Investor Deck May 2018 1 Disclaimer Forward-Looking Statements - - PowerPoint PPT Presentation

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Investor Deck May 2018 1 Disclaimer Forward-Looking Statements - - PowerPoint PPT Presentation

Investor Deck May 2018 1 Disclaimer Forward-Looking Statements This presentation contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 19 95. All statements contained in this


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May 2018

Investor Deck

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Disclaimer

Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation other than statements of historical facts, including statements regarding future results of operations and financial position of SailPoint Technologies Holdings, Inc. (“SailPoint,” “we,” “us” or “our”), our business strategy and plans, our objectives for future operations and our market opportunity, are forward-looking statements. The words “may,” “will,” “will be,” “will likely result,” “should,” “expects,” “plans,” “anticipates,” “could,” “would,” “foresees,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance, but are based on management’s current expectations, assumptions and beliefs concerning future developments and their potential effect on us, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Our expectations expressed or implied in these forward-looking statements may not turn out to be correct. Our results could be materially different from our expectations because of various risks. Important factors, some of which are beyond our control, that could cause actual results to differ materially from our historical results or those expressed or implied by these forward-looking statements include the following: our ability to attract and retain customers and our ability to deepen our relationships with existing customers;

  • ur expectations regarding our customer growth rate; our ability to maintain successful relationships with our channel partners and further develop strategic relationships; our ability to develop
  • r acquire new solutions, improve our platform and solutions and increase the value of and benefits associated with our platform and solutions; our ability to compete successfully against

current and future competitors; our plans to further invest in and grow our business, and our ability to effectively manage our growth and associated investments; our ability to adapt and respond to rapidly changing technology, evolving industry standards, changing regulations and changing customer needs; our ability to maintain and enhance our brand or reputation as an industry leader and innovator; our ability to hire, retain, train and motivate our senior management team and key employees; our ability to successfully enter new markets and manage our international expansion; adverse economic conditions in the United States, Europe or the global economy; significant changes in the contracting or fiscal policies of the public sector; actual or perceived failures by us to comply with privacy policy or legal or regulatory requirements; our ability to maintain third-party licensed software in or with our solutions; and our ability to raise additional capital or generate cash flows necessary to expand our operations and invest in new technologies. These and other important risk factors are described more fully in our reports and

  • ther documents filed with the Securities and Exchange Commission (the “SEC”), including the detailed factors discussed under (i) “Part I, Item 1A. Risk Factors” in our Annual Report on

Form 10-K for the year ended December 31, 2017, which was filed with the SEC on March 19, 2018, and (ii) “Part II, Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, which was filed with the SEC on May 9, 2018, and could cause actual results to vary from expectations. Moreover, we operate in a very competitive and rapidly changing environment, and new risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. Any forward-looking statement speaks only as of the date as of which such statement is made, and, except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events or otherwise. Industry and Market Data This presentation also contains estimates and other statistical data made by independent parties and by us relating to market size and growth and other data about our industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Neither we nor any other person makes any representation as to the accuracy or completeness of such data or undertakes any obligation to update such data after the date of this presentation. In addition, projections, assumptions and estimates of our future performance and the future performance of the markets in which we operate are necessarily subject to a high degree of uncertainty and risk. Non-GAAP Financial Measures This presentation contains certain supplemental financial measures that are not calculated pursuant to U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures, which may be different than similarly titled measures used by other companies, are in addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation of non-GAAP measures to the most directly comparable GAAP measures is contained in the Appendix.

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SailPoint secures digital identities

Identity

Governance How is Who should Who currently

Enabling

  • rganizations

to answer three critical questions

has access? have access? access being used?

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Enterprise focus

Leader in identity governance

Gartner Magic Quadrant

$10B

TAM

35+

countries

1. Please see the Endnotes in the Appendix for details on the sources and relevant dates of the figured presented 2. Please see Appendix for calculation of adjusted EBITDA

984

customers

Revenue and adjusted EBITDA margin(2)

($M) except where noted

3rd generation identity company

Robust platform Expanding market

  • pportunity

Loyal customers

95%+

maintenance renewal rate

Management team

SailPoint today(1)

$132 $186

FY16 FY17

  • Adj. EBITDA margin

41%

11% 14%

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Digital transformation increases the complexity

  • f managing

identities across the enterprise

Employees Contractors, suppliers business partners System resources Robot identities IoT devices

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Organizations need to govern these identities accessing various connected resources in hybrid environments

Mainframe apps On-prem apps Cloud apps Directories Databases Unstructured data

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Access

Management

Identity Governance

Identity management is critical to the modern enterprise

Privileged Account

Management

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Access management

APAC Americas EMEA

Homegrown commissioning tool

Close deal

Identity governance

Calculate commissions View commissions Approve commissions View personal paystub View benefits Process commissions to payroll US West US Central US East

Sales rep

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Enabling all users efficiently Protecting access to applications and data Staying compliant amidst mounting regulations

System of record for digital identities

IT operations Security Compliance

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Product leadership drivers

Comprehensive and scalable Flexible deployment: on-premises or cloud Open architecture and broad ecosystem Low total cost of ownership Address IT operations, security, and compliance

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Our open identity platform

Access Request Provisioning Access Certification Password Management Identity Governance for data in files Analytics

Governance Platform Services

SailPoint Identity Governance

Policy Model Role Model Workflow Engine Identity Warehouse Dashboard & Reporting Risk Model

Policy Management Mainframe Apps

Hybrid Environments

Cloud Apps Directories Databases On-prem Apps File Storage Operating Systems

Integration Framework

Connectors APIs Plugins SDKs Integration Modules

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ServiceNow

We are foundational to an identity-aware enterprise

APIs SDKs Plugins

(ArcSight)

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Large and growing market

$9 B

Identity and access management Data-centric audit and protection Total addressable market

+11%

annual growth through 2020

+ =

$8.8B $1.2B $10B

+20%

annual growth in 2016

1. Forrester, “Identity and Access Management Software Forecast”, 2017 2. Gartner, “Market Guide for Data-Centric Audit and Protection”, 2017 3. Per S&P Global Market Intelligence

(1) (2)

Over 80,000 addressable companies globally (≥ 1,000 employees) 65,000 companies in our existing markets

Less than 2% penetrated today

(3) (3)

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Market segment Market opportunity Competitors Sales strategy

  • Ripe for disruption
  • First-gen provisioning

replacement

  • Compliance and data

governance greenfield

  • Greenfield
  • Oracle
  • IBM
  • CA
  • Homegrown
  • Manual

processes

  • Direct sales force:

account executives

  • Global SIs
  • Direct sales force:

territory managers & inside sales

  • Resellers and

boutique SIs

Our market focus

Large enterprise

(7,500+ employees)

Mid-market enterprise

(1,000 - 7,500 employees)

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Technology partners System integrators Resellers

Established partner network that provides significant leverage

  • ver 80% of new deals involved partners
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CUSTOMERS(3)

984

Global customer base

7/15 4/6

TOP HEALTHCARE INSURANCE AND MANAGED CARE PROVIDERS(1)

9/15 5/15

TOP PHARMACEUTICAL COMPANIES(1)

11/15

LARGEST U.S. FEDERAL GOVERNMENT AGENCIES(2)

1. Based on Fortune’s 2017 Global 500 list 2. Federal agency rankings based on employee count provided in most recent Employment and Trends report from US OPM 3. Customer count as of 3/31/2018

TOP PROPERTY AND CASUALTY INSURANCE PROVIDERS(1) TOP BANKS(1)

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Customer case studies

Fortune 500 Manufacturer

Problem:

  • Outdated legacy solution
  • Manual security processes

SailPoint solution:

  • Modern, governance-based platform
  • Automated 60K+ requests
  • Estimated $1M savings annually

Fortune 500 Transportation Company

Problem:

  • Internally developed solution
  • Compliance deficiencies

SailPoint solution:

  • Visibility / control over 450K users
  • Elimination of SoD violations
  • Addresses scale and complexity

International Consumer Brand

Problem:

  • Mid-market customer
  • Need for “cloud-first” governance

SailPoint solution:

  • Management of hybrid environment
  • Reduced processing time

(months to < 1 day)

  • Risk-based compliance
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Extend global presence Sell to new customers Expand within existing customers Leverage partner network Invest in platform and products

Multiple growth drivers

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Financial highlights

Attractive combination of growth and profitability(1) Increasing recurring revenue and visibility Global customer base Broad vertical representation High customer retention rate

1. Based on adjusted EBITDA
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1. Small portion of IdentityIQ and SecurityIQ sold on a term license basis

Our business model

Products Perpetual license & maintenance (1) SaaS Revenue models

Compliance Controls Provisioning Access Request Password Management

Identity Analytics

Modules

Compliance Controls Provisioning Access Request Password Management Exchange SharePoint Windows and Unix File Shares Active Directory Cloud Storage Systems

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$132 $186

FY '16 FY '17

$35 $50

Q1 '17 Q1 '18

41% Sustained revenue growth

Annual revenue ($M) Quarterly revenue ($M)

40%

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Growing and diversified customer base

Customer count

1. Current customer count and industry composition percentages as of 3/31/2018

Customer composition

(1) (1)

520 695 933 984 FY '15 FY '16 FY '17 Q1 '18

Manufacturing, Energy and Industrials 17% Banking 15% Government, Education and Non-Profit 13% Technology, Media and Telecom 12% Finance 11% Healthcare 10% Insurance 10% Retail and Consumer 8% Other 4%

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Powerful land and expand opportunity

Cumulative license revenue

$0.0 $0.5 $1.0 $1.5 $2.0 $2.5

Year 1 Year 2 Year 3 Year 4 Year 5

Global insurance customer

$0.0 $0.5 $1.0 $1.5 $2.0 $2.5

Year 1 Year 2 Year 3 Year 4 Year 5

Multinational telecommunications customer

7.6x 5-Year purchase multiple 12.4x 5-Year purchase multiple

($M, unless otherwise noted)

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Total non-GAAP gross margin (%)

1. Please see Appendix for GAAP to non-GAAP reconciliations

(1)

Attractive gross and EBITDA margins

Total adjusted EBITDA margin (%)

(1)

75% 79% FY '16 FY '17 75% 78% Q1 '17 Q1 '18 11% 14% FY '16 FY '17 9% 7% Q1 '17 Q1 '18

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Appendix

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Reconciliation of non-GAAP gross margin

FY2016 FY2017 Q12017 Q12018 GAAP revenue $132,412 $186,056 $35,466 $49,714 GAAP total cost of revenue 37,038 44,590 10,135 12,770 GAAP gross profit $95,374 $141,466 $25,331 $36,944 GAAP gross margin 72% 76% 71% 74% FY2016 FY2017 Q12017 Q12018 GAAP total cost of revenue $37,038 $44,590 $10,135 $12,770 Stock-based compensation (97) (591) (27) (496) Amortization of acquired intangibles (4,416) (4,416) (1,104) (1,104) Non-GAAP cost of revenue $32,525 $39,583 $9,004 $11,170

($ ‘000’s)

1. Non-GAAP gross profit = GAAP revenue – non-GAAP cost of revenue 2. Non-GAAP gross margin = non-GAAP gross profit / GAAP revenue

FY2016 FY2017 Q12017 Q12018 Non-GAAP gross profit (1) $99,887 $146,473 $26,462 $38,544 Non-GAAP gross margin (2) 75% 79% 75% 78%

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Reconciliation of adjusted EBITDA

Adjusted EBITDA FY2016 FY2017 Q12017 Q12018 Net loss $(3,173) $(7,592) $(2,283) $(5,967) Income tax (benefit) expense (1,985) 2,293 (239) 352 Interest expense, net 7,277 14,783 2,657 1,178 Amortization 9,092 8,841 2,221 2,206 Depreciation 890 1,379 255 421 Purchase accounting adjustment 1,373 141 55 13 Acquisition and sponsor related costs 1,093 1,142 328

  • Stock-based compensation

568 4,514 158 5,139 Adjusted EBITDA $15,135 $25,501 $3,152 $3,342 GAAP Revenue $132,412 $186,056 $35,466 $49,714 Adjusted EBITDA margin(1) 11% 14% 9% 7%

($ ‘000’s)

1. Adjusted EBITDA margin = adjusted EBITDA / GAAP revenue
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Endnotes

Referenced from Page 4:

Robust Platform: 1. Gartner, “Magic Quadrant for Identity Governance and Administration”, 2018 Expanding Market Opportunity: 1. Forrester, “Identity and Access Management Software Forecast”, 2017 2. Gartner, “Market Guide for Data-Centric Audit and Protection”, 2017 Enterprise Focus: 1. Customers: As of 3/31/2018 2. Countries: As of 3/31/2018 Loyal Customers: 1. Maintenance Renewal Rate: For IdentityIQ for the year ended December 31, 2017