Prediction Not checkable as stated
Murphy: Many SaaS companies trading at 60x ARR will disappoint investors
“Also true that a lot of these companies won't live up to it, and it'll take a year or two before people realize, hey, you know, they're nowhere close to being worth what we thought.”
Prediction Held up
Epicor CEO: Epicor will hit $1B revenue this year with 25-33% cloud
“We've built that business into about a quarter of a billion dollars. We'll be about a billion dollar top line business this year. And between a quarter and a third of that now is the cloud.”
Prediction Not checkable as stated
Murphy: Epicor SaaS bookings will top out around 80% of total
“I think that for us a 60, 40 split will probably move towards 80, 20. I don't know if it'll ever go much beyond that because I think there'll always be a segment that likes to be do-it-yourselfers. When it comes to managing the ERP system, that's my guess.”
Insight
Murphy: Cloud ARR multiple inflection occurs at 33% to 50% of revenue
“There's kind of a within your question, I think there's a saturation point at around third to a half of your ARR. When you get to that point being cloud, people do have to say you're kind of a cloud business.”
Insight
Murphy: PE buyouts succeed when structured as bonds with call options
“Demonstrate over a period of maybe a year and a half or two years, six to eight quarters to the investment community that you've got a, it's kind of like a bond with the call option. You've got this bond, which is the recurring revenue stream. The call options…”
Insight
Murphy: PE-backed firms need liquidity events every 3 to 4 years
“I think where people get in trouble is when they want to create liquidity too frequently in private equity, you can't do it every year or every other year. Maybe it's every three years, or if they think they can wait five to 10 years, then you lose good people…”
Opinion
Murphy: Epicor needs 50%+ recurring revenue in SaaS before public listing
“I think it's half the Of our recurring revenue, half or more of our recurring revenue needs to be SaaS cloud revenue, and we're right about there.”
Disclosure
Murphy: Epicor reaches ~70% recurring revenue and $300M-$350M SaaS ARR
“So I'd say we're about 70% recurring, so we'll say 700,000,006 75 is recurring, and I'd say at around 300 to three 50 we're clearly we've crossed the saturation point sass.”
Assertion Not checkable as stated
Murphy: Epicor quarterly bookings shifted from 90% on-prem to 60% SaaS
“Four years ago in a given quarter, we would book a 90% on-prem. 10% SAS or less. In the most recent quarter, it was a sixty-forty split. It's flip-flop. So, 60% SAS, 40% on-prem.”
Assertion Not checkable as stated
Murphy: Epicor SaaS grows 30% to 40% while on-prem remains flat
“We've typically seen 30 to 40% growth, sometimes more in that SAS business, and it's most of our growth. And then with the on-prem Seeing it be roughly flat. It's the on-prem business and the maintenance business, it isn't contracting. It isn't getting smaller…”
Assertion Not checkable as stated
Epicor CEO: SaaS Net Dollar Retention Is Well Over 100%
“We aren't that high, but we're well over a hundred. I don't think we would share exactly what it is, but I'd say it's demonstrably higher than old fashioned maintenance, which is nice, right?”
Assertion Supported
Murphy: Epicor Refinanced Over $2B in Debt to Cut Rates 125 Bps
“In the last six months, and this is all, you know, public record. We went back into the markets and we're able to refinance the first lane and do really well on it. And we had earned the right to do that... We didn't go out and, you know, get a dividend or do …”
Assertion Not checkable as stated
Murphy: Epicor has 4,000 employees, with 100 heavily equity-compensated
“We've got 4000 employees, but a hundred or so, most of what they make is in stock or a big portion of what they make is in stock.”
