Vivid Seats Inc. · NASDAQ:SEAT
Vivid Seats — SPAC Merger (September 2021)
51 slides from Vivid Seats's SPAC merger presentation, Sep 8, 2021
Slide 1: Analyst Day Presentation: Vivid Seats
Analyst Day Presentation: Vivid Seats (Nasdaq: SEAT) September 8, 2021
Slide 2: Disclaimer
Disclaimer This confidential presentation (the “presentation”) is being delivered to you by Vivid Seats Inc. (the “Company” or “Vivid Se ats ”) an indirect parent of Vivid Seats L.L.C. and contains information related to the proposed business combination of Vivid Se ats with Horizon Acquisition Corp
Slide 3: Disclaimer (continued)
Disclaimer (continued) Financial and Other Information This presentation includes certain non - GAAP financial measures (including on a forward - looking basis) such as EBITDA, EBITDA Mar gin, Adjusted EBITDA, Adjusted EBITDA Margin., Contribution Margin These non - GAAP measures are an addition, an
Slide 4: Agenda
01 Transaction & Sponsor Summary 02 Company Overview 03 Product & Technology Review 04 Brand & Marketing Overview 05 Financials 06 Q&A
Slide 5: Sponsor & Transaction Summary
Sponsor & Transaction Summary
Slide 6: Horizon Acquisition Corporation Investment Highlights
Vivid Seats • Horizon Acquisition Corporation Investment Highlights Todd L. Boehly CEO, CFO and Director - Horizon Acquisition Corp . • Co - Founder, Chairman and CEO of Eldridge - Eldridge has over $40 billion (1) in assets across multiple sectors, including media and entertainment and consumer - o
Slide 7: Transaction Summary
Vivid Seats • Transaction Summary Opportunity • Vivid Seats is a scaled, growing and highly profitable secondary ticketing marketplace • $39 billion growing ticketing industry (1) serving the sports and entertainment markets • Well - positioned for both significant immediate growth in post - pandemi
Slide 8: Investment Highlights
Vivid Seats • Investment Highlights Two - Sided Marketplace With Powerful Network Efficiencies 12+ Million Cumulative VS Customers 3,400+ Sellers (2019) Leading Player In Large Market Poised For Significant Recovery $39bn TAM (2019) 2 Outpacing Market Growth with Efficient Customer Acquisition Model
Slide 9: Sources & Uses and Pro Forma Valuation
Vivid Seats • Existing Shareholders 61% Sponsor Investment 8% PIPE 12% Horizon Public Shareholders 20% Sources & Uses Pro Forma Valuation Note: Assumes no redemptions from SPAC investors; all potential redemptions backstopped via an affiliate of the Sponsor. Excl ude s impact of 13.0m warrants held
Slide 10: SPAC Timing Update
Vivid Seats • Vivid Seats • April 21, 2021 April 22, 2021 May 28, 2021 July 7, 2021 August 16, 2021 ~30 Days 10 Horizon Acquisition Corporation (NYSE: HZAC) and Vivid Seats entered into a Transaction Agreement Announcement that VS would become a public company by merging with Horizon Acquisition Cor
Slide 11: Company Overview
Company Overview vividseats
Slide 12: Senior Leadership Team
Vivid Seats • Stan Chia CEO Lawrence Fey CFO Jon Wagner CTO Geoff Lester Chief Commercial Officer Riva Bakal SVP, Strategy & Product Sarah Doll Chief People Officer Today’s Presenters David Morris Dan Timm Tyra Neal General Counsel Chief Operating Officer Chief Marketing Officer 12 Senior Leadership
Slide 13: Our Mission and Business
Vivid Seats • Our Mission: To be the market - leading ticketing marketplace and technology partner that powers the ticketing ecosystem Our Business: We are a scaled, growing, and highly profitable secondary ticketing marketplace serving the concert, sports & theater markets • Full - service provider
Slide 14: Vivid Seats Is a Full-Service Marketplace
Vivid Seats • 14 Vivid Seats Is a Full - Service Marketplace… Sellers The picture can't be displayed. Free - to - use ERP system with direct integrations across all major marketplaces Skybox Marketplace available via app, desktop, and mweb Vivid Seats Marketplace Fans The picture can't be displayed.
Slide 15: With a Broad Portfolio of Events
Vivid Seats • 200,000+ Unique Events Sold (1) Concerts (46% of 2019 Marketplace GOV) Theater (12% of 2019 Marketplace GOV) 17 million+ Tickets Sold Full spectrum of ticket choices from 50 - yard line seats at the Super Bowl to standing room only tickets at small concerts Sports (42% of 2019 Marketpl
Slide 16: Fans and Sellers
Vivid Seats • 16 Sellers Fans The picture can't be displayed. The picture can't be displayed. Fan Breakout: Diverse age range with millennials representing the largest segment; no notable gender skew Audience is ripe for broad brand messaging Audience Segments: The picture can't be displayed. The pi
Slide 17: Two-Sided Value Proposition Drives Network Efficiencies
Vivid Seats • 17 Benefits to Sellers Benefits to Buyers Relationship Management Full - Service Support Broad Distribution & Marketing Value - Added Technology Fair Pricing and Terms Dedicated seller account management with deep understanding of business needs The picture can't be displayed. Drive se
Slide 18: Supply / Demand Dynamics Create Favorable Market Backdrop
Vivid Seats • Supply Demand Artist Reliance on Touring Income Sports teams, venues and promoters desperate for the return of audiences + Consumer Spending on Live Events Increasing Pre - Pandemic Higher Disposable Income Post - pandemic + + Large and Growing Market (1) $23 $24 $25 $26 $27 $28 $7 $8
Slide 19: Consumers Craving Live Experiences
Vivid Seats • $4.6 $2.7 Jan-19 Jun-19 Nov-19 Apr-20 Sep-20 Feb-21 Cumulative U.S. Personal Savings Since Jan - 19 Actual No Pandemic Scenario Sources: Bureau of Economic Analysis, 2020 Live Nation Global Impact of COVID - 19 on Live Events Benchmark Study, Company Estimat es (1) Live Music Event ref
Slide 20: Track Record of Growth Built on Innovation and Customer Service
Vivid Seats • Track Record of Growth Built on Innovation and Customer Service Founded in 2001, Vivid Seats scaled rapidly and is continuing to diversify its offering to drive sustained growth $ - $500 $1,000 $1,500 $2,000 $2,500 $3,000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Slide 21: Unique Value Proposition within Ticketing Ecosystem
Vivid Seats • (TM+ only) Growth Profitability Unique combination of growth, profitability and cash flow Well - positioned to exploit COVID - 19 dislocation and competitor M&A integration Freshly capitalized balance sheet and partnership with Horizon offers opportunity to accelerate momentum 21 Uniqu
Slide 22: Significant goodwill generated during pandemic amongst constituents • Provided customers option of cash refund
Vivid Seats • Significant goodwill generated during pandemic amongst constituents • Provided customers option of cash refund or loyalty + charity upon event cancellations • Introduced differentiated ‘net payment’ model with sellers in March • First marketplace to normalize payment terms with pay on
Slide 23: Product and Technology Review
Product and Technology Review
Slide 24: Data, Platform and Proprietary Algorithms Create Unique Value
Vivid Seats • Search Data Conversion Metrics Transaction History Seller Metrics Seating Charts Customer Traffic Data Pricing Information User Data Event Listings Third Party Data Demand Supply Market Buyers Sellers • Billions of data points optimize customer acquisition • Reach customers throughout
Slide 25: Tech Stack Enables Rapid Scaling, Integration and Innovation
Vivid Seats • Tech Stack Enables Rapid Scaling, Integration and Innovation 25 Modernized tech stack Integration capabilities Accelerated innovation Increased dev velocity Tech infrastructure: auto scaling Public company readiness The picture can't be displayed. The picture can't be displayed. The pi
Slide 26: App Provides a Holistic Engagement & Transactional Experience
Vivid Seats • 26 Discovery Engagement Rewards Program Transactional Path Simplified Purchase Personalized recommendations & discovery experience Content across genres & categories to engage users The most generous loyalty program in ticketing drives repeat purchases Streamlined shopping experience P
Slide 27: App Experience and Loyalty Program Increase Retention
Vivid Seats • 61 251 415 736 1,261 2015 2016 2017 2018 2019 App GOV has increased ~4x since 2017 and accounted for 40%+ of 2020 GOV (1 ) (1) Represents YTD GOV through February 2020 for owned properties Mobile App Transactions (000s) Tiered rewards system for every fan with in - app perks Auto - enr
Slide 28: Several Major Consumer Facing Launches in 2021
Vivid Seats • Positioning our consumer experience + brand as demand returns 28 App 3.0 1 2 Web 2.0 Loyalty 2.0 Brand (re)Launch 3 4 iOS & Android mWeb & Desktop Several Major Consumer Facing Launches in 2021
Slide 29: New Launches Cascade Across Consumer Experience
Vivid Seats • 29 Discovery Engagement Rewards Program Transactional Path Simplified Purchase Personalized recommendations & discovery experience Content across genres & categories to engage users The most generous loyalty program in ticketing drives repeat purchases Streamlined shopping experience P
Slide 30: Best-in-class Seller Technology with Skybox Platform
Vivid Seats • Cloud - based POS solution adopted by large share of seller base Rich feature set across key seller activities – inventory management, pricing, fulfillment, reporting and more Native integrations & listing toolsets provided to all sellers 3 rd party automation tools built around Skybox
Slide 31: Brand & Marketing Overview
Brand & Marketing Overview vividseats
Slide 32: Experience It Live! Brand Tenets
Vivid Seats • Vivid Seats • 32 We believe everyone should experience it live. Our mission is singularly focused on connecting buyers and sellers to enable memorable experiences Experience It Live! 100% Buyer Guarantee and winner of multiple awards for best customer service Trust Scale and structural
Slide 33: Brand Opportunity
Vivid Seats • The picture can't be displayed. 33 Aided Brand Awareness: <10% For Vivid Seats 75% 54% 33% 16% <10% Aided Brand Awareness Pre - Covid brand awareness metrics were also <10% (early 2020) Opportunity to craft a brand narrative which resonates with consumers and builds mindshare Aided bra
Slide 34: Visual Voice & Tone
Vivid Seats • 34 Visual Voice & Tone Speak to the fan in all of us Celebratory. Relatable. In - the - Know. mWeb Emails Corp Site Chat > The new brand shines across all consumer touch points We are bringing the passion and energy we have for live events to all fans
Slide 35: Our revamped loyalty program delivers even more value
Vivid Seats • 35 • Free tickets for every fan • Every purchase counts: Collect 10 stamps, get Reward Credit to earn a free ticket • Unlock perks as you progress from Rising Star to Super Fan to Icon -- including partner perks (e.g. DraftKings), surprise upgrades and more • Birthday gifts for all lev
Slide 36: Ready to invest across channels in brand marketing
Vivid Seats • 36 New brand visual + verbal identity in place • Capitalizes on the current desire for live events – passion, excitement and energy resonates with all fans • Safety and trust threaded through the visual and verbal identity: “informed” and “in - the - know” Brand Identity Product Experi
Slide 37: Financials
Financials vividseats
Slide 38: Vivid Seats Financial Highlights
Vivid Seats • Connecting millions of buyers with thousands of sellers • $2.2 billion of 2019 Marketplace Gross Order Value (‘Marketplace GOV’) • 17 million tickets sold by 3,000+ sellers across 200,000+ unique events in 2019 Growth at Scale Established history of generating significant profitability
Slide 39: Our P&L (2019 Figures)
Vivid Seats • 39 Marketplace $mm % Resale $mm % Revenue 403.6 100% Revenue 65.3 100% Less: Cost of Revenues (52.9) (13%) Less: Cost of Revenues (53.1) (81%) Gross Profit 350.8 87% Gross Profit 12.1 19% Less: Selling & Marketing (178.4) (44%) Less: Selling & Marketing 0.0 0% Contribution Margin 172.3
Slide 40: Return to Pre-Pandemic GOV in 2022 & Steady Growth Thereafter
Vivid Seats • (1) Marketplace GOV represents the total transactional amount of Marketplace segment orders placed on the Vivid Seats platfor m i n a period, inclusive of fess, exclusive of taxes, and net of event cancellations. (2) Adjusted EBITDA is not a measure defined under GAAP. Please see the a
Slide 41: Marketplace GOV, Orders and Average Order Size
Vivid Seats • $2,280 $347 $781 $2,364 $2,728 $3,090 2019 2020 2021 2022 2023 2024 Marketplace Gross Order Value ($mm) (1) 7,185 1,066 2,401 7,292 8,366 9,422 2019 2020 2021 2022 2023 2024 Total Marketplace Orders (000s) (2) $317 $326 $325 $324 $326 $328 2019 2020 2021 2022 2023 2024 Average Order Si
Slide 42: Multiple Drivers of Potential Upside Beyond the Forecast
Vivid Seats • $110 2022E Adjusted EBITDA Forecast Illustrative Adjusted EBITDA ($million) Illustrative Adj. EBITDA Impact of Potential Upside Levers $20 - $50 10 - 25% Industry Order Growth $15 - $45 5 - 15% Increase in AOS $35 - $70 5 - 10% Market Share Gain Marketing Efficiency $25 - $70 Structura
Slide 43: 2021 Outperformance Relative to Projections
Vivid Seats • ($million) (1) Marketplace GOV represents the total transactional amount of Marketplace segment orders placed on the Vivid Seats platfor m i n a period, inclusive of fess, exclusive of taxes, and net of event cancellations. (2) Adjusted EBITDA is not a measure defined under GAAP. Pleas
Slide 44: Q2 Financial Performance
Vivid Seats • $693mm of Marketplace GOV and 1.7mm Total Marketplace Orders • Meaningful ramp in Marketplace GOV and Total Marketplace Orders over the course of the quarter • Average Order Size (“AOS”) of $400+ driven by (1) pent - up demand and (2) onsales Marketplace GOV and Total Marketplace Order
Slide 45: Cash, Net Debt and Cash Flow
Vivid Seats • 45 • Cash balance: $461mm as of 6/30/21 - Cash balance reflects quarterly interest payment and quarterly amortization payment • Net debt: Significantly deleveraged pro forma balance sheet post business combination - Result of rapid right sizing of cost structure during pandemic with co
Slide 46: Comparable Company Benchmarking
Vivid Seats • EBITDA margin 34.0% 24.7% NM 30.0% 34.0% 33.9% NM NM 39.3% NM 15.6% 69.8% 14.4% 17.4% 18.1% 22.2% 22.0% 22.3% 29.9% 25.9% 32.1% 26.9% 11.4% 29.6% Source: Company information, Factset as of September 3, 2021 Notes: Financials calendarized to December year - end. Negative margins and 100
Slide 47: Comparable Company Benchmarking (continued)
Vivid Seats • 17.7x 35.0x NM 42.3x 53.1x 66.4x NM NM 50.4x NM 20.6x 43.7x 13.3x 28.1x 25.6x 32.6x 39.6x 49.6x 68.5x 65.6x 36.2x 49.8x 17.8x 25.8x EV / EBITDA EV ($bn) EV / Revenue Vivid Seats Marketplaces Ticketing 4.5x 12.7x 2.8x 12.1x 13.8x 14.7x 12.5x 6.3x 16.8x 4.1x 1.7x 5.9x 3.9x 10.9x 2.4x 9.9
Slide 48: Q&A
Q&A
Slide 49: Thank You!
Thank You! vividseats
Slide 50: Appendix
Appendix vividseats
Slide 51: GAAP Net Income to Adjusted EBITDA Reconciliation
Vivid Seats • 51 GAAP Net Income to Adjusted EBITDA Reconciliation ($million) 2019 2020 2020 2021 2020 2021 Net (loss) income ($53.8) $2.6 ($662.1) $2.6 ($700.6) ($17.6) Interest expense 41.5 16.8 13.5 16.8 22.8 33.2 Depreciation and amortization 93.1 0.5 24.1 0.5 48.0 0.8 Sales tax liability 10.0 1