Docebo Inc
TSX:DCBO
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
46.88
74.08
|
| Price Target |
|
We'll email you a reminder when the closing price reaches CAD.
Choose the stock you wish to monitor with a price alert.
This alert will be permanently deleted.
Docebo Inc
You don't have any saved screeners yet
Good morning, everyone, and welcome to the Docebo Inc. First Quarter 2021 Earnings Call. [Operator Instructions] I'd now like to turn the conference over to Docebo's Investor Relations, Dennis Fong. Please go ahead, Dennis.
Thank you, operator. Before we begin, Docebo would like to remind listeners that certain information discussed today may be forward-looking in nature. Such forward-looking information reflects the company's current views with respect to future events. Any such information is subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those projected in the forward-looking statements. For more information on the risks, uncertainties and assumptions relating to forward-looking statements, please refer to Docebo's public filings, which are available on SEDAR and EDGAR. During the call, we will reference certain non-IFRS measures. Although we believe these measures provide useful supplemental information about our financial performance, they're not recognized measures and do not have standardized meanings under IFRS. Please see our MD&A for additional information regarding our non-IFRS financial measures, including for reconciliations to the nearest IFRS measures. Please note that unless otherwise stated, all references to any financial figures are in U.S. dollars. Now I'd like to turn the call over to Docebo's CEO, Claudio Erba.
Thank you, Dennis. Good morning, everyone, and thank you for joining us on our first quarter 2021 earnings call. With me today is Ian Kidson, our Chief Financial Officer; and Alessio Artuffo, our recently appointed President and Chief Revenue Officer. Learning technology has become a strategic investment for companies training for today. And in a post-pandemic world, we are seeing this in the ongoing strength of our sales pipeline, and this is being reflected in our financial result. In the first quarter, we were very pleased to report revenues and ARR growth of over 60% for the first time as a public company. Once again, we saw broad-based demand, adding 154 net new customers from the fourth quarter of 2020, with strength in new logo performance, upsell and OEM sales. Our ability to effectively deliver learning programs for both internal and external use cases on a single platform is a core strength. In fact, many of our customer use Docebo for both. We think this makes our addressable market of learners much larger than a traditional LMS that is designed for internal training because we not only train our customers, but also our customers' customer. A great example of this was a contract we signed in the first quarter with a fellow Canadian success story, Lightspeed POS. Many listener on this call will know that Lightspeed has built a fantastic business with a software-as-a-service platform that services over 135,000 customers location. They selected Docebo to launch a multi-audience learning use case that includes their internal employees as well as customer with the flexibility to provide unique experiences to each of their audiences. Our sales program are also becoming more vertical focused, and this has led to several reference success in the sports industry, with some great organization, including the Toronto Blue Jays, Spurs Sports and Entertainment, the owners of the San Antonio stores, and the First Tee. The Toronto Blue Jays selected Docebo late in the third quarter to create a branded Blue Jay training experience for their game day staff. For Spurs Sports and Entertainment, investing in their employees is core to their culture and values as a championship-driven organization. Through their use of Docebo, they intend to give their staff constant access to learnings, tools and resources to equip them to be successful. First Tee is a youth development organization established as a partnership between golf major organization, including the PGA TOUR, that help kids and teens build the strength of character through the game of golf. They saw the platform that could provide digital access to its curriculum to parents, participants and coaches across a network of 150 chapters in the U.S. and internationally. This was a large and complex use case, and we are delighted to be working with an organization like the First Tee with core values that we admire and we share. We also had a record cross-sell activity in the first quarter. And 1 I'd like to highlight is with ClearCorrect. ClearCorrect has been building confidence since 2006 with clear aligners, the alternative to braces. ClearCorrect journey with Docebo began in 2017. And after becoming a brand for the Straumann Group, the program has grown and shown a significant increase in engagement. This has led to ClearCorrect expansion of their platform to other Straumann Group brands and into other countries like Brazil in the first quarter. A third leg in our consistent growth performance have been our OEM business. For several quarter, now we have talked about building a pipeline of OEM and partnership opportunities. And I'm happy to update you on 4 that we have announced this week with Vartopia, Vinsys, Bluewater and MHR. Vartopia is a new OEM partner for Docebo. They are leading partner relationship management solution that connects technology vendors with a network of over 500,000 partners. Vartopia partnered with Docebo in an OEM agreement to deliver learning and certification through their partner portal solution deployed by their customers and partners around the world. Vinsys is an example of how we are leveraging partners to enter new geographies. They are a global leader in the corporate training space, and they have trained over 600,000 professional around the world. Vinsys will scale Docebo multiproduct learning suite to organization based in the Middle East and through Asia Pacific. 2 of our existing partners, Bluewater and MHR, are expanding existing partnership. Bluewater is developing a group of manager service provider offering based on Docebo, combining Bluewater expertise with our multiproduct learning suite. MHR is building on its early success with Docebo on their iTrent platform by embedding the full learning suite into their global HCM platform, People First. In addition, we continue to strengthen our relationship with AWS by joining the ISV Partner Path in the first quarter. This partnership taps into a number of AWS-tailored program with access to AWS resources and partner network to further broaden Docebo reach, particularly in emerging EMEA markets. What I like most about these deals is that they are all very different. Our OEM and partnership program now clearly extend beyond the HCM space, demonstrating the breadth of opportunities we see to partner with different software platform and channel partner to reach a wide range of industry vertical and audiences. Now I have spent most of this call talking about our customer momentum. But I believe the most important announcement we made in the first quarter was the launch of the Docebo Learning Suite, including Docebo Shape, a content creation product that leverage AI to create engaging learning content in minutes. With Docebo Learning Suite, we are transforming Docebo with products for the future that address every enterprise learning requirement. So our customer have a one-stop shop for all their learning needs. Earlier this week, we hosted a webinar to further illustrate our product vision with demonstration of some of the capability of this new product for the investment community. We featured Docebo Shape, Docebo Content, Docebo Learn LMS and Docebo Learning Impact that are available now; as well as future products like Docebo Flow that redefine the possibility of when and how learning is delivered; Docebo Content Hub and Docebo Learning Analytics, which we think will become a valuable addition for many of our Learn LMS customers. If you haven't had a chance, to watch the webinar, please go, take a look. It's posted on our Investor relationship website. This suite launch has been years in the making, and we are tremendously excited because it sets the stage for our evolution over the coming years. Thank you for listening. I will now pass the call to Ian to speak to the financials.
Thank you, Claudio, and good morning, everyone. As always, I'll remind folks that a detailed breakdown of our financial results for the 3 months ended March 31, 2021, can be found in our press release, MD&A and financial statements, which are all now available on our website and have also been filed on SEDAR and EDGAR. The slide deck accompanying our earnings call discussion was made available on our Investor Relations website this morning. For those who want to follow along, I'm starting my remarks on Slide 4. Docebo exited 2020 with strong momentum in its business, and this continued throughout the first quarter, driven by higher new logo sales, customer expansion and OEM revenue. As messaged in our last earnings call, in the past 3 months, we have continued to aggressively expand our capabilities. Since the end of the third quarter in 2020, we have hired nearly 170 additional people, and our results are now beginning to reflect the benefits from the increased investment. Our focus on growing this investment will continue for the next couple of quarters as we prepare the company for the added complexity of managing its expanded portfolio of new products. Total revenue this quarter grew to $21.7 million, an increase of 61% from the prior year period. Subscription revenues grew 62% from the prior year at $19.8 million, representing 91% of total revenue for the quarter. Professional services revenue in the fourth quarter was $2 million, an increase of 48% from the prior year period. ARR growth is the driver behind higher subscription revenue and internally remains the key metric that we use to measure the success of our operations. We recorded $83.4 million in ARR at the end of our first quarter, an increase of 60% over the $52.1 million in ARR that we had at the end of the first quarter in 2020. The chart presented in Slide 4 is illustrative of our progression over the past 12 months. When compared to the fourth quarter of 2020, we added $9.4 million in ARR this quarter, matching the fourth quarter's net ARR increase, which is a high watermark for us. We had 2,333 customers at the end of the first quarter of 2021, and our company-wide average contract value, or ACV, increased to approximately $36,000, up 25% from $28,000 at the end of the first quarter of 2020. The ACV from our new customers added just this quarter was approximately $45,000 and 78% of our new logo and upsell contracts were multiyear transactions. The ongoing shift in our customer profile to larger enterprises is the primary driver in our ACV growth. Slide 5 talks to gross profit for the first quarter. As a percentage of revenue, gross profit margin was 82.2% of sales, an increase from 79.1% in the prior year. Gross margin has increased from the prior year due to the benefits of scale with our hosting provider and remains within our target range of 82% to 85%. It was down slightly from 84% in the last quarter for 2 reasons: first, because we increased our headcount substantially; and second, as you may recall, in the fourth quarter of 2020, we benefited from a year-end true-up in the contract with our service provider. On Slide 6, you can see a summary of our operating expense lines. Total operating expenses for our first quarter increased to $23.5 million as compared to $10 million for the prior year. Included in the $23 million of operating expenses is a foreign exchange loss of $2 million that relates primarily to the cash held on our balance sheet and is, therefore, for the most part, unrealized. Operating costs, excluding this loss, were $21.5 million and compared to the $16.8 million in operating costs, also excluding foreign exchange impacts that we reported in the fourth quarter of 2020. The quarterly increase in operating expenses was primarily driven by higher G&A and sales and marketing expenses. Our G&A expense increased by $1.7 million as compared to the fourth quarter of 2020, up to $7.4 million in total as a result of experiencing a full quarter of higher accounting, legal and insurance fees associated with our NASDAQ listing. Within G&A, there was also $348,000 of nonrecurring costs associated with our U.S. IPO and the forMetris acquisition. Sales and marketing expense for the first quarter increased by $2.7 million from the fourth quarter, up to $9.1 million and represented 41.9% of revenue. As we messaged in our year-end earnings call, we have been aggressively investing in our sales and marketing infrastructure. There are also some seasonal aspects to the hiring on the sales side as we tend to onboard significantly more sales and marketing people at the beginning of the year as opposed to the middle or the end. Our medium-term expectation for sales and marketing expense as a percentage of total revenue remains unchanged at 35% to 40% and will continue to remain there for so long as our growth trajectory continues at or close to its current level. R&D expense for the first quarter was $4.1 million, an increase from $3.9 million that we reflected in the fourth quarter of 2020. The increase was driven primarily by a growth in headcount and the work that we have been doing to launch the Docebo Learning Suite. As a percentage of revenue, R&D was 19.1% of revenue compared to 20.8% in the fourth quarter last year and will likely remain around 20% of sales in the medium term, as we continue to proportionately invest with our sales growth. We reported an adjusted EBITDA loss of $2.5 million for the first quarter of 2021 compared to a loss of $2.4 million in the prior year. We also reported a net loss of $5.6 million for the first quarter this year, and that compares to a $0.7 million net income for the prior year period. As we've already noted, the net loss for the first quarter this year reflects a $2 million foreign exchange loss. Finally, free cash flow was negative $2.4 million in the first quarter, and our balance sheet continues to be very healthy with the net cash and cash equivalents balance of $217 million. As a management team, we are focused on continuing to drive organic revenue growth for so long as our CAC ratio remains attractive. At this stage, there's nothing that I can see in the near term that would suggest the momentum in our sales pipeline or customer acquisition costs have materially changed to the downside. As a result, we're going to keep driving the business on the path that we're on. And with the new products and OEM relationships now entering the mix, along with a very healthy core growth engine, we are very excited for the future. And with that, I'll turn it over to the operator now to take some questions from the analysts.
[Operator Instructions] Your first question comes from Robert Young with Canaccord.
First place I'd like to start is in the incremental ARR in the quarter -- second quarter of $9 million. Is there a way to unpack that a bit to understand the range of -- the ACV doesn't tell a full story around how large the largest are and how small the smallest are. And I was wondering if you could give a sense of how large some of the larger contracts that you're winning now? And if that's a big factor in driving ARR to where it is today, the incremental ARR where you'd stay rather?
Sure, Rob. We had 1 large customer that we signed and recorded -- actually, we recorded in the ARR in the first quarter. It was in excess of $1 million. But other than that, we had a very nicely distributed set, similar actually to what we had in the fourth quarter.
Okay. And then if you look at the -- what you said, record customer expansion activity, that's an ongoing trend. But can you talk about the size of expansions? Are they getting larger? I think the ACV data, if you just look at the incremental numbers, I think, you gave $45,000 for net new. The math would suggest $60,000 there. And so it seems just the expansions on average are larger than net new. Is that correct? And what would that imply?
Well, just to remind people, we -- this is the quarter where we recorded the expansion with the fast food service company. And so that helped all of our numbers this quarter on these mentioned sites.
Okay. So it's driven by 1 contract rather than like a general trend towards larger expansions?
You know what, I'll let Alessio add some color to that. But the short answer is no. It obviously was a big positive, but we were really pleased overall with our expansion activity outside of that single contract.
Yes, Ian, you're correct. That single contract that was significant in nature certainly helped. But we're observing our upsell, cross-sell business. We are observing success not only in more transactional user upgrades, they are indicative of good adoption and growth across our customers, but multi-department strategy is paying back. And we're succeeding in cross-sell activities, which effectively yield additional customers at higher ACV than average from the past.
Okay. And then for my second question, just really quickly, just given your exposure in Italy and the cadence of 2020, I was wondering if you could remind people how that year played out? A lot of people are looking at Q2 and beyond as being a tougher compare for most companies. And that may be different in the case for Docebo. So I thought you could remind us of how that played out last year, and then I'll pass the line.
Yes, Rob, I think you're right. We had last year -- if you go back to Q4 2019 and then look at Q1 '20, Q2 '20, we had, to all intents and purposes, flat ARR growth over those 3 quarters. So we will -- as we get to Q3 and 4 this year, we will have more difficult comps. No question, of course, just to put a plug-in there. Having said that, I think that underscores what we've been saying all along is that the growth in our business has not been COVID-driven. We've been very clear. COVID has been a tailwind and a headwind. The headwind was immediate -- sorry, yes, the headwind was immediate that be benefiting from that over the next 5 years.
Your next question comes from Chris Merwin with Goldman Sachs.
I just wanted to ask about the Docebo Learning Suite. I know it's very early days here, but anything you can share about initial traction. And then I guess as a related question, does this change the competitive map for you all in any way? And is this something also that's going to be sold through your OEM sales channel?
Chris, Claudio speaking. Strategically speaking, Docebo Suite is a strategic move to be positioned in a completely different way compared to our competitors. Second, it's built based on our -- on what we expect are our customer needs. They need to analyze more data. They need to build content quickly. They need to get decision to improve their learning efficiency and so on and so on. Let's say that it's something that, in the future, we will expand into -- I mean, the technology has been built, like we said on Monday in our product demo, to be also included into the OEM use cases, but not only, also into the expanded enterprise cases. I mean learning analytics, for example, can be used for internal training, but also to analyze data for the external training. That said, we started selling the first product, which is DLI, Docebo Learning Impact, which is the rebranding of the acquisition we made for forMetris. I mean we start marketing this in April. So as of today, we do not have any KPI to say what will perform, what will not perform, for sure. Over 1 year now, we are releasing a lot. We are transitioning to a single -- from a single product to a suite. And there will be products that will perform better than others. We made our bet internally. So it's a journey that just started. And as you know, I don't like to make projections without having any data. We have our entrepreneurial spirit that is driving by innovation, is made to make our customer life easy, is made to make our customer buy from 1 vendor only without aggregating these homogeneous technologies. And we know the industry. I mean we aim to know the industry because it's only 16 years -- me 16 years, Alessio and many others that are in the industry. So maybe we have some kind of feeling on how to improve it.
Okay. Perfect. And maybe just 1 more question. I mean given the strength we saw in ARR growth this quarter, are you able to maybe just qualitatively help us understand the strength of OEM relative to direct sales within the uptick in ARR that we saw this quarter?
The -- sure. So the OEM growth has been relatively steady, Chris, over the last 3 quarters. Having said that, the growth has been growing consistently. It's not growing anywhere near, obviously, at the same rate as we are overall. But we've been working very closely with our partners, and we're really happy with the progress that we're making there. We are still fundamentally realizing the majority of, I'll say, 80% to 90% of our OEM revenue from a single OEM partner. And so that's why -- and you've heard me say this several times. When I look over the next 2 to 3 years and think about sort of the hidden gems of why this company is going to succeed, it's the OEM side that gets me the most excited.
Your next question comes from Daniel Chan with TD.
Ian, on that last point you made. So Ceridian continues to win new customers and grow its recurring revenues. Would you say that you're seeing greater success with the new customers that they win? Or have you also been successful at selling into their existing customer base as well?
They're doing both, Dan. It's like anything else. Docebo got better at selling and implementing its products 2016 to 2020, and Ceridian is getting better at selling on our behalf Dayforce Learning over the past 18 months or 24 months. And their internal infrastructure is now well set and established to attack both fronts.
Okay. That's helpful. And then you mentioned in your prepared remarks that you're going to continue pushing. You're not seeing any changes. This time last year, you did talk about increased inbound momentum. Can you just give us some color on what you're seeing in some of these markets that are reopening getting past the pandemic? What are you seeing there that's giving you the confidence to continue pushing ahead?
Thank you for the question. We're very satisfied with our inbound results.
Can you guys hear me?
Yes. Sorry, I had an audio trouble with my headphone. Dan, I was saying, we're very satisfied with our audio -- with our results in inbound in quarter 1. Definitely, inbound is still the primary contributor to our growth when you look at the channel mix between inbound and outbound. In quarter 1, we have analyzed an increase in our attainment on the inbound side versus our goals, and we were very, very happy to see that. Not only in North America, but also in Europe, where, to an extent, we've seen that things have been a little bit more difficult with regards to the pace of vaccination and so on and so forth. So we've absolutely loved seeing an uptick in inbound results. And we believe, frankly, it's product and the response to the investments that we've made. We spoke about this in past calls. We staffed our marketing and digital marketing organization to really be aggressive on the search front, on the various channels that we can win several investments in strategic account-based marketing channels. And we're seeing the fruits of that pay and very, very happy to see that.
Your next question comes from Richard Tse with National Bank.
I just had a question on the competitive environment. Just sort of wondering if there's sort of been any change in terms of who you're displacing most often?
Ale, are you taking this?
I got it. Richard, it's a good question. Look, we certainly are seeing a trend of growth and success in the mid enterprise markets at a rapid pace. It's easier in a way to establish the vendors that we're displacing in those segments because there's less, right, when compared to the smaller market where there's more fragmentation. And really, we're strategically very focused on winning the business of enterprise organizations on a departmental level. And so when you think of the enterprises that have a learning product as part, for example, of their HCM or their talent management suite, look, there's not many companies that we compete with, and you guys know who those players are. And what we're hearing from these organizations, from the companies that we're winning, some were named today. When they choose us is they're very dialed in learning. They have a vision for learning that goes beyond internal. We spoke about Lightspeed. It's not uncommon for a company in that space that has the goal of training 2 audiences, internal and external, to select us over a more maybe standard internal corporate solution at enterprise level that does a good job in the context of an HR suite, but perhaps is not as innovative and specialized on the learning front. And that's our angle, and that's how we win that business. Richard, did I address it?
Yes. My second question has -- relates to the Docebo Learning Suite. It sounds like, obviously, a pretty compelling opportunity. I'm just trying to understand the relative size of the opportunity. So if you looked at the current base yesterday in terms of the product portfolio you had prior to this announcement, and you kind of look at what that opportunity is, had that product been around at the beginning, is it sort of 3x, 5x, 10x? So I'm just trying to get an understanding of the relative sort of increase in market opportunity here with that recent announcement.
Yes. Claudio speaking. Unfortunately, I brought my digital board yesterday. So I don't have a real number. And I think that everyone that is trying to make projections on numbers is just throwing random numbers. I mean, we are not here to start defying the market size and then building products, try to fulfill the market -- the total addressable market. We are here to build great products that makes our customer happy. So there is -- this is the real base. I mean, the best is are these products creating value for my customers? The growth is a consequence. For sure, if we are growing 60 with only one product, if we catch, if we will be -- if we win a couple of others, probably, we will grow faster. Let's say, you raised a great question, which is the total addressable market and the scope. The total addressable market of LMS, if someone say is $10 billion, either $11 billion, $7 billion, that means that no one knows how big it is. Okay. It's just a benchmark. But no one, for example, is addressing how big is the external use case for the learning management system. So -- and there is 1 piece of the puzzle that is completely missing. And the AI content creation for learning, which is our case, is a total new product. How can you estimate the total addressable market? I mean, are you -- how you can be realistic and get numbers that are not existing? And the same is for Learning Analytics. I can throw numbers, but this is not really -- it's not the way Docebo works. The way Docebo work is we think that our customer had challenges. In the past, we didn't solve these need for our customers. We learned from our mistakes, and then we are building great products. Success and growth is the consequence. It's not an estimate on how big we can be. And they're not saying -- I mean, maybe all the products that we are building will be 0 completely. We will miss our -- on our profit because our vision is completely dropped.Or any product will be a great success or in the middle some product will perform way better, some product will perform not good. I mean, in my heart, Docebo Shape is the most disruptive and is normative. But based on my customer needs, we can create immediate value for our customers with Docebo Learning Analytics. Docebo Learning Impact is already answering the question on why the training is successful in the organization. What is the contribution? So I'm not making any forecast. I'm just here to give great products and try to make my customer happy.
Richard, the only single add is when Claudio says, maybe they'll be 0, you know that makes me squirm. But look, the reality is -- like just to get a little philosophical for a moment. This company values intellectual honesty as much as any organization I've ever known. What we're trying to say is it's too early. We have no data, truly no data, to respond to your question. And we want to know just as eagerly as you do. And probably by the third, certainly the fourth quarter this year, we'll have some data that is at least indicative of where we think we're going to be. And I know you really would love us to put a peg in the board on this. But please just be a little patient. As soon as we have some information that we think is meaningful and reliable, then we'll be communicating it.
Yes. And Ian, I'm adding one another point here. There are 2 cluster of companies that we are learning from. There are the Microsoft and the Salesforce that are product business-driven. And then there are companies that are engineering-driven, like Google and VW. Google is building products, showing products in the market and some products will be hyper successful like Android. We are trying to mix both. We think that all the products we have released has a great chance of success because we need it internally at Docebo as a company. But in the same time, we are sure that some products will have more success and other product will have less success. What we did was covering all the life cycle from content building to data analytics. And let's say that when I say product, and I'm not saying models, it's because the product that we have built can run also inside a competitor ecosystem. So another customer that's having LMS can use Docebo Shape to deliver, to build the content that will be delivered with Learn LMS, can use Docebo Learning Analytics to analyze the data generated by another LMS and Docebo Learning Impact, which is forMetris is already running under other competitors' technology. So this is the big framework of the product strategy that I am try to execute during 2021, 2022, 2023.
Your next question comes from Martin Toner with ATB Capital.
Congrats on a great quarter and congrats to Alessio on the promotion.
Thanks, Martin.
My first question is on partner programs. The Bluewater extension sounds like a dedicated consulting practice that's dedicated to Docebo solution. Is that the case? And as -- and also, are you dedicating resources to this growing list of partners? I mean, are you adding to your team to manage this program? I'm sure there is a large number of prospective partners out there that you could add over time.
Martin, thank you for the question. The brief answer on Bluewater is you're correct. As you know, Bluewater has been, for many, many years, a leader in the professional services, managed services and overall knowledge in the consulting aspect behind learning and HCM solution more broadly. They have represented the big brands of learning management systems and beyond and have a deep industry knowledge in North America, but also reach into Europe. With their leadership team, we have a long-standing relationship with, we saw an opportunity of beginning to refine their knowledge in our technologies, and they started to help us on the integration, implementation front, so on the professional services side. But they are a go-to-market organization as well. So other than just doing consulting, they also had the commercial arm that was very, very interested in incorporating our technology in a laser-focused managed services approach where they would offer to their customer a set of services that incorporate us as the learning technology enabler. So we're very proud of it because these guys work with some of the best companies in North America and beyond. They know what they're doing. They are high-quality people, great people and high-quality learning professional. And we're just proud of growing that partnership. To your question about staffing in order to support our partnership overall, yes, we are very intentional and deliberate in the way we design our partnership organization. We don't necessarily share resources across the OEM and the strategic partner business in the sense that OEM is its own thing, has its own strategy and management and strategic resellers. They need a certain and different type of approach. But I would say we're largely focused on OEM, the flywheel of growth for the future, but we'll catch opportunities like Bluewater in the world and the announcement of Vinsys is a similar one. We like strategic resellers and strategic partners in geographies where we don't have a very strong physical presence. That's a good example for Middle East and APAC. And I don't know if you asked about it, but MHR is instead an example of growing and account managing an existing OEM, where we started with iTrent, a portion of their technology, but then they were so satisfied with our technology and adoption that they decided to extend it to their People First platform, their global HCM. So overall, we're very pleased with that progress.
Ale, there is another point about consulting companies that are our partners. There are some verticals, some industry in some geographies, that really need help during the transition into the digital transformation. Some company, our comfort zone IT companies, very high-growing innovative companies doesn't need an internal consultant to be digitally transformed. Other companies do. And we have to realize that a learning tool is one of the main pillar of digital transformation inside young and high growth or traditional, hyper profitable organization. And that's where the consultant can help going hand to hand with us and with the customer through a digital transformation process.
That's great. I really appreciate that thoughtful answer. Next question. Ian mentioned that most of the sales came from inbound requests. I know you guys are building out your outbound sales force. Can you talk a little bit about the -- about that? What your expectations are for these people? And when you think it will start contributing to numbers?
Sure. I believe what we said is that inbound is a great contributor. We are actually satisfied and very aligned with the plan that we had for outbound in terms of contribution, the source of channel of lead generation. Well, our plan is to continue to support the sales execution both inbound and outbound. And in addition to outbound with our account development teams that, if you will, you can see them as an outbound workforce in the context of existing customers to support what we have said over and over are cross-selling and upselling strategy. Our strategy overall at a high level remains unchanged. What -- some things that I'm happy to share is that we have reinforced our outbound organization with certain new management individuals that are bringing in the experience and are bringing in the skill set that before was very much grown in -- grown in-house, and we felt that it was the absolute appropriate time to reinforce with transformational talent that helps us accelerate that plan that we have ahead of us. In terms of contribution for the future, you can stay assured that we're very much interested in continuing to manage the mix of inbound and outbound. And here's what we like about outbound. We know that by creating outbound deals, we are able to enter in the organizational goals earlier than when we do so with inbound. And that means really the projects have a wider scope oftentimes and they also are less competitive because we establish a much more strategic relationship on the get-go. So not only very excited about outbound, but very dialed in it. And with the addition of the new talents on the management side looking forward to growing that business further.
Your next question comes from Suthan Sukumar with Eight Capital.
Congrats on a strong quarter. First question I had was I wanted to get an update on forMetris. How is the integration progressing to date? Has there been any change in your outlook or impact that you expect to generate from this business this year?
Suthan, I apologize, but my connection this morning is terrible and you were breaking up. I couldn't understand the question.
Apologies. I was asking if you guys can provide an update on your recent acquisition, forMetris. Just curious how the integration is progressing to date? And has there been any kind of change in the outlook or impact that you guys are expecting to generate from the business this year?
Yes. Suthan, forMetris has been aggressive with a very nice logo, by the way, into Docebo Learning Impact, frankly DLI. And it's already integrated inside our suite, is the first component together with the 1 that is a part of the suite of Docebo. And we start the market with early treatment. So actually, we are demoing the product. We are analyzing the feedback of the customers. We have built a strong road map that if I'm not wrong is rarely relying on the actual software stack plus a full revise of the -- from tandem that kind of keeping the AII though these are very well-trained, the forMetris AII in 2022. So there is a very solid road map and a very solid approach to the product because do not forget that DLI, Docebo Learning Impact, aka forMetris, is solving an industry dilemma that is the premier of premier. The ROI of learning, the return of investment, because you can only guess the return of investment when you make your quantitative data like how long the learner spend inside the course, what are the score in the suite or whatever. But in order to assess the return of learning, the return of investment, you need a qualitative answer. And the fact that the learner can answer in the training get the positive impact on his career, on the business and also running industry benchmark is the way to provide the ROI. So yes, we are marketing the product. We are excited. We are pumped. And we can't wait to have 140% attachment rate and keep it.
Perfect. And just to touch on kind of your broader M&A strategy. You guys are obviously in an aggressive ramp-up mode, and you guys are focused on execution, on kind of from an organic perspective. But do you guys see more opportunity now to do more M&A in kind of the near to midterm here to further enhance your platform and road map?
So assuming that we have an interesting cash balance, we are not -- we are -- we don't want to make M&A just because we have money in the bank, and we need to prove to use these money. The first thing that we want to avoid is making mistakes. And this is what worry me a lot. That said, we are not oriented to buy any competitors, for sure. We -- if there are opportunities there with an interesting price, what we would like to explore are possibility to acquire something we cannot build internally because we do not have the knowledge to do it. So if there is something that is consistent to our learning suite mission and vision that we cannot build internally. And we were joking with Rob Young like, "Oh you have offers. You are buying something into the virtual reality." This was a joke, but this is the kind of technology that we don't have expertise to build. So if we have to build -- to buy a technology is -- and this is not the ask, but it's something that we really don't have expertise or methodology or knowledge to build internally. In this case, we are open to explore this. Let's not forget that some asset are overpriced. Other assets are not fitting the Docebo vision and other assets are not fitting the Docebo company culture. So it's a tough result of opportunities. We are open, not in a hurry, but we are open.
Your next question comes from Nick Agostino with Laurentian Bank.
Congrats on the quarter. I guess, one -- maybe 2 questions for me. First, you guys talked about supporting the new module launches. You talked about obviously having -- adding more people to support the outbound initiatives and to support OEMs in general. I'm just wondering, is there an org structure, something you guys think you need to change internally to manage those multi-layers of growth that you're seeing right now, both from a product and from a sales perspective? Or is there a layer that you need to introduce within the organization to be able to manage just the level of growth you're seeing right now?
Nick, thank you for the question because for me, it's the opportunity to welcome Alessio as a President during this earning call because I didn't do it yet. You know that Alessio got his own promotion. Yes. And the fact that I have promoted -- we and the Board has decided to promote Alessio as a President is because he had shown to be a person that can work outside our directly reporting line, helping to strength and grow the whole organization subs. So the fact that we are moving Alessio -- we are adding new duties on Alessio roles, and this will be done in the night, because he is the Chief Revenue Officer, is the process to reshape the organization, to support the multiproduct strategy. And then I'll let Alessio chime in just to highlight what are the changes we are making and especially in his whole organization that actually is revenues and services to support the Docebo suite.
Well, thank you, Claudio. And Nick, great question. One that we are certainly very passionate about, I know I am, and I know this is some aspect that we think about a lot these days. The first comment that comes to mind, Nick, when I hear your question is that when you're part of the company that grows at the pace that we've been posting for the past, not only since we became public, but even before, my history at Docebo, year-over-year and really quarter-over-quarter, we have a DNA and a -- we've developed a -- I'll call an ability to understand where we're going to go in the future and adapt our skin to what's next. That is a continued process, and this change towards multi-product is just another milestone where we need to execute some evolution. Now to the multi-product changes. Claudio alluded to changes in the sales organization, professional services. I'll start from the outcomes. What we want out of any organizational improvement that we approach? We want happier customers that adopt our products better and stay with us longer. So rather than focusing on the inputs, as in the products, we look at the outcomes as a starting point. Then if we think that there's more complexity in terms of products, we need to think about our people are going to create -- where to create specialization, at what point in time and to what extent. This is a journey. If you don't do all of this in 1 shot, 1 day, it is -- I'd rather call it a program that gets designed and executed over time.One decision that we've been public about, we've shared this in our recent call, is implementing certain overlays at sales execution level, the guarantee and ownership of overlay quota at product family level, where those product families are made of certain products that have something in common, where product management, head of sales product lines or end product marketers work together in a virtual hybrid pod to really lead the organization towards building better products, marketing products appropriately and then enabling the workforce overall from sales through professional services via customer experience and in support to really then have the customers have great experiences. This is the journey that started a few months ago. We're in the middle of it. We'll continue to keep you updated, but just know that this is front and center of what we're dialed in.
Okay, great. And then my second question, just looking at your sales pipeline, I know you guys talk about having an extensive one. In the quarter itself, you indicated you had 1 large customer. Can you maybe give some indication or color as to the -- your outlook sales pipeline? Do you have some other large customers within that pipeline? Are there new geographies that are -- that you're seeing interest from? And are there any new verticals that you might be seeing interest from? And I'll leave it there.
Yes. Yes. So I'll respond to this question starting from the end of your question, you're referring to verticals. Verticals is one of those areas where, to your prior question, we look at that as a very important area to focus on for the future. We understand and appreciate that when you sell into a company, understanding their business deeply and intimately makes a difference. And when we look at the verticals that we do really well with at a high level, there's 8 to 9 verticals that really we repeat success, and we have found some level of magic sauce, a magic formula. With regard to the health of our pipeline and with regards to are we going to land other big logos and big wins? The answer is yes, we will. We will. I'm very confident that we will land both good companies with good ARRs as well as the OEMs. And we sound pretty bullish about it because we look at the data and the data speaks highly for our team's efforts in generating these opportunities. And now will we be able to say the names of these companies? That's a fine grained detail that is oftentimes, as you very well know, more in the court of our customers' legal and procurement officers, but we certainly will do our best to do so. We're excited about the names that we have in our pipeline, and we project some exciting wins ahead of us.
At this time, I'd like to turn the conference back for any closing remarks.
Yes. Thank you again for this -- for the time you dedicated to us during this call. I think we will speak again like in August. Thanks, all. Have a nice day.
Thanks, everybody.
Thanks, everyone.
Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a great day.