Taylor McGinnis: So last quarter, I know part of the hit was customers who had renewed lower in the past still renewing lower. So now that we’re in the fourth quarter and coming up on lapping some of the bigger layoff activity, just curious for those who did lay off at this time last year, can you comment on how those conversations are progressing? So, are you still seeing them take down seats further? Is that trending better than expected? Would love just any thoughts there?
Cameron Hyzer: Overall, it continues to be a tough environment. We do continue to see customers that renewed at lower levels last year, continuing to have pressure with respect to their purchases this year. So, I’m not convinced that most of the way through October that we’ve seen kind of customers that made really big layoffs last year. So, it’s a little hard to compare for those customers that are — didn’t really get through their cycle of negativity until February or March, where exactly they’re coming out given that those layoffs in many cases happened later in their cycle or particularly for customers that had multiple rounds of layoffs. I don’t know that we’re kind of lapping the easiest comps yet.
Operator: Our next question comes from Raimo Lenschow with Barclays.
Raimo Lenschow: Two quick ones. Cameron, you talked last quarter already about those headwinds that we have till Q1 next year. Compared to your comments last quarter and this quarter, how has your sense changed? Is it about the same, or you expected Q2 slightly better, slightly worse? Where did you come out there? That’s the first question. And second question for James and Henry. If you think about a downturn, usually, everyone is about cost cutting. And then you suffer and you see it now, at the later stages of a downturn, people usually start thinking about, oh, I did my cross-cutting I think about sales and sales growth, again, are we at those conversations at least at the early level yet or not there yet?
Cameron Hyzer: In terms of kind of where we were compared to last quarter, I think we expected the environment to get worse than it has gotten worse. I don’t think we see any trends currently that the operating environment is getting better. And in some instances, I think it’s largely a customer by customer at this point or kind of segment by segment that there are some things that, frankly, I think people are more worried than they were at the end of last quarter.
Henry Schuck: I think the other thing I would add there, Raimo, is if you’re in the boardrooms of private equity or venture capital-backed businesses today, there is not a push for the companies to grow faster. There is a push still for those companies to cut costs and get to — pull profitability forward or to increase profitability. So I don’t think we’ve turned that corner where investors and board members are pushing their private companies to get back to growth. I think they’re still in a — either maintain the cost you’ve cut or continue to cut costs mentality.
Operator: Our next question comes from Brian Peterson with Raymond James.
Unidentified Analyst: This is Johnathan McCary [ph] on for Brian. So I think you mentioned non-software growing at the low-20s clip last quarter. Is that still kind of the right ballpark? And then for that non-software piece of the business, how would you categorize the NRR of that category versus the broader figure?
Cameron Hyzer: So I think as mentioned, the operating environment continues to be challenging and as expected, it was worse than we saw in Q2. That weakness is not just confined to software. Non-software growth did decline. It’s below 20% this year — or this quarter, year-over-year. We do continue to see demand in those non-software industries, particularly on the new business side. And certainly, the retention in non-software is well above what the overall average is, but we continue to see kind of challenges there.
Operator: And our next question comes from Rishi Jaluria with RBC Capital Markets.
Rishi Jaluria: Henry, you talked a little bit about in your prepared remarks, your efforts with both PLG as well as leaning a little bit more on self-service e-commerce capabilities. Can you expand a little bit on what you’re doing there? What kind of a road map will look like? And how early traction or customer reception has been from these initiatives?
Henry Schuck: Yes. I think what we’ve been focused on this year has been really to build the infrastructure and be out in market testing self-service and e-commerce capabilities with our downmarket customer base. And we’ve seen really good traction that our ability to sell in a self-service e-commerce way down market has grown quarter-over-quarter, every quarter this year. And so, we feel really strongly about that as we go into 2024. Today, we’re focusing that offering on the lowest end of the market where we can drive efficiencies by taking a sales rep out of the motion. And then, we’ve built and we’ll continue to build technology onboarding. And so customers can also onboard in a self-service way. We’ve noticed that we’ve been able to meaningfully drive up usage and adoption of our platform with our technology and self-serve onboarding, and we think we can continue to make impacts there.
I’ll tell you, we’re in early innings, but we have a lot of confidence about that product and its ability to drive efficiencies and growth in the down market.
Operator: Our next question comes from Terry Tillman with Truist Securities.
Unidentified Analyst: This is Bobby De [ph] on for Terry. I’m curious, across the different OS solutions, SalesOS, MarketingOS, et cetera, are you all seeing any of the segments more resilient than others related to existing customer activity or new customer wins? Thank you.
Cameron Hyzer: Certainly, as we mentioned before, within the advanced functionality, which is really encompassing functionality outside of the SalesOS and the add-ons to SalesOS, MarketingOS has done really well, and it’s growing. Obviously, that was a newer product in 2022, but is a place where we continue to see growth. We also see, as Henry has mentioned, a lot of growth in our DaaS and enrichment capabilities as well as automation capabilities, which those land either primarily in the OperationsOS or a lot of the automation capabilities, whether that’s Workflows or Engage, et cetera, are part of SalesOS. So I think it’s parts of those OSs that we’re really seeing more interest from customers. And I think as Henry mentioned, part of that is driven by people looking at their data strategies as may be driven through AI or preparation for AI. And part of that is them thinking about the efficiency of their teams and looking to automate where they can.
