Dun & Bradstreet Files for IPO (Part IV)

The is the fourth, and final, blog on Dun & Bradstreet’s upcoming IPO. Dun & Bradstreet (NYSE Ticker: DNB) will be offering 65.75 million shares at an IPO price between $19 and $21.  The offering would raise just over $1.3 billion and value the firm at $8 billion. [Top of Coverage]

North American revenue increased by $12.1 million or 4% (both after and before the effect of foreign exchange) in Q1 2020 vs. Q1 2019.  North American Finance and Risk rose $10.7 million (6%) year-over-year.  Finance Solutions were up $13 roughly million, while Compliance fell approximately $2 million.

North American Sales & Marketing grew revenue by $1.4 million (up 1%) in Q1.  However, $4.9 million of S&MS revenue was attributed to Lattice, which was acquired by Dun & Bradstreet in July 2019.  North American Advanced Marketing Solutions revenue rose $4 million due to increased demand, but D&B Hoovers and the Data.com legacy partnership with Salesforce posted declining revenue.  The Data.com service is being phased out, so the $4 million in quarterly revenue drop was anticipated.  However, the drop of $3 million in quarterly revenue at D&B Hoovers, attributed to lower sales, was surprising.

International revenue fell by $0.2 million in Q1.  International Finance & Risk revenue increased $2.3 million, or 4% (both after and before the effect of foreign exchange) for the three months ended March 31, 2020.  International Sales & Marketing revenue declined $2.3 million, primarily driven by lower product royalties from their WWN alliance.

Annual revenue dropped $139.8 million (8%), but the drop was due to purchase accounting deferred revenue adjustments (9%) due to the take-private transaction and Lattice acquisition.  There also was a one month lag in international revenue reporting due to the take-private transaction resulting in an additional 1.5% drop in revenue.

2019 North American revenue rose by $44.1 million (3%) with increases in both product lines.  The Finance & Risk division increased revenue by $16 million, or 2%.  The Risk & Compliance products grew revenue by $11 million, and the D&B Credibility products contributed an additional $4 million.

2019 North American Sales & Marketing revenue grew $28.1 million (4%), with $17 million in increased revenue from Master Data solutions and $12 million from Lattice, which was acquired at the beginning of Q3.

2019 International revenue fell $3.1 million after the impact of foreign currency but was up 2% before foreign currency impacts of $9.5 million.  “Excluding the impact of foreign exchange, growth of $6.4 million was primarily due to increased revenue in our U.K. market driven by higher demand and usage related to our Finance & Risk solutions, including Risk & Compliance products.”

2019 International revenue was negatively impacted by $1.8 million, mostly in the UK, “as a result of transferring legacy Avention contracts to our WWN alliances pursuant to preexisting agreements governing partner exclusivity in certain territories.”

The filing also provided some color into their 2018 performance vs. 2017 as a private company:

“The increase in Sales & Marketing Solutions reflects increased revenue from new business in our Master Data offerings of approximately $7 million as well as our Audience Solutions products (Visitor Intelligence and Programmatic) of approximately $5 million and Analytics products of approximately $5 million.  The aforementioned increases were partially offset by lower royalty revenue from our Data.com legacy partnership of approximately $7 million and decreased revenue in D&B Hoovers of approximately $5 million.”

Dun & Bradstreet S-1 Filing

Dun & Bradstreet Files for IPO

Dun & Bradstreet filed an S-1 to return to the public markets after being taken private by Black Knight (BKI), Thomas H. Lee Partners, Cannae, and CC Capital eighteen months ago.  Dun & Bradstreet was reorganized and recapitalized with additional debt ($2.5 billion in increased liabilities).  The bookrunners include Goldman Sachs, BofA Securities, J.P. Morgan, and Barclays.

Dun & Bradstreet (NYSE: DNB) will be offering 65.75 million shares at a price between $19 and $21.

The firm will once again be listed under the DNB ticker and will net at least $1.3 billion from the IPO.  The IPO proceeds will be used to “redeem all or a portion of our Series A Preferred Stock that we issued in connection with the Take-Private Transaction.”

Dun & Bradstreet has 135,000 global customers, including 90% of the Fortune 500 and 60% of the Global 500.  Its primary services support risk analysis (credit and supplier risk), marketing, and sales.  Over the past five years, the firm has focused on analytics, Data-as-a-Service (DaaS), Master Data Management, and Audience Solutions (e.g. programmatic, visitor intelligence).  The product line has been built both organically and via acquisition.  Earlier this year, they acquired Orb Intelligence and its AI/ML tools for collecting firmographics and digital business identities.  Last year, they acquired Lattice Engines, a leading Customer Data Platform.

This year, Dun & Bradstreet launched two new services: an ABM platform and an Analytics Studio that combines Dun & Bradstreet company intelligence with customer-owned and alternative data sources.

Dun & Bradstreet offers global services for risk analysis (credit, supplier), Master Data Management, Compliance, B2B DaaS, Prospecting, and Sales Intelligence.  Key products include DNBi, D&B Direct, D&B Credibility, D&B Hoovers, D&B Optimizer, D&B Master Data, D&B Lattice, D&B Audience Targeting, D&B Visitor Intelligence, and First Research.

The firm now focuses on “business decisioning data and analytics,” which “enables companies around the world to improve their business performance.” Dun & Bradstreet’s Data Cloud “fuels solutions and delivers insights that empower customers to accelerate revenue, lower cost, mitigate risk, and transform their businesses.”  Key data assets include the D&B WorldBase file with global company linkage; various analytical risk scores; credit and supplier risk reports; the global D-U-N-S numbering system for companies; country risk reports; industry overviews; and Hoovers company profiles.

The firm continues to invest in its global data.  Dun & Bradstreet listed the following data initiatives:

“- We have significantly increased our investment in the breadth and depth of our data.  We have specifically focused on better utilization of available data, automation of business data research, improvement of identity resolution, expansion of our individual contact database and implementation of tools to monitor and streamline our data supply chain so that we can generate better, more actionable business insights and outcomes for our clients. We are also proactively addressing data quality issues.

– Although we draw from approximately 16,000 proprietary and publicly curated sources, Dun & Bradstreet had historically focused on identifying and collecting a narrow subset of data that was appropriate for specific solutions.  We have since reoriented our approach towards better ingesting all available data to effectively leverage previously disregarded sources of data and thereby improve the consistency, accuracy and predictive power of our solutions.

– We are also expanding the volume of the data we are able to offer.  For example, we have increased D&B Hoover’s premium contact data from approximately five million e-mail contacts to approximately 16 million contacts in our Data Cloud from January 2019 through March 31, 2020, while simultaneously improving the accuracy of those contacts by 250% since the beginning of 2018.  We specifically focused on individuals we consider having significant influence over the buying process at companies that are most important to our clients based on our verified usage analysis.

– We are also expanding our coverage of SMBs and incorporating new, alternative data sets to expand the breadth of companies covered and depth of information we are able to provide clients. As part of this initiative we acquired Orb in January 2020, which allows us to better capture the digital footprint of businesses as well as the digital exhaust that businesses generate.  By incorporating additional data sets into our solutions, we can continue to expand and refine the insights we offer to our clients, which we believe will enhance our competitive advantage.

– We have implemented a data watch program (the “Data Watch Program”) to proactively monitor and repair issues before clients experience them.  Since May 2019, both client issues as well as Data Watch Program issues are now being logged in our data quality repository.  We have identified, logged and resolved a number of issues as a direct result of this initiative and are continuously working to address additional issues.”

Dun & Bradstreet S-1

Dun & Bradstreet has a set of content differentiators.  These include the global D-U-N-S Numbering system; global linkage; financial and risk data for credit, procurement, and compliance functions; First Research industry profiles; and Audience Solutions for programmatic and visitor intelligence.

“Data is only valuable when it drives action that moves an organization towards its goals,” stated the S-1.  “Underpinned by an integrated technology platform, our solutions derive data-driven insights that help clients target, grow, collect, procure, and comply.  We provide clients with both curated bulk data to incorporate into their internal workflows and end-to-end solutions that generate insights from this data through configurable analytics.”


Continue to Part II.

D&B Hoovers Gooses Its Content for Current Users

Spend Capacity is one of three new risk metrics available through D&B Hoovers.

D&B Hoover’s customers are enjoying additional risk scores and industry content through the end of May.  This benefit is perfect timing for adding value to their offering on a short-term basis as it allows customers to test out additional content and functionality for two months at no charge. Sales reps are under great pressure to build and maintain their pipeline through improved targeting and messaging.

Likewise, Relationship Managers at banks are under immense pressure to process CARES PPP (Paycheck Protection Program) across a broad set of pandemic-impacted industries.

Supplementary material includes

  • First Research industry overviews
  • DecisionHQ flags (does the location have purchasing authority?)
  • Spend Capacity (A spend ranking score versus other companies)
  • Growth Trajectory (Will the company grow, shrink, or remain stable over the next 12 to 18 months?)

In Family Trees, a star icon flags locations with purchasing authority.  All three predictive scores are available as search filters in Build a List.

First Research reports [sample] are a set of plain-English industry overviews which help sales reps, Customer Success Managers, and relationship managers who sell and service across a broad set of industries quickly understand industry basics and trends. Core content includes

  • Industry Description: Competitive Landscape; Products, Operations, & Technology; Sales & Marketing; Finance & Regulation; Regional & International Issues; and Human Resources.
  • Top Companies
  • Financials: Industry statistics from the Bureau of Labor Statistics and the US International Trade Commission. Also includes valuation multiples.
  • Industry Forecast: Inforum Forecast
  • Industry Growth Rating
  • Trends & Opportunities
  • Executive Insight: Key Topics by C-level job Function
  • Business Challenges
  • Call Prep Questions: Conversation Starters; Operations, Products, & Facilities; Customers, Marketing, Pricing, & Competition; Regulations, R&D, Imports, & Exports; Organization & Management; Financial Analysis; and Business & Technology Strategies.
  • Industry Indicators
  • Industry Websites
  • Fast Facts

The Call Prep Questions and Executive Insights offer great value to non-experts. If you are a relationship manager or territory rep, you are likely speaking to individuals across many industries on a daily basis. It would be impossible to develop true expertise in all of those industries. These sections help professionals ask intelligent questions and tailor their conversations at the account and persona level.

First Research reports are available as an integrated service in D&B Hoovers, via the D&B Direct API, as a standalone service, and as individual reports.

First Research reports are written at the eight-digit Dun & Bradstreet SIC-code level and associated with company profiles by these codes. They are also available through the Research and Reports module.


Dun & Bradstreet is also offering risk solutions for business and government during the Covid pandemic:

ABM Research Vendors

When conducting account based (ABM) research, it is necessary to develop a broad view of your customers and prospects which includes company, contact, and industry research.   Unfortunately, open web research is quite time-consuming and your sales reps are unlikely to consistently engage in general research, so consider Sales Intelligence vendors with editorial research teams. 

Executive research should go beyond the Leadership page and LinkedIn profiles.  One option is Boardroom Insiders which gathers rich executive profiles on CxOs written by business journalists.

For industry research, look at Vertical IQ, IBISWorld, or First Research.  Vertical IQ and First Research are strong offerings for sales teams that sell broadly across many segments but are not verticalized.  They are written in plain English and include Q&A sections. The content in IBISWorld is more formal but better suited for verticalized teams.

At the company level, consider Dun & Bradstreet Hoovers, InsideView, or DiscoverOrg.  All three provide company and contact profiles, list building, and sales triggers.  D&B Hoovers goes deeper on global coverage, family trees, and industry profiles, DiscoverOrg offers the deepest set of technographics and rich bios, and InsideView provides excellent sales triggers and social media intelligence.

Quora: How do I find a company’s top competitors?

The following is a post I wrote on Quora.


There are a couple of ways.

  • If a US public company, look at its 10-K (annual report). Firms generally discuss their competitors. You can locate the 10-K on a company’s investor site, through sales intelligence vendors, or free Edgar sites.
  • If a private company, look at Owler, a free site (See below). This is crowdsourced so may include firms that aren’t true competitors.
Owler competitor lists are gathered through social voting.
  • Look at sales intelligence services such as D&B Hoovers or InsideView. Hoover’s competitors are editorially generated and include top three flags (see below)
D&B Hoover’s competitor lists are gathered by a team of researchers.
  • Within IT, look at Forrester Wave reports. Another option is technology category searches in PE/VC databases such as DataFox, Crunchbase, Pitchbook, or CB Insights. Keep in mind that companies within the same segment may not be competitors, but partners, customers, etc.
  • Many industries have industry specific market research that includes competitors. A few general market research firms also provide competitors (e.g. MarketLine, Euromonitor, Global Data, and Freedonia). Top Competitors are also available in IBISWorld, Vertical IQ, and First Research.
  • Zoominfo and a few other vendors identify similar companies based upon proximity in articles. This finds competitors, but also customers and partners so should be carefully reviewed.
  • For new technologies or industries, D&B Hoovers offers Conceptual Search which identify companies associated with key phrases (e.g. Marcellus Shale, Obamacare). This is more of an associated companies list and will identify firms in a topical ecosystem. For example, “Harry Potter” identifies studios, publishers, toy makers, theme parks, and thematic tours. (See example below of conceptual search on Marcellus Shale). Conceptual Search lists may be refined by standard prospecting filters such as industry, geography, and size.
D&B Hoover’s Conceptual Search looks for companies associated with specific phrases.
  • If none of these work, use peer list searches (industry code lists) or keyword searches in sales intelligence vendors. If cost is a concern, go to your public library and see if they have ReferenceUSA, AtoZDatabases, or Mergent Online. Each of these allows you to build peer lists based on industry codes, company size, and geography. If you need help, ask for the business or reference librarian to assist.

Dun & Bradstreet Being Taken Private

DNB Logo
Dun & Bradstreet logos

I was going to be writing about yesterday’s #FlipMyFunnel conference keynote given by Terminus CEO Sangram Vajre this morning, but I woke up to news that Dun & Bradstreet is being taken private.  So, I’ll recap Vajre’s discussion of humanizing B2B and the need for authenticity in a later post.

Dun & Bradstreet announced that it will be taken private by CC Capital, Cannae Holdings, and funds affiliated with Thomas H. Lee Partners LP, for $5.38 billion in cash. Shareholders will receive $145 per share, an 18% premium over its Wednesday close. The acquisition includes $1.5 billion in assumed debt.

The deal is subject to shareholder approval and is expected to close within six months.

Dun & Bradstreet has a venerable history going back 177 years.  Employees include several future nineteenth century Presidents.  The firm, however, has struggled in recent years to grow revenues, particularly in its Risk Management Solutions group.  Sales & Marketing Solutions, which makes up a bit over 40% of the company, has posted slow but steady growth.

Dun & Bradstreet has some market leading assets:

  • The D-U-N-S number is the de facto global numbering system for companies.  It is often required for loans and is necessary for bidding on US government contracts.
  • The WorldBase company file contains global linkages, Tradestyles, and credit scores for 300 million active, dormant, and defunct companies making it valuable for credit risk, supplier risk, master data management, research, client onboarding, marketing, and sales.
  • The Global Company Authority (FKA NetProspex) provides global directors, executives, and mid-level managers.
  • D&B Optimizer for Marketing delivers cloud-based data hygiene and enrichment for companies and contacts.
  • D&B Hoovers (FKA Avention) continues to improve with the addition of the WorldBase file, First Research industry overviews, and Global Company Authority file to the Sales Acceleration platform.
  • Digital delivery solutions include the D&B Direct API, connectors for CRM and Marketing Automation platforms, B2B programmatic marketing, and visitor ID (the mapping of anonymous website visitors to their firm).

The company has a strong data foundation and has been shifting delivery of its product line to the cloud, but its sales and marketing products have not had significant growth.  Instead, Dun & Bradstreet has seen companies such as DiscoverOrg, LinkedIn (Sales Navigator), TechTarget, and Zoominfo enjoy most of the growth in the Sales and Marketing Intelligence space.

Funding will be a combination of debt and equity. The deal includes a 45-day “go-shop” period during which alternative offers will be welcome.

Thomas J. Manning will continue as the CEO through the closing of the transaction while James N. Fernandez, a director of the Company since 2004 and Lead Director since February 2018, will continue as the Chairman.

“Today’s announcement is the culmination of a thoughtful and comprehensive review of the value creation opportunities available to the Company as part of a full portfolio and business assessment and exploration of strategic alternatives with multiple financial sponsors. As a result of this process, the Dun & Bradstreet Board of Directors unanimously determined that this all-cash transaction with the Investor Group is in the best interest of our shareholders and our Company,” said Manning.

William P. Foley II, Chairman of Cannae Holdings, said, “In an increasingly data-driven world, Dun & Bradstreet’s insight-driven business model and interconnectivity across industries has positioned the Company for continued success. We are excited to grow the Company, increase operating efficiencies and improve the Dun & Bradstreet customer experience by providing enhanced business solutions.”

D&B WorldBase Reaches 300M Companies

 

Promotional image posted on LinkedIn.
Promotional image posted on LinkedIn.

It was only a few years ago that Dun & Bradstreet’s WorldBase file reached 200 million records, but this week the file hit 300 million active and inactive company profiles.  The dataset is used for sales, marketing, research, master data management, credit risk, and supplier risk products.  It is also licensed to many other vendors (the majority of which are not allowed to publish the provenance of their data). While sales reps do not use inactive companies, they are important for risk products, master data management, compliance, and database cleansing.

Two key features of the WorldBase data set are the D-U-N-S Number, their de facto global numbering system, and global linkages which tie together global company family trees.

The WorldBase file is a key asset for Dun & Bradstreet products such as DNBi, D&B Hoovers, D&B DataVision, and D&B Optimizer.

Congratulations on reaching this milestone, Dun & Bradstreet.

D&B Hoovers Q1 Enhancements

Users can now filter by corporate employee counts or location employee counts. Both numbers appear in the results list.
Users can now filter by corporate employee counts or location employee counts. Both numbers appear in the results list.

Dun & Bradstreet continues to invest in their D&B Hoovers platform with a set of content and functionality enhancements. Since the beginning of the year, Dun & Bradstreet expanded its prospecting selects, added deeper technology and company coverage, tightened its Microsoft Dynamics integration, and increased the number of fields available for export to connectors.

Dun & Bradstreet added a series of new display and screening variables including Employees 1-Year Growth, Area Code Exclusions, and Employee Counts at the company or site level. D&B Hoovers now supports over 175 prospecting variables.

Three additional domestic location filters were also added. The Domestic Ultimate D-U-N-S Number identifies the top location within a country, helping with territory expansion and cross-selling. Related variables include Is Domestic Ultimate (Select for the top national offices) and Domestic Ultimate Company (all children of the Domestic Ultimate Company).

The new selects are generally not available in competitor products.

Avention (now D&B Hoovers) platforms have long supported variables for screening by ultimate parent country and ultimate parent. The new Domestic Ultimate D-U-N-S Number selects expand the options for sales and marketing to target accounts at the country level. Thus, if a company is looking to enter a new market, they can evaluate their ABM account presence within that market and focus sales and marketing campaigns around those prospects.

The Technologies premium offering was also enhanced with coverage expanded to 195 countries, 2.7 million companies, and over 20 million tracked technologies. Technologies are screenable at the vendor and product level and viewable as part of the Technologies in Use report. Dun & Bradstreet did not indicate whether they gathered the data or licensed it from a third-party.

Microsoft Dynamics admins can now set D&B Hoovers to automatically use D-U-N-S Numbers populated by the D&B Optimizer for Microsoft enrichment service.

“This feature eliminates the need for the manual match and selection step that is used to populate records in D&B Hoovers.  Once D-U-N-S Numbers are attached, the records become automatically eligible for de-duplication when sending to CRM.”

  • Phil McWade, Dun & Bradstreet Director of Product Management

D&B Hoovers added 15 additional CRM and MAP export fields including D&B Prescreen score, Franchise Status, Import/Export Status, Manufacturing Status, Owns/Rents, 8 Digit SIC and Description, Latitude and Longitude, Tradestyle, and Square Footage. Most of these variables were added to D&B Hoovers over the past year and are also available for display, screening, and download.

In March, D&B Hoovers added over seven million companies including 6.8 million from Brazil, 360,000 from Argentina, 210,000 from India, and 78,000 from Australia. The Russian Federation and Vietnam also added over 50,000 company profiles. D&B Hoovers now covers 21 million active companies in South America and nearly 129 million global entities.

Dun & Bradstreet CEO Robert Carrigan Steps Down; Q4 Earnings

DNB Hoov Company Profile of DNB
Dun & Bradstreet’s company profile displayed within their D&B Hoover’s product.

Last week, Dun & Bradstreet CEO Robert Carrigan resigned as CEO, board member, and Chairman.  In his absence, Thomas Manning has been appointed Chairman and interim CEO.  Manning has been a board member since 2013 and Lead Director since 2016.  He previously served as the CEO of Cerberus Asia Operations & Advisory Limited, CEO of Capgemini Asia, and CEO of Ernst & Young Consulting Asia. He was also a senior partner with corporate strategy firm Bain & Company where he led the global IT practice in Silicon Valley and Asia.

No reason was given for Carrigan’s departure beyond that it was a mutual decision.

“Over the last four years we have made progress transforming this company. We’ve improved our data and analytics, developed solutions and capabilities to serve new customer use cases, and modernized our products and platforms.  The Board is confident in the strategic direction of the Company, and fully believes that this business can deliver sustainable mid-single digit revenue growth and expanding margins.  Our number one priority is accelerating value creation for shareholders.”

  • Dun & Bradstreet Chairman and interim CEO Thomas Manning

However, the company is not growing revenue and profits quickly enough.  To address the slow growth, the firm engaged McKinsey & Company two months ago in a strategic and operational review “to help us find ways to speed up the time to realize value,” said Manning.  “The first phase of their work validated our strategy and identified barriers to growth and cost opportunities. The next phase of their work will include a full portfolio and business assessment and we are open to considering all options for value creation that may be identified.”

McKinsey validated the basic DaaS strategy around premium company, contact, and risk data.  McKinsey’s primary concern was the “breadth of our offerings and distribution channels” which increased the level of operational complexity.  The updated strategy will look to “simplify and streamline the business.”

Dun & Bradstreet is also looking to “apply more specialization to our selling activities as we go deeper into the sales and marketing space,” said Manning.  “As we expand our sales and marketing value proposition from being primarily a static data supplier to becoming a dynamic player in the digital sales, marketing and advertising space, we are working to make sure that our organization, go-to-market strategy and processes are aligned with that goal.”

The firm hired David Godfrey, who previously ran Global Sales at Gartner, to oversee go-to-market strategy and execution.  He will be reporting into Manning.

James Fernandez, new Lead Director of the Board, said, “As Dun & Bradstreet continues its work to drive sustainable growth, the Board believes now is the right time to transition the Company’s leadership. We are pleased to have a leader of Tom’s caliber and experience to step in as interim CEO. The Board will continue to support the Company, and lend our expertise to the organization and Tom during this transition period as we conduct our search for a permanent successor.”

Q4 Earnings

Q4 earnings increased 3%, but only 1% organically, to $527 million.  Total revenue hit $1.75 billion in 2017 with 83% in the Americas.  The firm maintained expense discipline resulting in a ten-basis point improvement in margins while investing $40 million on initiatives which “transform our technology platforms in order to meet our customers’ modern-day needs,” said CFO Richard Veldran.  “Modernizing delivery of our solutions is a critical component of our strategy.”

Data-as-a-service delivery continues to increase.  Nearly 30% of Americas revenue came via as-a-service solutions “which makes our data stickier and more useful for our customers and drives higher-value revenue.”

Amongst the 2017 initiatives were upgrades to D&B Credit and new D&B Optimizer solutions for Salesforce and Microsoft.

Deferred revenue was up 3% year over year before M&A activity and currency adjustments.  Growth was attributed to D&B Credit, D&B Hoovers Q4, and the D&B Direct API.  President and COO Josh Peirez noted that the D&B Credit Suite revenues were no longer declining and that the company is well-positioned in D&B Credit, D&B Hoovers, and D&B Direct.

“We think we’re well-positioned to address the competitive challenges.  We’re also pleased that McKinsey has validated that opportunity and that strategy and helping us to make sure that we are packaging and bundling these things properly.”

  • Dun & Bradstreet President & COO Josh Peirez

Taxes, which were 31.4% in 2017, are expected to drop to the mid-20s due to the US corporate tax reforms.  The reforms will also allow the firm to repatriate $265 million to reduce debt levels.

No guidance was provided as the firm is beginning their operational review.  Veldran promised more details on the Q1 call.

Dun & Bradstreet raised its quarterly dividend by two cents to $0.5225 per share.

The market reacted very positively to the announcements, driving Dun & Bradstreet’s stock price up nearly 8% after the earnings call.

Segment Growth

Sales & Marketing Solutions (S&MS) rose 4% in the Americas to $240.1 million in Q4.  Growth was led by Sales Acceleration products which rose 9% to $84.3 million.  For the full year, Sales Acceleration grew 10% to $288.4 million in the Americas with the Avention acquisition contributing twelve points of growth.  Legacy Hoover’s drove down organic Sales Acceleration revenue with traditional Hoovers revenue declining by mid-single digits.

Revenue for the new D&B Hoovers service (Dun & Bradstreet content delivered through the Avention platform) increased in 2017.  However, the decline in revenue from the Data.com partnership will result in a decline in 2018 Sales Acceleration revenue.  Data.com generated around $50 million in revenue in 2017 with the firm continuing to sell through August 2017, resulting in a flat year.  Veldran projects a $15 million decline in Data.com revenue.  Dun & Bradstreet is looking to recapture some of that decline as new D&B Hoovers and D&B Optimizer for Salesforce contracts.

Peirez is quite pleased with the trajectory of the D&B Hoovers business.  “We think our products are far better than anything else in market. We continue to see the overwhelming majority of customers that are buying our D&B Hoovers product buying the higher level of the product with the integrations to CRM, so that’s extremely encouraging for us.”

The firm is also moving to migrate its Hoover’s customer base over to D&B Hoovers.  In Q4, more than ten percent of the legacy base moved to the new platform as Dun & Bradstreet “started to move very aggressively in getting the customers upgraded,” said Peirez.  While the D&B Hoovers Suite grew low-single digits in its first year, Peirez expects growth to accelerate in year two.  The company has told users that the legacy platform will be phased out at the end of the year.

Advanced Marketing Solutions grew 2% in Q4 to $155.8 million in the Americas.  For the full year, growth was 2% to $383.9 million.  While revenue was up mid-single digits in H2, the product line was weighed down by H1 weakness.

Outside the Americas, S&MS grew 17% to $16.9 million in Q4.  For the year, S&MS non-Americas revenue rose 18% to $60.4 million.  Growth was driven by Sales Acceleration products, including the acquired Avention product line.  Sales Acceleration products jumped up 24% to $7.5 million in the quarter and 39% to $27.7 million for the year.

The D&B Hoovers Suite rose 26% to $42.6 million in the Americas in Q4 and 22% to $166.5 million.  Outside of the Americas, D&B Hoovers Suite rose from $0.6 million to $5.3 million in Q4 and $3.1 million to $16 million.  While the classic Hoover’s product line had little overseas sales, the new D&B Hoovers product line, built on the Avention platform, benefited from a longstanding presence in the UK, Singapore, Australia, and India.

Dun & Bradstreet Announces Deal with SFDC for Data.com Transition

 

Optimizer for Salesforce supports Account Segmentation by Revenue, Employees, Industry, and Location.
Optimizer for Salesforce supports Account Segmentation by Revenue, Employees, Industry, and Location.

For the past nine months, there has been great ambiguity around the future of Data.com, a pair of AppExchange services which combine the old Jigsaw contact file with Dun & Bradstreet account and industry intelligence.  Salesforce has remained mum throughout with Dun & Bradstreet providing details on their earnings calls.

Dun & Bradstreet CEO Bob Carrigan announced that Dun & Bradstreet and Salesforce will be offering a path forward for Data.com clients. In August, Salesforce Data.com stopped offering D&B content for new clients, but legacy clients continued to receive D&B WorldBase, Hoovers, and First Research insights. However, the long-term direction of Data.com remained ambiguous as service revenues declined due to “natural attrition.” Carrigan announced that the two firms have agreed on a transition plan to migrate Data.com customers to D&B Hoovers and the new D&B Optimizer for Salesforce.

D&B Hoovers represents a significant upgrade for Data.com Prospector customers as they will receive deeper global company and contact coverage than before. Users will have access to a deeper set of global contacts, a broader set of screening variables, and company intelligence including financials, filings, SWOTs, news, sales triggers, and alerts.

Optimizer for Salesforce will launch next week at Dreamforce where Dun & Bradstreet will have a larger presence than in previous years. Product specifics were not provided on the call, but some details were posted on the AppExchange Lightning Data site. D&B Optimizer offers a data management dashboard, account record matching using DUNSMatch logic across eighty variables, segmentation analysis (revenue, employees, industry and location), family tree linkage opportunities, duplicate record management, and out of business flagging.  Updates are made every fifteen days.

D&B Optimizer creates “virtual corporate family trees”
D&B Optimizer creates “virtual corporate family trees”

Optimizer for Salesforce is listed at $22 per user per month, $3 less than Data.com Clean.  It is currently available in the US and UK.

“For organizations to grow, they need actionable and complete data across the entire business to ensure that timely and informed decisions are being made.  D&B Optimizer for Salesforce provides Salesforce customers the ability to get the data they want, when and where they need it, directly within their Salesforce instance. This leads to increased productivity and, ultimately, growth for their businesses.”

  • Derek Slayton, General Manager of Sales and Marketing LOB, Dun & Bradstreet

Not only will Salesforce assist with transitioning clients, but they will also be referring prospects to Dun & Bradstreet. Dun & Bradstreet will recognize the full revenue from these products and own the customer relationships going forward, providing them with greater control over the product, increased revenue, and an end to their disintermediated status on the AppExchange.

According to Dun & Bradstreet CFO Richard Veldran, Salesforce revenue is “in the neighborhood of $50 million, because they’re not selling new on their side.” In the short term, that revenue will decline due to “natural attrition.” However, as customers are converted to D&B solutions, the firm will no longer be on a revenue share basis with Salesforce, resulting in in a revenue upswing.  It should be noted, though, that subscription revenue is ratable over the term of the contract so there will be a delay in this revenue recognition.