SharpSpring, Inc.
Q4 2018 Earnings Call Transcript

Published: 28 Feb 2019

[Operator:]

Good afternoon. Welcome to SharpSpring’s Fourth Quarter and Full Year 2018 Earnings Conference Call. Joining us today are SharpSpring’s CEO, Rick Carlson and CFO, Brad Stanczak. Following their remarks, we will open up the call for your questions. Then before we conclude, I will provide the necessary cautions regarding the forward-looking statements made by management during this call. I would like to remind everyone that this call will be recorded and made available for replay via a link available in the Investor Relations section of the company’s website at investors.sharpspring.com. Now, I would like to turn the call over to SharpSpring’s CEO, Rick Carlson. Sir, please proceed.

[Rick Carlson:]

Welcome everyone and thank you for joining us today. After the market close, we issued a press release announcing our results for the fourth quarter and full year ended December 31, 2018. A copy of the press release is available in the Investor Relations section of our website. Looking at our results, both financially and operationally, 2018 was an excellent year for our organization. As a business, SharpSpring is growing and improving. We are continuing to attract top talent to our Gainesville home, winning awards for the quality of our platform and for our workplace culture and constantly challenging ourselves to making our processes more efficient, our strategies more effective and our customers more valuable. As a product, SharpSpring continues to get better, more powerful and more useful, all while remaining a fraction of the cost of the competition. And while our performance improvements and growth didn’t just come overnight, in a relatively brief period of time, we have successfully gone from an upstart marketing automation company to an award winning and significant player within our industry with over 1,700 agency customers and over 7,000 businesses using our platform. The fourth quarter in particular capped off as still continuing period of strong, consistent and improving performance. Financially, we grew our top line another 37%, $5.2 million, leading to our seventh straight quarter of record revenues. At the same time, we continued to take advantage of the leverage within our operating model, eclipsing 70% gross margin for the second consecutive quarter. Operationally, we secured another 379 new SharpSpring customers in Q4 marking yet another record quarter in quarterly sales for our company. What these results show is that we are continuing to win customers at an accelerating rate which is thanks to the superior value proposition of our platform and the solid lead generation and sales conversion processes we use to sell it. As long as we continue to see such strong results from our sales and marketing efforts, we plan to continue and increase our investment in these areas. 2018 was about expanding our outreach to increase our share of market. Looking at 2019, we are going to continue these efforts but we’ll also focus on ensuring that we maximize the value of all of these new customers, as well as that of our long-time agency partners. I plan to go into greater detail on all of these items as well as our outlook for 2019 in just a minute. But before I do, I am going to turn the call over to our new CFO, Brad Stanczak. As I mentioned on our previous call, Brad brings a wealth of experience to the CFO position. He has been on the job for just over 2 months now and we are already benefiting from his operational expertise and process improvements. Without a doubt, he has been a great addition to the team. And with that, I will turn it over to Brad who will walk us through the financial results for both the quarter and year. Brad?

[Brad Stanczak:]

Thank you, Rick. I appreciate the kind words and good afternoon to everyone on the call. Before I start, I would like to take a moment to say how excited I am to be part of the SharpSpring team. During my first 2 months, it has become even more apparent to me that SharpSpring is a special company with an outstanding product and very talented employees. So I would also like to publicly thank Ed Lawton for his help during my transition and for setting both me and SharpSpring up for continued success. Alright. Now, let’s turn to our financial results for the fourth quarter and full year ended December 31, 2018. Our total revenue in the fourth quarter increased 37% to $5.2 million from $3.8 million in Q4 of last year. The SharpSpring marketing automation platform grew 41% to a record $5.1 million compared to $3.6 million last year. For the full year 2018, our total revenue increased 39% to $18.7 million from $13.4 million in 2017. The SharpSpring marketing automation platform grew by 43% to a record $18.3 million compared to $12.8 million last year. Our gross margin for the fourth quarter of 2018 increased to 72% from 68% last year. In dollar terms, gross profit increased 47% to $3.7 million from $2.5 million in Q4 of last year. For the full year 2018, gross margin increased to 69% from 63% in 2017. In dollar terms, gross profit increased 52% to $12.9 million from $8.5 million in 2017. As we mentioned on previous calls, over the past few years we have invested significant resources in our hosting infrastructure and support organization to reinforce the current and future growth of our product. As we continue to layer more revenues onto the platform, we will create more and more operating leverage on our model, as evidenced by our year-over-year improvement in gross margins. Going forward, we expect our margins to decline slightly for the next couple of quarters, due to investments in several initiatives meant to derive future revenue expansion from our installed customer base. As the year progresses, the leverage we get from new revenues on the platform will return margins to current levels. Rick will provide more detail on these investment items in a moment. Turning to our operating expenses, for the fourth quarter of 2018, our operating expenses increased 44% to $6.1 million from $4.2 million in Q4 of last year. For the full year of 2018, our operating expenses increased 41% to $21.7 million from $15.4 million in 2017. The quarterly and annual increase was due primarily to investments in sales and marketing initiatives to accelerate our future growth and to a lesser extent, additional investments in our R&D organization to accelerate roadmap items. Our GAAP net loss for the fourth quarter totaled $2.3 million or $0.26 per share compared to GAAP net loss of $436,000 or $0.05 per share in Q4 2017. For the full year 2018, GAAP net loss totaled $9.5 million or $1.11 per share compared to a GAAP net loss of 4.7 million, or $0.56 cents per share in 2017. On the balance sheet, we had $9.3 million in cash at the end of the quarter compared to $11.2 million at the end of the prior quarter and $5.4 million at December 31, 2017. Looking at our non-GAAP measures, our adjusted EBITDA loss for the quarter, which we reconcile in our earnings release, totaled $1.6 million. This was fairly consistent with last quarter and is an increase from an adjusted EBITDA loss of $1.3 million in the same year ago period. For the full year 2018, our adjusted EBITDA loss totaled $6.2 million compared to $5.3 million in 2017. The higher adjusted EBITDA loss was the result of our continued investment in new sales and marketing programs, as well as our development team. We plan to further invest in sales and marketing initiatives and future revenue growth initiatives early in the year and as such, we expect our adjusted EBITDA to decline in Q1 and improve sequentially each quarter, returning to current levels in late 2019. Our core net loss for the fourth quarter, which is also reconciled in our earnings release, totaled $1.7 million or $0.19 core net loss per share compared to a core net loss of $318,000 or $0.04 core net loss per share in Q4 of last year. For the full year 2018, core net loss totaled $7 million, or $0.82 core net loss per share compared to core net loss of $3.7 million or $0.44 core net loss per share in 2017. For more details on our adjusted EBITDA, and core net income metrics, please see the reconciliation of GAAP terms included in the supplementary table of today’s earnings release. Moving to some of our other metrics, during Q4, our cost to acquire a customer was just $6,900. As a reminder, we calculate customer acquisition cost as the sum of our all-in sales and marketing costs from Q3 2018, divided by the new wins from Q4 2018. While this is a slight increase on customer acquisition costs from Q3, it is primarily due to timing differences between when sales and marketing dollars are spent and when the customers are acquired, as well as demo scheduling seasonality during the holiday season. While using the prior quarter costs provides a better estimate of our customer acquisition costs to account for the average sales and marketing cycle we experience, this measurement is still imperfect because marketing spend in one quarter impacts the deals we win in future quarters. Though we do experience fluctuations in this metric quarter-to-quarter, we are confident that we can continue to consistently acquire customers at our historically attractive all-in rates that will deliver significant lifetime value for the business in the future. Our lifetime value calculations, which are long-term and include estimates for future performance, continue to indicate that agency customers could be worth approximately $50,000 to the business on average. This long-term value reflects the benefits to the company on a discounted basis after reducing for estimated gross margin costs to support the customers on the platform. Based on these figures, our expected lifetime value to customer acquisition cost ratio continues to be compelling. This completes my financial summary. I’d now like to turn the call back over to Rick for additional insights into our operational progress in Q4 as well as our outlook for 2019. Rick?

[Rick Carlson:]

Thanks Brad. As I said in my opening remarks, the fourth quarter and 2018 as a whole signified yet another period of unparalleled performance for SharpSpring. Given the strong and consistent results we produced throughout the year, I’m not going to spend a lot of time rehashing what’s continuing to work in our formula that we’ve highlighted for the past few calls. Instead, my comments will focus on some of our highlights from the year and on our major investment initiatives in 2019 and beyond. Generally speaking, in 2019 we plan to continue pursuing growth with our successful and proven sales and marketing investment strategy to drive customer wins to new record levels throughout the year. Additionally, we are giving increased attention to our existing customer base to ensure that they are maximizing their potential on our platform with more initiatives aimed at increasing engagement and value generation. We believe that these investments and investments in these areas can over time increase the already impressive lifetime value of our agency partners. I will now talk a bit about some of those internal process improvements we are making to our sales and marketing engine. First, in our outreach, we have identified refinement opportunities within our marketing channels where we have been able to better target those agencies that we found to be our best potential customers in the long-term, based on certain characteristics. Within these channels, we have also been improving our communication process between marketing and sales to drive better conversion once we’ve been able to identify these potential customers. One area we have been able to leverage this new strategy has been through a series of prospecting events around the country. Here we invite prospect agencies to join us at events hosted in various cities and listen to some of our current agency partners explain why they chose SharpSpring. These events are only possible because of the scale and brand awareness we’ve achieved with our company over the previous years and have been well received by prospects and partners alike. Further to that and with our strong unit economics as a backdrop, we have data to support continued and higher spend levels to drive customer acquisition. I know we can be even better in our marketing channels and we are working to do so. The point is that we have built a repeatable process that has been working and we expect will continue to work well for us moving forward. Additionally, with the large installed base of customers we now have, we believe we can do a better job of servicing our agency partners, which will enable them to achieve long-term success on our platform and lead to even greater upside potential as they bring more of their customers onto the SharpSpring platform. We have come up with a number of ways to support this initiative, but the key change will be our introduction of dedicated account managers to support our agency partners. The account managers will work to both identify and mitigate risks of attrition, while increasing our share of wallet within each agency via cross-selling and up-selling of additional agency client licenses and new features. To-date, we have made 4 hires to support this function and we are expected to have about 10 in total by the end of Q2. Another major initiative is our START program, which we began in January. START stands for Sales Tactics and Recommendation Tool. Through the program, we are working in conjunction with our agency partners to help them more effectively target potential customers of their own and win new business to the SharpSpring platform. From a high level perspective what we are doing is working to create customized sell-through materials and an implementation strategy document for the agency to use for whatever specifically they are targeting. Through this program and the added support of our account managers, our agencies will increase their client count, which in turn serves the dual function of reducing our attrition and creating greater up sell opportunities and more expansion revenue. Furthermore, we feel we can drive a greater portion of agency wallet share as they’re able to more effectively pitch the SharpSpring platform to existing clients of theirs that may not be currently using our services. In addition to the investments we are making in our account management team and the tools to support them, we are investing heavily into additional functionality for our product. Many of these feature improvements will be included into the platform at no additional cost and serve to further extend our value proposition with agencies and their clients. But in addition to these, we are busy working on several additional features that will serve as additional revenue streams for SharpSpring. As many of you that have been following the company for some time know, we have steadily increased both the number of agency partners and the total number of businesses on our platform. While 2019 will be no exception to adding more new agencies, we’ve also given more attention to increasing share of wallet at each agency, which for our purposes we define as the number of agency clients we get from each agency. This is important work that we will continue, but there is also a third pillar to our revenue model that we have yet to really begin to extract value from in earnest and that is to begin to sell additional products and services into the healthy and growing base of companies that are utilizing the platform. Because marketing automation is really the core technology used by marketers to deliver results, marketing automation providers like SharpSpring are well-positioned to offer add-on services that work seamlessly with our platform and serve to increase the average revenue per core license that we receive. While we are not yet ready to discuss these additional functions and revenue streams in detail, we are busy at work developing these features and are excited about what they will mean to our business in the coming months and years. From a financial perspective, I want to be clear about how these investments in our long-term viability with be reflected in our P&L going forward. First, you will see evidence of our increased headcount related to the account manager strategy, resulting in a temporary reduction in our gross margins for the next couple of quarters. The first quarter of 2019 will be the first full quarter we have operated with new account managers on the payroll, which will be accounted for in our cost of sales. By the end of this year, we should begin to see an increase in margins as the majority of the hiring process will have been completed in early 2019 and our customers will be fully ramped with their respective account manager. Over the long-term, we expect the account managers will not be a drag on gross margin, but will serve to increase it via increased lifetime value of the agencies that they manage. Additionally, as Brad mentioned earlier, we continued to invest in Q4 consistent with our plan to continue allocating resources to our sales and marketing spend and new employees on the R&D side. We also invested in updates to our code base, focused on quality assurance, which will help improve the overall architecture of our platform, allowing us to implement new code faster in the future, as well as spend less time on bug fixes and deferred maintenance items. The broader point here is that we are going to continue increasing targeted spend and investment for the foreseeable future. And while some of these increased expenditures won’t immediately be reflected in our operations in the near term, we fully expect to see significant down the road effect in 2020 and beyond. Now a few recent highlights from the quarter, back in November, SharpSpring was selected as the Technology Company of the Year by the Greater Gainesville Area Chamber of Commerce. This award from the Greater Gainesville Chamber is both gratifying for its recognition of our business success, but also humbling as it acknowledges the positive impact we have had on our local community. SharpSpring has built a reputation in our community as the place to work and we’re proud of it. Also in November, we received a National When Work Works award from the Society of Human Resource Management for innovative and exemplary workplace practices. The SHRM, or SHRM, When Work Works Project, is a national initiative that helps employers become more successful by transforming the way they view and adopt effective and flexible workplaces. Finally, SharpSpring recently won the top rated Automation Software for 2019 award given by TrustRadius, a widely respected and user review driven software review site. This is the second consecutive year SharpSpring won this award and it’s meaningful, because it is driven entirely by user feedback. This year, in addition to SharpSpring, only HubSpot, Marketo and Oracle received this recognition. Further, each of these platforms, have been in existence for many years longer than SharpSpring and each of them are many, many times the cost of the SharpSpring platform. To be recognized in this group speaks volumes about the quality of our platform, the dedication of our team and the future prospects for our company. As a business, SharpSpring is consistently focused on creating the best quality and value products for our customers. At the same time, we have worked hard on our culture and our people. To that end, as I mentioned a few times now, SharpSpring has continued to grow substantially in the past few years. To accommodate our expanded operations, in November we moved into an entirely new facility, still in Gainesville, that nearly doubles the area we previously occupied, increasing from 14,000 square feet to 26,000 square feet. And as a company, since January 2018, we’ve grown our headcount roughly 34%. Looking ahead, we are excited to fill the extra space with additional top tier talent to continue making SharpSpring one of the top marketing automation solutions in the market. I may sound like a broken record at this point, but I will say it again, SharpSpring is in its best position to-date and we are in a great place to continue executing against our long-term growth plan. For our immediate outlook, like many SSAS companies, the first quarters typically are softest quarter, due to lower attended demos completed over the holiday season and artificially shortened January as folks return from the holidays late and a short February. That said we expect a solid quarter with year-over-year growth in new sales and overall revenue and then continued growth throughout the year. In short, we are taking the necessary steps to make sure that we are built to last and to maximize the long-term prospects for our business. We look forward to continuing our expansion of market share within the growing marketing automation industry, which will ultimately translate to more favorable returns for our shareholders. And with that, we are ready to open the call for your questions. Operator, please provide the appropriate instructions.

[Operator:]

Thank you. [Operator Instructions] And we will take our first question from Eric Martinuzzi from Lake Street Capital.

[Eric Martinuzzi:]

Congratulations on the results. Hey, Rick. Hello, Brad. Congratulations on your position as Chief Financial Officer.

[Brad Stanczak:]

Thank you very much.

[Eric Martinuzzi:]

I wanted to talk just on the revenue, you talked about kind of the seasonality that you are facing, but for you guys most of the revenue is coming off the balance sheet here. Historically you have been in that kind of $200,000 sequential growth. Is there any reason to expect that wouldn’t be the case here just kind of Q4 to Q1 or is there something more I should be considering on the marketing automation side?

[Rick Carlson:]

Got it. I think you would think that the pattern would be roughly the same, Eric.

[Eric Martinuzzi:]

Okay, alright. And then I noticed you talked and I appreciate the additional color on the account manager initiative that the path that you have started down here. Just wondering, you have got 4 hires I assume some of them have been in place for a month or two, any early returns? Did you pilot this initiative with a certain sector or segment of your customer base that gave you the impetus to kind of go at it in a much more structured manner?

[Rick Carlson:]

Well, yes, certainly we did. We have been thinking about this for quite a while and we have been having discussions with our account managers. We have had key account personnel that we feel like have had an impact in terms of keeping our key accounts happy and growing. And so we do have a lot of sort of reason for optimism that the account managers will do what we think that they will do. And in terms of the results for these recent hires, no, I mean we are really still in sort of the rollout and training phase of these particular employees. And so I would also think that the nature of account management is building relationships, getting to understand the business and that those results happen gradually over time, it’s the reason we think that this year the initiative is somewhat of a sort of a breakeven process at best and then where we really see the results on this are going into next year as the work that they do this year. We get sort of full credit for that work for all 12 months of next year. So yes, lots of reasons for optimism around the function, but still in the early days.

[Eric Martinuzzi:]

Okay. And then as far as the metrics that you are using I assume you have got some – at least some internal metrics whether it’s retention rates or dollar revenue per customer or revenue per seat that sort of thing. Are you going to be sharing any quantitative metrics with us?

[Rick Carlson:]

Around this function?

[Eric Martinuzzi:]

Yes, the account penetration, the agency penetration.

[Rick Carlson:]

No, I don’t think we will – so first off just in terms of how these account managers are comped and incentivized where they are absolutely working on sort of the net revenue attrition aspect of the business, right, fighting attrition and working on expansion through both expanded licenses at each agency and cross-selling and up-selling some of these new features I alluded to during the script, but I don’t think we will be sharing anything specific about their success other than what we share in terms of seeing the results in the top line metrics.

[Eric Martinuzzi:]

Okay. And then a comment and a question and I will wrap up here. Just congrats on the TrustRadius award, I know that’s something that it is your second year being recognized by TrustRadius. Just wondering what do you think it is – I think I know what you are going to answer, but I need to ask anyhow, what do you think it is, one or two things that is distinguishing the SharpSpring offering in what’s a still pretty relatively crowded market? If you could focus on that, I would appreciate it.

[Rick Carlson:]

Yes. Well, absolutely, I don’t think I am going to surprise you too much as you pointed out, but first for those not familiar with the TrustRadius award that we received, the thing that makes this something special is that it’s entirely user feedback oriented. And so we didn’t actually realize we were winning this award or getting this recognition until after we did so. And again very excited about it because it really speaks to how customers think about our platform. Over the last 5 years, we have been playing catch up with the other companies that won this award, HubSpot, Marketo and Eloqua. And really SharpSpring has separated themselves from the people behind us for the combination of – we now offer every major feature that’s in a marketing automation platform from landing page builders and social media management and I could go on there, but I won’t. And yet we do it at a very tiny fraction of the cost. And then I think the third pillar to that success is we have fantastic customer support. I mean, if you do any research on the company and you see what our customers say about our support, it’s right up there with the features and functionality and the price point. And so needless to say, that’s a pretty winning combination and we are pretty proud of it. And to be included with HubSpot and Marketo and Eloqua, all companies that have been doing this for 10 years longer than we have is pretty exciting for us. So yes, I think that’s the reason, that combination.

[Eric Martinuzzi:]

Good luck in the year ahead.

[Rick Carlson:]

Thanks very much. I appreciate it, Eric.

[Eric Martinuzzi:]

Thanks.

[Operator:]

[Operator Instructions] We will take our next question from Mike Malouf with Craig-Hallum Capital.

[Mike Malouf:]

Great. Thanks for taking my question. How are you doing, Rick and welcome aboard, Brad to the call.

[Brad Stanczak:]

Hey, Mike.

[Mike Malouf:]

If I could focus a little bit on these agents that you have as well, are they going to be more focused in on taking that churn number down or is it more focused in on new customers, just trying to get a sense of where you think the low hanging fruit is?

[Rick Carlson:]

Yes. Well I think that the work that is – I think it’s the same work. So, these account managers are, I think historically first, let me start by saying this. Historically what we have done at SharpSpring is put our agency partners through a 60-day on-boarding program. And at the end of 60 days, we essentially say and I don’t mean to be flip about this, but we have essentially said hey, contact us if you need us and here is our support organization. We are excited about adding this account management function because we are turning that relatively passive stance, which I remind you still leads to a lifetime value we think is somewhere near $50,000 and the SSAS metrics that you guys know and that we like to talk about. But we think there is a lot more meat on that bone in terms of increasing lifetime value with these agencies by proactively managing, helping them sell to their new clients, spotting problems earlier before they become reasons for attrition. And so I really think that the account manager’s job is to know these agencies very well, learn their businesses and help them. And in doing so, I think they are fighting both the attrition battle and the expansion opportunity battle as well. I mentioned in our opening remarks that we are also – we have got a number of new features that we think are going to be up-sell opportunities into our platform and I think the account managers will pay a key role in making sure our partners know about those features as well. So it’s kind of an all of the above answer I think and it’s really the same kind of work that drives both the lower attrition and higher expansion. So we are excited about it.

[Mike Malouf:]

Okay. And then just playing off that functionality increase that you talked about, is this going to be a release, a new release that comes out sometime maybe in the sort of late spring, early summer period or are we talking a series of upgrades throughout the year with regards to that? And then I am just trying to get a sense of the timing, because it looks like R&D was up quite a bit in the December quarter, so you must be already spending away and trying to get this into the product?

[Rick Carlson:]

Yes. We are definitely plugging away and we feel like its software development and it’s never as fast as I want it to be, I will tell you that. But we have got a pretty fantastic team of developers. I would say we would start to see those things coming online towards the end of Q2. Now, those are products or features I should say that are sort of up-sell complementary opportunities for subsets of our customers. And that we have got several of them that are coming online that are I think each going to take incremental steps towards increasing our average revenue per license, but these are incremental steps and they will be ready to begin to be marketed I would say this summer, towards the end of Q2 and that’s not like a hard release and all of a sudden a number of customers are paying quite a bit more. These are gradual adoption as our customers begin to know about these features and begin to adopt them.

[Mike Malouf:]

Got it. And then just a final question on pricing, I think if I remember right at the end of 2017 you took a fairly significant price increase. I am wondering if you did that again recently, if there is a plan for that and then just kind of an observation on where pricing fits right now for your product versus HubSpot, Marketo and maybe Eloqua?

[Rick Carlson:]

Yes, sure. So, we have not done a price increase this year. We are excited about these new products that are coming online. It’s always a – and we have not made any sort of final decisions on whether to do that, but the results that we have spoke about here for Q4 and certainly the results that we will report eventually in Q1 are not going to include any price increases. We have just not done that. We are I think excited about growing our relationship in general with our agency partners based on them adopting more licenses and gaining greater share of wallet at the agency meaning more of their customers are on the platform as well as these expansion revenue opportunities. I am not saying we won’t do a price increase, but we have not done one and we are not currently contemplating one for this year. So we are trying to practice some patience here as we grow our business because things have been going well. All of that said, we are a tiny fraction of the cost. HubSpot actually raised their prices. We think that the equivalent price of our platform, excuse me, the product that HubSpot offers that’s sort of the equivalent of SharpSpring’s is HubSpot’s professional addition, which is $3,200 a month at this point. They did a substantial price increase for their existing customers. And so the value is in these products. Our model has been with our stage based on sort of a land grab opportunity and we think that that opportunity continues to be in front of us, so we evaluate these things. And I should say that in terms of the other competitors, the price points really go up from HubSpot at least in terms of the competitors that you mentioned, but we are grabbing people that are moving up from basic e-mail tools like Constant Contact and Mail Chimp and so forth into full marketing automation and we are filling a pretty large void in between those price points and offering a really fantastic marketing automation solution, but at a fraction of the cost of our competitors and we want to make sure that we maintain that gap. It doesn’t mean there is not plenty of room for a price increase on our side should we choose to move in that direction, but again we think there is a lot of opportunity for us with cross-selling and up-selling and gaining greater market share within each agency that works with us.

[Mike Malouf:]

Thanks for the help. Appreciate it.

[Rick Carlson:]

Mike, as always, thanks a bunch. Appreciate it. Good to hear from you.

[Operator:]

[Operator Instructions] There appear to be no further questions or comments at this time. This concludes our question-and-answer session. I would now like to turn the call back over to Mr. Carlson for his closing remarks.

[Rick Carlson:]

Thanks again everyone. Appreciate everybody joining the call today. As always, want to thank our employees, our partners, of course our investors and we are excited about the future and we will see you next time. Thanks so much.

[Operator:]

Before we conclude today’s call, I would like to provide SharpSpring’s Safe Harbor statement that includes important cautions regarding forward-looking statements made during this call. During today’s call, there were forward-looking statements made regarding future events, including SharpSpring’s future financial performance. These statements reflect the company’s current views with respect to future events. These forward-looking statements involve known and unknown risks, uncertainties and other factors, including those discussed under the heading Risk Factors and elsewhere in the company’s latest annual report on Form 10-K and quarterly reports on Form 10-Q that may cause actual results, performance or achievements to be materially different from any future results, performances or achievements anticipated or implied by these forward-looking statements. The company does not undertake any responsibility to revise any forward-looking statements to reflect the future events or circumstances. Also note that during this conference call, we may make reference to adjusted EBITDA, core net income or loss and core net income or loss per share, which are non-GAAP financial measures presented as supplemental measures of the company’s performance. A reconciliation of net income or loss to non-GAAP measures is included for your reference in the financial section of the earnings press release and made available on the company’s website. Finally, I would like to remind everyone that a recording of today’s call will be available for replay via a link available in the Investors section of the company’s website. Thank you for joining us today for SharpSpring’s fourth quarter and full year 2018 earnings conference call. You may now disconnect.