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Alteryx Idea Proposal (AYX)

Alteryx Idea Proposal (AYX)
 

Is Alteryx becoming robust enough to defend itself against Tableau once its Prep product becomes a more viable threat?

Report Available: April 4, 2019

 

Blueshift’s initial research found AYX benefiting from increasing global demand for analytics. AYX offers self-serve data analytics software for teams that work heavily with data but are not data scientists, appealing to everyday marketing, accounting, and sales departments as it merges datasets from different databases with its no-code style that does not require a programmer. The company’s land and expand strategy where it offers a 14-day free trial and then converts prospects to paying customers is producing impressive results: Revenue for 2018 grew 55% year to year, international sales were up 96%, and gross margin reached 90%. But a large threat looms as partner DATA has created a competing product called Tableau Prep that has been deemed too lightweight to this point, though it could become a major player if DATA fixes some of its flaws.

 

Observations

  1. AYX experienced a record setting Q4 with quarterly sales up 57%, billings up 65%, and international revenue up 92% compared to the same period last year. With a strong Q4 and increasing demand for self-serve analytics, AYX’s 2019 guidance of 38%revenue growth is either conservative or a sign that competitive pressures could slow the company’s expansion.
  2. AYX landed 381 new customers in Q4, including CTL, CRARF, CL, HPE, and PFE, bringing its total to 4,696 and reflecting a 38% year-to-year increase. AYX now counts 26% of the Global 2000 as customers. The expand part of AYX’s strategy produced impressive results as well, doubling its number of customers with more than $1 million in annual recurring revenue and tripling the number of transactions greater than $500,000 in annual contract value. TEAM, DBX, MSFT, ORCL, SNAP and ADBE all increased their spending with AYX in Q4.
  3. AYX has become a hit with management consultants like BCG, McKinsey, and Bain. It allows anyone who performs complex data analysis to use it without having to learn how to code. Its drag and drop feature significantly increases working speed. It is known to be intuitive and simple with a visual workflow that makes complex tasks easy to understand and troubleshoot. It appeals to consultants because it can handle myriad types of data, including sas, csv, txt, salesforce and more. As its popularity has grown in the consulting world, it has also taken off with consultants’ clients whose employees are asking for it because of its effectiveness and simplicity.
  4. AYX does come with a hefty price tag of more than $5,000 annually for each personal license (less with a three-year subscription). And it faces increasing competition in the self-serve data analytics market including legacy statistical players like SAS and IBM’s SPSS and a growing list of new entrants including Paxata, Trifacta, DataRobot, and KNIME AG.
  5. About a year ago, DATA launched a data preparation platform called Tableau Prep, a self-service tool to quickly prep the data without scripting or coding so more time can be spent analyzing it. It is priced well below AYX at less than $1,000 a year for a suite of products that includes Prep. Its aim is to bring data to every person in every company, offering a product with the same appeal and purpose of AYX. With its 70,000+ customers, DATA has a built-in user base and would appear to pose the largest threat to its long-time partner AYX.
  6. However, Prep has a ways to go to achieve the same quality and effectiveness of AYX. One review of the two showed Prep as a more basic alternative to AYX with Prep’s tools more limited than AYX. The review said Prep fell short on complex data preparation, Macros, and APIs, while AYX has better spatial tools. A pro for Prep is that it allows for direct interaction with the dataset, which AYX does not. A community forum also revealed advantages of AYX and Prep’s shortcomings as contributors said Prep is more for light touch data prep to be used only in Tableau while AYX is for harder projects and deeper analysis. One commenter said there is nothing Prep can do that AYX cannot, and nothing that Prep does better or easier than AYX.

 

What is the growth potential for AYX? How deeply can AYX penetrate the TAM for data analytics? What traditional competitor is AYX displacing? How does the quality of AYX stack up to the competition? How much of a threat can Tableau Prep become? How soon will Prep be a more viable threat? Can AYX continue to improve its product offering to fend off competition? How sticky is AYX? Will the expansion of the AYX sales team be successful? Does AYX have any pricing power?  To answer these and other questions, Blueshift will gather data and issue a market research report from independent sources in the following areas: AYX Customers, Data Scientists, AYX Partners, Competitors, and Industry Specialists.

 

Companies: Alteryx Inc. (AYX), IBM Corp. (IBM), Microsoft Corp. (MSFT), Tableau Software Inc. (DATA)

 

Research Begins: March 18, 2019

 

Blueshift Research’s sister company, Intro-act, is launching its Intro-act Scorecard, the C-suite’s standard, ongoing measure of corporate investor engagement.

 

The Scorecard optimizes the ROI on corporate access by measuring: Concentration, Directionality, Breadth, Impact, Depth, and Duration