Life360, Inc. · NASDAQ:LIF
Life360 — H1 2020 Earnings Presentation
42 slides from Life360's earnings presentation, Aug 27, 2020
Slide 1: CY20 H1 Result Investor Presentation
. CY20 H1 Result © Investor Presentation 27 August 2020
Slide 2: Disclaimer
Disclaimer This document dated 27 August 2020 has been prepared by Life360, Inc. (ARBN 629 412 942) (Company) and is provided for information purposes only. It contains summary information about the Company and its activities and is current as at the date of this document. It should be read in conju
Slide 3: Agenda
Agenda 4 For personal use only Note : All references in this presentation to $ are to US$ Business and Strategy Overview Chris Hulls, Co-Founder and CEO Financial Overview Russell Burke, CFO Outlook Chri er and CEO @itesco CY20 Hi Results | August 2020 3.
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For personal use only
Slide 5: CY20 H1 Highlights
CY20 H1 Highlights Delivering on our strategy to build and monetise our user base $77.9m $38.7m +33% June 2020 Normalised CY20 H1 revenue* ARPPC** increase of first Annualised Monthly Revenue +57% YoY new Membership cohort post +26% YoY launch vs CY20 HI 845k $1.1m $0.7m +21% YoY Paying Circles Posi
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Direct Indirect 10.5 Other costs BR&D © Commissions © User Acquisition 4) 5.4 10.3 65 14, 19.2 “ 39 165 10.1 32 14.0 70 78 CY18 HI CY19 H1 CY20 H1 7.0 12.9 . CY18 HI CY19 H1 CY20 H1 -42 -41 Le 34 : 7 -16.5 1.65x 1.67% CY18 HI CY19 H1 CY20 H1 Bias Statutory EBITDA Underlying EBITDA excl. user acquisi
Slide 7: Growing revenue in midst of COVID-19 and improving margin profile
Growing revenue in midst of COVID-19 and improving margin profile QUARTERLY REVENUE* ($M) QUARTERLY EBITDA** MARGIN PROFILE (%) “Indirect Q117 G2 Q3_Q4 Q118 G2 Q3_Q4.Q119 G2 G3 G4 Qi Q2 vow 7 18 18 18 19 19 19 20 20 Underlying EBITDA 1Q16 2Q16 3Q16 4Q16 1G17 2QI7 3QI7 4QI7 1018 2Q18 3Q18 4Q18 1A19 2
Slide 8: International and US monthly active users
2,500,000 8.9 10.4 Other international : 2,000,000 markets 71 Thailand, Philippines, : 1,500,000 Indonesia, Turkey, 16.3 — Argentina, South Africa, 127 Russia, Vietnam. 77 1,000,000 India, Mexico, Brazil THI8. THI9 1H20 500,000 US miInternational 0 + International 1H 20 MAU declined 14% YoY and 17%
Slide 9: Revenue by region and type
US International 47 Indirect 3.5 23.5 61% 15.7 12% 2.0 US Direct 8.1 . International Direct CY18 HI CY19 H1 CY20 HI
Slide 10: Paying Circles and ARPPC
Driver Protect Life360 Plus Other 100 0+ 71.72 US =m international $70.27 § $64.28 $62.04 $58.90 $59.83 $51.35 $48.74 $46.52 $46.15 gaa 84201 878 $40.24 $39.99 $33.4) IH16. 2HI6«IHI7,- 2H17_sTHI8_— 2H18_—IHI9-_2HI9 * 21% YoY growth in Paying Circles to 845K + Impressive subscriber retention in the f
Slide 11: Resilient retention despite COVID-19 impact
Resilient retention despite COVID-19 impact * Charts indicate how long users within a given cohort remain with Life360 * COVID-19 had an initial negative impact on organic users followed by a “bump” of reactivations + User retention rates benefit from reactivation of previous users * Minimal impact
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mUS International 15 Indirect 61% 54 12% International P| Direct cyig Hi cyig HI CY20 HI US Direct
Slide 13: Data and lead generation indirect revenue
Data + Data revenue continued to deliver strong YoY growth reflecting Life360’s expanded reach + However COVID-19 is proving detrimental to certain data customers with slowdown expected in H2 Lead generation + Auto insurance lead generation with Allstate formally launched in May 2019 * Monthly contr
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Slide 15: Putting the "360" into the Life360 name
Putting the “360” into the Life360 name Scaling from location tracking app to suite of membership services 10m MAU Life360 Plus Driver Protect For personal use only Membership @uitesco CY20 HI Results | August 2020
Slide 16: Membership services across life stages
Membership allows us to offer services that hit > the emotional triggers of every life stage (= Location and Communication Crash and Roadside Assistance Identity Protection sos FOr persor: Disaster, Medical, and Travel Assistance Ongoing Features & Services (i.e. wearables, Life360 insurance offerin
Slide 17: Membership tiers
Basic Life360 Account Real-time Location Sharing 2 Place Alerts 2 days of Location History Unlimited Check-Ins Crash Detection Family Driving Summary SOS Alert Silver Make daily coordination a breeze 5 Place Alerts 7 days of Location History Crime Reports $100 Stolen Phone Coverage 8 Gold Protect yo
Slide 18: One month post full launch: subscriber mix
One month post full launch CY20 H1 July 14 to August 14, 2020 CY20 H2 pre-Membership (promotional pricing period*) expectations 94% 73% 65-70% (25% 16% 6% 360 Plus Driver Protect Silver ™Gold Platinum Silver ™Gold Platinum + Prior to Membership launch, new subscribers + New Membership subscriber mix
Slide 19: For personal use only
For personal use only Sep-16 Mar-17. Jun-17_ Dec-17_ Jun-18 Dec-18 = Jun-19- Dec-19- Jun-20 "Driver Protect» 360 Plus®
Slide 20: One month post full launch: subscriber base
One month post full launch CcY20 H1 December 202 pre-Membership July 14 to August 14, 2020 sce! mber 2020 (promotional pricing period*) P 155 72% 57-60% 24% 22% 18-20% 360 Plus.» Driver Protect Plus legacy © DP legacy Membership Plus legacy = DP legacy @ Membership + In CY20 Hi Driver Protect made u
Slide 21: Significant gains in US ARPPC for new cohorts
Membership offering Significant gains in US ARPPC for new cohorts CY20 HT One month post full launch CY20 H2 pre-Membership July 14 to August 14, 2020 expectations (promotional pricing period*) ate $86.70 ~$115 $110-$115 +33% vs H1 20 +~30% vs 1H 20 et $71.72 . $76-$78 base +~7% vs 1H 20 * Ends 9 Se
Slide 22: Post-COVID Strategy and Membership Next Steps
Post-COVID Strategy and Membership Next Steps Life360 is well positioned to return to accelerating growth in the post-COVID world Adapt Build new marketing channels to drive growth when operating environment returns to normal Invest Leverage strong Membership launch by bringing forward R&D investmen
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Slide 24: Invest: Membership Launch Status
Invest Membership Launch Status We're accelerating Membership due to the successful results of the launch Live Now (key features only) SOS + Early indicators show Membership outperforming Premium Identity Theft and R&D efforts will be increased Family Safety Assist : _ : Enhanced Roadside Assistance
Slide 25: Evolve: adapting roadmap for post-COVID world
Life360 Pre-COVID Life360 Post-COVID Evolve Where are you? How are you? Adapting Life360’s roadmap for the post-COVID world COVID is driving the rapid acceleration of all digital communication trends, allowing the speeding up of Life360’s long-planned evolution from “Where are you?” to “How are you?
Slide 26: Brand and marketing adapted to the new environment
Brand and marketing has been ° TikTok C Stud adapted to the new environment _— Objective: Address teens on TikTok A Q 9 q who had organised 1 star campaign Expanding Life360’s audience reach and attacking Life360 developing new channels : : : - Strategy: Prioritise building features + Now targeting
Slide 27: Financial Overview
Financial Overview $ For personal use only @itesco CY20 HI Results | August 2020 27
Slide 28: Unit Economics: net revenue retention
Unit Economics Net revenue retention is significantly higher than subscriber retention * Revenue retention compares 1Q18 USER COHORT REVENUE! VS SUBSCRIBER RETENTION? TERELTEL 8 COMETIMTEY SSIES [SEG * Net revenue retention is significantly higher than subscriber retention due to: -.—_ o Increases i
Slide 29: Unit Economics: cohort cumulative revenue
Unit Economics Increasing revenue per user cohort reflects earlier monetisation of new users and upsell over time Q1USER COHORT CUMULATIVE REVENUE* ($M) Q2 USER COHORT CUMULATIVE REVENUE ($M) 2 © 2 8 8 S 6 6 4 4 = 2 2 @ , —108 ——1019 1020 , —$207_ 2018 —— 2019 = OM 3M 6M 9M 12M 15M 18M 2IM 24M 27M S
Slide 30: Unit Economics: Driver Protect take-up and ARPPC
For personal use only Unit Economics Increased take-up of Driver Protect has underpinned increased ARPPC per user cohort DRIVER PROTECT* % OF SUBSCRIBER COHORT 40% 30% 20% OM 3M 6M 9M 12M 15M 18M 2IM 24M 27M 30M 33M 36M 2Q17 3Q17 4017 1018 2Q18 1a19 2a19 3Q19 4ai9 3Q18 me 4Q18 1020 <== 2020 *Driver
Slide 31: Unit Economics: cohort contribution margin
For personal use only Unit Economics Increasing contribution margin driven by conversion of free users to subscribers over time Q1USER COHORT CUMULATIVE 7 CONTRIBUTION MARGIN * $M 1018 1a19 1020 OM 3M 6M 9M 12M 15M 18M 2IM 24M 27M Q3 USER COHORT CUMULATIVE 7 CONTRIBUTION MARGIN $M 3018 ee 319 OM 3M
Slide 32: Unit Economics: marketing payback
Unit Economics Our investment across all marketing channels shows a strong overall return * Blended summary provides performance insight into MARKETING PAYBACK* ($M) overall efforts across all channels in aggregate * Robust and consistent long-term returns reflect Life360’s strong growth engine * Mo
Slide 33: Membership subscription contribution margin expectations
For personal use only Unit Economics Membership model subscription contribution margin expectations Membership $110-115! 85-90% ~$98 US Legacy $72 85-90% ~$63 International $51 90-95% ~$47 Cost of serving free users - ~(18-20)% Gross margin? 65-70% Commissions 25% - Contribution margin* 40-45% - + E
Slide 34: Income Statement
Income Statement U.S, revenue Direct 15.7 22.7 44% Indirect 5.4 9.0 65% International revenue Direct 3.5 46 34% Indirect 0.0 15 NM Totalrevenue 8B BAH Customer support (0.9) (1.5) (63)% Research and Development (14.0) (16.5) (17)% User acquisition (10.3) (4.1) 60% Sales and marketing (5.7) (9.6) (70
Slide 35: Balance Sheet
Balance Sheet $M Cash and cash equivalents Accounts receivable Costs capitalised to obtain revenue contracts, net Prepaid expenses and other current assets Total current assets Property and equipment, net Costs capitalised to obtain revenue contracts, net of current portion Intangible assets, net Ot
Slide 36: Commentary: cash flow
Commentary Net cash outflows from operating activities reduced by $11.2m acquisition spend undertaken in response to the COVID19 Statutory EBITDA (pre user acquisition) (6.2) (3.0) environment User acquisition costs (10.3) (4.1) 5 ‘Net cash outflows from investing activities reflects minor tatutory
Slide 37: Outlook
Outlook Ajuo asn peuosied 104 ey
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CY20 Hi Results | August 2020 39
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CY20 Hi Results | August 2020 40
Slide 41: Operating Metrics
1. Operating Metrics CYI8H1 CYI9HI CY20HI1 cY17 cyi8 cy19} 77 12.7 16.3 57 10.0 16.3 International 71 10.4 9.0 54 85 10.9 Total 14.8 23.1 25.2 lS 72 Paying Circles (millions) US. 0.33 0.53 0.67 022 045 0.64 International 0.10 0.16 0.17 0.07 0.13 0.19 Total 0.43 0.69 0.84 0.29 0.58 0.83 Direct ARPPC
Slide 42: Competitive Landscape
2. Competitive Landscape Membership Services For personal use only Total Cost* $256.34/month “Assuming family household of four people. Prices may vary. Y Roadside Assistance ID Theft Protection \ Nurse Helpline Crash Detection Travel Assistance v v \ SOS Alert \ Disaster Assistance \ Driver Reports