SolarWinds 2012 Analyst Day

99 Pages·2012·2.87 MB·English

by  Steve Molnar

SolarWinds 2012 Analyst Day
November 13, 2012
1
Legal Notice
Forward-Looking Statements
This presentation contains forward-looking statements, which are subject to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, that are based on our management’s beliefs and assumptions and on information currently
available to management. Forward-looking statements include all statements that are not historical facts including, but not
limited to, statements regarding our future financial results (including our financial outlook for the full year 2012 and 2013);
potential market and sale opportunities and the size of such opportunities; future acquisitions strategies; product development
plans and strategies; anticipated market trends; market demand for, and market adoption of, our products; operating strategies;
and any statements of assumptions underlying any of these items mentioned. These statements can be identified by terms
such as “estimates,” “expects,” “plans,” “anticipates,” “intends,” “predicts,” “projects,” “likely,” “outlook,” “could,” “should,”
“would,” “will” and similar expressions and the negatives of those terms.

There can be no assurance that future results will meet the expectations, estimates, or projections conveyed by these forward-
looking statements, which involve known and unknown risks, uncertainties and other factors. These factors and other
cautionary information relevant to these forward-looking statements are described further in our earnings press releases and in
our SEC filings, including our Form 10-K for the year ended December 31, 2011, which we encourage you to review. Except as
required by law, we assume no obligation to update these forward-looking statements publicly.

Non-GAAP Items
Some of the information included in this presentation is derived from SolarWinds' consolidated financial information, but is not
presented in SolarWinds' financial statements prepared in accordance with U.S. GAAP. Certain of the data is considered to be a
"Non-GAAP financial measure" under the rules of the Securities and Exchange Commission ("SEC"). Any Non-GAAP financial
measures supplement the Company's GAAP disclosures and should not be considered an alternative to the GAAP measures.
Management's rationale for the use of any Non-GAAP financial measure and the reconciliation for the most directly comparable
GAAP financial measure can be found in the Appendix to this presentation and on the Company's investor relations website at
ir.solarwinds.com.

© 2012, SolarWinds Worldwide, LLC. All Rights Reserved.
22
Agenda
Kevin Thompson
Introduction & Overview
PRESIDENT & CEO
Kevin Thompson
Growth Strategy
PRESIDENT & CEO

Break

Paul Strelzick
Go-to-Market Strategy
EVP, WORLDWIDE SALES
Doug Hibberd
Research & Development,
EVP, ENGINEERING &
Asia-Pacific Strategy
GM APAC
Lunch
Mike Berry
Finance
EVP, CFO
Kevin Thompson
Closing Remarks
PRESIDENT & CEO
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The Year in Review
» Financial Highlights
 Year-to-Date Revenue Growth of 37%
 Year-to-Date Non-GAAP Operating Margin of 54%
» Added Depth to our Product Lines
 Patch Management
 Mobile IT Management
 IT Help Desk
 Firewall Management
» International Expansion
 Localized Products
 Localized Websites
» Re-launched SolarWinds.com and thwack.com
» Commitment to Our Business Model Remains Strong
44
This Model Has Legs
Products & Technology Demand Generation
• Development team continued to scale while… • Marketing team continued to leverage the
 Supporting a steady stream of new web while evolving how we generate user
product releases and enhancements… demand
 That remain focused on solving our users’  Expanded web presence (Patchzone,
problems… SolarWinds.jp)
 At a level of efficiency that is consistent • Re-launched SolarWinds.com
with our historical margin structure  Improved architecture, SEO, etc.

Community, Support &
Sales

Maintenance
• Remain committed to a low touch, high- • Maintenance renewals team continued to
volume model for selling from the inside at a drive consistent customer retention rates
consistent & high level of sales rep productivity • Re-launched thwack.com
• But, change is constant...  Destination site for all IT Pros – not just
 Installed base team network engineers
 More targeted teams • Expanded customer base, same high quality
 Additional Int’l language capabilities support

55
The Model – It’s In Our DNA
Traditional IT Management
Vendors
• Affordably priced, user-centric • Expensive products that are
products that are powerful and difficult to use and geared toward
scalable, yet easy-to-use the CIO
 Show value out of the box  Finished on-site with services
• Web-based marketing • Traditional outbound marketing
activities
• Rapid product cycles
 Cold calls, trade shows, media ads,
• Low-touch, high-velocity sales
etc.
model based on sales from the
• Long development cycles
inside
 Short sales cycles • High-priced enterprise sales force
 Frictionless selling model  Long sales cycles
• Unexpected Simplicity  Complicated purchasing process
66
The Model - Beneath the Surface
A
b • Powerful, Yet Easy-to-Use, and Affordable
o
Easy to See, But v Products
e

t
Hard to Duplicate h • Web-Based Marketing
e

Given Everything S • Inside Sales
u
r
Beneath the Surface fa • Efficient R&D with Offshore Developers
c
e

• Culture and Discipline - No Deal is Bigger Than the
Model
• Metrics-Based Management From Top to Bottom
B
• Purpose-Built Business Systems that Support our
e
n
Unique Processes
e
a
t • ROI-Based View of Expenses
h

t
h • Demand Generation Expertise
e
S • Global Development Process That is Much More Than
u
r Offshoring
f
a
c • Decentralized, Around-the-Clock R&D Productivity
e

• Sales Management
 Selling From the Inside
 Team Management
 High Volume of Demand-Driven Leads

77
Finally, This Is a User Demand-Driven Sales Model
» Mix of Business in a Given Quarter is Driven by User
Demand…
 Demand is based on the IT management problems that have our
users’ attention at any given time
 And, that demand will vary quarter-to-quarter – we’re fine with that
» Model Provides Flexibility Against Shifting Demand
 Allows for rapid reallocation of resources
» Many Demand Generation Efforts Translate Into User
Demand Over Time
 Fluctuations in demand and user interest even out over longer time
periods

88
Our Product Lines Have Grown…
Network management Application & Server management
 Network Performance Monitor  Server & Application Monitor
 NetFlow Traffic Analyzer  Virtualization Manager
 Network Configuration Manager  Patch Manager
 IP Address Manager  Synthetic End User Monitor
 VoIP & Network Quality Manager
 Firewall Security Manager
 User Device Tracker
Remote management
 Mobile Admin™
Storage management  DameWare ®NT Utilities
 Storage Manager  DameWare ®Mini Remote
Control
Log & Event management IT help desk
 Log and Event Manager  Web Help Desk™
99
…But Those Product Lines Fit Together
• Markets
 Must be ripe for our model –
Large opportunity (or large
o
potential)
Markets Buyers
Well-defined problems
o
Opportunity for commoditization
o
• Buyers
 Typically the same person or same
group across product lines
 User is buyer; has discretionary
budget
Products Problems
• Problems
 “Have-to-solve” versus “nice-to-
solve”
• Products
Focus on interconnection between
 Geared toward users’ needs
product lines helps drive cross-sell
 Show value out of the box
opportunity
 Complexity is hidden from user
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