Slide 1: Skillz
skillz
Slide 2: Disclaimer
Disclaimer This investor presentation (“Investor Presentation”) is for informational purposes and does not constitute an offer to sell, a s olicitation of an offer to buy, or a recommendation to purchase any equity, debt or other financial instruments of Skillz Inc . ( “Skillz” or the “Company”) or
Slide 3: Disclaimer (cont)
Disclaimer (cont) Projections This Investor Presentation contains projected financial information with respect to Skillz, including Skillz’s projected GMV, Ta ke Rate, Revenue, Gross Profit, Contribution and EBITDA for 2020 - 2022. Such projected financial information constitutes forward - looking i
Slide 4: The Future of Entertainment
The Future of Entertainment Investor Presentation September 2020
Slide 5: Developers share their art; gamers connect through competition
5 Developers to share their art with the world Gamers to connect through meaningful competition
Slide 6: $1.6B Gross Marketplace Volume, 2B tournaments per year
6 $1.6B Gross Marketplace Volume (GMV) 2B tournaments per year
Slide 7: We built something gamers don't just like, they skillz
WE BUILT SOMETHING GAMERS DON'T JUST LIKE, THEY skillz
Slide 8: Fulfilling a human desire for community and competition
8 Fulfilling a human desire for community and competition 62 52 41 40 37 28 17 Minutes Per User Per Day Generating 70% more engagement than the #1 mobile game Mobile Gaming Average Note: Based on Skillz Data for calendar year 2019 and publicly available information.
Slide 9: We've redesigned mobile gaming to bring developers and gamers together
WE'VE REDESIGNED MOBILE GAMING TO BRING DEVELOPERS AND GAMERS TOGETHER More engagement = more revenue Gamers SkillZ —&_-Developers More content = more engagement skillz
Slide 10: Best-in-class results and recognition
10 $225M ‘20E Revenue 88% ’19 - '20E growth rate 4.7x 3 - Yr LTV / UAC 4 mos. Payback Period Best - in - class results and recognition
Slide 11: Skillz makes gaming better for everyone
Skillz makes gaming better for everyone with a proprietary, highly scalable SOFTWARE PLATFORM skillz
Slide 12: Comprehensive Technology Platform
12 Comprehensive Technology Platform Gamer competition engine Live ops system Developer console Network data science technologies
Slide 13: Gaming Platform Key Features
13 Gaming Platform Player rating and matching Anti - cheat & anti - fraud Social features Loyalty rewards Payments Content discovery 24/7 support Tournaments and leagues Key Features
Slide 14: The mobile gaming market is the future of entertainment
14 The mobile gaming market is the future of entertainment
Slide 15: Gaming has eclipsed movies, music, and books
MOVIES $43B $57B MUSIC $123B BOOKS $149B GAMING Gaming has eclipsed movies, music, and books 15 Source: Newzoo, PWC, Grandview Research. Note: OTT = “over the top” (i.e. streaming media offered directly to viewers via the internet. Movies = Global Film Box Office. $294B TELEVISION '14 - '19 CAGR 6%
Slide 16: Anyone can embrace their inner champion
ANYONE CAN EMBRACE THEIR INNER CHAMPION skillz
Slide 17: Our demographic is the mass market
17 Our demographic is the mass market Income <$25k $25K – $50K $50K – $75K $75K – $100K $100K – $150K $150K+ 10% 33% 30% 11% 9% 7% Age 18 – 25 26 – 35 36 – 45 46 – 55 66+ 10% 22% 23% 23% 15% 15% 56 – 65 Gender 57% 43% Female Male Source: Income and Age demographics from Axciom survey data of paying
Slide 18: Gamer you lose, gamer you win!
18 GAMER 2 YOU LOSE GAMER 1 YOU WIN!
Slide 19: Charity events raised more than Komen expected
19 23% More Raised by Skillz than Komen expected 25K+ New non - profit donors across 10 events K 0 18 # of Skillz Charity Donors Age
Slide 20: Growth in game developers
20 30,000 (2009) Game Developers 10 million (today) Game Developers More game developers equals
Slide 21: The old business models don't work anymore
THE OLD BUSINESS MODELS DON'T WORK ANYMORE skillz
Slide 22: The old business models
22 The old business models Ads interrupt gameplay In - game purchases lock users out of content (“pay to win”)
Slide 23: Explosion in game content makes it hard to get discovered
$21.00 $4.85 $0.25 #1 #1,000,000 23 Explosion in game content makes it hard to get discovered Revenue Per Install (RPI) for the best iOS game in the world: $21 GAME RANK BY REVENUE PER INSTALL Avg. Cost Per Install (CPI): $4.85 (2019) Avg. Cost Per Install (CPI): $0.25 (2014) Source: App Annie and L
Slide 24: We are redefining entertainment
24 We are redefining entertainment
Slide 25: What gamers and developers value vs. old models
25 Gamers Developers WHAT THEY VALUE Community Fun Discovery Monetization WHAT OLD MODELS DELIVER Interruption Pay to win Broken economics Gimmicks
Slide 26: How Skillz delivers
26 Gamers Developers HOW SKILLZ DELIVERS Meaningful connection Fair competition Network exposure Financial Success WHAT THEY VALUE Community Fun Discovery Monetization
Slide 27: Developer Solutions
27 Developer Solutions Anti - fraud and payments Customer support Game launch optimization Prize fulfillment Event ops Marketing - as - a - service Managed server hosting Analytics
Slide 28: Live Operations and superior monetization
28 Live Operations Key Features Multi - variate testing Cross - application personalization Charity events Player incentive optimization Brand - sponsored tournaments Lifecycle engagement marketing SUPERIOR MONETIZATION $6.30 $1.70 $0.00 $2.00 $4.00 $6.00 $8.00 Skillz ZNGA & GLUU Average ARPU (2019)
Slide 29: Our platform is underpinned by data science
29 Our platform is underpinned by data science Anti - cheat and anti - fraud Player rating and matching Algorithmic skill vs. chance testing Segmentation engine
Slide 30: Developers can make a living doing what they love
DEVELOPERS CAN MAKE A LIVING DOING WHAT THEY LOVE skillz
Slide 31: Games exceeding $1M annualized GMV
7 10 15 23 34 2016 2017 2018 2019 1H'20 # of games >$1M annualized GMV 31 2016 2017 2018 2019 #1 #2 #3 #4 #5 1H’20
Slide 32: With compelling economics
32 with compelling economics
Slide 33: Generating profitable growth with capital efficiency
33 Generating profitable growth with capital efficiency $.B $1.B $2.B $3.B $4.B 2016 2017 2018 2019 2020E 2021E 2022E $104M Total Capital Invested* $132M Cash + Undrawn Debt* $3.8B GMV $555M Revenue $.B $.1B $.2B $.4B $.5B $.6B 2016 2018 2020E 2022E * As of June 30, 2020. Undrawn debt based on $30M
Slide 34: Robust opportunities to invest in growth
Grow ARPU New Monetization Robust opportunities to invest in growth 34 1.5% share Monthly Gamers x Skillz ARPU iOS Market Opportunity: $8B + Android TAM: $15B + New Genres TAM: $24B + International TAM: $125B+ Go Global Expand Content Unique Distribution Note: TAM = Total Addressable Market.
Slide 35: Proposed Transaction Summary
Proposed Transaction Summary ■ Flying Eagle Acquisition Corp. (“FEAC”) is a publicly listed special purpose acquisition company with over $690 million of cash in trust ■ FEAC has agreed to combine with Skillz based on a $3.5 billion pre - money equity value ■ Historical annual revenue growth of over
Slide 36: Appendix: comparable companies benchmarking
36 Appendix: comparable companies benchmarking Note: Factset, Company Filings, Thomson, Market Data as of July 28, 2020. “EV” means Enterprise Value. 1 Skillz implied multiples based on a $3.5Bn pre - money equity value 57% 45% 40% 38% 35% 35% 33% 28% 24% 21% 19% 18% 0% 30% 60% Skillz DraftKings Sho
Slide 37: Appendix: comparable companies benchmarking
37 Appendix: comparable companies benchmarking Note: Factset, Company Filings, Thomson, Market Data as of July 28, 2020; *Shopify multiples excluded from average; Revenue M ult iple (Growth Adj.) calculated by (Revenue Multiple)/(2020E – 2022E Revenue CAGR*100); NM means multiple >50x or <0x 1 Skill
Slide 38: Appendix: P&L Summary
38 Appendix: P&L Summary GMV Take Rate Revenue Gross Profit Contribution Adj. EBITDA 2017 $120 14% $17 $16 - $3 - $10 $3,790 15% $555 $534 $245 $8 2022E 2018 $365 14% $51 $49 $6 - $18 2019 $886 14% $120 $114 $29 - $23 2020E $1,566 14% $225 $216 $82 - $47 2021E $2,519 15% $366 $352 $156 - $14 ($ in M
Slide 39: Appendix: Continued momentum in 1H 2020
39 Appendix: Continued momentum in 1h 2020 With attractive revenue growth (1) Monthly Active Users refers to the number of end - users who entered into a contest on our platform at least once in a given m onth, averaged over each month in the quarter. (2) Average Revenue Per Monthly Active User (“AR
Slide 40: Appendix: Long Term Model
40 GMV Take Rate Revenue Gross Margin Adj. EBITDA Margin TODAY 100% 14% 100% 95% - 20% 100% 20% 100% 95% 30% LONG TERM Appendix: Long Term Model
Slide 41: Appendix: Skill vs. chance games
Appendix: Skill vs. chance games 41 Skillz uses a patented Skill Classification Algorithm to determine skill of video game Skillz Patent: US 8882576 B1 • Authored by Dr. Peter Winkler: Professor of Math, Statistics, and Computer Science at Dartmouth • Classifies a game as a game of skill or a game o
Slide 42: Skillz
skillz