Asana, Inc. (ASAN)

Investor Day 2020

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Sep 10, 2020

In some ways, things are kind of the same. In other ways, the screen's too slow. Well, The good news is we've learned we can do this. Turns out when we're hitting our goals, nobody cares if we're wearing pants. We just need the right tools So our team stays a team. So no matter what comes next, we know we can work better, do better. Hi, everyone. Welcome to Asana Investor Day. I'm Kathryn Blonde, Head of Investor Relations at Asana. I know many of you know me already, and I'm super happy to be a familiar face hosting you for the day. So before we begin, we have a couple of reminders. First, management may be making some forward looking statements. These forward looking statements involve known and unknown risks and uncertainties that may cause our actual results or performance performance to be materially different from those in the forward looking statements. For a more detailed look at our Safe Harbor, please refer to the slide on the screen. Also, we may be referring to non GAAP financial measures. These non GAAP financial measures should not be considered a substitute GAAP financial measures. And a reconciliation of GAAP to non GAAP is available at the end of this presentation. And actually most importantly, as you can see, we're we had to do work from home from the protocol for COVID-nineteen. We just have a few members of our leadership team here and a small production company on-site. And for the safety of all who's involved, we're following strict COVID protocols, including sanitation, temperature checks, masking, social distancing. And the only time that we aren't in mask is when we're on the air. Okay. Well, let me know let me show you who's here today. We have Dustin Moskovitz, our CEO and Co Founder Tim Wan, our Chief Financial Officer Chris Farinacci, our Chief Operating Officer and Alex Hood, our Head of Products. And we all have been wearing masks until this moment. All right. So let me provide a framework for today. Our mission Asana is to help the world's teams work together effortlessly. We value clarity and we prioritize the customer experience in everything we do. So in that same spirit, we thought carefully about how our objectives for this event today would be. We have 3. 1st, we know you need critical information about our company, our business and our products. 2nd, we know you need Q and A. You want to get to know our management, understand what drives our decisions and informs our strategies. And 3rd, we know you need to be in a concise and engaging experience because I'm sure you've been sitting in the same home office for 6 months, sitting probably in the same seat and engaging with the world through this video screen. So from our Asana home office to your home office, thank you for joining us today and hope that this event will accomplish all of those things and provide you a great experience. Okay. Well, let's take a look at the agenda slide. We have 3 major sections. 1st, the overview of Asana and our products. Next, we'll go through our go to market strategy and our culture. And finally, our financial overview. So for each section, we'll have prepared remarks, we'll get some insights from our customers and then of course, we'll take Q and A. Also note that during any point in the program, you can send a private chat to There is a, a chat mechanism on the right side of your screen and you can send me a note. You can queue up your questions and you don't have to wait until the Q and A session to queue up your questions. So feel free to queue that up. All right. Well, before we start our first Q and A session, we'll begin with an overview of the Asana story from our CEO, Dustin Moskovitz followed by a product overview from our product leaders, Dana Barrett and Alex Hood. All important projects in the world have one thing in common. They all involve groups of people coming together to achieve a shared goal. My co founder, Justin and I started thinking about this idea while we were at Facebook. I was leading the engineering team there and we're both just consistently shocked and frustrated by how difficult it was to coordinate everyone. We're wasting an incredible amount of time in meetings and these long email back and forths. And so we ended up building an internal tool to help everyone track their work and the results were really great. Almost immediately after introducing it, everyone was much more on the same page about our plans and the time spent on the coordination itself, the work about work dropped off a cliff. We recognize that the problem is universal and so we left Facebook and created Asana to bring the solutions to the rest of the world. We launched the paid product in April 2012 and we've been growing quickly ever since. Just 8 years later, we've grown to over 82,000 paying 190 countries. Last year revenue grew 86% to 143,000,000 dollars We've been helping to introduce the world to the new work management category and analysts have consistently recognized us as a leader in that space. Everything we do here is grounded in a focus on our mission, which is to help the world's teams work together effortlessly. So if we succeed at our mission, the work we do here can make every one of those groups vastly more leveraged and effective. To understand how to deliver that value, it's vital that we have an extremely well functioning team ourselves. That gives us more credibility when we talk about best practices for teamwork in the market and it allows us to intelligently integrate those practices directly into our product as we learn and grow. And of course, it helps us achieve our own business objectives, which is the same value that we're working to create for our customers. With that in mind, one of the most important values at Asana is clarity. We strive to ensure that everyone on the team understands their responsibilities, the tasks and processes that fulfill them and how they relate to the surrounding work and ultimately to the strategy and mission of the company. When we succeed, it means that everyone understands where they should focus their energy, so they can stay in flow. They work more effectively because they understand the plan. And importantly, they're more engaged with their work because they understand why it matters and exactly what's expected of them. So that clarity is a key way that we're able to move really quickly. We're proud of that today Asana is often recognized as an outlier work culture, But if we succeeded our mission, that means helping every one of our customers similarly become the best possible versions of themselves. So now let me tell you about work management. The biggest thing slowing down teams today is the fact that they now spend more time coordinating work than actually doing it. This is a graph representing data from a survey of over 10,000 knowledge workers and it shows that the average one is spending most of their time about 60% coordinating work. So that means they only have 40% of their time left to spend on the strategic and role specific work that results for the business. Imagine how much faster the world's teams could be if we could increase that number. So how did it get this bad? In recent years, we've seen a huge increase in collaboration, thanks to the introduction of powerful communication tools. But productivity has only increased very modestly in comparison. So all this collaboration generates a fire hose of information, but people lack clarity about what's most important and where they should focus their attention. This makes team leaders feel disorganized and they worry about missing deadlines and having work fall through the cracks and everyone on the team feels overwhelmed with requests. They aren't sure if they're working on the right things or if they're doing a good job. We designed Asana to solve this problem. Effective team collaboration includes the 3 Cs, content, communication and coordination. Teams have invested heavily in technology for the first two categories, but in most cases they haven't invested in the coordination layer. Coordination is all about clearly answering the question, who is doing what by when. Teams that haven't invested in that coordination layer have had to resort to makeshift devices to coordinate their work. Things like long status update meetings, shared spreadsheets and sticky notes on whiteboards. But those solutions just don't scale. Spreadsheets were designed for financial modeling, not for team orchestration. And other teams have invested in traditional project management tools, but those require special training. So they aren't usually used beyond professional project managers in a centralized part of the work. And more importantly, they're not connected to the underlying work. They aren't up to date enough to be the source of truth about what's actually happening in a team. So that's why we built Asana. Asana is one of the pioneers of work management, an entirely new category of software designed to give teams clarity of plan, process and responsibility. So we're solving the problem of team coordination and creating a living system of clarity for work by bringing teams structured and unstructured work data together. We're helping our customers create a complete map for how work happens in their organization. Asana helps teams orchestrate their work. They use Asana to manage everything from employee onboarding to product launches to marketing campaigns. Each team member can see the work in whatever view they prefer. For example, a task list, a Kanban board or a Gantt chart. Asana provides a suite of features to help teams plan, manage and automate their workflows. And finally, since workflows often span several applications, Asana serves as an integration hub with the other apps teams use to complete their work. We support over 100 integrations, including products from Microsoft, Google, Salesforce, Atlassian, Adobe, Dropbox and more. The work graph data model enables our core differentiator, a complete fully connected, accurate and up to date map of the work happening in your organization. The work graph represents all the units of work like tasks, ideas, goals, agenda items, information about that work like relevant conversations, files and status information and how it all fits together. By keeping all that data in one place, you get a single source of truth about project progress, which means teams eliminate the work about work previously required to share information. So the big picture of our vision is to create a platform that combines human and machine intelligence to automate all the work about work that makes working together so difficult today. And that means giving teams time back for the strategic and role specific work that drives results. Our North Star for that vision is what we call the pyramid of clarity. We know organizations work best when everyone on the team has clarity on the company's mission, its objectives, the projects and strategic initiatives needed to achieve those objectives and who's responsible for each individual task. So everyone on the team should know what their team is trying to accomplish and how their own work ladders up into those higher level goals. We built Asana because the work people do together matters. We're proud of how often teams tell us that Asana gives them the clarity to make their work today more effortless and we feel like we're just getting started. Hi, I'm Dana. I'm the Head of Product Marketing at Asana. I'm going to walk you through a product demo to show you how Asana gives teams clarity at every level of the organization. Meet Chris. He's a graphic designer at Portoa, a fictional company. He used to struggle to keep his work organized, but since Portoah started using Asana, coordination has become so much easier. This is the Asana home screen where Chris starts his day. It brings together his most important tasks and projects. From here, he can access my tasks. Asana's work graph gathers all of Chris' tasks in one place, helping him stay organized. Here, we see a task, the main unit of work. It begins with an assignee and due date. This is the essential information every knowledge worker needs to be successful. To answer the question, who is doing what by when? Further down, we can find details about what Chris needs to do to complete this task. All the content he needs is right there, thanks to our native integrations with services like Google Drive, OneDrive and Box. Gone are the days of searching for files. Tasks are also where collaboration happens. Teams can discuss and share ideas to drive work forward. Now that we've seen how My Tasks helps each individual, let's move up the pyramid of clarity and see how teams use Asana for their projects. Meet Michelle. She's the Marketing Director at Portoa. Michelle's team is working on this year's brand campaign. Here is the campaign project in Asana. Anyone on the team can see the different tasks for this project in the list view. But this is just one of the views that the team can use to organize a project. They can also see this project as a Kanban board. In this view, tasks are represented as cards. Each column shows what stage of completion each unit of work is in. And here is a timeline view. In this view, Asana helps teams see task dependencies. Before, teammates would need to schedule a meeting to update due dates and get on the same page. But now it's automatically done for them in Asana. And in the calendar view, teams can easily see key dates and manage deadlines. With these views, teams can organize their work data in the way that best suits each project. This helps them stay coordinated and better collaborate. Conversations that impact projects can happen anywhere, in email, meetings or chat, on desktop or mobile. Asana helps teams capture these updates so that information doesn't get lost. Let's take this message that Michelle just got over Slack as an example. Michelle and her colleagues align on the assets the marketing team will need for the brand campaign. With Asana's integration with Slack, Michelle can create a task based on this chat and add it to the campaign project. But since this task also requires support from the creative production team, Michelle multi homes it to both the brand campaign and the creative production projects. This multi homing functionality is a unique differentiator that is enabled by Asana's work graph. Now teams working in either project know next steps and can stay on the same page. Asana automatically assigns this creative request to a graphic designer, in this case, Chris. Designers like Chris do their best work when they can focus on their craft. With the Asana for Adobe Creative Cloud Integration, Chris can work in one of his favorite tools with important context on his current task right at hand. This means less time searching for details in e mails and spreadsheets and more time for the work itself. Once Chris has finished his work on the creative request for the brand campaign, he attaches the requested asset to his assigned task. Asana automatically kicks off the review and approval process. Let's jump over to Michelle, the Marketing Director, to see how this works. Asana gives Michelle everything she needs to review Chris' work, The image, collaboration history and the ability to approve over any device, anywhere. With Asana, teams can have fun and can celebrate a job well done. Let's move up the pyramid. Asana helps entire Portfolios. Portfolios helps teams track the status and progress of multiple projects at once. Michelle can view resource allocations across the team and with a simple click and drag reassign tasks to create better balance. Thanks to the work graph and Asana reporting, she has visibility into the status of all of the team's projects. And with our integrations with advanced analytics tools like Microsoft Power BI and Tableau, organizations gather important insights that can drive business outcomes. This takes us to the top of the pyramid where leaders can track company goals and all the work needed to achieve them. From individual productivity to company objectives, Asana gives teams a living system of record. With this, organizations have greater confidence and clarity, so they can move faster and accomplish more. I'm Alex Hood. I'm the Head of Product here at Asana. I lead the teams who are thinking about the future of work and how we can build it to really change the way that folks are working for the better. The majority of our R and D efforts over the last decade have been to build out the features based on the Work Graph technology. This core architecture allows us to offer benefits that others can't. Asana solves the problem of work about work in some unique ways. Number 1, it's very easy to use. So if a team lead selects Asana, their team can get on board and get traction, create shared victories best. Number 2, we actually care about individuals and there's a broad set of tools in there that allow for individuals to be clear on what they need to do and their priorities. And number 3, it actually helps link strategy and execution. Other work management solutions force teams to work in one particular way called the container model. And that's where a project lives only one construct, a single kanban or a single spreadsheet. And it only works for 1 project. That's a big inhibitor. At Asana, we have something different. We have a unique data structure called the work graph. The work graph does 2 things. Number 1, it allows anyone to see how the project or projects are coming together in any view they want, timeline, kanban, spreadsheet view. Secondarily, it allows a single task to live in multiple different projects. And that just means that teams who are working interdependently can then have the information that they need in their own workflow, in their own form. Our product vision is in 2 phases. The first phase is what we've been working on to date. That is building the pyramid of clarity powered by the graph. That means everybody knows who's doing what by when, up, down and across organizations. When that work graph is created, we're able to have our 2nd piece of our product vision. And that's to become the navigation system for organizations. That navigation system allows organizations to set their goal, get turn by turn guidance on how to get to that goal as fast as possible and then automate the core workflows that teams struggle with to get that work done. The great thing is that customers see value. You look on Twitter, you meet customers for real. They adopt Asana and it's changing the way they work. And then they can't imagine going back to the old way. That for me is very satisfying and for our team gets them fired up every morning. I am Christina Campbell and I am a Design Operations Manager at Slack. Slack is a channel based messaging platform for the enterprise. I keep people informed by using Slack and Asana. I use Slack for communication, keeping people up to date and I see Asana more as our holy gorilla of information. It's where people can always refer back to for any project information. What is the brief, any dates, any helpful docs, we stick that in Asana. Asana usually gets adopted by design first because it's gorgeous, it's user intuitive. Of course, design is on it. They love it. Engineering was using a more traditional project management tool. And once they saw what was possible in Asana, they really got excited. And what was really exciting for them was ability to collaborate with other teams. What used to take us 1 week to get all together and agree on a timeline and now it takes us 2 days. Before Asana project management was kind of painful. And now that our team is on Asana portfolios, I'm able to get them to look just in one place. The thing I really love about Asana and the way our teams are truly collaborating on one tool, it's not about launching more projects. It's about launching complex projects and really being able to see the issues ahead of time. When we're talking about launching global campaigns, that means not only are we talking about 3 teams, we're not talking about 6 teams. And then we're talking about different languages. So we need to be able to look to one place and be speaking the same language. I love Asana because it's made my life easier. It's made my team's life easier. I've been able to really share efficiencies with teams and get them excited about process, which is very hard to do. Asana is the tool that helps me bring projects to life and then keep moving on to creating bigger and better and more complex projects. I love hearing our customers talk about Asana, especially when they talk about how complexity is solved and managed and enables and Asana enables them to make better decisions. All right. So let's move to Q and A. We've got Dustin Namaskowitz and Alex Hood here. All right. Okay. Our questions are queuing up. Dustin, the first question is for you. Why is work management important and why is it mission critical, especially in a tough macroeconomic environment? Yes. Thanks, Catherine. So our research shows that the average knowledge worker is spending 60% of their time on what we call work about work. And if you think that that's just sort of an intrinsic part of collaboration, then you might not think something like work management is critical. That's just a tax that everyone has to pay. But if you think we have any hope of chipping away at that pie, then there's an incredible opportunity to make your teams more effective and more productive. We really think that effective collaboration involves what we call the 3 Cs. So content, communication and coordination. And in most cases, teams have invested heavily in technology for the first two categories, content and communications, but they haven't invested in that coordination layer. Everybody has to do coordination, but without a product like Asana, they're just doing it in long meetings and email back and forths and shared spreadsheets and it's not effective. And when you're doing it that way, the other two categories can actually be counterproductive because all your work. But once you add a product like Asana, then everything works really well together and it really amplifies the power of each of those technologies and the sun becomes you know, more than, sorry, the whole becomes more than the sum of the parts. I know what you meant. Yeah. Okay. The next question, actually another one for you, Dustin. You mentioned that the work graph is your key differentiator because it enables many different views and workflows. Can you elaborate on that? What makes Asana unique and different? Sure. So the work graph is really enabling what we think of as our key differentiator, which is a complete, fully connected, up to date and accurate map of the work in your organization. The alternative to this is a container model where work lives in silos and teams organize around discrete projects. The work graph isn't a concept in the product itself. So the way we hear this play back from customers is that it's really enabling the best customer experience and it works for the entire organization. When you think about it, the most important coordination use cases are almost always cross functional in nature. So for example, to produce this Investor Day involved a huge collaboration between us, our marketing teams, the finance teams and really a shocking amount of contribution from the legal teams as well, as you can imagine. And they're all working together, organized around the same work. And so the work craft empowers teams to work well cross functionally because it enables many different views and workflows to be built around the same underlying units of work. That means each of those teams was able to build the views that made sense for their workflows and their context. And Asana itself was able to tailor the best project experience really nimble and scalable. It's easy to use and adopt when you're getting started, but it also has powerful enterprise capabilities that a customer can as they deepen their engagement. And finally, the work graph connects work top to bottom from the atomic unit of tasks all the way up to the highest level objectives and the mission of the company. That creates dynamic clarity for the entire organization and really connects strategy and execution for the first time. Wow, architecture does matter. Okay, the next question, Alex, can you talk about your integration strategy and how you work with other products and platforms? Sure. As Dustin said, the best teams have three things. They have a place where the communications goes on. They have a place where their content lives. And then there's a coordination layer. That's where purpose, plan and responsibility lives. That's what Asana is. It's critical, though, that the plan of record be deeply integrated where communication is occurring and where all that content and context lives so that people can do their jobs well. So an example is our Slack or Teams integration. When there's chat going on amongst a team, there could be tasks that come up or a to the plan of record that everybody's looking at. So Asana ends up being very complementary to the existing tools out there where teams house their content in communications. I'll also give a slightly more technical answer. The work graph data model is the important infrastructure that powers our system. It does something uniquely well. It takes the unstructured data about work and makes it structured. Our integrations allow us to assemble much more of that unstructured data about work, which allows us to create a much more active real time map of how work is done in an organization, allowing the tool to be more powerful and ultimately intelligent. Wonderful. Okay, Akhsa. One more question for you. What does your organization look like? And is there anything unique about the way you approach your productization? Great question. There might be there's 2 things I think I would mention about my organization makes it distinct. So the first is customer focus. We have a robust user research team. And usually, that ends up being a service organization that lives under another organization like, say, design. In Asana, product management makes the decisions on what we build. Design, which creates the experience itself and user research are peers. That means that when the road map is being created, the customer and the most important insights are there, have a seat at the table, so we're making the right decisions on top on behalf of our customer. 2nd thing I'd mention is design. We have a world class design team that's made up of folks from various backgrounds, but many have backgrounds in the best in class, best of breed consumer applications. And that's because Sana needs to be very easy to adopt. And we care about how the customer experience manifests itself. That's how we grow. Actually, I see the next question, a couple questions down is actually a great follow-up to what you just said. This question is about the individual experience. Alex, the first thing you always highlight, so they must have with you before, is how Asana prioritizes the individual experience. Why is that so important in an enterprise software business? Yeah, I mean, great, great question. The individual experience, I mean, having the folks who end up using the product feel delight in using it is really important. I mean, if the platform is meant to be real time and the real time source of truth across an organization. And it's got to be easy to use. And that's what fuels individuals to add their work to the plan of record. Also, we are taking the great things that exist in project management offices. The ability to better organize work. We're democratizing that for the world's information workers, right? And that means that project plans, the plan of record, who's doing what by when, the context around tasks, that is co created. So it's really imperative that the individual feels like they get massive benefit from Asana. Secondarily though, that focus on the individual experience drives growth. When the individuals who are on a team, they get together, they have a shared victory, they knocked out all that all those cycles around trying to determine the plan of record, they have a win. That brings them together and they want to have a shared victory like that again. So the next team that they're on, they use Asana or recommend Asana to other folks. That's the flywheel of our growth. Chris Veronacci, I'm sure, is going to talk about that more. But teams that succeed end up being the best marketing tool for Asana as we grow. That's great. I actually see a great question that comes up pretty frequently when people are still getting up to speed on our business. So let's put this one out for you, Alex. How are you different than other work collaboration software tools, whether it's email, Slack or any other tool that a knowledge worker traditionally uses? Ed, do you want to take this through? Yeah. I can start, maybe. Yeah. So So I already said this a little bit earlier, but we really think collaboration involves the 3 Cs. So content, communication and coordination. And so email and Slack really fit into that communication category. They're absolutely essential to collaboration. We use Slack especially very heavily ourselves. But it doesn't help they don't help you answer the coordination question. So coordination question is who is doing what by when? What steps are left between now and accomplishing our next milestone? Who's responsible for each of those steps? And when are they expected to be done? And communication tools are great when you're discussing things, but you have to go through the entire history of your conversations in order to answer those questions. So it's really tedious, and it doesn't represent the current source of truth on what's actually happening with a project in progress. So we really think that these things work really well together. And in fact, you just heard from Slack in the earlier part of our investor video about how they use Asana to make their work more effective. Yes. This is an emerging category. Massive TAM, massive customer pain point, and some of the solutions are starting to emerge. Here's what we're seeing. We see that spreadsheet and spreadsheets and email don't scale. There are a series of project management tools out there really made for single team, single project. But the pain that we're solving in this category is cross functional in nature. So those those those, those types of solutions don't scale well. There's also, industry specific, functional specific solutions out there. And those are work very well for, you know, bespoke needs of organizations that are functional, say software development or or others. And those are those, while great for that function, don't enable that cross functional drivership, cross functional success, which is really how work gets done. And then the last piece is, there's, there is existing project management software out there. And that is used largely by project management offices, not by the folks who are really becoming more and more accountable for not only doing the work, but managing the work and having accountability that the work gets done across their team. Even though they don't have authority, they have that accountability. So to have the benefits of knowing who's doing what by when, to take that coordination layer off of the plate of That actually leads right into this next question. In fact, there's 2 follow ups to your recent answer. 1 is, is there always a project manager role in Asana or can peers work with another without a project manager? Yes. Well, often how technology emerges is that humans do work. And then technology understands the benefits that those humans are creating and augments that, right? So project managers have a great function because they make sure trains are running on time. They create clarity of who's doing what by when. We keep saying that phrase, the purpose, plan and responsibility. We're democratizing that. So a project manager certainly can use Asana and have a lot of success with their team. And often, our biggest advocates are project managers who want to scale up their ability to have impact. But also, a project manager is not required for Asana to be successful. Team creating that plan. They're getting that work done. They're seeing the bird's eye view. They have their own distinct views of the plan and they can see how their pieces fit together, without a human who's helping them do that. And that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, without a human who's helping them do that. And that's really the benefit that we're offering. Makes sense. This next question is actually a double click into your point about the capabilities in cross functional capabilities. This question is, can you explain what multi homing is and how someone uses it? Sure. You want me to take it? Sure. Yeah. Multi homing is, one of these delightful moments in the product. When you're using Asana and you experience it for the first time, that's the, oh, I see what they're doing here. We describe it as the work graph data model, that's the technical version of it. What it really is is, hey, say a marketing team has a has a cross functional project that they're running. They've got a task, which is to get a website done as a project. And then there's tasks in there around design. Well, because they're creating those design tasks in the marketing team's construct, on their pages, in their domain, in their workflow, that that means that the design team has to come over to the marketing team's place and work within their workflow. And you know, that's a source of friction in work about work. What often then happens is that the design team is like, you know what, let's just make a copy of all those tasks that live in the marketing team's domain and we'll put that into our own design workflow. And then you get those version control issues, work about work and friction just, you know, manifests from that, right? So multi honing is that same task around designing the website is in the marketing side and is clickable, available in the designer's workflow too. Same bit of data, same exact test lives in 2 workflows. That technological innovation there, that data structure that we started with here at Asana is enormously powerful because the world's projects are cross functional. The biggest pain points are around handoffs, things not falling through the cracks. That's an example of how the work graph data model delivers clarity. And if I may add on to that since, you know, I think this is really important. Once you've broken out of that container model, you also have the opportunity to multi home that in as many places as you want. So in addition to the marketing and design team, you might, for example, multi home it into the designer might multi home it into a meeting agenda with their manager, so they can discuss it when they have their one on one. And additionally, Asana has, we talked earlier about the importance of individual experience. There's a great sort of personal individual work management tool built inside Asana for every one of our users. And so something that is really quite unique to our product. And it's basically another version of multi homing. So not only is it in the project, but it's in your personal workspace organized your way. So you can say, this is the stuff I'm going to do today or maybe this is the stuff I'm going to do next time I'm in a certain location. And that's really powerful and gives people a lot of control over how they organize themselves. Oh, yeah. The personal view is a very unique view for us. That's right. Yes. That personal view is just there's the kanban view and the calendar view and the portfolio view. Basically, it's basically the same underlying data that's painted across unique bespoke views for every individual, is the power of the work graph. Fantastic. Okay. Well, Dustin, you mentioned that Investor Day was an example project. So I think that this is where this question comes from as well. Dustin, as you prepared for this Investor Day, were you were your outside partners able to work with internal people on the Investor Day project? And how are you using are you using Asana for the direct listing project? We decided to just use spreadsheets for the direct listing. We're using Asana very extensively, including with our external partners like our video production agency. And they're able to just join as guests inside our workspace and collaborate in the same project views that we're using, as well as create their own if they'd like to. So it works really well both internally and externally. And then for the direct listing, I mean, we've been working on this for 6 or 8 months already and have a number of projects and a number of portfolios dedicated to this project. And it made it seem frankly much more straightforward. So I've never had the opportunity to do this before. Very few people have done direct listings at all. But we were able to just lay out the plan, know exactly who is responsible for each piece and get to work. Perfect. Let's see. Another one from the audience. The work graph model is a terrific concept, but does Asana really have the right or best perch within the enterprise to actually assemble and manage the flow? Yes. Well, I think traditional enterprise software is sold tops down. That is software is sold tops down. That is sold to folks who may not ever use it. Asana was created so that created starting with tasks and projects. And that means it was really created for people trying to get work done on the ground, individual contributors working together maybe with a team lead. So Asana is adopted bottoms up by teams themselves. That positions it perfectly because the rest of the organization then relies on that information about the work going on that's added to the work graph by individual individual contributors. Then you can have bird's eye views across maybe matrix organizations, all different views of that same work that's going on. If you started at the top, then you need to have a lot of folks running around assembling that information that's work about work. But by starting at the bottom, you're positioned to have the map of how work gets done, the work graph actually created and co created by teams. That's what makes it enormously powerful. Wonderful. I think we have time for two more questions. So what are the top 2 or 3 product related selection criteria that customers have? Yeah, good question. The when folks try out Asana, they need to be convinced pretty easily that their team is going to have success in it. And that's why we focus so much on design, the customer experience and ease of use. Because if a team lead is trying something out, they're kind of putting themselves on the line a bit, like I'm taking a risk to get my team to adopt this thing. I only have so many chips to wager to ask them to do things. And I'm going to put my chip on Asana. That means that Asana needs to show benefit quickly for all the team members. Team members need to be able to see to really have the chaos of how they worked before turn into clarity. They need to be able to see work get done, maybe see their first like nag free project completion or test completion in the program. And then they needed to see the results. We got this done easier, more quickly, without less work with less work about work because of Asana. That adoption experience, ease of use ends up being, you know, a competitive differentiator and a must have for those who are shopping in this brand new category of work management. So the world's not just top down, it's changing bottom up. Exactly. Wonderful. All right. I think we have one more question for this last section. This is really a good one to end on. Dustin, what keeps you up at night from a competitive market dynamic standpoint? What are the things that give you a sustainable competitive advantage? Great. Thanks. So we talked some about the fact that our addressable market is really a 1,000,000,000 knowledge workers globally. And the vast majority of them are still doing coordination through the status quo of, you know, long email threads and meetings and shared spreadsheets. And so what keeps me up at night is less actually our drug competitors getting to that market first and more of this idea that the status quo keeps getting a little better. So emails and documents are a lot more powerful than they were 20 years And I think there's somewhat of a risk that this lulls potential customers into a sense of complacency because they see some of their coordination pains getting solved and they lose the motivation to seek out what could be radically better. I've definitely worried about that less and less over time as we've had as we've seen the category develop and we've had more time to tell our story. But nonetheless, that's the thing I tend to think about the most. In terms of our direct competitors, what gives us a sustainable advantage is the fact that we have a deep, highly differentiated vision built around the work graph model that we've been talking about. So flexibility of that model means that we're capable of scaling from small teams all the way up to large enterprise organizations. So it's easy to use and adopt, but it's also extremely flexible, customizable and powerful. And we've been building and strengthening that advantage over the past 10 years as we've invested 100 of 1,000,000 of dollars in R and D. So customers love the Asana product experience today and they rely on it for critical workflows. So it's extremely sticky. We have a large and quickly growing community of Asana evangelists all over the world that help us drive awareness and adoption. And the ones that have been with us for a while can see that the product keeps getting better and better. So we have the credibility to keep building and delivering that vision for the long run. Thank you. That's great. I mean, and that's actually a perfect segue since our product and our go to market strategies are married together. Let's segue into the next section. Thank you, Dustin. Thank you, Alex. And let's go to some prepared remarks from our team, starting with Chris Farinacci, our Chief Operating Officer. My name is Chris Farinacci. I'm the COO at Asana, and I'm responsible for running the business. I've been in enterprise software for 28 years. Most recently, I was at Google running marketing for their cloud and education businesses. These days, I think everyone realizes they don't have clarity, particularly post COVID. They spend all their time trying to solve it with emails and sticky notes in meetings instead of knowing like you don't actually need to do all that stuff. You could spend way more time on your craft. Sauna has a large and diverse customer base globally across regions and countries from early adopters into mainstream verticals and also broadly across use cases and functions within a company. Our customers span from really small companies to the world's largest. Asana has more than 82,000 paying customers, many with multiple teams and some with hundreds of teams using Asana. And that's on top of a base of more than 3,500,000 free activated accounts. We have more than 1,300,000 paying users. Regionally, 40% of our revenue comes from our customer base outside the United States, and we have users in 190 countries. Let me tell you about some of our amazing customers. So Autodesk creates software for people who make things. They use Asana for general work and project management across sales, marketing and operations. The global customer events team tracks all their event timelines and same information. Wiesemann, headquartered in Germany, is a leading manufacturer of heating and refrigeration systems with over 12,000 global employees. Their CEO, Max Wiesemann, initiated a company wide digital transformation initiative to bring team agility to the whole company with Asana as its foundation. We're also wall to wall in companies like FireClay Tile and G2. FireClay Tile, a leading tile manufacturer, uses Asana to centralize and manage all their work from strategic planning to team meetings. G2 is a leading B2B software review site that uses Asana companywide to help them hit their revenue, review and website traffic goals. We reach and support our customers by an intentionally hybrid self-service and direct sales business model. This is a bottoms up seed, land and expand experience across the customer journey. Seed corresponds to our self-service business, where we see high volumes of small free and paid teams adopt across companies of all sizes. Our land and expand motions then correspond to our direct sales business. Hi, I'm Dave. I'm the Head of Marketing. Hi, I'm O. J. I run our sales and partnerships teams. Our self-service and direct sales models work together. And it's how we reach millions of teams all over the world and turn them into successful customers. Self-service is our high velocity engine. Every month, millions of visitors come to asana.com and hundreds of thousands of people sign up for the product. Anybody can sign up for a free trial and get started within minutes. Teams pay us a subscription, which is priced based off of the number of users they have and the level of service. And that determines what features they have to. The beauty of our model is as teams collaborate, they add more people, as their needs get more complex, they need additional premium features and their investment with us grows. Our lead scoring algorithms use that data to identify which teams and which companies represent the best opportunity to land and expand through our direct sales motion. Yeah, the self serve model gives us a massive edge in market development. It helps develop our brand before we even spend a penny in that market. Then we can bring in our regional sales and marketing and customer success teams that actually accelerate Asana's presence in those markets. Our direct sales model is built directly on top of our self serve model, which gives us a great advantage because by the time we engage with customers, our customers are already using Asana. We have a 2 phase selling model, land and expand. Typically, we land in organizations by powering critical workflows in a few departments, departments such as marketing, design, operations and account management. During this phase, we not only develop internal case studies of success with Asana, we also develop a network of champions who advocate for the product on our behalf. Then comes the expand phase. In this phase, it's very, very common that adjacent teams start to hear about Asana through word-of-mouth or they're invited directly into the product. Once we reach a critical mass of users, it's very common then and increasingly so as the work management category is maturing that companies are looking to standardize on one platform. And we're very well positioned in those situations. Let me give you an example of a customer lifecycle. One of my favorite customers is a Fortune 500 insurance company. There's a company that came to Asana as part of a bigger digital transformation initiative. The initial teams organically found Asana and our internal algorithms identified that this team and this account was starting to have some momentum in their success of using Asana. So we immediately connected this customer and this specific team with a customer success manager and help them onboard their workflows into Asana. Very, very quickly, a word-of-mouth effect took place. And what started with one team ended up being hundreds of teams also migrating their workflows into Asana. And we are very, very well positioned in that situation because we had already developed a network of champions. We had a number of case studies, internal case studies of success of how this company was able to deliver and execute on Asana. And ultimately, the customer signed a multi year enterprise agreement with us. And more importantly, our customer was able to launch a brand new product, ideation through execution, all in design. And IT teams love supporting the usage of Asana because it's so easy to use. The deployment is seamless, it's hands free. The IT department really has to get involved, if at all. And that's another big reason why people choose Sonu. So I just gave you an example of just one customer. We see a massive opportunity to expand in our customer base. One of the metrics that we look at on the health of our expansion is how many customers are paying us more than $50,000 per year. And our direct sales model has been really successful at growing that number every single year. Last year, we grew the number of 50 ks spend accounts by 2 50 percent and we expect that number to continue growing. Our customer champions are super important. They bring on additional teams, both inside their company and outside. That creates a virtuous cycle, which really takes us back to the beginning of the customer journey. They also join our Asana community, which is incredibly vibrant. And I think it's that customer advocacy that has helped us reach teams in 190 countries. Our business is incredibly global. Over 40% of our revenue now comes outside the U. S. And one of the beauties of our model is we can see where there is traction within our self-service model, which is a good indicator of customer demand. And that is our guiding light to where we put a local presence. And that's why we've decided to open up offices in strategic countries like Sydney to cover Australia, Tokyo to cover Japan, Munich to cover Germany, London for the UK and also an inside sales office in Dublin, because we had already seen so much traction in those regions and we wanted the opportunity to execute a more localized sales marketing strategy in those regions for us to continue expanding in those accounts and in those geographies. That moment when you no longer have to send an email or look at a spreadsheet to know who's doing what by when is the magic moment and people are converted. Our competition is the status quo of emails and spreadsheets and sticky notes and status meetings. And we believe that the vast, vast majority of information workers don't yet have work management tool. So it's a largely greenfield opportunity. We see large levers for growth in front of us along many vectors. In many ways, we're just getting started. 1st, we're focused on acquiring new customers. This is an emerging category with the vast majority of the world's information workers suffering from lack of clarity. Also, we have more than 3,500,000 free activated accounts focused on converting to our paid product. 2nd, there's a large expansion opportunity in our existing paying base of more than 82,000 paying customers, where we're less than 3% penetrated today. Here we're growing our direct sales team, roughly doubling them year on year and developing solutions to address this white space. And lastly, we see a huge opportunity to provide cross company clarity use cases starting with integrated goals in OKR Management. My name is Anna Binder. I'm the Head of People here at Asana. There's a lot of things, a lot of ingredients that go into the recipe of a culture. But let's start with some of the most important things. People want to know that they're working on something that matters. They also want to feel like it's their work matters. One of our goals is clarity and what that means and how it manifests for us as a company is making sure that people understand how their day to day work, every little task connects up to the objectives of the company and ultimately the mission. So if you think about Asana the product and Asana the culture, you can't have one without the other. The way that I think about it is the product allows us to make sure that everyone is clear on who's working on what by when. But it's not enough to just have the product. You have to have a culture that supports it, that reinforces it, that makes people committed to using the product and ensuring that everyone is collaborating well through that clarity. From the very beginning, our founders invested in culture. They saw culture as a key driver of our business outcomes. It was never an afterthought. It was never this secondary thing. And the work that they did very early on helped us set the foundation that we now as a collection of employees build upon. The ultimate validation of that investment in our culture is our business results and the fact that our customers can better achieve their own missions. But of course, we love the external industry validation that we get from places like Glassdoor, Inc. And Fortune Magazine. One of the things I'm particularly proud of is our Glassdoor rating. Both the company culture and the CEO have really high ratings there. And of course that matters because it gives people externally an understanding of how employees feel. But the reason that our employees give us such high ratings externally is because we create space internally for people to participate, for people to voice their concerns, for people to identify the bugs in the culture and work and co create the solutions to those bugs. We've got people that stay here and are committed for the long term because they're bought in, they're bought into a way of working, they're bought into a product that impacts the way people work. They're bought into co creating this culture with us. That's why we're going to be successful. I'm Ashley George and I work at Impact Justice. I'm the Associate Director and I lead our restorative justice project. Impact Justice is a nonprofit organization that centers innovation and research in order to seek a system of true justice and accountability. We have 2 headquarters, 1 in Oakland, California, 1 in D. C. And we also have several employees that work remotely working at a nonprofit organization. We're strapped for resources, and it's really important to be mindful and very thoughtful and and strategic about how we use our resources, our financial resources and our human resources. So it's important because the work is so large. I mean, we could be working all day, all night, that it's clear on how much work that we're able to do in a specific amount of time, given the limited resources we have. So my team, we run pretty much everything on Asana from hiring to our check-in meetings, to our big department goals. And so we use it to communicate, we use it to see the progress of what we're doing. And we also use it to create templates and to create opportunities for like things to be replicated. We've had people who've come on to the team who have never used Asana before pick it up pretty quickly. And it's really fun when you find out like new features and new tricks and we share those new tricks with the team. But it's pretty, it's been pretty intuitive. And even for folks who were like, I'm not really sure this new platform. Once we start doing it and incorporating into our processes, it just becomes like a second nature. During like COVID has been super helpful because we're not we don't have as much face to face contact. And so the conversations that you would have where you just stop by someone's desk, you're not able to have and so having a platform where you can send a message, you can create a task, a project, create the description, the timeline that can be the starting place for conversations that may have usually or typically have happened when we're face to face. I cannot stress how important it is to have all of your information into one central place. Asana, we use it as a tool to like capture all of our documents, to capture our notes, to capture our next steps, so that we have so that if anyone on the team were to transition, we were able to keep consistency. We're also able to then inform our new hires. So we like have our whole onboarding process where they go through the whole Asana things, and there's all these tasks, and they do their readings, and they're supposed to have meetings with different people. But all of this is laid out beautifully in Asana. So it allows us to be welcoming and inviting and also be effective in like getting stuff done. I love that. I love how organizations like Impact Justice are using Asana to change the world. We support actually a lot of organizations and it ends up doing good is good for business. So that's a good segue into our next Q and A session with Dustin and Chris. All right. Okay. This is a really good question to start with because everybody wants to know this answer. Chris, can you what are you seeing in the competitive landscape? Given the pandemic, has anything changed in the competitive environment? Who do you see most frequently? Yeah. So this is, as you've already heard, this is a large greenfield market opportunity. Most of the world's information workers don't have work management tools yet, and they suffer from lack of clarity. And the business imperative for this problem we solve is only accelerating. So the largest competitor with that as a backdrop, our largest competitor by far in that context and going after that opportunity is the status quo, as we already mentioned, spreadsheets and emails and sticky notes and meetings. That's competing with and what we're replacing. And then I think you asked, when we do see work management competitors in deals, which is a minority of the time, we don't see one in particular. There's not one that sort of we see more than the others. Oh, interesting. Okay. And how about next question that comes up, how do you think about Microsoft, friend or foe? Yes. So, when you look across our customer base, most of our customers, just almost all of them, either Microsoft or Google Shops for core email management and calendar management and more often than not for managing and creating documents. And so they turn to Asana for clarity and coordination and work management. And so because of that, we because of the customer base, we have lots of integration with different products from Google and Microsoft. And in the context of Microsoft, we actually have a really strong partnership. In fact, this past quarter in Q2, we shipped a new and improved integration with Microsoft Teams, between Asana and Microsoft Teams, where Asana provides the capabilities around organization and coordination and Microsoft Teams provides the capability around communication. And we've seen really strong pickup in interest from that integration in our base. This is actually a pretty good follow on too. And people ask this often. Can you talk about the customer journey? I guess they really want to know about like how the customer adopts it and how that feeds into our hybrid self-service model that you talked about in your prepared remarks? Sure. So we talked about this a little in the video. So we have a very intentionally hybrid business model and go to market model of self serve and a direct sales business that's built directly on top of that and they go together. And that directly maps to the customer journey, how customers find us and adopt us and then grow with us over time. And so typically, almost all customers start self serve. And self serve is that business is all about acquiring small free and paid teams across companies of all sizes. And then our direct sales business corresponds to sits on top of that and corresponds to land and expand motions. And so land typically looks like when we see signal in that self serve base of strong adoption and strong demand, land typically looks like finding a champion and establishing and deploying in a critical workflow or 2 within a department. And then expansion typically is when we grow beyond that, typically cross functionally engaging with IT and other decision makers to expand more broadly. Wonderful. Thank you. The next question, I like this next question, it means somebody probably picked up the S-one, which was just updated yesterday and has clearly been through it. In sales and marketing, where are you investing? Are you investing mostly in direct sales? How many reps do you have? Maybe we should just peel that one apart and just first talk about where you're investing in sales and marketing? Sales and marketing, okay, sure. So as I mentioned, we have an intentionally hybrid business model and go to market model. And we are absolutely investing for growth in both and they feed each other. So again, that direct sales business as we move up market and expand within companies is built on top of that self serve business. So self serve is all about this huge market opportunity we talked about with over 1,000,000,000 information workers. And it's really focused on acquiring new free and paid teams, small new and free and paid teams globally. And there, we're investing in marketing and top of funnel and the self serve engine to drive growth and acquisition of customers. And then our direct sales business, we're investing as well aggressively. There we're roughly doubling our sales team year on year to take advantage of this global growth opportunity, ensure we have the coverage to do that, especially with quota carrying reps. And we also have it's worth calling out like as we see as we move up market and we see cross functional collaboration, we do tend to find sweet spots where we see really strong adoption within companies, typically departments, in some cases, cross functional use cases. And so we began over the last year and a half to offer solutions there. So departmentally, we've launched Asana for Marketing and Creatives, Asana for Sales and Account Management, Asana for Operations. And then more recently, this summer, we launched our 1st class solution providing cross company use cases and solutions for the whole company with goal management that's integrated to the work graph that Dustin talked about. Wow. Okay. So the investments are really across the entire go to market chain. Yes. Wonderful. This is actually a natural next one. In terms of adoption, what drives adoption at the free to paid decision point? Yes. Okay. So we have a we're foundationally a freemium business, and we have a large base of free customers. In fact, we have more than 3,500,000 free activated accounts inception and it's growing. So there's a huge opportunity for us to eventually move those customers or a lot of those customers onto our paid to the to the our premium product, our base paid product from the free product is a number of things. Primarily, it's functionality that teams need at work for individual projects and processes. So for us, that's things like that are popular like timeline capabilities or custom fields. They're also sometimes into the team limit. We have a team limit of 15 free users beyond which you need to use the premium product. And also it's things like controls, roles and privileges and the ability to better control who sees what when. That makes sense. And here's a natural follow on to that. How about the what drives the adoption from premium to business and enterprise? Yes, sure. So as we mature in accounts and we see stronger adoption, we see movement to our higher tier offerings, our business tier and our enterprise tier. So our business tier is largely about when we get to the point of cross functional, when we see companies and departments or teams wanting to manage across projects and processes. So for example, they want to leverage portfolio capability to manage and track who's doing what, when across projects or they want advanced automation capabilities, They want to manage the workload across and make sure people aren't burned out and work as coverage, those kinds of things. And then our enterprise tier is largely about providing the security and controls and support that the enterprise or the IT organization requires. Yes. And that upgrade has been doing really well to the next year. I'm talking a lot. You want to ask. I know. Let me give you a break. I'll give you a break. There's actually a culture question for you, Dustin. Let's see. So clearly everyone's paying attention here. Anna talked about culture as a recipe. How has your recipe changed since COVID? For example, and they try to explain this a little more. Many companies have been doing things to help the culture with the onset of COVID, like the way they handle meetings, the more town halls. Is there anything that you're doing differently? Yeah. So I think, what I would emphasize is a lot of our cultural practices just became even more important after COVID. So for example, one of our cultural values is called Be Real. It's all about being willing to bring your whole self to work, be a little vulnerable, connect with people on a human level. And one of the ways this manifests is at the beginning of meetings, especially if it's a 1 on 1 with me and a lot of other cases, people start with just the simple question, how are you feeling? And 4 times out of 5, you get doing great, no problem, and you move on with the rest of the meeting. But the 5th time, you sometimes get a really substantive answer there and it becomes really important to check-in, understand what's going on. Because if you fail to do that, people aren't just sort of checking their emotions at the door. That's still going to come into the conversation, make it easier to lead into conflict or to make bad decisions. I was actually listening to a podcast just this morning about a study where they prime teachers to sort of put themselves in a bad mood or a good mood. And if they were in the bad mood, they actually graded papers 2 full letter grades worse, just because of that factor. So that comes into the workplace as well. And of course, in a post COVID world, you can't check your emotions at the door because there is no door. Our home life is just our work life. And you may even have, if you're a parent, you may have kids actually wandering into your space and there is no barrier there. So we think it's even more important that we're willing to drop in and connect at that level and really understand what's going on with our team and making sure that we're understanding each other and we're helping to support each other. And part of that support as well, just more from a sort of company and process standpoint, we've really developed more benefits around mental health, mental health support, so that people have resources if they need more engaged professional support. And we've really had to encourage our team to more proactively take time off because sort of goes without saying, nobody's really going on vacation. So you really have to think like, I'm actually just going to actively not work today for no reason. And so we've seen a drop off in sort of natural, you know, sort of voluntary PTO. We've had to, really encourage people and we've also established, like some other companies, a few coordinated Asana holidays. That's great. It's just a normal schedule. It's very much part of the culture here, and and COVID accentuates it, but hasn't really changed our culture. We just have more of the same. Chris, you're not off the hook yet. Let's go to you for another question. Are you seeing organizations make standardization decisions? And if so, what drives it? Okay. Good question. So, because we see such viral growth in word-of-mouth, once we see it or land in a company, because we see such viral growth that tends to companies, small, medium and large, a lot of tools are sort of coming in self serve, and then we are starting to see some standardization maybe on a couple of tools in some cases, or in some cases, we've seen standardization on Asana purely. The driver for that tends to be a few things. Companies or IT are looking for centralized billing. They're looking for enterprise capabilities like I talked about. And last but should probably should have mentioned first, they're looking to embrace the embrace what's already working, embrace the tools that their users and teams already love and are thriving with, and they want to offer that more broadly. So when standardization decisions tend to happen, we tend to be a beneficiary because of the sort of strong adoption and sort of NPS or referenceability I mentioned earlier, but also because the tool, I think Dustin or Alex mentioned this earlier, is so horizontal and so cross functional. Makes sense. And actually that opens up a bigger question, which is, you talked a lot about our go to market strategy and movement into the enterprise. Where are you on your enterprise journey? Where is Asana on our enterprise journey? Yes. So I'm going to presume that sort of means large enterprise and large customers. Right. I think. Okay. So, yes, so it's interesting. As I mentioned earlier, our direct sales model is built on our self serve model and it's a little different than things I've experienced in the past, meaning self-service is not just about SMB. I just want to reiterate self-service about landing in teams and companies of all sizes and always has been. So we've been seeding and growing in large companies as long as we've been seeding and growing in small companies. And we've matured quite a bit in that and we're doing that very intentionally and we're growing up with our customers. And our aspirations are absolutely to someday be wall to wall in the world's largest companies, but we're doing that in a very intentional way and growing with our customers. And so if you just look at the stats today, I'm we are about 2 thirds of the Fortune 500 have free or paid Asana. Some of the world's most valuable customer or companies, excuse me, are some of our largest customers. And the way that we sort of think about that intentionally is we're scaling with our customers. So on the product side and the go to market side, we've been roughly trying to roughly doubling our largest deployment each year. And I think last year, our largest deployment was 6,000 paid users and we intend to keep doing that. Okay. Are there certain industries that are best suited to Asana? It's interesting. Good question. So because of our bottoms up model, I mean adoption by industry, we've gone past early adopters. We're certainly into mainstream verticals now and mainstream companies. But there's an incremental interesting thing about a characteristic of our business, and I think it's related to the category and to Asano's business model where, within companies we see functional adoption curve, right. So a lot of the stuff we already talked about, marketing, sales, design, product teams, operations teams, they tend to adopt before, say, legal and finance teams within companies. And so, we're now sort of mainstream in terms of industry adoption, but we also see broad adoption and an adoption curve within companies that's more functional. Okay. Maybe we do 2 more questions. How about the profile of the kinds of customers where you tend to be widely deployed versus other vendors in the space? And can you speak to some of the tangible ROI the tangible ROI from some of your largest customers? There's kind of 2 questions in there, sorry. Sure. I think I'll answer both. So, thank you. So, let let's see. So on the first one, as I mentioned, like we're a very horizontal tool. So our self serve engine, as new teams come on board and get acquired, we're used incredibly broadly. And across all functions, strengths for us tend to be cross functional and external collaboration, collaboration and coordination or clarity with suppliers and partners and customers and that kind of stuff. Some of the competitors out there tend to specialize maybe in developers or finance or in verticals that are different from us. We tend to see really broad adoption, but we see particular adoption in where we started to build out solutions. I talked about in marketing and sales, on the business teams and operations. And then more and more, we're starting to see this traction cross functionally. But I think the other question was about ROI, right? So yes, so we hear playback from our customers all the time. The primary benefits of Asana are clarity, but the way that it gets expressed in benefits is time. Time back, wasted time across their employees, it gets deployed back towards their mission and goals and that's what gets us up out of bed every day. I mean, what's a more sort of inspirational value prop to be able to help customers with. And so they play back to us, they can be 10%, 20%, 30%, 40% more efficient with Asana. Some of our customers, I'll just throw out a couple of examples. One of them has saved an hour and a half a day per employee through the elimination of status meetings. Number 1, another one can launch new products to market 3 times faster with Asana, as examples. And if I can add on, one way of sort of describing the last two of Chris' answers is that the commonalities between teams across industries are more important than the differences between the industries. So if you have a marketing team in one industry and a marketing team in another, the kinds of problems that they face and their propensity to adopt new technology to solve those problems is really the driving force that makes us on a successful and the and the relative differences of industries are less relevant. Thanks. Thank you. Well, that's great. This is a perfect segue into our next section. Thank you so much, Dustin. Thank you, Chris. And now let's just move to the prepared remarks from Tim Wan, our Chief Financial Officer. As you've heard from our team today, Asana is a leader in a new category of software that helps teams orchestrate their work. With over 1,000,000,000 information workers in the market today, this opportunity is enormous and only in its early stages. And now with more teams working remotely, effective collaboration and clarity around who is doing what, by when is more important than ever. This is why we're focused on maximizing the opportunity and building the business for the long term. And this is how we plan to do it. 1st, we'll continue to establish our leadership position. We've earned our position in the market today because of our focus on the customer experience. Thanks to this focus, customers immediately get value from Asana through our self serve model. We'll build on customer acquisition. One measure of success in this category is the ability to acquire customers efficiently and increase adoption. With our bottoms up model, we're able to attract new customers across a wide set of industries, who then adopt Asana for a variety of use cases. We will leverage our differentiators for expansion. Our product architecture enables unique and robust capabilities that scale with the needs of complex workflows and cross company collaboration. And lastly, investing to scale. We have a predictable recurring subscription revenue model with strong growth rates, high gross margins, strong dollar based net retention rates and compelling unit economics. Given our leadership position in this emerging category and the large addressable market, we have the foundation for durable long term growth. Let's turn to our financial metrics. We've been growing revenue rapidly, reporting $143,000,000 in revenue in our fiscal year 2020, growing 86% over the prior year. In the first half of our fiscal year 'twenty one, we delivered approximately $100,000,000 in revenue, growing 63% over the same prior year period. Our success is a reflection of our constant innovation and our devotion to the individual and team experiences, which are key to adoption. Our go to market engine maps to the customer journey, combining a self serve model for new teams combined with a direct sales model for customers who want to take their usage and adoption to the next level with larger deployments. This growth has resulted in a customer base of over 82,000 paying customers and over 1,300,000 paid users globally. We have users and customers across 190 countries. Our international revenues were approximately 59,000,000 or about 40% of our total revenue last fiscal year. Our customer growth is a reflection of the value we deliver. In a recent Asana customer survey, 74 percent of customers surveyed agreed that Asana helps them accomplish tasks more quickly and 83% agreed that Asana improves their job performance. As organizations increase their adoption and footprint, Asana becomes their system of record for work. Whether they're working for a small business or a Fortune 500 company, teams can easily join Asana and get started. Oftentimes, teams are replacing spreadsheets, email or the status quo to better collaborate and track their work in Asana. Many teams start small and over time increase both the number of users and use cases on Asana. Our dollar based net retention rates reflect these dynamics and show the stickiness of our platform. As of January 31, 2020, our dollar based net retention rate was over 120% across our entire customer base. As customers increase their usage and adoption, we generally see a corresponding increase in their net retention rates. For the same period, customers spending $5,000 or more with us on an annualized basis had a dollar based net retention rate of over 125 percent and customers spending $50,000 or more with us on an annualized basis were over 140%. Let's now turn to our pricing model. Our pricing strategy helps enable customer expansion. Pricing is based on the number of users and subscription levels. We offer 4 levels of service: Basic, Premium, Business and Enterprise. Basic, which is our 3 tier has simple features to introduce users to Asana and limits up to 15 users. A small team might use this tier to track their weekly team meeting agenda along with deadlines and task owners. Premium offers a more robust set of functionalities for larger and more complex projects like launching a new sales office or product marketing campaign. Business is where we've seen the most recent uptick in demand. With business, customers can set goals, manage portfolios and monitor team workload across departments. And our enterprise tier builds on the business tier with more robust IT and administrative controls, stronger security features and higher support levels. Our higher priced tiers, business and enterprise are gaining significant traction, representing 46% of our revenue in the first half of fiscal year 'twenty one, up from 24% over the same period from a year ago. Our work graph enables critical and differentiated features such as portfolios and our recently announced goals function. The work graph enables our customers to move up the value chain and increasingly take advantage of the strategic nature of the platform. Our expansion strategy is already yielding positive results as more of our revenue has shifted to larger recurring contracts. In the first half of fiscal year 'twenty one, customers with $5,000 or more in annualized spend represented more than half our revenue, about 56%, up from 45% for the same period a year ago. On a revenue basis, this segment of customers grew over 100% year over year. We continue to scale our business effectively with more than 82,000 paying customers in a large installed base of activated domains and registered users. We have significant opportunities to expand within our existing base. We're still in the early stages of penetrating a very large market and we have an ambitious vision for the category. Maximizing the opportunity and investing for growth is our focus. Let's turn to our investment model. There are a few things I want to point out here. First is our gross margins. We have sustained high gross margins in fiscal year 2020 and the first half of fiscal year 2021, reflecting the efficiency of the business. Next is R and D. We intend to continue to invest in making Asana easy to adopt and more powerful for teams and organizations of all sizes. I also want to call out our continued investments in our sales and marketing. This investment reflects our commitment to our hybrid go to market approach. Our self serve model allows us to efficiently see what teams across different industries and companies of all different sizes. Our direct sales motion enables us to land and expand and upsell once an organization adopts and requires more robust functionalities. We've increased our investments in sales and marketing over the last 2 years. This comes in the form of performance and digital marketing spend and increasing our direct sales organization on a global level. We're building Asana for scale and our G and A spend reflects the investment we are making in people, processes and systems as we prepare for being a public company. Our investment philosophy reflects a disciplined approach. One measure of that is the payback on our sales and marketing investments. Our rapid growth is coupled with strong payback periods. Our payback period for the 12 month period ended July 31, 2020 was under 13 months, demonstrating the effectiveness of our investments. We recently completed our Q2 of fiscal year 2021. Here are the highlights from that quarter. Despite the impact from COVID, our results continue to reflect the resiliency in the business. We reported strong growth with revenue of $52,000,000 growing 57% over the prior year period. Gross margins were over 86%. In terms of the impact from COVID, there were both headwinds and tailwinds. Our overall dollar based net retention rate of 115% reflects the disproportionate impact on smaller businesses and segments that were particularly affected by the pandemic. However, our dollar based net retention rate for customers who spend over 5,000 and over $50,000 with us on an annualized basis remained stable at over 125% and over 140% respectively. At the same time, we have seen strong interest at the top of the funnel. Work from home has accelerated the need for teams to stay aligned, focused and productive. In general, we believe the current macro environment will help accelerate and bring more awareness to this category. We're not immune to the short term impact of COVID, but the response from the market and our customers overall makes us more confident in our long term strategy, our product position and our vision. We believe that this is the right time to be investing in work management and to define the future of work. The growth opportunity is tremendous. Let's turn to our financial model and how we plan to approach our investments. Growth is our top priority at Asana. Keys to deliver on durable growth are the following: bringing our product vision to market and continuing to make Asana easy to adopt and powerful for organizations and teams of all sizes and investing in our go to market functions with a disciplined approach as evidenced by our payback metric. With the shift to remote work, we believe teams have a greater need for collaboration and clarity. With our work graph and our product investments, we're in a position to unlock new and unique functionalities that will make work better for everyone. Given our high gross margins and strong unit economics over the long term, we expect to realize operating leverage, which we believe will enable us to generate free cash flow margins north of 30%. With our strong growth rates, high gross margins and commitment to innovation, we're building Asana for scale. We hope that you'll partner with us in this journey. FISMAAN is well known for our heating systems, but we have 3 business areas. 1 is climate solutions, refrigeration solutions and industrial solutions. Our core business is really in Germany, Austria, Switzerland. But then we have also a big business in the Nordics, so in Finland, in Norway, in Sweden. We are also going to the south of Europe, where we have some entities in Spain and Portugal and France and also the U. K. We are now acting in more than 50 countries globally with almost 30 manufacturing plants worldwide, where we see each other as a large family here at Fisman. As we call it, we have 12,300 family members. I mainly see the challenge that we need to get people working in one place. So that means they use the same tools, they work the same way and they know how to coordinate in a very structured way. Before we used Zana, it was quite difficult. We neither had a common store where you can place all files. It was a huge IT demand if you want to create a folder where every project member could access easily. And then we thought, okay, it would be nice if you could have a tool where you can have discussions about the topics, where you can really communicate in there also regarding responsibilities and deadlines, so the key things of a project? Yes. It was like I had a wish list, and then Asana came in, tick, tick, tick, everything was solid. AZANA as a tool is open to the whole organization, to all family members around the world. And we are quite happy that from a C level down to each and every individual contributor of the company, everybody uses it. And Adana supports us in being faster in our decision making, and decision making reflects down towards sales, down towards manufacturing, towards engineering products and so on. On the other side, it increases the transparency for decision makers to make better decisions because we say that you can only make the right decisions if you have to put context right. It's increasing our productivity. So here at Fisman, we use Asana with more than 6,000 people. They create more than 250,000 activities per day, and all of this is managed by just 2 people in my team. Asana is the enabler for us to be aligned and to unlock the opportunities that are around us as an organization. Before, there were just tasks flying around, and everybody was doing his things on their own. And I felt like a little gear, but I didn't had any effect on any other gears. And with Adana, I have the impression that we are working so close and so smooth together and we're like an engine. We work together every gear in the outer. Wow, I cannot think of a better way to punctuate how Asana is a map of all your work. And as they say, make decisions better and faster. So let's go over to Q and A with Dustin and Tim. All right. So let's jump right into it. Dustin, first question. What is your philosophy on balancing Sure. Thanks. Well, first of all, I like them both. I don't want to choose between them. But as a CEO, when I think about profitability, I'm less focused on the ratio of operating expenses to revenue and more focused on the union economics. So we know that we have really great gross margins today and we don't have any particular reason to see that changing in the foreseeable future. And just a direct consequence of that is we know we can be profitable if we choose to stop investing in growth. Fundamentally, the business is efficient. But there's also a really big market opportunity. So we've talked about the enormous TAM and these are really important years in the formation of the category. And so we think it's really important to play to win and be aggressive to invest in growth. And so I think that we'll continue to invest we'll continue to try and make progress towards profitability, but we're also going to continue to invest when we think that we have growth levers that we can pull successfully and be profitable in the future. It's great to have a good model. All right, Tim, we're going to jump right into net retention rate. Can you share more color on the net retention rate for all three of your segments? Sure. So our overall net retention rate did drop from 120% at the beginning of the year to 115%. And as I mentioned in the video, most of that impact was really disproportionate on smaller teams, so our sub 5,000 spent customers and those impacted industries. Now if you step back and look at the other 2 cohorts, the 5,000 annual spend customer as well as the 50,000 spend customer, those net retention rate remained the same at 125% and 140%. Perfect. And, you know what, this question is going to come up. So what were the other what was the impact of COVID on the business? Yes, what was the impact of other impacts of COVID on your business? So obviously, you saw it in some of the metrics in terms of the net retention rate. So let me talk about some of the tailwinds that we saw. Some of the tailwinds, one where we saw record traffic to our site in sign ups for both the free and the paid. Now it will take some time to kind of see how those free and paid customers monetize over time. So that was a really nice tailwind. And generally, I think when we step back and look at remote work and the need for knowledge workers to have clarity and alignment now more than ever, we think we're really leaning into the secular tailwind. And I would just add, to be transparent, there's also a short term headwind there that was partial contributor to the drop in net dollar retention. So it's just reality that a lot of our customers are going through economic hardship. Some of them unfortunately went out of business, others had to do layoffs. And so that does have a direct consequence to revenue. Yes, of course. Of course. Okay, let's actually go to your last slide, Tim. That's like the money slide, right? How are you thinking about this column that you had called the growth phase? How do you define the growth phase? Yes. No, great question. I think it's really important to kind of step back and really echo what Dustin just said. The category is relatively new and it's emerging. There are over 1,200,000,000 knowledge workers, and the vast majority of them don't have a platform to manage their work. We have 500,000 activated accounts that we have access to. We have over 27,000,000 registered users that we have access to. So the category is still new and there's a lot of runway for durable growth. Now with that said, we recognize that we're not in that growth phase today, but we will grow over we will grow over time into that phase. We're not going to talk about exact timing today, but with our gross margins at 86% plus, we have a lot of flexibility to invest. Plus the fact that our unit economics are really strong with a payback of less than 13 months, we know that the investment that we're making in sales and marketing will return over time. So as long as we continue to demonstrate strong growth, we'll continue to lean in and invest in the business. Absolutely makes sense. I mean, I think many investors are really familiar with the SaaS financial model. And that leads us to the next question. Can you discuss the improvement in gross margins you've seen in the last couple of years? What drives that? And is there anything you want to tell us about that? Yes. I would really attribute it to 2 things. 1, the scale of the business. We grew 86% last year, and we grew 63% in the first half of this year. So one, this is really just the scale of the business. And 2, the architecture and investments that we've made in R and D hasn't really enabled us to take advantage of the efficiency on the platform. So we've done a really good job there. You also talked about well, both of you actually on your presentation and Dustin just recently talked about it in his opening question. Can you expand more on how you think about your unit economics of your business? Yes. I mean, I think, obviously, we were very proud of the fact that they're under 13 months and continue to be strong. It's a metric that we monitor very closely. And as long as that metric stays pretty close to our expectation, we'll continue to invest. Okay. Just a couple more questions here because I know we're going long. We're trying to get everybody's questions in. Tim, one for Tim, one for Dustin. Tim, can you talk about growth from your new customers versus customers that are either, it's like 3 questions here. New customers, customers who are expanding the number of users or upgrading to higher tiers? Like where are those how would you look at those growth trajectories, those growth vectors? Yes. I think if you look at the growth over the last couple of years and the metrics that we provided in the S-one, you'll see a fairly balanced growth in terms of both on a customer on the customer side. So we grew from 75,000 at the end of our fiscal year last year to over 82,000 now. If you look at our seat, we started the year with 1.2 1,000,000 paid seats and now with 1,300,000 paid seats. And if you look at ACV, you'll see about a 20% to 30% growth year on year in ACV. So you'll see this natural progression in terms of customer growth, seed expansion and then customers moving from premium to business and then to enterprise. So fairly balanced. Perfect. I know we're running out of time, but we have to get 2 more questions in, Dustin. Where do you see the company, Dustin, in the next 5 to 10 years? And what do you think could surprise you to the upside? Sure. So in thinking about this, I first sort of go back 5 to 10 years. So when we were first starting the company, sort of an open question still about whether this would be a category at all or if in fact the status quo of email and documents would end up being the way that the teams coordinated forever. And as we've had more opportunities to tell our story, it's become clear that this is really a thing. And now in 2020, there's a real analyst category around it. There's quite a lot of adoption of Asana as well as other work management products. And so, yes, it feels much more like this is the future. But we're still in sort of the early adopter, maybe late early adopter part of the Geoffrey Moore adoption curve. So if you think about 5 to 10 years in the future, we should really be getting into more of the mass market adoption of work management and see a lot more penetration into that available TAM of 1,000,000,000 knowledge workers. So that's one thing. And so a lot of it is just developing the category and getting Asana distributed to a lot more customers. Is one thing I was going to say about that. How about surprises? What could you say? Yes. So the thing that could surprise you about that is really just all of it happening a lot faster. So 2020 has been a catalyst year for a lot of collaboration products. And we've seen a lot more interest inbound interest in adopting work management. And maybe this is the start of a decade long movement. So all of that could happen really quickly. The other thing I would just say about 5 to 10 years out, so in July, we held our Future VASANA event. We talked about our vision for what we thought of as the next several years of product development. But I hope over this long period, 5 to 10 years, we should be able to really manifest quite a lot of that vision and a lot more. So I'm really excited to see it come to life and be able to deliver all that value to customers. Wow, that's amazing. Okay. Last question of the event. This is a good one. So Justin, you could spend your time and energy on a lot of different things. Why did you choose to dedicate your time and energy to Asana? Yes. So there are a lot of different things I could have worked on, could have worked on trying to mitigate climate change or improve health care, improve government. But when you think about it, any important project in the world really has one thing in common, a group of people coming together to achieve a shared goal. And so all of those groups of people suffer from the pains of coordination that we've been talking about today. And so by working on Asana, it's really an opportunity to work on all of those different missions and more. So it's really what I like to call like the ultimate meta problem and just this enormous point of leverage to create progress in the world. And when we first started, my co founder, Justin and I used to talk about like, what if we could make these teams 1% effective, 2% more effective at achieving their goals. And already today, customers sometimes tell us we're making them 20% more efficient, 30% more efficient, and we're really still just getting started. There's so much more we can do. So, yeah, just really excited about the potential for this part of the ecosystem. Wow. What a great message to end on for today. Thank you so much, Dustin. Thank you, Tim. And just to close out for the day, I want to thank everyone here for joining us. We had a lot of information and there's more information on our website. Please feel free to see the recordings of this event on our website. And remember that there is a Q2 earnings report September 22 at 10 am Pacific Time where we will report our Q2 and provide guidance for Q3 and the fiscal year. In the meantime, feel free to contact me and we'll talk to all of you again soon. Thanks.