Bob Whitman - Chairman, Chief Executive Officer Steve Young - Chief Financial Officer Paul Walker - President, Chief Operating Officer Sean Merrill Covey - President, Franklin Covey Education Jen Colosimo - President, Enterprise Division Derek Hatch - Corporate Controller

Welcome to the Q3, 2021 Franklin Covey Earnings Conference Call. My name is Adrienne and I’ll be your operator for today’s call. [Operator Instructions]. Please note this conference is being recorded. I’ll now turn the call over to Derek Hatch, Corporate Controller. Derek Hatch, you may begin.

Thank you, Adrienne. Good afternoon, ladies and gentlemen. On behalf of Franklin Covey, I would like to welcome you to our conference call to discuss the third quarter of fiscal 2021 financial results and hope everyone is having a great summer. Before we begin this presentation, we’d like to remind everyone that this presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based upon management’s current expectations and are subject to various risks and uncertainties, including, but not limited to, the ability of the company to stabilize and grow revenues; the acceptance of and renewal rates for our subscription offerings, including the All Access Pass and Leader in Me memberships; the duration and recovery from the COVID-19 pandemic; the ability of the company to hire productive sales professionals; general economic conditions; competition in the company’s targeted marketplace; market acceptance of new offerings or services and marketing strategies; changes in the company’s market share; changes in the size of the overall market for the company’s products; changes in the training and spending policies of the company’s clients and other factors identified and discussed in the company’s most recent annual report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission. Many of these conditions are beyond our control or influence, any one of which may cause future results to differ materially from the company’s current expectations, and there can be no assurance the company’s actual future performance will meet management’s expectations. These forward-looking statements are based on management’s current expectations and we undertake no obligation to update or revise these forward-looking statements to reflect events or circumstances after the date of today’s presentation, except as required by law. With that out of the way, we’d like to turn the time over to Mr. Bob Whitman, our Chairman and Chief Executive Officer. Bob.

Thanks very much, Derek. Good afternoon, everyone. We are happy to have the opportunity to talk with you today. Really appreciate you joining us. We’re pleased to report, as you saw in the press release that our third quarter results were strong, and even stronger than expected. And we believe this again reflects the strength, power, quality and durability of our customer value proposition and of the high growth, durable subscription business model that we have created. Just some highlights. As shown on slide three, revenue was up 58% in the quarter and it was also greater than fiscal ‘19’s strong third quarter. Gross margin percentage was up 587 basis points. Our operating SG&A as a percentage of sales improved to 63.6%. Adjusted EBITDA increased $12.2 million in the quarter to $8.6 million. Our net cash from operating activities increased 65% to $30.9 million, and we ended the quarter with $51 million in liquidity even after making a major investment in the acquisition of Strive. Just want to provide a little more detail on each of these key highlights. Revenue in the third quarter was $58.7 million, which obviously represented a big increase compared to the $37.1 million of revenue in last year’s third quarter, which of course was impacted by the COVID pandemic. Importantly though, this $58.7 million of revenue was not only significantly higher than the last year’s third quarter, it was also higher than the $56 million in revenue achieved in the strong third quarter of fiscal ‘19 pre-pandemic, which itself represented a big increase compared to the $50.5 million revenue achieved in the third quarter of fiscal 2018. This strong growth was driven primarily by the strength in growth of All Access Pass and also with our subscription business and education, All Access Pass, you see…

Hey! Thank you, Bob, and good afternoon everyone. It’s nice to be with you, so I’ll just jump right in. As shown in slide 12 and as Bob talked about, our performance for the third quarter was stronger than expected and showed positive momentum on almost every front. As you know, our adjusted EBITDA for the third quarter was $8.6 million, an increase of $12.2 million compared to last year’s third quarter of negative $3.6 million and the amount substantially exceeding our expectation of adjusted EBITDA of between $4 million and $4.5 million. Importantly, this $8.6 million in adjusted EBITDA is also significantly higher than the $3.1 million of adjusted EBITDA achieved in the strong third quarter of FY ‘19. As also shown, both year-to-date and last 12 months adjusted EBITDA substantially exceeded that achieved in both FY ‘20 and FY ’19, and our last 12 months adjusted EBITDA of $26.3 million, as Bob said, it substantially exceeds our full year guidance of $20 million to $22 million for FY ‘21. Our cash flow and liquidity position also increased significantly. As you can see on slide 13, our net cash generated year-to-date through the third quarter was $11 million. This was $23.2 million higher than the negative $12.2 million of net cash generated in the last year’s third quarter and was also higher than the negative $4.8 million in net cash generated in FY ‘19 and this negative $7.2 million generated in FY ‘18. This increase in net cash generated reflects strong growth in adjusted EBITDA, and that our balance of billed and unbilled deferred revenue increased by almost $17.1 million or 25% to $96.6 million in the third quarter. Also as shown in slide 14, our cash flows from operating activities year-to-date for the three quarters ended in May…

Thanks Steve; Just a couple of points on looking forward. As we’ve discussed, substantially all our growth has been driven by growth in All Access Pass subscription and subscription services sales and the strong growth has continued throughout the pandemic. So we’ve shown and we expect All Access Pass to continue to drive in the future. So driven, we expect really that substantially all of the company’s sales will be subscription and subscription services within three to four years as we mentioned last quarter. Thought we’d give you a little background as the three bullet points as to why we think that’ll be the case. First, the growth, we expect All Access Pass subscriptions and subscription sales to continue to increase in our Enterprise Division in North America where those sales already account for 82%. As shown in slide 18, All Access Pass subscription and subscription services sales represented only 13% or $13.7 million of total sales in North America in 2016 when we first introduced the All Access Pass. Dramatic sustained compounded growth since then is really in All Access Pass and subscription services sales increasing to $103.2 million for the latest 12 months through this year’s third quarter. From reports that have been sent to us by others achieving $100 million in subscription and service revenue in only five years, it places us among a relatively elite group of SaaS companies actually with the media and time for those who actually make it to $100 million being around nine years. And as shown on slide 19, All Access Pass subscription and service sales now accounts for 82% of sales in North America with the continued expectation of double digit growth in All Access Pass revenue, and with legacy sales now at very low levels and expect it to…

Thanks Bob and hello everyone. Good afternoon. I’ll briefly describe these three factors and then go into just a bit of depth on each. The first factor that we expect will continue to drive this significant growth in our subscription sales and profitability is that the already significant lifetime customer value of our All Access Pass holding organizations will continue to increase. The second factor is that as we continue to aggressively grow our salesforce and our licensee network, the volume of new high lifetime value All Access Pass logos will accelerate. And third, the recent acquisitions of Strive and then Jhana, which you’ll recall that we acquired in mid-2017. Together, they’re accelerating our ability to address larger and larger populations inside new and existing All Access Pass clients, further helping to accelerate the growth of the pass inside those organizations, and so just briefly discussing and describing these three in a bit more detail. First, All Access Pass and subscription services revenue will continue to climb and that will drive increasing lifetime customer value. As shown in slide 20, in our North American operations All Access Pass has first, a relatively large and continually increasing average pass size now at $43,000, which is up from $37,000 just a year ago. Second, an annual retention rate greater than 90%, which has been true all the way through the pandemic; and third, a subscription services attach rate of 48%, up from just 70% a few years ago. The combination of revenue from the All Access Pass subscription itself and from attached subscription services totaled approximately $61,000 per Pass holding customer in the third quarter, which was up 13% from $54,000 just a year ago. The blended gross margin on all of this continues to be greater than 85%, and these strong…

And Paul, thanks so much, and I’ll turn it to Steve to talk about our guidance and outlook.

Okay, thank you again. So as you know, in the past quarters we have confirmed our guidance that we expected to generate adjusted EBITDA of between $20 million and $22 million this year. Based on the strong performance in the third quarter and year-to-date and our expectations of a strong fourth quarter, we’re glad to now be in a position to adjust that guidance upward. Our new guidance is that we expect adjusted EBITDA for FY ‘21 to be between $24.5 million and $26.5 million. The middle of this range would reflect adjusted EBITDA growth of more than 75% compared to the $14.4 million of adjusted EBITDA achieved in last year FY ‘20. With our last 12 months adjusted EBITDA through the third quarter already at $26.3 million, if our fourth quarter result is at least the same as last year’s strong fourth quarter, our results to the fourth quarter would already be at the, near the top end of that range, and we do expect to achieve strong growth in revenue in the fourth quarter. However, we’re also making some significant growth investments and will incur other costs in the fourth quarter that will partially offset the adjusted EBITDA growth we could otherwise expect from our expected growth in revenue. These growth investments include the hiring of a significant number of new client partners to position ourselves for strong growth in FY ‘22 and beyond. Two, some new strategic marketing investments that we expect will broaden our reach. Three, costs associated with the acquisition of Strive. Four, and some other growth investments. We also expect that there will be some extra site coming out of the pandemic cost, including some increased travel and profit-based compensation which will impact cost in the fourth quarter. These additional investments notwithstanding, we still expect the fourth quarter to be a very strong quarter. As for our outlook for FY ‘22, ‘23 and beyond, in the past quarters we have said that we expected adjusted EBITDA in FY ‘22 to increase to approximately $30 million and adjusted EBITDA in FY ‘23 to increase further to approximately $40 million. Based on the strong performance in FY ‘21 to-date and expected through the fourth quarter, we now expect the trajectory of our results in FY ‘22 and FY ‘23 will also be somewhat higher than our previous outlook. We expect it to increase and provide more detail on our outlook for future years when we report year end results in November. So Bob, that’s guidance and outlook. We’re excited about the future.

Great, thanks so much Steve. We feel great about our momentum; pleased to be in a position to increase our guidance and really excited about the business. Just before we turn to Q&A, I’d like to thank our absolutely tremendous associates around the world for their continued and unwavering commitment to our mission, to our clients and the excellence in all they do, they are amazing. I would also like to recognize and thank our great leaders. Our top leadership roles are all filled by extremely talented, experienced and committed individuals who have the combination of a long tenure, and yet because of the relatively young age many years of strong service still ahead of them. They lead in a way that engages their teams and predictably grows their operations and our overall business strategically, culturally and financially. I’m thrilled that given the strong results, trends and strategic position of Franklin Covey’s business, we are now prepared to make some key promotions on the executive team that will help to further accelerate our progress. I’m really excited about each of these. Our executive team has functioned as a true partnership for many years and our goal has been to have each leader continue to increase his or her responsibilities while still keeping all members of our executive team kind of on the playing field and contributing in both old and new ways, even as the rules change. That will continue to be the case following the key leadership promotions that will take place effective September 1. First, over the past couple of years Paul Walker has overseen substantially all our day-to-day operations, and I have focused the majority of my efforts working closely with Paul, Steve and the executive team on our key strategic initiatives, our innovation strategy and agenda…

Thank you. [Operator Instructions] And our first question comes from Andrew Nicholas from William Blair. Your line is open.

Hi, thank you. Good afternoon and congratulations to each of you; Jen, Bob and Paul on the new roles. I guess to start, in terms of the guidance and the guidance change, you touched on the increased spending in the fourth quarter. So I was hoping you could spend a little bit more time on exactly what those investments are. I know Steve you listed them, but if we could get maybe a few examples of what those spending initiatives look like. And then relatedly, is there any way to quantify that spend and should we view that as kind of a one-time set of initiatives or are these kind of a multi-quarter spend that you’re kind of leaning into growth with?

Thanks Andrew, I’ll try to give you a little more context and then invite Paul and Steve to add on. I think there is some in both categories. The general ones that we always do are the continued investment in client partners. It’s a little bit more back-end loaded this year, because we didn’t hire as many in the first half and therefore we’re adding more in this back half. So we have more of those folks coming on in the fourth quarter than we might normally have. We are also kind of a one-time expenditure in some marketing initiatives. We’ve been working with some firms and these aren’t big dollar amounts, I mean but incrementally the combination of the marketing which is maybe $0.5 million of extra and involve – really increasing our footprint around the world in thought leadership and some things that we’ll be announcing later this year, these are really kind of the outsourced work that we’ve been doing. Our client partners incrementally are adding maybe $0.5 million or so in the fourth quarter. I think the ones that are just more one-time or is it – in last year’s fourth quarter we had reserved a bunch for compensation and profit sharing and so forth, so the – most of our compensation is tied to results and because of the overall results for the year, we’re going to be lower because of the pandemic. We reversed some of those things in the fourth quarter this year. The offers will be true and so that’s a more meaningful couple of million dollars swing between those two and I think those are the primary things. We also have some travel coming back, you know not a lot, but there is some coming back as offices open and clients expect you to be there and see them and so those expenses will come back a little more than they were in last year’s fourth quarter and that will be somewhat ongoing. But basically the thought is that it’s possible that the fourth quarter could be higher than the end of our top of our range, but we do have some expenses relating to those areas that we’re talking about in the fourth quarter. Is that helpful at all?

Yes, very much so, thank you. Maybe for my follow-up, switching gears a little bit. I know you touched on it in your prepared remarks, but I was hoping we could spend a little bit more time on Strive. I think more specifically you mentioned the ability to target large groups. Can you flush that out a little bit further? And then maybe bigger picture question. If you could just kind of go through the top one or two things that Strive brings Franklin Covey that maybe you’re most excited about.

Sure. Paul, would you like to take that?

Sure. Hi Andrew! So I guess at the beginning, in addition to some of the increases, the costs that we’ll pick up in the fourth quarter that Bob mentioned, there are some costs related to the integration of Strive as well and getting prepared to come out in our next fiscal year with Strive in a big way. But to answer your question specifically, so we’re very excited about Strive. Strive is a platform upon which we think more effectively distributed administer provides access to our solutions to clients, and so if you think in the past, we’ve had a great platform with All Access Pass, and on that platform we pull in from disparate pieces. We pull in our ability to tap people experienced content, our assessment capability, we pulled Jhana into that and there is a constellation of resources and services that we provided clients on that platform. With Strive, they’ve been out there in the last few years as a start-up focused primarily in the leadership space, and they weren’t a content company first, they were a platform company first and they created a platform that’s even better than what we’ve had just inside the All Access Pass portal, where users – administrators can deploy content to larger populations. Their focus was on driving behavior change through technology. Our focus is on driving behavior change through the great content solutions we have, and so we marry these two things together and our clients now can say what are the one or two things. It’s really the user experience and the outcomes that organizations will achieve as our content now runs on the Strive platform. It will be easier, it will be even more digestible; we’ll be able to provide metrics in real time; the engagement will be even higher. Both when organizations are trying to deploy something to thousands and also when individuals themselves are going in, working on their own skill development. So think of it as, in a way kind of like what Peloton did, combining the bike, the instructor, the live sessions, the metrics, the social aspect of that all into one seamless system, Strive is going to help us bring all of that together in our use case, which is around learning and driving behavior change at scale.

Perfect! Well, thanks very much and again, congrats on the new role!

Thank you.

Thanks Andrew.

And your next question comes from Jeff Martin from ROTH Capital Partners. Your line is open.

Thanks. Good afternoon guys. And Paul, congratulations!

Hey Jeff!

Well deserved! And Bob, that was a nice way to introduce that too, and so compliments to you on what you put together there.

Thanks Jeff. It’s always good to be in partnership, so.

I wanted to jump in here. You know third quarter was an impressive quarter to start out. Was there any particular areas that were stronger than what you had thought, maybe new logos, may be higher average customer spend. You know what were things that you know surprised you to the upside in the quarter and what does that implicate for the future?

Paul, do you want to take that?

I’ll share one or two and then Jen, please jump in and Education to Sean. So Jeff, I think a couple of things that were pleasantly surprising, and we had high expectations already, but even came in higher. One was new logos. That metric continues to climb forth every quarter. You would recall during the pandemic we reported that actually new logos, that was an area where I wasn’t quite sure what was going to happen, in the darkest days of the pandemic and new logos really hung in there quite well and we’re seeing an acceleration there. And the other as we mentioned, we had a fantastic subscription service this quarter. And I’ve had – the more we get into this, the more I think even as we come out of the pandemic and certainly some of our clients will want to go back and have us come on-site again in person. I think the fact that the world has shifted and we can do both, we can do live online and live in-person, I think it’s going to continue to lead to greater demand for services overall, and so I think there’s some of that driving the increase in services business. And then the third leg of that stool is client expansion or retention was great also in the quarter. So the combination of those things really helped on the revenue side, and of course that business as we talked about is it’s a high margin business. So we’re continually as more and more of the business converts to All Access Pass with the high margins, that flows through to the bottom line and is driving both revenue and EBITDA. Those would be at least three. Jen, anything you would add to that on Enterprise and then maybe Sean ought to say a word or two about Ed.

Sure. I think from an Enterprise Division Jeff, one of the – Paul mentioned the expansion as clients stay with us and they expand and that makes sense and it came definitely to play in this quarter, and that typically a client will hire us to do a particular large scale behavior change. And as they complete that, start to see some results, they have the opportunity to work with our implementation specialists, which is very unique in the industry, in the way that we provide them to our clients. They work with our implementation specialists to uncover either additional populations to go after the same job to be done or they work at, they see other opportunities that they could utilize what was in their past, and so we are seeing significant expansion and we did as Paul mentioned, have an increase in new logo. In addition, I think our team, our Franklin Covey team, all individual contributors are firing on all cylinders. As Paul mentioned, we have a significant opportunity with those that are in ramp and we are seeing newer client partners find success quicker, our sales enablement. So I would also attribute a lot to our people, but also our value proposition of all that’s in the All Access Pass and how that leads to expansion.

Great! That’s very helpful.

Yes, hi Jeff. This is Sean.

Hey Sean!

Yeah. Hi! Should I – you want me to share a little bit about what’s going on in Ed?

That would be great.

Yeah, so just to follow up with what Paul and Jen shared, similar in education. Retention is stronger than we supposed and not only the number of schools that we’re retaining, but also the dollars per retained score, the average amount is increasing. I think a lot of this is because the market is back to normal. I think people are making decisions again. There’s a lot of pent-up demand and people have been kind of waiting on the sidelines and see how things are going to turn out, but because everyone feels like things are going to be largely back to normal come fall decisions are being made. So we have got a lot of new schools coming on, a lot higher than last year, new districts. If you recall, a few sessions ago we talked about Leader in Me 4.0 and how it’s more district friendly, but we’re seeing the results of that now and we’re bringing on some really sizable districts. Many of them all over the country that may be a few years ago we weren’t prepared to do and those are coming in starting in the third quarter, so that’s helping us quite a bit as well. So between retention new schools and new districts that we’re getting to, I think that’s what’s caused the increase in the third quarter.

And is Strive something that will be applied to the Education Division and not just Enterprise, just curious.

Yeah. [Cross Talk] Ultimately, I think it’s going to start more on the Enterprise side, but it we’ll start. I think all the innovations there, we will be able to be fully utilized at some point in education as well.

Okay. This is Paul. I’ll just say one of the great things with Strive is also the great people that are adding to our team and we’re grateful for that and there’s some very, very strong technology oriented people and great people all the way through, so.

Great! I look forward to seeing them on that soon. Then my other question centers around kind of your high level growth outlook. I think in the past you’ve articulated pretty clearly that you view yourself as kind of an 8% perpetual growth business, at least for the foreseeable future where subscription sales and add-on sales in the high teens to low 20% growth rate, and as we get to critical mass, it seems like that growth rate is somewhat conservative. You add a technology platform of Strive that addresses a larger population. What’s your outlook or what’s your view on growth acceleration from that 8% level going forward?

You know I think you’ve identified the factors that would argue for a higher growth rate in the future. I think the combination, you know in the past we knew that the growth of subscription was being offset partially by the decline in the legacy business. Now that that has largely flattened out, even the same growth we’ve been already achieving would mean that it was less drag you’d be a bit higher. So I think we’re thinking going forward that we can move into that low, I mean call it 10% anyway that we can grow 10% or so, we still have some conversion in our international operations that will create some – you know add more in deferred revenue. But I think it’s natural that with the growth rate of our subscription the things you mentioned. It will tend to edge up a bit going forward.

Great! Thanks for the time and congratulations on a really strong quarter.

Thanks so much, Jeff.

And your next question comes from Marco Rodriguez with Stonegate Capital. Your line is open.

Good afternoon, everybody. Thanks for taking my questions.

Hi Marco! Thank you.

Once again, congratulations to everybody with all the promotions and the movements, all very well deserved. I had a couple of quick follow-ups here. Just coming back on the Strive acquisition, the integration aspects, maybe if you can talk a little bit about that as far as the complexity levels and when you expect to have that fully integrated.

Paul, would you?

You want me to talk about that, Bob? Sure.

Yeah, it would be great.

Hi Marco! So Bob mentioned this team, the team that came with Strive, they came with – they were the inventors of it. This is an amazing team. In fact, it would be fun to do a demo and have you have a chance to meet some of the key people on that team. So Strive for us will power kind of three use cases if you want to think of them this way. One is when a client has a job done, say developing first level leaders and they want to take them through our six critical practices content. We’ll do that now on this Strive platform which will do all the things I’ve talked about a minute ago and I was explaining to Andrew how Strive will benefit the client. So the first thing we’re doing right now is we’re making all of our content Striveable if you will. So we’ve been getting it ready, so that the assessments all tied together and everything’s on that platform. We expect that work to largely be done and be ready to go in January. The second use case for them, so that’s when Franklin Covey, when our people are delivering services and we’re guiding a client through that. They’ve hired us not only for our content, but they want our expertise in delivering the training and doing the coaching. The second use case that will follow that first use case is equipping our client facilitators to implement our content like they can today, but benefiting from this Strive platform as well. So it’s another reason why you want to have the All Access Pass, because even if you’re not purchasing subscription services from us, you’ll get the benefit of an All Access Pass holder from the technology that’s there inside…

Understood, and then just kind of confirming here, you know obviously you brought up the integration cost that will be there for Strive. I’m just trying to understand if those costs will be stripped out of your adjusted EBITDA and then obviously your guidance or is it inclusive?

They are included, Marco.

Got it, okay. And then a last quick question for me, just kind of a higher level. It sounds like obviously confidence levels are rising, performance is very good here. Maybe if you can talk a little bit about looking out in the next 12 months, what do you think are the greatest opportunities for you to achieve and accelerate growth? And then at the same time, what is the greatest risk that you see out there that you might need to manage?

I could start and then have everybody else join in. The big opportunity we’ve seen, I mean people have been a part. They are now coming back together whether that’s office or they are in their new way of working, and there is a lot to most organizations have to do to get – there is a lot to do, and particularly in building their teams and building their leaders, etc. It’s more difficult for them during this period of time, and so I think the big opportunity is as organizations take on big new opportunities of their own for execution, prices that we’re trying to build leaders and really get all their teams together, they tend to look for things that where they – we play where there’s collective behavioral changes needed among leaders, building trust in the new environment and new work environment, unconscious bias overcoming that, and all these different ways of working I think is one big opportunity as a category that has lots of dimensions. I think that’s a big thing. Also you’re trying to make a break, an operational breakthrough in a new world. We’ve always done well coming out of a period of disruption in execution and other things and people say, ‘Gosh, I really want to pick something narrow and achieve it big, the big opportunity.’ So on opportunity side, I’d say those, Jen or Paul what else would you add to that.

Bob, I’ll speak to that. I think Bob really spoke to where we have the biggest opportunity with clients as they think about place and location and as well as the space, the behavior change and the things that they need for their people. The other one that’s been mentioned and Steve mentioned it and we talked about that is, I think we have a great opportunity in terms of our thought leadership and our market and our positioning, further strengthened by our work of integration of Strive, but many, many opportunities for – especially as we look for new logos to soften the beaches and have a new and distinctive message around who we are and what we do and how we can help you with those operational breakthroughs in moving a metric or obtaining collective behavior change. So I’m excited both about what client opportunity is, but also what we have to go after that from a marketing standpoint.

Right, Jen. I think on the challenge side, let me ask Paul were you going to add anything to the opportunity side?

No Bob, go ahead.

I’ll just add Bob on the opportunity side. [Cross Talk] Sorry…

Thank you, Sean.

Yeah, sure. Yeah. I think the opportunity in Education is huge right now, because Social Emotional Learning, SEL is more popular than ever because of all the mental wellness issues that have come up during COVID, mental health for students and teachers have become big issue. We addressed that so well and later in May. Combined with the stimulus money, the $200 billion on top of the $50 billion the federal government normally spends, this $200 billion will be in the marketplace for two and a half years. So it’s a great opportunity and runway for new clients to join us. So we think there’s a real bright future for education because of these trends.

Great! And then Marco, on your question, was that helpful on the one side, on the opportunity side?

Yeah, that was great.

Great! I think on the challenge right now, I mean you can worry about a lot of things, but the thing we are spending most of our time worrying about is how do we as an organization take advantage of that opportunity in a funny way, because everybody, every organization in the world has those challenges that we just talked about. We’ve got great distribution, great content, etc., but how can we scale it, both in terms of delivering bigger and bigger [inaudible] we’ve talked about that with Strive, but also how do we get the word out and how do we make sure that every person who is in that position can only think, Gosh, if I need behavioral changes of scale or I need to accomplish something that requires collective action, how do we make it more automatic for them, not just our salespeople to call them and then let them know, but how do we actually help people understand that actually we got this capability at a bigger scale and that’s part of what we’re investing it in this fourth quarter in some new market. I think it’s really getting out there and taking advantage of what is really huge opportunity is – you know again we’ve got the scale and we’ve got the capabilities, but I think we need to – we’re trying to figure how to scale it more quickly.

Understood, I appreciate the time. Guys, that’s all I have. Thanks.

Thanks so much, Marco.

And that concludes our question-and-answer session. I’ll turn the call back over to Bob Whitman for final remarks.

Alright, well again, we thank each of you for your great support, guidance and advice. We hope to continue to receive that and we really hope you have, all have a great force and we look forward to doing a good job here in the fourth quarter and ending up with a good year. So, thank you so much to everyone.

Thank you ladies and gentlemen. This concludes today’s conference call. Thank you for participating and you may now disconnect.