Conferences Grew Nearly 30% in 2022 But Sell-side Conferences Barely Budged
Integrity Research Associates, LLC.
Conferences came roaring back in 2022, but bank=sponsored conferences grew less than 2%,
according to data supplied by investor relations platform provider Virtua. Physical
conferences resumed and virtual conferences waned.
The number of conferences in 2022 tracked by Virtua’s StockConferenceCalendar service
increased by 29% from 2021, achieving the highest level over the last six years. In
contrast, bank-sponsored conferences increased only 1.7% as many banks constrained their
corporate access programs. The market share of bank-sponsored conferences shrank to 33% in
2022 from 45% the prior year.
Credit Suisse surpassed rival UBS as the top conference organizer among banks, as UBS
radically downsized its conference sponsorship from 205 conferences in 2021 to 97 in 2022.
Third-ranked Citi cut back more modestly, reducing its conference sponsorship by 16%.
Some smaller investment banks, such as Redeye Capital, Stephens, and Sanford Bernstein,
aggressively expanded their conferences in 2022. Fourth-ranked Jefferies also upped their
conferences to 70 in 2022 from 48 in 2021.
In contrast, many of the bulge banks dialed back. Besides UBS and Citi, JP Morgan and Goldman
both reduced their conference sponsorship.
Only a few more bank sponsors
The overall number of conference sponsors increased 14% in 2022, from 388 in 2021 to 442. The
number of non-bank sponsors increased less than half that rate (6%).
The number of virtual-only conferences shrank nearly 40% in 2022, as physical conferences
once again became the most popular form.
New York and London resumed as most favored physical locations while Singapore displaced Hong
Kong as the most popular Asian venue. Seven of the top fifteen venues were located in North
The analysis is based on data supplied by Virtua StockConferenceCalendar, considered to be
the largest global database of investment conferences and presenters. Virtua is a financial
services technology company focused on providing platform-based analytical tools and
services tailored to the workflow needs of Investor Relations (IR) professionals and
publicly traded issuers. Although the firm is headquartered in Boston, much of the analysis
and data collection is done in India.
Virtua, which provides platform-based analytical services for Investor Relations (IR)
professionals, acquired StockConferenceCalendar in 2015 from Dremer IR Counsel, an IR
Although virtual conferences are no longer the norm, they won’t be going away. Their
of convenience, global reach, and reduced travel costs are supplemented by greater ease in
organizing, which means that virtual conferences will continue to be popular for topical
Nevertheless, virtual conferences can’t fully replicate the networking offered by physical
conferences. After two years of Covid isolation, demand for physical conferences was
overwhelming. Perhaps successive years will balance out virtual and physical conferences
Understanding Take Private Transactions
And trends to identify them before they go down
Have you ever heard of a company being taken private? Coupa is the latest example of a big
name being de-listed from a stock exchange and purchased by a private equity buyer.
It's becoming increasingly popular for companies to go private, especially when they are
trading at “attractive” prices. So what exactly does a take private entail? And why does it
A take private is a transaction in which a publicly-traded company returns to private company
status, generally as a result of a sale to one or more financial buyers. The buyer could be
strategic (Salesforce buying Slack), a private equity firm (Thoma Bravo buying Sailpoint),
eccentric billionaire (Elon Musk buying Twitter).
There are many reasons why companies might choose to go private. One of the main benefits is
the company is no longer subjected to the scrutiny of being a public company. It’s tough
in the lime light. There are a lot of expectations around performance.
As a private company you can generally operate with less transparency, which can allow you to
make decisions more quickly. This can be beneficial if the company wants to pursue a
that might not be popular with investors, or take a long time to materialize, such as a
Going private can also allow the company to take on greater debt, which in turn can provide
money for growth or other purposes.
Finally, taking a company private can allow the stakeholders to reap the benefits of a
company without the cost of keeping everyone up to date. The administrative burden that goes
along with reporting quarterly results is huge. There are entire departments of people at
companies focused legal and communication.
Real World Examples
Some of the most well-known companies that have been taken private include Dell, Toys R Us,
In 2013, Dell announced that it would be taken private in a deal worth $25 billion.
Toys R Us was taken private in 2005 in a deal worth $6.6 billion.
Burger King was taken private in 2010 in a deal worth $3.3 billion.
At the top of this post is a larger sample from the tech world, which we used in the analysis
Private Equity Players
Private equity firms are often the ones that take companies private.
Some of the most active private equity firms in this area include Thoma Bravo, Vista Equity,
Carlyle, and TPG Capital.
Together, these 5 firms have been involved in some of the biggest take private transactions
in recent years.
I teamed up with our friends at Virtua to investigate the financial profiles of
companies in the lead up to being taken private. They crunched the data from 50 tech take
privates over the last decade using their powerful lifecycle analysis tool.
The charts below represent Take Private company performance vs Tech Sector performance, with
Q = 0 representing the time of being taken private. This neutralizes for whatever the market
volatility was at the time (also known as financial benchmarking voodoo).
Signal #1: Lower EV / Sales
As a reminder, EV / Sales = Enterprise Value / Revenue
Enterprise value is calculated as market cap plus its debt (total debt) less any cash
From an investor perspective, higher value of EV/Sales can be indicative of the
“expensiveness” of the valuation of the company
Conversely lower EV/Sales ratio is considered better investment opportunity as the
undervalued (in relationship to its peers)
A low EV / Sales may also indicate lower growth expectations, while a high EV / Sales
investors expect big things (and big growth)
Takeaway: Companies with lower growth are in the cross hairs (single digit to high
those who were growing REALLY fast and slowed to medium fast
Signal #2: Lower EV / EBITDA
Generally, the lower the EV-to-EBITDA ratio, the more attractive the company may be as a
potential investment, as it spits out cash
A low EV-to-EBITDA ratio could signal that a stock is potentially undervalued
A lower EV/EBITDA means you're spending less money for a $1 of earnings. So that's a
Takeaway: Investors pony up for profitability, especially when it’s cheap.
Signal #3: Lower Price to Book Value
Investors use the price-to-book value to gauge whether a company's stock price is valued
A P/B ratio of one means that the stock price is trading in line with the book value of
A P/B ratio with lower values signals to investors that a stock may be undervalued
In other words, if a company liquidated all of its assets and paid off all its debt, the
would be the company's book value
Takeaway: The P/B ratio provides a valuable reality check for investors seeking growth
Who Could Be Taken Private in 2023?
Potential names that have been floated include Peloton, Shake Shack, and AMC
The biggest potential headwind for take privates in 2023 - the cost of debt. Many take
privates are financed with a heavy dose of debt. In fact, Twitter owes at least $1B annually
in interest payments on the $13B in debt required to take it private.
But then again, rising interest rates do contribute to the stock market dips that make take
privates a lot more appetizing… soo….
But, if I was a betting man (disclaimer: this is not financial advice, I just have a
degenerate streak and like to watch the ponies run from time to time), I’d say
My buddy Matteo writes “Work3” - a weekly column on the changing nature of work.
He interviewed me on my career journey, starting Most metrics, and where I see the “future of
work” going. Spoiler alert: I think people will increasingly see their networks as the
businesses they work for, not the C corps themselves. More in the link below:
I’d recommend you give Work3 a subscribe for a fresh take on workplace evolution.
Quote I’ve Been Pondering
Every culture has its own way of teaching the same lesson: Memento mori, the Romans
would remind themselves.
Remember you are mortal.
-Ryan Holiday, The Obstacle is the Way
Mostly made up: Growth adjusted gross profit per employee
I made up a metric
First off, thanks to everyone who joined the “Mostly talent
collective”. We had over 50 people join in the first week 🤯. The collective now includes candidates from companies like PwC, Bain, and McKinsey, all looking to join high growth startups🧠.
So, of course, I had to take the good boy for ice cream🍨 to celebrate.
If you’re an employee looking for your dream job, you can get on board 👇🏾
Step 3: $83K x (1+ 60%) revenue growth rate = $133K
Company A comes out as the more efficient operator, and a potentially better bet. Even
though Company A isn’t growing as fast as Company B, it has a healthier gross margin and
is generating more Gross Profit per employee.
With that example under our belts, let’s get familiar with the formula’s components and
why they’re important.
At the end of the day, the higher your gross
more money you have to run the rest of the business.
A gross margin of 74% (a rough median for software companies) means that for
every $1 the biz brings in, 74 cents is left over for salaries, rent, and other OPEX
(including those ugly laptop backpacks they give out each year at your company sales
Margins matter - take it from my friend Kyle Harrison, who dove into why Twilio is trading at a MASSIVE discount to other high growth SaaS companies like Atlassian and DataDog:
So when companies like Datadog and Atlassian are trading at ~10-15x revenue, why is Twilio down at ~1.5x revenue?
In part? Gross margins.
Remember that Twilio has ~50% gross margins.
Datadog? 77% Atlassian? 84% Cloudflare? 78%
Right out of the gate, that $2.8B in revenue? It’s
costing Twilio ~2.5x more to get it.
I believe we should STOP talking so much about revenue multiples and START talking more about multiples
of Gross Profit.
Well, as a friend of mine likes to say:
“I love Revenue, but if I fed my dog Revenue, he’d
die. He needs Gross Profit to survive.”
Gross Profit is the lifeblood of any business. Companies can’t just trade a dollar for a
dollar forever (unless it’s the Costco $1.38 hotdog).
Now, with that being said, you might say why don’t we just look at profitability?
I don’t want to over rotate and only size up companies based on their profitability. I think that too misses the forest through the trees when
you are talking about high growth tech firms.
EBITDA multiples are cool, but there are times when you are chasing a market opportunity and it makes sense to burn cash, IF you can still protect your gross margin, which will eventually be your route to scalability. Tech markets come with windows of opportunity, and the difference between being #1 vs #2 in a market is huge.
Gross Profit per Employee
This is a remix of one of my favorite metrics, Revenue
Revenue per employee is a simple metric that cuts through all the noise
There’s no hiding from it - just take the amount of revenue you’re generating and
divide it by the number of people on board
This should go up over time, and demonstrate
leverage in your business model.
With Revenue per Employee, ideally you get close to $250K or $300k per person
when you approach $100M in revenue
So for Gross Profit per Employee, ideally you get into the $200K to $250K range
as you approach scale (on an annualized basis)
This is something companies should track closely to make sure they aren’t getting
out over their skis with hiring during hyper growth
Revenue Growth Rate
Best measured on a TTM (trailing twelve month) basis
No matter how you slice it, high revenue growth covers up a lot of sins
The question this formula assess is… just how many sins?
So what’s the point?
The point of this formula is to balance business model
scalability (Gross Profit) with operational
leverage (Gross Profit per Head) and ability to execute on
the sales side (Revenue growth rate).
When I look at a company to work for, advise, or invest in, I want to have faith in where
they’re going. I’m very willing to accept that not all companies will be profitable
Applying the metric in real life:
Here’s Crowdstrike ($CRWD) vs their Cyber Security sector cohort. You can see they are
generating $15K to $25K above the industry median and average. It makes sense why
investors are willing to pay a premium - not only is their Gross Profit healthier than
most, they are generating it with a sensible number of employees on board, and growing
faster than the sector. A few more examples…
A(nother) cybersecurity company outperforming: Palo Alto ($PANW)
A cybersecurity company on the
rise: Sentinel One ($S)
A cybersecurity company underperforming: JAMF.
Putting it to use
This metric, in my (made up) opinion, is best used to compare high
tech growth companieswho are later in their lifecycles
(+$100M ARR, post series C, or post IPO) with similar
I think it’s also interesting to not only compare companies vs one another, but also
check how a single company is trending over time - are they getting better at what they
I’m going to start tracking Growth adjusted gross profit per
employee as my own personal “index” of sorts.
As a metrics wonk, it combines three of my favorite signals into one. I think looking
purely at revenue multiples quarter to quarter is misleading. You can still go fast and
grow like crazy, but have a rotten core that’s ripe for burn out.
And I don’t think we should only care about profitability. Like, how boring is that? If
you want slow growth and high profitability, go buy a car wash or dry cleaning business.
(I joke, I joke, I joke).
So there it is - Growth adjusted gross profit per employee.
Next time we revisit this metric we’ll size up the DevOps industry to see how companies
What I’ve been reading​
As a business leader, you have a few big decisions that will 10x your growth or sink your
That’s why I’m a big fan of Brian and his newsletter. Every week he shares simple tips to help you make the big choices that grow your business.
Join 7,000+ business leaders and check out The Competitive
Edge to help position your business to grow
“At no point in your rambling, incoherent response were you even close to
anything that could be considered a rational thought. Everyone in this room is now
dumber for having listened to it. I award you no points, and may God have mercy on your
-Principal in Billy Madison
Don't let the Rule of 40 rule your company
Why I think the Rule of 40 is lame
This Thursday I’ll be participating in a virtual event OpenView is putting on to roll out their 2022
SaaS Benchmarking Report. I’ve been a disciple of this report for +5 years, having built multiple annual operating plans off of the rich data set. To a CFO or FP&A professional in tech, it’s the holy grail of SaaS benchmarking.
Curt and Kyle at OV crunched the financial and operating metrics of 660
private SaaS companies so you don’t have to.
RSVP for the event and gain early access to the report here👇
In addition to the lucrative appearance fee I’ll be collecting, I also received early access to the data. While thumbing through it, their recent analysis on the Rule
40 caught my eye. You may have heard of this metric - like the Undertaker, it’s risen
from the dead during the latest tech market correction.
At the risk of ruffling some feathers, it’s time for me to come clean - I
think the Rule of 40 is lame. Let’s dig into why.
Disclosure: OpenView did not actually pay me anything to participate, however, I did stop by their office for happy hour two weeks ago and enjoyed two (free) Miller Lites and one (free) cupcake.
What’s the Rule of 40%?
Trying to measure efficiency when you’re losing money can be a mixed bag of burritos. Some businesses raise
a ton of
money so they can prioritize growth at all costs (see:
Gitlab). Other businesses are designed to run like a money printer, spitting
out free cash flow and fat dividends for shareholders (see:
But for many businesses, the truth lies somewhere in the middle. Some investors validate a “good” balance
between growth and profitability by checking if revenue growth rate plus profit (or loss) rate exceeds 40%.
So, if you’re growing at 50% y/y and have a -15% EBITDA margin, your Rule of 40% =
Where does the Rule of 40 go wrong?
I have four bones to pick with the Rule of 40:
It ignores where you are in your business lifecycle.
You can game it with superior growth.
It’s a hard target to keep consistent in all periods, due to seasonality
It’s a lowish bar if you want to be great.
I took a trip in the way back machine using Virtua
Research’slifecycle analysis tool to stress test a cohort of companies in the four quarters leading up to (Q-4 through Q-1) and immediately preceding (Q+1 through Q+4) their IPO (Q0).
The research is based on a selection of 60 PLG companies, in honor of OpenView.
Here are my arguments against a dogmatic
adherence to the Rule of 40:
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It ignores where you are in your business
WorkDay was a solid investment if you bought in when they went public, and maintains
a strong financial profile to this day. However, their Rule of 40 took a major dip
at time of IPO as they made some investments in the business to scale.
Nonetheless, their stock price jumped 72% on day of IPO. If you religiously followed
the Rule of 40 you would have dumped them, and kicked yourself down the road.
There are times to step on the gas pedal and say damn the
torpedoes. There are also times to get to an efficient
P&L in a hurry. Just because you are in one season rather than another doesn’t mean you are necessarily a “bad” company.
Takeaway: Not all periods are the same. And not all periods should be
You can game it by going big on just growth
I also think there are diminishing returns past a certain growth rate. Investors aren’t necessarily going to pay any extra for 125% growth vs 110% growth if you are losing 50% per year.
However, adhering to the Rule of 40 in a bubble would give you the vote of approval on growth of 140% and losses of 100%. Talk about false
Takeaway: Not all growth percentage points are created
It’s a hard target to keep consistent in all periods, due to seasonality
Here’s SmartSheet. They oscillate between a low of 35% and a high of 48%. It looks like one of those Inflatable
Whacky Willys at the used car markets.
I highly doubt when they touched 35% their CEO yelled “HALT THE PRESS! We must get
back to 40!”
It’s difficult to run your operations and stay at a
consistentRule of 40 output. Life just doesn’t work like that, especially if you skew heavily towards Q4
seasonality and an elongated enterprise sales
Takeaway: The Rule of 40 is a a general target to work to in the long
term, not something to nail period to period.
It’s a lowish bar
Peep Snowflake’s Rule of 40. They have every right to rename the metric the Rule of 60, since that’s where the Y axis starts. They were able to become efficient with scale, driving better bottom line margins at the same time their revenue grew leaps and bounds.
And here’s DataDog. It’s a similar story. The closest they come to 40% is 70%, a full 30% ahead of the “target”.
Finally, here’s the average and median across that cohort of 60 PLG SaaS companies.
You can see the average is closer to 50% and median closer to 45%.
Takeaway: Hitting 40 is more average than excellent, and no one wants to
build an average company.
As OpenView explains,
Rule of 40 has always been a solid gut
check for the general balance of a company’s growth and profitability. However, it’s become increasingly important as a driver
of how businesses are valued. For earlier stage companies, Rule of 40 can vary widely from quarter to quarter. Achieving
40 each quarter is not required. But, it is required to have a grasp on what caused a drop or spike, and what can be done to
get to 40 long term.
I’d go a step further and amend the last phrase to: “what can be done to consistently operate above
40 in the long term.”
Maybe it makes sense for stock market pickers to use the Rule of 40 as a “sanity” check. But as someone responsible for making sure the trains
run on time, I don’t think the Rule of 40 is very useful, for all the reasons outlined above.
Agree? Disagree? Come tell us at the event on Thursday November 12th at 12 EST. When you register you’ll get
a copy of the report.
What I’ve Been Reading
Speaking of PLG… I was recently turned on to Top of the Lyne: Hard data. Deep research. Jaw-dropping insights. And the freshest memes. The art and science of product-led growth. Recommended by 7,000+ revenue leaders from Canva, Stripe, Notion, Figma, and 1,000s of other PLG companies.
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