Town Hall Q&A follow up –Vol 1

March 24, 2023

Video Transcript

Speaker: Robert LoCascio, CEO

What are the areas of focus to retain talent and build up morale?

Mel Longdon: talent and build morale? A really good question. And as we really continue to drive the culture of belonging and connection, we've really been focusing heavily on development. We've invested in a suite of new tools that will really encourage you all to develop your skills and help advance your career. Something we've really been working on hard in 2022. So over the coming weeks, you'll all get to know about better work. Some of you have heard about it already. Some of you haven't but better works is our new O er tool that's really gonna help align the entire company around our top level priorities. And using the O C R tool will also be able to help drive cross functional collaboration, transparency, goal setting and the ability for everyone to see where we are tracking to date. And that goes right away right away from Rob's goals to the individual contributors. That's gonna be good because you'll really be able to have regular conversations, take place with your managers, check ins coaching and, and a lot more the next tool we invested is in ferry. That's that will we be launching in Q two, which is really very role specific success profiles. And we'll be introducing comp competency based assessments. So that's gonna, that's taking place as we speak. The leaders are working with some of the teams to ensure that we have all the success pro profiles loaded And all of you know, of course, which is our, our life person Institute. Great news here is we'll be uploading about 25,000 courses from open sesame. Um Some of those will include customized curricula for be from be used and uh mindsets. And as you heard, Alex and some of the other leaders mention is they'll also be working on individual um assignments and courses and programs to really help boost your knowledge of our product suite. And then in May will be launching merge uh live person internet where you'll be able to find, share, learn and communicate globally. So lots going on as you can hear and I really can't wait to roll all of these great initiatives out.

How do we know who was impacted by the RIF? When will org charts be updated?

Mel Longdon: And when will all charts be updated? A great question and very timely as my team and the leaders have been working through this week to ensure that we're updating both pro and LP sync. So by the beginning of next week, you should all be under your right managers and in the right teams, another question that came up was, well, what about my new title? Great question as well. And as we go through the changes, we will also be updating your new titles, which your managers will be communicating. So, um, so that's the first question answered and up to the next one.

With new offices in Bularia and Poland, how can these new outposts best absorb LivePerson culture and understanding of the company?

Mel Longdon: understanding of the company no matter where you are in the world, all of our new offices will benefit from the 27 years of experience. Life person has built, leveraging all of the teams from branding, marketing, the way we recruit the way we retain on board and develop our employees. And of course, all of the great tools we have, we really have everything to ensure you'll be successful. Marlene sins, our global facilities manager and myself and other leaders will be traveling to all of our new offices in April and may to ensure that we're there, to answer all of your questions and to talk to the new teams. So look out for that calendar invite um and be seeing you all soon.

Considering the new org, have we assessed what that means to our DEI impact?

Catherine Goetz: Um So that's a big question, but the short answer is yes. Now, while the contributions that we each make to a live person are much deeper, right? Than what we can measure from a quantitative perspective. Um There are two things that we pay very close attention to. So the first is around changes to workforce representation and what that means is basically, we wanna look at diversity of the organization and track how it trends over time to make sure that we're moving in a positive direction. Um We measure gender globally and we measure race and ethnicity in the US. And so as a result of this reorganization, we found that representation moved proportionally, right? So no big sweeping percentage point changes in terms of representation based on the total workforce. Now, the second thing that's really important is focused on equity of outcomes. And basically what that just means is that it's important that while um identity based characteristics are not part of the really difficult decisions around org redesign. We are accountable for the outcomes of that. And so it's important that we are measuring to understand whether or not there's any overly negative impacts on a particular group as compared to everybody else. So as part of the statistical analysis that we run, um we found in this case that there was a pretty neutral impact when you're looking at um differences for people who identify as underrepresented as compared to folks who don't. So if you have more questions about that, I'm happy to answer. Feel free to send me a chat and you can find me on Slack.

What are the plans for our DEI initiatives?

Catherine Goetz: Um And I will say amidst all the changes, right that we've gone through as an organization, one of the things that has not changed is our commitment and investment in diversity, equity and inclusion initiatives um within the organization. So at the end of last year, we introduced our first ever inclusion strategy and a three year road map. Um And the focus here is really on um the impact that we can make in three important places. So the impact and the value we can create for our people, um the impact and value we can create through our products and for our customers, right, for our brands and community. Um And so all of the work that we'll be doing over the next three years will have those three very distinctive benefits built into the initiative. Um so if we fast forward just a little bit to today, um our objective for 2023 is really simple. What we wanna do is create a shared understanding for all l peers about the fundamentals of diversity, equity and inclusion and specifically how that shows up for us, what that means in terms of creating value for our people, what that means in the way that we build and test our products and how that shows up as a value for our brands and for the broader community that we serve. Um And so I can give you some examples of some of the initiatives that hopefully you've either seen launch already and have been part of. Um or that you can look forward to for the rest of the year. Um So the first is around creating just shared experiences and opportunities to learn together. Our er G Leadership and Diversity Council have launched a series called Courageous Conversations and this is a monthly fireside chat. Um You are welcome to be camera off and just lean in and listen to conversations that perhaps you wouldn't otherwise have access to. And so we bring in experts to talk on um topics from the perspective of different lived experiences that ultimately are just gonna give us tools and resources and a shifted perspective on the ways that we can continue to show up for each other and the ways that we can infuse that benefit into our products. Um So if you have not joined us yet, please check out the global calendar, you'll find them once a month. We're rotating on time zones. So definitely a really good opportunity to um hear from folks that perhaps you otherwise wouldn't. Um the second is really around a dedicated learning path. So we know that there are some specific needs right at the individual level, for people who just want to build out their skill set um for managers around adopting equitable processes and building that muscle around inclusive leadership and for teams more broadly. And so we'll be introducing a learning path that curates specific types of self guided instruction that are gonna support people are really doing that development um specific to their, to their role within the organization. Um And then the third one is really around brands and community. So as important as this work is to us internally, our customers care about it too. And one of the most important things that we can do to demonstrate that this is important to us is to be transparent. Um So what you'll find are more quarterly updates that give the entire LP community visibility into things like workforce composition and what's changing and um what successes we've had, right, how a pulse and temperature on how people are feeling in the organization. And it also um means that we'll be delivering our first public annual report, which is something that we can share proudly with the community that defines how we think about diversity here at live person. Um what successes we've had and what progress we're making and where we still have room to go. So these are some of the things that you can expect for this year. Um, I look forward to seeing you either in the, er, g conversations on Slack. Um, we're at a courageous conversation soon.

What is the relation between Wild Health and LivePerson's core business?

Robert LoCascio: So what is the relationship between Wild Health and like versus core business? When we think about an AI company and we think about enterprise AI company. I really put that in the category of solving a consumer's most hardest intents. So we know, you know, dealing with your finances, your health. Um and the biggest brands is is painful and we have traditionally focused on the biggest brands in the world where you have to do, you're paying something or buying something. We've made that process easier. Um Health care is a big vertical for us. We have some of the biggest health care companies in the world. What we want to do with wild health was um you know, do a much deeper um integration, shall we say into healthcare ai uh your health and your finances as a person are the most important things in your life. Without your health, you can't do anything. And they developed a platform that uses machine learning data, large data sets of the body. So you take all the testing data from D N A blood. They use machine learning to correlate that. Now they're using generative AI to do the conversations and scale that where normally you would have a lot of humans. So I look at it as a very similar problem we're trying to solve with any enterprises taking these large data sets. How do you automate the flows of that? In this case, the day sets the data off my body. In the case of an enterprise, it's, it's a purchase data set or uh service, data set. It's how do you automate that? And I think going after this is important and if you look at almost every large tech company where it's Google Apple Amazon, everyone has a healthcare practice because if you can crack the nut has a lot of value, it's a four or $5 trillion problem in the US alone. And so yes, it's a little bit uh innovative. But if you crack that nut, it has a lot of with ai it has a lot, a lot of upside. So that's, that's the relationship to wild health.

Please qualify the long term view on remote employees?

Robert LoCascio: I uh you know, obviously we're all working remote in one way or another because we don't have a lot of offices. And matter of fact, even before when we did have offices, I think was 30% of our employees were remote sales field, they lived near customers. So we've always been technically had a big population of remote employees. I think what's important is even when we had that population, remote employees, we had a culture of connection. And I think more than ever, we made an effort to connect uh to connect physically, to connect with our customers. And we've lost a lot of that and I think that's what we have to bring back. It has to be prescriptive. We made a prescriptive in the past the way we even designed our offices or how we did meetings or off sites or even worked with our customers. We did this thing called meaningfully connected experiences are conferences. Uh You know, they're, they're about people facing each other and collaborating, not being in rows, looking at each other's heads, they're, they're looking at each other's uh faces and, and being connected. So I think we have to bring back the culture of connection even though we're working in a remote world. And how do we get more often, I think is what we have to be more prescriptive about. So.

Could you please speak to that cash issue/ debt refinancing referenced in SEC filing and the potential shareholder dilution selling addition

John Collins: We saw this as an opportunity to approach our largest noteholder and repurchase as much as we could at this discount in the marketplace, we secured nearly $160 million $8 million dollar discount for live person relative to what we would have had to pay if we waited to satisfy the notes at the maturity in the first quarter of next year. So the $8 million dollars obviously uh preserves capital for live person and the early retirement of those notes improves live person's credit profile, which is something we think the equity markets will appreciate.

"How can the product team make data-driven decisions and not go by ""gut""? How can we be more efficient in requirement to help engingeers?

Alex Kroman: So I definitely want to be working on making more data driven decisions on the product team. The way that I am planning on doing that is to really pay a lot of attention on product usage and my usage. I mean, the number of Dar's that is being generated by every customer and figuring out a model for how new features that we are creating and shipping, impact the level of Dar's and just having a very clear connection there and making it so that when product teams are innovating and building new things, um they just have a very close connection to how, what they're building is um impacting that Dar level. So that is what I think is the most important thing. Um Honestly, I don't really think we probably need to spend all that much time becoming more efficient in terms of gathering requirements. Um You know, I think that's really up to the product managers to talk to customers and then as their features get more adoption and are used more creating a, you know, creating a community of, of users who are using that feature, engaging and engaging with them either, you know, through meetings, conversations through, in product feedback um through our own, our own messaging software, which honestly, I think we should um you know, allow customers to just directly, directly, talk to engineering and product teams. So those are a few ideas.

When will our new product using LLMs be ready to sell to customers?

Alex Kroman: I don't have a definitive date on this right now. I know a lot of the teams are working really hard on this. We are planning to get um early product out to customers in April. Um And um you know, will be learning and iterating based on the feedback that we get from the early adopters. And I will, you know, be back in touch about this question very soon.

Is there documentation about LLM on the way? How can GRO keep informed about the program?

Alex Kroman: Christopher Donna Vick is taking on a new position in charge of product marketing. And the first goal that he has is really working on the marketing and materials for both the LM features as well as the voice features. Um It's just, it's not gonna be just him on that work. He's also going to be partnering with the product managers and engineering leaders to put all of that together. Um And it will be coming out in April uh as much, you know, and there will be a steady drip of documentation as it becomes available.

Can you provide us with more information about the new product that will utilise LLMs? What is it? How will it be priced?

Alex Kroman: The initial um feature set for LMS. Um I mean, there's a lot of things planned but the initial work is going to be uh an agent assist feature. So using LM technology to assist the agent in terms of what to say, as well as the ability to drive full LM based conversations off of knowledge AI. So that's the, that's the basic scope in the very, in the very beginning, there's a lot more to come from. That pricing is still something that is um very actively being discussed. So that is in progress.

Is there a clear plan for this so we can progress with our prospects?

Chris Radanovic: Hey, there, we are currently working on a go to market plan for all of our generative A I solutions that are coming in April with that plan. You will get onboarding information that you can give to the customer. You'll get materials that you can use to help showcase the value of generative A I and you'll also get commercial and other information with it. Um So look forward to that in the coming week or so and you'll start to see materials being pushed out. Thanks.

Does Chris have a timeline around commercials and pricing of the new products?

Chris Radanovic: Pricing and commercials are currently being worked out and finalized. And we will have those, uh along with other go to market materials uh here in the next couple of weeks so that you can have those important conversations with your customers.

Our big brands are expecting more detail around the data sovereignty/architecture of our April LLM release, for example where data will flow

Chris Radanovic: Yeah, we are seeing a lot of customers asking about how their data is handled and what the flow of data is. So to help overcome that challenge, we're going to create a diagram that shows the flow of data and how we are controlling and protecting brand data uh in the process of using L L MS for their program. Uh We're creating that along with several other go to market materials and we'll make sure to get those out as soon as they're available. Thanks.

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