Mark Mader: I think, the R&D is paying off well, today. I think what I’d like to see us reach is a much broader penetration. I think on earnings call one or two times ago, someone asked, so Mark, what’s your expectation? And I very quickly snapped back 50%. My expectation is the median customer at Smartsheet should be able to derive value on from multiple products that we sell. So again, back to why I chose to partner with Max on go to market, when you look at the largest software companies in the world, they’re not one trick ponies. They offer value to their customers on multiple dimensions. And what our job is to make that as accessible to as many companies as possible and their users. And I think part of that is what you offer them.
And then the other part of that is how you make it available to them through a pricing and packaging standpoint. So, a big driver will be how we judge the percent penetration of our portfolio into those organizations. The other important part is what’s the contribution per organization? But I think right now we’re not confused on our remit, which is make these things available. Get them into the hands as many people and organizations as possible. When you look at the retention dynamics of the companies that are deeply embedded with multiple products, good things from an NDRR standpoint happen when people are connected on multiple fronts. So again, this is, and it’s not simply done by hiring more people, this is about letting the product pull for you.
And it’s one of the reasons R&D is working so hard on making this happen.
Ethan Bruck: Yeah, it’s a incredibly coaching diet. That makes perfect sense. And maybe for Pete, as you think about, I know we’ve talked about the different layers of conservatism embedded into the guide, but if you were stack rank where you would see some of the biggest areas of outperformance, how would you think about the between just, better macro, some of those Go-To market execution above expectations? Just anything there?
Pete Godbole: So, I think, if you think about what, how I might stack the upside of the different drivers, I’m most excited about the product portfolio that we’re launching in the through the year. We started with the launch in the modernized core application experiences this quarter. And I’m sort of bullish on that. I’m bullish on, the next one, which is the leadership that Max brings in bringing efficiency in our sales and marketing theaters that allow us to go after making our median rep, operate like our top rep and getting that forward. And the third one I would describe is the wild card, which is all these self-directed experiences as we open them up to more products, how is that going to play out in terms of the upside it produces?
So those are my top three. The macro is a wild card, which none of us can actually quite exactly predict and putting a weight on it. It’s always the biggest one. Could it make a change? It could, but I look at the parts and the parts of the puzzle and the pieces we can drive and control.
Ethan Bruck: Got it. Thank you, guys. Appreciate it.
Operator: Next, we’ll move to Josh Baer at Morgan Stanley.
Josh Baer: Great, thanks for the question. I wanted to dig in a little bit as we talk about macro and SMB, you know, what exactly is going on looks like from customer accounts and full churn disclosures like we’re not talking about logo churn, just want to confirm that and then kind of dig in between, is it just seat contraction or less expansion and like what are the actual behaviors of these SMB customers?
Pete Godbole: Yeah, so the, I’ll describe it to you in terms of rank orders so you can sort of stack it up. The number one driver is gross expansions with these customers, like the amount of propensity they have to buy and their current environment they’re operating in. The lesser one after that is we are seeing reductions tick up, but that’s not the major driver. That is a contributor to it, but not in the scale of the first one I mentioned.
Josh Baer: Okay. That’s helpful. And then, I guess, with both of those in mind, like what is — are those users within an organization using other tools, like I know there might not be a direct competitive replacement perspective, but like when faced with tougher budgets and having less gross expansion or some reductions, like what are those users using?
