Life360, Inc. · NASDAQ:LIF
Life360 — Morgan Stanley Australian Emerging Companies Conference 2019
37 slides from Life360's conference presentation, Jun 11, 2019
Slide 1: Morgan Stanley Australian Emerging Companies Conference Presentation
ASX ANNOUNCEMENT 11 June 2019 Morgan Stanley Australian Emerging Companies Conference Presentation Life360, Inc. (Life360 or the Company) (ASX: 360) will deliver a presentation to the Morgan Stanley Australian Emerging Companies Conference on 12 June 2019 in Sydney. Chief Financial Officer Wendell L
Slide 2: A membership service for modern families
A membership service for modern families Wendell Laidley, Chief Financial Officer
Slide 3: Important notice and disclaimer
This document dated 11 June 2019 has been prepared assessment of the Company and conduct its own prospective investor or purchaser may require in in this document to reflect any change in expectations in by Life360, Inc. (Company) and is provided for investigations and analysis. Investors should ass
Slide 4: Agenda
1 Company and business model overview 2 Summary 3 Q&A 4 Appendix 3
Slide 5: Company and business model overview
Section 1 Company and business model overview
Slide 6: Capitalisation and key metrics
Capitalisation and key metrics Note: Market data as at 7 June 2019. (1) Converted to AUD at indicative exchange rate of AUDUSD 0.70. (2) AMR as at December 2018 excludes revenue generated from the Allstate proof of concept trial. 5
Slide 7: Our audience, our business, our team
Our audience Our business Our team >20m >579k >US$200m Monthly Active Users paying families total funding (MAU) (referred to as Paying Circles) to date >10 US$75m >120 average daily interactions Dec-19F AMR(2) FTEs with our per User(1) >65% YoY growth HQ in San Francisco Our impact “ My two teenage
Slide 8: We make your family's daily moments go mobile
We make your family’s daily moments go mobile 7 Note: Pet tracking and residential security are future potential development initiatives. 7
Slide 9: Location, places and notifications, driving, safety
Location Places & notifications Driving Safety ✓ Private family map shows ✓ Setup geo-fenced places and ✓ Driving behaviour analysis ✓ Help Alert real-time locations location alerts ✓ 24/7 roadside assistance ✓ Crime reports ✓ Check-in, send messages and ✓ Get other smart alerts like low ✓ Collision
Slide 10: Over 1.5 billion smartphone users in the world
Family Friends Professionals There are over 1.5 billion smartphone Users in the world(1). All smartphone connected families are our target customers. (1) Excluding PRC which has over 700 million smartphone users according to a report issued by Newzoo (Global Market Report, 2017). 9
Slide 11: Architecture and platform technology
Architecture Platform technology Scalable, cloud-based infrastructure ✓ Extremely high accuracy, low latency and long battery Capital-light infrastructure which allows us to rapidly scale and Proprietary life meet our Users’ needs as we grow location ✓ Consumes on average less than 10% of total batt
Slide 12: Market leading app, differentiated technology, family focus
Market Technology differentiated from other Product focused leading app generic offerings on family Generic features, iOS Service is laser focused only, no audience on family-oriented focus features Generic features, no audience focus, swiss army knife Safety offerings expand far beyond just locatio
Slide 13: Any smartphone connected family is a potential customer
◼ We currently operate in over 160 countries and are growing across all primary regions ◼ U.S. is our current focus (with the most product features and paid User spend) and we are working towards achieving feature parity via investment in R&D ◼ We have a large total addressable market of 1.5 billion
Slide 14: Monthly reported revenue
Monthly reported revenue(1) US$5.5m Dec-19F AMR: US$5.0m US$75.1m US$4.5m US$4.0m US$3.5m US$3.0m US$2.5m US$2.0m US$1.5m US$1.0m US$0.5m US$0.0m Jun-16 Nov-16 Dec-16 Jun-17 Nov-17 Dec-17 Jun-18 Nov-18 Dec-18 Jul-16 Jul-17 Jul-18 Oct-16 Oct-17 Oct-18 Feb-16 Apr-16 Sep-16 Feb-17 Apr-17 Sep-17 Feb-18
Slide 15: Freemium model and growth in Paying Circles
◼ We operate under a “freemium” model where our core offering, the Life360 App, is available to Users at no charge, with two premium subscription options available (Life360 Plus and Driver Protect) ̶ Life360 Plus was introduced in 4Q16 while Driver Protect was introduced in 1Q17 to the U.S.(1) ◼ New
Slide 16: User engagement and retention
◼ Our User base is extremely engaged – particularly in the U.S. where parents have 15 daily interactions with the App on average(1) ◼ Our retention rates are extremely high compared to industry norms and stabilise over time ◼ Retention rates are also increasing for both freemium and premium Users on
Slide 17: Return on R&D and 12 month roadmap
◼ We continuously invest in R&D to improve the platform and extend the range of our offered services (>70% of FTEs are engaged in product development(1)) ̶ Our R&D spend has generated significant returns historically ◼ Our target industries include General Insurance, residential security systems, cr
Slide 18: Allstate partnership and indirect revenue contribution
Overview of Overview of CY19F Indirect Revenue contribution agreement contextual offer ▪ Driving data is anonymously shared with arity (an indirect wholly-owned subsidiary of Allstate, one of the largest US-based insurers), which Contextual offer(1) calculates a driving score based on driving 32% be
Slide 19: Disrupt the multi-billion dollar industries protecting what you care about
Disrupt the multi-billion dollar industries protecting what you care about most Mobile-first approach to industries Incumbents do not meet the needs Our engaged digital User base built on 90s technology of digitally native families is a Trojan Horse for these categories Auto Roadside Insurance Assis
Slide 20: Product and service expansion opportunities
Product and service expansion opportunities Current Near-term Future Starting to monetise in driver safety vertical om» i Crash and roadside P Par A a cmiecnas (@) Identity theft By Elder monitoring Our vision for a bundled Expand into new verticals membership service @ Auto insurance Travel insuran
Slide 21: Revenue growth and scalable cost base
Monetisation of user base driving strong revenue growth Scalable cost base with discretionary investment US$m Other R&D User acquisition US$m Revenue Annualised monthly revenue 100 80 80 60 60 40 40 20 20 0 0 CY 16 CY 17 CY 18 CY 19F CY 16 CY 17 CY 18 CY 19F EBITDA losses reflect investment in R&D a
Slide 22: Co-Founders, Board and Executive team
Co-Founders and Board Chris Hulls Alex Haro John Coghlan James Synge Brit Morin Mark Goines David Wiadrowski Co-Founder & Co-Founder Independent Non-Executive Independent Independent Independent Chief Executive Officer & President Non-Executive Chairman Director Non-Executive Director Non-Executive
Slide 23: Summary
Section 2 Summary
Slide 24: Summary of investment highlights
Leading family safety digital brand with a committed and growing global user base of >20 million MAUs Disrupting incumbents in safety, security and insurance via a scalable, low cost mobile-first offering Large total addressable market — any smartphone connected family is a potential customer Self-r
Slide 25: Appendix section
Section 3
Slide 26: Appendix section
Section 4
Slide 27: Relative penetration by U.S. state
Relative penetration by U.S. state Penetration is higher where younger heads of household are common The South foreshadows the demographic trends that will become more prevalent around the country and globe New features in our roadmap will also be more applicable to younger families As our App becom
Slide 28: Gaining traction in international markets
◼ ~80% of new Users in the U.S. are organic ◼ We consistently rank either number one or near the top for most searches related to our core functionality (for example, “location services” and “driving”) ◼ We have already reached brand awareness of >29% of U.S. parents with children under the age of 1
Slide 29: New paid registrations and user acquisition spend
◼ There is significant room to scale profitable paid User acquisition channels as demonstrated by our historical breakeven period ◼ This will make it more difficult for competitors to build a competing user base while also accelerating our User growth ◼ A significant use of the Offer proceeds will b
Slide 30: Cash recovery of paid user acquisition
◼ We began acquiring Users in 2017 through channels such as Apple iTunes App Store, Google Play Store, and more recently Facebook, YouTube and Instagram ◼ Current strategy in the U.S. is to acquire any User we believe has a reasonable prospect of generating positive cash flow within a prescribed win
Slide 31: Annualised Direct ARPPC
◼ We have consistently increased the amount of Direct Revenue generated on a per Circle basis in both the U.S. and Internationally ̶ This reflects the shift in product mix towards premium subscriptions and particularly, the higher priced Driver Protect product (Driver Protect Lite in International r
Slide 32: Forecast revenue drivers
Type Region Drivers U.S. MAU Conversion rate Direct ARPPC Direct International MAU Conversion rate Direct ARPPC U.S. MAU Indirect ARPU Indirect International MAU Indirect ARPU Not included in Prospectus forecast. 31
Slide 33: Growth in MAU and Paying Circles
Growth in Monthly Active Users (MAU) (millions) Growth in Paying Circles (thousands) US International US International 25 600 20 500 400 15 300 10 200 5 100 0 0 1H16 2H16 1H17 2H17 1H18 2H18 1Q19 1H16 2H16 1H17 2H17 1H18 2H18 32
Slide 34: Specific forecast revenue assumptions
Pro Forma Historical Pro Forma Forecast Specific forecast revenue assumptions US$ millions CY16 CY17 CY18 CY19F Difference ◼ Reflects continued organic growth combined with an increase in acquired Total MAU Users from paid acquisition spend MAU U.S. 3.2 5.7 10.0 14.1 41.1% ◼ Assumed to remain broadl
Slide 35: Forecast revenue and expense commentary
Pro Forma Historical Pro Forma Forecast Commentary US$ millions CY16 CY17 CY18 CY19F Difference ◼ Revenue growth is expected to be driven by an increase in Paying Circles (due to ramp up in User acquisition costs and AMR (1 ) 7.8 16.5 45.3 75.1 65.8% improving penetration) and growth in Indirect Rev
Slide 36: EBITDA to operating cash flow
Pro Forma Historical Pro Forma Forecast Commentary US$ millions CY16 CY17 CY18 CY19F Difference ◼ Operating cash flow is expected to be higher than EBITDA as a result of the annual EBITDA (13.7) (13.2) (20.0) (30.2) 50.6% subscriptions we offer to Users, which is reflected in the deferred revenue ba
Slide 37: Pro forma balance sheet adjustments
Conversion of O/S 31 December Preferred Remeasurement of Stock into Common Preferred Stock Warrant Conversion of Preferred Issuance of IPO Audited Stock Liability Stock Warrant Liability Zen Labs Acquisition Common Stock Pro Forma US$ millions Dec-18 Adjustment 1 Adjustment 2 Adjustment 3 Adjustment
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