FiscalNote Holdings (NOTE) FY Conference Transcript

Summary of FiscalNote Conference Call Company Overview - Company: FiscalNote - Industry: AI-driven SaaS platform providing policy data insights and workflow tools - Core Offering: Subscription-based access to proprietary policy data and insights to help organizations navigate regulatory changes [4][6][22] Key Points and Arguments Market Context - Increasing complexity in policy and regulation impacts a wide range of organizations globally, making it essential for them to navigate these changes effectively [5][6][8] - Organizations are becoming more reliant on technology and AI to manage regulatory risks, moving away from traditional methods like spreadsheets [9][10] Customer Base - FiscalNote serves approximately 3,600 customers, including private sector companies, public sector entities, and NGOs [11][13] - Major clients include large organizations like Nestle, which face complex regulatory challenges in sourcing and distribution [12] Financial Performance - FiscalNote transitioned from a $24.5 million adjusted EBITDA loss in 2022 to achieving eight consecutive quarters of adjusted EBITDA profitability, with a profit of $9.8 million in 2024 [22][23] - The company aims to reduce debt and improve free cash flow, having increased free cash flow by $69 million over the past two years [25][26] Product Development - The launch of a new consolidated platform, PolicyNote, aims to replace legacy siloed products, enhancing user experience and engagement [30][32] - PolicyNote integrates various data sets into a single platform, improving customer engagement and retention [34][35] Innovation and AI Integration - FiscalNote emphasizes the importance of AI in enhancing its offerings, with AI-driven features expected to improve user experience and operational efficiency [53][58] - The company has launched 25 major enhancements to PolicyNote since its launch, indicating a strong focus on product innovation [41] Sales and Growth Strategy - The company anticipates a return to sequential ARR growth in the second half of the year, supported by a strong customer base and brand recognition [28][65] - Inbound leads have increased by 20% year-over-year, and the corporate new logo pipeline grew by 45% from Q1 to Q2 [47][48] Future Outlook - FiscalNote reaffirms its revenue guidance for the year, projecting revenues between $94 million and $100 million, with adjusted EBITDA between $10 million and $12 million [52] - The company is focused on product-led growth and operational discipline to ensure sustainable, durable positive free cash flow [64][65] Additional Important Insights - The migration of customers to the new PolicyNote platform is ahead of schedule, with plans to deprecate legacy platforms by the end of the year [68] - The company is not aggressively pushing prices during the transition to retain customers, which is expected to drive higher growth rates [71] - The share of ARR from multi-year agreements has doubled compared to the previous year, indicating increased customer confidence [50]