nCino, Inc. 10-K

Item 1. Business Overview As employees at financial institutions do their daily work and serve their clients, they often face inefficiencies due to disparate systems, broken workflows, manual processes, and the inability to harness and utilize data effectively. This negatively impacts risk management, decision making and the experiences of bankers and their clients. To solve the problem, FIs need technology that helps them reengineer every experience, intelligently and with agility as market needs shift, and a partner with the experience to help advise on best practices. nCino's trusted platform enables FIs to consolidate vendors while optimizing operations by integrating AI and actionable insights to cohesively bring together people and data and thereby enhance strategic decision-making, risk management, and customer satisfaction. From managing complex credit portfolios to streamlining account onboarding and originating loans, nCino helps FIs of all sizes globally deliver faster, intelligent, and more connected experiences. With the nCino Platform, FIs can: • Embrace the Power of Intelligent Automation and Uncover Data-Driven Insights . AI is rapidly changing the financial services industry. As AI creates new value streams within banking, nCino is simplifying FIs' navigation through this transformative technology by infusing AI into every stage of the banking lifecycle and creating intelligent automation across the nCino Platform. • Improve Efficiency . nCino customers leverage the platform’s capabilities to drive process and knowledge efficiency by connecting previously disjointed functions, breaking down internal silos, and infusing intelligent automation into key workflows across multiple lines of business. • Elevate Employee and Customer Experience . The nCino Platform's automation, workflow and digitization capabilities help eliminate manual processes and redundant efforts, freeing an FI's employees to focus on their clients’ experiences rather than their transactions. • Manage Risk and Compliance More Effectively . The nCino Platform can help FIs reduce regulatory, credit and operational risk through workflow and automation, data reporting, standardized risk rating calculations and financial modeling. Because nCino is highly configurable, it can adjust as regulations and the FI's risk requirements evolve, including regulatory changes and economic headwinds. Our Journey nCino was originally founded in a bank to improve that institution's operations and client service. After realizing that virtually all banks and credit unions were dealing with the same problems—cumbersome legacy technology, fragmented data, disconnected business functions, and a disengaged workforce that made it difficult to maintain relevancy in their clients' lives—nCino was spun out as a separate company in late 2011 to help more institutions solve these challenges using cloud-based technology. We initially focused on developing the nCino Platform to transform commercial and small business lending for community and regional banks in the United States ("U.S."). We scaled the platform to enterprise banks in the U.S. in 2014, and then internationally in 2017. We have subsequently expanded across North America, Europe, the Middle East, Japan and Asia-Pacific ("APAC"). nCino's approach to market expansion includes strategically building products and acquiring technology to continue to fulfill a platform vision. Over the years, we built and enhanced products internally to ensure innovation and seamless integration across key solution lines of commercial, small business and consumer banking. Through the strategic acquisitions of SimpleNexus, DocFox, FullCircl, ILT, Visible Equity, FinSuite, and our recent acquisition of Sandbox Banking, we significantly augmented the nCino's Platform's capabilities for mortgage lending, onboarding, account opening, indirect auto lending, and advanced analytics and AI. This strategic approach has allowed us to create a unified platform of best-in-class intelligent solutions, enabling FIs to replace multiple legacy systems, connect their operations, and streamline workflows and processes across various business lines to achieve desired business impact and process improvement. 1 Table of Contents How the nCino Platform Works nCino offers a trusted platform that brings together people and data and enables FIs to enhance strategic decision-making, risk management, and customer satisfaction through the selection of best-in-class intelligent solutions that create experiences to fit their needs. With the flexibility to select and implement multiple solutions simultaneously, or one at a time, institutions have the autonomy to create the experiences they desire with the benefit of an agile platform that scales with their needs and provides integrated functionality with every new product or feature added. Once implemented, the nCino Platform becomes deeply embedded in our customers’ business processes, enabling mission critical workflow across the FI and allowing our customers to serve their clients anytime, anywhere, from any internet-enabled device. The nCino Platform combines industry, customer, and process data with advanced analytics, predictive AI, and generative AI to deliver best-in-class, intelligent solutions. These solutions empower FIs with process, knowledge, and platform efficiency to optimize operations, enhance decision-making, and enrich banker and client experiences for accelerated growth. Fundamental elements of the nCino platform are built on Salesforce (the "Salesforce Platform"), which allows the Company to focus product development efforts on building deep vertical functionality specifically for FIs, while leveraging Salesforce's global infrastructure, reliability, and scalability. nCino also has solutions that leverage the Amazon Web Services ("AWS") platform. nCino has evolved from being a single product workflow solution to a platform that offers best-in-class, intelligent solutions. As a result, we have shifted from a seat-based pricing model to a pricing framework that helps ensure value-based positioning and pricing of our products primarily based on the asset size of the FI. This also enables us to embed and monetize intelligence across all our solutions. Through this evolution, we are aligning our revenues to the value of the nCino Platform and encouraging customer growth as nCino creates more efficiencies for our customers. Solutions on the nCino Platform The nCino Platform is embedded with data and AI that help FIs digitize and reengineer business processes across multiple lines of business from commercial, consumer and small business banking to mortgage lending to boost efficiencies across the full customer lifecycle. • Onboarding. nCino's onboarding streamlines and enhances the customer onboarding process for FIs through a unified, digital platform. It supports both credit and non-credit onboarding, commercial account opening, and enterprise-level onboarding, offering features like automation, centralized data, and compliance tools (CDD/KYC). The platform eliminates manual processes, accelerates account opening, and provides a 360-degree customer view, ensuring transparency and efficiency. With intelligent document management, seamless integrations, and personalized customer experiences, nCino helps institutions boost customer satisfaction, operational efficiency, and revenue growth while helping to maintain compliance and reducing errors. • Account Opening. nCino's account opening capabilities are designed to provide a seamless, fast, and user-friendly experience for both consumers and small businesses. The Deposit Account Opening (DAO) solution allows customers to open accounts in minutes, whether online or in-branch, with a multi-channel approach that provides data continuity. Key features include automated identity verification, helping to maintain compliance with KYC/AML regulations, and partnerships with companies like Plaid and Alloy to streamline authentication and reduce fraud. The solution also integrates digital customer service options, such as chat, audio, and video, to enhance engagement and reduce abandonment rates. • Lending. nCino provides a comprehensive loan origination platform for commercial, consumer, small business, and mortgage lending, that streamlines processes and enhances customer experiences. Our Commercial Loan Origination System automates the entire loan lifecycle, improving collaboration, compliance, and efficiency. The Consumer Lending solution, offers an omnichannel solution with automated credit decisioning and integrations to reduce cycle times. The Small Business Loan Origination solution leverages automation and machine learning to simplify applications and accelerate approvals, while the Mortgage solution unifies the home buying process, reducing closing times. These capabilities enhance operational efficiency, help ensure compliance, and deliver seamless, customer-centric experiences. • Portfolio Management. nCino's portfolio management solution empowers FIs to efficiently manage credit risks, monitor performance, and uncover growth opportunities through a unified, data-driven platform. The 2 Table of Contents solution centralizes data, automates workflows, and provides real-time insights to enhance decision-making and operational efficiency. Key features include continuous credit monitoring, risk analysis, and profitability optimization, supported by tools like automated spreading and commercial pricing. nCino's Portfolio Analytics solution offers customizable dashboards to track loan, deposit, and application data, helping to ensure compliance with regulations like CECL and Fair Lending. By integrating front, middle, and back-office processes, nCino enhances transparency, reduces manual tasks, and supports proactive risk management, enabling institutions to adapt to market changes and drive strategic growth. Our Customers As a pioneer in cloud banking, we have developed trusted relationships and a reputation for successfully implementing our solutions with FIs of all sizes in multiple geographies. Our diverse customer base ranges from global FIs, such as Bank of America, Barclays, Santander, and TD Bank; to enterprise banks, such as Truist Bank and U.S. Bank; to regional and community banks, like WaFd Bank, and ConnectOne Bank; to credit unions, such as Navy Federal Credit Union, SAFE Credit Union, Marine Credit Union, and Conexus Credit Union; to new market entrants, such as challenger banks like Recognise Bank and Judo Bank; to independent mortgage banks like Synergy One Lending and Fairway Independent Mortgage Corporation. These companies represent a cross-section of FIs across asset classes and geographies and each of these customers represent a substantial level of Annual Contract Value ("ACV") in its respective category. We ended fiscal 2025 with 2,789 customers, of which in fiscal 2025 we had 549 that generated more than $100,000 in subscription revenues, 105 that generated more than $1.0 million and 14 that generated more than $5.0 million. No single customer represented more than 10% of total revenues in fiscal 2025. How nCino Will Grow We intend to continue growing our business by executing on the following strategies: • Expand Within and Across Our Existing Customers. We believe there is a significant opportunity to further expand within our existing customer base both vertically within and horizontally across, business lines. Our customer expansion opportunities are now further enhanced with our focus on embedding AI capabilities within our Platform to further enhance efficiency and mitigate risk. nCino is transitioning to a new asset-based pricing strategy (as reflected in our new pricing model) where our subscription revenues from existing customers will continue to grow with their portfolio assets and artificial intelligence capability consumption, which should also simplify the buying experience for our customers. • Expand Our Customer Base. We believe the global market for an intelligent banking platform is large and underserved. With FIs needing to replace legacy point products with modern technology and increased consumer demand for digital services and AI, we believe there is a significant opportunity to deliver our solutions and expand our customer base to FIs of all sizes and complexities around the world. Currently deployed in over 20 countries, we have made significant investments to expand our presence in EMEA and APAC. We promote sales in North America out of our offices in the U.S. and Canada, in APAC out of our offices in Australia, New Zealand, and Japan, and in EMEA out of our offices in the UK, South Africa and Spain. • Continue Strengthening and Extending Our Product Functionality. We invested 23.9% of our revenues back into research and development in fiscal 2025 and expect to continue to invest in fiscal 2026 to continue to extend the breadth and depth of the nCino Platform. Current plans direct that investment across nCino's solution lines and geographies and aim to enrich experiences and drive additional efficiencies into financial processes that are foundationally underpinned by the nCino Platform. These plans include a focus on augmentation of human in the loop processes, as well as process automation, both driven by practical deployment of AI and agentic concepts that can further reduce the human resources required for routine, time-consuming tasks. • Foster and Grow Our SI and Partner Technology Ecosystem . nCino is focused on attracting and managing a rapidly growing network of organizations that collaborate to achieve shared success goals for our customers across the globe. Utilizing the open architecture of the nCino Platform, an increasing number of technology partners, including Anthropic, AWS, Databricks, Salesforce, Rich Data Co, Alloy, Plaid and Docusign, are integrated within our Platform. Leveraging our recent acquisition of Sandbox Banking, we are focused on 3 Table of Contents scaling our ecosystem strategy and business model to supplement our existing direct sales model. The aim is to deliver greater value to customers by leveraging the combined strengths and capabilities of all participants (customers, technology partners, and consulting partners) in our ecosystem. Expanding the ecosystem business can drive value in many different ways, including expanding our reach and access to new markets, driving new innovations and value creation, creating better customer experiences, and accelerating growth. This approach helps us address the demands we see in the market for embedded, customizable experiences and solutions that are easy to buy. We also have deep, long-standing relationships with leading consulting partners across the regional and enterprise banking space in every priority market across the globe. These partners (including Accenture, Deloitte, PwC, and West Monroe Partners, among others) assist in prospecting, marketing, co-selling, product evaluation/feedback and implementation of our solutions and have helped support our new market and global expansion. • Selectively Pursue Strategic Transactions. In addition to developing our solutions organically, we may selectively pursue acquisitions, joint ventures, or other strategic transactions, such as our recent acquisitions of DocFox, FullCircl, ILT, and Sandbox Banking. We expect these transactions to focus on innovation to help strengthen and expand the functionality and features of our solutions and/or expand our global presence. Our Relationship with Salesforce We built fundamental elements of the nCino Platform on the Salesforce Platform to leverage its global infrastructure, reliability, and scalability. This allows us to benefit from continual improvement of the Salesforce Platform. We believe we have a mutually beneficial strategic relationship with Salesforce. Pursuant to our agreement with Salesforce, when we sell our client onboarding, loan origination, and/or deposit account opening solutions, we include a subscription to the underlying Salesforce Platform and remit a subscription fee to Salesforce. In exchange, Salesforce provides the hosting infrastructure and data center for these applications, as well as configuration, reporting, and other functionality within the Salesforce Platform. Under our agreement with Salesforce, we are an authorized reseller of Salesforce’s CRM functionality to certain FIs in the U.S. Our original agreement with Salesforce was entered into in December 2011, which was superseded and replaced on June 19, 2020. On December 20, 2023, our agreement with Salesforce was amended and its term was extended to expire on January 31, 2031 unless earlier terminated by either party in the event of the other party’s material breach, bankruptcy, change in control in favor of a direct competitor, or intellectual property infringement. Our agreement with Salesforce automatically renews for additional one-year periods thereafter unless notice of termination is provided. Global Revenue Organization Our Global Revenue Organization includes business development representatives, account executives, field sales representatives, and marketing. These teams are responsible for demand and lead generation, driving new business, and helping to manage account relationships and renewals, to drive adoption of our solutions within and across lines of business. These teams maintain close relationships with existing customers and act as an advisor to each FI to help identify and understand their unique needs, challenges, goals, and opportunities. In addition, our marketing team oversees all aspects of the nCino global brand including brand strategy, public relations and external communications, integrated marketing, product marketing, market strategy, marketing operations, and regional marketing. Our marketing efforts span the full buyer journey from brand awareness and pipeline generation to adoption and cross-sell . Customer Success Once a customer contracts for the nCino Platform, we provide implementation services to assist in the deployment, either directly or through our SI partner ecosystem. For regional and community banks, we usually handle implementation ourselves. Most of these engagements average less than six months, significantly reducing the time-to-value for our customers. We expect to further reduce these timelines next fiscal year, given our investments in AI tooling and strategy. For our largest enterprise FIs, implementation timelines may extend beyond twelve months, primarily due to the complexity of adjacent program integrations, core conversion activities or other material infrastructure upgrades. For SI-led projects, we collaborate with SIs such as Accenture, Deloitte, and PwC, fielding a small team of advisory consultants alongside the SIs to help ensure success. 4 Table of Contents We support our customers with 24/7 access to engineers and technical support personnel, outcome-based support offerings, release management, managed services, and technical support via online chat. The nCino Customer Success Management team is the central contact for our customers, focusing on adoption, FI readiness to capitalize on new innovation, and helping our customers achieve the business value they expect. A significant majority of our FI customers whose employees utilize our client onboarding, loan origination, and deposit account opening solutions have joined our online nCino Community. In the nCino Community, users can access product guides and technical documents, engage and share best practices with other users and nCino subject matter experts through various discussion groups, suggest and vote for future product development ideas, and access training videos, materials and product certifications. Research and Development Our research and development organization is responsible for the design, development, engineering, and testing of our solutions. We utilize industry best practices, such as continuous integration/continuous deployment, automated testing and distributed version control, to develop new functionality and enhance our existing solutions. We provide opportunities for innovation through hackathons and new technology pilots, and we encourage customers to participate in our Product Design Programs to provide us with input on our product development roadmap. Our research and development spend was $129.4 million or 23.9% of total revenues in fiscal 2025. Competition Historically, the primary competition for the nCino Platform has been point solution vendors and systems developed internally by FIs. We believe our ability to provide client onboarding, loan origination, deposit account opening, analytics, portfolio management, and AI on a platform across lines of business, our deep banking domain expertise, our mortgage suite, our reputation for high-quality professional services and customer support, and our strong company culture, distinguish us from our competition. We believe our success in growing our business will depend on our ability to demonstrate to FIs that our solutions provide superior business outcomes and value to those of competitors or internally developed systems. In this regard, we are likely to be assessed on a number of factors, including: • breadth and depth of functionality; • ease of deployment, implementation and use; • total cost of ownership and return on investment; • level of customer satisfaction; • brand awareness and reputation; • cloud-based technology platform, availability of AI capabilities, and pricing model; • quality of implementation and customer support services; • capability for configurability, integration, and scalability; • domain expertise in banking technology; • security and reliability; • ability of our solutions to support compliance with legal and regulatory requirements; • ability to innovate and respond to customer needs quickly; • ability to provide data connectivity and integrate with third-party applications and systems; and 5 Table of Contents • insights and benchmarking derived from the cross-institution data and transactions that flow through our platform. We believe we compete favorably with respect to these factors, but we expect competition to increase as existing competitors evolve their offerings and as new companies enter the market. Our ability to remain competitive will depend on our ongoing efforts in research and development, sales and marketing, professional services, customer support, and our business operations generally. For additional information, see Part I, Item 1A of this Annual Report on Form 10-K, “Risk Factors—The markets in which we participate are intensely competitive and highly fragmented, and pricing pressure, new technologies or other competitive dynamics could adversely affect our business and results of operations.” Intellectual Property Our success depends in part on our ability to protect our core technology and innovations. We rely on federal, state, common law, and international rights, as well as contractual restrictions, to protect our intellectual property. We control access to our proprietary technology by entering into confidentiality and invention assignment agreements with our employees and contractors, and confidentiality agreements with third parties. We seek patent protection for certain key innovations, protocols, processes, and other inventions. We pursue the registration of our trademarks, service marks, and domain names in the U.S. and in certain other locations. These laws, procedures and restrictions provide only limited protection and the legal standards relating to the validity, enforceability, and scope of protection of intellectual property rights are uncertain and still evolving. Furthermore, effective patent, trademark, copyright, and trade secret protection may not be available in every country in which our products are available. As of January 31, 2025, we had 12 issued patents relating to the nCino Platform in the U.S. We file patent applications where we believe there to be a strategic technological or business reason to do so. Although we actively attempt to utilize patents to protect our technologies, we believe that none of our patents, individually or in the aggregate, are material to our business. Human Capital Management nCino is in the business of helping FIs around the globe modernize their operations. To transform an industry, we believe our workplace culture is critical in fostering accountability and autonomy, enabling our employees to boldly innovate and deliver the best possible outcomes for our customers. Our culture delivers a differentiated employee value proposition that balances innovation, accountability, continuous learning, and career growth, underpinned by a foundation of six core values: Bring Your A-Game, Do the Right Thing, Respect Each Other, Make Someone’s Day, Have Fun and Be a Winner. Our unwavering commitment to our customers and employees is reflected across external measurements and outcomes, including numerous workplace awards as well as our Net Promoter Score commentary calling out our people and partnership. As of January 31, 2025, we had 1,833 employees, of which approximately 73% were in the U.S. and 27% were in other locations around the globe. We believe our employee engagement and experience remain strong. Employee Involvement As part of our priority to drive success through brand reputation and excellence, we listen to our employees and develop involvement programs that foster belonging and deliver value back to our communities. Powerful examples of this inclusive programming are nCino's Employee Resource Groups (“ERGs”), which are open to all nCino team members. These groups play an important role in building camaraderie among employees, providing resources to the broader nCino community, building nCino's reputation as an employer of choice for talent, while also creating opportunities for professional development and mentorship. nCino supports many causes and initiatives in the communities in which we operate. Combining corporate giving and matching along with employee giving, nCino has donated to numerous non-profits globally. With respect to philanthropic giving, the nCino community has broadly given back to various community groups, including those associated with STEM-focused education, social/community needs, environmental causes, and health research. Through nVolve, nCino's philanthropic and community service approach, we prioritize giving back to our communities by providing all employees paid volunteer days separate from regular leave or holidays to support organizations and causes that are important to them. 6 Table of Contents Total Rewards To ensure our ability to attract and retain the very best global talent, we offer market competitive compensation that is consistently evaluated, opportunities for equity ownership, savings options to help employees invest in their future, and generous, country-specific benefit packages. Technology, Development and Cloud Operations We deliver our solutions as secure, highly scalable cloud computing application and platform services with a multi-tenant technology and shared service-oriented architecture. Multi-tenancy is an architectural approach that allows us to operate a single application instance for multiple organizations, treating all customers as separate and virtual isolation from each other. Service-Oriented Architecture ("SOA") is a software design approach that builds applications from reusable, self-contained components called services, allowing them to communicate and interact across different platforms and technologies. This approach allows us to spread the cost of delivering our services across the globe and scale our business faster than traditional software vendors while focusing our resources on building new functionality and enhancing existing offerings. Our technology and product efforts are focused on improving and enhancing the features, functionality, performance, availability, and security of our existing service offerings, as well as developing new features, functionality, and services. We also remain focused on integrating businesses, services and technologies from acquisitions and with partners. Global Financial Service Providers Are Highly Regulated Global financial service providers and their solutions are subject to extensive and complex data, security, privacy, and regulatory oversight by international, country, federal, state and other regulatory authorities. These laws and regulations are constantly evolving and affect the conduct of financial service providers' operations and, as a result, the business of their technology providers. The compliance process with these regulatory requirements depends on a variety of factors, including functionality and design, the classification of the financial service provider and its services, region or country of operation, and the manner in which the financial service provider and its end users utilize the solutions. In order to ensure compliance with these laws, financial service providers may be required to implement operating policies, procedures, and controls to protect the privacy and security of their, the financial service providers', and their end users' information, and to undergo periodic audits and examinations. Security and Data Protection Is Paramount for Global Financial Service Providers The risks of cybercrime and fraud have always existed in banking and financial services. As the adoption and use of digital services increase in financial services, the incidence of cybercrime and fraud may grow substantially. The methods by which criminals seek to commit fraud are constantly changing, requiring financial services providers and their technology providers to continually modify their security protocols and best practices. Providing services to the financial services industry requires experience, constant vigilance, and continuous investment to stay informed and guard against these ever-changing threats. Available Information Our website is located at www.ncino.com and our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other filings with the Securities and Exchange Commission (“SEC”), and all amendments to these filings, can be obtained free of charge from our website as soon as reasonably practicable after we electronically file or furnish such materials with the SEC. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov. The contents of these websites are not incorporated into this filing. Further, the Company’s references to the URLs for these websites are intended to be inactive textual references only.