Model N Announces Record Revenue and Profitability for the Fiscal Year 2008


Revenue Management Growth Driven by Companies Seeking Proven Solutions to Improve Margin and Reduce Risk in an Economic Downturn

REDWOOD SHORES, California – October 30, 2008 –  Model N, the leader in Revenue Management, announced today that it has posted record financial results for the fiscal year 2008 ended September 30, including GAAP revenue exceeding $50M, gross margins of nearly 60%, and profitability in all four quarters.
 
“Our record financial performance is telling proof that our vision of Revenue Management is becoming top of mind for leading companies. Strong adoption is validating our strategy to deliver Revenue Management solutions that are industry specific, and our continued investment in deep domain expertise and tight collaboration with our customers, partners, and industry experts is resulting in a very clearly differentiated and superior offering in the market, ” said Zack Rinat, Founder and CEO of Model N. “This year has also highlighted the sound financial discipline with which we are scaling our company, and a solid record of execution to our objectives in product development, geographic expansion, and customer services that will continue to ensure we meet and exceed our customer’s needs.”

News Facts

  • Model N reported GAAP revenue of more than $50M, exceeding the plan for FY 2008 and representing the fifth straight year of record revenue growth
  • The company grew gross margins in  FY 2008 to nearly 60%
  • The company was profitable in all four quarters
  • The emergence of demand for Revenue Management solutions in other geographies has resulted in 25% of Model N’s FY 2008  license bookings coming from customers in Europe
  • The Model N full suite for Revenue Management continues to gain broad adoption with customers in both Life Sciences and High Tech, including a Top-Five worldwide semiconductor company.  With a record number of customer go-lives in FY 2008, Model N has more customers live on an integrated Revenue Management platform than any of its competitors.
  • Model N continues to invest in its market-leading products and strong collaboration with customers in both verticals, and has expanded its competitive advantage with the following:

    * June 2008 Life Sciences Release 5.3, which adds Fee for Service (FSS); a powerful new analytics applications for Revenue Planning and Intelligence (RPI); and Model N’s entry into the generics market with a complete Revenue Management suite of commercial applications purpose-built for generic pharmaceutical companies

    * June 2008 High Tech Release 7.6, which delivers improved visibility into opportunities; tighter controls on pricing and margins; and enhanced Point of Sale (POS) functionality that gives users a complete view of channel inventory, increases credit claim processing effectiveness,  and reduces channel incentive overpayments
  • In FY 2008 Model N added two new members to its world-class board of directors:  Mark Garrett, CFO Adobe Systems, and T. Michael Nevens, former senior partner in McKinsey’s global technology practice
  • Rainmaker 2008, a sold-out industry event held in February in Scottsdale, Arizona, featured a keynote address by Bruce Richardson, Chief Research Officer at AMR Research. Astellas Pharma US, Boston Scientific, Gilead Sciences, IDT, and Atmel were honored with Rainmaker awards for exemplary leadership in their Revenue Management initiatives. Model N partners Accenture, IMS Health, CSC, HighPoint Solutions, Sierra Atlantic, and Akamai Technologies demonstrated their support for Model N by sponsoring Rainmaker 2008. Scheduled for February 25 to 27 in Las Vegas, Rainmaker 2009 will focus on helping industry leaders maximize the value of Revenue Management in today’s uncertain economy.
  • AMR Research, Yankee Group, and Forrester Research published reports validating the growing need for vertical-specific Revenue Management solutions as well as customer case studies documenting the high ROI delivered by Model N

Revenue Management

  • Model N is the leader in Revenue Management — an emerging enterprise application category that enables companies to align and improve the processes of pricing and quoting, contract development and management, and trade settlements and channel incentives in order to eliminate the revenue leakage and reduce the financial regulatory compliance risk that can cost companies millions per year
  • Revenue Management has become a core, strategic focus for companies from all industries that deal with competitive pricing, complex contracts, and multiple channels. Model N offers a unique approach, optimized for life science and high tech companies, which combines industry-specific solutions and best practices expertise to enable our customers to better plan and control the processes that drive the entire revenue life cycle for their business.

Supporting Quotes

  •  “Designed specifically for semiconductor companies, Model N’s solution gives us greater visibility into design registrations, reduces quote turnaround times, and improves the ease of doing business with distribution partners,” said Bob Rudy, Vice President and CIO at Avago Technologies. “Conducting any amount of business through channel partners also requires us to enforce tighter auditable controls over POS and debit reconciliation as they directly impact financial reporting. Integrating our ERP platform with Model N’s Revenue Management Suite greatly facilitates this process for us.”
  • According to Hussain Mooraj and Wayne McDonnell of AMR Research, “One executive from a Top-Five pharmaceutical company said, ‘There is probably more money to be saved in six months by paying attention to our contract and rebate process than what can be saved in two years from focusing on cutting costs in our supply chain’”
  • “Model N has worked closely with generic pharmaceutical manufacturers to incorporate functionality into its application suite that directly addresses the unique Revenue Management needs of our industry,” said Joseph Greer, Senior Director of IT at leading U.S. generics and specialty pharmaceuticals company Par Pharmaceutical. “The complexity and speed at which the generics pharmaceutical business operates continues to increase, and our ability to incorporate the latest technology to streamline our business is a key to our success. As a lighthouse customer, we were pleased to play an important role in the development of the suite and look forward to continue working with Model N in the future.”
  • “As a premier integrated circuit manufacturer for the most respected brands in audio and industrial markets, Cirrus Logic selected Model N because it delivers a superior platform for quoting, pricing, and channel management processes,” said Tim Turk, Vice President of Worldwide Sales, Cirrus Logic. “With Model N’s closed-loop technology, we will be able to efficiently track opportunities, improve the quoting process, and effectively manage commissions, resulting in outstanding service for our customers.”
  • "We see Model N’s Revenue Management solutions as being one of our key strategic levers to continued growth, flexibility, and competitiveness in the global marketplace,” said Liam Butterworth, Vice President of Strategic Marketing, FCI Motorized Vehicles Division
  • “The story sells itself,” says Bruce Richardson.  “In a good economy revenue management is necessary.  In uncertain times, it’s a must-have.  If revenue management can add tens or hundreds of millions of dollars to your bottom line, why wouldn’t you do it?”

Supporting Resources

Release 5.3
World-class Board of Directors
Leading Pharma Company Selects Full Model N Suite for Revenue Management
Par Pharmaceutical Selects Full Model N Suite
FCI Extends Its Suite of Model N Applications
Rainmaker 2008
AMR Research Report on Using Revenue & Contract Management as a Strategic Weapon
AMR Research Report on Avago
Bruce Richardson in Scottsdale with Model N
Yankee Group Research Report


About Model N

Model N is a leader in Revenue Management solutions, offering an integrated suite of applications for analytics, pricing, contracts, compliance, and settlements optimized for the industry practices of Life Sciences and High Tech companies. For more information about Model N, please visit our website at www.modeln.com.


Media Contact:
Sean Cassidy
Model N, Inc.
Tel: 650-610-4820
scassidy@modeln.com


Model N is a registered trademark of Model N, Inc. All other company names mentioned are the property of their respective owners and are mentioned for identification purposes only.

 
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