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Tom M. Roderick | (312) 564-8701 | [email protected] Matthew Van Vliet, CFA | (312) 564-8706 | [email protected] Stifel Equity Trading Desk | (800) 424-8870

November 8, 2017 Software: Applications

Workiva Inc. WK – NYSE

BUY

ANALYSIS OF SALES/EARNINGS 3Q Beats, Subscription Mix Improving. But Those Pesky Margins...

.Financial Summary

Changes Previous Current

Rating — Buy Target Price $23.00 $24.00 FY17E Revenue $205.7 $206.8 FY18E Revenue — $236.0 FY17E EPS $(0.62) $(0.63) FY18E EPS — $(0.47)

Price ( 11/07/17 ): $22.60 52-Week Range: $23 - $12 Market Cap.(mm): 945.0 Shr.O/S-Diluted (mm): 41.8 Enterprise Val. (mm): $888.0 Avg Daily Vol (3 Mo): 108,920 Net Cash/Share: $1.36 Dividend / Yield: $0.00 / 0.0%

EPS 2016A 2017E 2018E Q1 $(0.21) $(0.04)A $(0.09) Q2 $(0.20) $(0.14)A $(0.09) Q3 $(0.23) $(0.23)A $(0.15) Q4 $(0.09) $(0.22) $(0.14) FY (Dec) $(0.73)A $(0.63) $(0.47) P/E NM NM NM

Revenue 2016A 2017E 2018E Q1 $44.6 $51.9A $59.0 Q2 $43.0 $49.4A $57.0 Q3 $44.7 $52.1A $59.0 Q4 $46.4 $53.4 $61.0 Revenue $178.6A $206.8 $236.0 EV/Rev 5.0x 4.3x 3.8x

Price Performance

10 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17

2.5

1.5

0.5

Price Volume

Volume (Mil.) Price (USD) WK

Summary On Tuesday, November 7th, after the market close, Workiva announced 3Q17 earnings results that exceeded our estimates and guidance for revenue and margins. The outperformance in the quarter allowed management to raise its FY17 guidance. However, it did so to a lesser extent than 3Q results beat the Street, leaving 4Q guidance below consensus due to weaker services expectations and increased investments in headcount across much of the company. Expectations remain for positive operating cash flow but likely to a lesser magnitude than previously projected and yet another small step back in the march to profitability. We maintain our Buy rating and raise our target price to $24 on elevated 2018 subscription estimates and higher multiples across the SaaS group.

Key Points 3Q Beats with solid revenue and significant margin expansion. • Total revenue of $52.1mn (up 16.5% y/y) compares to Street at $50.6mn and guidance of

$50.4mn–$50.8mn.

• Subscription revenue of $43.2mn (up 19.3% y/y) beat the Street at $41.7mn. The subscription mix of 83.0% compares to 81.0% in 3Q16. Services revenue of $8.9mn was in line with the Street.

• Gross margins of 70.6%, down from 72.0% in 3Q16, as headcount additions across the business to address newer use cases and end markets outweighed the benefits from a higher mix of subscription.

• Adjusted operating income of $(9.1)mn was well ahead of the Street at $(12.0)mn and guidance of $(12.2)mn–$(11.8)mn. EPS of $(0.23) was ahead of consensus at $(0.29) and guidance of $(0.30)–$(0.29).

• CFFO was $5.2mn compared to consensus at $0.0mn, up from $(0.1)mn in 3Q16 and up from 2Q17 of $4.0mn, again boosted by the ongoing transition to annual contracts from quarterly collections.

Key takeaways from conference call: • New deals continue to be fairly evenly split between SEC and non-SEC use cases with

management highlighting deals for Corporate Performance Management (CPM), SOX compliance, general finance and accounting, and risk & compliance reporting along with SEC reporting with large and small public companies alike as well as with private companies and state & local governments.

• Key SOX reporting wins included JM Smucker, Chorus Aviation, Newpark Resources, and Methode Electronics.

• Wdesk CPM customers now include Alaska Airlines, Fiat-Chrysler, and Mary Kay. • Gross revenue retention rate of 96.5% compares to 95.1% in 3Q16 and 96.1% in 2Q17,

and Net revenue retention (including up-sells) of 108.6% compares to 110.2% in 3Q16 and 106.0% in 2Q17.

• Total customer count ended the quarter at 2,991, up 11% y/y and 2.9% sequentially. • Subscription mix from new customers was 52% compared to 46% in 3Q16.

All relevant disclosures and certifications appear on pages 9 - 11 of this report.

Stifel does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

Investment Thesis Workiva's collaborative workflow platform remains an industry-leading solution for SEC reporting, SOX compliance, and other statutory, regulatory and compliance reporting. The expanding use cases are helping to drive sustained mid-teens subscription growth for the next several years leading to ongoing margin expansion and positive cash flows.

FY17 Guidance raised but by less than 3Q17 beat due to ongoing investments in headcount and S&M spending. • Management raised its FY17 revenue guidance to $206mn–$208mn (from $205mn–$206mn), representing growth of 15%–16.5%,

compared to Street estimates of $205.4mn, after 3Q17 beat by $1.5mn.

• Operating loss guidance of $(25.6)mn–$(25.2)mn (from $(26.0)mn–$(25.0)mn) compared to Street at $(25.5)mn and EPS of $(0.64)– $(0.63) (from $(0.64)–$(0.62)) vs. Street at $(0.63).

• 4Q17 guidance of $53.0mn-$53.4mn in revenue and $(0.23)–$(0.22) compared to Street expectations of $53.5mn and $(0.15). • Preliminary 2018 revenue guidance is expected to be in line with current Street estimates of $233mn–$237mn, representing about 13%–

15% growth.

WK 3Q17A: Actual Vs. Forecast ($000s) WK 3Q17A: Quarterly Comparisons ($000s)

Actual Estimate Variance % 3Q17A % of Revs 2Q17A Growth 3Q16A Growth

Subscription and Support $43,214 $42,200 $1,014 2.3% Subscription and Support $43,214 83.0% $40,980 5.5% $36,237 19.3%

Professional Services $8,854 $8,600 $254 2.9% Professional Services $8,854 17.0% $8,411 5.3% $8,473 4.5%

Total Revenue $52,068 $50,800 $1,268 2.4% Total Revenue $52,068 100.0% $49,391 5.4% $44,710 16.5%

Total Cost of Revenue $15,319 $14,726 $593 3.9% Total Cost of Revenue $15,319 29.4% $14,008 9.4% $12,512 22.4%

Gross profit - Subscription/Support $34,946 $34,182 $764 2.2% Gross profit - Subscription/Support $34,946 67.1% $33,400 4.6% $29,665 17.8%

Gross profit - Prof. Services $1,803 $1,892 ($89) -4.9% Gross profit - Prof. Services $1,803 3.5% $1,983 (9.1%) $2,533 (28.8%)

Gross profit $36,749 $36,074 $675 1.8% Gross profit $36,749 70.6% $35,383 3.9% $32,198 14.1%

Research and development $16,926 $16,764 $162 1.0% Research and development $16,926 32.5% $15,767 7.4% $13,748 23.1%

Sales and marketing $22,924 $24,384 ($1,460) -6.4% Sales and marketing $22,924 44.0% $19,093 20.1% $21,787 5.2%

General and administrative $6,017 $6,604 ($587) -9.8% General and administrative $6,017 11.6% $5,990 0.5% $5,728 5.0%

Total Operating Expenses $45,867 $47,752 ($1,885) -4.1% Total Operating Expenses $45,867 88.1% $40,850 12.3% $41,263 11.2%

Operating Profit ($9,118) ($11,678) $2,560 NM Operating Profit ($9,118) (17.5%) ($5,467) NM ($9,065) NM

Interest expense ($464) ($475) $11 NM Interest expense ($464) (0.9%) ($475) NM ($462) NM

Other income (expense) $198 $176 $22 11.1% Other income (expense) $198 0.4% $176 12.5% $298 (33.6%)

Pre-tax income ($9,384) ($11,977) $2,593 NM Pre-tax income ($9,384) (18.0%) ($5,766) NM ($9,229) NM

Income Taxes $25 $60 ($35) -139.5% Income Taxes $25 0.0% $33 (24.2%) ($8) (412.5%)

Net income ($9,409) ($12,037) $2,628 NM Net income ($9,409) (18.1%) ($5,799) NM ($9,221) NM

EPS ($0.23) ($0.29) $0.06 NM EPS ($0.23) (0.0%) ($0.14) NM ($0.23) NM

Shares Outstanding, Fully Diluted 41,815 42,000 (185) -0.4% Shares Outstanding, Fully Diluted 41,815 NA 41,430 0.9% 40,763 2.6%

EBITDA ($8,264) ($10,611) $2,347 NM EBITDA ($8,264) (15.9%) ($4,600) NM ($8,121) NM

Gross margin 70.6% 71.0% (0.4%) Gross margin 70.6% 71.6% (106) 72.0% (144)

Research and development 32.5% 33.0% (0.5%) Research and development 32.5% 31.9% 58 30.7% 176

Sales and marketing 44.0% 48.0% (4.0%) Sales and marketing 44.0% 38.7% 537 48.7% (470)

General and administrative 11.6% 13.0% (1.4%) General and administrative 11.6% 12.1% (57) 12.8% (126)

Operating margin (17.5%) (23.0%) 5.5% Operating margin (17.5%) (11.1%) (644) (20.3%) 276

Source: Company data, Stifel estimates Source: Company data

Q/Q Comparison Y/Y Comparison

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

WK Model Changes ($000s)

Current Previous Variance Current Previous Variance Current Previous Variance

Subscription and Support $45,000 $44,980 $20 $168,734 $167,700 $1,034 $196,000 $194,500 $1,500

Professional Services $8,400 $8,625 ($225) $38,029 $38,000 $29 $40,000 $41,500 ($1,500)

Total Revenue $53,400 $53,605 ($205) $206,763 $205,700 $1,063 $236,000 $236,000 $0

Total Cost of Revenue $15,915 $14,842 $1,073 $59,220 $57,554 $1,666 $65,260 $65,166 $94

Gross profit - Subscription/Support $36,225 $36,434 ($209) $136,614 $136,059 $555 $159,152 $157,545 $1,607

Gross profit - Prof. Services $1,260 $2,329 ($1,069) $10,929 $12,087 ($1,158) $11,588 $13,289 ($1,701)

Gross profit $37,485 $38,763 ($1,278) $147,543 $148,146 ($603) $170,740 $170,834 ($94)

Research and development $17,088 $16,618 $470 $64,824 $64,192 $632 $69,970 $69,600 $370

Sales and marketing $22,362 $21,442 $920 $82,433 $82,973 ($540) $92,710 $90,906 $1,804

General and administrative $6,835 $6,861 ($26) $25,516 $26,129 ($613) $27,563 $28,320 ($757)

Total Operating Expenses $46,285 $44,921 $1,364 $172,773 $173,294 ($521) $190,243 $188,826 $1,417

Operating Profit ($8,800) ($6,158) ($2,642) ($25,230) ($25,148) ($82) ($19,503) ($17,992) ($1,511)

Interest expense ($464) ($475) $11 ($1,858) ($1,880) $22 ($1,600) ($3,300) $1,700

Other income (expense) $198 $176 $22 $1,184 $1,140 $44 $1,400 $1,324 $76

Pre-tax income ($9,066) ($6,457) ($2,609) ($25,904) ($25,888) ($16) ($19,703) ($19,968) $265

Income Taxes $45 $32 $13 $112 $134 ($22) $138 $100 $38

Net income ($9,111) ($6,490) ($2,622) ($26,016) ($26,023) $6 ($19,841) ($20,068) $227

EPS ($0.22) ($0.15) ($0.07) ($0.63) ($0.62) ($0.01) ($0.47) ($0.47) $0.00

Shares Outstanding, Fully Diluted 42,015 42,400 (385) 41,592 41,735 (142) 42,165 42,550 (385)

EBITDA ($7,785) ($5,140) ($2,645) ($21,603) ($21,305) ($298) ($15,194) ($13,683) ($1,511)

Gross margin 70.2% 72.3% (2.1%) 71.4% 72.0% (0.7%) 72.3% 72.4% (0.0%)

Research and development 32.0% 31.0% 1.0% 31.4% 31.2% 0.1% 29.6% 29.5% 0.2%

Sales and marketing 41.9% 40.0% 1.9% 39.9% 40.3% (0.5%) 39.3% 38.5% 0.8%

General and administrative 12.8% 12.8% 0.0% 12.3% 12.7% (0.4%) 11.7% 12.0% (0.3%)

Operating margin (16.5%) (11.5%) (5.0%) (12.2%) (12.2%) 0.0% (8.3%) (7.6%) (0.6%)

Source: Stifel estimates

4Q17E 2017E 2018E

Target Price Methodology/Risks Our 12-month target price of $24 is based on an EV/revenue multiple of 4.0x our FY18 revenue estimate of $236 million. Risks to our target price include increased competition from existing or new providers developing more complete solutions, difficulty in cross-selling additional products to new and existing customers, continued unprofitability limiting growth, and indeterminate returns from ongoing internal growth investments.

Company Description Workiva Inc. (WK) sells a suite of solutions, branded Wdesk, that supplement and eventually look to replace Microsoft Office products, Excel, Word, and PowerPoint usage in the accounting, finance, investor relations, and other internal and external reporting groups at publicly traded enterprises. Workiva operates its business on a software-as-a-service (SaaS) model. Customers enter into quarterly, annual, and multi-year subscription contracts to utilize Wdesk. As of 1Q17, there were nearly 2,800 customers using Wdesk generating more than $185 million in total revenue over the trailing four quarters.

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

Communications & Applications Software

Analyst: Tom Roderick 312-564-8701 Associate: Matt VanVliet, CFA 312-564-8706 Associate: J. Parker Lane, 312-564-8705

Price Net 16A 16A

11/7/17 Cash/ Sh TEV ($mn) 15A-'16A 16A-'17E 17E-'18E 16A 17E 18E 16A 17E 18E 16A 17E 18E 16A 17E 18E 16A 17E 18E

P/E/G

(rev)

P/CF/G

(rev)

Enterprise Applications Rating

Enterprise Applications- On-Premise

Guidewire H GWRE* $80.08 $9.08 $5,380 13.6% 23.3% 19.9% 18.5% 15.4% 17.3% 12.0x 9.7x 8.1x 96.5x NA 78.5x 61.7x 63.7x 55.8x 59.7x 58.1x 43.5x 7.1x 4.5x

Nuance Communications H NUAN* $14.96 ($5.96) $6,079 0.0% -1.1% 3.0% 28.5% 25.8% 27.5% 3.1x 3.1x 3.0x 12.9x 14.5x 12.1x 8.7x 11.4x 9.4x 9.0x 10.0x 9.7x NM NM

PROS RM H PRO* $23.53 ($1.66) $803 -10.9% 9.3% 11.1% (26.7%) (23.3%) (15.8%) 5.2x 4.8x 4.3x NA NA NA NA NA NA NA NA NA NA NA

Tableau Software B DATA* $70.27 $11.25 $4,948 26.5% 4.9% 8.7% 5.6% 1.4% 3.6% 6.0x 5.7x 5.2x NA NA NA 0.0x 0.0x 0.0x 55.3x NA 61.6x NA 0.0x

Citrix Systems H CTXS# $84.48 $0.56 $12,976 4.4% -17.4% 3.3% 30.8% 31.0% 30.0% 3.8x 4.6x 4.4x 15.9x 17.5x 17.5x 13.5x 13.6x 13.1x 10.6x 12.6x 13.2x 3.7x 3.1x

Hortonworks NC HDP $17.97 $0.93 $1,157 51.3% 39.1% 26.9% (79.8%) (35.4%) (19.0%) 6.3x 4.5x 3.6x NA NA NA NA NA NA NA NA 48.3x NA NA

IBM B IBM### $151.35 ($36.55) $175,355 -2.2% -1.6% 0.5% 18.4% 18.6% 19.3% 2.2x 2.2x 2.2x 11.1x 11.0x 10.8x 12.2x 11.7x 12.1x 9.2x 9.3x 9.1x NA NA

Microsoft B MSFT# $84.27 $6.38 $607,499 2.0% 6.8% 8.1% 31.2% 31.7% 32.0% 6.4x 6.0x 5.6x 29.1x 24.7x 24.0x 25.0x 20.6x 18.7x 16.8x 15.2x 13.8x NM NM

Microstrategy NC MSTR $133.71 $56.25 $891 -3.3% -2.2% 0.3% 22.9% 14.7% 7.6% 1.7x 1.8x 1.8x 17.0x 26.7x 66.8x 14.2x 15.0x 20.7x 6.7x 10.3x 13.7x NA NA

Oracle B ORCL# $50.49 $3.18 $202,693 0.3% 3.2% 3.8% 42.2% 42.8% 44.1% 5.4x 5.2x 5.0x 19.3x 17.5x 16.4x 17.4x 16.6x 15.6x 12.0x 11.3x 10.6x NM NM

Red Hat B RHT# $121.92 $4.93 $21,411 17.6% 19.2% 16.5% 22.6% 23.1% 23.8% 9.1x 7.6x 6.5x 55.9x 46.1x 38.9x 31.6x 28.1x 24.0x 34.0x 27.8x 24.6x 3.2x 1.8x

SAP S SAP# $114.22 ($2.84) $140,240 5.0% 16.7% 4.9% 30.0% 29.0% 29.6% 5.9x 5.1x 4.8x 26.9x 23.4x 21.7x 35.5x 29.9x 25.2x 18.1x 15.9x 14.5x 5.4x 7.1x

Splunk H SPLK# $68.00 $7.79 $8,373 42.5% 28.5% 28.0% 5.9% 7.8% 10.0% 9.0x 7.0x 5.5x NA NA 84.3x 60.8x 43.0x 33.3x NA 62.9x 43.2x NA 1.4x

Talend NC TLND $43.60 $3.30 $1,164 NA 38.8% 29.4% (21.4%) (15%) (6.9%) 11.0x 7.9x 6.1x NA NA NA NA NA NA NA NA NA NA NA

Teradata H TDC# $34.62 $2.38 $4,056 -10.9% -4.8% 1.7% 20.9% 10.8% 10.7% 1.8x 1.9x 1.9x 13.6x 26.6x 24.8x 13.8x 19.9x 18.9x 6.8x 11.0x 10.6x NA NA

Tyler Technologies NC TYL $172.66 $4.18 $6,628 27.9% 11.6% 10.7% 28.2% 28.0% 29.0% 8.8x 7.9x 7.1x 49.1x 44.2x 40.1x NA 45.6x 34.8x 29.7x 26.3x 23.0x 1.8x NA

Vmware B VMW# $120.43 $17.93 $42,308 6.7% 1.8% 13.8% 32.3% 30.1% 32.8% 6.0x 5.9x 5.2x 27.4x 23.8x 22.0x 22.8x 20.1x 17.7x 16.3x 15.8x 14.2x 4.1x 3.4x

Enterprise Applications- On-Premise Median: 4.7% 6.8% 8.7% 22.6% 18.6% 19.3% 6.0x 5.2x 5.0x 23.1x 23.8x 24.0x 17.4x 20.0x 18.8x 16.3x 15.2x 14.2x 3.9x 3.1x

Mean: 10.7% 10.3% 11.2% 12.4% 13.9% 16.2% 6.1x 5.3x 4.7x 31.2x 25.1x 35.2x 24.4x 24.2x 21.4x 21.8x 22.0x 23.6x 4.2x 3.1x

Enterprise Applications- All exc. Communications Median: 22.0% 16.2% 17.6% 12.2% 10.8% 10.0% 7.6x 6.1x 5.3x 40.6x 43.6x 43.3x 33.6x 35.0x 31.7x 29.2x 26.9x 22.7x 3.2x 2.1x

Mean: 19.9% 17.7% 16.8% 8.9% 8.3% 9.9% 7.8x 6.3x 5.3x 43.3x 42.0x 46.1x 36.6x 38.4x 38.0x 30.2x 28.7x 26.5x 3.5x 2.7x

Enterprise Applications - Communications

Amdocs B DOX* $62.95 $6.54 $8,307 2.5% 4.1% 3.6% 17.1% 17.2% 17.4% 2.2x 2.1x 2.1x 17.4x 16.2x 15.6x 20.2x 18.9x 17.7x 11.2x 10.6x 10.1x 6.9x 8.0x

CSG Systems B CSGS* $43.45 ($2.30) $1,505 1.1% 3.0% 3.3% 21.6% 18.2% 18.5% 2.0x 1.9x 1.9x 15.6x 17.2x 16.3x 20.4x 14.8x 11.9x 7.7x 8.6x 8.2x NM NM

Synchronoss H SNCR* $10.07 ($1.72) $571 5.5% -22.5% -2.3% 21.3% 16.2% 19.0% 0.9x 1.2x 1.2x 5.1x 14.2x 12.9x 5.8x 16.5x NA 3.1x 4.9x 4.6x 0.9x 1.1x

Broadsoft NC BSFT $54.85 $5.13 $1,550 22.3% 12.3% 12.7% 21.8% 20.7% 21.7% 4.5x 4.0x 3.6x 24.0x 24.5x 21.4x NA NA NA 18.1x 17.3x 15.2x 1.1x NA

Five9 NC FIVN $25.54 $0.21 $1,386 25.8% 20.2% 17.6% 0.3% 1.9% 2.9% 8.6x 7.1x 6.1x NA NA NA NA NA 77.4x NA NA NA NA NA

RingCentral NC RNG $44.30 $2.20 $3,194 28.2% 29.7% 23.7% 1.9% 2.9% 4.3% 8.4x 6.5x 5.2x NA NA NA NA NA NA NA NA 69.8x NA NA

Enterprise Applications- Communications Median: 5.5% 4.1% 3.6% 19.2% 16.7% 18.0% 3.4x 3.1x 2.8x 16.5x 16.7x 16.0x 20.2x 16.5x 17.7x 9.5x 9.6x 10.1x 1.1x 4.5x

Mean: 11.4% 3.4% 7.0% 14.0% 12.9% 14.0% 4.4x 3.8x 3.3x 15.5x 18.0x 16.6x 15.5x 16.7x 35.7x 10.0x 10.3x 21.6x 3.0x 4.5x

B = Buy, H = Hold, S = Sell, NC = Not Covered

# Followed by Stifel analyst Brad Reback, ### Followed by Stifel analyst David Grossman

Source: Company data, FactSet, (*)Stifel estimates

Revenue Growth Oper. Margin TEV / Sales P/E P/FCF EV/EBITDA

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

Communications & Applications Software

Analyst: Tom Roderick 312-564-8701 Associate: Matt VanVliet, CFA 312-564-8706 Associate: J. Parker Lane, 312-564-8705

Price Net 16A 16A

11/7/17 Cash/ Sh TEV ($mn) 15A-'16A 16A-'17E 17E-'18E 16A 17E 18E 16A 17E 18E 16A 17E 18E 16A 17E 18E 16A 17E 18E

P/E/G

(rev)

P/CF/G

(rev)

Enterprise Applications Rating

Enterprise Applications - Subscription-based

Adobe Systems B ADBE* $180.88 $6.95 $87,033 22.1% 23.8% 20.1% 33.8% 37.4% 40.6% 14.9x 12.0x 10.0x 59.9x 43.0x 32.9x 45.6x 33.8x 28.8x 37.7x 28.3x 21.5x 2.7x 2.1x

Amber Road B AMBR* $7.26 $0.19 $194 6.7% 7.9% 10.1% (14.1%) (7.9%) (3.1%) 2.7x 2.5x 2.2x NA NA NA NA NA 83.0x NA NA 68.0x NA NA

Brightcove B BCOV* $7.40 $0.64 $233 11.6% 3.4% 7.5% 0.7% (7.3%) (0.6%) 1.6x 1.5x 1.4x NA NA NA 42.7x NA NA 41.0x NA 35.9x NA 3.7x

Blackbaud B BLKB* $98.67 ($6.71) $5,042 13.5% 7.6% 10.4% 19.6% 20.7% 21.8% 6.9x 6.4x 5.8x 51.4x 45.3x 39.2x 42.4x 36.2x 31.7x 29.2x 26.1x 22.4x 3.8x 3.2x

Everbridge B EVBG* $27.53 $1.71 $726 30.9% 35.0% 25.3% (5.8%) (6.6%) (4.4%) 9.4x 7.0x 5.6x NA NA NA NA NA 74.1x NA NA NA NA NA

Hubspot B HUBS* $82.75 $5.03 $3,066 48.9% 36.9% 26.9% (4.4%) 1.8% 4.3% 11.3x 8.3x 6.5x NA NA NA NA NA 96.4x NA NA NA NA NA

Q2 Holdings B QTWO* $42.00 $1.89 $1,742 38.0% 29.2% 23.1% (8.0%) (0.2%) 1.9% 11.6x 9.0x 7.3x NA NA NA NA NA NA NA NA NA NA NA

Salesforce.com B CRM* $102.72 $2.30 $73,248 25.9% 23.9% 19.2% 13.2% 14.5% 15.8% 8.7x 7.0x 5.9x NA 78.4x 61.9x 42.3x 36.6x 30.3x 42.0x 31.7x 25.1x NA 1.6x

ServiceNow H NOW* $125.53 $5.21 $21,708 38.3% 38.3% 30.3% 13.0% 16.0% 19.0% 15.6x 11.3x 8.7x NA NA 72.6x 67.6x 47.9x 33.5x NA 51.3x 34.4x NA 1.8x

SPS Commerce B SPSC* $47.90 $9.41 $670 21.9% 13.7% 9.8% 10.5% 11.6% 13.0% 3.5x 3.0x 2.8x 66.5x 52.1x 45.2x 77.3x 49.4x 39.6x 25.3x 20.7x 17.2x 3.0x 3.5x

Veeva Systems B VEEV* $61.27 $4.71 $8,697 32.9% 23.9% 18.7% 29.4% 30.0% 31.0% 16.0x 12.9x 10.9x 82.7x 70.4x 59.5x 65.6x 44.6x 42.5x 49.5x 39.7x 32.0x 2.5x 2.0x

Workiva B WK* $22.60 $1.36 $888 23.0% 15.7% 14.1% (16.4%) (12.2%) (8.3%) 5.0x 4.3x 3.8x NA NA NA NA NA NA NA NA NA NA NA

Zendesk H ZEN* $34.24 $2.25 $3,220 49.4% 36.9% 28.6% (6.8%) (4.4%) (1.0%) 10.3x 7.5x 5.9x NA NA NA NA NA NA NA NA NA NA NA

Cloudera B CLDR# $15.17 $2.93 $1,646 NA NA 28.1% NA (35.5%) (35.5%) NA 4.7x 3.7x NA NA NA NA NA NA NA NA NA NA NA

Channeladvisor B ECOM# $8.70 $2.02 $177 12.5% 8.4% 7.6% (0.3%) (1.8%) (1.8%) 1.6x 1.4x 1.3x 46.7x NA NA 19.8x NA 25.6x 23.8x 36.2x 22.1x 3.7x 1.6x

Paycom B PAYC# $79.87 $0.55 $4,670 46.5% 31.5% 28.2% 24.5% 26.0% 26.0% 14.2x 10.8x 8.4x 91.8x 63.5x 52.4x NA 90.8x 61.3x 49.4x 35.2x 28.0x 2.0x NA

Paylocity B PCTY# $48.10 $1.78 $2,529 38.7% 25.9% 22.2% 11.5% 14.1% 14.1% 9.5x 7.6x 6.2x NA 63.1x 49.8x NA 66.9x 55.0x 59.6x 38.6x 29.7x NA NA

Ultimate Software B ULTI# $196.13 $4.18 $5,906 26.4% 19.5% 18.8% 20.2% 19.5% 19.5% 7.6x 6.3x 5.3x 61.7x 54.5x 43.3x 65.6x 58.1x 44.8x 32.2x 27.5x 21.6x 2.3x 2.5x

Workday H WDAY# $108.53 $7.48 $20,919 35.8% 33.7% 29.3% 2.6% 7.7% 7.7% 13.6x 10.2x 7.9x NA NA 100.0x NA 86.9x 76.6x NA 68.5x 47.4x NA NA

Alteryx NC AYX $21.60 $2.62 $1,106 NA 46.4% 35.9% (23.0%) (14.7%) (14.7%) 12.9x 8.8x 6.5x NA NA NA NA NA NA NA NA NA NA NA

Aspen Technology NC AZPN $65.28 ($1.10) $4,886 4.9% 2.0% 3.9% 49.7% 48.4% 48.4% 10.2x 10.0x 9.6x 33.6x 27.9x 31.4x 29.6x 26.1x 24.4x 20.5x 20.4x 19.8x 6.8x 6.0x

BlackLine NC BL $34.62 $2.09 $1,711 NA 41.7% 28.6% (9.9%) (3.1%) (3.1%) 13.9x 9.8x 7.6x NA NA NA NA NA NA NA NA NA NA NA

Cornerstone OnDemand NC CSOD $37.30 $1.17 $2,057 24.6% 13.7% 15.6% 1.8% 5.9% 5.9% 4.9x 4.3x 3.7x NA 93.9x 50.4x 17.0x 76.1x 35.2x 65.0x 37.9x 24.9x NA 0.7x

Coupa NC COUP $12.01 $3.95 $425 NA NA 33.0% NA (14.7%) (14.7%) NA 2.6x 1.9x NA NA NA NA NA NA NA NA NA NA NA

Ellie Mae NC ELLI $87.78 $10.23 $2,775 41.9% 14.3% 19.7% 25.7% 19.6% 19.6% 7.7x 6.7x 5.6x 40.6x 57.1x 52.6x 68.0x NA 86.9x 24.5x 23.1x 19.6x 1.0x 1.6x

LivePerson NC LPSN $11.40 $0.99 $589 -6.8% -2.1% 7.3% 1.4% 2.2% 2.2% 2.6x 2.7x 2.5x NA NA 97.3x 51.8x NA NA 30.7x 32.5x 26.4x NA NA

Twilio NC TWLO $28.38 $3.18 $2,290 NA 35.0% 24.8% (4.4%) (5.8%) (5.8%) 8.3x 6.1x 4.9x NA NA NA NA NA NA NA NA NA NA NA

Yext NC YEXT $12.01 $1.41 $954 NA NA 33.0% NA (25.8%) (25.8%) NA 5.7x 4.3x NA NA NA NA NA NA NA NA NA NA NA

Enterprise Applications- Subscription-based Median: 26.1% 23.9% 21.1% 1.8% 2.0% 3.3% 9.4x 6.9x 5.7x 59.9x 57.1x 51.4x 45.6x 48.6x 42.5x 34.9x 32.5x 25.1x 2.7x 2.0x

Mean: 26.7% 22.7% 20.7% 6.6% 4.8% 6.1% 9.0x 6.8x 5.6x 59.4x 59.0x 56.3x 48.9x 54.4x 51.1x 37.9x 34.5x 29.2x 3.1x 2.5x

B = Buy, H = Hold, S = Sell, NC = Not Covered

# Followed by Stifel analyst Brad Reback

Source: Company data, FactSet, (*)Stifel estimates

Oper. Margin TEV / SalesRevenue Growth P/E P/FCF EV/EBITDA

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

Workiva Income Statement Tom Roderick

(in thousands, except EPS) STIFEL

(312) 564-8701

2012A 2013A 2014A 2015A 1Q16A 2Q16A 3Q16A 4Q16A 2016A 1Q17A 2Q17A 3Q17A 4Q17E 2017E 1Q18E 2Q18E 3Q18E 4Q18E 2018E

Dec-12 Dec-13 Dec-14 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Dec-18

Subscription and Support $34,702 $65,164 $91,317 $116,288 $33,585 $34,969 $36,237 $38,329 $143,120 $39,540 $40,980 $43,214 $45,000 $168,734 $46,000 $47,800 $50,000 $52,200 $196,000

Professional Services $18,236 $19,987 $21,377 $28,984 $10,966 $8,042 $8,473 $8,045 $35,526 $12,364 $8,411 $8,854 $8,400 $38,029 $13,000 $9,200 $9,000 $8,800 $40,000

Total Revenue $52,938 $85,151 $112,694 $145,272 $44,551 $43,011 $44,710 $46,374 $178,646 $51,904 $49,391 $52,068 $53,400 $206,763 $59,000 $57,000 $59,000 $61,000 $236,000

Cost of Subscription and Support $9,142 $14,929 $20,680 $22,196 $6,800 $6,914 $6,572 $7,116 $27,402 $7,497 $7,580 $8,268 $8,775 $32,120 $8,648 $8,986 $9,400 $9,814 $36,848

Cost of Prefessional Services $9,633 $9,349 $12,359 $17,296 $6,066 $5,445 $5,940 $5,868 $23,319 $6,481 $6,428 $7,051 $7,140 $27,100 $7,800 $6,992 $7,020 $6,600 $28,412

Total Cost of Revenue $18,775 $24,278 $33,039 $39,492 $12,866 $12,359 $12,512 $12,984 $50,721 $13,978 $14,008 $15,319 $15,915 $59,220 $16,448 $15,978 $16,420 $16,414 $65,260

Gross profit $34,163 $60,873 $79,655 $105,780 $31,685 $30,652 $32,198 $33,390 $127,925 $37,926 $35,383 $36,749 $37,485 $147,543 $42,552 $41,022 $42,580 $44,586 $170,740

Operating Expenses:

Research and development $18,248 $33,354 $42,388 $48,542 $13,932 $13,438 $13,748 $13,955 $55,073 $15,043 $15,767 $16,926 $17,088 $64,824 $17,582 $17,100 $17,110 $18,178 $69,970

Sales and marketing $27,213 $40,268 $52,257 $67,842 $19,633 $19,379 $21,787 $17,592 $78,391 $18,054 $19,093 $22,924 $22,362 $82,433 $21,830 $21,090 $24,780 $25,010 $92,710

General and administrative $8,728 $13,163 $16,235 $22,079 $6,842 $5,656 $5,728 $5,566 $23,792 $6,674 $5,990 $6,017 $6,835 $25,516 $6,785 $6,555 $6,903 $7,320 $27,563

Total Operating Expenses $54,189 $86,785 $110,880 $138,463 $40,407 $38,473 $41,263 $37,113 $157,256 $39,771 $40,850 $45,867 $46,285 $172,773 $46,197 $44,745 $48,793 $50,508 $190,243

Operating Profit ($20,026) ($25,912) ($31,225) ($32,683) ($8,722) ($7,821) ($9,065) ($3,723) ($29,331) ($1,845) ($5,467) ($9,118) ($8,800) ($25,230) ($3,645) ($3,723) ($6,213) ($5,922) ($19,503)

Interest expense ($1,521) ($366) ($2,044) ($2,025) ($490) ($468) ($462) ($455) ($1,875) ($455) ($475) ($464) ($464) ($1,858) ($400) ($400) ($400) ($400) ($1,600)

Other income (expense) ($861) $104 ($468) $2,302 $576 $278 $298 $348 $1,500 $612 $176 $198 $198 $1,184 $350 $350 $350 $350 $1,400

Pre-tax income ($22,408) ($26,174) ($33,737) ($32,406) ($8,636) ($8,011) ($9,229) ($3,830) ($29,706) ($1,688) ($5,766) ($9,384) ($9,066) ($25,904) ($3,695) ($3,773) ($6,263) ($5,972) ($19,703)

Income Taxes $0 $0 $32 ($7) $19 $12 ($8) $1 $24 $9 $33 $25 $45 $112 $26 $26 $44 $42 $138

Net income ($22,408) ($26,174) ($33,769) ($32,399) ($8,655) ($8,023) ($9,221) ($3,831) ($29,730) ($1,697) ($5,799) ($9,409) ($9,111) ($26,016) ($3,721) ($3,800) ($6,307) ($6,013) ($19,841)

EPS ($0.85) ($0.82) ($1.04) ($0.81) ($0.21) ($0.20) ($0.23) ($0.09) ($0.73) ($0.04) ($0.14) ($0.23) ($0.22) ($0.63) ($0.09) ($0.09) ($0.15) ($0.14) ($0.47)

Shares Outstanding, Basic 26,390 31,377 32,432 39,852 40,452 40,594 40,763 40,873 40,670 41,109 41,430 41,815 42,015 41,592 42,165 42,165 42,165 42,165 42,165

Shares Outstanding, Fully Diluted 26,390 31,377 34,314 39,852 40,452 40,594 40,763 40,873 40,670 41,109 41,430 41,815 42,015 41,592 42,165 42,165 42,165 42,165 42,165

EBITDA ($18,987) ($23,539) ($27,348) ($28,273) ($7,725) ($6,846) ($8,121) ($2,819) ($25,511) ($954) ($4,600) ($8,264) ($7,785) ($21,603) ($2,642) ($2,697) ($5,092) ($4,763) ($15,194)

Total Adjustments $8,129 $3,370 $7,385 $11,000 $3,390 $3,502 $3,670 $3,685 $14,247 $4,139 $4,397 $4,664 $6,764 $19,964 $4,409 $4,667 $4,934 $7,034 $21,044

GAAP Net Income ($30,537) ($29,544) ($41,154) ($43,399) ($12,045) ($11,525) ($12,891) ($7,516) ($43,977) ($5,836) ($10,196) ($14,073) ($15,875) ($45,980) ($8,130) ($8,467) ($11,241) ($13,047) ($40,885)

GAAP EPS ($1.14) ($0.94) ($1.27) ($1.10) ($0.30) ($0.28) ($0.32) ($0.18) ($1.08) ($0.14) ($0.25) ($0.34) ($0.38) ($1.11) ($0.19) ($0.20) ($0.27) ($0.31) ($0.97)

Total stock-based compensation $8,129 $3,370 $7,385 $11,000 $3,390 $3,502 $3,670 $3,685 $14,247 $4,139 $4,397 $4,664 $6,764 $19,964 $4,409 $4,667 $4,934 $7,034 $21,044

As % of Revenue

Subscription and Support Rev. Mix 65.6% 76.5% 81.0% 80.0% 75.4% 81.3% 81.0% 82.7% 80.1% 76.2% 83.0% 83.0% 84.3% 81.6% 78.0% 83.9% 84.7% 85.6% 83.1%

Professional Services Rev. Mix 34.4% 23.5% 19.0% 20.0% 24.6% 18.7% 19.0% 17.3% 19.9% 23.8% 17.0% 17.0% 15.7% 18.4% 22.0% 16.1% 15.3% 14.4% 16.9%

Gross margin - Subscription/Support 73.7% 77.1% 77.4% 80.9% 79.8% 80.2% 81.9% 81.4% 80.9% 81.0% 81.5% 80.9% 80.5% 81.0% 81.2% 81.2% 81.2% 81.2% 81.2%

Gross margin - Prof. Services 47.2% 53.2% 42.2% 40.3% 44.7% 32.3% 29.9% 27.1% 34.4% 47.6% 23.6% 20.4% 15.0% 28.7% 40.0% 24.0% 22.0% 25.0% 29.0%

Gross margin 64.5% 71.5% 70.7% 72.8% 71.1% 71.3% 72.0% 72.0% 71.6% 73.1% 71.6% 70.6% 70.2% 71.4% 72.1% 72.0% 72.2% 73.1% 72.3%

Research and development 34.5% 39.2% 37.6% 33.4% 31.3% 31.2% 30.7% 30.1% 30.8% 29.0% 31.9% 32.5% 32.0% 31.4% 29.8% 30.0% 29.0% 29.8% 29.6%

Sales and marketing 51.4% 47.3% 46.4% 46.7% 44.1% 45.1% 48.7% 37.9% 43.9% 34.8% 38.7% 44.0% 41.9% 39.9% 37.0% 37.0% 42.0% 41.0% 39.3%

General and administrative 16.5% 15.5% 14.4% 15.2% 15.4% 13.2% 12.8% 12.0% 13.3% 12.9% 12.1% 11.6% 12.8% 12.3% 11.5% 11.5% 11.7% 12.0% 11.7%

Operating margin -37.8% -30.4% -27.7% -22.5% -19.6% -18.2% -20.3% -8.0% -16.4% -3.6% -11.1% -17.5% -16.5% -12.2% -6.2% -6.5% -10.5% -9.7% -8.3%

EBT -42.3% -30.7% -29.9% -22.3% -19.4% -18.6% -20.6% -8.3% -16.6% -3.3% -11.7% -18.0% -17.0% -12.5% -6.3% -6.6% -10.6% -9.8% -8.3%

Tax Rate 0.0% 0.0% -0.1% 0.0% -0.2% -0.1% 0.1% 0.0% -0.1% -0.5% -0.6% -0.3% -0.5% -0.4% -0.7% -0.7% -0.7% -0.7% -0.7%

Net Margin -42.3% -30.7% -30.0% -22.3% -19.4% -18.7% -20.6% -8.3% -16.6% -3.3% -11.7% -18.1% -17.1% -12.6% -6.3% -6.7% -10.7% -9.9% -8.4%

Y/Y % Growth

Total Revenue 256.1% 60.9% 32.3% 28.9% 26.7% 26.6% 23.3% 16.3% 23.0% 16.5% 14.8% 16.5% 15.2% 15.7% 13.7% 15.4% 13.3% 14.2% 14.1%

Gross profit 278.0% 78.2% 30.9% 32.8% 23.5% 25.7% 20.7% 14.9% 20.9% 19.7% 15.4% 14.1% 12.3% 15.3% 12.2% 15.9% 15.9% 18.9% 15.7%

Source: Company reports, Stifel estimates

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

Workiva Consolidated Balance Sheet

($'s in '000's) 2012A 2013A 2014A 2015A 1Q16A 2Q16A 3Q16A 4Q16A 2016A 1Q17A 2Q17A 3Q17A 4Q17E 2017E 1Q18E 2Q18E 3Q18E 4Q18E 2018E

Current Assets

Cash and cash equivalents $24,979 $15,515 $101,131 $58,750 $43,226 $39,885 $42,842 $51,281 $51,281 $52,204 $59,986 $62,718 $58,758 $58,758 $59,161 $60,581 $61,864 $67,474 $67,474

Marketable securities $5,200 $2,436 $0 $17,420 $12,665 $11,044 $10,995 $11,435 $11,435 $12,498 $12,877 $15,033 $15,033 $15,033 $15,033 $15,033 $15,033 $15,033 $15,033

Accounts receivable $5,167 $13,885 $11,120 $15,647 $16,470 $18,260 $22,353 $22,535 $22,535 $19,580 $22,733 $24,283 $26,700 $26,700 $22,944 $30,066 $28,859 $31,930 $31,930

Deferred commissions $546 $301 $852 $1,368 $1,383 $1,500 $1,634 $1,864 $1,864 $1,867 $2,021 $2,208 $1,602 $1,602 $2,122 $1,710 $1,770 $1,220 $1,220

Other receivables $170 $2,856 $295 $818 $1,042 $897 $1,261 $1,545 $1,545 $705 $1,573 $1,109 $1,068 $1,068 $1,180 $570 $1,239 $915 $915

Prepaid expenses and other $1,285 $891 $3,143 $3,875 $4,063 $5,387 $4,972 $9,382 $9,382 $8,580 $11,416 $6,298 $2,136 $2,136 $5,900 $8,550 $5,900 $6,100 $6,100

Total Current Assets $37,347 $35,884 $116,541 $97,878 $78,849 $76,973 $84,057 $98,042 $98,042 $95,434 $110,606 $111,649 $105,297 $105,297 $106,341 $116,510 $114,665 $122,672 $122,672

Restricted cash $199 $179 $401 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Restricted marketable securities $0 $2,368 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Property and equipment $15,561 $34,715 $46,265 $44,410 $43,747 $43,619 $43,287 $42,590 $42,590 $41,949 $41,138 $41,300 $41,086 $41,086 $40,968 $40,797 $40,561 $40,317 $40,317

Intangible assets $0 $167 $549 $896 $936 $978 $995 $1,012 $1,012 $1,021 $1,056 $1,088 $1,143 $1,143 $1,198 $1,253 $1,308 $1,363 $1,363

Other assets $415 $631 $795 $711 $774 $1,126 $1,583 $1,499 $1,499 $1,418 $1,393 $1,553 $1,726 $1,726 $1,612 $1,608 $1,760 $1,972 $1,972

Total Assets $53,522 $73,944 $164,551 $143,895 $124,306 $122,696 $129,922 $143,143 $143,143 $139,822 $154,193 $155,590 $149,252 $149,252 $150,119 $160,168 $158,294 $166,324 $166,324

Current Liabilities

Accounts payable $2,396 $3,993 $3,011 $5,138 $4,156 $4,965 $5,637 $849 $849 $1,867 $1,191 $1,861 $1,602 $1,602 $1,770 $1,710 $1,770 $1,830 $1,830

Accrued expenses and other $6,703 $8,939 $16,765 $20,394 $14,578 $14,697 $17,177 $20,695 $20,695 $14,898 $17,286 $20,771 $10,680 $10,680 $11,800 $14,250 $14,750 $15,250 $15,250

Deferred revenue $17,120 $27,367 $42,605 $55,741 $53,101 $57,291 $63,629 $76,016 $76,016 $79,087 $91,914 $99,149 $90,780 $90,780 $94,400 $101,460 $109,150 $79,300 $79,300

Current portion of capital leases $0 $723 $1,941 $1,808 $1,732 $1,625 $1,432 $1,285 $1,285 $1,258 $904 $1,184 $1,184 $1,184 $1,184 $1,184 $1,184 $1,184 $1,184

Current portion of long-term debt $185 $2,303 $2,408 $1,003 $1,041 $1,023 $1,184 $1,042 $1,042 $852 $1,263 $813 $137 $137 $137 $137 $137 $137 $137

Total current liablities $26,404 $43,325 $66,730 $84,084 $74,608 $79,601 $89,059 $99,887 $99,887 $97,962 $112,558 $123,778 $104,383 $104,383 $109,291 $118,741 $126,991 $97,701 $97,701

Deferred revenue $1,045 $9,018 $13,671 $7,597 $7,138 $8,340 $15,216 $21,485 $21,485 $22,573 $24,342 $23,278 $45,119 $45,119 $45,146 $49,901 $46,556 $90,237 $90,237

Deferred rent $67 $335 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Capital lease and financing obligations $0 $12,511 $22,747 $21,083 $20,727 $20,358 $20,013 $19,743 $19,743 $19,473 $18,999 $18,709 $18,361 $18,361 $18,013 $17,665 $17,317 $16,969 $16,969

Long-term debt $5,055 $4,513 $3,515 $2,069 $1,781 $1,550 $1,142 $1,053 $1,053 $706 $437 $289 $289 $289 $289 $289 $289 $289 $289

Other liabilities $9,190 $7,636 $2,069 $3,343 $3,491 $4,026 $4,064 $4,100 $4,100 $4,092 $3,985 $4,008 $4,008 $4,008 $4,008 $4,008 $4,008 $4,008 $4,008

Total liabilities $41,761 $77,338 $108,732 $118,176 $107,745 $113,875 $129,494 $146,268 $146,268 $144,806 $160,321 $170,062 $172,160 $172,160 $176,747 $190,604 $195,161 $209,204 $209,204

Series A preferred units ($9,652) ($9,711) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Series B preferred units ($6,483) ($6,485) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Series C preferred units $26,954 $8,590 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Common stock ($2,664) $482 $39 $41 $41 $41 $41 $41 $41 $41 $42 $42 $42 $42 $42 $42 $42 $42 $42

Appreciation and participaiton units $3,648 $3,872 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Accumulated other comprehensive loss ($42) ($142) $147 $241 $215 $262 $250 $291 $291 $259 $205 $116 $116 $116 $116 $116 $116 $116 $116

Retained Earnings $0 $0 ($133,535) ($176,934) ($188,979) ($200,504) ($213,395) ($220,911) ($220,911) ($226,747) ($236,943) ($251,016) ($15,833) ($15,833) ($8,088) ($8,425) ($11,199) ($13,005) ($13,005)

Additional Paid in Capital $0 $0 $189,168 $202,371 $205,284 $209,022 $213,532 $217,454 $217,454 $221,463 $230,568 $236,386 ($7,232) ($7,232) ($18,698) ($22,169) ($25,826) ($30,033) ($30,033)

Total shareholders equity $11,761 ($3,394) $55,819 $25,719 $16,561 $8,821 $428 ($3,125) ($3,125) ($4,984) ($6,128) ($14,472) ($22,907) ($22,907) ($26,628) ($30,436) ($36,867) ($42,880) ($42,880)

Total liabilities and shareholders equity $53,522 $73,944 $164,551 $143,895 $124,306 $122,696 $129,922 $143,143 $143,143 $139,822 $154,193 $155,590 $149,252 $149,252 $150,119 $160,168 $158,294 $166,324 $166,324

Calculated Billings Analysis 2012A 2013A 2014A 2015A 1Q16A 2Q16A 3Q16A 4Q16A 2016A 1Q17A 2Q17A 3Q17A 4Q17E 2017E 1Q18E 2Q18E 3Q18E 4Q18E 2018E

Deferred revenue $18,165 $36,385 $56,276 $63,338 $60,239 $65,631 $78,845 $97,501 $97,501 $101,660 $116,256 $122,427 $135,899 $135,899 $139,546 $151,361 $155,706 $169,537 $169,537

y/y % growth 100.3% 54.7% 12.5% 8.5% 13.1% 32.2% 53.9% 53.9% 68.8% 77.1% 55.3% 39.4% 39.4% 37.3% 30.2% 27.2% 24.8% 24.8%

q/q % growth -4.9% 9.0% 20.1% 23.7% 4.3% 14.4% 5.3% 11.0% 2.7% 8.5% 2.9% 8.9%

Calculated billings $61,675 $103,371 $132,585 $152,334 $41,452 $48,403 $57,924 $65,030 $212,809 $56,063 $63,987 $58,239 $66,872 $245,161 $62,648 $68,815 $63,345 $74,831 $269,639

y/y % growth 67.6% 28.3% 14.9% 20.5% 32.6% 53.0% 49.2% 39.7% 35.2% 32.2% 0.5% 2.8% 15.2% 11.7% 7.5% 8.8% 11.9% 10.0%

q/q % growth -4.9% 16.8% 19.7% 12.3% -13.8% 14.1% -9.0% 14.8% -6.3% 9.8% -7.9% 18.1%

Source: Company reports, Stifel estimates

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

Workiva Cash Flow Statement

($'s in '000's) 2012A 2013A 2014A 2015A 1Q16A 2Q16A 3Q16A 4Q16A 2016A 1Q17A 2Q17A 3Q17A 4Q17E 2017E 1Q18E 2Q18E 3Q18E 4Q18E 2018E

Cash flows from operating activities:

Net loss ($30,437) ($29,544) ($41,154) ($43,399) ($12,045) ($11,525) ($12,891) ($7,516) ($43,977) ($5,836) ($10,196) ($14,073) ($15,875) ($45,980) ($8,130) ($8,467) ($11,241) ($13,047) ($40,885)

Adjustements to reconcile net loss to net cash used

in operating activities

Depreciation and amortization $1,039 $2,373 $3,877 $4,410 $997 $975 $944 $904 $3,820 $891 $867 $854 $1,015 $3,627 $1,003 $1,026 $1,121 $1,159 $4,309

Equity-based compensation expense $8,129 $3,370 $7,385 $11,000 $3,390 $3,502 $3,670 $3,685 $14,247 $4,139 $4,397 $4,664 $6,764 $19,964 $4,409 $4,667 $4,934 $7,034 $21,044

Provision for doubtful accounts $183 ($83) $123 $449 $122 $48 ($92) $107 $185 $286 $146 ($691) $0 ($259) $0 $0 $0 $0 $0

Accretion of discount on debt $550 $0 $266 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Change in fair value of derivative liability ($3,271) $0 $193 ($76) $0 ($12) $0 $0 ($12) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Loss on settlement of convertible notes $4,206 $0 $245 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Recognition of forgivable loan $0 $0 ($99) ($2,383) ($433) ($230) ($247) ($231) ($1,141) ($538) ($198) ($207) $0 ($943) $0 $0 $0 $0 $0

Realized loss on available-for-sales sec. $0 $0 $136 ($13) ($2) ($4) $5 ($25) ($26) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Amortization of deferred gov grant obligation $0 $0 $0 $77 $39 $36 $36 $36 $147 $31 $28 $24 $0 $83 $0 $0 $0 $0 $0

Changes in assets and liabilities:

Accounts receivable $1,014 ($8,647) $2,602 ($5,080) ($881) ($1,844) ($4,009) ($367) ($7,101) $2,686 ($3,228) ($757) ($2,417) ($3,716) $3,756 ($7,121) $1,207 ($3,071) ($5,230)

Deferred commissions ($43) $244 ($553) ($520) ($12) ($117) ($135) ($233) ($497) ($2) ($149) ($179) $606 $276 ($520) $412 ($60) $550 $382

Other receivables $176 ($686) $155 ($523) ($224) $142 ($365) ($285) ($732) $840 ($865) $468 $41 $484 ($112) $610 ($669) $324 $153

Prepaid expenses and other ($1,017) $394 ($2,251) ($734) ($186) ($1,327) $415 ($4,415) ($5,513) $804 ($2,830) $5,123 $4,162 $7,259 ($3,764) ($2,650) $2,650 ($200) ($3,964)

Other assets ($333) ($216) ($52) $81 ($63) ($323) ($455) $187 ($654) ($23) $36 ($87) ($173) ($247) $114 $4 ($152) ($212) ($246)

Accounts payable $827 $1,598 ($1,530) $2,331 ($696) $797 $279 ($4,310) ($3,930) $1,017 ($678) $669 ($259) $749 $168 ($60) $60 $60 $228

Deferred revenue $8,737 $18,237 $19,961 $7,297 ($3,215) $5,399 $13,228 $18,799 $34,211 $4,096 $14,398 $5,904 $13,472 $37,870 $3,648 $11,815 $4,345 $13,831 $33,639

Accrued expenses and other current liab. $4,988 $2,508 $7,137 $5,390 ($5,869) $447 $2,410 $3,616 $604 ($5,811) $2,254 $3,474 ($10,091) ($10,174) $1,120 $2,450 $500 $500 $4,570

Change in restricted cash ($154) $0 $54 $101 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net cash used in operating activities ($5,406) ($10,452) ($3,505) ($21,592) ($19,078) ($4,036) $2,793 $9,952 ($10,369) $2,580 $3,982 $5,186 ($2,756) $8,992 $1,691 $2,686 $2,695 $6,927 $14,000

Cash flows from investing activities:

Purchase of property and equipment ($5,685) ($9,503) ($8,566) ($1,843) ($412) ($597) ($91) ($801) ($1,901) ($121) ($26) ($987) ($801) ($1,935) ($885) ($855) ($885) ($915) ($3,540)

Purchase of marketable securities ($5,240) ($920) $0 ($24,069) $0 ($802) $0 ($499) ($1,301) ($4,091) ($2,259) ($5,017) $0 ($11,367) $0 $0 $0 $0 $0

Sale of marketable securities $0 $1,160 $4,864 $6,521 $4,793 $2,404 $0 $0 $7,197 $3,001 $1,850 $2,830 $0 $7,681 $0 $0 $0 $0 $0

Purchase of intangible assets $0 ($169) ($394) ($386) ($55) ($59) ($38) ($38) ($190) ($31) ($58) ($55) ($55) ($199) ($55) ($55) ($55) ($55) ($220)

Change in restricted cash $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net cash used in investing activities ($10,925) ($9,432) ($4,096) ($19,777) $4,326 $946 ($129) ($1,338) $3,805 ($1,242) ($493) ($3,229) ($856) ($5,820) ($940) ($910) ($940) ($970) ($3,760)

Cash flows from financing activities:

Proceeds from issuance preferred units $30,234 $7,165 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Payments of equity issuance costs ($315) ($20) $0 ($1,346) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Proceeds from issuance of convertible notes $2,455 $0 $5,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Repayment of convertible debt ($25) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Proceeds from option exercises $71 $256 $580 $2,244 $284 $236 $840 $237 $1,597 $806 $4,709 $1,154 $0 $6,669 $0 $0 $0 $0 $0

Proceeds from public equity offering $0 $0 $91,769 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Repayment of debt to related party ($1,000) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Changes in restricted cash $20 $20 ($275) $300 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Repayment of long-term debt ($158) ($181) ($2,365) ($185) $0 ($18) $0 $0 ($18) $0 ($20) ($53) $0 ($73) $0 ($20) ($53) $0 ($73)

Principal payments on capital lease $0 ($346) ($1,338) ($2,282) ($432) ($476) ($538) ($417) ($1,863) ($297) ($490) ($348) ($348) ($1,483) ($348) ($348) ($348) ($348) ($1,392)

Distributions to members $0 ($61) ($279) ($381) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Taxes related to net share settlements of sbc awards $0 $0 $0 $0 ($761) $0 $0 $0 ($761) ($936) $0 $0 $0 ($936) $0 $0 $0 $0 $0

Proceeds from borrowing on line of credit $0 $2,017 $3,020 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Repayment of line of credit $0 $0 ($5,151) $0 $0 ($33) $0 $0 ($33) $0 ($10) ($71) $0 ($81) $0 ($10) ($71) $0 ($81)

Government loan award $0 $1,520 $2,194 $548 $183 $0 $0 $0 $183 $0 $22 $0 $0 $22 $0 $22 $0 $0 $22

Net cash provided by financing activities $31,282 $10,370 $93,155 ($1,102) ($726) ($291) $302 ($180) ($895) ($427) $4,211 $682 ($348) $4,118 ($348) ($356) ($472) ($348) ($1,524)

Effect of foreign exchange rates on cash ($1) $50 $62 $90 ($46) $40 ($9) $5 ($10) $12 $82 $93 $187 $0

Net increase in cash and cash equivalents $14,950 ($9,464) $85,616 ($42,381) ($15,524) ($3,341) $2,957 $8,439 ($7,469) $923 $7,782 $2,732 ($3,960) $7,477 $403 $1,420 $1,283 $5,609 $8,716

Cash and cash equivalents at beginning of year $10,029 $24,979 $15,515 $101,131 $58,750 $43,226 $39,885 $42,842 $58,750 $51,281 $52,204 $59,986 $62,718 $51,281 $58,758 $59,161 $60,581 $61,864 $58,758

Cash and cash equivalents at end of year $24,979 $15,515 $101,131 $58,750 $43,226 $39,885 $42,842 $51,281 $51,281 $52,204 $59,986 $62,718 $58,758 $58,758 $59,161 $60,581 $61,864 $67,474 $67,474

Free Cash Flow Analysis

Cash flow from operations ($5,406) ($10,452) ($3,505) ($21,592) ($19,078) ($4,036) $2,793 $9,952 ($10,369) $2,580 $3,982 $5,186 ($2,756) $8,992 $1,691 $2,686 $2,695 $6,927 $14,000

Capital Expenditures ($5,685) ($9,503) ($8,566) ($1,843) ($412) ($597) ($91) ($801) ($1,901) ($121) ($26) ($987) ($801) ($1,935) ($885) ($855) ($885) ($915) ($3,540)

Free Cash Flow ($11,091) ($19,955) ($12,071) ($23,435) ($19,490) ($4,633) $2,702 $9,151 ($12,270) $2,459 $3,956 $4,199 ($3,557) $7,057 $806 $1,831 $1,810 $6,012 $10,460

FCF / share ($0.42) ($0.64) ($0.35) ($0.59) ($0.48) ($0.11) $0.07 $0.22 ($0.30) $0.06 $0.10 $0.10 ($0.08) $0.17 $0.02 $0.04 $0.04 $0.14 $0.25

FCF Margin (21.0%) (23.4%) (10.7%) (16.1%) (43.7%) (10.8%) 6.0% 19.7% (6.9%) 4.7% 8.0% 8.1% (6.7%) 3.4% 1.4% 3.2% 3.1% 9.9% 4.4%

Source: Company reports, Stifel estimates

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

Important Disclosures and Certifications

I, Tom M. Roderick, certify that the views expressed in this research report accurately reflect my personal views about the subject securities or issuers; and I, Tom M. Roderick, certify that no part of my compensation was, is, or will be directly or indirectly related to the specific recommendations or views contained in this research report. Our European Policy for Managing Research Conflicts of Interest is available at www.stifel.com.

Workiva Inc. (WK) as of November 07, 2017 (in USD)

P ric

e (U

S D

)

10 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18

01/06/2015 13.98 I:B:$20.00

09/08/2016 18.56 B:$22.00

11/10/2016 14.75 B:$18.00

05/05/2017 17.95 B:$20.00

08/03/2017 19.10 B:$21.00

08/17/2017 19.55 B:$23.00

Powered by: BlueMatrix Buy=B; Hold=H; Sell=S; Discontinued=D; Suspended=SU; Discontinued=D; Initiation=I *Represents the value(s) that changed.

For a price chart with our ratings and target price changes for WK go to http://stifel2.bluematrix.com/sellside/Disclosures.action?ticker=WK

The rating and target price history for Workiva Inc. and its securities prior to February 25, 2015, on the above price chart reflects the research analyst's views under a different rating system than currently utilized at Stifel. For a description of the investment rating system previously utilized go to.www.stifel.com.

Stifel or an affiliate expects to receive or intends to seek compensation for investment banking services from Workiva Inc. in the next 3 months.

Stifel or an affiliate is a market maker or liquidity provider in the securities of Workiva Inc.. The equity research analyst(s) responsible for the preparation of this report receive(s) compensation based on various factors, including Stifel’s overall revenue, which includes investment banking revenue. Our investment rating system is three tiered, defined as follows:

BUY -We expect a total return of greater than 10% over the next 12 months with total return equal to the percentage price change plus dividend yield.

HOLD -We expect a total return between -5% and 10% over the next 12 months with total return equal to the percentage price change plus dividend yield.

SELL -We expect a total return below -5% over the next 12 months with total return equal to the percentage price change plus dividend yield.

Occasionally, we use the ancillary rating of SUSPENDED (SU) to indicate a long-term suspension in rating and/or target price, and/or coverage due to applicable regulations or Stifel policies. SUSPENDED indicates the analyst is unable to determine a “reasonable basis” for rating/target price or estimates due to lack of publicly available information or the inability to quantify the publicly available information provided by the company and it is unknown when the outlook will be clarified. SUSPENDED may also be used when an analyst has left the firm.

Of the securities we rate, 49% are rated Buy, 38% are rated Hold, 2% are rated Sell and 11% are rated Suspended.

Within the last 12 months, Stifel or an affiliate has provided investment banking services for 20%, 8%, 0% and 10% of the companies whose shares are rated Buy, Hold, Sell and Suspended, respectively.

Additional Disclosures

Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

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Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017

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Workiva Inc. WK – NYSE

Software: Applications Analysis of Sales/Earnings

November 8, 2017