Operator: Your next question comes from the line of George Kurosawa with Citi.
George Kurosawa: I’m on for Steve Enders. You called out some Parchment coming in a little better than expected. Maybe just double click on that, kind of what seemed to be working early on here?
Steve Daly: Yes. Well, there’s a couple of things. I think that the need for their products is just as important as it’s been for their traditional Awards product. So we saw some good traction within Awards. In addition, the Pathways products are gaining more and more traction. We see there’s — there are some conversations that we’re able to open up as a combined company that give me some encouragement for the pipeline build in the future that’s coming. So I do feel good about bringing these two companies together, being able to be the only one that can marry the delivery of learning with the evidence of learning and then how that can become much more rich experience and then a record that will follow the student their Comprehensive Learner Record. That message is really resonating and is holding more power as the combined companies than either of us could have stand-alone.
George Kurosawa: That’s great color. And I think you’ve alluded a few times on the call to next quarter being the start of the bigger selling season. Maybe if you just could kind of compare and contrast what you’re seeing on the pipeline side relative to last year and how that informs your confidence going into the season?
Steve Daly: Yes. As we look at the pipeline for this quarter and for Q3, as we keep track of that, we’re trending as was expected. So with our overall new business, we’re seeing the growth that we expected in the pipeline. And then we — from a renewal perspective, we feel very confident about the renewals that we’ve highlighted in our guidance.
Operator: Your next question comes from the line of Devin Au with KeyBanc Capital Markets.
Devin Au: First one I have is on the win-back. Congrats on that one. I know you talked about you guys winning there mainly on the customer service perspective. But I just want to get a little more context on that deal. What solutions do they tack on? And I’m just kind of curious if there are more of these win-back deals in the pipeline in the near term?
Steve Daly: Yes. It was a nice win for us. It’s always good when you can bring somebody back into the fold that left. So as I mentioned in my remarks, they had left us in 2019. They were enticed away from us. And after their experience over the last three or four years, they came back. And the feedback that they gave us was the usability and the experience that they have with Canvas wasn’t matched with the other solutions, as well as the level of service and support that they got was a differentiator for us against our competition. So it is a sweet feeling to have those win-backs. And just to be clear, that is nice. Our biggest opportunity is there’s still quite a bit of greenfield out there with Canvas, and still a big part of the — a big part of the market that’s still kind of cobbling together free tools, and that’s where we believe the biggest growth opportunity for us is over the next several years.
Devin Au: Got it. I appreciate the context there. And then a quick one for Peter. Macro seems to have like downed in the past 90 days, with rates looking to remain elevated longer. But it sounds like the headwinds you’re facing in higher ed was quite consistent from prior quarter. So my question here is, any changes around the macro assumptions being built into your full year guide versus when you initially set the outlook a quarter ago? Just any changes there?
Peter Walker: Yes. Appreciate the question. Our view is there’s been no material changes to the macro environment since we last spoke. So there’s been no changes in our guide as a result of that. We really need to get into our core buying season, and that will tell us if there’s a change in the macro.
Steve Daly: If I would add there, George, that, again, this market is less sensitive to the bigger economic macro trends that are out there, right? This macro backdrop is more related to enrollments and some of the tuition and those types of things than it is the big economic macro. But the nice thing is, because we are a trusted partner, because we’re in talking longer term, that this is part of a bigger, longer-term digital transformation strategy. We get visibility pretty early in those macro trends. So that’s why you kind of see that consistent — consistently, we’re talking about the same trends is because we got early view into those changes that were happening.
Operator: Your next question comes from Terrell Tillman with Truist Securities.
Connor Passarella: Connor Passarella on for Terry. Steve, you mentioned the partner ecosystem a few times in the prepared remarks. You’re at 900 person — partners now. Could you maybe just give us an update on their ability to either directly or indirectly influence business and revenue for Instructure?
Steve Daly: Sure. Yes. It is a — and it’s good to hear from you, Connor. It’s good. It is a nice competitive moat, if you will, because of the size, because of the breadth, whenever we walk into an opportunity, we’re seeing it as a competitive advantage for us in the selling process. So for instance, I think we talked about it a quarter or two ago, for instance, when we won Montana University system. That was because of some — because of technology that was integrated into just into Canvas that allowed us to learn to win that deal. We see it in some of the examples that I gave in my prepared remarks, where we had technology integrations that allowed us to differentiate against competition. So it does continue to be one of those competitive advantages that would be really difficult for our competition to replicate as we go into a selling opportunity.
I would — we did announce in the quarter as well a collaboration with Lucidchart, where their tools are integrated into Canvas and available to our customers for free, as part of the purchase of the LMS. And so again, the advantage that we have as being the market leader by having a huge network of students and teachers that are on our platform gives us some of these advantages that make us more competitive in the selling process.
Connor Passarella: Yes. I appreciate that. Maybe just as a quick follow-up. The University of Manchester win in the U.K. last quarter, I think you called out specifically that would be more of a lighthouse win for the region. I’m just curious on how you’re seeing the activity play out so far post that deal?
Steve Daly: Yes, it is. It’s one of those institutions that other institutions, particularly in the U.K., look towards. And our EMEA team are very happy with the outcome there. We’re using it as part of our selling process. We’re still — we’re early days with them. And so we’ll be able to leverage them even more going into the future. But it really does validate our international strategy and the success that we’re seeing internationally.
