Riskified Ltd. · NYSE:RSKD
Riskified — Q1 2023 Earnings Presentation
29 slides from Riskified's earnings presentation, May 17, 2023
Slide 1: Investor Presentation
May 2023 Investor Presentation
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking st
Slide 3: Key Performance Indicators and Non-GAAP Measures
Key Performance Indicators and Non-GAAP Measures This presentation contains key performance indicators including GMV as well as non-GAAP measures, including Adjusted EBITDA and Free Cash Flow. “Gross Merchandise Volume” or “GMV” is defined as the gross total dollar value of orders reviewed through o
Slide 4: Strong Q1'23 Financial Performance
Strong Q1’23 Financial Performance1 Continued Strong Balance Revenue Growth Sheet YoY growth of 17% in Q1’23, an Cash, deposits and accrued interest of acceleration from our Q4’22 growth of 14%. $484 million and no debt. Improved FCF + Bottom-Line Q1 Adjusted EBITDA of ($5.2) million, a Free Cash Fl
Slide 5: Meet Riskified
Meet Riskified Increase sales approval rates by Our mission is to up to 20%1 empower businesses to realize the full Reduce costs by up to 60%1 potential of eCommerce by Eliminate significant customer making it safe, friction, power omnichannel accessible and commerce and open new, frictionless. glob
Slide 6: We Operate in Massive Markets With Strong Tailwinds
We Operate in Massive ~$7.6 trillion global Markets With Strong eCommerce GMV in 20261 Tailwinds Solving Problems That Touch eCommerce Orders $5.4 trillion global eCommerce GMV in 20221 2022: $100B+2 1 Source: eMarketer (December 2022). 2 GMV reviewed by Riskified during the twelve months ending Dec
Slide 7: Direct Sales Force Focused on the World's Largest Merchants
Direct Sales Force Focused on the World’s Largest Merchants Online merchants with more than $75 million in annual eCommerce sales make up approximately 85% of sales made directly Segments of focus Strategic from the retailer’s website (>$3B online sales) or mobile app.1 Super Enterprise (>$500M to $
Slide 8: eCommerce Has Massive Friction Points
eCommerce Has Massive Friction Points Friction & Lost Sales • Customer Frustration Leads to Lost Merchant Fraud & Sales Chargebacks Abuse & Policy Enforcement • Numerous, Complicated Banking & and Expensive Pain Payments Points Account Security
Slide 9: Riskified Enables Frictionless eCommerce
Riskified Enables Frictionless eCommerce Before Riskified: With Riskified: 3rd Party Data Merchant.com Homegrown Tools & Reporting Registered Guest Merchant.com Successful Sale Customers Customers Require Is This The Authenticated Additional Customer That I Log On Credentials? Think It Is? Successfu
Slide 10: Riskified Value Proposition: Significant Sales Uplift and Attractive ROI
Riskified Value With Riskified Fewer declined orders builds Proposition: Before Riskified Declined Orders deeper customer loyalty and drives additional revenue for Significant Declined Prevented merchants False Declines Orders Sales Uplift and Attractive ROI Our solutions convert bank declines and f
Slide 11: We Increase Merchants' Revenue & Decrease Costs
We Increase Merchants’ Revenue & Decrease Costs Average of Ten 39% Largest Merchants 8% in Sample1 Company A 67% < $5.0 billion 14% Company B 51% < $5.0 billion 32% Company C 65% $5.0 - $10.0 billion 1% Company D 33% < $5.0 billion 6% Company E 57% > $10.0 billion 2% Merchant 50% 0% Online 0% 10% 20
Slide 12: What Sets Riskified Apart
What Sets Riskified Apart Labelling – Closed loop system with high quality data purity Network – Scaled merchant network of pre-eminent eCommerce brands Integration – Deeply integrated delivery model driving strong retention Performance Management – Active monitoring, segmentation and optimization I
Slide 13: Innovative Technology Platform
Innovative Fraud & Chargeback Abuse & Policy Enforcement Account Security Banking and Payments Technology PRODUCTS Chargeback Guarantee Policy Protect Account Secure PSD2 Optimize Platform RISK Constant Optimization & ● Automated, real-time Realtime Training Data Exposure Modeling Active Monitoring
Slide 14: Our Platform Gets Stronger with Each Transaction Reviewed
Our Platform Gets Stronger with Each Transaction Reviewed(1) Boost and Merchant Added Merchant Revenue Attract New Merchants Product Innovation More Data, Improved Accuracy 1 including whether or not those transactions result in eligible chargebacks.
Slide 15: Chargeback Guarantee Revenue Model
Chargeback Guarantee Riskified’s GMV Total eCommerce volume submitted to Riskified for review Revenue Model Flow Approval Rate (%) Varies by merchant based on a variety of inputs, including the Take Rate (%) industry of the merchant, the risk level of the end market, the Take percentage of GMV we re
Slide 16: Guidance Outlook
Guidance Outlook Improved Bottom-Line Guidance for 2023 Guidance as of Q4’22 Revenue $297M - $303M Adjusted EBITDA YTD Weighted ($27M) - ($22M) $300M ~($15M) Average Shares 175.4 Million Revenue Adjusted EBITDA Outstanding Midpoint Midpoint Updated Guidance as of Q1’23 Revenue $297M - $303M Adjusted
Slide 17: Q1 2023 Business Highlights
Q1 2023 Business Highlights Expanded New Logos Outside of Tickets and Travel: Further diversified the platform with the onboarding of new merchants. Eight of the top 10 new merchants won during the first quarter represented categories outside of Tickets and Travel. In particular, one new merchant is
Slide 18: Q1 2023 Business Highlights (continued)
Q1 2023 Business Highlights (continued) Appointed First Chief Marketing Officer: Jeff Otto will be responsible for a global integrated marketing strategy that will amplify our brand, strengthen its category leadership and accelerate demand for our expanding product suite. We believe that Mr. Otto ha
Slide 19: Q1 2023 Business Highlights (continued)
Q1 2023 Business Highlights (continued) Won TrustRadius “Top Rated” Awards: Awarded a "Top Rated” distinction from TrustRadius, a B2B decisioning platform for technology buyers. Riskified earned top rankings in all four product categories: conversion rate optimization, eCommerce analytics, fraud det
Slide 20: Q1 2023 Financial Highlights
Q1 2023 Financial Highlights GMV $27.3B Revenue $68.9M Gross Profit $35.8M Adjusted EBITDA(1) $(5.2M) (1) A reconciliation of Adjusted EBITDA to it most directly comparable GAAP financial measure, Net Profit (Loss), is provided in the Appendix.
Slide 21: FY 2022 Financial Highlights
FY 2022 Financial Highlights GMV $105.6B Revenue $261.2M Gross Profit $135.1M Adjusted EBITDA(1) $(36.4M) (1) A reconciliation of Adjusted EBITDA to it most directly comparable GAAP financial measure, Net Profit (Loss), is provided in the Appendix.
Slide 22: Industry and Geo Billings Trends
Industry and Geo Billings Trends We continue to diversify across industries and geographies, with accelerated growth in both EMEA and APAC ~60%
Slide 23: Existing Customer Penetration
Existing Billings Growth by Cohort(1)Outlook Customer Penetration We have increased billings from our mature cohorts(2) by ~200%.(3) We believe our more recent cohorts represent a similar expansion opportunity. (1) Each “cohort” includes all of the accounts that onboarded to the Riskified platform i
Slide 24: CTB Ratio by Cohort
CTB Cohorts CTB Ratio by Cohort(1)Outlook Over Time While CTB ratios fluctuate from period to period as a result of various factors, including changes in industry mix within 2021 Cohort cohorts, over the long-term we have been able to consistently 2020 Cohort demonstrate 2013-2016 Cohorts improvemen
Slide 25: Appendix
Appendix
Slide 26: Q1 2023 GAAP Financial Results
Q1 2023 GAAP Financial Results $ in thousands Q1'22 Q1'23 Revenue 58,845 68,907 Cost of revenue 28,477 33,066 Gross profit 30,368 35,841 Operating expenses: Research and development 18,113 18,794 Sales and marketing 23,129 22,123 General and administrative 21,952 17,913 Total operating expenses 63,1
Slide 27: Q1 2023 Reconciliation of GAAP Net Profit (Loss) to Adjusted EBITDA
Q1 2023 Reconciliation of GAAP Net Profit (Loss) to Adjusted EBITDA $ in thousands Q1'22 Q1'23 GAAP Net profit (loss) (33,264) (17,951) Non GAAP expenses: Share-based compensation expense 18,387 16,356 Payroll taxes related to share-based compensation 13 147 Depreciation and amortization 979 1,283 I
Slide 28: Q1 2023 Reconciliation of Operating Cash Flow to Free Cash Flow
Q1 2023 Reconciliation of Net Cash Provided by (Used In) Operating Activities to Free Cash Flow $ in thousands Q1'22 Q1'23 Net cash provided by (used in) operating activities (7,026) 229 Purchases of property and equipment (2,545) (187) Capitalized software development costs (427) - Free Cash Flow (
Slide 29: Investor Relations Contact
Investor Relations: Chett Mandel, Head of Investor Relations ir@riskified.com Corporate Communications: Cristina Dinozo, Senior Director of Communications press@riskified.com