Similarweb Ltd. (SMWB) Q2 2021 Earnings Report, Transcript and Summary

00:06 Greetings, welcome to Similarweb Second quarter fiscal twenty twenty one Earnings Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. [Operator Instructions] Please note that today's conference is being recorded. 00:26 With us today are Or Offer, Co-founder and CEO and Jason Schwartz CFO. At this time, I'll turn the conference over to Annie Rosenberg with Investor Relations. Annie, you may now begin.

00:39 Thank you, operator. During this call, we will make forward looking statements related to our business, including statements related to the expected performance of our business, future financial results strategy, the potential impact of the Covid-nineteen pandemic and associated global economic uncertainty, long-term growth and overall future prospects. 01:00 These statements are subject to known and unknown risks, uncertainties and assumptions that could cause actual results to differ materially from those projected or implied during the call. Actual results and the timing of certain events may differ materially from the results or timing predicted or implied by such forward looking statements. And reported results should not be considered as an indication of future performance. 01:25 Please review our filings with the Sec, including our final prospectus and the section entitled Risk Factors therein filed with the Sec on May twelve, twenty twenty one for a discussion of the factors that could cause our results to differ. Also note that the forward looking statements on this call are based on information available as of today's date. We disclaim any obligation to update any forward statements except as required by law. As a reminder, certain financial measures we use in this presentation and on our call today are expressed on a non Gaap basis. We use these non Gaap financial measures internally to facilitate analysis of our financial and business trends. And for internal planning and forecasting purposes. We believe these non Gaap financial measures when taken collectively may be helpful to investors because they provide consistency and comparability with past financial performance by excluding certain items that may not be indicative of our business, results of operations or outlook. 02:27 However, non Gaap financial measures have limitation as an analytical tool and are presented for supplemental informational purposes only. They should not be considered in isolation from or as a substitute for financial information prepared in accordance with Gaap. A reconciliation between these Gaap and non Gaap financial measures is included at the conclusion of our Earnings press release, which can be found on our Investor Relations website at ir. Similarweb.Com. 02:56 With that, I will turn the call over to Or Offer, CEO of Similarweb.

03:03 Thank you, Annie. And thank you all for joining us here today for our Q2 earnings call, which is also our first as a public company. It is real privilege to be here with all of you on the call today. Our recent Ipo was exciting milestones for our employees. Customers, investors and partners, and I want to thank them for their confidence in us over the years. 03:29 I also like to welcome our new investors to the Similarweb family. During today's call, Jason, our CFO and I will provide details of our Q2 results as well as provide Q3 and full year guidance for twenty twenty one. 03:46 I will start today by covering highlights of our financial performance. Q2 twenty twenty one was the record quarter for us. And I'm pleased to report that our revenue increased forty nine percent year over year to thirty two point five million dollars. We are also very happy that we were able to accelerate our growth versus Q2 twenty twenty continuing our trend of accelerating growth. We also took advantage of a strong demand for our solution as companies across the globe focus on digital transformation. In Q2 we also improved our gross margin by more than two hundred fifty basis points year over year to seventy eight point five percent highlighting the scalability of our platform. Our free cash flow was negative three point three million dollars reflecting the strong fundamentals of our business even as we expanded our operations. 04:47 I want to expand further on those results also touch on a few key trends that we see as existing for our business, but first, since many of you are new to Similarweb I wanted to spend a few minutes talking about our business and market opportunity. And how we believe our offering are disrupting a traditional market and helping businesses compete and win in the digital world. 05:15 Similarweb was born out of my own personal pain. I was trying to do some market research for my offline business many years ago. But no matter what I search for, I couldn't find anyone with the insight I needed. I saw market opportunity and fourteen years later Similarweb is a leader in the market intelligence for the digital world. Today, our customers are some of largest and best brands, leaders like Walmart, Google, Publicis, Merck, DHL, and CNN and many more. A lot has changed since we wrote our first lines of code, digital has become a treasured way to communicate, transact and deliver product and services. It is an important growth driver and strategic focus for most businesses today. At the same time, it's made every market much much more competitive. In this environment businesses have no visibility into the online activity of the customer, prospects, partners and competition. In reality, they are flying blind, Similarweb cuts through the lack of visibility delivering a comprehensive view of the digital world to our customers, providing them with market data and insights to help them win in the digital world. The data and more importantly, the actionable insights that we provide and empowers our customer to be more competitive in the markets. We call this digital intelligence. 06:46 Digital intelligence is embedded in critical businesses process and give organizations the means to understand and gain insights from all relevant digital activity. It creates a powerful competitive advantage. It empower companies to make better businesses decisions, increase their confidence and help them win their market. Sometimes it can mean the difference between business success and failure. 07:14 To paint a picture of how digital intelligence can make this kind of impact I want to share a conversation we recently had with one of our customers. The head of digital marketing at Stay Sure, one of the top travel insurance company in the UK. When covid, their entire business was at risk of failure, Similarweb helped them to adapt to the new reality. With Similarweb they were able to quickly identify which market recovered the fastest from initial lockdown and focused on those opportunities. 07:47 They also used Similarweb to identify new market segments, for example, younger travelers looking to ensure against covid-nineteen risk. They were able to create new products designed for this emerging segment and use Similarweb insight to build the strategy to reach the new audience according to the company and I quote “Similarweb kept us in business”. When times are challenging, it's all about understanding what the competition is doing, where we fit in the market and what's going on in the market overall. 08:20 It's not [Indiscernible] that in Q2 we completed an upsell deal with Stay Sure increasing the ARR value of the contract by over [thirteen] (ph) percent. This example isn’t unique. Now more than ever companies need visibility into what’s happening in the digital ecosystem if they want to survive and win. 08:41 Digital transformation is accelerating, but all that investment cannot be optimized without comprehensive, accurate and timely market data that integrate into the corporate workflows. This make digital intelligence mission critical. We believe this massive opportunity and we estimate that our total addressable market today is over thirty four billion dollar. 09:09 Delivering this kind of impactful digital intelligence isn’t an easy task to do. It is extremely difficult to gather massive quantities of digital signals across the internet, each signal providing only small perspective what's going on the digital world. And it's even how they want to use those signals to build the model that are designed to measure and predict how the digital will behave. This is what we do. Just think every day, we need to estimate traffic for tens of millions of websites and [Indiscernible] in over one hundred and ninety countries and in over two hundred industries, and we need to do it really well because we know that leading companies and investors around the world will make critical business decision based on the insights we provide in our platform. 10:04 We have been working on solving this problem and creating this technology for over ten years. Over time, we invest significant resource and fund our data assets and acquisition and building a very strong competitive moats around our technology. To achieve that, we've built a unique R&D organization that operates an innovative, fast paced culture. Every month, this team deliver hundreds of innovative data and feature enhancement that improve our customer retention and increase average customer spend. 10:39 We have continued to expand this team, which now includes nearly two hundred fifty top notch developer, PhD, Data scientist and Bit Data engineers and we’re very proud of their work. 10:51 We also build a very efficient sales and marketing organization to approach and [attract](ph) this very large market opportunity. This start by attracting and engaging prospects with our widely used free tools on our website and through a popular browser extension, we provide free access to a broad range of basic capabilities as well as opportunity to explore our paid offering. 11:17 The cost effective leads from this [premium inbound] (ph) motion are efficiently converted to pipeline opportunities for our sales team to pursue. We complement this with an outbound sales motion focused on developing new opportunities with larger target accounts. 11:35 After successfully land a new customer, we also have a team of client success, go help our customers realize more value from our platform resulting in more strategic relationship and expanding revenues, This land and expand motion is working very successfully for us. 11:52 I want to turn now and discuss our Q2 performance. I would like to mention a couple of highlights and how they illustrate several of our business strategies, specifically around our land and expand sales motion, creating of new channels of indirect growth and the introduction of new products and datasets. 12:14 Let's start with our land and expand. Over the last twelve months, we accelerate new logo acquisition landing over six hundred new customers and crossing the three thousand customers logo threshold in Q2. We are building on this strong new logo acquisition by refining our motion around customer retention and growth. As an example of this, in Q2 we completed one of our largest deals in Similarweb our history with the major e-commerce company. This customer began [Indiscernible] with us in twenty sixteen starting with one use case and around fifty K in annual ARR. Today, they use Similarweb across twenty five teams globally with around fifteen hundred users, representing over three point five million dollars in ARR. Our Q2 upsell was seven figures ARR upsell with a multi-year commitment included the addition of hundreds of new users as well as an upsell of premium product feature and extended dataset. 13:20 It's also highlighting our land and expand motion in operation. Although we started small and over time we're able to expand additional user - use case department and geographies within the customer. 13:34 This land and expand motion is driving significant growth among our largest and most strategic customer segment. Those companies where we are generating more than one hundred K in ARR. We grew the number of those accounts by fifty two percent year over year. And nearly sixty percent of this growth came from existing customer, their ARR expanded to more than one hundred K. Although all our ability to retain customer and expand ARR is reflected in the highest level of NRR that we have ever recorded NRR strongly improved from one hundred and one percent in the end of twenty twenty to one hundred and six at the end Q2. In the critical customer segment of accounts with over one hundred K in ARR, we improved NRR to one hundred and eighteen percent up from one hundred and thirteen percent at the close of twenty twenty. 14:29 Beyond our direct sales motion, we continue to develop indirect sources of demand. First we recently announced the availability of Similarweb digital insight on the AWS data exchange. With the Aws data exchange, companies ranging from CPGs to hedge funds can enrich the big data analysis with digital marketing intelligence including website traffic, keywords, and digital transaction. While this did not have a material contribution to Q2 results, I believe that this partnership will broaden our customer reach and further help customer integrate Similarweb into their workflow. And in Q2, we also introduced an affiliate marketing program and partner referral program, launching two new indirect channels [for lead] (ph) opportunity creation. Also, in Q2, we launched a new solution, our shopper intelligence, which is targeted at the rapidly growing e commerce segment. Shopper intelligence analyze consumer shopping behavior across desktop and mobile and provide a comprehensive solution for understanding the digital customer journey and what consumers are buying online. Our goal is that shopper intelligence would analyze and deliver insight about digital consumer behavior across both ecommerce marketplaces and first party shopping websites. 15:58 We are off to a strong start with this new solution. We have already closed new businesses in a diverse set of industries. Not just in primary CPG audience but also in retail, pharma, technology and private equity. 16:14 I'm looking forward to giving you more details on those wins in the future. We believe that Shopper intelligence is innovative product with feature that are unique in the market and I'm super excited about it and I think we have a huge opportunity in front of us with this new offering. 16:34 In Q2, we also made significant addition to the scope of data and insights available through Similarweb platform. We completed the acquisition of the assets of SimilarTech, which we believe is one of the best provider of technographic data in the market. The acquisition enable us to more completely integrate SimilarTech’s data into our solution and opportunity to leverage their data to build some exciting new feature as well. 17:02 Separately, we recently announced a significant advancement in our capabilities in our keyword generator, which enables sales professional to find and explore keywords relevant to expanding their business. The keyword generator now include support from Youtube, the world's second largest search engine as well as Amazon where sixty percent of the product searches currently originate. Those enhancements expand our coverage by over eight hundred million keywords, extended our breadth of coverage and keyword volume accuracy. 17:37 Beyond these efforts, we continue to invest in our organizational growth and development. We continued to scale our organization to support our strong growth. Employee headcount in Q2 grow nearly sixty percent year over year. We continue our international expansion, opening up a new direct sales presence and office in Germany. Recently we also announced a new office in Reston, Virginia where we will focus on hiring sales and marketing [folks] (ph) and where we expect we will be able to tap into strong local talent in the areas of digital measurements and market research. 18:18 Finally, I’m very excited to announce that last week we closed on a new headquarter facility in the Tel Aviv area. This new building will accommodate our rapid growth, and we will be able to fully design this space to meet our needs for our growing team. Our new Similarweb headquarter is located in the [center of] (ph) Tel Aviv [metropolis] (ph) and I expect that when completed it will be significant attraction that will enable us to continue to recruit top talent here in Israel. 18:51 Finally, as we said during the IPO, we will leverage our momentum and continue to pursue both organic and inorganic growth strategies. We will invest in our sales and marketing efforts to accelerate customer acquisition because of the high ROI we get on those investments. And the big market opportunity we see. We will take advantage of our strong financial position to opportunistically target and acquire companies in order to improve and expand our data use case and addressable market. We are operating in a fragmented market and we believe we have the opportunity to be the consolidator. 19:32 Wrapping up I'm very proud of the company we have built. We have followed our twenty twenty performance with the strong and accelerating growth in the first half of twenty twenty one. We have outstanding leadership, and our team is smart, bold, fast, talented and experienced. We have a strong balance sheet. Our solution are market leading and providing timely and comprehensive data and insight that we believe our customers cannot get anywhere else. Everyday thousands of businesses rely on Similarweb solution to make mission critical decision. We believe we are recognized as the standard of the measure of the digital world, our insight are frequently referenced publicly by CEO, major publication and respected research firms. Our platform has become a required experience for job opportunities and notable skill that user highlights on LinkedIn. We are confident in our growth strategy and we have a track record of strong operational execution. It's still early in our journey and we believe we are in a great position to capitalize and capture an increased share of a very large market. And as I like to say, we are just getting started. 20:50 With that, I would like to turn the call over to Jason Schwartz, our CFO. Jason.

Thank you, Or. I'm going to start with an overview of our financial model, and then I will review our financial results for the quarter and wrap up with our guidance for Q3 and full year twenty twenty one. 21:11 Our financial model is built on the delivery of strong and predictable revenue growth, substantially all of which is generated from Saas subscriptions. We deliver a high net dollar base retention rate or NRR and also maintain high gross margins and unit economics, that drive cash efficiency. 21:30 In Q2 we delivered record revenue of thirty two point five million dollars reflecting forty eight point five percent year over year growth. We increased our total number of customers to three thousand sixty eight up twenty four percent from two thousand four hundred and seventy nine in Q2 last year. This includes as Or mentioned, a strong increase in our one hundred thousand dollars or more ARR customers, which grew by fifty two percent from one hundred and forty five in Q2 twenty twenty to two hundred twenty in Q2 twenty twenty one. Most of these customers began initially as small customers and have expanded through our successful land and expand motion. Today, these customers comprise forty nine percent of our overall recurring revenue base Our revenue on customer base is highly diversified and no single customer amounts to more than five percent of revenue. 22:28 In discussing the remainder of the income statement, please note that unless otherwise stated, all references to our expenses and operating results are on a non Gaap basis and are reconciled to the Gaap results in the earnings press release that was issued just before this call. 22:45 Our gross profit totaled twenty five point six million dollars in the quarter, representing a gross margin of seventy eight point six percent versus seventy six percent in Q2 twenty twenty. This margin improvement reflects the significant operating leverage we've been able to realize in our fixed Saas infrastructure and data costs. 23:06 Operating expenses grew to thirty six point three million dollars in Q2 up from nineteen point one million dollars in Q2 twenty twenty largely reflecting the investment in personnel across the business from product and R and D, sales and marketing and our G and A team to support our business growth. We see a large tam an opportunity ahead of us and we'll continue to invest in personnel and initiatives that help us capture more market share. The specific components of our operating expenses were, Research and development, eight point three million dollars versus four point seven million dollars in Q2 twenty twenty. This excludes six hundred and ninety six thousand dollars of retention payments relating to the acquisition of SimilarTech during the quarter. We anticipate an additional three hundred and fifty thousand dollars in Q3. 23:59 Sales and marketing twenty one point four million dollars versus eleven point eight million dollars in Q2 twenty twenty, general and administrative six point six million dollars versus two point six million dollars in Q2 twenty twenty. This excludes one point two million dollars of non recurring expenses related to our initial public offering. 24:21 As a result, our non Gaap operating loss in the quarter totaled ten point eight million dollars increasing from two point five million dollars in Q2 twenty twenty. Free cash flow for the quarter was negative three point three million dollars compared to one point five million dollars in Q2 twenty twenty. 24:43 In May, we successfully completed our initial public offering of our ordinary shares, raising net proceeds of one hundred and fifty point seven million dollars after deducting underwriting fees and commissions and related offering costs. 24:58 During the quarter, we also repaid all outstanding amounts under our credit facility such that as of the end of the quarter, we have no outstanding debt. As a result, we have a strong cash position that totaled one hundred and seventy seven million dollars of unrestricted cash balances as of June thirty twenty twenty one. We have additional capacity available to us under our seventy five million dollars credit facility with Silicon Valley Bank. As such, we believe that we have sufficient liquidity to successfully execute our business growth plans. 25:35 As Or mentioned, last week, we signed an office lease agreement for our new Israel headquarters. We anticipate investing eight dollars to ten million dollars of leasehold improvements over the next four quarters in advance of our anticipated moving date in Q2 twenty twenty two, which will be amortized over the ten year term of the lease. 25:57 We are introducing guidance for both Q3 and the full year twenty twenty one. For Q3 twenty twenty one, revenue is expected to be in the range of thirty two point eight million dollars to thirty three point two million dollars. Non Gaap operating loss is expected to be in the range of fourteen point five dollars to fourteen point nine million dollars. Full year twenty twenty one revenue is expected to be in the range of one hundred and twenty nine million dollars to one and thirty million dollars. Non Gaap operating loss for the full year twenty twenty one is expected to be in the range of forty nine million dollars to fifty million dollars. I'll now hand the call back over to Or for his closing remarks.

26:42 Thank you, Jason. I would like to close by thanking my leadership team and our employees around the world for working hard to deliver a very successful first half of the year. Our IPO was a milestone for us as we continue to grow, and I’m pleased to welcome our many new investors to the Similarweb family. With that operator, please open the call up for questions. Thank you.

27:12 Thank you [Operator Instructions]. And our first question is from the line of Sterling Auty with Jpmorgan. Please proceed with your question.

27:43 Yes, thanks. Hi guys. So wanted to start with the question around the Aws marketplace partnership and deal. Can you help us understand does this just make it easier for customers to access the data and monetize? Does just change where they're getting the data from or does it actually add incremental reach to new customers that perhaps you weren't getting to before?

Hi Sterling. It's Or. I will try to answer this question. So I think the quick answer sellers is yes to all of the above. It will increase us the way to approach to many more customers than before that are operate on the Aws platform and buying data on the data marketplace. So we do expect to get more customers. It will give a easy way for them not only to access the data, but another layer of seller to sell them. So they need to get the Api, API key. It's more easy to get and access our data and also charge [Indiscernible] trying the data, because the data is already there and if they have AWS account, it's much more easy for them to buy, Use, try it and also charge because they’re already connect to the Amazon invoice system. And also, Amazon is putting rather incentivized on - for their customers and give them free credits to try many data sets on the data marketplace. So we also going to leverage this momentum of Amazon themselves pushing their customer to try and buy data assets.

29:33 Great. And then one follow-up, with the improvement in the net dollar retention, can you talk about the number of different ways that you can expand more users, more data more geographies, which one of those really stood out the most in the quarter in terms of driving that net dollar retention?

29:54 So I don't have the exact answer but I tell you what I feel that is driving really great expansion. One is the cross selling of offering. And I talk a little bit about shopper intelligence. So, we saw great success there, people buying one more solution for us. So I think buy more solution is a great driver. But I also saw great deal of people buying more users or other add-ons or integrating Apis. So, I think it's all across. But my feeling that is strong now is this quarter was the most solution we able to sell in introduced to our customer.

30:38 Great. Thanks, guys and welcome to the public markets.

30:43 Thank you, Sterling.

30:47 The next question from the line of Drew Foster with Citigroup. Please proceed with your question.

30:53 Hey guys. Thanks for taking the question. Jason, for the past six quarters or so, your top line has been growing sort of directionally in line with your sales and marketing spend this quarter, it was up another thirty points sequentially relative to Q1. So you’re clearly accelerating that. 31:08 To the extent that sales and marketing is a leading indicator for your top line like at a high level, how should we think about the pace and magnitude of investments within that envelope over the next six quarters. And then if you could just remind us to the breakdown of how much of that incremental spend there is marketing and advertising, where you might get a quicker return on those dollars and how much is related to adding incremental salespeople and sales infrastructure or the return on those investments is a bit more protracted?

31:37 Hey Drew. Thanks for the question. So, what we see right now is a huge Tam and opportunity ahead of us. And as a result of that, we're continuing to invest to capture a larger share of that market that we see. And so, we have accelerated hiring, I think you may have seen that in the press release that headcount has grown across the business. But our approach is really to invest in a responsible way balancing that growth and efficiency. And so that's what we're going to continue to do and we do think that that's an indication of further growth down the road. As far as the split, we don't break down the split between marketing dollars versus headcount dollars, but what we do say is about sixty percent of our marketing and sales spend goes to new customer acquisition and about forty percent of it is spent on customer retention and expansion.

32:53 Really helpful. Thanks. And then you had strong gross margin improvement. I think you called it out at the top of your press release. So could you just maybe unpack what's driving that and where you think you could drive those to over time? Thanks guys.

33:06 Yes. Sure. A lot of our cost of sales is comprised of fixed costs and in the infrastructure, the typical kinds of stuff that you have. We have hosting and support, we actually host at Aws as well as all of the investment that we make both internal cost and external cost in our data assets. And so which is really a fixed cost for us because it's the same amount of data that we need whether we're running - providing service to fifty five hundred or five thousand customers. So there's a natural leverage that we get on those fixed costs, and that's the improvement that you see not only in this quarter but over the trend over time over the last two, three years. We think that we’re comfortable with the guidance that we've given; we're staying in the same levels for the near term and then potentially going forward as we think about guidance going forward, we'll of course update you.

34:16 Thanks a lot.

34:18 Thank you.

34:20 The next question is from the line of Bhavan Suri with William Blair. Please proceed with your questions.

34:26 Hey guys, congrats and welcome to being a public company. Nice job. I guess I just wanted to touch quickly first on the new customer strength. I'd love to sort of understand what's driving momentum that obviously increased sales and marketing, you've got partners. But I guess as you look at that, are these customers sort of replace another vendor or is this web intelligence programs for the first time?

34:55 So, a good question. I think that the majority of the deal that we are at it's basically it's only us. We are not replacing. It's mostly a greenfield opportunity.

35:11 Got you. Got you. And then you re launched a platform in nineteen with sort of these five key use cases. Have you seen any change in how customers are adopting solutions, are they changing where they start and are they building different sort of data strategies once they've implemented a couple of solutions. How should we think about that progress the customer and sort of their strategy from when they adopt to when they change? Thank you.

35:36 It's a good question. I do see that the more we develop our offering and bringing new solution into the market, we kind of unlock new strategies for our customers, once we kind of introduce our solution better and I saw it also in our Cpg customers, now that we introduced Shopper solution to them and they get in this all new data and then they understand they can drive new strategy and one example we’re also on investors vertical when we come with the more sharp offering and then it's kind of giving them a whole perspective about how to think and develop strategy around data and insights like market data and insights going forward. So I do see that, I do see that it will come and a lot of the things we present are new and innovative even to the customers. And they understand the power that digital intelligence have and how they can use it to drive more strategic decision across the business.

36:41 Gotcha. Thanks for the color and nice job guys. Thanks for taking my questions.

36:50 Next question comes from the line of Brent Thill with Jefferies. Please proceed with your questions.

36:55 Hi, thank you. This is [John Dan] (ph) for Brent Thill. I had two questions. One of the five major solutions you have any particular strength to highlight among the five and maybe if you just could shed some light on the relative contribution. And then second, it’s probably for Jason. Just want to see if any comments on the linearity during the quarter, the trends by month, any particular variations to note including quarter date? Thanks very much.

37:27 So I will start answering the solution and then Jason can talk about the trend. So, all of the solution are growing very nicely. And we're very happy with the overall growth. And we saw a great success with the new tool offering for investors and the shoppers, so Cpgs are accelerating nicely. 37:51 But I think still the majority of our business is for our core solution that we start through our research solution and our marketing solution. That historically a lot of our customers used to buy together. And all of them are growing very nicely, and we're putting a lot of efforts to develop them and improve the offering. And Jason you want to answer the trend.

38:17 Yeah, sure. Within the quarter, there's some variability from quarter to quarter. But in general, because we run on an Arr model, we've got good visibility and predictability into the revenue trends as we start the quarter.

Great. Maybe just a little bit on that. I mean, were there anything that you noticed in terms of customer activity as opposed to the revenue trend? Ups and down, variation and that will be it for me. Thank you.

38:56 Not, not material. I think we see a lot of customer activity and a lot of customer demand throughout the quarter. And we're pleased with that continued motion.

39:13 Thanks again.

39:18 The next question is from the line of Raimo Lenschow with Barclays. Please proceed with your question.

39:24 Hi. This is Sheldon on for Raimo. Congrats on the Ipo and thanks for taking my question. Interested in the enhancements to the keyword generator tool. Can you help me understand how differentiated the new capabilities are compared to competitor solutions and the existing Google suite capabilities. And additionally on Youtube Seo, it seems like we're still in the early innings there. Can you provide any color on the opportunity? Thank you.

39:57 Yeah. So, thank you for question. And I will answer that. And so, I think that this new enhancement to give to our keyword generator is our show that we can bring very unique data asset like no other competitor in the market with our unique approach to provide the insights. And we know that today search is involving and Youtube is already their second biggest search engine out there and Amazon is the biggest search engine for e commerce, for shopping activity. And we recognize that our customers want to also understand the trend there and to develop their own sales strategies. So we realize that we can be innovative and give very high quality and results around our keyword generator and we're very happy with the data and the accuracy we put down, and really big coverage with almost eight hundred million keyword for you to check there. And I do think this motion will bring a lot of new ideas and new strategies to our customer to go after and acquire more traffic.

41:14 Great. Thank you.

41:19 Our next question is from the line of Jason Helfstein with Oppenheimer. Please proceed your questions.

41:25 Hey guys. This is Patrick Josephs on for Jason. Thank you for taking our questions and congrats on a strong start out of the gate. I just want to dive a little bit deeper into the record consolidated and ARR metrics. Specifically were there deals that leads into the second quarter that could not be closed during the pandemic? Or is it just broadly a shift in client behavior which is just driving more spend at Similarweb. Also, I know that you guys are guiding to NRR metrics, but should we expect NRR greater of one hundred five percent going forward, on a consolidated basis?

42:02 So I will try to answer it from my side, and Jason can add his opinion. Our NRR growth over the past many quarters is it's a lot of hard work we did historically and now we start to collecting the fruits; a lot of improvement in our data, in our platform, in our sales approach, in pricing and packaging, our relationship build with our customer; introducing of new offering and adding more Roi and value to our customers. And this is why we see a great result of NRR; keep growing for the many quarters. And this is why they also spend more money with us. And Jason you want add to maybe from your side?

I think Or I agree with you on that. This is the result of a lot of hard work and of course all customer segments that we saw strengthening both on retention and upsell, which is what's driving that NRR metric.

43:11 Okay, great. Thanks. And just a follow-up question related to the app measurement product. Could you give us an update on the development of the app measurement product and whether there have been any delays given the ios update? Thanks.

43:29 Ad or app?

43:33 Sorry, the app measurement product.

43:36 Okay, so yes. So this deal we decide to double down on our app offering and provide more market insight around the app ecosystem. And a lot of great development there, and they’re going to introduce a lot of development to the Android data in the coming months, and hopefully also introduce a lot of improvement to the ios data by the end of the year. So a lot of great improvements coming in the next few quarters around this area. But we are doubling down and putting more effort to scale and reach our app offering.

44:15 Okay, great. Thanks for the questions.

44:20 Thank you. Your final question comes from Pat Walravens with Jmp Group. Please proceed your question.

44:28 Great. Thank you. And congratulations you guys. So my first one is, if you look at this, it's a great win expansion with the e commerce company, the three point five million dollars in Arr. So my first question is how much more room is there at a company like that? At three point five million dollars are you done or can it keep getting bigger?

44:50 This is a great question because I just have a great talk with my team. I told them that the target that this customer will be our first ten million dollar customer. This is what I hope and think. So there is much room to go.

45:08 Okay great. That's what I was hoping. And then how many other ones are there where, and Jason I don’t know if you disclose this, but have you told us how many you have that are north of a one million in Arr and if not that just what does the pipeline look like for other customers that can be north of one million dollars in Arr?

45:26 So we are not reporting, I’ll start, but to answer and then Jason can give, we’re not reporting right now, how many - how much seven figures customers we have. But we do see a [Indiscernible] to increase this sector of customers. And as I talk and presenting in the roadshow we have a big part of the fortune five hundred already as our customer. And I think most of them need to pay seven figures down the road, and hopefully, we will get though. Jason, you want to add on that? Yeah.

46:07 As Or said, today, our focus and the numbers that we talk about are that strategic customer group that are customers who spend more than one hundred thousand dollars with us. But we've seen, we saw that fifty two percent growth year over year this quarter in that cohort of customers. Today, that makes up about forty nine percent of our Arr. 46:32 We see over time that the same motion where we're seeing customers starting as smaller customers and growing into and expanding from in a single solution or as Or talked about the multi-solutions getting up to multi hundred thousand dollars and driving that lifetime value, we think over time, we can get number of customers to be those seven digit accounts.

47:03 Great. And then last one for me. Obviously, you're not guiding to the out years, but just Jason, how should we think about sort of what you aspire to in terms of longer term revenue growth so what's the plan that you're building internally in terms of your hiring your quotas and your products you're going to bring to market and putting all that together; how fast do you think that this company is growing over the longer term?

47:37 It's a great question pat. And like we said, we see a huge tam ahead of us. And we've also looked at the performance and how we've shown that we know how to both grow and do it in a responsible and efficient way. And so, to the extent that we can continue to do that, we will continue to invest smartly to balance that growth and efficiency. But we really will look forward to leaning in and capturing a larger share of that market that we see.

48:17 Okay. That’s it for me. Thank you.

48:22 Thank you. At this time, we've reached the end of the question and answer session. I’ll now turn the call over to management for closing remarks.

48:32 Thank you, everyone. I'm really excited to be here and answering for your question. It's our first time in call out of many to come, and we hope to continue deliver, make our investor happy. Thank you, and that's hope for amazing good year. Thank you for your question.

48:54 Bye.

48:55 Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.