We've also been very aggressive in option-based strategy. So we -- 2 things. So we have a target range series as well as what we're calling efficient core, which is asset stacking, using leverage to own both stocks and bonds, replacing your 60-40, your old 60-40 in a more efficient manner. That suites become a $1 billion suite. But I think it's -- and then we've done a lot of crypto. I mean, new funds are really important. And the thing to remember about new funds is that you're thinking out to the future because a new fund that 99 out of 100 a fund that you launched this year is not going to knock the cover off the ball this year. Our USFR fund, U.S. floating treasury fund, it's been a great performer this year. We launched that 2014. The efficient core suite was launched previously, ex state-owned has been a great suite that was -- has had some great success. Those were launched, sometimes it's 2 to 3 years. So you've always got to be -- that's one of our things as being a pioneer and an innovator and it's just always part of it is being thinking -- being forward-thinking.

Great. Well, gentlemen, I'm afraid we're out of time. But again, thank you so much for being here.

What a pleasure and really appreciate it.