Tyler Technologies Inc at Goldman Sachs Communications & Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : So Brian, I want to start on the cloud transition, which we've seen pretty consistent metrics over the last year. And I know you've made a lot of progress with hitting milestones. So given the power of your reflection, what do you think has gone well so far? And what do you think has been most challenging?

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : How much of the (inaudible) management piece of this is a customer technology problem, meaning they need to also upgrade technology than to sit around you versus education and process management.

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : Okay. In our observation, there are 1 or 2 critical pieces on pricing and incentives when you're working with customers through a cloud transition. So maybe let's take the 2 pieces separately. First, on pricing, do you feel like you've already gone through the process of optimizing the pricing on your cloud products to create more lifetime value versus your (inaudible) products.

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : Yes. The second part is on incentives. So can you provide more carrots or sticks incentivized customer behavior? And what about for your own sales team? Do you have an incentive that can then encourages them doing it (inaudible).

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : So there is a piece to this, which is government willingness to move to the cloud, government customer willingness to move to cloud. There's also a piece of this, which is broader government willingness to invest in technology. And many of the dynamics you talk about like staffing shortages, I think speak to a broader advantage that Tyler has to be able to cross-sell and continue to increase the value that you're providing to government customers at the time. What is the catalyst path? On paper, it makes so much sense to use Tyler suite of products. In practice when we do the due diligence, the ability for government to adopt technology seems quite painful. And so how do you work to bring the theory into the reality?

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : Well, I think you've also been proactive on building the next pieces of the portfolio. And so speak a little bit to your market analysis and your customer conversations that allow you to identify where the gaps are. And then if you're willing to share with us the 1 or 2 things in the product portfolio that you're most excited about either from an organic or a potential M&A standpoint.

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : I want to approach the M&A question from a competitive angle as well, which is if you think about the characteristics of your business, which are incredibly sticky and you apply a private equity lens. What is the risk that private equity successfully takes some of the point products that you compete against and puts it together in a platform that perhaps on paper can emulate some of the breadth that you have?

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : Absolutely. I want to switch gears and talk a little bit about your comments from the earnings call on pipeline metrics. And specifically RFPs and demos tracking above pre-COVID high. So walk us through the implications for that? How do we think about COVID being a tailwind versus a headwind to your business over the last 3 years? Do you think it's a headwind or a tailwind today? Are there lingering impacts? And can we construct a scenario where returning to record high levels in RFPs and demos means that you may see an acceleration in revenue. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 07, 2023 / 7:15PM, TYL.N - Tyler Technologies Inc at Goldman Sachs Communications & Technology Conference

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : One of the hypotheses that we're stress testing is, does the move to the cloud actually accelerate some of that process with baking off winning vendor selection and ultimately, brownfield replacement. Are you seeing any of that in practice? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 07, 2023 / 7:15PM, TYL.N - Tyler Technologies Inc at Goldman Sachs Communications & Technology Conference

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : How much higher is NRR on the early cloud cohorts relative to...

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : All right. Let's pause there and go to the audience for questions, please. Unidentified Participant You've talked about cross-selling (inaudible) both the product side and sales side. What are the lessons you learned from the time -- comparing the time to the cross-sell resonated versus when it didn't resonate the way you expected it to?

Question: Gabriela Borges - Goldman Sachs Group, Inc., Research Division - Analyst : Excellent. We'll leave it there. Brian, thank you.