Q4 2023 BigCommerce Holdings Inc Earnings Call

Good morning, ladies and gentlemen, thank you for standing by and welcome to the Big Commerce fourth quarter and fiscal year 2023 earnings call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session. Please be advised that today's conference is being recorded.

Operator: Good morning, ladies and gentlemen. Thank you for standing by, and welcome to the BigCommerce fourth quarter and fiscal year 2023 earnings call. At this time, all participants are in a listen-only mode.

Operator: After the speaker's presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your first speaker today, Tyler Duncan, Senior Director, Finance and Investor Relations. You may begin, sir.

I would now like to turn the conference over to your first speaker today, Tyler Duncan Senior Director Finance and Investor Relations you may begin Sir.

Good morning, and welcome to the Congresses fourth quarter and fiscal year 2023 earnings call. We will be discussing the results announced in our press release issued before today's market open with me are big Commerce, as Chief Executive Officer, and Chairman, Brent Bell and Chief Financial Officer, Daniel as.

Tyler Duncan: Good morning, and welcome to BigCommerce's fourth quarter and fiscal year 2023 earnings call. We will be discussing the results announced in our press release issued before today's market open. With me on the call are BigCommerce's Chief Executive Officer and Chairman, Brent Bellum, and Chief Financial Officer, Daniel Lynch. Today's call will contain certain forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning financial and business trends, our expected future business and financial performance and financial condition, and our guidance for the first quarter of 2024 and the full year 2024. These statements can be identified by words such as expect, anticipate, intend, plan, believe, seek, commit, or will or similar words.

Today's call will contain certain forward looking statements, which are made pursuant to the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.

Forward looking statements include statements concerning financial and business trends, our expected future business and financial performance and financial condition and our guidance for the first quarter of 2024 and the full year 2024.

These statements can be identified by words, such as expect anticipate intend plan believe seek committed will or similar words.

These statements reflect our views as of today, only and should not be relied upon as representing our views at any subsequent date and we do not undertake any duty to update these statements.

Tyler Duncan: These statements reflect our views as of today only and should not be relied upon as representing our views at any subsequent date, and we do not undertake any duty to update these statements. Forward-looking statements, by their nature, address matters that are subject to risks and uncertainties that could cause actual results to differ materially from expectations. For a discussion of material risks and other important factors that could affect our actual results, please refer to the risks and other disclosures contained in our filings with the Securities and Exchange Commission. During the call, we will also discuss certain non-GAAP financial measures that are not prepared in accordance with generally accepted accounting principles.

Forward looking statements by their nature address matters that are subject to risks and uncertainties that could cause actual results to differ materially from expectations.

For a discussion of the material risks and other important factors that could affect our actual results. Please refer to the risks and other disclosures contained in our filings with the Securities and Exchange Commission.

During the call. We will also discuss certain non-GAAP financial measures, which are not prepared in accordance with generally accepted accounting principles. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure as well as how we define these metrics and other metrics is included in our earnings press release, which has been furnished to the SEC.

Brent Bellum: The reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure, as well as how we define these metrics and other metrics, is included in our earnings press release, which has been furnished to the SEC and is also available on our website at investors.bigcommerce.com. With that, I will turn the call over to Brent. Thanks, Tyler.

Also available on our website at investors got Big Commerce Dot com.

With that let me turn the call over to Brett.

Thanks, Tyler and thanks, everyone for joining us I'm excited to share the progress and momentum that we see in our business and the strong execution. We showed in 2020. Three we began last year with the number one goal of improving our business and its ability to deliver sustainable profitability and positive cash flow that required difficult tradeoffs and disciplined execution.

Brent Bellum: And thanks, everyone, for joining us. I'm excited to share the progress momentum that we see in our business and the strong execution we showed in 2023. We began last year with the number one goal of improving our business's ability to deliver sustainable profitability and positive cash flow. That required difficult trade-offs and disciplined execution.

And I'm proud to say that our team has delivered on our commitment to our stakeholders. We finished the year with strong result, both topline and Bottomline and I'm encouraged by the underlying momentum in this business I'll begin my remarks today by addressing our financial performance at a high level and Daniel later cover our financial results in detail.

Brent Bellum: And I'm proud to say that our team has delivered on our commitment to our stakeholders. We finished the year with strong results, both on the top line and bottom line. And I'm encouraged by the underlying momentum in this business. I'll begin my remarks today by addressing our financial performance at a high level, and Daniel will later discuss our financial results in detail. The majority of my remarks will focus on what drives our business, our customers, and how we serve them. Their success is our passion.

The majority of my remarks will focus on what drives our business our customers and how we serve them. Their success is our passion I'll highlight notable accomplishments on behalf of our customers in 2023, where we are investing in 2024 and the go to market progress we are making.

Brent Bellum: I'll highlight notable accomplishments on behalf of our customers in 2023, where we are investing in 2024, and the go-to-market progress we are making. In 2023, we balance growth with significant improvement in operating cash flow. Q4 and full year revenue grew 16% and 11% year-over-year, respectively.

In 2020, three we balanced growth with significant improvement in operating cash flow.

Q4, and full year revenue grew 16% and 11% year over year, respectively non.

Brent Bellum: Non-GAAP operating margin improved by over 19 percentage points year-over-year to a positive margin of 6%. One year ago, we set a goal to hit quarterly break-even on an adjusted EBITDA basis in Q4. We exceeded that goal with adjusted EBITDA of nearly $7 million in Q4. In fact, we nearly reached adjusted EBITDA break-even for the full year.

non-GAAP operating margin improved over 19 percentage points year over year to a positive margin of 6% one year ago, we set a goal to hit quarterly breakeven on an adjusted EBITDA basis in Q4, we exceeded that goal with adjusted EBITDA of nearly $7 billion in Q4 and in fact, we nearly reached adjusted.

EBITDA breakeven for the full year, we delivered $13 million in operating cash flow on the quarter as well I am proud of the hard work and dedication of our team to make this happen, which Daniel will discuss in more detail in a few minutes.

Brent Bellum: We delivered $13 million in operating cash flow for the quarter as well. I'm proud of the hard work and dedication of our team to make this happen, which Daniel will discuss in more detail in a few minutes. Let's now focus on my favorite topic and our passion, our customers. It is my belief that BigCommerce can become the most loved e-commerce platform in the world. To maximize our customers' e-commerce success and platform satisfaction, we are making focused investments across all aspects of our business, our go-to-market teams, customer support teams, security, our partners, and, of course, our products. I'd like to elaborate on each one of these aspects a little further.

Let's now focus on my favorite topic at our passion our customers.

It is my belief the big Commerce can become the most loved ecommerce platform in the world.

Max Amaze, our customers ecommerce excel and platform satisfaction, we're making focused investments across all aspects of our business. Our go to market team customer support teams security our partners and of course, our products I'd like to elaborate on each one of these aspects a little further.

Brent Bellum: Our go-to-market teams relentlessly focus on identifying, signing, and launching customers' best position to thrive on BigCommerce. We have aligned the teams around our ideal customer profiles and have focused our sellers on the types of companies that are most successful using the BigCommerce platform and accompanying solutions. We also partner closely with the world's best agencies and systems integrators to maximize customer success.

Our go to market teams relentlessly focus on identifying signing and launching customers that's positioned to thrive on big Commerce, we have aligned the teams around our ideal customer profile and have focused our sellers on the types of companies that are most successful using the big commerce platform and accompanying solution. We also partner closely with the world's best agencies.

Integrators to maximize customer success.

Brent Bellum: Our customer support teams continue to be some of the most dedicated and well-respected in the industry. Our customers and partners know that when they have a support question or challenge, they can easily pick up the phone and speak to an actual BigCommerce employee. During Cyber Week, enterprise customers with priority support had to wait an average of only 13 seconds for their support calls to be answered, while customers with our standard base-level support had to wait on average only slightly more than 90 seconds.

Our customer teams continue to be some of the most dedicated and well respected in the industry, our customers and partners know that when they have a support question or a challenge they can easily pick up the phone and speak to an actual big commerce employee.

During cyber week enterprise customers with priority support had to wait an average of only 13 seconds for their support calls to be answer well customers with our standard base level support had to wait on average only slightly more than 90 seconds. We are innovating with generative AI tools to enable customers to get answers directly.

Brent Bellum: We are innovating with generative AI tools to enable customers to get answers directly in their store control panel, and customers resolve nearly a fourth of all support chats during the holiday period using this new technology without picking up the phone. We believe in the power of choice for our customers and will continue to offer multiple options for engagement. We believe that our security practices are industry-leading. We are the only e-commerce platform among our key competitors that has been awarded an ISO 27701 certification for privacy. This is the only certification designed to align with GDPR privacy requirements.

Store control panel and customers resolved nearly a fourth of all support chats during the holiday period, using this new technology without picking up the phone we believe in the power of choice for our customers and we'll continue to offer multiple options for engagement.

We believe that our security practices are industry, leading we're the only ecommerce platform. Among our key competitors that has been awarded an ISO 27 701 certification for privacy.

This is the only certification designed to align with GDP our privacy requirements. We also expect to soon have two new certification.

Brent Bellum: We also expect to soon have two new certifications, Coal Fire Systems Cloud Security and Cloud Privacy, awarding BigCommerce more international certifications than any of our major competitors. Simplifying e-commerce success is the goal of our product strategy, support model, and partner ecosystem. We partner with hundreds of exceptional e-commerce and performance marketing agencies around the world to help our customers grow their business. The number of agency developers completing our Advanced Certification Program grew 125% year over year in 2023, bolstering the deep pool of expert resources in B2C and B2B e-commerce and omni-channel growth dedicated to BigCommerce. We have grown from a platform-only business to a multi-product portfolio of world-class products and services, offering enterprise-grade security and functionality without sacrificing any of the ease and flexibility that comes with Open Sa Our customers want simple, elegant solutions to complex problems.

Fire systems cloud security and cloud privacy boarding big Commerce more international certifications than any of our major competitors.

Simplifying ecommerce success is the goal of our product strategy support model and partner ecosystem, we partner with hundreds of exceptionally commerce and performance marketing agencies around the world to help our customers grow their businesses. The number of agency developers completing our advanced certification programs grew 125%.

Year over year in 2023, bolstering the deep pool of expert resources, and B to C and B to B E Commerce, and Omnichannel growth dedicated to big Commerce.

We have grown from a platform only business to a multi product portfolio of world class products and services offering enterprise grade security and functionality without sacrificing any of the ease and flexibility that comes with open SaaS, our customers want simple elegant solutions to complex problems. They depends on the performance of the bed.

Brent Bellum: They depend on the performance of the BigCommerce platform, which continues to set the industry standard. For the 10th year in a row, we achieved 100% platform uptime over the Cyber 5 holiday selling period, and customers such as Luxo Living, Luna Cycle, and Priority Tire saw GMV growth rates of approximately 140 to 150% year-over-year during that period on BigCommerce. We invest to build not only a scalable, dependable platform but also to drive market-leading results for our customers, which are out-of-the-box checkout user experiences optimized with the world's leading payments and checkout providers to maximize conversion. In the back half of 2023, enterprise customers using any of our flagship payment solutions, plus PayPal Wallet and Apple Pay, achieved an average site visit conversion rate of 2.67%, which is 15% higher than the results reported by one of our closest competitors.

Commerce platform, which continues to set the industry standard for the 10th year in a row, we achieved 100% platform uptime or the cyber five holiday selling period and customers such as what's so living lunar cycle and priority tire side GMB growth rates of approximately 140% to 150% year over year during that period.

Big Commerce.

We invest to build not only a scalable dependable platform, but also to drive market leading results for our customers are out of the box checkout user experiences optimize with the world's leading payments and checkout providers to maximize conversion.

In the back half of 2023 enterprise customers using any of our flagship payment solution, plus Paypal wallet and Apple pay achieved an average site visit conversion rate up to six 7%, which is 15% higher than the results reported by one of our closest competitors. Similarly, the same enterprise stores achieved.

Brent Bellum: Similarly, those same enterprise stores achieved an average checkout conversion rate of approximately 71% during that period, which is roughly 46% higher than the Internet average of a little less than 50%. We are leveraging generative AI technology to drive customer growth on BigCommerce. Big AI is our suite of AI-powered tools that enables better conversion storefronts, more efficient store operations, and new creative ways to market and reach shoppers. Big AI Copywriter, built using generative AI from Google's Vertex AI, launched in 2023 and provides customers the capability to streamline their workflows and save time by generating high-quality, high-performing product descriptions matching their business's voices and target audiences.

And average checkout conversion rate of approximately 71% during that period, which is roughly 46% higher than the internet average of a little less than 50%.

We are leveraging generative AI technology to drive customer growth on Big Commerce, Big AI as our suite of AI powered tools that enables better converting storefronts more efficient store operation and new creative ways to market and reach shoppers.

They're getting a copywriter don't using Jarrett AI from Google's vertex AI launched in 2023 and provides customers the capability to streamline their workflows and save time by generating high quality high performing product description matching their businesses voices and target audiences.

Brent Bellum: Later this year, we will also launch product recommendations using Google's AI technology. Customers will be able to serve personalized and highly relevant product suggestions to their shoppers in real time, increasing average order value and conversion. In early tests on live stores, we've seen the solution drive more than a 20% increase in the click-through rate on related products and more than 100% lift in revenue among shoppers who engage with related products. We're also investing in semantic search, using AI to understand the intent of shoppers' search terms to deliver more accurate and relevant in-store search results, ultimately creating a better shopper experience and further increasing conversion rates. Our innovative AI use extends to FeedAnomics FeedAI, a proprietary AI tool that customers such as Conair, Ethan Allen, and Tacobas leverage as part of the FeedAnomics suite of solutions to categorize millions of products into the Google taxonomy with a 96% accuracy rate.

Later this year, we will also launch product recommendations using Google's AI technology.

Customers will be able to serve personalized and highly relevant product suggestions to their shoppers in real time, increasing average order value and conversion.

In early tests online stores, we've seen a solution drive more than a 20% increase in the click through rate on related products and more than 100% left and revenue amongst shoppers who engaged with related products.

We're also investing in semantic search using AI to understand the intent of shoppers search terms to deliver more accurate and relevant in store search result, ultimately, creating a better shopper experience and further increasing conversion rates.

Our innovative AI use extends to feed and omics feed AI, our proprietary AI tool that customers such as Con Air Ethan Allen.

Covid leverage as part of the feed and Omics suite of solutions to categorize millions of product to the Google taxonomy with a 96% accuracy rate.

<unk> customers can see strong improvements in return on advertising spend click through rate and Omnichannel revenue.

Brent Bellum: Fedonomics customers can see strong improvements in return on advertising spend, click-through rate, and omni-channel revenue. Dell uses fedonomics to categorize, enrich, and connect catalog data feeds via event-driven sync for 18 different channels, 17 different countries, and 9 different languages across 1.3 million SKUs globally. New Balance realized a 95% increase in return on ad spend by leveraging feedonomics as well. We have also recently released a beta program leveraging generative AI for creative content generation at scale. Similarly, a recently acquired visual site editor, MakeSwift, is investing in AI to generate page layouts and website creative content.

Now I'll use this feat and omics to categorize and rich and conduct catalog data feeds.

Event, driven sync for 18 different channel 17 different countries in nine different languages across $1 3 million Skus globally.

New balance realize the 95% increase in return on AD spend by leveraging feeding omics as well. We also recently released a beta program leveraging generative AI for creative content generation at scale.

Similarly, our recently acquired visual site editor makes weapon is investing in AI to generate page layout and website creative content. In addition to our native AI capabilities, we have empowered our partner and developer community to integrate their expertise seamlessly within our platform for example.

Brent Bellum: In addition to our native AI capabilities, we have empowered our partner and developer community to integrate their expertise seamlessly within our platform. For example, we've released an open source AI app foundation package simplifying generative AI integrations with BigCommerce. Twenty-seven powerful AI solutions already exist in our app marketplace, ranging from AI-powered merchandising, search, chat, and more.

We've released an open source AI App Foundation package, simplifying generative AI integrations with Big Commerce twenty-seven powerful AI solutions already exist in our apps marketplace ranging from AI powered merchandising search chat and more we are investing in AI technology to make running a growing business on big Commerce.

In Florida than ever and I'm very excited about the possibilities. This emerging technology presents to our customers.

Fundamentally their commerce empowers customers to build beautiful and engaging stores customers, such as British fashion and lifestyle brand white stuff have leveraged our platform and partners talking about agile flexible and fast tech stacks that can adapt to future needs two weeks ago, we announced catalysts, which ushers in the neck.

Brent Bellum: We are investing in AI technology to make running a growing business on BigCommerce simpler than ever, and I'm very excited about the possibilities this emerging technology presents to our customers. Fundamentally, BigCommerce empowers customers to build beautiful and engaging stores. Customers such as British fashion and lifestyle brand White Stuff have leveraged our platform and partners to compose agile, flexible, and fast tech stacks that can adapt to future needs. Two weeks ago, we announced Catalyst, which ushers in the next era of composable storefront technology, enabling customers to create incredible shopper experiences fast. It is purpose-built for today's modern commerce landscape and is optimized for the most important aspects of online Together with MakeSwift, it gives non-technical merchandisers and marketers powerful and flexible tools to design and publish beautiful and engaging site content, no coding required.

The era of Composedly storefront technology, enabling customers to create incredible shopper experiences faster. That's purpose built for today's modern commerce landscape and is optimized for the most important aspects of online commerce, including speed S E O mobile and acceptability.

Coupled with make swift.

Non technical merchandisers, and marketers powerful and flexible tools to design and publish beautiful and engaging site content no coding required.

Catalysts reception from developers and partners. So it's been extraordinary we believe catalyst and makes the full power of the next era of storefront experiences and will be a game changer for b to C and b to B E Commerce.

In partnership with Paypal, we have co develop the next generation of accelerated checkout called Fastly, which benefits from Paypal as existing network of over 400 million registered shoppers early test results are outstanding when fast Lane has enabled brands have seen conversion rates in the 70% range and accelerated checkout.

Brent Bellum: The reception from developers and partners has been extraordinary. We believe Catalyst and MakeSwift will power the next era of storefront experiences and will be a game-changer for B2C and B2B commerce. In partnership with PayPal, we have co-developed the next generation of accelerated checkout called Fastlane, which benefits from PayPal's existing network of over 400 million registered shoppers. Early test results are outstanding.

Nearly 40% faster than traditional guest checkout processes.

Brent Bellum: When Fastlane is enabled, brands have seen conversion rates in the 70% range and accelerated checkout speeds nearly 40% faster than traditional guest checkout processes. Our customers get the best of both worlds. Industry-leading checkout experience and conversion rates out of the box, plus the flexibility to customize as their businesses require it. Importantly, we provide our customers choice among the world's leading payment providers with best-in-class integration. We don't try to force the adoption of a proprietary payment system.

Our customers get the best of both world industry, leading checkout experience and conversion rates out of the box plus the flexibility to customize as their businesses require it importantly, we provide our customers choice among the world's leading payment providers with best in class integration, we don't try to force adoption of our proprietary payment solution we don't.

Surcharge customers using the solution of their choice and we don't surcharge them for VW transactions. The combination of payments choice exceptional integrations and superior checkout user experience are what drive great checkout conversion and payments economics for our customers.

Brent Bellum: We don't surcharge customers for using the payment solution of their choice, and we don't surcharge them for B2B transactions. The combination of payment choice, exceptional integrations, and superior checkout user experience are what drive great checkout conversion and payments economics for our customers. In May, BigCommerce launched the B2B Buyer Portal, the most modern, out-of-the-box B2B buying experience of any e-commerce platform.

In May the commerce launched the BTB buyer portal the most modern out of the box me to be buying experience of any e-commerce platform.

New functionality has passed with the features PDP businesses need to engage their buyers quoting invoicing buyer approval workflows automated trade applications and much more our beta customers are seeing incredible results M came building supply as the largest independent building supplies distributor in the United Kingdom Rep.

Brent Bellum: This new functionality is packed with the features B2B businesses need to engage their buyers, such as quoting, invoicing, buyer approval workflows, automated trade applications, and much more. Our B2B customers are seeing incredible results. MKM Building Supplies, the largest independent building supplies distributor in the United Kingdom, revolutionized their e-commerce site using BigCommerce's B2B functionality, delivering a personalized omnichannel experience rarely seen in B2B. The results speak for themselves. MKM saw a 44% increase in average order value and a 42% increase in store traffic, leading to an 82% increase in revenue. But it's not just about one story.

Pollution is their ecommerce site using the E. Commerce is b to b functionality, delivering a personalized omnichannel experience rarely seen in b to b.

The results speak for themselves.

Hey, I'm saw 44% increase in average order value and a 42% increase in store traffic, leading to an 82% increase in revenue but.

But it's not just about one story and 2023, we welcomed industry Giants like twin liqueurs, a a P C medical Asahi beverages, Bunzl, Striction sports and imperial data as well.

Total <unk> to be addition, GMB grew 78% year on year, and we're laser focused on extending big commerce as leadership position in <unk> e-commerce to help our customers grow and scale efficiently.

Brent Bellum: In 2023, we welcomed industry giants like Twin Liquors, AAPC Medical, Asahi Beverages, Bunzl, Srixen Sports, and Imperial Date as well. Total B2B addition GMV grew 78% year-on-year, and we're laser-focused on extending BigCommerce's leadership position in B2B e-commerce to help our customers grow and scale efficiently. Our latest multi-storefront features make it even easier for customers like Brompton Bicycles to sell in multiple geographies, allowing brands and B2B businesses to deliver high-converting, fully-localized experiences.

Our latest multi storefront features make it even easier for customers like Brompton bicycles to sell in multiple geographies, allowing brands and <unk> businesses to deliver high converting fully localized experiences all centrally and efficiently managed from a single store instance.

This saves customers' time and money that would otherwise be spent managing individual store instances for each market customers can streamline their international expansion by swiftly watching storefronts worldwide without clones and localize the entire customer journey across search shopping and shipping for a tailored experience.

Brent Bellum: All centrally and efficiently managed from a single store, This saves customers time and money that would otherwise be spent managing individual store instances for each market. Additionally, customers can streamline their international expansion by swiftly launching storefronts worldwide without clones and localizing the entire customer journey across search, shopping, and shipping for a tailored experience. Efficient management of global storefront channels from a centralized back-end enables rapid launches, changes, and optimizations, all while reducing the need for extensive custom development work. As I close, I would like to look back on our performance and priorities. I said on our fourth-quarter 2022 earnings call that our number one business priority for 2023 was profitability. We have improved our non-GAAP operating profit margin by 26 points in the last six quarters. We met our goal, and I'm proud of our team for doing so.

Management of global storefront channels from a centralized backend enables rapid launches changes and optimization, all while reducing the need for extensive custom development work.

As I close I would like to look back on our performance and priorities I sat on our fourth quarter 2022 earnings call that our number one business priority for 2023 was profitability.

We have improved our non-GAAP operating profit margin by 26 points in the last six quarters.

We met our goal and I'm proud of our team for doing so.

Look forward to 2024, it's time for us to build on our strong financial position and accelerate top line momentum 2020, threes number one priority was profitability two.

'twenty 'twenty four is the number one priority is sufficient revenue growth.

Ultimately it all comes back to taking care of our customers. We are passionate about serving our customers not just because it's the right thing to do for them, but also because its the best way to drive long term value for big Commerce customer focus can help make us the most loved ecommerce platform and partner in the world and it can deliver healthy long term return.

Brent Bellum: As I look forward to 2024, it's time for us to build on our strong financial position and accelerate top-line momentum. 2023's number one priority was profitability. 2024's number one priority is efficient revenue. Ultimately, it all comes back to taking care of our customers. We are passionate about serving our customers, not just because it's the right thing to do for them, but also because it's the best way to drive long-term value for BigCommerce. Customer focus can help make us the most loved e-commerce platform and partner in the world, and it can deliver healthy, long-term returns for our shareholders. And with that, I'll turn it over to Daniel.

For our shareholders.

With that I'll turn it over to Daniel.

Thanks, Brent and thank you everyone for joining us today.

During my prepared remarks, I will cover our Q4 and full year 2023 results in detail provide additional detail on our progress in 2023, both where we're showing strengthening trends and where we need to improve and provide guidance for Q1 and the full year of 2024.

In Q4 revenue was just over $84 million up 16% year over year full year 2023 revenue grew to $309 million up 11% year over year.

In Q4 subscription revenue grew 14% year over year to approximately $61 million, while partner in services revenue or <unk> was up 23% year over year to just under $24 million driven by strong seasonal consumer spending.

Revenue in all of the Americas was up approximately 15%, while EMEA revenue grew 24% and APAC revenue was up 22% compared to prior year.

Daniel Lynch: Thanks, Brent, and thank you, everyone, for joining us today. During my prepared remarks, I will cover our Q4 and full year 2023 results in detail, provide additional detail on our progress in 2023, both where we are showing strengthening trends and where we need to improve, and provide guidance for Q1 and the full year 2020. In Q4, revenue was just over $84 million, up 16% year-over-year. Full-year 2023 revenue grew to $309 million, up 11% year-over-year.

Our Q4 non-GAAP operating income was just over $5 million and the full year was a loss of $6 million in.

In the last six quarters, our business has grown from a non-GAAP operating margin of approximately negative 20% to a non-GAAP operating margin of positive 6%.

That's more than a 26 point improvement in profitability and only six quarters that progress reflects the hard work and dedication of our entire team and it fulfills the commitment to profitability that we made to shareholders at the beginning of 2023. We've also made significant improvements in cash, finishing Q4 with operating cash flow and free cash.

Daniel Lynch: In Q4, subscription revenue grew 14% year-over-year to approximately $61 million, while partner and services revenue, or PSR, was up 23% year-over-year to just under $24 million, driven by strong seasonal consumer spending. Revenue in all of the Americas was up approximately 15%, while EMEA revenue grew 24%, and APAC revenue was up 22% compared to prior years. Our Q4 non-GAAP operating income was just over $5 million, and the full year was a loss of $6 million.

Cash flow of $13 million and 12 million respectively. This progress in both non-GAAP operating income and cash flow is evidence of our continued commitment to operating a strong profitable long term growth business.

We concluded Q4 with an annual revenue run rate or <unk> of nearly $337 million up 8% year over year that represents a sequential growth in <unk> of just over 4 million enterprise account <unk> was approximately $245 million up 9% year over year as at the end of Q4.

Enterprise accounts represented 73% of our total company, a or our accounts using exclusively our retail plans, which we referred to as non enterprise accounts finished with a or are slightly over $91 million up 4% year over year I'll speak in more detail to what we're seeing with respect to our growth and what we're seeing from a macroeconomic point of view as well.

Daniel Lynch: In the last six quarters, our business has grown from a non-gap operating margin of approximately negative 20% to a positive non-gap operating margin of positive. That's more than a 26 point improvement in profitability in only six quarters. That progress reflects the hard work and dedication of our entire team, and it fulfills a commitment to profitability that we made to shareholders at the beginning of 2020. We've also made significant improvements in cash, finishing Q4 with operating cash flow and free cash flow of $13 million and $12 million, respectively. This progress in both non-GAAP operating income and cash flow is evidence of our continued commitment to operating a strong, profitable, long-term business. We concluded Q4 with an annual revenue run rate, or ARR, of nearly $337 million, up 8% year-over-year. That represents a sequential growth in ARR of just over $4 million. The enterprise account ARR was approximately $245 million, up 9% year-over-year.

Into 2024 later in my remarks.

Like many other software companies, we redoubled, our efforts to drive efficiency and profitability improvements in response to market conditions during 2022, and our business has executed a notable financial transformation over the last six quarters as a result, even as we take decisive steps to Reaccelerate top line growth we have delivered.

Major improvements to our financial results over the last six quarters. Adjusted EBITDA has grown from approximately negative $13 million or an adjusted EBITDA margin of negative 19% to approximately positive $7 million or an adjusted EBITDA margin a positive 8% that represents an average quarter over quarter adjusted EBITDA margin.

Improvement of 444 basis points every quarter for six consecutive quarters.

We've made significant improvements in working capital and collections decreasing days sales outstanding or DSO from 61% to 41 days when nearly doubled our deferred revenue balance from approximately 17 million to $32 million and drove prepayment levels over four times higher as we continue to make progress with advanced billing with our customers and partner.

Daniel Lynch: As of the end of Q4, enterprise accounts represent 73% of our total company ARR. Accounts using exclusively our retail plans, which we refer to as non-enterprise accounts, finished with ARR slightly over $91 million, up 4% year-over-year. I'll speak in more detail to what we're seeing with respect to ARR growth and what we're seeing from a macroeconomic point of view as we head into 2024 later in my remarks. Meanwhile, like many other software companies, we redoubled our efforts to drive efficiency and profitability improvements in response to market conditions during 2020. And our business has executed a notable financial transformation over the last six quarters as a result. Even as we take decisive steps to re-accelerate top-line growth, we have delivered major improvements to our financial results.

I expect deferred revenue and the current portion of remaining performance obligations or <unk> to become more indicative of the underlying health of our business as well.

This progress drove significant improvement in cash flow apart from the acquisition related payments for feed and Omics and mixed with a 32, five and $9 million, respectively, 2023 free cash flow finished at just over $13 million compared to underlying non-GAAP operating loss of just under $6 million on top of these improvements to profitability.

And cash flow. We also remain focused on strong stewardship of our equity programs stock based compensation finished Q4 at 9% of revenue compared to 17% a year ago. This has driven a lower annual net dilution of approximately three 7% in 2023 compared to six 6% in 2022.

Daniel Lynch: Over the last six quarters, Adjusted EBITDA has grown from approximately negative $13 million, or an Adjusted EBITDA margin of negative $19 million, to approximately positive 7 million, or an Adjusted EBITDA margin of positive 8%. That represents an average quarter-over-quarter adjusted EBITDA margin improvement of 444 basis points, every quarter for six consecutive quarters. We've made significant improvements in working capital and collections, decreasing Days Sales Outstanding, or DSO, from 61 to 41 days. We nearly doubled our deferred revenue balance from approximately $17 million to $32 million and drove prepayment levels over four times higher.

As Brent discussed we continue to Orient our business around the best interest of our customers our partners and ecosystem are core tenants of our customer first approach is the freedom of choice are open SaaS platform offers the ecommerce customers get to pick the best in breed partners for their particular use case, unlike what we're seeing across the e-commerce.

Space, we're not pressuring our customers into using solutions that are self serving we take an agnostic approach to partners. In addition to flexibility. This approach is also economically advantageous for our customers. For example, we offer integrations with many of the world's leading payments partners and we do not impose additional fees on our customers' base.

Daniel Lynch: As we continue to make progress with advanced billing with our customers and partners, I expect Deferred Revenue and the current portion of Remaining Performance Obligations, or RPO, to become more indicative of the underlying health of our business as well. This progress drove a significant improvement in cash, apart from the acquisition-related payments for Fedonomics and Migswift of $32.5 and $9 million, respectively. 2023 free cash flow finished at just over $13 million compared to an underlying non-GAAP operating loss of just under $6 million.

On their payment processor choice Midmarket and enterprise customers on Big Commerce can save 25% or more off their existing credit card processing fees by leveraging rates with big Commerce as preferred payments partners. In some cases this savings can more than offset the cost of the big commerce platform itself and that 25% savings on payment processing doesn't even.

Count for the surcharges some of our leading competitors required to pressure customers since you're using their white label payment solutions or additional surcharges recently introduced on <unk> orders as well.

Daniel Lynch: On top of improvements in profitability and cash flow, we also remain focused on strong stewardship of our equity. Stock-based compensation finished Q4 at 9% of revenue compared to 17% a year ago. This has driven a lower annual net dilution of approximately 3.7% in 2023 compared to 6.6% in 2022.

We maintain the view.

That our customer first open platform as a core differentiator for big Commerce, and we see this becoming exponentially more valuable to customers as our competitors shift increasingly to a walled garden approach our approach leads to better relationships with our customers improves retention and enables customers to adjust their technology choices to their needs.

As they grow without needing to re platform.

As I discussed last quarter, we have streamlined our go to market motions and organizational structure to reinforce the criticality of our customers historically, our business has source revenue growth disproportionately from new customer acquisition, our Q3, 2023 restructuring and 2024 financial plan aimed for a more balanced growth profile.

Daniel Lynch: As Brent discussed, we continue to orient our business around the best interests of our customers, our partners, and the ecosystem. A core tenet of our customer-first approach is the freedom of choice our OpenFast platform offers. BigCommerce customers get to pick the best-in-breed partners for their particular use case. Unlike what we're seeing across the e-commerce space, we are not pressuring our customers into using solutions that are self-serving. We take an agnostic approach to partners.

Between existing customers and new customers that restructuring consolidated all go to market efforts under the leadership of our global President role. While we are actively recruiting a strong go to market leader to step into that role we are not missing a beat on our plans for 2024, we have a playbook that is oriented around sustainable customer first retention and growth of <unk>.

Daniel Lynch: In addition to flexibility, this approach is also economically advantageous for our customers. For example, we offer integrations with many of the world's leading payment partners, and we do not impose additional fees on our customers based on their payment process. Mid-market and enterprise customers on BigCommerce can save 25% or more off their existing credit card processing fees by leveraging rates with BigCommerce's preferred payment partners.

Product portfolio of market, leading solutions and a long tenured highly motivated commercial team we're already seeing signs of success. In this improved model cross sell results are improving retention is improving and we continue to see healthy competitive win rates as well. We are confident that these improvements will also drive improvements to our net revenue.

Retention or in our R, which finished at 100% for enterprise accounts in 2023.

Daniel Lynch: In some cases, this savings can more than offset the cost of the BigCommerce platform itself. And that 25% savings on payment processing doesn't even account for the surcharges some of our leading competitors require to pressure customers into using their white-label payment processing, or additional surcharges recently introduced on B2B orders as well. We maintain the view that our customer-first open platform is a core differentiator for BigCommerce, and we see this becoming exponentially more valuable to customers as our competitors shift increasingly to a walled garden. Our approach leads to better relationships with our customers, improves retention, and enables customers to adjust their technology choices to their needs as they grow without needing to replatform. As I discussed last quarter, we have streamlined our go-to-market activities and organizational structure to reinforce the criticality of our customers.

Let me take a moment to elaborate on what we're seeing with respect to revenue and they are our two primary macroeconomic factors affect our business consumer spending and platform investments spending consumer spending has proven a bit more resilient than we had planned particularly during the holiday period in Q4, I'm cautiously optimistic by the trends I see in this era.

Although I believe we will continue to face risks in key markets such as the U S and the U K in 2024.

Signals on platform investment spending remained mixed sales cycle times remain elevated and customers continue to seek opportunities to reduce contractual volumes to decrease spending though at a lower rate than what we saw during mid 2023 competitive win rates remain healthy in our redoubled focus on gross and net retention is showing positive results and recent.

Months as well overall, we are taking a cautious approach to 2024, and our plans balanced investments against our ideal customer profiles and key markets with the need to run the business in a lean accountable way.

I would now like to shift to discuss our three main financial focus areas for 2024 first while we made significant progress in the financial performance of the business. In 2023, we are not satisfied with our top line growth rates as Brent said, our number one priority in 2020 for efficient revenue growth and we have the people.

Daniel Lynch: Historically, our business has sourced revenue growth disproportionately from new customer acquisition. Our Q3 2023 restructuring and 2024 financial plan aim for a more balanced growth profile between existing customers and new customers. That restructuring consolidated all go-to-market efforts under the leadership of a global president.

The partnerships and products to do so for example, we have improved our processes and measurements to evaluate our go to market performance and efficiency, including customer first goals that measure product performance and quality customer satisfaction and improvements to gross and net revenue retention. We are confident that these shifts in our go to market will unlock faster.

Daniel Lynch: While we are actively recruiting a strong go-to-market leader to step into that role, we are not missing a beat on our plans for 2020. We have a playbook that is oriented around sustainable, customer-first retention and growth, a multi-product portfolio of market-leading solutions, and a long-tenured, highly-motivated sales force. We're already seeing signs of success in this improved model.

Revenue growth as the year progresses by driving improvements in our R and focusing on customer expansion and cross sell.

Second our goal is to improve our non-GAAP operating margin in the mid single digits on a full year basis as Ive said, our progress thus far it is notable that our commitment to improving profitability is unchanged, even as we look to improve revenue growth rates as we progress through 2024.

Daniel Lynch: Cross-sell results are improving, retention is improving, and we continue to see healthy competitive win rates as well. We are confident that these improvements will also drive improvements in our Net Revenue Retention, or NRR, which finished at 100% for enterprise accounts. Let me take a moment to elaborate on what we're seeing with respect to revenue and ARR. Two primary macroeconomic factors affect us: Consumer Spending and Platform Investments. Consumer spending has proven a bit more resilient than we had planned, particularly during the holiday period in Q4.

Third we have seen success in driving consistent cash flow generation, we will continue to focus on advanced billings on new subscriptions. We will also invest in systems to improve customer data management CRM capabilities quote to cash processes and back office systems and controls, while maintaining tight discipline around accounts receivable and collections.

I continue to be encouraged by our progress in this area and I believe we will continue to see further improvement through 2024.

I will now share an updated view on our outlook and guidance for the first quarter and full year 2024.

For the first quarter, we expect revenue in the range of 76 to 78 million, implying a year over year growth rate of 6% to 9% for the full year, we expect revenue between $327 1 million to $335 1 million translating to a year over year growth rate of approximately 6% to eight <unk>.

Daniel Lynch: I'm cautiously optimistic about the trends I see in this area, though I believe we will continue to face risk in key markets, such as the U.S. and the U.K., in 2020. Signals on platform investment spending remain mixed, sales cycle times remain elevated, and customers continue to seek opportunities to reduce contractual volumes to decrease spending, though at a lower rate than what we saw during mid-2020. Competitive win rates remain healthy, and our redoubled focus on gross and net retention is showing positive results in recent months as well.

<unk> for Q1, our non-GAAP operating income is expected to be between one and $2 million for the full year, we expect non-GAAP operating income between $8 5 million and $12 5 million note that we expect revenue growth rates and profit margins to be sequentially lower in the first quarter compared to the prior quarter. This is primarily due to the Q4.

Seasonal factors and partner in services revenue that I mentioned earlier and planned sales and marketing spend in Q1.

Our outlook reflects an assumption that similar to 2023 consumer spending remains resilient the muted and the business investment remains cautious in 2024. In addition, we expect our recent go to market restructuring to yield strong long term improvements in top line growth. We are taking our moderately conservative view on front half growth as we execute those.

Daniel Lynch: Overall, we are taking a cautious approach to 2024, and our plans balance investments against our ideal customer profiles and key markets with the need to run the business in a lean, accountable way. I would now like to discuss our three main financial focus areas for 2020. First, while we made significant progress in the financial performance of the business in 2023, we are not satisfied with our top line growth. As Brent said, our number one priority in 2024 is efficient revenue growth. And we have the people, the partnerships, and products to do so. For example, we have improved our processes and measurements to evaluate our go-to-market performance and efficiency, including customer-first goals that measure product performance and quality, customer satisfaction, and improvements to gross and net revenue returns.

Changes, while 2023 was a challenging year for big Commerce in many respects I am tremendously proud as the financial improvements. We delivered again, we have a long way to go we are not satisfied and we're committed to our customers and to our shareholders. We believe that we have the best customers in the world and it's by aligning our success with theirs that we will.

<unk> to drive profitable revenue growth for our team and our shareholders with that rents and I are happy to take any of your questions operator.

Thank you we will now begin the question and answer session to.

To ask a question you May Press Star then one on your Touchtone phone.

If you're using a speakerphone please pick up your handset before pressing the keys.

The time of your question has been addressed you would like to withdraw your question. Please press Star then two and at this time, we'll pause momentarily to assemble our roster.

And the first question today will come from Ken Wong with Oppenheimer <unk> Company. Please go ahead.

Daniel Lynch: We are confident that these shifts in our go-to-market will unlock faster revenue growth as the year progresses by driving improvements to NRR and focusing on customer expansion and cross-sector. Second, our goal is to improve our non-GAAP operating margin to the mid-single digits on a full-year basis. As I've said, our progress thus far is notable, but our commitment to improving profitability is unchanged, even as we look to improve revenue growth rates as we progress through 2025. Third, we have seen success in driving consistent cash flow generation.

Okay. Thanks for taking my question up Brett.

Brett.

Or maybe Daniel I wanted to just maybe circle up on just.

The go to market you guys mentioned consolidating everything under the President's role.

Obviously vacated by Steven Chung, how should we think about sales execution in the first half relative to your guide.

This require someone to step into that role before we start to see some some acceleration.

This is Brent thanks, Ken there'll be no loss of momentum Stephen and his six months here made some tremendously positive changes in our go to market model. All of those are now in place we have very strong regional gms in each of the Americas EMEA.

Daniel Lynch: We will continue to focus on advanced billing on new subscriptions. We will also invest in systems to improve customer data management, CRM capabilities, quote-to-cash processes, and back-office systems and controls, while maintaining tight discipline around accounts receivable and collection. I continue to be encouraged by our progress in this area, and I believe we will continue to see further improvement through 2020. I'll now share an updated view on our Outlook and Guidance for the first quarter and full year 2024. For the first quarter, we expect revenue in the range of $76 to $78 million, implying a year-over-year growth rate of 6% to 9%. For the full year, we expect revenue between $327.1 million and $335.1 million, translating to a year-over-year growth rate of approximately six to eight. For Q1, our non-GAAP operating income is expected to be between $1 and $2 million.

And APAC they lead sales no loss in momentum and I'm expecting us to be better than ever as we go forward.

I have close relationships with all of those reports I was obviously president up until six months ago, and I am again on an interim basis I'm focused on hiring.

<unk>, new president to come in and we'll get that person as fast as we can no loss of momentum though.

Okay Fantastic and then just really quickly any any color on how we should be thinking about the split between subscription and services as we build out our models for next year.

Yeah, I would say thanks, Ken I would say pretty balanced I mean, we're expecting growth rates to be pretty similar as we think about the guide and early quarters, Q1, especially where we're coming off of a really good seasonal quarter in Q4, I expect DSR growth rates to be a little bit lower than where we are on subscription, but overall for the year, we expect it to be relatively balanced.

Daniel Lynch: For the full year, we expect non-GAAP operating income between $8.5 million and $12.5 million. Note that we expect revenue growth rates and profit margins to be sequentially lower in the first quarter compared to the prior quarter. This is primarily due to the Q4 seasonal factors and partner and services revenue that I mentioned earlier, and planned sales and marketing. Our outlook reflects an assumption that, similar to 2023, consumer spending remains resilient, though muted, and that business investment remains cautious in 2020. In addition, though we expect our recent go-to-market restructuring to yield strong long-term improvements in top-line growth, we are taking a moderately conservative view on front-half growth as we execute those plans. While 2023 was a challenging year for BigCommerce in many respects, I am tremendously proud of the financial improvements we delivered. Again, we have a long way to go.

Okay perfect. Thanks, guys.

The next question will come from Kochi Aikido with Bank of America. Please go ahead.

Yeah, Hey, guys. Thanks for taking the questions.

I wanted to ask about margin expansion. So when looking at the guidance, it's about five points of margin expansion for less than 10% growth in 2024.

Is this the right way to think about a framework for margin expansion over the medium term and then.

How should we be thinking about the bridge between potentially slowing down margin expansion in the future to drive higher growth how long could that bridge.

Great question Koji I would say at least as we're thinking about going into the front half of the year I think that's reasonable and is reflected in the guide what Brent and I really wanted to get across.

In the prepared remarks is how we're thinking about this year.

Daniel Lynch: We are not satisfied, and we're committed to our customers and to our shareholders. We believe that we have the best customers in the world, and it's by aligning our success with theirs that we will continue to drive profitable revenue growth for our team and our shareholders. With that, Brent and I are happy to take any of your questions. Operator?

In 2023, we were really really really focused on executing a transformation with respect to profitability and with respect to cash flow that comes with a cost and we said going into the year that if we had the sacrifice a couple of points of growth in order to get an outsized change to what we were doing from a cash flow and a profitability perspective that we would do that.

I do not believe that we overcorrected that said, we definitely want to focus in 2024 and this is clear throughout the organization to be on accelerating top line. The top line momentum in an efficient way and going into the year, we're taking a little bit of a conservative view, which we think is prudent given mark given market conditions and I think that's reflected in the guidance.

Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your touchtone phone.

Ken Wong: If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been answered, and you would like to withdraw your question, please press star then 2. And at this time, we'll pause momentarily to assemble our roster. And the first question today will come from Ken Wong with Oppenheimer and Company. Please go ahead.

But we're wanting to make bets. We think we are in a really really good position to really build on the financial situation that we're in which is very very good and start getting topline growth rates, where we expect them to be where investors expect them to be and we think that we can definitely do that.

Got it thank you Daniel and as a follow up here I wanted to ask about.

Ken Wong: Oh, fantastic. Thanks for taking my question. Brent or maybe Daniel, I wanted to maybe circle back on just the go-to-market. You guys mentioned consolidating everything under the president's role, but that was obviously vacated by Stephen Chung.

The pricing increase that occurred last year. So I realize it was announced about a year ago and began to roll through the customer base around June 1st I do understand that the monthly versus annual discount mechanics. So just just wanted to hear some commentary on how much contribution there could there could be.

Brent Bellum: How should we think about sales execution in the first half relative to your guide? Does this require someone to step into that role before we start to see some acceleration? This is Brent.

The monthly customer price increase that's embedded in the guidance I guess, specifically around as a tailwind for the first half of 'twenty four.

Brent Bellum: Thanks, Ken. There'll be no loss of momentum. Stephen, in his six months here, made some tremendously positive changes to our go-to-market model. All of those are now in place. We have very strong regional GMs in each of the Americas, EMEA, and APAC. They lead sales with no loss in momentum, and, you know, I'm expecting us to be better than ever as we go forward. I have close relationships with all of those people. I was obviously president up until six months ago, and I am again on an interim basis.

Yes, let me elaborate on that and let me speak to the question specifically and then maybe just address pricing philosophically just a little bit in general because there's been a lot going on in our industry in this over the course of the last several months.

Honestly, even in the last several days so with respect specifically to the pricing action that we did last year on small business plans.

We have that tailwind baked into the guidance that affected primarily small business customers. We really have been encouraging small business customers to not go up in price honestly, but rather just to focus on annual prepay, we think that that creates some stability for for them as they look at the invoices. They get that's also more stable for US obviously as we plan the business and it's better for us.

Brent Bellum: I'm focused on hiring a great new president to come in. We'll get that person as fast as we can. No loss of momentum, though.

Daniel Lynch: Okay, fantastic. And then, Daniel, just really quickly, any color on how we should be thinking about the split between subscriptions and services as we build out our models for next year? Yeah, I would say, thanks Ken, I would say pretty balanced.

A working capital point of view, we also take private pricing from time to time on the enterprise side of things as well, where we think it makes sense from a value perspective, and we'll continue to do that this year just as we have in prior years, but I wanted to take just a couple of moments you also just to address some of the movement that we've seen in the market in general over the course of the last few days.

Daniel Lynch: I mean, we're expecting growth rates to be pretty similar as we think about the guide. In early quarters, Q1 especially, where we're coming off of a really good seasonal quarter in Q4, expect PSR growth rates to be a little bit lower than where we are on subscription. But overall, for the year, we expect it to be relatively balanced. Okay, perfect.

I typically don't like to address specific competitors on these calls.

But shopify just raised there plus pricing by enormous amounts and that decision affects the entire industry in a really material way they increase their shopify plus variable fee by an incredible 60%. There are fixed monthly fee by 25% may even increase the extra payments transaction fees that they used to pressure customers into shopify.

Koji Ikeda: Thanks, guys. The next question will come from Koji Ikeda with Bank of America. Please go ahead.

Koji Ikeda: Yeah, hey guys, thanks for taking the questions. I wanted to ask about margin expansion. So when looking at the guidance, it's about five points of margin expansion for less than 10% growth in 2024. Is this the right way to think about a framework for margin expansion over the medium term? And then, you know, how should we be thinking about the bridge between potentially slowing down margin expansion in the future to drive higher growth? How long could that bridge last?

<unk> by 33%. They also institute and they think an 18 basis point additional fee on BTB transactions. I mean again. These are just enormous price increases for customers with thin margins, especially in an uncertain economic climate now I just want to be clear about this big commerce does not impose variable transaction fees like this we don't impose payments transaction.

Fees, we don't impose a b to b transaction fee and our fixed monthly enterprise subscriptions or negotiated based on customer size, including at levels far below $2500 a month.

Daniel Lynch: Great question, Koji. I would say, at least as we're thinking about going into the first half of the year, I think that's reasonable and is reflected in the guide. What Brent and I really wanted to get across in the prepared remarks is how we're thinking about this year. In 2023, we are really, really, really focused on executing a transformation with respect to profitability and with respect to cash flow. That comes with a cost, and we said going into the year that if we had to sacrifice a couple of points of growth in order to get an outsized change to what we were doing from a cash flow and a profitability perspective, we would do that. However, I do not believe that we overcorrected.

Just to be really clear, we think shopify plus's priced itself out uncompetitive levels when compared to the ecommerce and we think we have far more true enterprise functionality like multi storefront and b to be at more competitive prices and we think that shopify plus customers ought to be looking carefully at what these price increases mean and also specifically what they're being charged for and.

We're here to help those brands and again, we take pricing as well this isn't about pricing, it's more about what that means to the market and specifically, what we think customers being charged for.

Thank you so much for taking the questions.

The next question will come from Terry Tillman with Truest. Please go ahead.

Great. Good morning, guys Scot petrella on for Terry I. Appreciate you taking the question just one for me.

You focus on cross sell into this year and growing spend from existing customers.

Daniel Lynch: That said, we definitely want the focus in 2024, and this is clear throughout the organization, to be on accelerating top-line momentum in an efficient way. And going into the year, we're taking a little bit of a conservative view, which we think is prudent given market conditions, and I think that's reflected in the guidance. But we're wanting to make bets. We think we are in a really, really good position to really build on the financial situation that we're in, which is very, very good, and start getting top-line growth rates where we expect them to be, where our investors expect them to be, and we think that we can definitely do that. I got it.

Pacific products are resonating well within your merchant base and how do you kind of see that progressing throughout throughout the year. Thanks guys.

Speed and Omics, which is our Omnichannel subsidiary is an extraordinary lead asset for us in cross sell and for those who are unfamiliar fee dynamics is the leading enterprise solution globally.

To help brands optimize their omnichannel products seeds into all leading AD channels like Google shopping ads and listings the search engines, the social networks affiliates, but also more than 200 marketplace channels from Amazon Walmart target to.

Koji Ikeda: Thank you, Daniel. And as a follow-up, here, I wanted to ask about the price increase that occurred last year. So I realize it was announced about a year ago and began to roll through the customer base around June 1st. I do understand the monthly versus annual discount mechanics. So just wanted to hear some commentary on how much contribution there could be from the monthly customer price increase that's embedded in the guidance. I guess it's specifically around as a tailwind for the first half.

All the department stores that you know of.

On average it helps merchants boost their traffic and sales conversion through the advertising and marketplace channels. They used by about 20% or alternatively improve their return on AD spend by an average of about 20%.

Daniel Lynch: Yeah, let me elaborate on that. Let me speak to the question specifically, and then maybe just address pricing philosophically, just a little bit in general, because there's been a lot going on in our industry about this over the course of the last several months. Honestly, even the last several days.

And it's relevant every one of our customers. It's also relevant to businesses that are on custom or alternative E. Commerce platforms. So it is an amazing business Amazing service and an amazing cross sell up next we have more than a thousand.

Daniel Lynch: So with respect specifically to the pricing action that we took last year on small business plans, we have that tailwind baked into the guidance that affected primarily small business customers. We really have been encouraging small business customers to not go up in price, honestly, but rather just to focus on annual prepay. We think that that creates some stability for them as they look at the invoices they get. It's also more stable for us, obviously, as we plan the business, and it's better for us from a working capital point of view. We also take pricing from time to time on the enterprise side of things as well, where we think it makes sense from a value perspective. And we'll continue to do that this year, just as we have in previous years.

Technology partners, and our apps marketplace, but our payments partners shipping partners content management and search partners are particularly outstanding.

Cross sell more.

Motions for us it's their product that we are recommending but.

In most cases, we get healthy Rev share from doing so and it's always in our <unk>.

Customers best interest to help them get on the partner solutions that are best for their businesses.

Looking forward, we have a bunch of other cross sell products, but I am extremely excited about.

Daniel Lynch: But I want to take just a couple of moments here also to address some of the movement that we've seen in the market in general over the course of the last few days. Look, I typically don't like to address specific competitors on these calls, but Shopify just raised their plus pricing by enormous amounts. And that decision affects the entire industry in a really material way. They increased their Shopify plus variable fee by an incredible 60 percent, their fixed monthly fee by 25 percent, and they even increased the extra payments transaction fees that they used to pressure customers into using Shopify payments by 33 percent.

Make swift and make Swift as announced last quarter is our vision.

Visual editing as our new visual editor, it's the world's best for businesses, who are running their websites on next J S has multiuser editing publishing permissions workflows.

And as we do.

Get ever more customers that are using our catalyst technology stack for compose a bolt builds.

Think make swift is going to be an extraordinarily powerful optional visual editor for them to walk out. So those are the ones I would highlight.

Yeah.

Great. Thanks, Brent.

The next question will come from Scott Berg with Needham <unk> Company. Please go ahead.

Daniel Lynch: They also instituted, I think, an 18 basis point additional fee on B2B transactions. I mean, again, these are just enormous price increases for customers within margins, especially in an uncertain economic climate. Now, I just want to be clear about this. Big commerce does not impose variable transaction fees like this. We don't impose payment transaction fees.

Yes.

Obviously raw material, we hear the answer Scott burgers for taking the question. When you look at twice when you create can you discuss the contribution that came from agency partners for the year and what you're expecting into 2024.

Yeah, we had a good year actually with agency partners in 2023 like we did in several channels agency partners, both systems integrators and performance marketing agencies are really a critical channel for us.

Daniel Lynch: We don't impose a B2B transaction fee, and our fixed monthly enterprise subscriptions are negotiated based on customer size, including at levels far below $2,500 a month. Just to be really clear, we think Shopify plus has priced itself at uncompetitive levels when compared to big commerce. We think we have far more true enterprise functionality like multi-storefront and B2B at more competitive prices, and we think that Shopify plus customers ought to be looking carefully at what these price increases mean and also specifically what they're being charged for. And we're here to help those brands, and again, you know, we take pricing as well. But this isn't about pricing.

As a kind of partner agnostic best of breed open platform the relationships that we cultivate both with agencies and technology partners is really core to how to how we go to market. We really think of ourselves kind of is.

At the forefront of going to market for the ecosystem and our kind of partner agnostic way, which I think really resonates with tech partners and also with agencies, we're going to continue to focus on that as well.

One of our if not our most important channels as we think about how we're going to be growing on the year.

That will have just as much important importance going into 2024 as well we have several different partner programs that we have whether it's for the platform product.

The fee dynamics product as well, where we really focus on building that out it's been a very successful channel for us and we anticipate it will continue to be so.

Daniel Lynch: It's more about, you know, what that means to the market and specifically what we think customers are being charged for. Thank you so much for taking the question. The next question will come from Terry Tillman with Truist. Please go ahead. Great morning, guys. Connor and Pats are all on for Terry. Appreciate you taking the question. Just one question for me.

Got it appreciate that color and it sounds like you guys had a strong performance from our <unk>.

<unk> still seeing somebody walking at sales cycles.

Any specific industries or verticals, where you see strength or weakness weakness as of late.

I'd say, it's pretty broad based in terms of I don't think there's any one particular industry or vertical where that is really more of an issue with others. We're seeing good momentum in a lot of different industries and a lot of different sectors.

Terry Tillman: With the continued focus on cross-sell this year and growing spend from existing customers, what specific products are responding well within your merchant base, and how do you kind of see that progressing throughout the year? Thanks, guys. Feedonomics, which is our omni-channel subsidiary, is an extraordinary lead asset for us in CrossSell. And for those who are unfamiliar, Feedonomics is the leading enterprise solution globally to help brands optimize their omni-channel product feeds into all leading ad channels, like Google Shopping ads and listings, the search engines, the social networks, affiliates, but also more than 200 marketplace channels, from Amazon, Walmart, Target, to all the department stores that On average, it helps merchants boost their traffic and sales conversion through the advertising and marketplace channels they use by about 20% or, alternatively, improve their return on ad spend by an average of about 20%, and it's relevant to every one of our customers. It's also relevant to businesses that are on custom or alternative e-commerce platforms. So it's an amazing business, an amazing service, and an amazing cross-sell. Up next, we have more than a thousand technology partners in our apps marketplace, but our payments partners, shipping partners, content management, and search partners are particularly outstanding cross-sell. Motions for us.

I just think in general there is still quite a bit of caution when it comes to platform investment, which makes sense, we're being really disciplined about what we are spending as well and looking to reduce costs and we're seeing the same behavior of customers, what I really want to call out and differentiate big commerce on we're trying to work with our customers and make sure what their spending with us is transparent and easy to understand.

It's matching the needs of their business and that we're also being acutely sensitive to the type of economic pressures that they're facing as well I think it's important that as being a customer first company to continue to do that.

Also it makes sense, thanks for taking the questions.

The next question will come from DJ Hynes with Canaccord. Please go ahead.

Hey, good morning, guys.

So Brian just looking at Geo performance.

What do you think is resonating in international markets that maybe isn't as well in the U S.

I don't know dynamics something about the go to market approach any color there would be interesting.

Well one of the real strengths of our platform that resonates very highlight for business is based outside the U S and EMEA or APAC is our multi storefront and multi geo capabilities and.

And also a second pillar of that is are composed of both capabilities because.

Brent Bellum: It's their product that we are recommending, but in most cases, we get a healthy revenue share from doing so, and it's always in our customers' best interest to help them get on the partner solutions that are best for their business. Looking forward, we have a bunch of other cross-sell products, but I am extremely excited about... MakeSwift. And MakeSwift, as announced last quarter, is our new visual editor. It's the world's best for businesses who are running their websites on Next.js. It has multi-user editing, publishing, and permissions workflows, and as we get more customers that are using our Catalyst technology stack for composable builds, we think MakeSwift is going to be an extraordinarily powerful, optional visual editor for them to look at.

If you are a business for example, based in Europe, you're going to have to sell into multiple <unk>.

Currencies languages.

Even trading blocks and.

Having true enterprise multi storefront capabilities, which only the enterprise platforms like us have it.

Is essential for those companies and it's less essential for businesses here in North America, who might only be focused on the U S and Canada and not need all of that multi storefront multi geo capabilities and because of the importance of that compose the ball is particularly valuable.

Valuable as an option, especially in EMEA.

Brent Bellum: So those are the ones I would highlight. Great. Thanks, Brent. The next question will come from Scott Berg with Needham & Company. Please go ahead.

So we're really bullish on catalysts being our next generation Composedly storefront reference architecture, we think that's going to help us.

Scott Berg: Hi, this is Ron Morelli here. I'm from Scott Berg. Thanks for taking the question. When you look at 2023, can you discuss the contribution that came from agency partners for the year and then, you know, what you're expecting as of 2024? Yeah, we had a good year with agency partners in 2023, like we did in several channels. Agency partners, both systems integrators and performance marketing agencies, are really a critical channel for us.

Further improve our competitive advantage outside of the U S. But also for the first time make composer Bowl approachable for brands in the U S.

And I would highlight this because historically anybody on the Mach Alliance.

And tell you that.

The U S and Canada have been slower adopters of <unk>. The reason is partly because they haven't had to do it in most cases out of necessity like they have in EMEA.

And the burden of adopting composer Bowl.

<unk> has been historically high because you.

Daniel Lynch: As a kind of partner-agnostic, best of breed, open platform, the relationships that we cultivate both with agencies and technology partners are really core to how we go to market. We really think of ourselves kind of... at the forefront of going to market for the ecosystem in a kind of partner-agnostic way, which I think really resonates with tech partners and also with agencies. We're going to continue to focus on that as one of our, if not our most important channels, as we think about how we're going to be growing this year. That will have just as much importance going into 2024 as well.

Have a different front end than you do backend platform you have to stitch together the various components of your tech stack hosting content management search et cetera, and what's revolutionary about our catalyst approach is it's an out of the box referenced architecture that business compressed.

Button and literally in under 60 seconds have.

A sandbox storefront up and running with the best Tech in the World next J S react.

For sell hosting a choice of multiple market, leading content management systems choice of multiple market, leading search and merch engines and have Google out of the box lighthouse scores of 100.

Daniel Lynch: We have several different partner programs that we have, whether it's for the platform product or for the feedonomics product as well, where we really focus on building that out. It's been a very successful channel for us, and we anticipate it will continue to be so.

Is an extraordinary change in just how approachable and easy to implement composed bullish with the most popular and highest performing technologies in the world and so it's our hope that we're actually bringing some of our strongest <unk>.

Daniel Lynch: And it sounds like you guys had strong performances, you know, from all your key regions, still seeing so many long sales cycles. Any specific industries or verticals where you see, you know, strength or weakness as of late? I'd say it's pretty broad-based in terms of, I don't think there's any one particular industry or vertical where that is really more of an issue with others. We're seeing good momentum in a lot of different industries and a lot of different sectors. I just think, in general, there's still quite a bit of caution when it comes to platform investment, which makes sense.

Industry, leading capabilities from outside the U S now to something that American companies, who really want to lead with best of breed user experience and best of breed site performance and the market leading tech stacks that developers love to work at next Jassen react, we're bringing Matt now to North America.

<unk> had a usability price point and scalability way that has never existed before and that's why we and so many agency partners are extremely bullish about catalyst. So I'm emphasizing set of competitive advantages and multi storefront multi geo and composer Bowl.

Daniel Lynch: We're being really disciplined about what we are spending as well and looking to reduce costs, and we're seeing the same behavior with customers. What I really want to call out and differentiate BigCommerce on is that we're trying to work with our customers and make sure that what they're spending with us is transparent, it's easy to understand, it's matching the needs of their business, and that we're also being acute and sensitive to the type of economic pressures that they're facing as well. I think it's important, as a customer-first company, to continue to do that. It was awesome.

That have really helped us outside the U S.

Emphasizing that we're now bringing that and the best ever way to North America, and we really hope that accelerates the adoption of <unk> and Mark approaches when those make sense for a given business.

David E. Hynes: Thanks for taking the question. The next question will come from DJ Hynes with Canaccord, please go ahead. Hey, good morning, guys.

That's very clear and helpful color.

Brent Bellum: So Brent, just looking at geo performance. What do you think is responding in international markets that maybe isn't as well in the U.S.? Is it, I don't know, dynamics, something about the go-to-market approach? Any color there would be interesting.

Daniel maybe transitioning to you. So you talked about wanting to get growth rates after where both investor than you guys expect them to be what is that growth rate at this point, where do you think big commerce can get back to.

I think it's still consistent with what we talked about in our last Investor Day, which is I think this is a business that can and should be growing over time at 20% plus growth rates with a balanced profile at or above our rule of 40, we just need time to get there I think if we look at where we've been over the course of the last year.

Brent Bellum: Well, one of the real strengths of our platform that resonates very highly for businesses based outside the US and EMEA or APAC is our multi-storefront and multi-geographic capabilities. And also, a second pillar of that is our composable capabilities because, if you are a business, for example, based in Europe, you're going to have to sell into multiple currencies, languages, you know, even trading blocks, and having true enterprise multi-storefront capabilities, which, you know, only enterprise platforms like us have, is essential for those companies. And it's less essential for businesses here in North America who might only be focused on the U.S. and Canada and not need all of that multi-storefront, multi-geo capabilities.

I mean, we're in.

Hardly the only small cap company that needed to make a pivot from a profit perspective as interest rates started to move in 2022.

Brent Bellum: And because of the importance of that, Composable is particularly valuable as an option, especially in EMEA. And, you know, we're really bullish on Catalyst being our next-generation composable storefront reference architecture. We think that's going to help us further improve our competitive advantage outside of the U.S. but also, for the first time, make Composable approachable for brands in the U.S. And I would highlight this because, historically, anybody in the mock alliance would tell you that... The U.S. and Canada have been slower adopters of Composable.

Brent Bellum: The reason is partly because they haven't had to do it, in most cases, out of necessity, like they have in EMEA. And the burden of adopting Composable, has been historically high because you have a different front end than you do back end platform, you have to stitch together the various components of your tech stack, hosting, content management, search, etc. And what's revolutionary about our catalyst approach is it's an out-of-the-box reference architecture that a business can press a button and literally in under 60 seconds have a sandbox storefront up and running with the best tech in the world, Next.js, React, Vercel hosting, choice of multiple market-leading content management systems, choice of multiple market-leading search and merge engines, and have Google out-of-the-box Lighthouse scores of 100.

Queenstown with Barclays. Please go ahead.

Thank you thanks for squeezing me in.

Quick question for me, it's like if I, if I think P. As our revenue is better at the moment and I'm Gonna just talked about like consumer getting better like how do you think this will translate into the investment decisions on the corporate side or on the on the on your real customer site and do you see do they need like a few quarters of.

Consumer spending and then they Ah confidence increases and then eventually they start thinking about a high investment levels and then you will see it or how do you think that that plays out as we kind of go through the year. Thank you.

Brent Bellum: It is an extraordinary change in just how approachable and easy to implement Composable is compared to the most popular and highest performing technologies in the world. And so it's our hope that we're actually bringing some of our strongest industry-leading capabilities from outside the U.S. now to something that American companies who really want to lead with best-of-breed user experience and best-of-breed site performance and the market-leading tech stacks that developers love to work in, Next.js and React, we're bringing that now to North America at a usability price point And that's why we and so many agency partners are extremely bullish about Catalyst. So I'm emphasizing a set of competitive advantages in multi-storefront, multi-geo, and composable that have really helped us outside the U.S. and emphasizing that we're now bringing that in the best way ever to North America, and we really hope that accelerates the adoption of composable and mock approaches when those make sense for a given business. Yeah, a very clear and helpful color. Daniel, maybe I should transition to you.

That's a good question and part of the reason why in my prepared remarks, I called out that we really see two different area map areas of macroeconomic impact is because consumers that is a really really really good leading indicator, but it's not always the only leading indicator obviously business investment sense and that is just as important to our business. When we have where you know.

Booking rupture on a net basis and so you know it's it's different for us in terms of total predicted for revenue I think that if we continue to see resilience in consumer spending I think that is going to translate into more positive Ah just sentiment in general on a macroeconomic basis, which I think will also pull through where we will see business investment as well in time.

And what we're seeing right now is it there's there's good news and there's you know some headwinds that we're dealing with I think like a lot of other companies were seeing customers really really focused on making sure. They're long term investments in e-commerce are really short up because that's continues to be a major growth area. But there are also wanting to make sure that they've got the spending right sides in a way that makes sense with where the businesses.

Daniel Lynch: So you talked about wanting to get growth rates back to where both investors and you guys expect them to be. What is that growth rate at this point? Where do you think BigCommerce can get back to? I think it's still consistent with what we talked about in our last investor day, which is that I think this is a business that can and should be growing over time at 20% plus growth rates with a balanced profile at or above a rule of 40. We just need time to get there.

Today and for the volumes that they're seeing with consumer spending today and then I think they're also looking at her.

How does the pricing structure look as it straightforward are they paying a straightforward price where they know what they're getting or are they paying a two three or four part pricing scheme, where the actual effective price looks very different than the land price. When they are signing on with a customer and we're getting a lot of questions about that which is part of why I'm being very explicit in calling this out because I think it really merits looking at so.

Daniel Lynch: I think if we look at where we've been over the course of the last year, I mean, we're hardly the only small cap company that needed to make a pivot from a profit perspective as interest rates started to move in 2022. I think that the progress we've made is really, really notable, but I want to be really clear. We're not stopping there and are satisfied with that.

We're really focused on you know we're focused on taking care of our customers I'm confident as consumer spending stays resilient. This is going to provide tailwinds and it's gonna be good for the business.

And then the second question I had was if you think about the.

Capacity or the capacity out there obviously as things get better you kind of need to think about pre investing a little bit because it takes a little bit of time to get people on Britain. So where are you at the moment in terms of productivity and buffer did you happen to hear vs kind of investing into one squirrel started picking up again. Thank you.

Daniel Lynch: This is a growth business, and we really are excited about where we can go. I think we talked about on our call last quarter how we were thinking about this year, trying to set internal plans in high single to low double digits. That's still how we're thinking about the year.

We have more than enough sales capacity for the internal targets that we have setup I feel confident about that we also have a really really good ramp times with new reps as growth starts to pick up or I'm really confident that we can add capacity and it will not be a barrier to our growth.

Daniel Lynch: We're opening the year, trying to be a little bit conservative as we think about that, but we view this as a year we really, really want to see successful adoption of a tried and true successful B2B go-to-market program that we've really started to execute that we're excited about. I think that that can lead to a much more balanced growth profile in the future that's much more cost effective than being so logo-reliant like we've been in recent years. I think as we really move into that tried and true best in class model, that's going to get us towards those long-term growth rates which we feel we have every right to be in and which we know our investors expect. It makes sense. I appreciate the help, guys.

Perfect. Thank you call them for me as well.

The next question will come from Parker Lane with stifle. Please go ahead.

Hi, Thanks for taking my questions and congrats on the tremendous progress here Oh, It's curious Brent if you could talk a little bit about the demand Jen between your internal go to market teams and partner led motions.

There's a lot of <unk>.

Restructuring upwards around go to market and things that you were emphasizing more now but with the emergence of that partner Chantal how much of the business is being driven by those two components.

Ramo Linchtau: Thank you. The next question will come from Ramo Linchtau of Barclays. Please go ahead.

Daniel Lynch: Okay. Thank you. The quick question for me is, if I think PSR revenue is better at the moment, and Daniel talked about consumers getting better, how do you think this will translate into investment decisions on the corporate side or on your real customer side? Do you see, do they need a few quarters of better consumer spending before their confidence increases, and then eventually they start thinking about high investment levels, and then you will see it? How do you think that plays out as we kind of go through the year? Thank you. That's a good question.

For our enterprise plans, which are of course more than 70% of our total a R. R partners have overtime driven between 35 and 40% of the top a funnel lead flow.

That ends up converting.

You know, it's probably running closer to 40% right now our agency partners in technology partners are really tremendous at working with us and helping us go to market and when business together.

Daniel Lynch: Part of the reason why, in my prepared remarks, I called out that we really see two different areas of macroeconomic impact is because consumer spend is a really, really, really good leading indicator, but it's not always the only leading indicator. Obviously, business investment sentiment is just as important to our business. When we have, we're booking rev share on a net basis, and so it's different for us in terms of the total predictor for revenue. I think that if we continue to see resilience in consumer spending, I think that is going to translate into more positive sentiment in general on a macroeconomic basis, which I think will also pull through as we see business investment as well in time. What we're seeing right now is that there is good news, and there are some headwinds that we're dealing with.

What is incremental now to our go to market motions or improvements in the way, we outbound crossback whether it is in our sales development rap channel or it is in with our enterprise a he's there is an incremental amount of outbound hunting that we are doing.

<unk> I think rather successfully and then finally I'd emphasize our events focus we are really showing up at quality events with a quality presents and looking to get whether it's you know.

Category or vertical specific events or general ecommerce industry events, we're showing up with a strong.

Daniel Lynch: I think, like a lot of other companies, we're seeing customers really, really focused on making sure their long-term investments in e-commerce are really shored up because that continues to be a major growth area, but they're also wanting to make sure that they've got the right size of spending in a way that makes sense with where the business is at today and for the volumes that they're seeing with consumer spending today. And then I think they're also looking at how the pricing structure looks. Is it straightforward?

Commerce present strong partner presence and.

Trying to prospect as effectively as possible in those areas and we see great returns from those channels.

Got it very helpful. And then I know, it's early but you announced or disclose a bunch of different advancements over the last couple of quarters here I would love to hear your thoughts on how you think that transforms the e-commerce landscape and how it translates directly to merchant growth and success over time.

Daniel Lynch: Are they paying a straightforward price where they know what they're getting, or are they paying a two, three, or four-part pricing scheme where the actual effective price looks very different from the landed price when they're signing on with a customer? We're getting a lot of questions about that, which is part of why I'm being very explicit in calling this out because I think it really merits looking at. So we're really focused on taking care of our customers. I'm confident that as consumer spending stays resilient, this is going to provide tailwinds, and it's going to be good for the business. Yeah, and then the second question I had was, if you think about the sales capacity or the capacity out there, obviously, as things get better, you kind of need to think about pre-investing a little bit because it takes a little bit of time to get people up and running.

I've said in the past that I think our feet Anomic subsidiary has arguably.

Already the best AI engine in the world of e-commerce why because they're feed a I <unk>.

Is extraordinarily powerful and optimize for taking a merchant's proud.

Product catalog and then transforming it to perform through the Google schema, a typical business has.

Out of the box only about a 60% match rate and.

Words for performance and the Google schema and Theta AI.

Daniel Lynch: So where are you at the moment in terms of productivity and buffer that you have in there versus kind of investing into once growth starts picking up again? We have more than enough sales capacity for the internal targets that we have set up. I feel confident about that. We also have really, really good ramp times with new reps. As growth starts to pick up, I'm really confident that we can add capacity, and it will not be a barrier to our growth. Thank you. The next question will come from Parker Lane with Stifle. Please go ahead.

Automatically will get that over 95 per cent and then sort of human movement and intervention will get from 95 to 100, what that does though isn't let's a business perform.

Optimally through Google shopping, Google ads and listings in Google and search in General is you know on average we see with our customers something like 35 to 40 per cent of their last click source of G. M. P. It's an extraordinarily big channel and see dynamics is the best AI and the world dropped.

Parker Lane: Hi guys, thanks for taking the questions and congrats on the tremendous progress here. I was curious, Brent, if you could talk a little bit about the demand generation between your internal go-to-market teams and partner-led movements. There's a lot of restructuring efforts around go-to-market and things that you're emphasizing more now, but with the emergence of that partner channel, how much of the business is being driven by those two components? For our enterprise plans, which are, of course, more than 70% of our total ARR, partners have, over time, driven between 35% and 40% of the top-of-funnel lead flow that ends up converting And, you know, it's probably running closer to 40% right now.

Rising that and by the way most other add channels social network search engines affiliates display ads.

Kind of utilize the Google scheme, not perfectly, but once you optimize using feet and Omics for Google you were 80 90 per cent of the way there to being able to add and perform optimally do any other advertising channel.

There's nothing else that is going to boost the top line bigger than that that I know of on top of that I mean, just to be very quick or.

Other some of our products are already lied and that includes both how we're using AI to better serve customers through chat and give them better answers directly.

A I for creating product listings and content around that we've announced partnership with Google around product recommendations that we're really excited about and have seen great testing results.

Brent Bellum: Our agency partners and technology partners are really tremendous at working with us and helping us go-to-market and win business together. What is incremental now to our go-to-market efforts are improvements in the way we outbound prospect, whether it is in our sales development rep channel or it is with, you know, our enterprise AEs. There is an incremental amount of outbound hunting that we are doing, I think, rather successfully. And then, finally, I'd emphasize our events focus.

A few other things and then there are already dozens of very good AI products live in our App marketplace. So.

There was widespread impact across all of those but I always liked to anchor on what's the dynamics can do four.

Add channel performance really starting with Google.

Brent Bellum: We are really showing up at quality events with a quality presence and looking to get, whether it's, you know, category or vertical-specific events or general e-commerce industry events, we're showing up with a strong BigCommerce presence, strong partner presence, and, you know, trying to prospect as effectively as possible in those areas. And we see great returns from those channels.

Very interesting like spring.

The next question will come from some onto mono with Jeffries. Please go ahead.

Hey, guys. Thanks for taking my questions. This is Jeremy style around for some odd. So last what are you guys called that some customer launches being delayed until after the holiday I guess can you provide an update on whether all of these are closed and what the impact was on the corner and then you mentioned in your prepared remarks of the sales cycle remains lengthened are there any new deals that you expect you to close this quarter that are being pushed out further.

Well in terms of launch one really big customer is launching right now in fact, I've already done transactions on them and we're very excited about that.

Brent Bellum: Very helpful. And then, I know it's early, but you announced or disclosed a bunch of different AI advancements over the last couple of quarters here. I would love to hear your thoughts on how you think that transforms the e-commerce landscape and how it translates directly to merchant growth and success over time. I've said in the past that I think our Fedonomics subsidiary is, arguably, already the best AI engine in the world of e-commerce. Why?

We had a good quarter for enterprise launches in Q4, we'll start to see you know that G. M. D ramp this year and then in terms of sales cycles. It's I think a continuation of the story of last year, they're just longer than they were before 2022.

Brent Bellum: Because their Feed.ai is extraordinarily powerful and optimized for taking a merchant's Product Catalog and then transforming it to perform through the Google schema. You know, a typical business has, out-of-the-box, only about a 60% match rate in words for performance in the Google schema. And Feed.ai automatically will get that to over 95%.

[noise] happened a lot faster well, especially during the pandemic, but pre pandemic sale.

Sales cycles were shorter there longer now and it's just a reality that we're living in until and unless the economy changes.

Alright, let's do some color and then I guess you ship. This new like minded extends heavy model I guess, how are you thinking about N. R. R. For 2024 is a room for that to move you know how much room for that to move above 100.

I think there's room for it to move above 100, but going into the year. Our outlook is kind of based on the expectation that 2024, it's gonna look pretty similar to 2023.

Brent Bellum: And then sort of human movement and intervention will get from 95 to 100. What that does, though, is it lets a business perform optimally through Google Shopping, Google Ads, and Listings, and Google and search in general. On average, we see with our customers something like 35 to 40 percent of their last click source of GMV. It's an extraordinarily big channel, and Feedonomics is the best AI in the world for optimizing that. And by the way, most other ad channels, social networks, search engines, affiliates, display ads, kind of utilize the Google schema. Not perfectly, but once you optimize using Feedonomics for Google, you are 80-90% of the way to being able to add and perform optimally through any other advertising channel.

Is that all.

All of the emotions that we are taking on the go to market side are specifically geared towards addressing that number because we think it is almost if not the best it's one of the best long term indicators of growth and Ah any sass business. So that's the clear area of focus for us just to be clear about how we're thinking about the year. However, we're building our plans assuming the 2024, it's gonna look a lot like 2023 in that respect.

And we're taking decisive action in order to control our own destiny and improve that number.

Got it thanks for taking my questions guys.

The next question will come from Mattie Screeched with Keybanc. Please go ahead.

Hey, guys. Good morning, and thanks for taking the questions. My first one for you is I'm just wondering if there's any early learnings from January and February consumer trends and then my second one is I'm. Just wondering if you could talk a bit about the level of fee to be penetration that you've made so far and maybe how much it's gonna <unk>.

Brent Bellum: There's nothing else that's going to boost the top line bigger than that, that I know of. On top of that, I mean, just to be very quick, some of our ARA products are already live, and that includes both how we're using AI to better serve customers through chat and give them better answers directly, and AI for creating product listings and content around that. We've announced a partnership with Google around product recommendations that we're really excited about and have seen great testing results. A few other things, and then there are already dozens of very good AI products live in our apps marketplace. So there's widespread impact across all of those, but I always like to anchor on what Feedonomics can do for ad channel performance, really starting with Google. Very interesting. Thanks, Brent. The next question will come from Saman Samana with Jeffreys. Please go ahead. Hey guys, thanks for taking my questions. This is Jeremy Salaran from Sumad.

Reviewed in 2024.

Yeah I can address the first by briefly and then Brent will take the question would be to be January and February I'd say, so so far so good there's been obviously differences seasonally which is normal which is in line with what we would have expected what we've seen so far is in line with where we set the guidance.

Yeah, Onbeat or B.

I am so bullish on where we are and where we're going there remember we didn't even have a native vdb product three or four years ago. We then started with a partner product that we white labeled we bought that product, but what's most compelling now is that our beta be buyer portal has been dull inside of commerce from the.

Saman Samana: So last quarter, you guys called out some customer launches being delayed until after the holiday. Can you provide an update on whether all of these have closed and what the impact was on the quarter? And then you mentioned in your prepared remarks that the sales cycle remains lengthened. Are there any new deals that you expect to close this quarter that are being pushed out further? Well, in terms of launches, one really big customer is launching right now. In fact, I've already done transactions with them, and we're very excited about that. We had a good quarter for enterprise launches in Q4. We'll start to see that GMV ramp this year. And then in terms of sales cycles, it's, I think, a continuation of the story of last year. They're just longer than they were before 2022. They happened a lot faster.

Ground up it is the best user experience and most powerful buyer portal, we believe in all of the commerce.

And the pace of innovation that we're rolling out.

Just in the last quarter invoicing capabilities credit management capabilities.

We think that we can and will be over time, the world's leading BTB platform or penetration today and beaten B is minimus and so this was largely upside it's a high percentage of our sales mix in fact, our general sales mix B C versus B b as.

I think roughly in line with global platform spend between the two and again for a company that for its first 10 12 years was be to see only to now be competing as successfully proportionately in both categories. I think is a great Testament to the work or be to be teams.

Brent Bellum: Well, especially during the pandemic, but before the pandemic, sales cycles were shorter; they're longer now, and it's just a reality that we're living in until and unless the economy changes. That's a useful color.

Have pulled off in the last couple of years.

Momentum is very big and.

Daniel Lynch: And then, I guess, as you shift to this new, like, landed, expands, heavy model, I guess, how are you thinking about NRR for 2024? Is there room for that to move? You know, how much room is there for that to move above 100? I think there's room for it to move above 100, but going into the year, our outlook is kind of based on an expectation that 2024 is going to look pretty similar to 2023. All of the actions that we are taking on the go-to-market side are specifically geared towards addressing that number because we think it is almost, if not the best, one of the best long-term indicators of growth in any SaaS business. So that's a clear area of focus for us. Just to be clear about how we're thinking about the year, however, we're building our plans assuming that 2024 is going to look a lot like 2023 in that respect, and we're taking decisive action in order to control our own destiny and improve it.

You know I I I really hope, we do earn our way there to being the world's largest and best BTB platform. One small thing I would add on top of that as well our BTB customers are really excited about the possibility that the commerce offers them to pull all of their online and offline orders and together on one platform and we're not sure.

Barging transaction fees on offline orders when they are brought into our platform because we're very much a lining the way we're going to market with what our customers are trying to accomplish and I think that's a differentiator for us and something that's really really been resonating powerfully with our B b customers.

I appreciate the color thanks, guys.

The next question will come from Matt Powell with William Blair. Please go ahead.

[noise] Hey, Great just just one for me in terms of the guidance for 2024, just wondering how you were thinking about the split and gross between the retail and enterprise account segments busy cause if I remember correctly relative to where you were originally expecting twenty-three to come in I think retail was a bit better enterprise a bit weaker than you.

Daniel Lynch: Thanks for taking my questions, guys. The next question will come from Maddie Scrage with KeyBank. Please go ahead.

Expected. So just wondering how you were thinking about that trend into 2024.

Maddie Scrage: Hey guys, good morning and thanks for taking the questions. My first one for you is, I'm just wondering if there are any early learnings from January and February consumer trends. And then my second question is, I'm just wondering if you could talk a bit about the level of B2B penetration that you've made so far and maybe how much it's going to contribute in 2024. Thanks. Yeah, I can adjust the first part briefly, and then Brent will take a question on B2B. January and February, I'd say so far, so good.

Yeah. Good question, we're expecting growth rates in the non enterprise portion of the business to be a little bit lower than where the enterprise would be where we're focusing our go to market resources and dollars remains on the enterprise side, where we see better long term economic tire LTV tack, but we're not ignoring our small business customers and we're not ignoring that part of our business I think it's just one that.

Where very much kind of thinking more about that as more of a self serve less sales generated heavy emotion just to make sure that the economic stay efficient and we're focusing on our ideal customer profiles, which are established small businesses. You know doing hundreds of thousands of dollars a year in the low single digit millions in terms of G. M V. Once you get above.

Daniel Lynch: There were obviously differences seasonally, which is normal, which is in line with what we would have expected. What we've seen so far is in line with where we set the guide. Yeah, on B2B. I am so bullish on where we are and where we're going there. Remember, we didn't even have a native B2B product three, four years ago. We then started with a partner product that we white-labeled.

That I think you know we can we have an enterprise plans that we can price competitively even for those businesses that are you know a thousand dollars around there a little bit more a month. So we're still focus on that part of the business I'd like to see a stable across the year and then gradually starting to grow potentially as we exit the ear, but really really laser focused on acceleration on the enterprise portion of.

Brent Bellum: We bought that product, but what's most compelling now is that our B2B buyer portal has been built inside of BigCommerce from the ground up. It is the best user experience and the most powerful buyer portal, we believe, in all of e-commerce. The pace of innovation that we are rolling out, just in the last quarter, invoicing capabilities, and credit management capabilities. We think that we can and will be, over time, the world's leading B2B platform. Our penetration today in B2B is de minimis, and so this is largely upside. It's a high percentage of our sales mix. In fact, our general sales mix, B2C versus B2B, is, I think, roughly in line with global platform spend between the two.

They are.

Perfect I appreciate it.

The next question will come from Josh Bear with Morgan Stanley. Please go ahead.

Thanks for the question and congrats on the strong profitability well I was hoping you could give us some more context for the 100 per cent enterprise Ah net retention rate just trying to get a sense for the drop if it's more a function of this quarter versus the year ago period or if dynamics.

Daniel Lynch: And again, for a company that, for its first 10, 12 years, was B2C only, to now be competing as successfully, proportionally, in both categories, I think, is a great testament to the work our B2B teams have pulled off in the last couple of years. Momentum is very strong, and I really hope we do earn our way there to being the world's largest and best B2B platform. One small thing I would add on top of that as well. Our B2B customers are really excited about the possibility that BigCommerce offers them to pull all of their online and offline orders together on one platform. And we are not charging transaction fees on offline orders when they are brought into our platform because we're very much aligning the way we're going to market with what our customers are trying to accomplish. And I think that's a differentiator for us and something that's really, really been responding powerfully with our B2B customers. I appreciate the color.

Got worse better stayed the same from last quarter I guess, it's in regards to customer downsizing as well as sales cycles like how did these compare this quarter in Q4 verse Q3.

Great question, the number that we quote we quoted once a year. It's a simple average of what we've seen across all four quarters, we've seen similar numbers across the year, obviously at the time period that you're referring to obviously is when we saw the most downgrade pressure I would say from existing customers I think that's reflective overall in the in our our results for the.

Here that specific issue has gotten better over the course of the last quarter or two we're still seeing more kind of customer initiated downgrades, where they're wanting to call. It right size there.

Contractual order volumes to the volumes that they're seeing out of the pandemic relative to the numbers that they thought they would see in some cases when they entered into those contracts during the pandemic and as I've said, we're working with customers on that we ended up with higher price for orders were not giving the same volume discounts normal pricing negotiations as you would expect but we're seeing improving trends then.

Matthew Charles Pfau: Thanks, guys. The next question will come from Matt Pfau with William Blear. Please go ahead. Hey Greg, just one for me.

Daniel Lynch: In terms of the guidance for 2024, just wondering how you're thinking about the split and growth between the retail and enterprise account segments. Because, if I remember correctly, relative to where you were originally expecting 2023 to come in, I think retail was a bit better, and enterprise a bit weaker than you expected. So just wondering how you're thinking about that trend into 2024. Yeah, good question.

That area still elevated we're still expecting that to be a little bit higher than where it's been for us in years past as we think about 2024, but we are definitely seeing improving trends in that respect versus where we were in the 2023 like I had mentioned in my prepared remarks.

Brent Bellum: We're expecting growth rates in the non-enterprise portion of the business to be a little bit lower than where the enterprise would be. Where we're focusing our go-to-market resources and dollars remains on the enterprise side, where we see better long-term economics, higher LTVD CAC, but we are not ignoring our small business customers, and we're not ignoring that part of our business. I think it's just one that we're very much thinking more about that as more of a self-serve, less sales-generated heavy movement, just to make sure that the economics stay efficient. And we're focusing on our ideal customer profiles, which are established small businesses doing hundreds of thousands of dollars a year and the low single-digit millions in terms of GMV. Once you get above that, I think we have an enterprise plan that we can price competitively, even for those businesses that are $1,000 around there, a little bit more a month.

Great and and this metrics should rebound later in 24 room for it to go above 100 per cent, but is is 100 per cent this quarter, the floor or or could that dip further before rebounding later thanks.

I mean, it as I said, it's an average across the year there could be if if if we think that's where it's going to be kind of as a theme for the year as a whole there may be some quarters that are a little below there may be some quarters that alert with a little bit above part of this is still macro driven we need to see how the your shakes out what I'm, calling us specifically is how we're thinking about the year from has since been perspective, just so it's clear how the guide has been put in.

Together, but we still need to see how the actual your plays itself out.

Thanks.

Again, if you have a question. Please press Star then one our next question will come from Brian Peterson with Raymond James. Please go ahead.

Alright, Thanks for taking the question. This is John on for Brian Just just one from US here on international expansion clearly, it's been an area of focus for the company to expand internationally I think in the past you've mentioned more of a partner led motion, though would that expansion going forward I'm just curious given the results you've seen here internationally. If that's still the case or how you were thinking about international expansion as we move into twins.

Daniel Lynch: So we're still focused on that part of the business. I'd like to see it stable across the year and then gradually starting to grow, potentially as we exit the year, but really, really laser focused on acceleration on the enterprise portion of ARR. Perfect. Appreciate it.

Sure.

Correct and the first call at three or four years of international expansion. We were focused on major new markets, where we would lead with both our own personnel and sales marketing and partnership as well as building out a partner network in those countries. So.

Josh Bayer: The next question will come from Josh Bayer with Morgan Stanley; please go ahead. Thanks for the question and congratulations on the strong profitability. Was hoping you could give some more context for the 100% enterprise net retention rate. Just trying to get a sense for the drop if it's more a function of this quarter versus the year-ago period or if dynamics, you know, got worse, better, or stayed the same from last quarter. I guess, in regard to customer downsizing as well as sales cycles, like how did these compare this quarter in Q4 versus Q3? Great question.

<unk> going from the U K and Europe into France, Germany, Italy, Spain, Benelux Nordics.

As an example, and then what we are doing now is.

Staying strong in those major markets across EMEA, Obviously, Australia New Zealand.

U S in Mexico and Canada.

But we're not looking in last year or this year to put additional bit commerce employees on the ground in the markets, we're expanding into button instead work with partners and we're seeing very interesting partnerships developed in Japan.

Daniel Lynch: The number that we quote, we quote it once a year; it's a simple average of what we've seen across all four quarters. We've seen similar numbers across the year. Obviously, the time period that you're referring to is when we saw the most downgrade pressure, I would say, from existing customers. I think that's reflective overall in the NRR results for the year. That specific issue has gotten better over the course of the last quarter or two.

In Korea, and India, India is another tree, where we do have people on the ground and the partner networks extraordinary.

But you know if we think about South America, we think about other regions for the time being while we're focused on efficient growth, yes. It will be partner lad in these new markets rather than the commerce people lab.

Daniel Lynch: We're still seeing more kind of customer-initiated downgrades where they're wanting to call it right size their contractual order volumes to the volumes that they're seeing out of the pandemic relative to the numbers that they thought they would see in some cases when they entered into those contracts during the pandemic. And as I've said, we're working with customers on that. We end up with a higher price for orders. We're not giving the same volume discounts, or normal pricing negotiations, as you would expect. But we're seeing improving trends in that area, although still elevated.

Thanks for the question.

Thank you very much.

The next question will come from Mark Murphy with J P. Morgan. Please go ahead.

Oh, Thank you very much Ah Brant, you mentioned using AI based chatbots for our customer support and you're prepared comments I'm just curious at a high level is any of the Ah positive margin progress that you've had so far at this point attributable to efficiency gains or productive.

Video games that are stemming from that kind of internal usage of January I products, whether it be github, copilot or a customer support chatbots or or anything else or would you look at it and say that all of this was with a kind of 100 per cent unrelated to a I never.

Daniel Lynch: We're still expecting that to be a little bit higher than where it has been for us in years past, as we think about 2024. But we're definitely seeing improving trends in that respect versus where we were in mid-2023, as I had mentioned in my prepared remarks. Great, and this metric should rebound later in 24, with room for it to go above 100%. But is 100% this quarter the floor, or could that dip further before rebounding later? Thanks. I mean, as I said, it's an average across the year.

Quick follow up.

I'm not gonna say it rises to the level of major financial <unk>.

Significance, but what I would emphasize is on the customer experience side.

Two things number number one is unlike one of our biggest competitors we provide.

Daniel Lynch: There could be a, if we think that's where it's going to be, kind of as a theme for the year as a whole, there may be some quarters that are a little below, and there may be some quarters that are a little bit above. Part of this is still macro-driven. We need to see how the year shakes out, but what I'm calling out specifically is how we're thinking about the year from a sentiment perspective, just so it's clear how the guide has been put together. But we still need to see how the actual year plays itself out.

That commerce human support ourselves.

With life phone numbers for all customers globally, and we're able to do that at an efficient level, partly because we're very operationally disciplined you know many of our tier one support personnel are now down in Mexico, which we've had real success hiring in.

And on top of that the chatbot option enables many customers to come in and ask a question and get an answer and never even need to talk to a live human being and that's one of the reasons why I'm very proud of the.

Daniel Lynch: Thanks. Again, if you have a question, please press star, then 1. Our next question will come from Brian Peterson with Raymond James. Please go ahead.

Brian Peterson: Hi, thanks for taking the question. This is John for Brian, just one from us on international expansion. Clearly, it's been an area of focus for the company to expand internationally. I think in the past, you've mentioned more of a partner-driven motion, though, with that expansion, going forward. I'm just curious, given the results you've seen here internationally, if that's still the case or how you're thinking about international expansion as we move into 2020. In the first, call it three, four years of international expansion, we were focused on major new markets where we would lead with both our own personnel in sales, marketing, and partnership, as well as building out a partner network in those countries. So think going from the UK and Europe into France, Germany, Italy, Spain, Benelux, and the Nordics, as an example.

Like only I think it was eight or 18 second wait time on average for enterprise customers during peak holiday volumes.

That's pretty outstanding to get such fast and excellent customer service, while we are delivering ever improving.

Gross margins. So it is helping there, but I think the benefits are even bigger on the customer experience and <unk>.

Customer success side than they are on the financial side, Yeah. Let me add one point to that before you ask a follow up question as well I think that I really see it as a <unk> a productivity boost it more so than it is a cost of cost cutting thing and in the short run I think that.

The fact that so many customers are able to get the answers and that example, right. The fact that they're able to get their questions answered that quickly is just really a good thing and to breath point from our cost structure perspective that enables us to continue to have really really efficient cost effective support is Brent mentioned, where hiring folks and diverse locations. We have some folks that were hiring in Mexico. We have other folks that were high.

Brent Bellum: And then what we are doing now is staying strong in those major markets across EMEA, obviously Australia, New Zealand, the U.S. and Mexico, and Canada. But we're not looking last year or this year to put additional BigCommerce employees on the ground in the markets we're expanding into, but instead, work with partners. And we're seeing very interesting partnerships develop in Japan, in Korea, and in India. India's another country where we do have people on the ground, and the partner network's extraordinary. But if we think about South America, and other regions, for the time being, while we're focused on efficient growth, yes, it will be partner-led in these new markets rather than BigCommerce people-led. Thanks for the question. Thank you very much. The next question will come from Mark Murphy of J.P. Morgan. Please go ahead.

Bring in the United States and will continue to do so we're not looking to outsource or geographically move where our support is sitting we're wanting that to be mixed because we really also see and I think this is something that's really not really always widely understood about big commerce is that the folks that we have in tech support internally, we call them ninjas because they are.

On the front lines kind of you know taking care of our customers and that's also an amazing pipeline development that we have for future engineers as a career development path for us and that's something that's going to continue to be a really big priority for us. So while it's great that is differentiating the level of service and support that our customers get having such great investment on those <unk>.

[noise] sources internally in multiple different geographies is also great from a talent management development point of view for us as well, yeah, I'd have to Ireland or other location for your right hand language support.

Mark Murphy: Thank you very much. Brent, you mentioned using AI-based chatbots for customer support in your prepared comments. I'm just curious at a high level, is any of the positive margin progress that you've had so far at this point attributable to efficiency gains or productivity gains that are stemming from that kind of internal usage of Gen AI products, whether it be GitHub Copilot or customer support chatbots or anything else, or would you look at it and say that all of this was kind of 100% unrelated to AI? And then have a quick follow-up 2 things.

Okay. Yeah, I think it was 13 seconds on the wait time, but I mean, whether it was eight or 13 or you know or.

<unk> It seems like you have a great success.

I I just wanted to ask you if if if you're kind of extend this thoughts where you know you have the partnership with Google You know you you have access to all of Google's AI technology for the you know the product descriptions the customer recommendation to understanding the attentive search terms et cetera.

The <unk> you know could you think that that can create some sustainable differentiation like in other words.

Brent Bellum: Number one is, unlike one of our biggest competitors, we provide BigCommerce Human Support ourselves, with live phone numbers for all customers globally. And we're able to do that at an efficient level, partly because we're very operationally disciplined. You know, many of our tier one support personnel are now down in Mexico, which we've had real success hiring in. And on top of that, the chatbot option enables many customers to come in, ask a question, get an answer, and never even need to talk to a live human being.

Are you getting earlier access to Google products are you getting more help from Google to do kind of its views all that into your own products.

We absolutely are they're very closely closely partnered with sauce and think of us as a lead partner for everything they're doing in a I as it relates to E. Commerce I would also note that our approach as differentiated from.

From our multiple of our competitors because it's not proprietary I.

Daniel Lynch: And that's one of the reasons why I'm very proud of the, like only, I think it was the eight or 18 second wait time on average for our enterprise customers during peak holiday volumes. That's pretty outstanding to get such fast and excellent customer service while we're delivering an ever improving, www. BigCommerceHldg.com on the customer success side than they are on the financial side. The fact that so many customers are able to get the answers, in that example, right, the fact that they're able to get their questions answered that quickly is just really a good thing. And to Brent's point, from a cost structure perspective, that enables us to continue to have really, really efficient, cost-effective support. As Brent mentioned, we're hiring folks in diverse locations. We have some folks that we're hiring in Mexico.

I I I would I would point to all of Shopify, Salesforce and Adobe as focusing on proprietary branded a I, whereas bed commerce is being open and best of breed led will work with Google's best AI will work with.

Any other AI chat GPT engines, we'll both do proprietary a I products, but will also heavily bring our ecosystem partners. Our tech partners, Our agency partners actually to the Hackathons and the development sessions with Google and other AI partners and I think.

That open approach it might've been the case two years ago.

Where the best day, I was being done by the the giant global software conglomerates, but that's not the case anymore right. It's been democratize by Google by open AI and Microsoft by Facebook.

Daniel Lynch: We have other folks that we're hiring in the United States, and we'll continue to do so. We're not looking to outsource or geographically move where our support is sitting. We want that to be mixed.

And I think our open approach is going to lead to more and better.

Brent Bellum: We really also see, and I think this is something that's not really always widely understood about BigCommerce, is that the folks that we have in tech support internally, we call them ninjas because they are on the front lines kind of taking care of our customers. And that's also an amazing pipeline development that we have for future engineers as a career development path for us, and that's something that's going to continue to be a really big priority for us. So while it's great that it differentiates the level of service and support that our customers get, having such a great investment in those resources internally in multiple different geographies is also great from a talent management and development point of view for us as well. Yeah, I'd add Ireland is our other location for European language support. Okay, yeah, I think it was 13 seconds on the wait time.

I options for our ecosystem than the proprietary approaches of the three competitors I named.

Excellent. Thank you very much.

This concludes our question and answer session I would like to turn the conference back over to Mr. <unk> C E O into your mind for any closing remarks. Please go ahead Sir.

Right as we go into 2024, two summary messages from US. The first is customer focus and customer success. We are absolutely truly committed to bringing the world's best E Commerce product and service to our customers and our ecosystem, whether it's enterprise B B and B.

C product the world's best Omnichannel capabilities, multi geography in international selling capabilities.

Brent Bellum: But I mean, whether it was 8 or 13, or 18, it seems like you're having great success. I just wanted to ask you, if you kind of extend this thought, where you have the partnership with Google, you have access to all of Google's AI technology for product descriptions, customer recommendations, understanding the intent of search terms, etc. Do you think that can create some sustainable differentiation? In other words, are you getting earlier access to Google products? Are you getting more help from Google to kind of infuse all that into your own product? We absolutely are.

Or composable.

We're focused on the best product and service for our customers in the world.

Second main point is about efficient growth. We showed in 2023 that we can in a short timeframe.

Turn our business into a highly profitable <unk>.

Highly cashflow generating business with good macro and micro unit economics now that those are in place. The story for 2024 as efficient growth, where we would really like to demonstrate an ability to just kind of been the growth curve and get top line growth back to strong levels, but with extra.

Brent Bellum: They're very closely partnered with us and think of us as a lead partner for everything they're doing in AI as it relates to e-commerce. I would also note that our approach is differentiated from multiple of our competitors because it's not proprietary. I would point to all of Shopify, Salesforce, and Adobe as focusing on proprietary-branded AI, whereas BigCommerce is being open and best-of-breed-led. We'll work with Google's best AI, we'll work with any other AI chat GPT engines, we'll both do proprietary AI products, but we'll also heavily bring our ecosystem partners, our tech partners, our agency partners, to the hackathons and the development And I think that open approach. It might have been the case two years ago, where the best AI was being done by the giant global software conglomerates, but that's not the case anymore, right? It's been democratized by Google, by open AI, and Microsoft, by Facebook, and I think our open approach is going to lead to more and better.

Jordan narrowly good macro and micro unit economics that are now in place and so thanks for everybody who is following us are joining us on this journey and we look forward to talking again next quarter. Thanks.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

[music].

Brent Bellum: AI options for our ecosystem than the proprietary approaches of the three competitors I named. Excellent. Thank you very much.

Brent Bellum: This concludes our question and answer session. I would like to turn the conference back over to Mr. Brent Bellum, CEO and Chairman, for any closing remarks. Please go ahead, sir.

Brent Bellum: Great. As we go into 2024, here are two summary messages from us. The first is customer focus and customer success. We are absolutely, truly committed to bringing the world's best e-commerce product and service to our customers and our ecosystem, whether it's enterprise B2B and B2C products, the world's best omni-channel capabilities, multi-geography and international selling capabilities, or composable. We're focused on the best products and service for our customers in the world. The second main point is about efficient growth. We showed in 2023 that we can, in a short time frame, turn our business into a highly profitable, highly cash flow-generating business with good macro and micro unit economics. Now that those are in place, the story for 2024 is efficient growth, where we would really like to demonstrate an ability to kind of bend the growth curve and get top line growth back to strong levels, but with the extraordinarily good macro and micro unit economics that are now in place.

And so, thanks to everybody who is following us or joining us on this journey, and we look forward to talking to you again next quarter. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hl BigCommerceHldg.com, BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg BigCommerce Hldg Big