I think that would be a projection on where the estimate would be there. I don’t want to guide to a specific number. We still are happy. 100% or better for us is great. I still think for the full year of 2024, there can be some improvement there.
Fatima Boolani: Perfect, thank you so much.
Operator: Thank you. One moment for our next question. And that will come from the line of Brent Thill with Jefferies. Your line is open.
Brent Thill: Thanks. Curious if you could just address the demand environment and how you would characterize how customers are feeling today versus six months ago, a year ago, what are you seeing in terms of their overall attitude to spend and how you’re feeling about the pipeline?
Yogesh Gupta: So, Brent, we continue to see, as we even said in our prepared remarks, right, sort of stable, continued demand. It is a — we have a product portfolio that is very much relevant to the businesses, even more so today than it was a year ago, which was even more relevant than the year before and so on, right. As we pick up these new products that address additional areas that we can help them with. So demand remains good. We are not seeing any sort of meaningful change up or down, right. I want to be careful about that, right. I don’t think that people are suddenly going, oh, maybe there will be no recession and therefore let’s spend money like drunken sailors. We’re not seeing that. We’re not expecting that. I think budgets continue to be watched.
I think people are cautious about their spend. But because of our product portfolio, which helps people optimize expenses, run things better, improve efficiency of engineering and development organizations, improve IT operations, improve security, improve the development lifecycle, all those things actually play towards that. So, I think we see more of the same in 2024 as we did in 2023 at this point.
Brent Thill: And on M&A, a number of your peers are saying kind of the same things you’re saying. I’m curious if — is there one or two points that you would add to what’s enabling this M&A environment to pick back up? Is it just more reasonable evaluation? Is it hey, we’ve had such a stall out for so long that it’s just kind of natural pent-up demand? What do you think is causing this now?
Yogesh Gupta: I think, Brent, it’s all of the above. I think that, you know, when you look at — so, one of the examples is VC backed companies, right. If you look at VC backed companies, their main plan is IPO exits, right? And you look at enterprise software IPO exits over the last 24 months. And boy, it is sparse, right? So, if you have a business and you’re a VC and you have a business that is absolutely not a rock star business, you’re not thinking IPO in 2024, right? So the question is, what do you do? You’ve had two years behind you. And 2022 and 2023 were disasters from an IPO perspective. Now, 2024 looks like it’s gone for that kind of a business. And it’s unclear whether business that is growing, let’s say, single digits in revenue is ever going to be able to IPO.
So what do you do, right? So I think people are beginning to get there. And I think that founders who work with these VCs and these VCs who work with founders are slowly sort of saying, look, we really don’t want to fund your next round. And those businesses that need to raise a round, I think are potentially coming to market and I think they are opportunities. So that’s one category. And then the other category is, even other businesses that have been owned by sponsors or other entities for a significant period and they kind of look at it as a can we get some liquidity? So, I think it is a time issue for the investors. For VCs, it is a matter of focusing on their winners and not worrying too much about their [indiscernible] whereas in the case of sponsors, it is some pressure from LPs around liquidity and so on.
So I think those are the pressures that are bringing the size of businesses we are looking at, right, into the market. We are not really looking at extremely large businesses. We look at businesses in general plus or minus 20% of our size, right. We — ideally 15% to 25% of our size is the sweet spot. We’ll go somewhat smaller. We’ll go somewhat bigger, but that’s what we like. And so that’s — in that range, we are seeing quite a bit of activity.
Brent Thill: And then one quick clarification for Anthony. I mean, your margins over the last four, five years have been pretty much a cruise altitude, high 30s, low 40s. Is that still kind of the range of how you’re thinking about running the business, not — maybe not too high so you get growth? But is the high 30, low 40 kind of the right framework to think about for the next couple of years?
Anthony Folger: Yes, I mean, we’re — 39 to 40 for this coming year. We’re not expecting a material change in the margin profile of the business. We’ve always said, we’ll maintain margins better than 35%. I think being in the high 30s is certainly something that is manageable for us and it’s sort of part of our playbook.
