Good morning, everyone. Welcome to Intuit's annual shareholder meeting. It's nice to see so many familiar faces. For those of you I haven't had the pleasure of meeting, my name is Brad, I want to welcome you to Intuit's Mountain View campuses. Our agenda today is pretty straightforward. After our formal presentation, I'll spend a few minutes walking through a business update. Then we'll open up the floor to any questions that you may have. Before we get started, I'd like to begin with just a few brief introductions. I'll begin with Intuit's board of directors, most of whom are in attendance today. They're seated throughout the room. I'll just show you their pictures, call out their name, and they can hold their hand up and let you know where they are. We have Miss Eve Burton, Scott Cook, who may be in transit.
Rick Dalzell does have a calendar conflict this morning. He won't be with us. He was with us last evening, and you'll get the chance to see him again in the future. Deb Liu. We have Suzanne Nora Johnson, Dennis Powell. You speaking to me. Our newest nominee, Tom Szkutak. We have Raul Vazquez and Mr. Jeff Weiner. As you can see from their respective profiles, we benefit from a depth and a breadth of experience that is invaluable to me and to the management team in navigating and growing this company. It is a real pleasure to serve with these individuals. In addition to these board members, we also have in attendance today Gordie Davidson, who is our outside counsel from Fenwick & West. We have both Brian Outland and Ye Wang, who is from Ernst & Young, our outside auditing firm.
Over here we have Mr. Chris Hummel from Broadridge, who'll be serving as our Inspector of Elections. Last but never least is Intuit's General Counsel and Corporate Secretary, who will conduct the formal portion of our meeting this morning, with Laura Fennell. Come on up, Laura.
Good morning. Thank you, Brad. I have an affidavit from Broadridge certifying that the notice of this stockholder meeting was properly mailed on or about November 22nd, 2017, to all stockholders of record as of November 20th, 2017. I also have a list of registered stockholders entitled to vote at the meeting. That's available for inspection. The Inspector of Election has executed his oath. It will be filed with the minutes of this meeting. Broadridge has counted the votes cast on each proposal. Mr. Hummel has informed me that we have a quorum. The polls are now open. You don't need to vote unless you'd like to vote for the first time or revoke your proxy. Does anyone need a ballot? Okay, great.
Stockholders have voted on five proposals described in the proxy statement. Following the polls closing, Mr. Hummel will tally the ballots and proxies and determine which proposals have been approved. I'll announce the preliminary results. Proposal number one is the election of 10 directors. Proposal two is the advisory vote on executive compensation, or otherwise known as the say-on-pay vote. Proposal number three is the advisory vote on frequency of future say-on-pay votes. Proposal number four is the approval of the material terms of the performance goals under our Senior Executive Incentive Plan. Proposal number five is the ratification of Intuit's selection of Ernst & Young as our independent registered public accounting firm for fiscal year 2018. Management recommends that you vote for all 10 director nominees and proposals two, four, and five, and vote one year on proposal number three.
Since there are no ballots to be collected, we are going to officially close the polls. We'll publish the final vote totals in the current report on Form 8-K, which we expect to file within four business days from today. We do have preliminary results. The stockholders have elected all 10 nominees to the board. They've advised of their approval of the company's executive compensation. They've advised of their approval of the future say-on-pay occurring every year. They have approved material terms of our performance goals under the Senior Executive Incentive Plan. Finally, they've ratified the selection of Ernst & Young. That concludes our formal business for today.
I'll turn it over to Brad in just a moment. I want to remind you that Brad's remarks may contain forward-looking statements. There are a number of risks that may cause actual results to differ materially from our expectations. For more information about these risks, please see the webcast version of this presentation and our SEC filings, which can be found on the investor relations page at intuit.com. Thank you, and welcome back, Brad.
Thank you, Laura.
Thank you once again for your support. Now we'll move to the business update, it's always wise to begin by looking back. My mom and dad used to tell me those who fail to study history are doomed to repeat it. Last year, as I was traveling around the globe visiting our offices, I came across this article in Fortune magazine entitled "How the Best Business Leaders Disrupt Themselves." It was the first sentence in the article that caught my attention. Why isn't Intuit dead? I thought I'd better read this article. As I went on to read the article, the author went on to describe that the answer is easy to state, but it's hard to emulate. It's because Intuit is continually disrupting itself. Something only a handful of incumbents have been able to do, companies like Amazon, Netflix, and yes, Intuit.
The author studied these companies and recognized three patterns that we all shared in common. The first is we view our businesses the way a disruptor would view it. The second, we have the courage to drive change even when the company is performing well. Third, we do this time and time again. That is exactly what every generation of Intuit employees have done over 34 years, through four major technology shifts, through numerous new competitors entering the market. Intuit's employees have been willing to step back and fall in love with the customer problem and not our existing solution. Go deep to understand the customer problem, apply the most simple, elegant design we can, use the most contemporary technology of the day, we measure success in the only way that really matters at Intuit, through the eyes of our customer.
To say it more simply, Intuit strives to be customer-obsessed, design-inspired, and technology-powered. As you know, our most recent reinvention began in fiscal year 2012, when we set out to reinvent the company from a North American desktop software company to a global cloud-driven product and platform company. That required a massive restructure. We divested businesses that no longer fit strategically, including the company's original product, Quicken. We also changed our financial model to move to a ratable revenue model. What's exciting is over the last five years, while driving that change, we found a new gear. Our customer growth for those customers adopting the cloud and mobile has accelerated 12% over this five-year timeframe, while we've retained a very important and loyal customer base that still loves our desktop products. At the same time, we shifted our sources of revenue by 10 points.
We now get 73% of our revenue through very predictable, recurring subscription services. We've expanded our global footprint by over 100%. It's the culmination of all of these efforts that led to a strong financial performance in fiscal year 2017, where we delivered double-digit top-line revenue growth, expanding operating margins, we grew our earnings per share 17%. I'm pleased to tell you this momentum has continued through the first quarter of fiscal year 2018, which ended on October 31st. While we are pleased with these financial results, this is Intuit, we step back and we look at ourselves very constructively. When you go underneath the financials and you look at the performance drivers of the company, there are areas where we are performing well and areas where I believe I and we are capable of doing more.
I'd like to spend a few minutes just talking about both sides of the ledger. Then we'll shift to what we're doing about it. First, starting with our company culture, it is a privilege to serve in this company. It is a company that has been values-driven from the day it was founded. It's a company that prides itself on having great talent. For 17 consecutive years, we've been rated as one of the top 100 best places to work. We're in seven countries, and in three of the countries, we were rated number 1. At the same time, our employees would tell you we're not moving fast enough. We aren't making fast enough decisions. We aren't putting the productivity tools in front of them that enable them to get work done as quickly as they believe they can. We're working on this.
Second, we are very passionate about our customers. We make improvements every year to our products. We haven't yet captured a way to put that passion into end-to-end experiences that are so amazing that your willingness to recommend our product is at least 10 points higher than the second-best alternative. We call that the Net Promoter Score, and we have a goal of 10 points better than the second closest alternative. We aren't there on all of our products, but we're working hard to get there. We have been transforming the company since 2012 away from being a product company to a platform. A platform means that all the other products in your life, whether we built them or not, will work with ours.
It means that other people you do business with, whether it's billers or it's employees or it's accountants, can easily work with you on this platform. We've made progress with accountants and small businesses. In terms of third-party developers building on our platform, working well with banks, we still have more work to do. As a 34-year-old company, you have some really new, exciting technology. You have some technology that's a little bit old and dated. We've been working hard to refresh all of our technology so all of our customers get the most relevant experience. As we look ahead, we still have some work to do. We're rewriting our tax platform to be global-enabled. We're also making sure we're moving our products into the public cloud, Amazon Web Services, so we can actually host that more efficiently and get faster innovation from our engineers.
We're working on something called artificial intelligence and machine learning. You've heard a lot about this. It basically means we get our product to do all the heavy work, so you don't have to worry about that. You simply get to the outcome much faster. Market results. We had a really good year in small business last year. We were able to grow our customer base 58% in our online version. We improved the quality of our product 22 points year-over-year in Net Promoter. We achieved our financial result. Tax also had a good year. Tax also would tell you that we only held market share. We have a higher bar for ourselves. This year, you're going to see some exciting new things coming out of our tax business to try to take our game to the next level.
I touched on the financial results, good double-digit growth, but I'm about to take you through a new company strategy, and with the new strategy comes a new set of priorities, which means we need to put resources on those new things and begin to move resources away from some of the historical things. When you look at this, it was a good year. We know there are things we can work on to be better, but it gives us a really strong foundation upon which to build. We're going to need this foundation because as you look out over the future, there are major shifts occurring in the marketplace. These shifts can be catalysts for growth if we capitalize on them, or they could be sources for disruption if we fail to execute. To learn about these, we took our top 100 leaders.
We broke them down into three-person teams like you would in school. We call them action learning teams. We sent them out around the globe. They spent time meeting with 500 customers, interviewing 225 venture capital firms and experts, and they ran experiments in five countries. What we learned as a result of that nine-month effort was pretty important. First of all, customers now want immediate benefit. In fact, the average attention span for a digital native is eight seconds. It was 12 seconds four years ago, and a goldfish attention span is nine seconds. We are now getting measured in immediacy. They also want deeply personalized experiences. They log in, they want it to say, "Hello, Brad." Maybe I've never even logged in, so we've got to work on that. There's the rise of the self-employed. You've heard about these individuals.
They drive for Uber and DoorDash and Lyft and TaskRabbit. They work for multiple companies, not one company. It used to be 17% of the workforce a quarter of a century ago. It's 34% of the workforce now, and it's going to be almost half in the next five years. This is the new way people are going to be working. We have to make sure we understand what's important to them. This next piece is many and many of our customers are living more hours a day online, on their iPhones, on their Android phones, on Facebook, on LinkedIn, on Amazon, up to eight to 10 hours a day. We need to go where our customers are. I mentioned the next generation. As we look at the employees of the future, they want to have a purpose-driven company.
They care about corporate social responsibility, they care about the environment, and they want to have an impact, which means they want to work in a company where they can move at the speed of a startup. They want to have access to the most contemporary technology, which today is machine learning and big data. They want to work for a company that has the courage to disrupt itself, because somewhere in a dorm room or a garage, a company's trying to invent the next version of what we have, and they're going to try to put us out of business. We have to be willing to do that ourselves, just as that article said at the very beginning of this talk track. This was a lot of new insight, and it led to some implications for us.
We have to remain customer obsessed. We're going to have to get really clear about what it is the customer wants when they buy our product. We call that the customer benefit. We're going to have to get much more personalized in our products. We have to make our products a platform where people can spend time interacting with all the different constituents that they do business with. The roles of the players that we serve are evolving. The self-employed customers have a unique set of needs. They're not consumers, they're not small businesses, and we have to build a product that's right for them. The accountants, they have been our partners for 34 years. If there's a profession that's going to get drastically changed with this big data and this machine learning, it's the accounting profession.
We're working with them to help them get to the next chapter so they remain just as viable and relevant in the next chapter as they have been in the last one. We're working with the Apples and the Amazons and the Facebooks, these mega platforms, so we can have good partnerships with them. That'll help us build new advantage in the future. That's sort of the overall insights we captured. We thought we would learn something. I quite frankly underestimated how profound those insights would be. As a result, we've rewritten the company's game plan to win, including a new company mission, a new strategy, and a new set of metrics. I'm going to spend a few minutes just walking you through at a high level what this new game plan is. I'll talk about how it's already driving improvement in our customer's life.
It's building new sources of competitive advantage. It's opened up new growth opportunities. That'll take about 10 minutes. Then we'll open it up for questions. You with me? All right. A game plan always begins with why. Why are you in business? Our why began 34 years ago at that small kitchen table that sits out there in the hallway, when Scott observed his wife trying to balance the family checkbook and said, "There has to be a better way." What you may not know is over 34 years, how we've defined that why in words has actually changed four times. Our most recent mission used to be to improve our customers' financial lives so profoundly they couldn't imagine going back to the old way of doing things. Now, that was an aspirational mission, but it was anything but succinct. 16 words and a comma.
We said, "We can do better. We want something that makes our hearts beat fast, but needs to be more memorable." We have now captured the mission this way: powering prosperity around the world. As you might imagine, we have debated every single word on this slide. Why prosperity? If you look up the definition, it is the state of thriving, of succeeding, of good fortune. It's also something you can define in your own terms. Some customers say, "Hey, I want to live better work-life balance." Others say, "I want to be the next Scott Cook." You let people define what prosperity means to them. For Intuit, it captures why. Why we get out of bed every morning. To be the champion of those who dare to dream, the self-employed and the small businesses who employ half of the world's workforce.
They create 60% of all new jobs. They know the odds of success are stacked against them. One out of two fail in the first five years. They are the backbone of the world's economy. The world is working against them. We want to be the champion of those who dare to dream. On the other side are individuals and families who struggle to make it paycheck to paycheck. 70% are fighting to put food on the table and get their kids to school. We want to provide them financial freedom. If we can make that happen for those two groups, the entire world's prosperity will improve. That's what we focus on. Of course, we have a company that we strive to be a company that's built to last.
It is a values-based company. Like our mission, our values have been refreshed in words four times over the last 34 years. Most recently was in 2014. I've shared these with you in the last several years. They haven't changed. They stand the test of time. I won't go through them again this morning. We live them every day. The next part of our game plan is how do you measure success? Every company has a way of measuring success. We call this True North. It's grounded in two principles: stewardship and stakeholders. By stewardship, it means we not only hold ourselves responsible for delivering great results this year. We hold ourselves responsible for making decisions today that leave the company better for the generation who will follow us. We call that short and long-term thinking.
In terms of stakeholders, it simply means we're clear about who we serve. We've asked them what success means to them. These are the four stakeholders we serve, employees, customers, partners, and shareholders. For each of them, we have a vision statement and a set of aspirational objectives. There's an internal version of this document, that underneath each of these objectives, we have a one-, two-, and three-year goal. That's how the board assesses my performance. That's how every employee in the company's performance is assessed, not just this year, but are we on track for the next three years? That is exciting. Those are outcomes. How are you going to make it happen? That's where strategy comes in. A strategy is like a GPS. A GPS begins by asking you, where are you trying to go?
We're trying to go here, our mission, powering prosperity around the world. It says, okay, if that's where you want to go, where are you beginning? We begin here, one customer at a time. We've taken the time to figure out why they buy our products. Our products are finance and compliance products. When you ask customers what's the benefit you need most from our products, they want more money in their pocket, with little to no effort, and complete confidence they didn't leave any pennies on the table. That's how we measure success at an individual customer level. If we know where we are and where we want to go, the next thing a strategy does is say, okay, here's the route to get there. That is the one Intuit ecosystem strategy.
Our new strategy is designed to unlock the power and the contributions and the data of everyone who works on our platform to translate that into a better outcome for every single individual. We basically describe it as unlocking the power of many for the prosperity of the one. Here's how we got there. We studied 34 years of history and said, what has enabled our company to end up in that Fortune magazine article? It's because we remain customer obsessed, design inspired, technology powered, we said we're going to keep that. We said, where are we going to focus all of our employees' passion and energy? We're focusing on finance and compliance. This is where I'm going to make a confession. I have two daughters. I've talked to you about them often.
When they were younger, they would say, "Daddy, I love that you work at Intuit, and I love going to the campus. Really, accounting and tax and payroll? What about video games?" I said, "Honey, those are all exciting products, but let me tell you why we do what we do. These things aren't things people get excited about, but if they get them wrong, there are big consequences. They have late fees and penalties and interest, and they go bankrupt, and their kids can't go to school, and they can't buy video games. You're helping your kids' parents buy them video games." They said, "Dad, you're cool." We focus on finance and compliance. We take that and we say, let's be clear who we serve. This is one of the things that makes me proud about this company.
There's a gravitational pull to call on the big businesses who sign tens of millions of dollars worth of contracts. We focus on the overlooked and the underserved, the small businesses and the self-employees who power the world's economy, and the individual families who are trying to make it paycheck to paycheck. We realize in today's world, as a platform, we can't solve their problems alone. Like King Arthur's table, these partners sit at the table with us, and it's their contributions with ours that co-create value. This is where the strategy comes alive.
With all of their wisdom, all of their experience, all the mistakes they're willing to share with each other, and their successes, we put that with our technology and our data, we're able to deliver those personalized experiences that the customer said they want through a trusted open platform where everything works well together, we create indispensable connections where no one is ever alone again. They have other people with them who are willing to help. That's our strategy, the one Intuit ecosystem, unlocking the power of many for the prosperity of one. Every company takes those things and breaks them down. We've got six priorities, three designed to accelerate our speed in doing what's right for customers. That's delivering awesome products at the speed of a startup with new technology.
On the right, we're very clear about delivering those benefits I talked about earlier for those customers. Of course, we have metrics we measure. We measure these on an hourly, daily, weekly, monthly, quarterly, and annual basis. When you put it all together, what you should hear is over a nine-month period, we studied history, we looked to the future, we challenged ourselves, and we refreshed our game plan from top to bottom. I'll be the first to tell you, these are just words on a PowerPoint slide with some pretty visuals and builds, and the way you really test a strategy is if it's improving the customer's life, if it's building new competitive advantage that makes it hard for competitors to compete, and if it's giving you new opportunities for growth. I'll wrap up with that and then take questions.
The first thing our strategy has done, it's helped us leapfrog away from just conducting a transaction, like filing a tax return, to now facilitating an interaction between you and a tax professional if you have a question, you and an accountant if you're a small business, I'll give you some examples. The first, I mentioned small businesses. Really big dreamers. Odds stacked against them. The number one way they can prevent failure is by working with an accountant. If a small business works with an accountant, the odds of success go up 89%. On the other side, the accountants have these clients who show up with shoeboxes full of receipts, folders full of paper, and sometimes not all the stuff they need. They get four new clients a year on average because they're so busy typing stuff into software.
We took our product called QuickBooks Online, made it a platform. We turned it into a dating service called Matchmaking. We said, let's take all of our small businesses who need an accountant and all of our accountants who could use more clients, let's start to connect them. In the last 12 months, the number of small businesses in our base who now have an accountant is up from 43% to 53%. Accountants are getting 300% more leads from us than they were one year ago. They're both succeeding. By the way, because they're doing that on our platform, the retention of our platform has gone up 12 points. We call that win-win-win. Same thing with tax professionals. Tens of millions of people will be willing to file their taxes and pay nothing, or on average for TurboTax, $50.
They often have one question they're unsure of. They sold stock last year, they moved between states, they're just afraid they're going to get that wrong, so they end up going to a tax store or a professional and paying hundreds, if not thousands of dollars. We said, what if we could bring the tax professional into the product? We launched something called SmartLook. At the touch of a screen, a tax professional shows up in a one-way video. You ask the question, they answer the question. They even circle on your screen where to push to teach you where to go. In that one product feature, we've increased confidence in the taxpayer 10 points.
We've created a new revenue stream for tax professionals who are willing to get paid by the hour to answer our customers' questions, and we've opened up a whole new group of customers we can now serve with our product. Again, a win-win-win. Last but not least, I mentioned self-employed. Here's what happens with self-employed. They make a choice not to work for one company and get a paycheck, but multiple companies. What they don't realize is by doing that, the government now considers them a small business, which means they have to file a special tax form called a Schedule C. That means they have to separate all their personal expenses throughout the year from all their business expenses, or they'll miss important deductions. What we did is we launched QuickBooks Self-Employed. Swipe left if it's personal, swipe right if it's business.
We launched a sister product called TurboTax Self-Employed, where you push a button, it goes in there and does your tax form for you. What we did last year is found $4,300 in tax savings for the average self-employed. That is an 8% annual income increase for those individuals, and these are the fastest-growing products in our platform. You can see, these are three examples of dozens where we're now creating value on all sides and creating more value for Intuit. That is creating new sources of competitive advantage. This is how we've historically competed. We've earned the trust of the government, of the banks, of the accountants, of the small businesses and consumers to take care of their data and protect it.
We've worked hard to connect accountants and small businesses, but most importantly, we're known for this, taking 72,000 pages of the IRS tax code and turning it into simple yes and no questions in TurboTax. We make complicated things simple. With our strategy, we have a new source of competitive advantage. It's called this platform and ecosystem. As I already showed you, by having people on both sides be able to interact with each other, it increases the stickiness on our platform, so customers stay with us. They're contributing a whole bunch of data. In that data, we now have 150 patents filed where we've written smart algorithms that can do the work for the customers and help them get more money with less effort. Last but not least is we're creating this network effect where people are stronger together than apart.
We now have new sources of competitive advantage. It's really hard for others to match. Which takes me to my very last point. We now have new opportunities for growth, and you've seen it show up the last couple of years. First of all, in our core products that are already in the market and in the markets we're already in, we've caught a tailwind. The tailwind is the cloud is here, and mobile devices are the way people want to do a lot of their work. We now have eight out of 10 of our new QuickBooks customers choosing the cloud and nine out of 10 TurboTax. The cloud allows us to go across the globe into new countries, and it allows us to serve the self-employed, who by the way, operate in cars. They don't use desktop products. They use their mobile phone.
By creating this product on a mobile device, that's grown 350%. That TAM, total addressable market, is $30 billion. We're $5.5 billion in revenue today. That is a lot of headroom for growth. In addition to growing our core, I just showed you examples of how we're connecting the ecosystem, which is accelerating our growth. I talked about accountants and small businesses. I talked about tax professionals inside of TurboTax. Here's a couple of others. We're taking our invoicing out of QuickBooks, putting it in partnership with Google and Google Calendar, sending an invoice right out of Google Calendar and getting them paid in one-third the time. The small business is getting paid faster. That's creating a win for everybody, including Google. The other example is lending. Small businesses need loans. 60% of them, the banks turn down.
Inside of QuickBooks, we can see they pay their bills on time. We can see how many people owe them money. We can see the projects and the inventory they have. We've written algorithms that are better predictors of their creditworthiness than what's in the market, and we've been able to get loans extended through other lenders to these individuals that 50% of them were considered unlendable one year ago by the bank. That's creating new opportunities for growth. Then last but not least, we think we're starting to come really clear on a global playbook. There are other countries beyond the seven we're in that we believe if we can go replicate that success, we can once again expand our opportunities for growth. That's a lot. That's a year of reimagination and transformation.
What I hope you took away from this was fiscal year 2017 was a milestone year for our company. While we delivered really good results, we also recognize we have opportunities to improve. We studied history, and we brought those lessons forward. We tried to look into the future, and we said, "What do we need to change to be ready for the future?" Then we rewrote our company with a new mission, a strategy to unlock the power of the many for the prosperity of the one, and we are at work today to make this all a reality. Thank you for your patience as I went through that business update. With that, I'll open it up for any questions that you would like to talk about. Thank you. I know this group's never shy. Here we go.
Can you explain what effect the new tax changes might have on Intuit?
Oh, thank you. First and foremost, this is still getting finalized, as you know, we're awaiting some final things to come out of Congress in terms of how it will be implemented. In a headline, Intuit has always been for tax simplification. We have felt that it would be the right thing for consumers to be able to get their obligation done in a way that was less onerous on them. We spent a lot of years trying to make this complicated thing simple. I think we took a step in that direction. I believe everyone would tell you it's not as far as we all wished it would be, but at a minimum, it is a little more simple than it used to be. What happens in the market is any time there's change, there's fear, uncertainty, and doubt.
This is where we've shown up. We have a portal where we can answer all the questions and a calculator that helps you say, what does this mean to me? We've armed our accountant partners with the same kind of information so they can work with their clients. We've launched a product that not only allows you to do your taxes yourself, but you can bring a tax professional in, like I showed you, at the touch of a screen, and get your question answered. I think this is good news in terms of our ability to help more people realize they can do their taxes on their own. It's getting more simple, and we've got services to help you make it even more simple. On the business side, as you know, roughly 95% of our revenue and profits are in the U.S.
Our taxable rate on a non-GAAP basis was about 33%, but this new tax rate, we'll have a blended rate this year that'll move it closer to the 27%, then over time, it'll get closer down to the more statutory level, the 21%-23%. That will somehow lead to about a, call it $0.35-$0.75 opportunity in earnings per share. We think that will create new opportunities for us to continue to reinvest and grow this company, to make sure we have a culture that retains the top talent and continue to deliver for our shareholders. It's an opportunity for us to make it simpler for customers, and it's an opportunity for our company to use new powder to say, let's make sure we're creating a vibrant company for the long term. Thank you.
Thank you, Brad.
Thank you.
My wife watches more TV than I do, and she called me about seeing an ad by, I think, H&R Block, that was saying their product was better than yours.
Yeah.
Do they do that? What's your response?
Well, I think first of all, our competitors are amazing companies. They're all strong in their own right. They keep us on our toes. Secondly, beauty's in the eye of the beholder, and we ask our customers whether our product and our competitors' products are better or worse, and if you go out to the Amazon reviews or the Apple or the Google reviews, you can look at star ratings and reach your own conclusion. The answer is, our competitors are mentioning us in their ads, and I take that as a tremendous compliment because the more advertising for TurboTax, the better for all of us.
Next question.
Yeah.
Some companies are moving out of Silicon Valley because it is so hard to hire new talent because of housing prices.
Yeah.
How are you doing on retention, and how about relocating?
Yeah. Well, thank you for the question. As you know, we have about 8,000 employees around the globe. We have roughly 3,000 here in Northern California, another 1,000 or so in San Diego, and then the rest are around the globe. We do have locations around the globe where we employ top talent. God was a egalitarian when he handed out talent. The economies weren't egalitarian when they handed out jobs. They tend to be on the coast, but there are lots of great people everywhere, and we try to recruit from everywhere and create an environment where they can contribute. To answer your question on our attrition, I am very pleased to tell you that our voluntary attrition rates right now are about 11%, which are two to 300 basis points lower than our peers sitting right here next to us in the valley.
We work hard to create an environment where everyone feels like they're an entrepreneur. This year, Scott's gone to every location with me around the globe, and we've trained them on the Scott Cook innovation methods. We call that Customer-Driven Innovation and Design for Delight. Everyone's treated like an entrepreneur, and we'll create space for them to work on new and exciting projects. If we keep doing that, we think we can compete for talent. We have no plans at this point to exit Silicon Valley. This is where great talent is. We just have to work hard to make sure we're keeping these employees with us and getting more people to join us as well. Others? All right.
I have an acquisition target for you.
Okay.
It's called Paycom, P-A-Y-C-O-M.
Familiar with Paycom.
Okay. I own some shares. The stock price went up 78%.
Yeah
in 2017.
Yeah.
You only went up 38%.
I know that. Paycom envy. Honestly, Paycom's a wonderful example of why it's important for companies that have been around, like we've been around, to continue to reinvent itself. They've done a wonderful job. They're solving an important problem that's not new, helping you manage your employees, your HR, your benefits, but in a new, fresh, and contemporary way. We study them, we study lots of other companies, and we try to bring those best practices in. That used to be called plagiarism. Now it's called benchmarking. We're more than happy to learn from anybody. If and when there's ever an opportunity for us to decide we should be working more closely together, you'll be the first to know. Thank you. All right. I think I have it. Yes.
I'm a longtime user of TurboTax, and it's very sticky, which is a really good thing. I also, I'm a point person for many of my friends who are not as technically literate or don't have the time, so I talk to them about changes in things like TurboTax. I've been using the Home & Business version, but you mentioned that there is now a new version called Self-Employed, and I wasn't even aware of that.
Yes.
I was wondering, how do you decide which version? Is there some information about that helps point you to which one, because I didn't even know that one existed.
Yeah. Well, thank you for the feedback. Clearly, we have more work to do if that's the case. Actually, our Home & Business version has morphed into this Self-Employed version, so there's a little bit of a brand change, but there's also a feature functionality change. When you go to turbotax.com, we're working hard, we have more work to do to make it easy for you to figure out which of these you should select. We try to describe it in terms that we wouldn't use, but every day I might use at home with my wife, and we're trying to make it easy for you to get in there. Then if you end up in a solution that's not right, we want to make it easy for you to go ahead and just transfer the data into the other one.
We've got more work to do, the short answer to your question is, if you go to turbotax.com, you'll actually see the product line-up, then it has a tile selector where you can go in and say which one would be right for you. Then please, after you do that, send me feedback, because if you don't find it simple and clear, that gives us a chance to improve.
Sure. Those are two different versions currently?
Yeah. Dan, you want to grab the microphone and answer that one? This is Dan Wernikoff who leads our Consumer Group, which includes TurboTax, for those who are on the broadcast.
Yeah. The online product is TurboTax Self-Employed. The desktop is Home & Business currently. They'll continue to transition. A lot of this is bringing, like Brad said, the ecosystem together. QuickBooks Self-Employed actually works with TurboTax Self-Employed in the online editions, where the data can flow very seamlessly between them. Home & Business will probably persist for some time on the desktop.
One more thing. I'm really glad you're keeping the discs because some of us do have longer attention spans than nine seconds.
Yeah. By the way, I say that not only just to let us know how quickly people want immediacy. You talk about the eight seconds. I think I've shared with you before, neuroscientists have studied children under the age of 10 who were born after the invention of the iPhone. Their brains do something our brains can't do. They can process multiple things simultaneously. We actually multitask. Our brains go red and green, depending upon what we're doing. They have a real ability, despite parenting saying, "Focus." They're like, "I am focused. How could you focus when you're listening to music? I could do two things at once." "No, you can't." "Mom, you can't. I can." Yes?
Could you talk a little bit about global expansion? Over the years, I've been kind of interested that you're still limited in the number of countries you try to do business in.
Yeah.
Could you talk a little bit about that?
I can. I can. I think many of you who've been with us for a while would know that it's not new for us. In the '90s, we had gone to roughly 27 countries with a desktop product. We did it through a variety of ways. We bought the leading player in each market, or we took a U.S. product and we re-engineered it and tried to introduce it as a local version there. We really weren't that successful. The technology was hard to localize. The competitors saw us coming. Many times we bought the leader, but then we didn't give them the attention because we're very U.S.-centric, and so they ended up getting beat by local competition. When the cloud came about, 2007, 2008, we said, "This is a new chance to do it again, but let's go study that history.
Let's go learn from companies we admire, PayPal and Amazon, Facebook and others, let's figure out how we're going to do this right." The formula was pretty straightforward. Don't start with your solution, start with the customer problem. Go in and understand what their needs are, then decide, does the product in your current portfolio work, or do you need to invent something new? Can you do it in a way that's better than the local competition? When you get that right, that's called product-market fit, which means you have the right product for the right market, and it's better than any other alternative. That's when you turn on advertising. What you see us doing in a very deliberate fashion is going one country at a time and going through that methodology.
Even though we're currently in Canada, the U.K., Australia, France, Brazil, India, we have scout teams in other countries, they're already running those experiments and answering the question, would it be QuickBooks, would it be another product, or should we invent? That's when we go in. I'm pleased to say we're starting to see the fruits of that labor. Last year, our global product grew 75%. The year before, it had grown 45%. It continues to accelerate, which gives us confidence we're starting to see the playbook. I will say this, I know I've used this analogy before, again, a father of two daughters. Sometimes there's a nervousness if we don't get there fast, someone will beat us to the market. We've learned it's not when you get to the dance that matters, it's how you look when you show up.
We need to make sure when we show up that the product is right and it's better than any other alternative, that will allow us to dance as long as we want to dance. Make sense? Other questions? I want to thank you once again. You're an incredibly supportive group. I enjoy seeing the faces each year. I love the questions, thank you for the feedback throughout the year. You're one of the many reasons why Intuit is proud to serve, ultimately, why we're successful. If you have any feedback for me after today's session, I'm always open and willing to hear that. Thanks again for coming today, I wish you a happy 2018.