The thesis for Alteryx sounds great. Amazing products. Exceptional customer advocacy. Ever growing amount of data in the world. Companies create data in multiple, disparate, locations. Process automation is a critical need and is turning into table stakes. They estimate the TAM is $50B.
I’ve maintained a small position (0.6%) to keep my attention on the company.
On 10/5/2020, the company replaced the CEO (and co-founder) with the board member responsible for the CEO search, Mark Anderson.
On 12/9/2020 the company replaced a co-founder (Libby Duane Adams) with a new Chief Customer Officer, Matthew Stauble. (in his previous life he was in customer service at Palo Alto)
On 1/4/2021 the company hired a new Chief Revenue Officer away from Palo Alto and announced that its old CRO (Scott Jones) is leaving the company. Dean Darwin and Mark Anderson have worked together for 25 years. On this date, they also raised their guidance but gave tepid ARR guidance. They will report earnings on 2/9/2021.
I listened to the CEO and CFO in a fireside chat at the Needham conference.
Mark’s view is that he’s upskilled the CRO and CCO positions. The strategy is to create a more efficient sales force and apply resources to post-sales. Dean is a magnet for talent.
When asked about the confluence of factors in the data space, the emergence of Snowflake, Tableau being acquired, the amount of data moving to the cloud players (AWS, Azure, Google), etc, here is his response.
But this space is massive, and only gets bigger. And I think in the long run, it becomes measured in terms of hundreds of billions of dollars of TAM it’s lately. What we’re trying to do at Alteryx is really transform our business as all growing companies have to do and really build machine like, efficiencies and capabilities in taking the problems that customers have, and prioritizing them with engineering, and delivering features or software or tools or solutions that solve those problems, and then build the machine like capability and predictability equally importantly, and the go-to-market so that so we can take that innovation, put it in the hands of customers with as little friction as possible and earn permission to do more, because we do such a wonderful job of that, to my earlier point about making two key go-to-market hires, we will become – we will take that zealotry and get customers so much more.
He was asked about about their appetite for making acquisitions
But right now, its heads down, we were heads down, closing up the year, building out a plan for the FY2021 time. And it’s definitely a year of transition. But we want to make sure that we get back to predictability and working to optimize productivity and output from the field team, and complete, at least get our transformation another quarter to farther along before we start thinking about plugging more on top of that.
His response to the importance of partners (like PwC)
And as we continue to put stage appropriate people up and down the organizations, not just a few people at the top of the organization, Jack, it’s people all up and down the organization that want to come in, and work in an environment where there’s real clarity of purpose and mission, and an opportunity to do something really special. And I think at Alteryx, we feel we have that opportunity to strive to become the biggest, the most important company in data science and analytics, not for world power domination or financial gain, but because who better than us with our innovation, and the experiences that we facilitate, for customers, and we like have to get there.
In summary, the company is going through a ‘transformation’ and a ‘transition’.
- New leaders learning the products and markets.
- New Account Executives calling on customers
- New Sales Plan
- New Sales Structure
- New Compensation Plans
This is not to say that all of this wasn’t needed nor to say the new team won’t be able to execute. I don’t see how it happens in less than 6 months. I will be selling my shares in search of better returns.