The document discusses HubSpot's position in the customer relationship management (CRM) and inbound marketing software space. It highlights HubSpot's growth strategy of focusing on the mid-market customer segment and expanding its leadership position. It also notes various risks and uncertainties that could affect the company's projections around revenue growth and market opportunity. Financial metrics are provided showing increases in key metrics like revenue, customer base, and average subscription revenue per customer over recent years.
2. 2
This presentation includes certain “forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995,
including statements concerning our position to execute on our growth strategy in the mid-market, and our ability to expand our leadership
position and market opportunity for our inbound platform. These forward-looking statements include, but are not limited to, plans,
objectives, expectations and intentions and other statements contained in this press release that are not historical facts and statements
identified by words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" or words of similar meaning. These
forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based
on the information currently available to us and on assumptions we have made. Although we believe that our plans, intentions,
expectations, strategies and prospects as reflected in or suggested by those forward-looking statements are reasonable, we can give no
assurance that the plans, intentions, expectations or strategies will be attained or achieved. Furthermore, actual results may differ
materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond our
control including, without limitation, our history of losses, our ability to retain existing customers and add new customers, the continued
growth of the market for an inbound platform; our ability to differentiate our platform from competing products and technologies; our ability
to manage our growth effectively to maintain our high level of service; our ability to maintain and expand relationships with our marketing
agency partners; our ability to successfully recruit and retain highly-qualified personnel; the price volatility of our common stock, and other
risks set forth under the caption "Risk Factors" in our Quarterly Report on Form 10-Q filed on August 6, 2015 and our other SEC
filings. We assume no obligation to update any forward-looking statements contained in this document as a result of new information,
future events or otherwise.
Safe Harbor
14. 3M companies
X $10,127/year
>$30.4 Billion
Total Addressable
Market
1 – 10
employees
10 – 2000
employees
2000+
employees
-3.0M is US, CAN, and Europe. 1.6M mid-market businesses with a web presence in the United States and Canada. 1.4M mid-market businesses with a web presence in Europe.
-AMI Partners data, 2014. Avg. Subscription Revenue per Customer from Q2’15 14
15. The Power of Inbound
Screenshot from HubSpot product, 7/27/15 15
17. The Inbound
Movement
Available in
9 languages
10,000+
Conference Attendees
2,500+
Partners
125,000+
Members
Trained and certified
17,000+ professionals
2.0+ million
Monthly Visits
BLOG
17
Stats as of July 27, 2015.
18. HubSpot customers
see an average
5.7x increase
in lead generation
after 12 months
Source: Internal Analysis of >3,000 customers, 2014
Month 1 Month 12Customer Age In Months
18
23. Key Financial Metrics
Key financial
metrics
2011 2012 2013 2014 Q1’15 Q2’15
Gross Margin 61% 70% 65% 70% 73% 75%
% of revenue
R&D 27% 19% 18% 17% 15% 15%
S&M 82% 66% 67% 63% 57% 56%
G&A 21% 16% 19% 18% 17% 16%
Operating (Loss) /
Income %
(69%) (31%) (39%) (28%) (16%) (13%)
All percentages for historical period are non-GAAP and exclude expenses associated with stock based compensation and amortization of acquired intangibles.
Please refer to the end of this presentation for a reconciliation of GAAP to non-GAAP figures. 23
27. Sidekick.
A free, lightweight set of inbox productivity tools
that sales folks will love.
• Track email opens & clicks,
schedule emails, and leverage
templates right from your inbox
• Surfaces useful details about the
contacts & companies you are
communicating with
• Connects to HubSpot Marketing,
Salesforce or HubSpot CRM
• Free, $10 & $ 50 user/month
versions
27Screenshot of Sidekick product, March 2015.
32. GAAP to Non-GAAP Reconciliation
32
HubSpot, Inc.
GAAP to Non-GAAP Reconciliation
$ '000s
% of
Revenues $ '000s
% of
Revenues $ '000s
% of
Revenues $ '000s
% of
Revenues $ '000s
% of
Revenues $ '000s
% of
Revenues
Cost of Revenue
Subscription* 4,964 17% 9,689 19% 18,745 24% 23,655 20% 5,668 21% 7,484 17%
Stock-based compensation (16) 0% (27) 0% (50) 0% (128) 0% (24) 0% (92) 0%
Amortization of acquired intangibles (130) 0% (224) 0% (359) 0% (118) 0% (43) 0% (19) 0%
Non-GAAP subscription* 4,818 17% 9,438 18% 18,336 24% 23,409 20% 5,601 21% 7,373 17%
Professional services and other 6,368 22% 6,004 12% 8,759 11% 11,425 10% 2,614 10% 3,789 9%
Stock-based compensation (131) 0% (100) 0% (211) 0% (498) 0% (83) 0% (347) -1%
Amortization of acquired intangibles - 0% - 0% - 0% - 0% - 0% - 0%
Non-GAAP professional services and other 6,237 22% 5,904 11% 8,548 11% 10,927 9% 2,531 9% 3,442 8%
Gross Profit
Gross Profit* 17,221 60% 35,911 70% 50,130 65% 80,796 70% 18,816 69% 31,668 74%
Stock-based compensation 147 1% 127 0% 261 0% 626 1% 107 0% 439 1%
Amortization of acquired intangibles 130 0% 224 0% 359 0% 118 0% 43 0% 19 0%
Non-GAAP gross profit* 17,498 61% 36,262 70% 50,750 65% 81,540 70% 18,966 70% 32,126 75%
Operating Expenses
Research and development 10,031 35% 10,585 21% 15,018 19% 25,638 22% 4,948 18% 8,158 19%
Stock-based compensation (2,341) -8% (739) -1% (691) -1% (6,190) -5% (153) -1% (1,629) -4%
Amortization of acquired intangibles - 0% - 0% - 0% - 0% - 0% - 0%
Non-GAAP research and development 7,690 27% 9,846 19% 14,327 18% 19,448 17% 4,795 18% 6,529 15%
Sales and marketing 24,088 84% 34,949 68% 53,158 68% 78,809 68% 17,094 63% 26,291 61%
Stock-based compensation (647) -2% (691) -1% (1,194) -2% (5,596) -5% (475) -2% (2,077) -5%
Amortization of acquired intangibles - 0% - 0% - 0% (20) 0% (7) 0% (7) 0%
Non-GAAP sales and marketing 23,441 82% 34,258 66% 51,964 67% 73,193 63% 16,612 61% 24,207 56%
General and administrative* 7,517 26% 9,117 18% 16,204 21% 24,958 22% 5,051 19% 8,541 20%
Stock-based compensation (1,484) -5% (958) -2% (1,318) -2% (3,946) -3% (441) -2% (1,497) -3%
Amortization of acquired intangibles - 0% - 0% - 0% - 0% - 0% - 0%
Non-GAAP general and administrative* 6,033 21% 8,159 16% 14,886 19% 21,012 18% 4,610 17% 7,044 16%
Loss from Operations
Loss from operations (24,415) -86% (18,740) -36% (34,250) -44% (48,609) -42% (8,277) -31% (11,322) -26%
Stock-based compensation 4,619 16% 2,515 5% 3,464 4% 16,358 14% 1,176 4% 5,642 13%
Amortization of acquired intangibles 130 0% 224 0% 359 0% 138 0% 50 0% 26 0%
Non-GAAP loss from operations (19,666) -69% (16,001) -31% (30,427) -39% (32,113) -28% (7,051) -26% (5,654) -13%
* Amounts have been adjusted from prior SEC filings for reclassification of customer credit card fees from cost of revenue, subscription to general and administrative expenses to conform with current year's presentation,
Three Months Ended
June 30, 20152014
Year ended December 31,
2011 2012 2013
Three Months Ended
June 30, 2014
33. HubSpot CRM.
Say goodbye to manual tasks and confusing
features. Say hello to HubSpot CRM.
• Stores a companies’ most
important prospect & customer
data
• Designed with ease of use for
small companies in mind
• Optional integration with HubSpot’s
Marketing platform and Sidekick
• Free product anyone can use,
integrates seamlessly with paid
add-ons (Sidekick)
33Screenshot of CRM Product, March 2015.