Quietly replacing the old way: customers are switching to the company from an entrenched alternative, and the switching
The model's full reasoning — Q4 2015 call → NOWe need to determine if management describes customers switching from an entrenched alternative to their product, and that this switching is still in early stages with most potential switchers not yet converted. Key evidence: Jack Sanders discusses i6 innovation process, new products like TruVue (clear container) and EvoCan. He says "we've had numerous wins just to get to a point where you can successfully produce plastic based container" and "we're getting much more interest in the container as I said earlier coming out of the announcement in New York we have three to four new companies contact us and are engaging with us right now about the container." Also mentions "we already won some new business promise" and "we're looking for that hit, like we talked about in New York on the ClearView container, that is really -- on the TruVue container that's ramping up, we're still shooting for end of first quarter, early second quarter release." He says "The growth you see in flexibles is really an output of i6." Also "we've had numerous wins just to get to a point where you can successfully produce plastic based container" - but that's about production capability. The question: Are customers switching from an entrenched alternative? For TruVue, it's replacing metal cans with clear plastic containers. He says "They had a metal can. Now they're looking at -- in this see-through container" and "their reaction has been highly positive." Also "since that meeting in the New York, we've had three or four new contact from potential customers that currently use metal cans, canned foods about the container." So there is a substitution from metal cans to clear plastic. Is it early stages? He says "we're still shooting for end of first quarter, early second quarter release" - so product not yet launched. He says "we've had numerous wins just to get to a point where you can successfully produce plastic based container" - that's about production. He says "we already won some new business promise" - but not clear if that's for TruVue. He says "we're getting much more interest" - so it's early. Also "we're looking for that hit" - meaning they haven't got a big win yet. So the switching is anticipated but not yet happening at scale. The product is not yet on shelf. So it's not "actually happening now" in terms of customers already switched.
| Ticker | Company | Call | Date | Call grade |
|---|---|---|---|---|
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| SIBN | SI-BONE, Inc. | Q3 2022 | 2022-11-07 | C+ |
| TMCI | Treace Medical Concepts, Inc. | Q2 2022 | 2022-08-13 | B+ |
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BLKB · Q1 2017 → YESThe question is: Does management describe that customers are currently SWITCHING TO THE COMPANY FROM AN ENTRENCHED ALTERNATIVE THEY PREVIOUSLY RELIED ON, and that this switching is still in its early ...YES Management describes customers switching from entrenched alternatives (legacy hardware systems, older Raiser's Edge versions, standalone point solutions) to Blackbaud's cloud solutions like NXT, with examples of recent replacements and migrations already occurring. They also note that much of the potential remains, as the installed base of legacy methods is still large 25% of subscription revenue, and they describe the opportunity as "really early days" with substantial distance left to run. This fits the criteria of a present-tense substitution pattern in the market, not just future hope. The high retention on their own base (93%) combined with declining maintenance revenue shows the shift is active and ongoing, while new wins against competitors and legacy alternatives are happening now. The TAM of $7 billion with hundreds of thousands of addressable customers reinforces that switching is early-stage relative to the total opportunity. The answer is YES. The question is answered with YES. The question is answered with YES.
BLZE · Q3 2022 → YESThe question is: Does management describe that customers are currently SWITCHING TO THE COMPANY FROM AN ENTRENCHED ALTERNATIVE THEY PREVIOUSLY RELIED ON, and that this switching is still in its early ...YES The transcript shows management describing current customer switches from entrenched alternatives (AWS for urlscan.io; Synology NAS/on-prem for Fiture; broader AWS and on-prem users), with these as real, ongoing patterns. They explicitly note that much of the potential remains ("so much of the world's data is still on-premises" and "customers that are inside of AWS and others"), confirming the substitution is early-stage relative to the large installed base. This is conveyed directly in Gleb's responses as a present-tense reality, not merely anticipated. The two examples plus the broader opportunity framing establish a coherent substitution underway, with the company being substituted in. The investor question on percentages and Gleb's reply reinforce the pattern without contradicting the current movement. No single-event or future-only framing applies here. Thus, both conditions are met.
APPS · Q1 2024 → YESThe question is: Does management describe that customers are currently SWITCHING TO THE COMPANY FROM AN ENTRENCHED ALTERNATIVE THEY PREVIOUSLY RELIED ON, and that this switching is still in its early ...YES The transcript shows management describing customers shifting from Apple/Google app stores to DT Hub and SingleTap-enabled alternative distribution as an ongoing, early-stage substitution. Bill Stone notes the company has already launched DT Hub with four U.S. operators and is generating revenue today, while highlighting "increasing pressure on the duopoly" and 5 monetization ways for SingleTap that enable publishers to direct-download apps outside traditional stores. He explicitly calls it "very early days and not yet material to our overall results" and "early innings," confirming the installed base of the old way remains large and the switch is just beginning with incremental RPD gains from devices engaging the new platform. This meets the criteria of a present-tense substitution underway, with the company positioned as the alternative being adopted.