Q2 2015
Safe Harbor Statement
This presentation contains forward-looking statements. All statements other than statements of historical facts contained in this
presentation, including statements regarding future results of the operations and financial position of Opower, Inc. ( Opower or the
Company ), including financial targets, business strategy, and plans and objectives for future operations, are forward-looking
statements. Opower has based these forward-looking statements largely on its estimates of its financial results and its current
expectations and projections about future events and financial trends that it believes may affect its financial condition, results of
operations, business strategy, short-term and long-term business operations and objectives, and financial needs as of the date of
this presentation. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those
described under the heading Risk Factors in Opower’s Annual Report on Form 10-K filed with the Securities and Exchange
Commission (the SEC ). Moreover, Opower operates in a very competitive and rapidly changing environment. New risks emerge
from time to time. It is not possible for Opower s management to predict all risks, nor can Opower assess the impact of all factors on
its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements Opower may make. In light of these risks, uncertainties and assumptions, the forwardlooking events and circumstances discussed in this presentation may not occur and actual results could differ materially and
adversely from those anticipated or implied in the forward-looking statements.
You should not rely upon forward-looking statements as predictions of future events. Although Opower believes that the
expectations reflected in the forward-looking statements are reasonable, Opower cannot guarantee that the future results, levels of
activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover,
neither Opower nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements.
Except as required by law, Opower undertakes no obligation to update publicly any forward-looking statements for any reason after
the date of this presentation, to conform these statements to actual results or to changes in Opower s expectations.
In addition to U.S. GAAP financials, this presentation includes certain non-GAAP financial measures. These non-GAAP measures are
in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with U.S. GAAP. A
reconciliation of non-GAAP measures to GAAP measures is contained in the Appendix.
2
Opower’s Market Opportunity
M A R K E T $2.2 trillion utility industry in an era of rapid change
P R O D U C T Customer engagement platform for utilities
C U S TO M E R S 98 utilities worldwide, reaching 50+ million consumers
Expansion potential 1200 potential utility customers worldwide
B U S I N E S S Market size
710 million potential homes and businesses
Accelerating lead
Scale of data set, platform sophistication
Visibility
90% recurring revenue
Note: 710M poten-al end-‐users comprised of 650M households and 60M businesses. Customer count as of 12/31/14. 3
Industry Change Puts Focus on Customers
COMPETITION
REGULATION
REDUCE COST
BUILD LOYALTY
MANAGE DEMAND
New Priorities
New Problems
FLAT DEMAND
4 Customer Expectation vs. Utility Reality
CUSTOMER
EXPECTATION
UTILITY
REALITY
Call Center
CIS
Bill Printing
Paper Delivery
5 Customer Engagement Platform
CUSTOMER
DISTRIBUTION
INDICATIVE ROADMAP
ENERGY
EFFICIENCY
DEMAND
RESPONSE
BILLING
SUITE
CUSTOMER
LIFECYCLE
CUSTOMER
RETENTION
OUTAGE
CALL
CENTER
A U T O M AT I O N
SCADA
(Segmentation, Targeting, Delivery)
A N A LY T I C S
ANALYTICS
DMS DIGITAL
ENGAGEMENT
Outage Management Call Center Meter Data Customer Care & Billing Data Warehouse
Smart Meters
6
Opower Solution Set
DEMAND MANAGEMENT
CUSTOMER CARE
ENERGY
EFFICIENCY
DEMAND
RESPONSE
Email and paper energy
reports. Integrated campaign
tools. Product marketplace.
Pre- and post-event alerts
via email, SMS and IVR.
Web tools. Seasonal reports.
Web and mobile tools to
understand energy usage.
Energy savings tips.
Call center advisor tools. Ebill
presentment with analytics.
Web tools for bill analysis.
KEY VALUE
Compliance with mandated
energy efficiency
Territory-wide demand
response with no hardware
Increased customer
engagement and satisfaction
Enhanced experience with
reduced cost to serve
LAUNCHED 2008 2013 2011 2015 15+ million
1+ million
50+ million
1+ million
DESCRIPTION ENDPOINTS DIGITAL
ENGAGEMENT
BILLING
SUITE
7
Unique in the Competitive Landscape
Traditional ERP
•  Core ERP solution not designed for digital engagement
•  Industry-specific offerings cobbled together via acquisition
•  Years to deploy, with great risk of implementation failure
Point Solutions
•  EnerNOC: Demand response for commercial and industrial
•  C3: Grid analytics and theft detection
•  Tendril: Efficiency for one large client
Smart Meter
Customer Engagement
•  Upstream providers of data
•  Some analytics and customer engagement
•  Purpose built to serve utilities with an integrated suite
•  Automating the customer experience
•  Unique expertise in analytics and behavioral science
8 Energy Efficiency is Cost Neutral for Utilities
Lost Revenue Adjustment Mechanism (LRAM) applied to a sample $10 million Opower program
Opower costs $10M and delivers $25M customer savings
Without regulations, this would impact the utility bottom line.
1
$10M
$25M reduced revenue
Opower
program cost
Customer
savings
LRAM permits the utility to recover program costs and lost earnings
Rate increase raises utility revenue by $12.5M. Typical utility earnings are 10% or less of revenue.
2
$10M
$2.5M
Opower
program cost
10% of
revenue
Utility is made whole, customers still save
3
$12.5M
Rate increase recovers
Opower cost + lost earnings
$12.5M
Remaining customer
savings post-rate increase
9
Customer Care Produces Measurable Results
Customer satisfaction 5% increase in customer satisfaction
and brand recognition
Cross Selling Products and Services 60% increase in program and service
promotion effectiveness
Call center volume 19% decrease in high bill calls during
months with highest call volume
Results measured by multiple live Opower clients.
10 Technology Lead & Data Advantage
MORE DATA
MORE INSIGHT
MORE TECH
434B
308B
201B
52B
2010
111B
2011
2012
2013
2014
cumulative meter reads
400+ BILLION
PROPRIETARY
meter reads, largest
data set of its kind
algorithms based on
multiple data sources
150+ MILLION
180+ MILLION
energy consumers analyzed
personalized touch points
400+
70+
Person years of big data
software development
Utility websites on
one code base
11 Expansion Across Product Lines
Entry Point
2014
+
EAST
COAST
UTILITY
$0.5M
2009
Energy
Efficiency
Efficiency
Expansion
Digital
Engagement
2013 $16.2M
$12.0M
2014
2013
$12.8M
$10.0M
2014
2013
$7.1M
$6.2M
Energy
Efficiency
WEST
COAST
UTILITY
$2.0M
2010
Digital
Engagement
Digital
Engagement Demand
Response
+
EAST
COAST
UTILITY
$0.3M
2010
Energy
Efficiency Efficiency
Expansion
Digital
Engagement
2014
2013
Demand
Response
12 Hundreds of Millions of Untapped Consumers
710 MILLION ADDRESSABLE
HOMES AND BUSINESSES
SOLUTION ENDPOINTS Digital
Engagement
+50M
Energy
Efficiency
+15M
Billing
Suite
+1M
Demand
Response
+1M
>100M HOMES SERVED
BY OUR CUSTOMERS
Note: Figures provided refer to end-users under contract as of 12/31/14.
13
Total Addressable Market
$11B opportunity
DEMAND
RESPONSE
22%
49%
CUSTOMER
CARE
ENERGY
EFFICIENCY
29%
Note: Based on Opower estimates.
14
Our Customers are Global Leaders
EUROPE
US INVESTOR-OWNED
ASIA/PACIFIC
CANADA
US MUNI/CO-OP
4 continents
98 utilities
28 of the 50 largest in the US - 3 of the 10 largest in the world
Note: Customer count as of 12/31/14. 15
Recurring Revenue Growth
$128M
90% of revenue is recurring
Non
Recurring
~90% 12-‐month forward revenue visibility 100% organic growth $89M
Recurring
$52M
$29M
$11M
2010
2011
2012
2013
2014
16 Backlog Provides Revenue Coverage
$244 million total backlog
As of December 2014
Deferred Revenue
Contracted But Unbilled Backlog
$64 Million
$180 Million
26 month weighted average contract length in 2014
17 Long Term Financial Targets
Non-GAAP
Excludes Stock Based
Compensation
2011
2012
2013
2014
Q1 2015
Long-term
targets
Gross Margin
48%
62%
64%
67%
65%
68 - 72%
S&M
51%
42%
36%
41%
38%
24 - 28%
R&D
53%
34%
32%
31%
32%
16 - 18%
G&A
14%
8%
8%
10%
11%
8 - 10%
(69%)
(18%)
(7%)
(10%)
(7%)
20 - 24%
Adjusted EBITDA
Notes: During the first quarter of 2014, the Company updated its methodology for allocating certain general and administrative costs to more closely align these costs
to the functional departments consuming the related services. Percentages above reflect the new methodology. Expenses include allocations of Depreciation and
Amortization including capitalized software. D&A was 2.2%, 3.1%, 4.2% and 5.6% in 2011-2014 and is expected to be 3-5% of revenue long term.
18 APPENDIX
OPOWER CONFIDENTIAL: DO NOT DISTRIBUTE
Energy Efficiency
Multi-channel outreach
Scaled energy savings
National Grid MA residential electricity savings
Opower savings
45%
26%
2014
2010
26 GWh
Opower savings
92 GWh
Opower savings
“We needed a next generation efficiency solution that enhanced
the customer experience and scaled as big as we wanted.
Opower was the clear choice.”
Jim Madej, Chief Customer Officer
20 Demand Response
Zero hardware approach
Peak reduction territory-wide
“Achieving peak reduction without hardware has been essential
to our smart meter rate case. Opower is a foundational partner
in that effort.”
Chris Burton, Vice President Smart Grid & Technology
21
Digital Engagement
Enriched web and mobile
Increased web visits
3.7M
WEB VISITS
2.4M
Business As Usual
5 weeks post-Opower
Launch
“We have a great relationship with Opower that’s really starting
to create engagement and reasons for customers to connect
with us.”
Anthony Ainsworth, Sales and Marketing Director
22 Billing Suite
Transforming the utility bill experience
Increased customer satisfaction
72%
55%
58%
46%
68%
73%
61%
51%
My utility wants to My utility wants to
My utility is a
My utility helps me
help me save money help me reduce my trustworthy source manage my monthly
home energy use
of information on
energy usage
energy efficiency
Control Group
Opower Treatment
Source: Opower Custer Engagement Tracker
“We have worked with Opower since 2008 to meet our energy
efficiency goals. We are excited to extend our partnership to
inject personalized insights into other touch points.”
Jason Teller, Vice President, Customer Solutions
23 Appendix A: Reconciliation of Adjusted EBITDA
$ Millions
2011
2012
2013
2014
Q1 2015
($21.3)
($12.3)
($14.2)
($42.0)
$(11.0)
Provision for Income Taxes
$0.0
$0.0
$0.0
$0.0
$0.1
Other (Income) Expense,
Including Interest
$0.0
($0.1)
$0.3
$1.0
$1.0
Depreciation and Amortization
$0.6
$1.6
$3.8
$7.2
$2.5
Stock-Based Compensation
$1.0
$1.2
$3.6
$20.4
$5.0
Adjusted EBITDA
($19.7)
($9.5)
($6.4)
($13.2)
$(2.4)
Adjusted EBITDA,
Percentage of Revenue
(69%)
(18%)
(7%)
(10%)
(7%)
Net Income (Loss)
Note: During the first quarter of 2014, the Company updated its methodology for allocating certain general and administrative costs to more
closely align these costs to the functional departments consuming the related services. The table above reflects the new methodology.
24 Appendix B: Reconciliation of Non-GAAP Information
$ THOUSANDS
2011
Gross profit, as reported
Add back: Stock-based compensation
Gross profit, non-GAAP
Gross margin, non-GAAP
2012
2013
2014
Q1 2015
$13,571 $32,176 $56,611 $84,314 $21,407
121 144 204 1,354 412
$13,692 $32,320 $56,815 $85,668 $21,819
48% 62% 64% 67% 65%
Sales and marketing, as reported
$14,986 $22,458 $33,116 $61,267 $14,501
Less: Stock-based compensation
341 527 1,487 1,888
$14,645 $21,931 $31,629 8,932 $52,335 $12,613
51% 42% 36% 41% 38%
Sales and marketing, non-GAAP
As percentage of revenue, non-GAAP
Research and development, as reported
Less: Stock-based compensation
Research and development, non-GAAP
As percentage of revenue, non-GAAP
General and administrative, as reported
Less: Stock-based compensation
General and administrative, non-GAAP
As percentage of revenue, non-GAAP
$15,723 $18,006 $29,496 $45,999 $12,213
368 468 960 5,623 1,658
$15,355 $17,538 $28,536 $10,555
53% 34% 32% $40,376 31% 32%
$4,139 $4,071 $7,816 $17,844 $4,575
130 48 974 1,046
$4,009 $4,023 $6,842 14% 8% 8% 4,473
$13,371 10%
$3,529
11%
Note: During the first quarter of 2014, the Company updated its methodology for allocating certain general and administrative costs to more
closely align these costs to the functional departments consuming the related services. The table above reflects the new methodology.
25