Slide 1: Cellebrite Analyst Day June 2021
£::° Cellebrite Analyst Day June 2021
Slide 2: Team and presenters
Team and presenters Founding Partner of True Wind Capital. Former Founder and Head of KKR Global Technology Group Board experience includes LPRO, AVGO, GDDY, NXPI, JAZZ, AEPI, MDTH, EK and many private companies Holds an MBA from Harvard Business School Partner at True Wind Capital. Former investmen
Slide 3: Email your questions
mark@blueshirtgroup.com or anateh@cellebrite.com Email your questions:
Slide 4: Disclaimer
Dis c laimer This presentation (“Presentation”) contains proprietary and confidential information of Cellebrite DI Ltd. (“Cellebrite” or the “Company”) and TWC Tech Holdings II Corp. (“TWC II”) and the entire contents should be considered “Confidential Information.” This Presentation is made solely
Slide 5: Disclaimer: Use of Non-GAAP Financial Measures
Dis c laimer U s e o f N on - G AA P F i nan ci a l M ea s u r e s This Presentation includes non - GAAP financial measures. TWC II and Cellebrite believe that these non - GAAP measures are useful to investors for two principal reasons. First, they believe these measures may assist investors in comp
Slide 6: Investment highlights
Investment highlights Cellebrite is the clear market leader with 99% win rate within digital intelligence Massive $12B+ market opportunity for digital intelligence (“DI”) solutions with major secular tailwinds supporting continued growth Unique mission critical end - to - end digital intelligence pl
Slide 7: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview A pp e n d i x Table of contents 1 2 3 4 5 6
Slide 8: Our mission is to protect and save lives, accelerate justice and preserve privacy
Our mission is to protect and save lives, accelerate justice and preserve privacy in global communities
Slide 9: Cellebrite by the numbers
Top research team built from elite Israeli intelligence units 6,700 customers across federal, state, local and enterprise High visibility recurring revenue business model with best - in - class growth and margin profile Technology makes data accessible, digestible and actionable Undisputed leader in
Slide 10: Cellebrite empowers the world's leading government agencies and enterprises
Cellebrite empowers the world’s leading government agencies and enterprises Fe d e r a l State & Local Enterprise 9 of Top 10 A cc o u n t i n g F i rms 6 of Top 10 P h a rma Com pa n i es 8 of Top 10 U.S. Comme r cia l Ba n k s 5 of Top 10 Auto Ma n ufac t u rers 6 of Top 10 P etro l e u m Re fi n
Slide 11: Investigations today are manual, slow, and siloed
Investigations today are manual, slow, and siloed Backlog Manua l review o f d a t a Initial h a n d l ing Rely on a few overwhelmed people, with limited tech, to u n c o ver insig h t s Siloed task forces Slow, manual Error prone Data loss due to miscommunication Slow and cumbersome first responses
Slide 12: Cellebrite delivers a comprehensive DI software platform
Cellebrite delivers a comprehensive DI software platform DI PLATFORM DATA SOURCES P ro se c u t o r s Agency M a n ag eme n t Lab P ra c titi on e rs I n vesti g a t o r s & Analysts OUTCOMES Accelerated i n ve s t ig at i on s DATA TYPES Empowering Chiefs of Investigations & Intelligence with end -
Slide 13: Collect & Review solution overview
Collect & Review solution overview Value Proposition: Capture critical investigative data from digital sources Key Benefits Deep & thorough extraction of evidentiary data Broadest range of device & profile support Unsurpassed decoding Powerful review Key Functions Extract, decode and review data fro
Slide 14: Analyze solution overview
Analyze solution overview Value Proposition: Automates and accelerates analysis of investigative data and the delivery of insights Key Functions AI - based investigative analytics solutions help investigative teams fuse and enrich data: Enables seamless automation of analysis Accelerates data manage
Slide 15: Manage solution overview
Manage solution overview Value Proposition: Provides orchestration of investigative workflows Key Benefits Saves time and cuts operational costs Provides operational visibility & control Key Functions Manage deployment & utilization of solutions Define and enforce permissions & access control Store
Slide 16: A platform for delivering social good
A platform for delivering social good Corporate policies & governance • Monitoring and policy administration conducted by in - house compliance and outside counsel • Board - level oversight by ethics committee • Prioritize a human - rights based approach Built - in technology controls • Platform des
Slide 17: Product Demo
iY Cellebrite Product Demo
Slide 18: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview A pp e n d i x 1 2 3 4 5 6 Table of contents
Slide 19: Digital evidence is rapidly proliferating
Digital evidence is rapidly proliferating The " explosion " in digital evidence is driven by: Growth in the volume of digital devices Growth in the amount of data per device Growth in number of exhibits per case A suspect may have 8 smartphones around the house, sometimes the investigators collect s
Slide 20: Digital evidence plays a critical role in the judicial system
Digital evidence plays a critical role in the judicial system Digital transformation in public safety is complex and leads to resources / capabilities being pushed to the field Transformation starts at large agencies and gradually expands towards medium and small agencies We use UFED in 100% of our
Slide 21: Public safety's digital transformation will drive growth across our solutions
Public safety’s digital transformation will drive meaningful growth across our suite of solutions Proliferation of digital sources Exponential growth in data volume Increased difficulty to access data Complexity and variety of data sources Complexity of investigations creates need for digital collab
Slide 22: Massive digital intelligence market – $12B+ TAM in 2023
Massive digital intelligence market – $12B+ TAM in 2023 $2. 7 B $0.8B $ 1 . 7 B $ 1 .6B $ 1 2. 3 B TAM by Domain $5.5B Collection & Investigative Management Review Analytics Services eDiscovery & CI 1 T AM USD N um b er of agencies Avg. spend p er a g e n cy 2 Federal $4.7B State & Local $6.0B TAM b
Slide 23: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview A pp e n d i x 1 2 3 4 5 6 Table of contents
Slide 24: Significant near-term growth opportunity
Significant near - term growth opportunity 5x 1 increase in spend on in - house discovery and investigations M &A Targeted, di s c ip l in e d approach Private sector growth New and e x t e n d e d offering Premiu m Enterprise Cloud & SaaS Remote collection New buying centers within existing logos N
Slide 25: Cellebrite is the clear market leader
Cellebrite is the clear market leader Industry standard in digital investigations 90%+ of relevant public safety agencies are customers Significant growth opportunity into existing base 99% Win Rate 1 145%+ ARR Net Retention 3 Sticky solution with remarkable win rates 20% Market penetration Source:
Slide 26: DI addresses larger budgets within existing accounts
DI addresses larger budgets within existing accounts Digital Intelligence offering Lab offering 40K Examiners 1 00K Analysts 1Million Investigators “For every $1 spent in the lab there is a $4 DI offering opportunity” Source: Cellebrite Proprietary Research 2020.
Slide 27: Example of ARR expansion outside of core Collection & Review offering
Example of ARR expansion outside of core Collection & Review offering 4 9 $ 15 0K $ 75 0K Collection & Review Full DI offering # o f s o l u tion s A RR 5x ARR expansion o pp or t u nity Note: Represents illustrative mid - sized customer. Figures are rounded.
Slide 28: Significant private sector growth opportunity
Significant private sector growth opportunity ~20% of revenue Broad adoption, More use cases + 500 customers I n cre as ed ARPC ( 1) ~10% of revenue Early adoption eDiscovery Corporate inv e sti g atio n s 1. Missing eDiscovery suite of tools 2. Unsolved internal security incidents 3. Limited access
Slide 29: Multiple vectors for near-term inorganic growth
Multiple vectors for near - term inorganic growth TAM Expansion Customer A c q u i s it i o n Investigative A nal y tic s (I A) eDiscovery, Corp Investigations & IA C o l l e cti o n & Review Command & Control M&A strategy defined by target segment’s projected impact on value creation objectives Pro
Slide 30: YTD customer and partnership successes
YTD 21 customer and partnership successes Customer Traction Increasing number of multi - solution large deals 1 customer > $ 5 M 8 customers > $ 1 M First Cellebrite Pathfinder implementation on agency’s private cloud for deployment to dispersed branches Solid traction for upcoming release of Celleb
Slide 31: Uniquely positioned in the competitive landscape
Uniquely positioned in the competitive landscape Full Device Access Enabled by a Deep Understanding of Data Structures Data Analytics capabilities No Device A cc e s s Integrated Suite Point Solutions Data Collection & Review capabilities Cellebrite is uniquely positioned as an industry leader in bo
Slide 32: What differentiates Cellebrite from other players
What differentiates Cellebrite from other players Strong, global brand with 10+ years of developing an end - to - end digital intelligence platform to fuse and enrich investigative data Deeply entrenched installed base of 5,000 public safety and 1,700 Enterprise customers Intrinsic knowledge of the
Slide 33: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview A pp e n d i x 1 2 3 4 5 6 Table of contents
Slide 34: Financial highlights
Financial highlights Sustainable ARR Growth ~53% ARR Growth Q1 ’21 Best - in - class Retention metrics 148% Net Retention LTM Mar - 21 98% Gross Retention 2020 Strong Margin profile 83% Gross Margin LTM Mar - 21 21% Adj. EBITDA Margin LTM Mar - 21 Note: non - GAAP metrics defined in the appendix.
Slide 35: Sustainable ARR growth
Sustainable ARR growth $ 7 6 $80 $83 $92 $96 $ 1 09 $ 1 21 $ 13 7 $ 1 50 $261 $197 Q 1 - 1 9 A Q 2 - 1 9A Q 3 - 1 9A Q 4 - 1 9A Q 1 - 20A Q 2 - 2 0 A Q 3 - 20A Q4 - 20A Q 1 - 2 1 A 20 2 1 E 20 2 2E 1 Growth rates compare to the reported ARR from the same quarter end in the prior year. % Total ARR Gr
Slide 36: Consistent ARR growth driven by expansion
Consistent ARR growth driven by expansion $ 72 $ 9 2 $ 1 37 $ 1 9 7 $ 2 61 $4 $ 16 $6 $ 39 $6 $ 54 $ 6 $ 58 2018 Total ARR New Net 2019 Logo Land Upsell/downsell Total ARR New Net 2020 Logo Land Upsell/downsell Total ARR New Net 2021 Logo Land Upsell/downsell Total ARR New Net 2022 Logo Land Upsell/
Slide 37: Operating leverage from disciplined investment
1 5% 1 6% 3 6% 33 % 2 7 % 2 7 % 2 0 1 9 A 2 0 2 0A 2 0 2 1 E 2 0 22E G &A S &M R&D 76% Operating leverage from disciplined investment 78% 7 4 % 6 8% Gross Margin Operating Expenses 1 as % of Revenue 7 9 % 8 0 % 81% 81% 9 2% 9 3 % 9 3 % 9 3 % 2 0 1 9 A 2 0 2 0A 2 0 2 1 E 2 0 22E Total Gross Margin Su
Slide 38: Financial forecast
2021E 2022E ARR Growth 44% 32% Revenue Growth 21% 20% Adjusted EBITDA Margin 1 15% 18% Long Term 22 – 27% 20 – 24% 25 – 35% Financial forecast Strong operational metrics 1 Excluding deferred customer acquisition costs adjustments as per updated accounting guidance and benchmarking, and as will be re
Slide 39: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview A pp e n d i x 1 2 3 4 5 6 Table of contents
Slide 40: True Wind overview
True Wind overview San Francisco - based private equity firm 75+ years of collective investing experience True Wind’s founding partners were previously the founding members of KKR’s technology franchise Fifteen full - time investment professionals with deep technology investing expertise Investing i
Slide 41: Transaction overview
Transaction overview 6 5% 3% 1 3% Key Proposed Transaction Terms Fully Diluted Enterprise Value of ~$1.8B (6.4x 2022E Revenue) Current owners will retain ~65% ownership in public Cellebrite Transaction will result in $430M of cash added to the balance sheet to fund accretive M&A and other strategic
Slide 42: Transaction timing and certainty
Transaction timing and certainty Business combination expected to close in Q3 2021 with significant deal certainty given that minimum cash requirement has predominately been fulfilled through the $300M of PIPE agreements already in place Diligence & Documentation Regulatory Review Process Shareholde
Slide 43: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview A ppe n dix 1 2 3 4 5 6 Table of contents
Slide 44: Financial summary – Q1
($K) March 20A March 21A ARR 98,542 150,480 YOY Growth - % 28.9% 52.7% Subscriptions 25,523 40,521 Perpetual License & Others 7,960 7,743 Professional Services 5,251 5,019 Total Revenue 38,734 53,283 YOY Growth - % 2 (3.4%) 37.6% Gross Profit 29,114 45,097 Gross Profit - % 75.2% 84.6% Adjusted EBITD
Slide 45: Financial summary - annual
($K) 2019A 2020A 2021E 2022E ARR 91,920 136,970 197,274 260,826 YOY Growth - % 28.5% 49.0% 44.0% 32.2% Subscriptions 86,647 129,745 180,876 228,500 Perpetual License & Others 59,175 42,136 26,538 20,484 Professional Services 26,032 23,032 28,223 33,816 Total Revenue 1 171,854 194,913 235,637 282,800
Slide 46: Adjusted EBITDA reconciliation – Q1
Adjusted EBITDA reconciliation – Q1 ($K) March 20A March 21A Net Income (Loss) in Financial Statements (7,257) 3,590 Financial Income (142) (366) T ax E x penses 901 1,163 Share Based Compensation Expenses 1,822 1,699 Amortization of Intangible assets 129 388 Acquisition Related Cost 1,666 3,721 Non
Slide 47: Adjusted EBITDA reconciliation - annual
Adjusted EBITDA reconciliation - annual ($K) 2019A 2020A 2021E 2022E Net Income (Loss) in Financial Statements (1,876) 5,781 14,017 30,096 Financial Income (2,935) (2,179) (1,920) (2,400) One - time Expense 4,034 1,519 - - T ax E x penses 3,291 5,616 4,426 9,504 Share Based Compensation Expenses 12,
Slide 48: Cellebrite solves more cases with fewer resources
Cellebrite delivers the capabilities to solve more cases with less resources, unlocking a massive social benefit to communities dealing with serious and pervasive crimes Case i n volveme n t 500K+ 1 C ases utilize Cellebrite’s solutions annually Time to ev i de n ce 3 0 x + 2 Faster time - to - coll
Slide 49: Proven land-and-expand upsell motion
Proven land - and - expand upsell motion Note: Cellebrite currently offers a total of 13 solutions (excluding additional services). $ 2 1 $ 2 1 $ 13 8 2018 2 Solutions 2020 4 Solutions 20 1 9 ~7x ARR Growth $ 23 4 $ 2 4 7 $1,150 20 1 9 Tier 1: Large U.K. PD ($K) Tier 2: U.S. City PD ($K) ~5x ARR Gro
Slide 50: Deep cache of active zero-day exploits allows differentiated access
Deep cache of active zero - day exploits allows differentiated access across device ecosystem Proven, consistent track record of enabling access to encrypted devices over the past 10 years Systematized ability to generate useful research assets or “zero - day exploits” to enable device access 5x inc
Slide 51: Publicly traded comparable companies overview
Publicly traded comparable companies overview CAGR CY20 - 22E Revenue Growth Recurring Revenue % 2 CY22E EBITDA Margin Comparability to Cellebrite EV/CY22 Revenue Source: As of 5/28/21. Company filings, Wall Street Research, FactSet. Note: ‘nm’ denotes not meaningful multiples <0x or >100x; “na” den
Slide 52: Operational benchmarking
18 % Median: 19% 28% 1 9% 4% 2 6% 12 % 9% 8% 7% 2% 1 6% 8% 5 % Operational benchmarking 2 0% 2 9% 27% 1 6% 27% 2 4% 23 % 18 % 1 4% 9% 18 % 1 6% 4% CAGR CY20 - 22E Revenue Growth EBITDA Margin 2022E Source: As of 5/28/21. Company filings, Wall Street Research, Factset. Business Model peers Public Saf
Slide 53: Valuation benchmarking
3 5 . 5x 5 6 . 5 x 32 . 6x 93.4x 86.0x 55 . 2 x 7 6 . 9x Valuation benchmarking 6 . 4x 1 0 . 9x 1 0 . 1x 9 . 2 x 1 4 . 3 x 1 0 . 4x 1 0 . 0x 9 . 5 x 8 . 5 x 7 . 9x 1 5 . 7 x 11 . 9x 9 . 3 x nm nm Source: As of 5/28/21. Company filings, Wall Street Research, CapIQ, Factset. Note: ‘nm’ denotes not mea
Slide 54: Compelling valuation discount to high growth peers
1 0. 9x 1 0. 1x 1 4 . 3x 1 0. 4x 10.0x 9 .5x 8.5x 7 . 9x R² = 0.3248 4 .0 x 6 .0 x 8.0 x 1 0 . 0x 1 2 . 0 x 1 4 . 0 x 1 6 .0 x 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 26% 27% CY 2020 – CY 2022E Revenue CAGR Source: As of 5/28/21. Company filings, Wall Street Research, F
Slide 55: Definitions
Definitions 1. Annual Recurring Revenue: Annual recurring revenue (“ARR”) is defined as the annualized value of active term - based subscription license contracts and maintenance contracts related to perpetual licenses in effect at the end of that period. Subscription license contracts and maintenan
Slide 56: Key risks
Key risks Investing in the PIPE offering (the “Offering”) involves a high degree of risk. Below is a non - comprehensive list of certain risks and uncertainties associated with Cellebrite DI Ltd. (the “Company,” “we,” “us” and “our”). You should carefully consider these risks and uncertainties, toge