SharpSpring, Inc.
Q1 2016 Earnings Call Transcript

Published: 5 May 2016

[Operator:]

Good afternoon. Welcome to the SharpSpring’s First Quarter 2016 Earnings Conference Call. Joining us for today’s call is SharpSpring’s CEO, Rick Carlson; and CFO, Ed Lawton. Following their remarks, we will open up the call for your questions. Then before we conclude today’s call, I’ll 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 closed, we issued a press release announcing our results for the first quarter ended March 31, 2016, a copy of which is available on the Investor Relations section of our website. The first quarter of 2016 marks another record quarter for SharpSpring. In addition to achieving record top line results, we also added a record 250 new customers to our expanding base, ending the quarter just shy of 1,000 total paid customers. This also brought the total companies using SharpSpring marketing automation platform to nearly 4,000 companies. The quarter was also highlighted by the successful initiation of the planned migration of our GraphicMail customers onto our SharpSpring platform. I'm encouraged to report that the migration process has been relatively seamless and is now in its final stages. But before I comment further on our operational progress and provide an outlook for the rest of the year, I would like to turn the call over to our CFO, Ed Lawton, who will walk us through the financials for the quarter. Afterwards I'll return to provide more insights into our operational progress, key initiatives and outlook for the year. Ed?

[Ed Lawton:]

Thank you, Rick. Turning to our financial results for the first quarter ended March 31, 2016. Our revenue increased 28% to a record $4.2 million from $3.3 million in the same year-ago period. The improvement was driven by the strong growth in revenue from our SharpSpring marketing automation platform, which totaled a record $1.8 million or 43% of our total revenue for the quarter. This was up 167% from $678,000 in Q1 of last year. Revenue from our SMTP relay and e-mail service products totaled $2.4 million for the quarter, which if you exclude currency impacts, was down 5% from last year. The decrease was primarily due to the planned migration of our GraphicMail customers onto our new SharpSpring Mail+ platform, as well as our strategic decision to reallocate sales resources away from the GraphicMail product, leading up to this transition. While we may experience a short-term decline in revenue during Q2 or possibly even Q3 from our e-mail services business, we believe our SharpSpring Mail+ product has the potential to be a solid growth driver in the future. Our gross profit increased 13% to $2.8 million or 67% of total revenue from $2.5 million or 76% of total revenue in the first quarter of 2015. During the first quarter of 2016, we realized more infrastructure costs related to the GraphicMail migration to SharpSpring Mail+ because we ran both systems in parallel. Additionally we continued to invest in our support and network operations teams to more rapidly grow our SharpSpring marketing automation platform. Our operating expenses for the first quarter of 2016 decreased 5% to $3.8 million, compared to $4 million in Q1 of last year. The decrease was mostly due to a reduction in earn-out related charges. From a core perspective, our operating expenses increased $353,000 or 13% compared to last year. Our net loss for the first quarter totaled $710,000 or $0.10 per diluted share. This compares to a net loss of $1.2 million or $0.21 per diluted share in Q1 of 2015. Turning to our non-GAAP measures. Our adjusted EBITDA loss, defined as earnings before interest taxes, depreciation, amortization, non-cash stock-based compensation, our acquisition-related charges and restructuring expenses, for the first quarter of 2016 totaled $129,000. This compares to an adjusted EBITDA loss of $106,000 in the same year-ago period. Our actual adjusted EBITDA was significantly better than the guidance we provided on our call in March, in which we forecasted our adjusted EBITDA loss would range between $500,000 and $700,000. Our actual results for the first quarter reflected slower ramp in headcount and marketing expense compared to what we planned, while it's still overachieving on our sales targets. Although we spent less in Q1 than we originally forecasted, we currently anticipate increasing our headcount and marketing-related spending in the second quarter, which in turn will increase our EBITDA loss. Currently we are projecting an adjusted EBITDA loss between $200,000 and $400,000 for the second quarter of 2016. However in the second half of 2016, we plan to take incremental steps towards profitability as we grow our revenue base while keeping costs relatively fixed. We continue to project that we will achieve adjusted EBITDA breakeven in the fourth quarter and we’ll cross over to profitability in 2017. I'll now turn to our other non-GAAP metric, core net income, which excludes amortization, acquisition-related costs, stock compensation expenses and restructuring expenses while adjusting for taxes. In Q1 2016, we had a core net loss of $179,000 or $0.02 core net loss per share. This compares to core net loss of $152,000 or $0.03 core net loss per share in the same year-ago quarter. For more detail on our adjusted EBITDA and core net loss metrics, we encourage you to review the reconciliation to GAAP terms included in the supplementary tables of our earnings release. Turning to our balance sheet. We had $3.5 million in cash and cash equivalents at the end of the quarter, compared to $4.2 million at the end of the previous quarter. In mid-March we secured at $2.5 million revolving credit facility with a maturity date of March 2018. The facility strengthens our balance sheet and provides us with additional flexibility to meet under favorable terms any liquidity needs that may arise as we position ourselves to become profitable again. It also supports our ability to continue expanding our marketing automation platform and allows us to leverage our core marketing strength to meet the increasing demand for our solutions. So far we have not used this credit facility. In addition, we were a few weeks away from having all of the earn-out payments behind us related to our prior acquisitions. In Q1, we settled the GraphicMail earn-out and also recorded gain from the receipt of funds and shares from the escrow account related to GraphicMail. In April, we paid the cash for earn-out payment of $1 million to the former SharpSpring shareholders in connection with our acquisition of SharpSpring in August of 2014. Still to come in May is the issuance of approximately 1,000,000 shares of stock related to the SharpSpring share-based earn-out. Once this final share issuance is complete, all acquisition-related payments will be behind us. This completes my financial summary. For a more detailed analysis of our financial results, please reference our Form 10-Q which we plan to file by May 11. I'd now like to turn the call back over to Rick for additional insights into our operational progress in Q1 and outlook for 2016. Rick?

[Rick Carlson:]

Thanks Ed. During the first quarter, in addition to improving our financial performance, we also continued to build upon the strong momentum we established in 2015 in selling our marketing automation platform. This was demonstrated by the record 250 new customer additions we achieved in Q1, which was up 21% sequentially and 70% over the same year-ago period. Of the 250 new customers we added in the first quarter, 201 or 80% were secured through our U.S. sales team, while the other 20% or 49 customers were secured through our international channels. In aggregate, the new customers additions are expected to generate a record $1.75 million of annualized recurring revenue. These new numbers reflect our accelerated sales growth as we continue to convert more digital agencies to our easy-to-use, flexible and cost-efficient platform. This achievement was also driven in part by our investment in sales and marketing resources in the last few quarters, increased brand awareness amongst digital agencies and the growing overall demand for marketing automation solutions. Looking forward and echoing Ed’s earlier comments, our sales in Q2 may be slightly impacted by our focus on the GraphicMail migration, and our strong results in Q1 puts us in good shape to hit our overall goal of adding nearly 500 customers during the first half of the year. In terms of attrition, I'm pleased to report that we also saw attrition metrics return to normal levels in Q1 compared to the higher rates of attrition we experienced during Q4 of last year. We believe the improvement was primarily due to architectural enhancements we implemented during the late 2015 and early 2016 periods. During the next few quarters, we expect our attrition rates to remain in a normalized range of about 2.5%, which is in line with that of our industry peers. However we are taking additional steps to further improve our attrition beyond the levels seen by most of our competitors. To support our accelerated growth and expanding SharpSpring customer base, we are in the process of reorganizing our technical support team. This new organization will reduce headcount in the near-term and will benefit customers by providing better issue resolution, deeper product expertise and improving training materials and assistance. Although this updated support organization will be more efficient, we expect to add new support members relatively quickly as the business continues to expand. Additionally, we continue to take market share from our competition due to our platform’s unique capabilities as well as our differentiated go-to-market strategy. This success was recently confirmed by the record number of total customers on our platform. Late last month we surpassed the 1,000 paid customer milestone for SharpSpring, with nearly 850 of these customers paying digital marketing agencies that brings SharpSpring marketing automation to their end clients. And through those agencies and our direct relationships, SharpSpring has now been deployed to nearly 4,000 small and medium-sized businesses around the world. For a company of our size being able to secure 1,000 paid customers and nearly 4,000 businesses using the platform in two years, particularly with large and more established players in the industry, will tell to the success of our unique value proposition. Since our launch we have been focused on delivering a complete marketing automation platform that is both amazingly affordable and very flexible, so as to fit any clients’ environment. Our focus on extreme affordability and ease of use continues to define SharpSpring’s success. Surpassing this milestone and building on the momentum we have established, moves us one step closer to achieving our goal of more than doubling our marketing automation revenue in 2016. I'll now switch gears to our GraphicMail product, which is our web-based application for designing, managing and sending e-mail newsletters. Based on customer demand for increased functionality and capabilities, we began in late March with the migration of GraphicMail customers onto our core SharpSpring marketing automation platform. Due to our teams’ solid execution of the migration plan, I'm pleased to report that we've successfully completed the bulk of the migration process, which has been relatively seamless and is now in its final stages. Once the migration is complete by the end of May, we will have thousands of additional customers on our SharpSpring platform, all benefiting from a broad range of sophistic marketing automation tools like automated tasks and behavioral-based segmentation, which are designed to enhance the way businesses communicate and engage with their current and prospective customers. Additionally, we expect to shift the focus of our development team to do what we love, exciting new features for SharpSpring. We already have some in the works and are looking forward to sharing some exciting announcements with you shortly. Looking ahead, the first quarter represents a strong start to the year demonstrating the predictability and scalability of our business model. We are building on our operational and financial momentum and remain on track to achieve our financial goals for 2016, which includes doubling our SharpSpring revenue and more than tripling the number of businesses using our SharpSpring platform. And with that, we are ready to open the call for your questions. Operator, please provide the appropriate instructions.

[Operator:]

Thank you. We will now begin the question-and-answer session. [Operator Instructions] We'll pause for a moment as callers join the queue. Thank you. Our first question comes from Louie Toma from Craig-Hallum Group. Please go ahead.

[Louie Toma:]

Guys, congratulations on the nice quarter.

[Rick Carlson:]

Thank you.

[Ed Lawton:]

Thanks, Louie.

[Louie Toma:]

Well, I just had a couple of questions. Going back to the GraphicMail, can you talk a little bit about - when you first announced that you were going to do this transition and you had an idea of what you expected churn to be, can you talk about what you were actually seeing in churn and what that - how that compares to your prior expectations? And then secondly, can you talk a little bit about the profitability of the business after you convert these, and I guess, what I'm asking in that is, if all the people that churn are your unprofitable customers then you'd expect margins on that business to go up. Can I just get some insight on that, please?

[Rick Carlson:]

Yes, sure. So it's definitely two-part question there. The first part is best answered by saying we are cautiously very optimistic. So I think in our last earnings call, the question was asked that was pretty similar, what was our attrition expectations, and I think we signaled potentially up to 40%. That was prior to our migration. And at this point, we are essentially through the bulk of our migration from a revenue perspective, although we continue to migrate customers and that migration process, albeit, a herculean effort from the company's perspective has gone very well such that we're migrating customers - just to give investors, potential investors a flavor for what we're doing here, they essentially wake up the next day after having been communicated for several weeks and months that this would be coming and they are in the new interface with all of their data and so forth. So that process is going smoothly. People are embracing the new platform, and we are seeing very little attrition so far. I will say - I will hedge that very positive comment with just saying that the migration has really is taking place now and that we’ll see the ultimate results of that migration over this next quarter as people really get used to the platform and decide whether they like it or not. Again we are essentially upgrading people to a much more powerful solution with a lot of new advanced features and a nice user interface. And so we are cautiously optimistic at this point about the attrition rates coming in better than what we had signaled on the last call. Where that number actually ends up, is probably too early to tell. In terms of the profitability, I think that really was tied to losing customers and whether or not we are losing the unprofitable ones or not. We are not seeing a lot of loss now, so it almost makes that question, if not move, then too early to answer at this point. However our theory is if we do lose customers because the product is geared towards business users with more advanced features that we will see the attrition in the less sophisticated very small business segment, and so by definition those are the customers that would be less profitable. But again, cautiously optimistic right now that our migration has been very successful at this point. I should also mention at the risk of going on a little bit of too long that we had a large business development deal with a company to the tune of about $400,000 that we are not supporting, so that's kind of built-in to the attrition but that only represents about 10% of potential attrition associated with this migration, and so doesn't really affect the overall picture of very, very positive early news on the progress of the migration.

[Louie Toma:]

Got it.

[Rick Carlson:]

Hope that answers your questions.

[Louie Toma:]

That does. That was great. And then, Ed, I think you guys mentioned it, but gross margins ticked down in the quarter. Can you talk a little bit about the drivers behind that and what your expectations are on gross margins going forward, please?

[Ed Lawton:]

Yes. Sure, Louie. Yes, I did mention it was pretty much due to spending up a new infrastructure for our SharpSpring Mail product, SharpSpring Mail+ and running that essentially in parallel for most of the quarter. We've been incurring those costs ahead of time in conjunction with the migration of the GraphicMail customer base. So that was why it did tick down a little bit in the quarter. We are expecting it to gradually increase up to the 70%-ish level by the end of the year, so taking some small incremental steps up throughout the course of the year.

[Louie Toma:]

Got it. Thank you. And then my last question. Rick, this is probably best for you. When you look at some of the other competitors, HubSpot is probably a good example, a significant amount of their growth comes from being able to introduce new features that they upsell to customers, so not necessarily raising prices. But if you think about it from the amount of the increased revenues you can get per customer through new features and add-on sales, what is your thoughts on that longer term as a strategy?

[Rick Carlson:]

Yes, thanks for the question. It's really when you think about the SharpSpring business model, we have not one but two different ways that we can grow revenue from our customer base. The first is which you've already alluded to, it’s kind of the same thing that a company like HubSpot has, where we add features, potentially charge more for those features and that's why we really started talking a lot about the 4,000 customers that we currently have - roughly 4,000 customers that we currently have on the platform, because all of those represent opportunities to sell products to and services to. The second line item that I would add in terms of how we grow our revenues for customers is tied to our really unique business model having focused our business around marketing agencies. What we are seeing now is that agencies are adding more of their customers to the platform. I think our top agencies have in the 70s in terms of number of customers using the platform. So that grows that original customer, that agency partners’ monthly recurring revenue from a $500 mark, all the way up to many thousands of dollars. And so that's another way that we grow revenues from existing clients. Both of those opportunities are in front of us. I think we alluded to on the call having some exciting announcements moving forward, and it's really a matter of striking a balance between what you offer included in the platform to make sure that you have the right value proposition. We want ours to be untouchable and what we choose to charge additional services for as well. So that's something that we evaluate on a regular basis but we do have both of those opportunities out in front of us, and do have some announcements coming up in terms of product features and enhancements as well.

[Louie Toma:]

Got it. Thanks guys.

[Ed Lawton:]

Thanks, Louie.

[Operator:]

The next question comes from Eric Martinuzzi from Lake Street Capital Markets. Please go ahead.

[Eric Martinuzzi:]

Thanks. My congratulations as well on a successful Q1. The revenue in total for Q2 versus Q1, obviously you’ve got the two different directions going on here. But does that relatively flat versus where we finished out Q1?

[Ed Lawton:]

Yes, hi, Eric. It probably will be relatively flat. I think, Rick, mentioned a couple of the pieces that are being analyzed right now and we are cautiously optimistic that we can actually grow revenues from Q1 to Q2. But we are planning on some additional attrition and the loss of that kind of business development deal, so those will pullback revenues a little bit and we are forecasting probably flat to optimistically a slight improvement over Q1.

[Eric Martinuzzi:]

Okay. And then you said you hope to base the e-mail services businesses by Q3. Is that correct?

[Rick Carlson:]

I'm having difficulty hearing the question. Sorry, Eric.

[Eric Martinuzzi:]

No problem. I'll repeat the question. You're expecting the GraphicMail, the legacy business, e-mail services and SMTP relay, that business would reach a trough in Q3. Is that correct?

[Rick Carlson:]

Yes, that's our current projections. What we are - just to give you a feeling for that business, we really are replacing the GraphicMail product, what we think with a product with automation features, marketing automation features and really a nice set of features. We have a lot of excited resellers, former resellers of GraphicMail that are now reselling SharpSpring Mail+ and so we expect that this new product will ultimately be better arming those resellers to compete in the market and we'll see growth coming out of that line of business as well. And yes, in the meantime where we balance up the attrition from any migration, related attrition, people not liking the product and so forth and where that growth starts to take up from the resellers is a little bit difficult to forecast obviously, but Q2, Q3 is our best guess at that right now. And again we've been cautiously optimistic about the reception that we've received with the migration so far.

[Eric Martinuzzi:]

Okay. The 2.5% attrition number, was that a quarterly number or a monthly number?

[Rick Carlson:]

The 2.5% is a monthly number. It's a monthly number for - and that's specific to the SharpSpring marketing automation customers. It again is in line with what we see our competitors reporting as well and we are actually cautiously optimistic here that our business model might allow us to actually drop that number down further. Just one sentence on that. You can imagine as an agency partner with 10 clients on the platform, the barriers to switching are 10x higher than one end-customer choosing to switch from what is already a sticky platform. So it's another nuance of our business model that we are excited about. But right now 2.5% monthly attrition which is in line with what we are seeing from what we - the company reviews our peers.

[Eric Martinuzzi:]

Okay. And then stepping back, in Q1, you talked for the first time a go-to-market strategy that involves a direct to the end user campaign. I don't know how deep you are into that, if you are ready to comment on the rate of success you're having there. But just curious to know about your progress on the direct to end user?

[Rick Carlson:]

Yes, I think it's the time that we talked about. We talked about it in the context of experimenting. We really still feel the same way. We think that there is plenty of market for us in our - the market where we are - frankly we’re doing a great job right now. We've moved into the number two position in two years behind HubSpot in the digital agency market, ahead of just about every competitor that we are aware of as best as we can tell from publicly available data. And we don't see any end to the growth there, so we are reviewing the end-user market as an interesting possibility for us moving forward but are in no rush to do it incorrectly. In fact when we enter that market, we want to do so in a way that’s complementary to our agency partners. And so we continue to work on that. I won't tell you that we are very far down the road with that, but we are definitely doing some experimenting and some learning and do think that that's an opportunity for us as well.

[Eric Martinuzzi:]

Okay. And then for, Ed, a couple of housekeeping items. Given the share issuance in April and the cash issuance in May - sorry I've got that reversed. The cash issuance in April and the share issuance in May. What’s the pro forma cash balance we should use and then your weighted average share count for Q2?

[Ed Lawton:]

Weighted average share count in Q2 about 8.3, 8.4 million shares. The cash balance, I would project - we ended the quarter with about $3.4 million. We used the $1 million of that, as you mentioned already, some burn through operations and some of the reseller buyouts that we've been doing. It would be another few hundred thousand dollars on top of on EBITDA number. So EBITDA came just a little bit under $2 million for pro forma Q2 balance.

[Eric Martinuzzi:]

Okay. Well congratulations again. It's a terrific customer growth. You guys have been executing well and adding that really driving the SharpSpring base, and I think it's really the proof of the product, right. You're using it yourself to drive growth in your own customer base, so it must be working.

[Rick Carlson:]

That's right since day one, Eric. Thank you for saying that. That's absolutely true.

[Ed Lawton:]

Thanks Eric.

[Operator:]

[Operator Instructions] Our next question comes from Scott Billeadeau from Walrus Partners. Please go ahead.

[Scott Billeadeau:]

Guys, good quarter. I have got a couple, just three quick questions. First one on the GraphicMail integration. You talked about the integration going through. How does that work? Do you convert them and then you come back with what the actual pricing of that is going to be, and so they still have the - we haven't got to the point where, this is neat but I don't want to pay that for it. Maybe you could give me - and give us some clarity on where you are on that process?

[Rick Carlson:]

Sure, I can. The answer to that question is absolutely not, that's not how it works. What we've done effectively is made the migration process as seamless as possible. So we've brought over existing clients from GraphicMail, which are generally speaking billed on a monthly basis or usage basis with credits and so forth. We’ve honored all those agreements and kept billing essentially the same. So we no longer - these are not trials where people have to say, yes. In fact we’ve just simply honored the plans, given them a better product, pulled all of their data into that product for them. When I say their data, I mean all of their e-mails and all of their lists and so forth, such that they can wake up the next day after having been migrated to the new product - and that is the right term, migrated to the new product, and then login and use the product from day one and just keep doing what they've always done but with the benefit of a whole new set of features and new interface and exposure to marketing automation tools and so forth. So there is not some large looming unanswered question about whether or not these folks will actually say yes. They simply have to - they passively say, yes, by using the products because everything is seamless.

[Scott Billeadeau:]

Great. Spectacular. Okay. Good. Thank you for that. And then the other question was just, you had mentioned the $400,000 business development deal that you planned for that going away. Could you maybe give us a little more info on that, and is that basically going away this quarter, so that it will be gone that’s kind of part of the headwind you're running into?

[Rick Carlson:]

Yes. So I believe we are under nondisclosure with that company, so I can't name the company. But GraphicMail hovering around - I’m rounding significantly, but hovering around $5 million business. Had about $400,000 annual deal with the company that GraphicMail provided as a white-label solution for that we chose not to continue and we chose not to do that on our side because we didn't want to develop those features. And so that is paid out over - historically it's been paid out over the course of any given year that the contract was in place for and we are no longer continuing that, which is really the only meaningful, what I would call attrition, but again that was something that we chose to do out of that revenue base as of this particular moment still allowing for the concert that some people attrit from the new application simply because that's what happens when large user bases move from one application to another.

[Scott Billeadeau:]

Great, thanks. And then last question is related to - I think someone else may have asked the question of upselling or adding a feature and on the whole pricing aspect. We’re not saying that you penetrate [ph]. Now with your digital partners, you sell a couple of installations to them and then they somewhat resale or populate their customers. Maybe could you give us the sense for what ASPs are now, and then if you decide to - what metrics do you use around, this is reasonable to have as a separate thing and we got to do at least an $5 increments or $2. What are you thinking? Are you still trying to go through the process of - how do you get that price, and then do you get it just from your - ultimately your customers, the digital guy. He puts it on the ultimate customer or the ultimate users’ desktop. But who then is responsible for that increment should they choose it?

[Rick Carlson:]

Yes. Complex question that you asked and I may give you a little bit of a complex answer. Starting with, we are looking forward to having more than 10,000 businesses on the SharpSpring marketing automation platform once we complete this migration and assuming the growth of SharpSpring continues. And again we are already at 4,000 businesses using the platform through our organic means, what I would call an organic means. Each of those is a business that is using the SharpSpring marketing automation platform to drive their marketing, and in many cases their sales because they also adopt our CRM products. So it is not something that is, generally speaking, invisible to that end customer even if it was originally introduced by our agency partner. And so each of those 10,000 businesses represent an opportunity for us to offer various services, and I wish I could give you a more exact answer on the next part of my question or the next part of my answer. But really we evaluate features on a case-by-case basis. We are - in terms of whether we choose to charge for those features or build them into the product as value-add services. So we are completely focused on doing the best value and marketing automation which has really led to our success. We are feature comparable to all the incumbent players that charge many, many times what we charge for our services. We'll be adding new features that I think will make us more even more competitive. But there is absolutely the opportunity for us to add more features and charge separately for those. So it's - the way we try to evaluate that is we don't want to be in a situation where our customers feel like they are being nickeled and dimed with every little add-on feature. That's not what got us where we are today. But if a feature can be legitimately thought of as its own product, that is at least an opportunity for us to consider charging additionally for it. I hope that gives you a flavor for how we would make a decision like that. But the real answer is we use that criteria and make those decisions on a case-by-case basis. What we are excited about is having this growing user base on which to make those decisions.

[Scott Billeadeau:]

Yes, you have the opportunity. If you show so much value, then ultimately you can, whether it’s per feature or even, hey, I want a 3% price increase, so I’m giving you a lot of value anyhow, you drive it in there each year and then be able to actually do that. I don't know what the industry-wide is doing there on - is there a price increase that is going on with customers, or is it hard to - can you give a sense out there of what's happening?

[Rick Carlson:]

Every customer is different. I don't know how many people we have in the queue behind you. I just want to make sure we get to everybody's answers. But I very much appreciate the questions and thanks for the opportunity to talk about that user base.

[Scott Billeadeau:]

I appreciate it. Thanks.

[Rick Carlson:]

Take care.

[Scott Billeadeau:]

Yes.

[Operator:]

At this time, this concludes the question-and-answer session. I'd like to turn the conference back over to Mr. Carlson for any closing remarks.

[Rick Carlson:]

All right, so I cut that person off of just a little bit too short thinking there might be another question and there wasn't. I apologize for that. Listen, thanks everyone for joining the call today. I especially want to thank our unbelievably dedicated employees who have been working their tails off over the last few months, our agency partners and our investors, as always, thank you again for the continued support. And we look forward to updating you all on our next call. Operator?

[Operator:]

This concludes today's conference call. You may now disconnect your lines. Thank you for participating, and have a pleasant day.