Greetings and welcome to the Streamline Health third quarter 2019 earnings conference. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If you would like to ask a question, please press star, one on your telephone keypad.

If anyone should require operator assistance during the conference, please press star, zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Randy Salisbury, Chief Marketing Officer. Please go ahead..

Thank you for joining us to review the financial results of Streamline Health Solutions for the third quarter of fiscal 2019, which ended October 31, 2019. As the conference call operator indicated, my name is Randy Salisbury.

As Senior Vice President and Chief Marketing Officer here at Streamline Health, I manage all communications, including investor relations. Joining me on the call today are Tee Green, President and Chief Executive Officer and Chairman of the Board, and Tom Gibson, Chief Financial Officer.

At the conclusion of today’s prepared remarks, we will open the call for a question and answer session. If anyone participating on today’s call does not have a full text copy of our press release announcing these results, you can retrieve it from the company’s website at www.streamlinehealth.net or at numerous financial websites.

Before we begin with prepared remarks, we want to be sure we are clear for everyone on the record how certain information which may be provided today, as with all of our earnings calls, should be viewed. We therefore submit for the record the following statement.

First, statements made on this conference call that are not historical facts are considered to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

These are subject to risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from those we may discuss. Please refer to the company’s press releases and filings made with the U.S.

Securities and Exchange Commission, including our most recent Form 10-K annual report and proxy statements filed earlier this week for more information about these risks, uncertainties and assumptions, and other factors. As always, we’re presenting management’s current analysis of these items as of today.

Our participants on this call should take into account these risks when evaluating the topics we will discuss. Please note Streamline Health is not undertaking any commitment or obligation to publicly revise any such forward-looking statements made today. Second, we will discuss non-GAAP financial measures such as backlog and adjusted EBITDA.

Management uses these measures to help provide better insight into our financial performance; however, certain items of income and expense are not included in these measures, so these calculations may differ from those which another entity may utilize in calculating their own non-GAAP measures.

To help you compare these amounts on consistent terms, please refer to our website at streamlinehealth.net, our earnings release and Form 10-Q for a reconciliation of such non-GAAP measures to the most comparable GAAP measures. With that said, let me turn the call over to Tee Green, President and Chief Executive Officer.

Tee?.

Thank you Randy. Good morning everyone and thank you for joining us to discuss our fiscal year 2019 first nine months and third quarter performance, which ended October 31. Hopefully you have seen many of the strategic moves our company has made since we last spoke to you on our second quarter conference call.

I want to spend my time this morning discussing the importance of these moves and my vision for our company moving forward.

I have asked Tom Gibson, our Chief Financial Officer to discuss the specifics of our third quarter and first nine months financial performance as well as the amortization issue that caused this delay in our earnings report, and he will do that in a few minutes. First, I wanted to share with you my vision for our company.

Since I have been President and CEO, I’ve worked the leadership team to help us create a new vision for our company. That company is a smart, lean, entrepreneurial organization dedicated to solving the problems our clients face with issues in the middle of their revenue cycle, from charge capture to bill drop.

The primary driver of this company will be our eValuator technology which provides clients with a new and better way to improve their revenue integrity by analyzing every coded patient record before it is sent to billing.

We will augment this technology with our expert auditing services team, allowing us to sell technology-enabled solutions to help care providers who continually face more and more workflow challenges and simply cannot afford to hire additional staff.

To create this company, I challenged the management team to increase the velocity in every aspect of what we do. I want our team to be quick but not hurry, as John Wooden, the famed UCLA men’s basketball coach was fond of saying.

I wanted them to focus on removing the barriers we have been facing for a long time to enable us to change the structure of our company so that we can enter fiscal 2020, which begins February 1, in a better position to succeed.

Looking back over the past five months, I believe our company has accomplished a great deal to put us on the path I just described. In the second half of calendar year 2019, we have changed our debt partners, removed the preferred shareholders, and improved our capital structure and overall balance sheet.

In October, we successfully completed a capital raise that enabled us to buy back nearly 3 million preferred shares which had a $3 per share put option. The preferred shareholders had certain rights that were greater than our common shareholders, including the right to approve our senior lender.

We negotiated a favorable discounted rate to the face value of the preferreds and retired those shares before the end of the third quarter. Now all Streamline Health shareholders have the same rights, but as importantly, by removing certain restrictions, our company can be more nimble in its ability to implement strategic initiatives in the future.

Additional proceeds from the equity raise allowed us to pay down some of our debt with Wells Fargo and establish a new less expensive credit facility with Bridge Bank, which we announced on December 12. Today, we have a $4 million term loan with a $2 million revolving line of credit.

On December 18, we announced the signing of a definitive agreement to sell our legacy enterprise content management, or ECM business to Hyland of Westlake, Ohio for gross proceeds of $16 million. This transaction is an asset sale wherein Hyland Healthcare will receive our ECM technology and the contracts for our ECM clients.

We have filed a proxy statement and are soliciting stockholder approval for this transaction, which we anticipate closing shortly after the proxy period closes on or about February 15, 2020. ECM technology has been around for decades. In fact, Streamline Health was founded upon the ECM technology back in the late 1980s.

The company was called LanVision back then, but as we reported over the past five or six years, the revenue contribution from this business has been in steady decline by approximately $1 million to $1.5 million per year.

It has been difficult for our company to outgrow this revenue attrition, so with the sales of these assets, we will be a smaller revenue base company but one that will be able to grow its top line revenue more quickly.

Our plan is to use the proceeds of this sale to reduce our term and debt with Bridge Bank to zero and to invest in product development and sales and marketing in support of our eValuator technology.

Finally, just before the end of the calendar year, we invited Justin Ferayorni, Founder and Chief Investment Officer of Tamarack Global Healthcare Funds to join our Board of Directors.

What does our new company look like going forward? As detailed in the proxy we published earlier this week, effective with the closing and funding of this transaction, we will become that leaner, more nimble, more entrepreneurial company we envision centered around a technology platform that is still very new in the marketplace with great upside potential.

We will be a predominantly recurring revenue, SaaS-based company with approximately $10.5 million in recurring revenue in 2020, and we will have approximately $9 million of cash on our balance sheet and no bank debt. In fiscal year 2020, we will focus on growing that recurring revenue base primarily through the sale of eValuator.

We do not anticipate generating positive EBITDA as we make this transition but believe we will make the turn before the end of fiscal 2020. We will focus on profitability in tandem with growth as we move into fiscal year 2021 and beyond. Before I turn the call over to Tom, I want to comment on the health and promise of our sales activities.

In the fourth quarter and beyond, our sales pipeline continues to look promising. We have more than two dozen prospects in the final stages of the sales cycle, some of which are in the contract stage and could close this month or in Q1. All of them represent an average annual recurring revenue projection of approximately $300,000.

This ARR is double that of the average of our current eValuator clients. The reasons for this increase in annual revenue opportunity are based on experience gained over the previous year or so and the focus on working closely with the largest EHR providers, specifically Epic.

Last month, our eValuator application was approved by Epic to appear in their App Orchard marketplace.

Now, Epic clients looking for ways to improve their revenue integrity can find our eValuator solution on the site, signifying our technology integrates with the Epic EHR, thereby removing any obstacle based on fear of not being an Epic-approved application. The early stages of our sales pipeline includes nearly 40 accounts with a similar average ARR.

In total, we have more than $50 million of total contract value in the sales pipeline at this time. We will continue to add prospects as we build awareness and preference for the eValuator platform.

I will now turn the call over to Tom Gibson, our Chief Financial Officer to provide additional commentary on our third quarter performance and other items.

Tom?.

Thank you Tee, and good morning to everyone on the call. Since I last spoke with you, the company has executed on several significant initiatives that complement the highlights for the third quarter ended October 31, 2019.

These include the correction of an error on amortization expense, the capital raise and related redemption of our preferred shares, our new banking deal with Bridge Bank, and the pending sale of our ECM business.

We will address these major financial initiatives first, followed by an overview of the company’s third quarter and nine months ended October 31, 2019 financial performance. The company disclosed that it identified certain errors in the company’s calculation of reporting amortization expense on its capitalized software development cost.

The error was to a large degree self-correcting through Q3 2019, meaning that there was an initial over-amortization of software that was prospectively reduced each period by an under-amortization.

The company determined that no previously issued financial statement was materially misstated and accordingly the company recorded an out-of-period adjustment in Q3 2019. There is no more error related to this amortization expense as of the end of Q3 2019.

The impact to Q3 2019 is under-amortization resulting in higher net income of approximately $214,000. This matter caused a delay in the filing of the company’s 10-Q for the period ended October 31, 2019, which the company filed earlier this week.

Next, the company successfully executed on a significant capital raise of $9.7 million primarily to fund the redemption of all outstanding preferred shares at a discount to book value.

Both of these moves, the capital raise and related redemption of the preferred shares, were necessary to complete another key initiative, and that is the new banking relationship.

As previously announced, the company was interested in changing bank partners, and with the aforementioned moves, we were able to close on the new credit facility with Bridge Bank on December 12, 2019.

The proceeds from the Bridge Bank term debt were used to pay all of the outstanding balances with Wells Fargo, effectively closing out that relationship. This will be reflected in the company’s annual 10-K for the period ended January 31, 2020.

Lastly, the company signed a definitive agreement on December 17, 2019 to sell its ECM business to Hyland Healthcare. This sale represents the removal of a significant hurdle the company has had to overcome on the path to achieving its ultimate goal of becoming a fast growing healthcare technology company focused on the middle of the revenue cycle.

The sale of the ECM asset will free the company from its legacy-based revenue stream that was atrophying every year. As a result of signing the definitive agreement, the company anticipates the ability to report the ECM business as a discontinued operation, which will impact all prior periods.

This will remove the revenue from the GAAP financial statements and show the appropriate amount of growth from the remaining solutions and services. We are all very excited about this last key initiative and how we believe it positions the company to achieve an accelerated rate of growth going forward.

Now let me turn to the company’s operating performance for the third quarter ended October 31, 2019.

As announced in yesterday’s press release regarding our performance for the third quarter and for the nine months of fiscal 2019, we generated revenue of approximately $5.8 million, up approximately 20% sequentially as compared with the previous quarter’s revenue and up 8% from the third quarter of the last fiscal year.

Total revenues for the nine months of fiscal year 2019 were approximately $15.9 million, down approximately 6% from $16.9 million in the same period last year. Turning now to bookings in the third quarter, the company has publicly announced an ongoing target of between $2 million and $3 million in bookings per quarter.

The actual historical bookings for five quarters from Q2 of last year through Q2 of this year have been $1.9 million, $1.8 million, $1.1 million, $1.4 million, and $3.8 million respectively, certainly not as consistent as we expected.

Our Q2 2019 bookings comprised of $3 million of eValuator represents a pace of go-forward revenue contribution that can help us overcome any remaining attrition and return to top line revenue growth in the periods ahead.

While the bookings for Q3 2019 of $2.6 million achieved a level within our target range, the bookings did not include new eValuator sales.

That said, according to my model, the total bookings through the first nine months of fiscal 2019 are sufficient for the company to return to top line revenue growth in fiscal year 2020, assuming the ECM deal with Hyland closes in February as planned.

Recurring revenues were approximately 67% of total revenues for the third quarter, lower than the 82% from the second quarter of this year. The lower recurring revenues as a percent of total revenue is directly related to the single significant perpetual license sold and recorded in the third quarter of 2019.

Moving now to adjusted EBITDA, we generated $1.3 million in Q3 of 2019 as compared with $200,000 in Q2 of 2019 and $800,000 in Q3 of last fiscal year. The adjusted EBITDA for the third quarter October 31, 2019 is not impacted by the $214,000 out-of-period adjustment as discussed at the beginning of my remarks.

Adjusted EBITDA for the first nine months of fiscal year 2019 was $2.7 million, up nearly 50% from $1.8 million in the first nine months of last fiscal year. Some of this is a direct result of our successful cost savings initiative we completed last year. That initiative is having a positive impact on operations without regard to the lower revenue.

The company is beginning to see the cost savings initiatives over the past few quarters be overtaken by certain increases in sales, marketing, and other corporate expenses that we believe will return greater revenue growth in the coming quarters. As previously disclosed, the company continued to incur costs related to the CEO transition.

The CEO transition costs totaled $481,000 in the third quarter and $562,000 for the nine months ended October 31, 2019. These costs pertained to recruiting fees, fixed retention bonuses for certain key executives, and a consulting agreement necessary to successfully transition the new CEO.

These executive transition costs do not include the fees paid to our interim president and CEO as it is not an incremental operating cost. The company continues to anticipate that these costs will total approximately $800,000 for the full fiscal year 2019 as originally detailed in our second quarter earnings call.

The company has experienced certain costs for sustaining our loan agreement with Wells Fargo and other non-operating transaction costs. These costs totaled $131,000 and $205,000 respectively for the three and nine months ended October 31, 2019. The company will recognize additional cost in the fourth quarter and full year fiscal 2019.

The total cost of these activities is estimated to be approximately $350,000 for the full fiscal year 2019. Additionally, the company recorded $91,000 and $239,000 respectively of interest expense for the third quarter and first nine months of fiscal 2019 compared with $106,000 and $332,000 respectively for the same periods last year.

Lower interest cost is driven primarily by higher amounts of interest being capitalized to our capital software development asset.

Turning now to other areas, the company recognized $447,000 in Q3 2019 and $1,331,000 in the first nine months of fiscal 2019 of non-cash depreciation and amortization compared with $573,000 and $2,305,000 in comparable periods of the prior year.

The company’s depreciation and amortization has been trending down as more assets have become fully depreciated; however, there will be a slight trend upward now due to new enhancements that are being put in place under our capitalized software development as well as the out-of-period adjustment discussed earlier.

The company also recognized $290,000 and $125,000 of share-based compensation for the third quarter of fiscal 2019 and 2018 respectively.

The share-based compensation is higher in the third quarter of fiscal 2019 as compared to the same period a year ago because of certain actions initiated by the board to hire a new chief revenue officer effective February 2019 and secure the interim CEO who has now converted to full time, and to retain certain other key executives as a result of the vacancy left from the previous CEO.

The reported share-based compensation will continue to trend higher in the remaining quarter of fiscal 2019 and into 2020 from previous levels. The company has always experienced seasonality in its cash balance. The company invoices approximately $5 million in and around early November of each year for annual licenses to certain legacy products.

Those legacy invoices are collected in January and February of the following year. What is left is a company that uses cash specifically in the late summer months and early fall. Substantially all of these seasonal paying customers are from the ECM business that is being sold.

Beyond operations for the first nine months of fiscal year 2019, we invested $2,700,000 into the capitalized software development asset, primarily being new functionality for our key client solution, eValuator. This is comparable to $2,300,000 in the same period a year ago.

We have previously reported that we were not expecting to invest as much in the full fiscal year 2019 as we invested in fiscal 2018; however, given the opportunities that we are seeing in the marketplace and as articulated by David Driscoll, our CRO, we believe it’s essential to continue our investment in eValuator at levels similar to last year.

The company sees the features and functionality of its flagship technology to be a significant opportunity to expand its sales velocity.

Continuing to expand the capabilities of eValuator for inpatient, outpatient, and professional fee settings as well, as improving the functionality of our dashboards, we believe will help us improve our sales success. The company continues to have flexibility with the investments we make into our software, both the timing, nature and type of spend.

It is worth noting that in the company’s MD&A disclosures, total research and development costs are going down. This is the result of more cost proportionately being capitalized into software development. This trend should continue to develop through the remainder of fiscal 2019 and into fiscal 2020.

The company has reduced headcount and refocused its R&D efforts around the company’s ongoing solutions, while less effort is being attributed to older legacy solutions.

During the third quarter, the company made its regular $150,000 quarterly payment on its term loan, the balance of which was down to $3.5 million net of financing costs at the end of October 2019. There are no quarterly payment required for the first 12 months of the new term loan with Bridge Bank.

The company believes that the new debt facility with Bridge Bank is adequate in every way to finance its current operations. The company reported all of its term debt with Wells Fargo as current on the balance sheet at October 31, 2019.

The company has the intent and ability through the anticipated sale of its ECM business to pay all the term debt upon closing and funding. We estimate we will close and fund the sale of the ECM business on or about February 15, 2020.

The company reiterates its guidance for fiscal year 2019 in projecting recognized revenue between $20.5 million and $21.5 million and adjusted EBITDA between $3.0 million and $3.5 million.

That concludes my remarks, but before I turn the call back to Tee, I wanted to reiterate that I believe we have made great strides in managing the business during this transition to focus on solutions and services to help clients with the middle of their revenue cycle. There is tremendous growth opportunity for the company’s products in this space.

The company has been on the right trajectory and we are laser focused on what we can do to accelerate our path and to realize our full potential.

Tee?.

Thank you Tom. To conclude my remarks this morning, I want to reiterate how encouraged I am by the leadership team’s excitement and belief in our company’s go-forward structure. Our velocity is picking up as we focus on the right things each and every day to move our company ahead and demonstrate the value we bring to our clients.

I am very excited to lead this company, especially with the smart strategic moves that we have made over the past few months. There is a lot of work to be done to be as successful as I know this company can be, so I want to thank our Streamline Health associates for their commitment and ongoing focus to win the day.

I thank everyone on today’s call for your support of our company as we make this important turn in our company’s future. I see great potential here and I am very excited about it. I will now turn the call over to the Operator for our Q&A session.

Operator?.

[Operator instructions] We have a question coming from Matt Hewitt of Craig-Hallum. Please go ahead..

Good morning. Thank you for the update.

Can you hear me okay?.

Yes, we can hear you fine. Thanks Matt..

Okay. First off, regarding the eValuator pipeline, you gave us a couple metrics.

I’m wondering if you could give us a little bit more color as far as maybe the types of accounts where you’re seeing some initial traction and maybe you’re seeing that become larger in the pipeline; secondly, whether or not you’re seeing some initial success because of the inclusion into the Epic App Orchard; and then thirdly, regarding the timing of closing some of these eValuator pipeline opportunities, are you seeing that time to close shorten at all, or where does that sit?.

Randy, do you want to take that?.

I will take that, thanks. Matt, I would say, if I remember all three of the questions, let’s start at the back and move up. I think the timeline remains very similar. I don’t think it’s shortening yet. Part of that is because, as we’ve talked with you before, this is a new sale, it’s not one that people are out in the market necessarily looking for yet.

We get very few RFPs, a lot of greenfield here and whitespace.

With regard to the size, as we mentioned back in the last spring, early summer, Driscoll was the one that said, hey, look guys, I have found in my life that when you have a new solution, new technology, larger IDNs and hospital provider systems move more quickly for that than smaller ones, and part of it is because when we run their data analysis and show them the value that they can receive from using eValuator, the dollars kind of speak for us.

I would say that what we’ve done is we’ve moved from a foot in the door with HIM directors at smaller properties, and when I say smaller, they’re not teeny, they’re still paying between, say, $75,000 and $150,000 a year for three-year contracts.

We’re now moving to those that, as we mentioned in today’s call, they’re averaging more like $300,000 a year for three-year contracts. Some are dramatically higher than that. There’s still a couple in the $150,000 range as well.

What was the second part of that, Matt?.

Just maybe characterize the type of accounts that you’re seeing. Are these large health systems, are these individual hospitals, divisions within hospitals? Just if you could help us understand the types of contracts..

Yes, sure, and then you also asked about Epic Orchard. Going back to that question, no, these are almost all universally large hospital systems, not unlike what we did in Q2. For instance, we had talked before, Matt, about CHI, which is Catholic Health, now Common Spirit as they merged with Dignity.

When we signed that contract in July, it was only for X-number of their facilities with planned in the MSA a rollout to all of the others - I think they have more than 100, so more in the pipeline are the multi-facility healthcare providers, and then that gives us the opportunity to say, look, you don’t have to sign all of them right away, we can start with the first 10 or 20 and grow from there.

A lot of them start with inpatient, then we add outpatient and then we’ll add pro fee, so there’s some internal growth that we can do with those as well.

Speaking of Epic Orchard, we’ve not seen a flow yet of new opportunities from that specifically because we’ve only been in it for about a month, but we’re just now starting to promote the fact that we’re in there. We mention it in conversations with Epic-based prospects, so it’s certainly helping, Matt, but it’s not driving demand yet. .

That’s great, thank you. Shifting to one of Tee’s comments in his prepared remarks when he was talking post-transaction, post-divesting the ECM business, there was going to be a desire to reinvest some of those dollars into sales and marketing.

Could you give us your thoughts as far as where will sales and marketing headcount be upon closing that transaction, and then where would you like to see that maybe a year from now from a headcount perspective?.

Tee, you want to take that or you want me to?.

Yes, thanks. I’ve got it.

Can you hear me?.

I can..

Okay, great Matt, thanks.

We’re in the [indiscernible] planning of 2020 now, Matt, so I don’t have the specific number, but evaluating the regional approach where we have [indiscernible] four or five regions and we have those RVPs reporting up to the chief revenue officer, Driscoll, we’re also exploring opportunities with our thought leaders around the country that can bring us into transactions and bring us into the C-suite.

Then thirdly, we’re evaluating whether to not third parties, whether it’s consulting firms or others, can be distributors of this technology. I don’t have a specific number yet, but all of that is under discussion through the month of January. .

Understood, all right. Thank you..

Tom, do you want to add specifics on that? Tom, anything you want to add to that?.

No, I think all indications--hey Matt, by the way, how are you doing? Good to talk to you in 2020. Yes, I would just say that I feel like our spending levels now are probably going to be pretty consistent in 2020 in the sales and marketing area.

It feels like we’re spending the right amount of money, we just may distribute it differently going forward with some of the changes we’re talking about. .

Understood. All right, thank you. Last question, in the proxy that was filed last night, you included some figures, some prospective financials going ’21 through ’23 that imply some pretty robust growth. I guess two questions related to that.

Number one, how would you characterize those prospective financials? Are those kind of a base case, bull case, bear case? Maybe just kind of lay that out. And then secondly, what will be the key drivers to obtaining or reaching those targets? Thank you..

Yes, Matt, that’s all mine. We’ve put together kind of a top level model, and that growth is based on $2 million to $3 million of eValuator bookings per quarter, really not moving the dial at all on any of our other solutions but just growing the eValuator technology again with bookings of $2 million to $3 million per quarter.

It has quite the impact, so I think our goal that we have had in the past is something that we’ll really be able to shine going forward because we won’t have some of the revenue bases that were attriting. Anyway, that’s your answer. I think it’s $2 million to $3 million of eValuator sales per quarter. .

Excellent. Thank you very much..

Thank you. Our next question is coming from Brooks O’Neil of Lake Street Capital Markets. Please go ahead. .

Good morning guys. I have a couple questions as well. I guess my first one is a pretty basic one.

Could you just describe any closing conditions related to the sale to Hyland?.

Yes, hey Brooks, it’s Tom Gibson. Thank you for the question. Really it’s just the standard closing conditions, that there can’t be a material adverse change in the business. That is it. It is a firm contract to purchase the business as soon as we get shareholder approval..

Great.

Secondly, I think I understand this, but what would you say to people who say you just sold your whole business?.

I would say that that’s not the case at all.

Do you want to take it, Tee, or do you want me to take it?.

Yes, well let me--this is Tee. I’ll [indiscernible] because I’m fairly new to the Streamline story.

[Indiscernible] the last--I think it’s in the prepared remarks, the last several years the ECM business was declining in revenue year after year, and so as I looked at this business and looked out over the next three years, I think that business, the attrition would accelerate, so I certainly don’t look at it [indiscernible].

I think the business has pivoted now to a growth business and focused on a needed technology in the middle of the revenue cycle [indiscernible]. I certainly look at it as we didn’t sell our whole business, we enabled this business to be a growth story going forward rather than a sinking ship.

Tom, you want to add to that?.

No, I think you said it exactly right, Tee. We would have been sitting here three years from now with a fraction of the revenue that ECM had, because for us to catch our technology up to where Hyland software was, it was just too much money for a shrinking business.

Also, if you look out in the market space and think about content management solution as a technology, some of that technology is getting overtaken by Epic and some of the other big EHR systems, whereas what we are investing in is a new area of the market, and we’re on the cutting edge of helping clients bill and collect faster and more accurately.

So yes, we feel like we’re doing exactly what we need to do as a business..

I think that’s great. It sounds like you’ve done exactly the right thing. I just have one more quick question.

Can you guys describe quickly the competitive set in your new target markets and whether you see anybody you think is going to provide significant impediments to your growth going forward?.

[Indiscernible] thanks..

Yes, sure. Hey Brooks, it’s Randy. First, I look forward to seeing you next week.

Secondly, we’ve talked about this before, but in the middle of the revenue cycle, we’ve got three or four technologies and one service, so with regard to the services, which is auditing services, most of the competitive set in auditing services are smaller independent organizations, so nothing really, no juggernaut there.

We’ve talked a fair amount, Brooks, about how with the eValuator technology for automated pre and even post coding analysis, we see about three primary competitors. In no particular order, PwC SMART has had a technology in the market that they tend to sell only to clients that use their consulting business.

It’s not quite like ours - it was mostly a post-bill that they’ve tried to move to the front end, but they’re there. When we announced, Brooks, in July that we had won the Memorial Hermann account, it was at the expense of SMART, which had been in there for four or five years.

Secondly, I would say there’s a company, a private company called Revint - R-E-V-I-N-T. Two summers ago, they acquired two different companies, small companies on the same day - CloudMed and AcuStream. Again, one of them is services based but the other is technology.

Again, different than ours but still [indiscernible], and they tend to chase it as a we’ll share the profits of what they can help you collect through better coding accuracy. They’re mostly an at risk kind of model, pricing model, which by the way we can do as well.

Then thirdly, I would say 3M has had an older technology called Audit Expert in the market for 20-plus years, way back when we had ICD-9 coding. They’ve tried to update to ICD-10. I don’t think it’s much of a competitive set yet but there’s been rumblings, Brooks, that they’re going to update that and try to bring it to market in a new model.

Part of what we’re seeing is that a number of us are showing that there’s a real market here for this pre-bill coding analysis, and frankly, that’s good because if we were the lone voice out there, I think it’d be a longer, harder road.

When we talk about investing in eValuator going forward in sales and marketing, it’s also in development, and we want to make sure that we are the leading technology in this space and that’s what we’re committed to. .

That’s great.

Go ahead, sorry?.

I just wanted to add a couple comments to Randy, he did a great job with it. But what gets me excited is that as of today, we’re the only pre-bill technology, and where that’s an advantage is in the workflow.

Our workflow is designed to pre-bill as opposed to a lot of our competition, which is post-bill audits that have to kind of retrofit it to the pre-bill side.

Also, as you know, our technology is a rules-based engine, which means that once we get into a particular hospital, if we can help them specifically because of some of their specialities, we can write improvements to our rules and help them identify oncology or whatever they’re struggling with in particular.

I think those two are what get me excited about the product..

That’s fantastic. Thanks a lot, and I’ll look forward to seeing you guys next week..

Great, thanks Brooks..

Thank you. At this time, I’d like to turn the floor back over to Mr. Salisbury for closing comments..

Thank you again for your interest in and support of Streamline Health. If you have any additional questions or need more information, please feel free to contact me at randy.salisbury@streamlinehealth.net. We look forward to speaking with you again in April when we will discuss our fourth quarter and fiscal year 2019 financial performance. Good day..

Ladies and gentlemen, thank you for your participation. This concludes today’s event. You may disconnect your lines at this time or log off of the webcast, and have a wonderful day..