BlackLine builds software for financial teams to automate the financial close process. .
BlackLineJanuary 31, 2021
Thesis - BlackLine is a Saas company focused on the financial close process. Their software helps companies gain greater control, accuracy, visibility, automation and speed in their accounting processes. This in turn helps finance leaders to be more strategic with how they spend their time, rather than completing low-value, repetitive tasks. BlackLine’s revenue in 2019 was $336m and they estimate the total addressable market to be $28b annually, highlighting the market opportunity remaining. Without going into specific use-cases, you can get a broad stroke feel of the company’s value by looking at it’s customer list, which includes the likes of PepsiCo, Nike, Expedia, Roku and Nasqaq. BlackLine has been in Gartner’s Magic Quadrant for Cloud Financial Close solutions for 4 years in a row.
Leadership - Therese Tucker is the founder of BlackLine and led the company from it’s inception in 2001. She is a pioneer in the space, building the company with no external funding until it took $200m in private equity in 2013. She recently announced she would be stepping down from the CEO role into an executive chair role. In her place, Marc Huffman will be stepping up from role of COO. This is part of a steady and planned transition. Huffman is a seasoned exec in the space, having spent 14 years at Netsuite. He worked alongside Tucker for 2 years in the build up, leading the sales, marketing and customer-facing organisation.
Financials & Performance - As of Q3 2020, BlackLine announced 3,226 total customers, adding 88 during the quarter. The company grows its revenues consistently, achieving between 20-30% revenue growth over the last 9 quarters. The company has an attractive margin profile, increasing from 78% to 81% in the last 2 years. They use direct sales to attract enterprise customers and continue to see expansion in large accounts (> $250k), up from 73 in 2015 to 301 in 2019. They have net dollar expansion of 107%, meaning they grow revenues from existing customers. Their renewal rate of 97% shows customers typically stay around.