Hello, everyone. Hi, I'm Andrew Boone. I cover internet here at Citizens. I'm very pleased to host Scott Beck and Pat Gelsinger.
Yep.
Scott's the founder and CEO of Gloo. Scott previously founded Einstein Bros. Bagels and was the CEO of Boston Market and the COO of Blockbuster.
Yep.
Uh-
Spent a little bit of time in the Ancestry.com.
Yes
... and, Angi. Angi.
Pat is the Head of Tech for Gloo and the Executive Chair. He was previously the CEO of Intel, VMware, and COO of EMC. Point being is you guys know what you're doing. Gloo is a technology platform specifically meant for churches that help them to operate more efficiently. Scott, you're gonna go over a little brief of what the business is, right?
Yeah, we're gonna give you a little quick overview of that.
Yep, then we'll go into Q&A.
Yeah.
So-
That'll be great. Look forward to it. Thanks for having us here.
Yeah. With that, well, tell us a little bit more about Gloo?
Yeah, happy to do so. You know, first of all, you know, just as Andrew was saying, been in the building businesses for the last four decades, CEO of public companies, scaling large businesses, but also had been very active in philanthropy in the faith and human flourishing ecosystem. About 15 years ago, we saw there was a need to bring technology to this ecosystem. Pat and I joined in together on this about a decade ago.
Yeah. Obviously, I've been a tech executive for 45 years. I started when I was two. You know, have been deeply involved in technology for my career, you know, putting money philanthropically into the ecosystem saw that there was a gross deficiency in the technology of this community. That's really what led us to really focus on Gloo. When you think about faith and flourishing, you know, I think many of you probably don't have a good view of just how incredibly large, complex this ecosystem is. In the U.S. alone, right? You think about, you know, you have a little bit less than 20,000 Starbucks. You have well over 300,000 churches.
There's over 100,000 other, what we call network providers, who service the church, right, you know, who have other philanthropic missions as well. Literally, this is enormous, you know, ecosystem and extraordinarily underserved. As we view our TAM, right, we call the network capability providers, those who are, you know, beyond the church, servicing the church, servicing the broader objectives, over $130 billion of TAM available to us, and then the church's $85 billion. It's large, it's fragmented, and extraordinarily insufficiently technologically served, and that's specifically what Gloo is stepping into.
When you think about it's very important to think about the two sides that Pat just talked about. On the one side, you've got the network capability providers. These are the bigger organizations. Pat'll drill down a little bit more on that, but 70% of our revenue comes from that side. The churches, that's where about 30% of our revenue comes. We call those churches and frontline organizations 'cause it, in addition to being a church, you'd also have a recovery program, or you would have a anti-human trafficking program, all on the front line. It's the network capability providers that's a bigger part of the market for us.
Yeah, when you think about these network capability, you know, providers, these aren't tiny organizations, right? You know, in Bible translation alone, over $4 billion. You have 14 major campus ministry organizations, the largest of which is over a billion dollar . You have humanitarian organizations that are well over a billion dollar . All of them are mission-focused, right? You know, they're philanthropically driven, right? They get donor dollars, and they're technology-deprived.
When you look at what we're doing for them is a number of different things. Number one, bringing advanced technologies. AI is a big driver in our growth at this point in time. We'll talk a little bit more about that, but we bring that together to be able to power a couple things. Number one, power tech. Give them the benefit of, you know, shaping these technologies as a force for good to help them with their impact. The other thing that they need is reach. They need to be able to get to more churches. They need to be able to get to more donors. They need to be able to get to more people. It's reach and tech that's really happening here.
In many cases, as we think about the category, right, you know, this AI-driven engine is becoming the thing that tips these organizations over. In many cases, you know, there's very little outsourcing in this industry, so, you know, it's mostly do it yourself in the category. They've been unable to sort of keep that modern. When AI came, they just simply are rolling over, can't keep up, and that's where Gloo is stepping in, and particularly our AI services. We do much of the engineering for them, you know, chat services, agentic services, common data, you know, platform. Looking a little bit at the range of offerings that we have, you know, 70% is on the left-hand side of the page.
You know, things like Gloo 360, where literally we take over the entirety of the technology platform, you know, for those organizations, where if they had 30 or 40 people running tech, they become Gloo employees, right? We right-size them, we modernize them, and we turn them increasingly into agentic services. Our largest business is the media and the donor reach platform, the middle. That's the largest offering we have today. We also have, you know, higher margin SaaS services that specifically are, you know, where the minister works, where the staff of the church works at providing the range of services. Again, all of that is being driven by modern tech that's secure, that's scalable, and increasingly becoming AI.
When you look across this slide, we'll jump into some financials here in a moment, you know, across this slide, you can think of a contribution margin or a gross margin on average of about 50%. We're on our way there. This year, you'll see quarterly progressions toward that. You know, we feel like by the end of the year, we're gonna be somewhere in the mid-40s. Then as we move into next year, overall gross margin across these offerings will be in the low 50s. You know, yesterday, as we mentioned, we gave some updates, preliminary financial results for Q4 and provided some more guidance for Q1, as well as 2026.
For Q4, you know, we were able to have a strong quarter, beat consensus both in terms of EBITDA, the range, as well as revenue. Ended up the year around $93 million in revenue. As we looked at 2026, we're giving guidance. We were at $180 million, we've now increased that guidance to $185 million.
If you look at that year-over-year compare, right, obviously the business is growing rapidly. We're seeing both that result of acquisitions, but importantly, we're now seeing strong organic growth. If we ended the year at about a $100 million run rate, you know, that $85 million growth from 2025 to 2026, a bit of that is because of acquisitions. We assume about half of that growth comes from acquisitions. One of those is already done. The other half, you know, we're now seeing growth rates organically in excess of 40%. We'll just say that we're able to now step into the space of these organizations, repeatable sales models, right, that are resulting in acceleration and growth.
We've also made investments to, right, you know, be able to grow these businesses effectively, and those are now being realized as we turn toward a focus on profitability. As Scott mentioned, right, we see an acceleration in getting to EBIT profitability this year.
We've made great progress from. You know, we sort of hit a high point of investment in Q2 and Q3 last year. Q4, we've had a nice improvement in terms of reducing the negative EBITDA. Q1, we're now giving guidance, significant improvement, to $12 million negative, you know, coming off of, let's say, an $18.5 million from this last quarter down to, you know, $12 million. You're basically being able to really see that. The consensus was $14 million. We've, you know, made good progress there, and we've also publicly stated that we'll be approaching EBITDA profitability on an adjusted basis in Q3, and solidly profitable in Q4.
With substantial software SaaS elements of our revenue, you know, this needs to be a cash-producing business, right? You know, we do believe that, you know, the segment is large enough, right? There's enough profit potential inside of it. Clearly AI is the superpower, right? When we turn people into agentic services, that's great for margin and provides better service for our customers.
That's the overview.
let's go into what you guys announced last night.
Yeah
get into the business. Just talk about the outperformance and where that came from in terms of the increase, not only of what is the 4Q numbers versus the guide, also help us understand 26 and what that basically raise is implying and what's driving that.
Yeah, a couple things. As we go back, you know, on the revenue side, basically, we just outperformed the base revenue case that we had. You know, as we look at 2026, you know, Pat talked about that in terms of where the organic is coming from versus the other. As we look at the EBITDA, the real progress it's taking there is really combination of three things: good revenue leverage.
Yeah.
Okay? We're doing more revenue than what was in the plan. We're having some margin improvement that we're being able to see flow through and good cost containment. You know? One of the interesting things is we've done quite a bit of M&A over the last couple years. That M&A has been paying off. It's been paying off in terms of efficiency and economies that we've been able to reduce cost and be able to also help those acquired organizations grow faster.
Let's transition to the business. Right. Let's help people understand what you guys do. Just give me an example of how a church works with Gloo. Right? Maybe explain the Gloo 360 platform and help understand how a network provider works with Gloo to help go service what is a constituency of a church.
Yeah. Yeah, again, we wanna emphasize the two sides of the ecosystem. Churches, you know, those are typically smaller businesses. You know, for us, you know, thousands of dollars, right, per year, but there's a lot of them. Right, all of the churches are being served by the network capability providers. You know, if we're doing thousands of dollars per church over here, we're doing millions of dollars of revenue over here with the network capability provider. These are much larger organizations, and they wanna reach the church. These are very reinforcing relationships. You know, as we think about the network capability provider, you know, we're participating in, you know, the campus ministry segment, you know, the recovery segment, you know, the university, right, segment, 900 Christian universities.
maybe a particular example would be Bible translation, right? Where, there's over $4 billion going to Bible translation in the U.S. You know, a pretty stunning number when you think about it, right?
I mean, think about that. $4 billion going into Bible translation to new languages that haven't been translated yet.
Yeah. We still have 6,000 languages that aren't finished yet. It's really, you know, a lot of work, and AI is accelerating that. A Bible translation organization, their mission is Bible translation. They suck at technology. You know, let's imagine a couple hundred million dollar organization. They might have 40 people, you know, in their technology department. Literally, they have become Gloo employees. Right, we've taken them over, and we've done some downsizing, we've done some right skilling, and then modernizing of that platform. These are customers for life, as I like to say, because they are now relying on us for all of their technology. Furthermore, right, now as we turn more of that into modern technology and AI services, we're able to bring more margin and deliver a better service. It's not one Bible organization.
There's 14 major ones in the U.S., and when you win one, they want to have you win the other ones, right? 'Cause they work together a lot. We are able to move across that segment quite effectively. Now most of them are on our platform. We're now able to cross-sell other opportunities, bring them in for our media opportunities. We have, you know, category selling, but then we also have cross-selling of different services in the platform. Those churches, or those network providers, they are largely funded through the church, so that relationship becomes reinforcing. Most of our church offerings are what we'd call product-led. You know, much more digital offerings. You know, you can't sell directly. You know, this is direct sell, and that's largely a product-led motion where we're delivering SaaS-like services to churches.
Pat, I think that translates nicely into the next question in terms of you guys have announced 20 customers with million dollars.
Mm-hmm
... of ACV. Just help us understand kind of the relationship of how that grows, right? Is the maturation of the platform in terms of really bringing a network provider up...
Yeah
how do you guys execute on that?
Well, first of all, it's super exciting to be able to have, start to get the scale, and not only, you know, we've got, you know, 20 over a million, but we've got a couple now that are approaching 10 million, okay? Significant. They can come through a number of different doors. They can come through a door because, hey, they want donor services, and they wanna be able to get more donors, so they may come through, you know, the media network, or they may come through the door of Masterworks. They may be, "Hey, I need help with AI," and they're coming through the 360 door. When we think about those relationships, you know, typically, you know, they're starting with some use cases.
We're now very regularly signing, you know, hundreds of thousands of dollar contracts. These are typically one or three-year ARR agreements. I mean, it's now becoming pretty common that we're landing million-dollar-plus deals. As we say, we're able to cross-sell to other elements of the portfolio. When you have million-dollar deals, you can build a real sales organization, right? Now we're just hiring more salespeople to go execute, and we're also opening new segments, right? Like we just started winning the Christian universities. Between Christian and Catholic universities, there's 900 in the US, right? It's large segments that we're moving into.
Unbelievable. Scott, you mentioned the Gloo 360 platform. Just flesh out what that is for somebody who's newer to the story.
Gloo 360 is basically literally us taking chunks of their infrastructure. We may start by, let's say, taking over their donor management systems, or we may take the entire infrastructure over. Literally, that is us taking over those infrastructures, modernizing them, stabilizing them, productizing them, and then what do they end up with? Lower cost, better performance, higher security, being able to now benefit from AI instead of, you know, playing catch up. We're doing everything for the larger customers here. You know, we're running their Workday, their Salesforce, their Oracle databases. You know, we're running their help desk, their 7x24, right, call services, and more of that's becoming AI services.
You know, there's no outsourcing in this category, so when we take it over, right, it really is their first experience for, you know, a modern experience as well, and then more of that's becoming AI agents.
I think that segues really nicely into thinking through M&A for you guys, right? You guys are already deeply integrated. How do you guys think about moving what is maybe a third-party partner to be a first party and really, you know, transitioning them to being on platform where you guys own the property?
Yeah. When we think about M&A, you know, there's a lot of organizations servicing this community, right, for it, and we've successfully brought a number of these companies in. When we bring them in, we're typically able to accelerate their growth. You know, say, nominally, we're sort of doubling their organic growth rates, you know, because we have better network and capacity. You know, we're able to then accelerate our growth rate that we have and really become, you know, that environment where all of our data services, all of our customer databases allow us to provide more value to both sides of the ecosystem. We've done a good amount of acquisition successfully. You know, this year is more focused on profitability right now, than acquisitions. We have completed one this year.
Westfall Gold is the one that we've completed. As we said, about half of the growth this year over last year is acquisition, so we're well underway, you know, to have that in place. You know, we do see a rich candidate of future targets, even though this year is much more about integrate and drive profitability of the things we already have in the family.
Use Westfall as an example, right? You guys, Pat, you just mentioned the doubling of organic growth, right? Use that as an example to help us understand how you guys are bringing revenue synergies to an acquired.
Yeah
... product.
Yeah. When we think about a company like Westfall Gold, you know, they're running the campaigns for some of the largest organizations in the world, right?
Donor, donor campaigns.
Donor campaigns. You know, the yearly fundraiser campaign-
Yes
for the Bible or, you know, for the campus ministry. You know, they're doing that job. They need to turn to, you know, who's gonna actually do the marketing programs for that? Who's gonna do the advertising programs? That's Masterworks. You know, for us. We're able then to cross-sell for another portfolio element that we have. When those relationships are in place, we get to cross-sell Gloo 360, right. Many cases are looking for new AI capabilities as well, we bring Gloo AI. Every one of those becomes an incremental sell opportunity. As we're, have just recently finished the Masterworks integration, sell Gloo 360, introduce the Masterworks into those.
You know, we do see that we just get sales linear synergy across all of these and, you know, Westfall Gold, you know, we're super excited because that combined with Masterworks, our largest business segment today, and this ecosystem runs on donor dollars. If you're in the position of, you know, having the best reach to donor dollars, that's the most valuable thing that can be provided to the entire faith and flourishing ecosystem.
One more comment I would make on the M&A. You know, none of the M&A that we do, these folks are new to us. We know 'em, okay? They've been already on our platform. We've been partnering with them in market for years. Number one, super low risk. Number two, the donors stay. I mean, I'm sorry, the CEOs stay. Those CEOs, they wanna keep growing their businesses. They basically see us as that growth pro-propellant and the growth partner. Number three, they bring in their trust. These are 20, 30, 40-year-old organizations that have massive trust networks that we then continue to weave into our overall trust.
Yeah. Maybe just to add one point, you know, it's largely done with equity-
Yeah
... as well. They're also then deeply invested in the success of Gloo. Their brand, their company, and now, right, largely, Co-Owner of Gloo. It's a pretty powerful cycle.
Yeah.
Pat, you talked about AI as a tipping point earlier in terms of-
Yeah
... churches finally making the realization that, "Oh, okay, all right. We need to change something." Talk about AI within the ecosystem, one, as that tipping point and, you know, trigger point for change, and then two, how are you guys utilizing it within the platform in terms of creating a new set of products?
Yeah. You know, for it, you know, many of these organizations, you know, they were laboring to keep up, right? You know, "Okay, we don't trust somebody else to run our database, so we'll run it ourself. We'll have a small IT team," you know, laboring to run their own security services, you know, their own help desk services, but AI has just blown them away, right? You know, the other thing with AI is it trusted by this community? We've taken our trust brand, we're doing, you know, Flourishing AI benchmarks. You know, we're building, right, the guardrails that this ecosystem would expect and want to have confidence in AI. They look at us as, "Hmm, maybe I do or don't trust those foundational models," but when they come through Gloo AI, now I can trust them and use them, right?
We're also then forward deploying our engineers, building the data pools that allow all of these services to come together, right? That then enable many of these agentic services to start emerging. All of a sudden, they're getting a trusted modern AI experience that is enabling them to do things they couldn't have ever imagined before. You know, a pastor could ask a simple question like, "How many people were here on Sunday?" He doesn't know how to go into his CRM or find the data. Now he just asks his chat interface, and he gets the information, right? You're looking at these organizations who are seeing, you know, 10x returns from their marketing campaigns using modern AI services.
You know, as we say, the big three for us is, you know, the data services, the chat services, and the agentic, you know, services. Combining that with our 360 and forward deployed engineering, you know, models is pretty magic for this ecosystem, that they're going from worst to first on many of their technology capacities.
Really cool. I think that just segues into kind of like an overarching question is talk to me about what's the vision in two to three years in terms of what does the platform look like, right? Like, you guys are clearly building something larger, adding adjacencies through M&A. Talk to me about kind of the overarching vision, you know, take a multi-year view.
Yeah, sure. The, first of all, the network effects that are kicking in are really awesome. It's really unbelievable. This ecosystem, by its nature, cooperates at the same time that they compete.
Yeah.
That's basically driving a bunch of this increased scale. You know, we see ourselves just continuing to gobble up more and more of the ecosystem in terms of those different capabilities, the scale, you know. Then, you know, within a couple of years, we're looking at the global opportunities as well.
Yeah. You know, if you look at the businesses that we've talked about, Gloo 360, that should be a billion-plus business in a few years. You know, our media and donor platform, that should be a billion-plus business. Our church platform, that should be a billion-plus, you know, business. These become very cash productive over time. We're out to build not a mission-driven organization, but one that's highly profitable, highly cash generative, because, you know, without profit, there is no purpose, right? You know, that is the essence of what we're working to build.
Yep. Scott, you laid this out earlier in terms of financial guidance, but just talk me through kind of profitability at various stages as you guys get there. How do we think about balancing margin expansion versus further investments?
Well, you know, as we stated very clearly this year, we are very focused on getting to that EBITDA profitability.
Yeah.
You know, once we've got that, we've got a lot of choices then ahead of us. We've got, you know, a stock that will reflect that type of value, this type of growth. You know, we have more M&A that then starts to open up for us. We will continue to be focused on generating our own cash, being efficient, and growing with this ecosystem. You know, at that point, the sky's the limit.
Okay. Sky's the limit. Great way to finish.
Thank you.
Thank you guys so much.