Ziff Davis, Inc. (ZD) Earnings Call Transcript & Summary

Okay. Great. I think we're live here. Hello, everybody. Thanks for being here with us today virtually. We're really excited to have Vivek Shah, CEO of J2 Global with us. If you have questions, please e-mail me at [email protected]. And for my disclosures, they should be under the window you're looking at, or you can e-mail me and I can send those to you after. So Vivek, thank you for being here.

I guess to kick this off, J2 Global has been around for a long time, but maybe for those who are new to the story, have seen the recent stock run-up, can you kind of walk through the 2 business units J2 Global operates in? And how those have evolved over time?

Sure thing, Nick. Well, it's great to be here. Thanks for having me. So you're right, the company has changed quite a bit. Really, in the last 8 years, the company has been public for about 20 -- a little over 20 years. Really, in the last 8 years, we have systematically built a portfolio of Internet businesses. The revenues in that period of time have gone from under $400 million of revenues to over $1.4 billion. And we do -- we organized the company in 2 segments. So we have our cloud services segment, which really is Internet-delivered software in the cybersecurity market, in the marketing technology market and then in cloud fax, which is the sort of historic legacy business at J2. And then the other segment -- and these segments are roughly half. The cloud segment's like $675 million of revenue. In the Digital media segment, it's about $750 million of revenue. And in the Digital Media segment, we're delivering Internet content, Internet-delivered content. And there, we're focused on high-value verticals, technology, gaming, shopping and health. So we operate a portfolio company. All of the businesses are Internet businesses, and it's pretty well diversified. Nick, I wish that could lip-read, but for some reason, I'm not -- there we go.

That's my fault. I was on mute. So I guess maybe unpacking a little bit and staying at a high level, what are the similarities between kind of the cloud segment and the media segment that makes them the most compelling to J2 Global's strategy?

Well, the first thing I'd say is that everything we do is digitally produced, it's digitally distributed, it's digitally sold. And so prior to the pandemic, our view on that was that we thought there were margin advantages in being entirely digital in orientation. We thought there were opportunities to employ people around the world and not be focused necessarily on specific markets and cities. During the pandemic, being entirely digital in orientation, I think, was an advantage because when we moved to remote work early, which we did and universally and have been in that stance, we were prepared to do that. There's no real physicality with respect to these businesses. Two is that recurring revenue is really the focus of all of these businesses. And so we have subscription revenues, which are about 60% of J2's overall revenues, and that is obviously highly recurring and visible. But our advertising business, which is the balance, the 40% of revenues, has as much a recurrence and visibility. About 94% of our advertising revenues come from existing customers. So we value revenues of that nature, and this is a kind of shared attribute across the portfolio. I'd say that all of these businesses are run with discipline. We're very focused on margins and free cash flow. And these businesses are run for free cash flow. And so to be in the portfolio, you have to have those characteristics. And then the last thing I would say is that all of these businesses are platforms for capital allocation and primarily around using acquisitions to drive accretive growth. As you know, a big part of J2's story has been leveraging acquisitions for accretive growth. And so those are many of the things. I'd also just say, from a skill set point of view, we often say we have typists, whether you're typing content or you're typing code, and it's a similar type of workforce that we employ.

Great. Great. Maybe switching gears a little bit to M&A, which is always a big focus for J2 Global. M&A is core to the strategy. We know there was a little touch and go early in the year as COVID kind of first, I guess, began unleashing on the world here. How are you thinking about -- or how should we be thinking about the M&A environment today? Are there more or less opportunities as vaccines begin to roll out here?

No. So look, we did take a hiatus, a self-imposed hiatus, Nick, as you know, for a pretty long period of time. And we did that for a few reasons. I think one is we felt that it was appropriate for us to focus on the existing portfolio of businesses and make sure that they were optimized and were running the way we wanted them to run and to be able to perform well inside of this environment. Two is we felt that price discovery during the height of pandemic was difficult. And we said, patience probably will be rewarded. And then I think, three, there were early concerns about diligence-ing, transacting and integrating entirely on a virtual basis. I think, in all respects, with the RetailMeNot acquisition in Q4, we addressed all of those, and we view ourselves as being fully back on the M&A front. We think that the pipeline, the current pipeline is not measurably different than the pre-COVID pipeline. There's a lot of activity. I could argue that there's more activity. And I think what you've got, you've got a number of companies for whom this environment has actually been quite punishing. And so I think they're trying to think about alternatives, and that obviously feeds well into our acquisition and M&A program. I think you've got larger corporates who are thinking about portfolio rationalization in an environment like this. And we've been quite successful at carve-outs and the complexity around carve-outs and what corporates are looking for from carve-outs. And so we think we're going to see some interesting opportunities in that way. And then, look, I think you've also got some venture fatigue in some businesses. So that combination of factors, we believe, contribute to, as a buyer, a fairly healthy environment for us from an M&A point of view.

Great. Maybe piggybacking a little bit on the RetailMeNot acquisition. So that was a sizable transaction during COVID. Can you touch on what you've learned by transacting remotely or virtually? And how might this change how you acquire from here? Is it possible J2 Global could acquire at a higher velocity from here now that you've kind of started leveraging some of these new tools that kind of COVID forced on us?

Yes. Look, I think we're very comfortable at this stage transacting virtually. The RetailMeNot transaction was the second largest in J2's history. And so we had a fair amount of learning in terms of how to approach it. And one of the things that I will tell you that's interesting is we find that the processes we're in are more data-rich today than pre-COVID. I think part of that is that during these processes, when you cut out a lot of the sort of interpersonal and relationship-building pieces, which are, of course, important, they're getting replaced by data. So we're just seeing richer data rooms, richer responses to data requests. And since we're very empirically driven, I view that as a net positive. And you also know that if the target is a company that struggles with dealing virtually, it's probably not a great fit. I think it's a parameter for us that the company be like we are, which is entirely able to work in this fashion for a long term because this is obviously a risk profile, if you can. So I think on all of that, I do, I think we've gained confidence. Now do I think it's been an accelerant? I don't know. I think I don't want to go that far. I think that we've returned to normalcy in terms of the cadence of deals. I certainly also think that -- and I mean, again, it depends on the situation. Expectations in some markets are unrealistic. And in other markets, they seem to be pretty appropriate. So -- but that's always been the case.

Maybe another one, just on acquisition size. So typically, we'd expect J2 to do a few -- several tuck-ins a quarter, RetailMeNot was much larger than a tuck-in. How should we think about acquisition size from here? Is there room for, I guess, a larger platform-like acquisition still?

Nick, so when we think about this, we don't think of it as much about the size of the deal. We think of it as the aggregate M&A spend in a year. And if you look at J2 over the last 5 years, we spend about, on average, $400 million a year on acquisitions, which is roughly equivalent to our free cash flow. And so generally speaking, we've said, look, we should aim to try to put our free cash flow to work in accretive acquisitions. In some years, as you point out, last year was one of those, we really just had 1 big acquisition. In other year -- and that happened in the year of Everyday Health also, which was 2016. And then in other years, you'll have a mix. And so to me, it's -- we run an internal competition for capital. You've heard me talk about this, which is, we have a highly decentralized company from an operating point of view, where each of our business units is led by a general manager who has full P&L responsibility for their business. But the free cash flows of those businesses all get centralized at corporate where we'll allocate capital for share buybacks and M&A and capital investment projects based on the most compelling opportunities and the projects and opportunities that will generate the most returns for us. And so really, what ends up happening is it's less about trying to fit -- trying to meet some measurement of how many deals we want to do or the size of the deals, it's really taking that free cash flow and funding the best available deals at that time. And it just so happened that in 2020, largely through our self-imposed hiatus and then the opportunity of RetailMeNot, which presented itself, that a bulk, if not all of our M&A spend, went to that 1 asset.

Great. Great. No, it's...

What I will say, Nick, is because I do get asked, well, would you do something bigger. And how do you think about that? I think we think that the bigger it gets, the stronger your conviction needs to be. That we likely wouldn't do anything north of 20% of our enterprise value, so that would be about $1 billion. And that we feel very comfortable in what we do right now, which is basically spending our free cash flow. But we're not shut off from a deal that could be twice that size. But it would have to be a special deal.

Got it. That's really helpful. I think now switching gears and focusing a little bit more on the segments. And I think that's kind of a good segue from talking about M&A. Now if we were to focus on cloud, can you touch on how investors should be thinking, I guess, about organic growth for this segment since we do see acquisitions across the various businesses. And what, if any, of those businesses are in managed decline today.

Yes. So from a growth point of view within the cloud segment, I would tell you, cybersecurity, martech and our corporate cloud fax businesses are all mid to high, in some cases, low double-digit organic growers. And so let me talk a little bit about each of those. The cybersecurity business, which is primarily our VPN and our endpoint business, we operate under the VIPRE brand and the IPVanish brand principally there. We see those as experiencing the tailwinds that a lot of cybersecurity businesses are experiencing with all of the attention around threats and the need for individuals and businesses to protect themselves. In these businesses, we have primarily consumer and small and medium businesses. So businesses that employ 1,000 or fewer employees, which we think is a really exciting space to be in. A lot of cybersecurity, investment and attention and energy and market focus has been in the enterprise with -- for obvious reasons, because it is a significant opportunity. But we think the need for SMBs is there and continues to grow. So we're -- we see potential there. Our martech business, which is principally iContact and Campaigner, really is around empowering businesses to generate online customers and online transactions and to be online. And we think that has some nice characteristics. Yes, the SMB landscape has struggled generally in the pandemic, but the move is towards establishing their digital businesses where we think we've got a really good opportunity. And then the corporate fax business is really a health care business, where we're helping to drive the move from basically on-prem analog faxing activity to cloud faxing, which is all around the movement of medical records. And so we think we're solving for the free -- the easily moved digital movement of medical records. Now in terms of -- so that's all growth and that has all organic growth characteristics to it. And it is an increasingly large part of the portfolio. We do have parts of the cloud business that aren't growing. The web fax business, which is sort of the historic legacy business, that declines low single digits. But in combination with the corporate fax business, the corporate fax business' growth more than offsets that so that we get to kind of a mid-single-digit growing proposition in overall fax. And what's interesting to note is the success of the corporate fax business is putting us that we're not far from them being equal in size. And that certainly wasn't the case a few years ago. So the success that we've had on the corporate side, which we think will only sustain, has more than offset any of the declines there. So we feel good about that as a package, and that is all run together as one business unit. The business that is being managed for decline is the B2B backup business where we've struggled. We've struggled to find M&A that we could frankly afford, that fits our M&A profile and our hurdles and our IRRs. It's a very frothy space. I think our ability to compete organically is challenging, and the investments we would need to make, we don't see the same kind of returns on those investments as we would see in other parts of the portfolio. And so for that reason, I would put those in the, what you call, the managed decline category. The good news is the B2B backup portion of the business only about $50 million of revenue. So considering we're north of $1.4 billion in annual revenue, it's fairly small as a drag. So that's the good news on that. But other than that, we think the rest of the portfolio on the cloud side really has a lot of potential and promise.

Great. Maybe drilling in a little bit on eFax and corporate fax. As things return to normal, what are your plans for that business? There's telehealth and med-tech innovations are arriving at a rapid pace. How should we think about eFax' place within the health care industry longer term?

Well, look, I think this pandemic has only accelerated what we always knew to be the case, which was that health care needed to embrace a cloud solution to the movement of medical records. Right now, 95% of the medical record volume that is sent around via the fax protocol are through machines, through on-prem, on-premises machines. That's going to move to the cloud, like everything else has moved to the cloud. We provide the leading cloud solution. And so a lot of our success has been those clients who, prior to the pandemic, understood they needed to make the move. And now during and, I certainly think, post pandemic will want to and will have to make that move. I think that the solution we provide which is to move medical records around securely, hits a lot of boxes. It's cheap. It is a very cost-effective technology solution for health care. It works. It's interoperable. It works across all platforms, whatever EHR, whatever EMR you're using, it works. That is a big deal, compatibility between these systems. And it's secure. And security of medical records, as you know, is law. It's the HIPAA set of regulations. So we think all of those things puts us in a really strong -- put us in a really strong position relative to the cloud fax business. We've had great traction on customer adds. We've been tested with some new customers at very high volumes to stress test the volumes of send and receive we could see, and we did very well. We're also building a suite now. So we have Consensus, so a lot of how we go-to-market now in the corporate space is under the Consensus brand. So Consensus brings the cloud fax capability of our company, but also adds to its secure direct messaging, patient query functionality and other tools that are a part of health care workflow. And so we think that makes us even more relevant inside the health care industry. And as we think about M&A in this space, by the way, we will think not just about sort of our traditional highly accretive move of acquiring fax customers from competitors, and there are fewer of those, I will admit, but now thinking about point solutions that sit alongside our cloud fax solution so that we can really build out that suite. So we're excited about it. And it's something that when I started in this role 3 years ago, I talked a lot about, and I think the performance of the last 3 years has been really extraordinary.

Great. No, that's really helpful, Vivek. Maybe switching to security and privacy, another large component of the cloud business. You had mentioned COVID kind of benefited this business. I guess, can you talk to how should we think about the new subs, one, within the segment? Are these cohort of subs going to be stickier? Are they maybe going to churn later this year as things -- the pain increases? How should we think about this business, the subs you've won and kind of how you're viewing this cohort?

Nick, I might clarify. So I think that the COVID impact was more about turning a lot of SMB mindset to the need, it didn't necessarily show up in customer adds. So the growth we're seeing there, I think, was pre-COVID ordinary course, the growth we're seeing in these spaces. We didn't get a COVID bump in this particular business. But what I think we did get is a bump in interest in the solutions, which I think will be one of these post-COVID benefits. Because, look, I think that, again, it's not that we're providing a work-from-home solution in security and privacy. Those are probably entities that provide work-from-home solutions that saw a bump. We provide security and privacy. And I think security and privacy have just increased in people's attention and the profile in terms of the news coverage and all of the hacking events and state-sponsored interference and state-sponsored breach of databases and systems and networks, I think, has brought a lot of attention to the problem. And I think that attention ends up being in our benefit. The other thing is we've organized to be a suite. So we were -- prior to this, we didn't have a single executive who is in charge just of these assets, which is the VIPRE endpoint, the VPN led by IPVanish and SugarSync and Livedrive, which are our file sync businesses, and figuring out ways to attach, to bundle and to cross-sell. And so that's in place now. And so we're seeing some revenue benefits in terms of selling units, we're seeing some ARPU benefits. And then in other cases, we're just seeing what we hope to be retention benefits of customers. We also believe that we have a marketing opportunity in this space that we operate here and in martech at quite attractive LTV to CAC ratios, where we have room to really profitably add more subscribers. So that's something we're thinking a fair bit about. And then the only other thing I would just say on security and privacy is that when you actually think about the J2 cloud portfolio, you have the security and privacy businesses that I've listed, but you could argue that the cloud fax business is also a security business. So a lot of what we're doing in cloud is really trying to solve security in a bunch of different ways.

Great. That's really helpful. Maybe switching gears to Digital Media here. The ad environment saw some pressures earlier this year, and then certain categories kind of rebounded quickly. So I guess, like performance marketing and kind of high context properties, how are JCOM's properties? How have they fared relative to the broader digital ad environment? How should we be thinking about the various digital media businesses from here, networking is -- and their ad-based gaming?

Yes. I think the performance of the advertising businesses at J2 in 2020 was pretty special. When you look at our Q2, if you'll go back to that, Nick, I think our advertising business was up 9% in the quarter. I don't know of any company, big or small, that could say that. So we did extraordinarily well in Q2. We repeated it in Q3. And I think we've got a few reasons why the advertising business has been as healthy as it's been and why I think it will continue to be healthy. First is we're very vertically driven. And so being in high-value verticals, tech, gaming, health, shopping, I think is -- tend to be the dollars that are last cut because they're the highest performing dollars. And by the way, as you know, Performance Marketing Solutions, where we sell on a cost-per-click lead or acquisition basis, was certainly the last to be cut. In many instances, you saw clients increasing the amount of CPC, CPL and CPA and taking away from the CPM advertising that they were doing in other places. So I think being vertically driven has been beneficial. One of those verticals, the health vertical, did very well. And the health vertical, which, by the way, is half of the display advertising portion of the business, was really pharmaceutical. It's less about the increased traffic at our health properties. Certainly, we saw increased traffic. I don't think it's a statement about inventory. I think it's a statement about pharma shifting from television and in-person marketing to digital marketing, both to patients and to providers and physicians. And we think that's going to continue. So the health vertical has been great. Then the only other thing that I would say is that, it's appropriate to bring it up today, is the amount of election advertising money that exists in the ecosystem that benefited everyone but us, we don't get election ads. So we've been able to deliver 10% advertising growth without the benefit of the election or the elections. And so that's been another extraordinary part of the business' performance this year.

Great. No, that's really helpful on how to think about the ad business here. Maybe switching to RetailMeNot. When we discussed this on earnings call, there's -- you had mentioned kind of a shrink-to-grow strategy. Can you provide any color on the progress here? How we should be thinking about this newly acquired asset and that strategy?

Well, the good news is, in the holiday season, there was no shrinking, actually, there was only growth, which was not what we had been planning. So we saw growth in our gross merchandise sales at RetailMeNot and the take rate, and therefore, the revenue. So we had a very good and surprising holiday season and experience. And so look, I think that going into next year, when we talk about shrink to grow, I don't want to overstate it, it's really a margin expansion exercise where we will give up on some nonprofitable revenues, and we're on pace to do exactly what we thought we were going to do. But really, I think I would encourage everyone to really understand where we think the true longer-term value creation is going to be. And I think some of that is going to be in the take rate opportunity we see. As I mentioned on my call, the pre -- or the assets that we own in this affiliate commerce space prior to RetailMeNot, we would generate a 10% commission. RetailMeNot generates on average a 4% commission, and we think we can improve that 4%. So we think helping increase that take rate will be a driver of value creation. The other thing that I would say is that we see some really interesting opportunities, organic growth opportunities in Deal Finder, which is a browser extension product, which competes with Honey, as well as with our mobile app. And so those are 2 areas that have been growth areas, but we think we can very much accelerate growth through user adoption, leveraging our media properties to bring awareness to these and drive installs of both as well as merchant participation. And that's just investing in the business to do what I think needs to get done. And this is a space we know very well. We own Offers.com. We own BlackFriday.com and a number of Black Friday sites. As you know, PCMag, BabyCenter, Mashable, IGN, all engaged in affiliate commerce business models. And so the aggregate -- I think the aggregate gross merchandise value between RetailMeNot and our existing properties is over $5 billion of annual sales that we generate for which we get paid a commission. So look, I think that this is wheelhouse for us. It's an asset that, honestly, we've been tracking -- that I've been tracking for 10 years, and we're glad to have it in the stable.

Great. Maybe switching gears a little bit. You mentioned IGN. Can we touch on Humble Bundle? And maybe quickly to investors who are unaware kind of the presence J2 Global has in gaming. Can you maybe explain kind of quickly what Humble Bundle is and kind of the 3 components of that? And what kind of engagement have you been seeing with IGN and the Humble Bundle products as COVID continues to persist?

Well, Q4 has been good, as we had predicted, because of the console timing. So we talked all year about, look, the consoles are coming in Q4. They generate a ton of activity and new publishing titles. But specifically on the Humble Bundle question, 3 things, it's a store. So you can buy individual games and bundles of games, which is where the name Humble Bundle came from. And that does well. And then we have a publishing business where you pay, call it, $12 a month and you get a bundle of games. You get a group of games, and that's done reasonably well. And that's been a long -- that's been a driver of the growth since we acquired the asset a couple of years. But the part of the business that I'm actually most excited about, I'm excited about all of it, but I'm excited about the publishing piece of the business. This is where Humble Publishing works within the developers and finances the production and marketing of games. And that has proven to be very successful for us. If you look at the games that we have been the publisher for and therefore underwrote what we serve as publisher, we've seen 2.5 to 3x return on our investments within 18 months. So the return profiles are extraordinary. The volume of games that we think we can finance are far more than what we've been doing. And so we are working to expand our infrastructure to expand the publishing business. And we have an advantage in the publishing business, by the way. That 2.5 to 3x return is just on unit sales for the titles that we launch. I don't include the benefit I get from including those titles into my subscription business, where it starts to replace titles that I have to pay for. So I pay third-party publishers to have their title in my bundle. I increasingly pay less because I'm putting my own titles in my own bundle. And that becomes a second sort of monetization window for our games that I think becomes really compelling. So very excited for that and look for more from us in the publishing space.

Great. And maybe another component within the media business, Ekahau and Ookla, which is Speedtest, Ekahau with networking. I imagine Speedtest is really important to many of us stuck at home. I know I use it many times. Can you touch on interest in those products, maybe particularly Ekahau as the corporates were shut down and some networking became a little less important? Is that coming back? Any color there would be great.

Yes, Ekahau is definitely -- yes, so usage of Speedtest is off the charts. The value and the quality of the data inside of Speedtest is very compelling to obviously all broadband sellers who are trying to keep up with all of the demand, particularly at home. But the Ekahau business did face some near-term headwinds as physical locations shut down. But as they reopen, the requirements around WiFi redesign and deployment, and as these workspaces change actually is going to be a benefit for us. So we're excited for it. We have the next -- the sixth generation of WiFi, WiFi 6 is coming. WiFi 6, we think, will be a nice revenue opportunity and event for us where it will stimulate a lot of interest in Ekahau software. So no, we're very bullish about the broadband businesses.

Great. Great. Maybe touching on health care a little bit, right? So J2 Global has eFax, which is very much a health care business, and Everyday Health. So you're kind of periphery of health care IT, there's MedPage. Are there opportunities for J2 Global to potentially participate more squarely in health care IT? Or is this a sector where the multiples are a little too high, maybe the barriers to entry a little too high to kind of fit into J2 Global's M&A strategy?

Yes. As you ask it, Nick, I'm laughing. I think the real trick here, Nick, is for us to get an HCIT multiple on our businesses, which you rightly describe as being HCIT, and we get far from it. So no, look, I think the multiples, we're probably not a buyer of a lot of those businesses. But we think the businesses we have are very good, and they're performing well, and I think ought to garner a broader market understanding and appreciation for what they do and how they're performing.

Great. So you pointed to valuation. On the last earnings call, you presented a slide showing how J2 is trading multiples or a substantial discount to historic averages and highs. With the stock up substantially by, I think, about 30% since then, do you think it's sufficiently rerated? Or how should we be thinking about valuation today in your eyes?

No. I mean, listen, I think that from peak to trough, the stock fell 50% this year. It's up 80% off of that low. That doesn't put us even back to where we were pre-COVID in terms of value and per share price. And yet you look at our guidance today for the year and the pre-COVID high end of guidance, we exceed with the midpoint of our current guidance. So we're performing better in a more challenging environment. And if you look still at the trading multiples and whichever one you want to choose, we're still below averages, but I think we should be testing highs. I really do think that if you take the moment to explore what the company has done in Q2 and Q3, and obviously, in February, we'll be reporting Q4 and our guidance for 2021, I think that, increasingly, I think people are understanding that we are still undervalued. And I think it's our jobs to continue to communicate all the things that are going on at the company and the ways in which we're executing. And I think 2020 is a great example. Without much M&A, certainly nothing until RetailMeNot, you got to see how the company could perform. Because I've heard, well, can you guys grow without M&A? And the answer is we've always said we can grow with M&A and we can grow without M&A. And so that's been proven.

Great. So maybe piggybacking off that a little bit. Can we touch on capital allocation. I mean M&A is a big part of the strategy, we covered that. 2 million shares are repurchased in 3Q. I think there's about 8 million remaining. How should investors be thinking about the buyback and capital allocation, I guess, given, one, the pipeline, and two, the recent kind of stock run?

Yes. Look, so share buybacks was added to our capital allocation suite of choices in my tenure. So when I took over the job 3 years ago, I felt that share buybacks needed to be in there competing with capital projects and M&A. And it should all be done on an internal rate of return basis, like where can we get the best returns on invested capital and our own share should be part of that competition for that capital. And so in the time that I've been CEO, we bought back about 4 million shares at, I think, an average price of about $73. So the returns have been great. And so that's how we're going to look at it. We're not -- we don't buy back shares to just buy back shares systematically and programmatically. We buy back shares when we see investment potential and where it competes and frankly exceeds maybe the potential of some of the other choices. So it will continue to be a choice. It is a competitive process and we will stay disciplined in that. But we've increased our capital projects, too. I mean, we're investing more than buybacks and M&A. We've been investing in the businesses themselves, too.

Great. Great. So I know we're about up on time. And I guess we have one more question. And just one of my favorite ones I always like asking you. And we always talk about M&A but not many people ask about divestitures. But J2 Global has made some small divestitures in Australia and New Zealand in 2020. How should investors and we be thinking about, in 2021, potential for divestitures? Is there room to make divestitures enabling J2 to invest in more exciting areas this year?

Yes. So look, when we think about divestitures, generally, we're thinking about divestitures for businesses that we think can't compete internally for capital. They're not going to be able to get M&A capital. They're not going to be able to get investment capital because there are better uses of the capital. And that's what happened in the assets that we sold in 2020. They just couldn't compete for capital. It wasn't that they were bad businesses. But it's just that in our portfolio, they weren't getting what they needed. And so putting them in a place where they could get what they needed, we thought, was the right thing to do. So we continually look at that. And so we look at divestitures as a tool when that situation presents itself. Look, we're always open-minded. We're open-minded in really anything that helps improve the per share price of J2. So we don't sit here and not keep an open mind on ways in which we can unlock value as well. So if there are -- those opportunities presented themselves, we would engage in that, too.

Great. Well, I think that brings us to the end here, Vivek. Thank you so much for being with us here virtually. Hopefully, we get to do this in person soon.

I hope so, Nick. Thank you so much. I appreciate it.

Great. Well, take care, everybody.