Good afternoon. Really appreciate you guys coming to learn more about Research Solutions. My name is Roy Olivier. I'm the CEO. With me is Bill Nurthen, the CFO. We'll walk you through what we do. I'm going to have to wear glasses to be able to see this, so I apologize to be looking over my glasses at you. Let's start off with what do we do. Basically, we are an end-to-end AI and SaaS software platform that supports research-intensive organizations. Those can be corporations, which is about 75% of our trailing 12-month revenue, or those can be university libraries, which is 23% to 24% of our 12-month revenue. Our mission is to advance the world's research by simplifying—I'm sorry, the world's knowledge by simplifying research. A little bit on the investment opportunity.
We participate in a large and growing market, really driven by a lot of seismic changes in how people do research. Of course, the largest one is AI, which we'll talk about a little bit later. We have stable, non-cyclical demand from mission-critical R&D organizations around the world. We have a dedicated SaaS platform, which leverages a large database, some of which is proprietary, as well as a very advanced, it's actually the most advanced AI engine out there today to drive research productivity. We also have strong financial momentum as we transform the business from a transactional business to a recurring revenue business. We have a large, deeply entrenched customer base with about 1,500 customers globally today, most of which are in Europe, Middle East, Africa, or North America.
We have a multi-lever growth strategy, which combines our focus on organic growth with layering in M&A that makes sense to extend our product strategy or help us drive additional growth. A lot of the execution, since Bill and I joined the business in fiscal year 2022, has really started to show in our results. The left column, you can see the company's average results from fiscal year 2017 to fiscal year 2021. As we started 2022 to current, we have pretty significantly changed the business in that back in the day, it was a literature access platform. Today, it is a vertical SaaS and AI platform supporting research-intensive organizations. Top line has grown from 5% CAGR to 15%. Revenue stream, in terms of SaaS revenue, has grown from a little bit under $6 million to over $19 million.
I think a key metric we watch is what percentage of our total revenue is SaaS recurring revenue versus transactional revenue or overall revenue, growing from 16% to 36%. As a result of that, our gross margins have improved dramatically from around 32% to 47%, as has our profitability gone from about $700,000 to $5 million EBITDA. Because of some of the changes we're making to the product, adding additional products, and expanding our focus, we've expanded our TAM from sub-$1 billion to about $15 billion today. Our customer reach has really improved by about 50%, and a lot of the expanded TAM is a result of the last tide in the expanded market focus, where we've gone from really three verticals or segments that we supported to 13.
Within that 13 is a corporate segment, and we actually have installs in 60 different verticals underneath the corporate umbrella. What do we do? When we think about research, we think about four pillars of research: discovery, access, managing the research once I acquire it, creating my own peer-reviewed document, or creating my own drug to be patented or to be submitted for approval, as well as an underlying level of analysis that applies to every one of those steps. We acquired about 15, 16 months ago a company called Scite, which has an advanced discovery engine. It's sold via subscription, which is what the blue thing says if you can't see it in the back. Access is our oldest product, Article Galaxy. Think of that as iTunes.
Only instead of connected to music, we are connected to 200 million peer-reviewed scientific, technical, and medical peer-reviewed articles from 2,000 different publishers. You can go in, find what you want, and very quickly acquire it. We have a tool called References, which helps you manage that content once you acquire it. On the create side, we have some limited capability today, but it is really a future focus in terms of building a product for that segment. In the analysis area, Scite also has a very advanced AI analysis engine, which has made it actually the fastest-growing product in our offerings today. What is driving all this? Really, the volume of research is exploding. As AI came out, so have hallucinations. As you might—oh, I went too far, sorry.
As you might imagine, getting bad results if you're a research-intensive organization from a hallucination is not a good thing. If you use some of the off-the-shelf AI tools that are out there that search not only what they can find in terms of scientific research, but they also index the general internet, then you can get results that look like a peer-reviewed scientific article. It actually has what's called a DOI number. Think of that as an SKU number for an article, but it doesn't exist. What Scite does, which is very unique, is we focus exclusively on STM content. Therefore, we have very, very low hallucinations.
I'm not going to bore you through the product demo on the left side today, but any of you, as you think about your investment and build out your models, if you'd like to see a demo of our products, you can reach out to us and we'll get you set up. On the right side is really the important thing. What Scite has today, which OpenAI and all the AI engines do not have, is that not only do we access—not only do we have the ability to index, full-text index and search open access, which are the free articles, or abstracts, which are the summary of the articles, but we have the ability to do full-text search, what's called citation metrics, and purchase articles throughout a vast majority of the world's content.
In short, it means we can search stuff in front of the paywall and behind the paywall, whereas most AI engines today only search in front of the paywall or via the abstract. Our SaaS platform today offers a number of benefits for researchers. Basically, the value proposition of our core offering, which is finding documents, acquiring them, and managing them, is save time and save money. We save a material amount of time on a researcher-by-researcher basis, and that adds up given the fact that researchers are some of the highest-paid folks in the organization.
We can save a tremendous amount of money over time by helping companies make better decisions about where do I subscribe, where do I prepay for discounts called a token package, and how do I ensure that my research organization in Europe is not buying something I've already bought in North America or somewhere else in the world. Typically, our oldest customer cohorts show a very significant savings year over year, even seven, eight years later. On the academic and corporate side, some of those ROIs continue to exist, but the average cost savings are material. We can help reduce article spend, eliminate duplicate purchases, etc. To deal with one of the elephants in the room, I'm sure you've all heard about the Trump administration's cut to scientific research in a lot of segments.
As I mentioned, academic is our fastest-growing segment, and it's about 23% to 24% of our trailing 12-month revenue. We actually think, but we won't know, I think, for a couple of more quarters, that what he's doing will be a tailwind to our business. Let me tell you why. One of the largest checks written out of these university libraries is subscriptions to all of the major publishers. In some cases, they're writing seven-figure, eight-figure checks for these subscriptions. Even a small library is writing six-figure checks. What we can do is provide an exit ramp to save money on some of those subscriptions, but still have access to that document on a document-by-document basis. Think of it as subscribing to Paramount versus just renting the movie on iTunes.
We think that we actually will see a benefit from this in the core Article Galaxy product, which is the access product. On the research side, these same libraries typically are spending six figures for very advanced search products that have search capability that is parallel to what Scite does. Scite, being a relatively new entrant into the business, into the university library space, is a lower-cost product than the entrenched competitors. We have seen a lot of great progress and success with that product that we have reported in our previous quarterly results. By the way, our quarterly results will also be updated in about two weeks, and I will talk about this in detail in that call. As a result of that, today we are trusted by, as I mentioned, 1,500 organizations around the world. About half of our business is pharma, biotech, medical device.
The other half of the business is across about 60 different verticals. That includes university libraries, which I mentioned is about 23% to 24% of our TTM revenue, as well as a number of multinational companies. Today we serve companies from five or ten seats, very small research organizations or startups, all the way up to some of the largest pharmaceutical companies in the world. As I mentioned, our core ROI with Article Galaxy, our oldest product, is time savings and cost savings. Here's one of our customers commenting about what it's done for them. On the Scite side, what we do is we allow that organization to really focus on executing against their initiative as opposed to trying to make sense out of 200 million articles and how they relate to whatever initiative they have internally. Let's talk about market opportunity for a minute.
I mentioned earlier we think our TAM is about $15 billion. We today have two segments that we report. One is B2B, which is university library or a corporation. The other is B2C. Those are individual researchers that subscribe to the platform. The B2B business for us is about a $4 billion TAM. The individual researcher, as you might imagine, with the number of universities and students going to school in the world, is about an $11 billion TAM. I will comment that we do not count everyone. We only count what we consider to be a research-intensive organization. What that means is if a university has never published any scientific research, they're not in our TAM. If a company has never produced any scientific research, they're not in our TAM.
On the B2C side, we actually took a significant haircut to the total number of students and focused exclusively on advanced degree students in the scientific, technical, or medical space. As I mentioned before, the research-focused SaaS business is projected to grow at about 19% over the next few years, which is a nice tailwind for us. We do believe that research-focused SaaS is under-penetrated, and we've been able to service that. Lastly, once we acquire customers, they're typically highly stable. We have net renewal rates over 100%, and we typically have customer relationships that go on for, in some cases, 15-18 years. When you are doing your research, all that fine print at the bottom is links to where we came up with the TAM. If you have questions about how do we figure that out, it's all in the links.
Nearly every industry can benefit from our platform, but the common denominator is industries and corporations or universities that are research-intensive. As I mentioned, we do serve a number of vertical markets today, but the common theme is research intensity, and we can serve organizations ranging from small startups to multinationals. That means we have—Bill will talk about this in a few minutes—we have very little dependency on a few customers for our revenue. We have got a tremendous amount of revenue diversification across the business. What is going to happen in a downturn? We have all, I think, lived through some of these downturns, and in the research we did, research never stops. Even in the 2008 downturn, there was a slight decline in research in the 2008 quarters right after that, but then it has continued to increase again very quickly after that slight downturn.
I'll also say that we're certainly having a lot of conversations with the university libraries about the impact on their budgets from what's happening in Washington. On the corporate side, in the last month, our teams have met with a number of customers, including I personally have met with some of our largest customers, and they're continuing to plow ahead with building their pipeline of drugs or whatever it is for the future. Business model, we have two revenue segments that we report on. One is transaction. That is the sale of the actual scientific article. The other is platform, which is any of our software solutions that are sold under typically an annual recurring revenue agreement. Transactions today are about 64% of our revenue. It's the sale of an individual article. The revenue is generated by a transaction.
By the way, when you buy the platform, you're still buying the articles. You don't get any articles as part of our platform purchase. You simply have access to be able to buy them in one place. The growth and margin characteristics of the transaction business are very different from the software business. The transactional business for us is a flat-ish business. It's very low margin, 24% to 25% gross margin, but it throws off cash flow and EBITDA that we use to fund the platform business. Platform business, on the other hand, cloud-based, typically annual contract agreements, 85% gross margin, highly stable, and it's been a big growth engine for us. In fact, if we just take a look at the last few years, platform's 85% plus gross margin, renewal rates over 100% in terms of net renewal rates.
Key characteristics, 46% growth CAGR, highly stable, predictable cash flows, 85% gross margins, scalable. I think there is ample room for us in terms of expanding, continuing to grow the business given the size of the TAM and our market penetration, which is in the single digits. Transactional business, it is a great business in terms of helping us fund what we are trying to build out on the software side. While it is a lower margin business, it is a steady stream of cash flow that we reinvest into the SaaS platform business. It is a non-cyclical business in that our transactional business is pretty flattish. There is a little bit of variability, a little bit of seasonality to it, but it has been a pretty stable business, as you can see from the chart. Some of that growth in the chart came from an acquisition.
Some of that growth comes from new customers as we onboard the software side, and they start buying transactions through the platform. Let's talk about our moat for a second. We've got a number of moats. First off, we do have what we believe to be the world's most advanced and trusted AI engine for research. That is the Scite product. Again, be happy to give you a demo, but we do some unique things with Scite and the AI that nobody else does today. For example, if you're in the research business and you're researching a particular topic, an article pops up, it tells you how many times that article has been cited. It doesn't tell you anything about what that means.
One of the unique things that we created with Scite, which actually we now provide back to a number of publishers that put it behind their paywall on their Scite, is we provide not only the number of times the article has been cited, but we tell you how many times that other article agreed with this article, how many times it did not agree, how many times it was just mentioned, etc. It gives you what we like to refer to as either a FICO score or a Rotten Tomatoes score for the article you're looking at. Did it come out of a paper mill and it's a low-quality article, or is it a highly cited, highly confirmed article from other research out there? One of the things is 85% of all the content in the world today, you can access through our platform pretty much instantly.
The other 15% we can get for you, it just may take us one, two, three days. In fact, the STM publishing business has been around for more than a century. We're one of the very few companies that actually have runners that will go to a library to photocopy something out of a book if you need it. On the publisher relationships, we've been around about 15 years. We have relationships with virtually all of the large publishers in the space, and we have two different relationships. One is being able to sell their content through our Article Galaxy platform. It's existed for a long time. The other is, can we full-text search within Scite, their content? On the availability side, we can deliver 99.whatever % of the world content today.
On the search side, we can search a majority of the content in the world, whether it's in front of or behind that paywall. Finally, we have very sticky customers with high renewal rates that have given us a lot of our stability over the years. I'm going to speed up a little bit here, but here's a listing of some of our publishing partners, publications, and awards we've won. We will continue to focus very heavily on maintaining those relationships because they are key to our business. I'm going to ask Bill to come up and walk you through the financial.