Thryv Sees Acceleration in Marketing Services Upgrades to SaaS Platform

• SaaS Subscriber Base Poised for Significant Expansion in Full Year 2024

• Upgrades from Marketing Services to account for 50% of new SaaS customers

• SaaS Revenues to Account for Nearly 40% of Revenue by Year-End 2024

Thryv Holdings, the provider of the leading small business SaaS platform, announced accelerated adoption of its SaaS platform by customers from its legacy Marketing Services business.

“We are pleased to announce our Marketing Services customers are increasingly moving to our SaaS platform,” said Thryv Chairman and CEO Joe Walsh. “This marks an important milestone for Thryv as we scale operations, establish new centers, and drive profitable SaaS growth.

“It symbolizes our commitment to delivering an unparalleled customer experience to small businesses and sets the stage for Thryv’s continued success in the SaaS landscape.”

Throughout Thryv’s evolution, the SaaS business has been acquiring customers through three distinct channels – upgrades offered to its Marketing Services client base by its sales organization; referrals from existing SaaS customers; and new SaaS sales made by its premise and inbound sales units. Today’s announcement underscores the growing importance of legacy customers upgrading from Marketing Services to SaaS. Many of Thryv’s Marketing Services customers are adopting the company’s new Marketing Center, which provides them the ability to run ads, generate leads, and analyze marketing performance.

The SaaS platform offers inter-operable centers that enable small businesses to automate and modernize a range of critical day-to-day functions.

“The center-based approach is the game-changer that helps us accelerate SaaS subscriber acquisition, enhance the value we provide to our customers, and streamline our overall business by eliminating legacy systems in our Marketing Services business,” Walsh said. “We encourage SaaS adoption by our small business customers because it enables them to become more competitive long-term. Importantly, by year-end 2024 we expect our high-margin SaaS business to account for approximately 40% of total revenue.”

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Business Model Evolution

Thryv has been prioritizing product and engineering investments to develop the center-based design. The SaaS platform eliminates the hassle for small businesses (SMBs) who become frustrated using various point solutions that do not speak to each other. Customers upgrading to Thryv’s SaaS platform find they can more easily automate their business operations because functionality is integrated and day to day tasks can all be operated from a single screen with a single login.

Thryv’s SaaS platform currently features three centers that offer small businesses everything they need to communicate, grow, and manage their business: Marketing Center℠; Business Center℠; and the forever-free Thryv Command Center. The centers allow clients to explore different modules that help them to operate a modern business and communicate with their customers across their preferred channels. The company intends to offer additional future centers that will help SMBs automate additional parts of their operations, saving time and money and making them easier to do business with.

“We have worked with our clients for decades, building trusted relationships and a strong understanding of the challenges small businesses face,” said Grant Freeman, President of Thryv Holdings. “As we’ve seen for the last several quarters, the accelerated uptake of our centers presents an exciting opportunity for customers to modernize their business. It is our mission to continue making the upgrade easy and to help capitalize on the high-value proposition of our platform.”

Thryv’s Center-based SaaS Platform

• Business Center. The company’s flagship do-it-all small business platform, Thryv Business Center is designed to provide clients with everything necessary to streamline day-to-day business, including customer relationship management, appointment scheduling, estimate and invoice creation, and online review management.

• Thryv Command Center. This freemium offering serves as a communications hub, offering: a centralized inbox for email, social and text messages; a business line (voice calls and text); and a chat component for direct messages and group chats. It allows clients to combine customer conversations from 12+ channels into a single, easy-to-follow discussion thread, an industry first.

• Marketing Center. This integrated marketing and advertising platform provides the tools small businesses need to market and grow their business. It simplifies the process of running ads, boosting online presence, understanding customer audiences and making data-driven decisions.

As part of the Company’s strategic evolution aimed at driving higher gross margins through its multi-center platform, the focus is on prioritizing the sale of such centers; including future centers slated for introduction in 2024 and beyond. This decision builds upon the Company’s financial success already achieved through its multi-center strategy, as evidenced by a 690 basis point year-over-year increase in SaaS adjusted gross margins and a 500 basis point year-over-year improvement in Net Dollar Retention (NDR) reported in the fourth quarter of 2023. By prioritizing center sales, Thryv seeks to amplify these results and unlock further value creation for investors and drive higher lifetime value for clients.

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