monday.com Ltd. Q3 FY2021 Earnings Call

Thank you for standing by and welcome to the monday.com Q3 Fiscal 2021 Earnings Conference Call. As a reminder, today’s conference call is being recorded. I would now like to turn the call over to your host, Mr. Byron Stephen, Investor Relations Director. Please go ahead, sir.

Thank you. Good day everyone, and welcome to monday.com’s third quarter 2021 earnings conference call. Joining me today are Roy Mann and Eran Zinman, co-CEOs of monday.com, and Eliran Glazer, monday.com’s CFO. Earlier today we released our results for the third quarter. Our earnings materials are available on our investor relations website at ir.monday.com. There you will find the investor presentation that accompanies our prepared remarks and a replay of today’s webcast under the News and Events section. Certain statements made on the call today may be forward-looking statements which reflect management's best judgment based on currently available information. These statements involve risks and uncertainties that may cause actual results to differ from our expectations. Please refer to our earnings release for more information on the specific factors that could cause actual results to differ materially from our forward-looking statements. Additionally, non-GAAP financial measures may be discussed on the call. Reconciliations to the most directly comparable GAAP financial measures are available in the earnings release and the earnings presentation for today's call, which is posted on our Investor Relations website. With that, let me turn the call over to Roy.

Thank you, Byron, and welcome to the monday.com team. Thank you everyone for joining us today. During our first earnings call, we were thrilled to introduce many of you to monday.com and to share with you our thoughts on the company and the large opportunity ahead of us. Going forward, we will focus these calls on our most recent performance and our future expectations. We invite those of you who are still just getting to know monday.com and our Work OS platform to visit our company and investor relations websites where we have many videos and lots of other content that should be helpful in understanding our company and our business. Now let me briefly talk to you about Q3, which was another strong quarter of growth. Even more organizations used monday.com to create software that fits their needs. Revenue grew 95% year-over-year to $83 million, as we continue to drive growth through the acquisition of new customers and increase adoption and expansion within our existing customer base. As mentioned previously, upmarket growth is one of our top priorities. I’m pleased to report that our expansion into the enterprise space continues to gain momentum. We ended the third quarter with 613 enterprise customers, up 231% from 185 in the third quarter of 2020. Additionally, we continue to expand within our existing customer base. Our net dollar retention rate increased in the third quarter, as a result of our ability to continue to deliver strong ROI and a great customer experience. Net dollar retention for customers with more than 10 users improved to over 130%, and our net dollar retention rate for all customers improved to over 115%. As a reminder, our net dollar retention rate is a trailing four-quarter weighted average calculation. Because of these outstanding results and our continued upward trajectory, we are raising guidance for the remainder of the year. For full-year revenue, we are increasing guidance to a range of $300 million to $301 million, representing 86% growth for the year. Eliran will provide you with more details on our third quarter results along with full updated guidance. I’ll now turn it over to Eran to give you some further highlights from Q3.

Thank you, Roy. As we continue to enhance our product innovation, we are providing our customers with more tools to easily build their ideal no-code, low-code work software. In Q3, we had a strong launch of our new monday workdocs, introduced new features with My Work, and showcased one of the first 2D work management applications in the Quest store during Meta’s recent Connect event. First, let's discuss monday workdocs. We launched workdocs in Q3, enabling our customers to manage their work, ideas, and data in a flexible manner. This provides new avenues for onboarding and adopting our platform. Currently, customers are utilizing monday workdocs across various use cases and industries, including marketing, operations, and CRM. More than 40,000 existing customers are already making use of monday workdocs, many of whom are using it for core and complex workflows. Since the launch, our customers have created over 300,000 workdocs on monday.com. It's remarkable to see the enthusiasm for monday workdocs, and in keeping with our mission, we aimed to give our customers even more flexibility to tailor monday workdocs to meet their business needs. That’s why we introduced the ability to create layouts with monday workdocs. Layouts enable customers to design any kind of template with live data, such as a CRM contact page, a deal page, or a marketing campaign overview. The majority of our customers are utilizing our no-code automations and integrations, with all of our enterprise accounts using them, and 88% employing over 50 different automations. Over the past year, our customers have automated more than 900 million actions using our platform. This quarter, we launched the dynamic workflow builder, allowing our customers to effortlessly create any type of new automation or integration, regardless of complexity, without any coding. Customers can now combine actions and triggers without limits. Developers can also introduce their own no-code automations and integrations to expand the applications available for our customers. Our dynamic workflow builder will elevate our automations and integrations, empowering both customers and developers. We are thrilled to introduce My Work, a centralized space for customers and organizations to manage all items related to their account, including deals, campaigns, tasks, and more. This mega-table allows individuals within teams to collect customized data across all business units. We believe My Work represents another advancement in equipping organizations with the tools needed to boost operational efficiency and productivity. I will now pass it back to Roy to further elaborate on our growing ecosystem.

Thanks, Eran. We made steady progress during the quarter in growing our ecosystem and expanding our global footprint. During the third quarter, we signed a new global alliance agreement with Tata Consultancy Services, a leading global IT services, consulting and business solutions organization. TCS and monday will work together to innovate digital workflow and automation solutions, transforming workplace collaboration while ensuring regulatory compliance. We also partnered with Hootsuite and Semrush, who have built apps on the monday marketplace, to help deepen the value for customers using monday for marketing operations. Partnering with our customers is key to molding our platform’s future together. Lastly, we expanded our workforce presence with additional offices in Tokyo and Sao Paulo. We will continue to invest in growing our ecosystem and workforce in order to serve the over one billion global knowledge workers. Now, let me turn it back to Eran to discuss our operating highlights.

Thanks Roy. We had another outstanding quarter in terms of customer wins and expansions. These were broad-based across industry verticals, with major companies including Jamf, eBay, Cegedim, and Outbrain. Let me briefly speak about Jamf and how their usage of our Work OS continues to evolve. Jamf is the world's leader in Apple Enterprise Management, helping more than 57,000 companies, schools, and government organizations around the world manage and secure more than 25 million Apple services. Jamf's marketing team has been using the monday.com Work OS to increase collaboration and efficiency since 2019. Recently they have added many more groups, such as product, engineering project management, and sales enablement to the platform, allowing their 2,000 employees to work more closely together. This is another example of how monday.com can help high-growth global companies, and we're very happy to be part of their growth and success. Our exceptional third quarter results are further proof that our customers are seeing the value of using our Work OS. With the platform’s no-code capabilities, customers can adapt each building block to build software applications and tools that fit their desired use case and evolving needs. Creating a great user experience is at the core of how our company operates, which was recently on display at Elevate, our flagship customer conference. At this year’s Elevate, we were able to help even more customers reimagine the way that they work, with over 52,000 registrants from over 100 countries, over three times the number of registrants from last year. Additionally, we continue to make investments in our people, and leading publications are taking notice. During the past quarter, monday.com was recognized by Fortune magazine as one of the Best Small to Medium Workplaces, along with one of the Best Places to Work for Millennials. I am extremely proud of our employees and where our company has come in a short amount of time. The opportunity ahead of us is huge. We believe that we are at the intersection of a number of work trends: no-code, low-code, massive digitization, and remote work, which positions our Work OS to become the market leader in our category. I’ll now turn it over to Eliran to cover our financials and guidance.

Thank you, Eran, and thank you to everyone for joining our call. Today, I’ll review our third quarter fiscal 2021 results in detail and provide updated guidance for the fourth quarter and full year fiscal 2021. We were extremely pleased with the results of the quarter, which demonstrated continued high growth at scale across all fronts. As Roy mentioned, total revenue in the third quarter came in at $83 million, up 95% year-over-year, led by large expansions within our existing customer base and acquisition of new customers. We continue to execute against an ambitious hiring plan. For Q3, we ended the quarter with close to 950 employees globally. This represents an increase of more than 50% from a year ago, with the majority of additions coming from R&D and sales & marketing. We plan to continue to make substantial investments in these categories for the foreseeable future. For the remainder of the financial metrics disclosed, unless otherwise noted, I will be referencing non-GAAP financial measures. We have provided a reconciliation of GAAP to non-GAAP financials in our earnings release. Gross margin came in at 90.2%, up from 87.1% in the year-ago quarter. Research and development expense was $14.3 million, or 17% of revenue, compared to 22% in the year-ago quarter. We will continue to invest purposefully as we position monday.com to drive durable growth and win in our large addressable markets. While we continue to invest significantly in R&D, the pace of our revenue growth has outpaced the investment growth. Sales and marketing expense was $61 million, or 73% of revenue, compared to 128% in the year-ago quarter. The improvement was driven primarily by continued efficiencies as we continue to scale our sales and marketing spend to focus on customers with 10 plus users and enterprise customers. Similar to R&D, the pace of our revenue growth has outpaced the investment growth. G&A expense was $9.1 million, or 11% of revenue, compared to 9% in the year-ago quarter, reflecting increased costs of being a public company. Operating loss was $9.4 million, and operating loss margin improved to negative 11%. Net loss was $11.4 million, and loss per share was negative $0.26. Moving on to the balance sheet and cash flow. We ended the quarter with approximately $876.2 million in cash and cash equivalents. Net cash provided by operating activities was $3.8 million in the quarter. Adjusted free cash flow was $2.9 million and was driven by strong collections stemming from our continued strong billings. Adjusted free cash flow is defined as net cash from operating activities, less cash used for property and equipment and capitalized software costs, excluding non-recurring items such as costs related to the build-out of our corporate headquarter office in Tel-Aviv. Now turning to our outlook for the fourth quarter and the full year 2021. For the fourth quarter of fiscal year 2021, we expect our revenue to be in the range of $87 million to $88 million, representing growth of 74% to 75% year-over-year. We expect a non-GAAP operating loss of $23 million to $22 million. For the full year 2021, we are raising guidance and now expect revenues to be in the range of $300 million to $301 million, representing growth of 86% to 87% year-over-year. We expect a full-year non-GAAP operating loss of $65 million to $64 million and a negative operating margin of 22% to 21%. As our guidance indicates, we expect to end 2021 on a very positive note and enter 2022 with strong momentum. We plan to introduce guidance for 2022 on our next earnings call.

Our first question comes from Kash Rangan of Goldman Sachs. Your line is open.

Hi. Thank you very much. Congratulations on a spectacular quarter here. Not only did you show solid top line, but you were able to show leverage on the bottom line here as well. All the metrics look fantastic, so congrats. My question is, as you look at '22 and beyond, it looks like when you compare your financial results to the current company with the largest revenue, you're coming up on them very quickly. And so I'm curious to get your thoughts on the competitive landscape, especially as you move upmarket. What is it like, are you still seeing the wide-open space that you did at the time of the IPO and before? Are you seeing, at the margin, some changes in the competitive landscape? And as a result of moving upmarket, I would assume that the prospects in the deal sizes that are afforded to you will start to expand pretty significantly. And so you're going to have to hire more enterprise-class salespeople? How is that motion coming along for you guys, as you look upon this tremendous option in front of you? Thank you so much.

Hi, Kash. It's Roy. Thank you for the question. Yes, we see this as a greenfield market, and the answer is definitely yes. We are now starting to see companies asking for a Work OS. Until now, they viewed us for different solutions rather than for building their own software. This understanding is emerging as they engage with us. It's a positive sign that people are beginning to recognize this category, and companies are actively seeking it. I believe we are just at the beginning. As we move upmarket, we will need to scale our sales operations, invest significantly in both marketing and sales, and develop this area as we expand. This is something we are planning for this year and next, and we are very optimistic about it.

Wonderful. Thank you very much.

Thank you. Our next question comes from Ittai Kidron of Oppenheimer. Your line is open.

Thanks, everyone. I have a couple of questions. Can you discuss Workdocs and My Work given your strong start? I'm curious about how these solutions are affecting your net retention numbers. Additionally, Eliran, could you address the impact of the Israeli Shekel on planning and operational expenses as we move into 2022? How far in advance are you hedged, and when will this start to have an effect?

Yes. So hi, Ittai this is Eran. I can start with the first part of your question, then I'll hand over to Eliran. So as we mentioned in the beginning, we see amazing adoption of workdocs, more than 40,000 accounts are using it. But I think even more importantly, 50% of all docs are being used for what we define as core workflows, meaning a very important part of how companies manage their day to day. This is up to date, one of our most widely adopted features in such a short amount of time. More than 250,000 workdocs were created since we launched, and it was like a soft launch. So, looking at all parameters, we see this as a huge success. It's hard to say how much this will impact net retention because it's still early days. But judging from the adoption, excitement, and the feedback we get from users, I'm sure it has a lot of value to our customers and it will be reflected in their satisfaction and how they use the platform over time.

Thank you, Eran. Hey, Ittai, it's Eliran. Regarding your question about the Shekel, this is indeed a challenge for the entire startup ecosystem in Israel. From a global perspective, 50% of our expenses are in U.S. dollars, which helps hedge our situation, especially concerning our online marketing and payroll outside of Israel. Additionally, we are utilizing a hedging company in Israel to protect our budget. This year, we set the dollar rate at 3.2 and the shekel at 3.1, and we are proactively managing this risk. While we don’t view it as a significant concern due to our expense distribution, we are closely monitoring the shekel's current value. On the revenue side, most of our income is in U.S. dollars, with a small portion in euros and British pounds. Therefore, we are also exploring hedging strategies to safeguard our revenue where possible.

Excellent. Good stuff. Congrats guys.

Thank you. Our next question comes from Scott Berg of Needham. Your line is open.

Yes, thank you very much. I will add my congrats on a very solid quarter. My first question is, I'm curious to what extent you think you're seeing uplift in demand based on a favorable linkage with being able to enable companies to adjust to hybrid workforces. In other words, having employees that will be both remote and in office, as the economy starts to reopen from the pandemic, just in terms of creating visibility to better collaboration around projects and deadlines.

Thank you. It's Roy. Even at the start of the pandemic, we received numerous reports from customers stating that transitioning to remote work was seamless for them. I believe we significantly contributed to helping individuals and organizations adapt, whether they are working in the office, remotely, or a combination of both. The situation is constantly evolving, and while I'm not sure how it is globally, in Israel, we frequently alternate between different work arrangements, and our systems remain stable, allowing you to work from anywhere.

Okay. As a follow-up, I was chuckling because I saw another monday.com ad on my browser when I logged in this morning to listen to the call. I click every time I see one of your ads. A couple of times a week. I think these advertising campaigns are brilliant. They're fantastic if you had one that did have the gorilla or Bigfoot or something like that, they're super creative. We also keep hearing that Apple's deprecation of IDFA is kind of affecting that this model of performance advertising, right, because you might not be able to use cookies or some of these low privacy schemes. I guess I'm curious, how have you been able to adapt and keep this retargeting going with these ads across our devices and websites? How have you been able to successfully navigate that and stay ahead of the curve?

Yes. Hi, Mark. This is Eran. I can answer that question. The changes that you refer to are affecting more B2C companies who rely heavily on advertising through mobile devices and tracking people across different applications. We are in a different position in terms of how we advertise. First of all, a big part of our budget is going through Google AdWords and other services that are more intent-based. So it's not about tracking people, but seeing people's intent and what they’re searching for. On platforms such as Facebook or Instagram, we target mostly what people are interested in and not personal information. So those changes aren’t affecting us at all in terms of our ability to target people and find relevant customers on those platforms.

And maybe, Mark, to add to what Eran said, we also have a DPO in the organization that is working very closely with us, and we are looking at all the security issues with regards to our campaigns. We don't see much of an impact, but I would like to also take the positives of what you said earlier and say that we continue to invest aggressively in our online campaigns. What you see is part of our strategy. So for Q4, even next year, this is one of the things that we would like to double down to make sure that you and your friends and colleagues will continue to see this amazing advertising as we continue to invest in them.

Great. Thank you very much.

Thank you. Our next question comes from Derrick Wood of Cowen and Company. Your line is open.

Thanks. Very impressive quarter. A couple questions on the inflection and new 50k customers. Is that driven all by expansion business? Or are you starting to see more net new customers landing in that 50k range? And could you comment on what geographies you're seeing in terms of incremental strike?

Yes. Hi, Derrick. This is Eran. I would say both. We see our existing customers expanding. To remind us, our model is on an expand basis. Usually people start using monday organically and scale, and then our sales team picks up those leads and has them scale. So we definitely see a lot of benefits from that, and we get more and more customers that are able to scale within our platform. But one very interesting trend that we're starting to see as we scale and grow our brand is customers who land with higher contracts, people that want to adopt monday widely within their company. So my answer would be that both those trends are what's affecting the growth. And like Eliran mentioned in the beginning, this is a core part of our strategy going forward and a big focus for us as a company.

And maybe just to add to Eran, we learned that bigger businesses see a better retention profile, obligating parts of our KPIs and to the results that you're seeing in the press release.

Fantastic. Regarding your second question about the potential global alliance with TalkTalk, could you elaborate on how you intend to strengthen this partnership and utilize new channel opportunities? What is your strategy in this regard?

Yes, I can pick this one. Hi. It's Roy. We see partners as a big part of our strategy worldwide. TalkTalk is one of them. We have over 100 partnerships worldwide of medium size, and we're growing into the large ones. It's amazing; we see a lot of synergies with existing practices that they have that we can just like integrate into those, and it's super exciting.

Thank you very much.

Thank you. Our next question comes from DJ Hynes of Canaccord. Your line is open.

Hey, guys, I’ll echo and congrats. Excellent results. I want to ask a little bit about the marketplace. You've announced Hootsuite and Semrush building out apps in the marketplace. I think you've talked about launching a payment system into the marketplace at some point. Obviously, that would be huge for your partners there. Just any thoughts around timing and ability to monetize that, as the marketplace continues to scale?

Yes, sure. This is Eran. Yes, definitely adding the ability to monetize through our marketplace is on our roadmap going forward. We don't have exact dates, but probably beginning of next year. That's kind of the timeline. Again, we keep investing into the marketplace, adding many more features. We've seen those big partners that go on apps, and overall, we see much more adoption within the marketplace, more apps being built, and more users installing those applications. We have many features that we plan to add to that marketplace, as I mentioned, it's a very steep part of how we think about monday as a platform. So we got to invest heavily into that.

Yes, very helpful. Thank you.

Thank you. Our next question comes from Brent Thill of Jefferies. Your line is open.

Hi. Thank you. This is John Byun from Brent Thill. I had two questions. First on Workdays, wondering if you're seeing different use cases compared to the use of boards, whether the same users are using both boards and docs. Just if you can give more detail there? And just a quick housekeeping on the share lockup that was mentioned in the press release. Wondering approximately how many shares may be released, I think from the F1? It looks like it was a fairly small amount, but it sounds like it may be more broad-based. Thank you.

Yes. So, hi. It's Roy. I can take the workdocs part. Yes, we have many users that are builders; they build a workflow. For them, it's both like they create a board and connect to a document. Sometimes you create a whole area of work where you have both integrated. The reason we created workdocs is that we wanted to allow people an unstructured way to start work. We see a lot of people just starting with a document; they might write some things and then create a board within that doc, and then it takes off from there. Many people do the exact opposite; they have a board and then the document column, managing documents from the structured to the unstructured. So I think we've really achieved what we wanted, which is a multiplication of abilities effect.

Hi. This is Eliran. Just to make sure that you were asking about the share count? Just to clarify?

No, the release of the share lockup is coming up on Friday.

The rate of the share lockup will be released this Friday, on November 12, with the expiration of the lockup.

Is there a rough number of shares that you expect to be eligible for release? I mean from the F1? I think we're getting some questions that the numbers were fairly small, but it looks like it may be more broad-based. Thank you.

We can't really say. We had two gradual releases along the way, so we can't predict what the release number will be.

Thank you.

Thank you. Our next question comes from Brent Bracelin of Piper Sandler. Your line is open.

Thank you for taking the questions here. Impressed to see another quarter of accelerating growth here, gentlemen. But I'd be curious to hear how the freemium offering is impacting the land motion, top of funnel build? Are you starting to see any kind of conversions to paid yet? Any color on the freemium offering that was launched earlier this year would be helpful. Thanks.

Sure. Hi, this is Eran. As you mentioned, it was a very successful run for us as a company. We’ve seen no negative impact on the conversion. On the other hand, we see a new type of funnel for users. I would say that it's not yet super significant in terms of adding new paying customers because the funnel is very long. But what we do see is that with awareness of our brand, we see more people using the platform in absolute numbers because we get a lot of free counts and individual usage. We feel that over time this will create more exposure for our brand. Conversion rates remain steady. We see that a free funnel is converting over time, but it's still hard to predict how much impact this will have on our bottom line with the company. Overall, it's a very successful step in changing our product, and I'm sure it’s going to have a very positive effect on our brand. Over time, we might see more and more paying customers converting from that free funnel.

Yes, I can also add. It's Roy. We see the free as a base infrastructure to build more. If you give customers something that they can rely on forever for free, you can offer other stuff they can tie into, like forms and other products. So I think it's a base for us to jump into future products, and that's why we're super excited.

Helpful color there. And, Eliran, just one quick clarification. You generated positive free cash flow in the quarter. It's well ahead of a year ahead of schedule there, I guess. How are you thinking about balancing growth here and cash flow? Do you plan to further accelerate investments? Just how do you think about kind of the nice little surprise here on free deposit for this quarter, and how should we think about that going forward?

Thank you, Brent. I anticipated this question. We experienced a significant increase in our annual recurring revenue. Just to remind everyone, our business model relies on upfront payments; 70% of our subscribers pay upfront, while 30% pay monthly. The combination of high revenue growth and efficient collections improved our cash flow. Moving forward, we will continue to adhere to our long-term strategy. Our goal is not to become cash flow positive in the near term or to generate cash. We have stated that we will keep investing aggressively, particularly in marketing campaigns and hiring. This puts us in a great position, and we want to ensure we maintain this momentum. Additionally, because of our strong capital efficiency, for every dollar we spend since we started, we're gaining about three dollars in revenue. We will continue to invest heavily across all areas.

And if I can support what Eran is saying; it's Roy; the plans we have for next year are going to challenge the revenue growth. But we can predict; but we have big plans for next year.

Great to hear. Thanks for the color, guys.

Thank you. Our next question comes from Arjun Bhatia of William Blair. Your line is open.

Yes, perfect. Thank you very much and congrats on a great quarter, guys. I was particularly impressed with the 50k trends. I’m wondering, as you kind of expand your presence as brand awareness builds, and as you see more upmarket traction, whether the profile of the customers that you're attracting has changed. Obviously, customers are willing to spend more. But I’m wondering if the profile is starting to change towards larger enterprises? Or is it too early to see that mix shift in the customer profile at this point?

So yes, sure. We are going to, as we said, focus on customers with 10-plus users. The share of these customers, especially in June, are basically increasing over time in their shelf ARR and also we lend higher. The profiles of these customers are definitely contributing to our net dollar retention rate and growth. In addition to that, we see customers with more than $50k in ARR growing as well. So the combination of customers with 10-plus users plus the group of customers with more than $50k in ARR is becoming the bulk of our customers, and this is what we are pursuing as part of our marketing and sales efforts. We expect this trend to continue. It’s important to say that we don't neglect the smaller customers because they could later become bigger customers. So even if we start with bigger customers, we find the small ones will eventually become the larger ones. Perfect, very helpful. Thank you and congrats again.

Thank you. Our next question comes from Scott Berg of Needham. Your line is open.

Hi, everyone. Thanks for taking my questions, and I apologize for the audio issue earlier. Nice quarter. I guess, I had two questions here, and one revisits a question from a moment ago around enterprise customers. But I wanted to ask the question a different way: as you look at your lands broadly, whether it's a small customer or a large customer today, are your customers landing with a different seat count on initial sales, kind of on average than say, a year ago, right, as the pandemic was really in full force?

Yes. Thank you. So this is Eran. Scott, I think definitely yes. We see a trend where, as I mentioned, a big part of our enterprise strategy is coming to be a reality. We're also seeing larger companies starting from larger deployments within monday. As we can increase our brand awareness and people are more aware of our solution, we see more companies adopting monday, resulting in larger deployments. I think it's also due to the fact that we have proven our product and made it more enterprise-ready, and other changes that we are making to our platform. So definitely, yes. But again, it's both; both bottom-up and larger accounts deploying. But that trend you mentioned, we definitely see it.

Great. I have a follow-up question. I recently heard from a consultant that returning to the office might actually benefit vendors in the space. They believe that being in-person could help teams recognize outdated processes more clearly compared to working from home. Do you think that the shift back to the office could encourage the adoption of tools like monday today, or has the trend towards remote work been more influential over the past year? Thank you.

Hi. It's Roy. What we saw during the shift from work to home was that people were struggling to organize things, and we helped push them to digitize and organize themselves. When they come back, what we see is that it’s easier to adopt a new tool and change things when you are together in an office. Adoption of new tools is easier when you're together, and kind of doubling down on solutions you already have is easier when people are apart.

Scott, maybe just to add to Roy, if you think about what happened in the last few years in the industry in the sector we operate in, definitely there is a secular tailwind and that's momentum with digitization. The fact that whether working remotely or going back to the office, I think these trends will continue to drive further growth in the sector and in our space.

Fantastic. Thanks for taking my questions.

Thank you. Our next question comes from Andrew DeGasperi of Berenberg Capital. Your line is open.

Thanks, Berenberg. Just two questions, if I may. The first one at Elevate, you announced the workdocs release. I was just wondering how does that stack up, for example, with what Microsoft announced last week at Ignite with Loop? How would you say this is an indication that Microsoft is also trying to get into the work management space?

Yes, hi. This is Eran. Yes, I think Microsoft is definitely looking into this market. The disadvantage is that the Microsoft suite is fragmented. You have many tools that can do many things. The benefit of having one platform, one interface where you can manage all aspects of your work is really a game-changer in how users adopt a solution and how they use it. Over time, we're going to see more companies looking into these kinds of capabilities. But I think we're in a very different position in terms of customer adoption. Since we released workdocs, the adoption and usage on our platform have been significant. So this really shows that the combination of the other elements of the platform, the board, the views, the dashboards, with the workdocs is the true game-changer. I don't think the word by itself will make the same impact for our users.

Thanks. That's helpful. And then, secondly, separately on the enterprise wins this quarter. Can you maybe disclose to us how many seats the biggest deals landed with? And if any of the deals you signed in enterprise were wall-to-wall, so to speak, were exclusive?

Yes, so we're seeing thousands of seats lending in and spending within our existing customer base. We are approaching seven-figure transactions, and this is something that we would like to pursue as well. We're seeing constant growth in the number of seats and in the deals we lend within customers.

Yes, and correct me if I'm wrong, but I’m not disclosing wall-to-wall or how many accounts, but we definitely see those as one.

Great, thank you.

Thank you. I'm showing no further questions at this time. Ladies and gentlemen, that does conclude today's conference. Thank you all for participating and have a great day. You may all disconnect.