From what I understand, Appian sees itself as an “emerging growth company” and they do tick off some of the boxes I as a (total) beginner (to informed investing) would look at:

  • Gross margins for software subscriptions ~89% (overall ~69%) and increasing gross margins YoY judging from Q2 2020 over Q2 2019.

  • 30% YoY growth of cloud subscription revenue (but only 2% overall revenue growth (yet… ))

  • Small market cap ~5.5B

  • Trustworthy source (TMF) really likes Appian, but I haven’t seen any recent support for it.

But they are only guiding for about 8% YoY revenue growth… and I understand that this isn’t exactly the “hyper growth” this board is looking for.

Am I looking at an early opportunity for a big SaaS play? I’ve been invested with a moderate position since May. The recent surge in stock price doesn’t mean that much to me, since Appians price seems to evaporate pretty quickly as it is bouncing back and forth.

Is the reason for this simply the very slow revenue growth we are seeing here (total revenue, not cloud subscription)? What am I missing? Should I simply move on here?

Would appriate some points of view and pointers at what else to look at that I might be missing.


Thanks for the post. I am also curious if any of the moderators or older members of this board can add some extra light about this company.

Their Net Promoter Score is about 40% and gross margin around 67.19%, but muted forward growth? As per their SEC filing (…) they list their “Subscription Revenue Retention Rate 119 %” - but they have multiple components in their business outside their recurring model.

I know they had some pandemic related issues due to their business model struggling to provide professional services on site. I saw the stock go up recently. Prior to the pandemic they have acquired a process automation company, which provides them with additional TAM. They are also founder lead business.


They’re not growing very fast compared to the names discussed.

Their Net Promotor Score is atrocious! (we want a product and services group that sells itself)

Their GM is above average, but nothing to be overly excited about compared to the 88-92% numbers we see in others.

They don’t even make the farm team at the moment.

It’s good to keep an eye on companies from time to time, but don’t spend too much time on them once they fall short in any of those areas.

Founder led is great.
Right type of asset light business is also promising. The rest, isn’t.


Thanks for the additional insights everyone.

This Net Promotor Score wasn’t on my radar yet, but it matches my gut feeling about Appian:

They seemingly got a great product, but it just doesn’t seem to gain the traction it might deserve. It is really not selling itself, since why would a company want to have to develop applications by themselves after shelling out dough for Appian instead of going for a similar service that takes care of things directly? It seems difficult to see the value in Appian-made in-House apps. But companies that do eventually create a good dozen of such apps and seem to be very happy.

The Appian CEO doesn’t get tired of praising the amazingness of the product and how they are committed to reduce the time to create an app by 2x every couple years. Yet, it is still not the solution in a box right away (it takes hard work and creativity on the side of the customer).

T. Gardner seems to believe Appian is a 10-bagger within 7 to 10 years, but are we talking here about a “story” of that it MIGHT do that, but the numbers we are seeing RIGHT NOW are not real (yet)? This is a good learning experience for me, since it is hard to let go and I only own this since May.

(Sorry, this might be OT, but helpful for a beginner like me) But if I take the teachings to heart, should I be “ruthless” and trim Appian from my portfolio regardless of holding time and tax implications (if possible please provide “just perspective” on this)? If I cut it off, should I still continue to follow it actively to see whether revenue growth picks up strongly in the coming quarters? It feels like running after a lost love then…


Hi GDavenport,

Thanks for the extra light - this is very helpful. Can you recommend a good place to check for NPS so that the number is consistent across all companies reviewed? I am finding 40 at:

Do you guys consider anything above 50 good? Sorry if this information is available somewhere in the getting started posts, I went through the FAQ and could not locate it.

NPS should be well above 70 if you want to have the reputation of your products and services run faster than your self promotion of same.

Anything below 50% means you likely have significant people not willing to recommend your Product to another user.….

This is important for two reasons:

  1. High NPS make and maintain brand presence. The sales team does not have to be as large or it’s cycle as rigorous. Top of mind impressions are likely more successful, also.

  2. High NPS indicate land and expand tendency of your products and services. This internal focus is VERY IMPORTANT to our companies. Additional growth (DBNER)internally is significantly driven by this aspect of a company. More use, more users. This is closely tied to impressions indicated by NPS.

Caveat: This is a survey based system. NPS relies on someone being emotionally vested enough to take a survey. If your product is utility based and is a function of basic need, the likelihood of a great NPS is much less.

When the product works, it’s invisible.

When it doesn’t? Hell and damnation. So it goes.

Is Appian a utility provider, or like one? I think we could show some aspects of that, however, in the world of new, test, implement, app features, the utility feature will be further down the path than first impressions and initial use.

I work with a team that leverages the Microsoft PowerApps competing product. Our organization has been tasked with trying everything in PowerApps first before seeking an alternate remedy. As a result, two things are happening:

  1. Lots and lots of apps are being created. Some work, some don’t. No other tools are in use except the old tried and true spread sheets methods. Data is not rigorously being policed as a sole source of the truth and app coverage is more overlap than mesh.

  2. Infrastructure improvements like databases, wifi connectivity, and automated signal generation are all being worked on as a result of successful apps. Any app that proves it’s place, gets converted into a more central, secure, high fidelity system that is internal to our central management systems.

The above is part of the reason why larger companies who will really drive the model are not likely to try Appian. If NPS and other things are not incredible, even less so. <I’m making a jump here>

If we hear that NPS scores are improving to 70s and higher. That’s a green flag.
If we find features that intelligently recommend adjacent data streams for us in apps. That could be a green flag.

Before digging that deeply, watch the conference call and read the notes.

(Formerly long APPN - Exited position in February of this year in favor of ZM)


Appian reported Q3 earnings today.

They saw:

  • Increase in gross margin for their professional services from 32% to 40% YoY.
  • 90% Software subscription gross margins. Overall gross margins of 73% in Q3 2020 vs. 64% in Q3 2019.
  • Cloud subscription revenue growth of 40% YoY.
  • Cloud subscription revenue retention of 115%.
  • Guiding for a total revenue increase YoY of only 6 to 8% though…

There is a clear trend of relative professional services revenue decreasing and relative software subscription revenue increasing over the last 7 Quarters. This was about 50:50 in Q3 2017 and changed to now be around 65% subscription and 35% services.
There is still too much revenue coming from services, but trends are moving in the right direction.

Cloud subscription revenue retention appears to be stagnant at around 115%.

They seem to be gaining quite a few new customers. Doubling of new logos YoY. There don’t seem to be many major players becoming customers from what I could see, but I might be wrong.

Appian seems to be slowly moving towards the right direction, but growth is not yet that great I suppose. I will keep following them a bit longer and see if the trends continue and it takes off.