Amazon is reportedly in talks with SmartSheet to adopt its collaboration tools for employee use.As a reminder, SmartSheet is a collaborative work management platform and no-code SaaS provider held in Titan’s Opportunities portfolio. The company caters to clients with an accessible, easy-to-use interface that provides many enhanced capabilities, such as calendar, gallery views, and charting.
To us, the potential deal suggests that the demand for enterprise software is continuing to grow, fueled by the economic reopening and the durability of remote work.SmartSheet’s increased presence within large enterprises should be a slight tailwind for future growth, as prior users are apt to recommend the product to future employers. (Dollar-based net retention is 120%, indicating a sticky user base.)
Stepping back, we believe that SMAR will continue to expand its presence within large enterprise customers, as the company’s collaboration tools can set workflows at scale across a diverse set of departments. Recent product launches indicate adoption by large companies (e.g., Uber), indicating a further increase in cross- and up-selling opportunities.
We consider the Amazon partnership as a minor positive signpost for our SMAR thesis. We see a long runway for growth, given the company’s easy-to-use product, large TAM, high dollar-based retention, and low average annualized contract value per customer.
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