Sezzle Inc. · NASDAQ:SEZL
Sezzle — 27th Annual Needham Growth Conference (January 2025)
40 slides from Sezzle's conference presentation, Jan 15, 2025
Slide 1: The Responsible Way to Pay – Investor Presentation
@sezzle The Responsible Way to Pay Investor Presentation 27 Annual Needham Growth Conference
Slide 2: Disclaimer
Disclaimer Cautionary Note Regarding Forward-Looking Statements This presentation (the “Presentation’) contains summary information about the activities of Sezzle as of the date of this Presentation. The information in this Presentation is of a general nature and does not purport to be complete and
Slide 3: Sezzle at a Glance
Sezzle at a Glance Sezzle Ine. | Investor Presentation 13
Slide 4: Prized BNPL Platform
Prized BNPL Platform AWARDED BY Mb Forbes MOURAAL Hrs) Money BUSINESS JOURNAL FORTUNE BuySide isi Worth Termination of Launch of WebBank IPO on Australian Attained Planned Merger with Zip Co. Delisted from ASX Partnership Securities Exchange (ASX) B Corp Certification (Announced Feb 2022) (Listed on
Slide 5: The Markets We Serve
The Markets We Serve
Slide 6: The Nascent and Growing BNPL Market
The Nascent and Growing BNPL Market Buy Now, Pay Later (BNPL) represents less than 2% Sezzle represents less than 1% of North America’s Total Commerce Transaction Value of North America’s Total BNPL Market Digital Other In-store Wallet Payment Financing 189 Products $129.98 3% Debit Card BNPL & POS
Slide 7: Projected U.S. BNPL Growth vs. Retail Sales Growth
Projected U.S. BNPL Growth vs. Retail Sales Growth U.S. Retail Sales Growth U.S. BNPL Growth NO ) S © Sezzle Inc. | ion 17
Slide 8: Why Millions of Consumers Choose Sezzle
Why Millions of Consumers Choose Sezzle Increasing financial inclusion by providing credit to those who often face challenges in accessing traditional credit options i 76% of Sezzle Consumers are ages between 18 — 46 (Gen Z & Millennial) of2 40% of BNPL users would leave carts without BNPL offered a
Slide 9: Robust & Expanding Product Ecosystem
Robust & Expanding Product Ecosystem
Slide 10: Comprehensive Suite of Payment Options
Comprehensive Suite of Payment Options Offering a full suite of payment options, allowing consumers to choose based on their schedule and needs Pay-in-Full Pay-in-2 Pay-in-4 Long-Term esexzle @sezzle Compete your ordar Example: $100 Purchase 100% 50% 50% 25% 25% 25% 25% Monthly With APR’ $100 $50 $5
Slide 11: Helping Consumers Build Credit History through Sezzle Up
Helping Consumers Build Credit History through Sezzle Up The only BNPL platform in North America to offer credit reporting optionality through Pay-in-4 in the U.S. and Canada TransUnion EQUIFAX Sexperian Innovis ) Files Sezzle Up consumer purchase activities to all major credit bureaus in the U.S. S
Slide 12: Sezzle Subscriptions
Sezzle Subscriptions ~~ ~ aan 59% Xx © In-app doo & scours i 5, More Orders from amicnion a In-store Orders es % 0p 10% Anywhere Sulnerare a, Ne © Pity eotomer sient Se eee M Subscribers during 2 S Up 101% bok on purchases pid upont Orders: Frequency 3Q24 on Average © 101 monty Seale Spend Deliverin
Slide 13: First Product Launch with WebBank
First Product Launch with WebBank On-Demand!’ Pay-in-4 Just Got More Flexible How it Works Benefits for Sezzle Shop any brand in the NY Sezzle app or anywhere? @, Enhances the ability to compete : for enterprise merchants Request single-use amount needed ®sezzle Pay 25% + a service fee at Early data
Slide 14: Unlocking Growth For Our Merchant Partners
Unlocking Growth For Our Merchant Partners Driving traffic and incremental revenue through a frictionless checkout experience and customized marketing capabilities Merchant Benefits Ad Integration Product Marketplace In-App Placement <6 Months’ Payback period Up to 57%' Average Order Value Lift T1lO
Slide 15: Expanding Our Ecosystem
Initial Business Model Expanding Our Ecosystem Launched in 2Q22 Launched in 2Q23 Launched in 4Q24 e e e > \ shopify MMegent WiXcor (CoD commence Premium ee tnd Direct & Virtual Card Integration Economics for Sezzle: + Merchant discount rate (MDR) + Interchange revenue (VC integration) On-Demand (Any
Slide 16: Expanding Reach & Consumer Impact through Innovation
Expanding Reach & Consumer Impact through Innovation Potential Future Products Subscription (2022 & 2023) Credit Reporting Direct Integration 02} (2017) R eae s cust ome Financial Tools Shopping Tools o On-Demand Product Marketplace Price Comparisons Premium & Anywhere zzi + Premium: Access to 350+
Slide 17: Saving with Sezzle
Saving with Sozzle Back-To-School Building Consumer Connections Edition és : through Strategic Marketing on @ Expanding Engagement Strategies Increasing Awareness, Personalization, & Testing C) * Official Jersey Patch Partner of the Minnesota Timberwolves + Expanding direct-to-consumer campaigns via
Slide 18: Growing Profitably Through Strong Execution
Growing Profitably Through Strong Execution
Slide 19: Early Focus on Profitability
Early Focus on Profitability $10 million Announced reduction of workforce Beginning in FY22 o Rr) Revenue Initiatives April $17+ million 21k Announced initiatives to accelerate path to profitability * Introduced Sezzle Premium + Incentivized consumers to shift from card to ACH * Offboarded or renego
Slide 20: Initiatives Drive Profitability
($41.5M) 2022 Adjusted Net Loss ($38.1) Million Initiatives Drive Profitability Initiatives Exceeding Expectations $58.0M 2024 Adjusted Net Income j ° ° ° $5.6M $71.5 Million 2023 Adjusted Net Income = 2023 Net Income 2024 Net Income 9 Net Impact Guidance ° of the Profitability o Initiatives 2022 Ne
Slide 21: Propelling Growth through a Bank Partner
Propelling Growth through a Bank Partner WebBank Partnership ®sezzle Launch of unified fees IW] WebBank : A STEEL PART S COMPANY + WebBank is a Utah-chartered Streamlined industrial bank regulatory approach + Entered 5-year strategic partnership program on August 26!", 2024; launched at the end of S
Slide 22: Robust & Proprietary In-House Underwriting Strategy
Robust & Proprietary In-House Underwriting Strategy False Prophet & | | | | a | ° | 3 San Nose Fraud Existing 3 Party ML Models Fraud Baby Prophet | > | Underwriting | CEneUGLS | Pan | e | Underwriting | aan 5 ™Baby Prophet = FICO 5 © 2 « > & = fa 2 fe} 5 2 j 3 eee 3 5 1 2 3 4 5 6 7 8 2 10 sky Consu
Slide 23: Quarter Snapshot
Quarter Snapshot 3Q23 3Q24 YoY Change Total Revenue $40.8M $70.0M 71.3% tf Net Income $1.3M $15.4M 1,093.3% ¥ Adjusted Net Income! $1.2M $17.3M 1,349.2% f Adjusted EBITDA Margin? 18.5% 32.2% 13.7Pts ff Related cori ane sor Tota Revers | 47.2% 55.0% 5.8 Pts f Nod Frage eee PEN 46.2% 30.0% -16.2 Pts ¥
Slide 24: 3Q24 YoY Engagement Metrics
3Q24 YoY Engagement Metrics Active Subscribers? (Premium & Anywhere) 3Q24 3Q23 3022 |) 88,000 210,000 +319k YoY 529,000 Repeat Usage As A % Of Total Orders (Cumulative) cot ET 25:7 +71 Bps YoY Active! Consumers Quarterly Purchase Frequency (Average) 1O, oct I 2,207,000 +3.7% || :0:1 ss. | +1.3x soz
Slide 25: Last Twelve Months (LTM) QoQ Engagement Metrics
Last Twelve Months (LTM) QoQ Engagement Metrics Active Subscribers? (Premium & Anywhere) Active! Consumers Unique Merchants? Shopped at by Consumers 529,000 462,000 371,000 307,000 a 4Q23 1024 2024 3Q24 2,667,000 2,601,000 2,594,000 2,612,000 | 4Q23 1Q24 2024 3Q24 208,000 178,000 173,000 7 4023 1024
Slide 26: Total Revenue & UMS
Total Revenue & UMS Total Revenue Underlying Merchant Sales (UMS) +40.6% YoY $659.9 $601.9 $70.0 $532.2 $469.5 $492.7 3Q23 4Q23 1924 2Q24 3Q24 3Q23 4Q23 1024 2Q24 3Q24 jam Total Revenue ($ in millions) ‘% of UMS. BUMS ($ in millions) Sezzle Inc. | Investor Presentation | 26
Slide 27: Transaction Related Costs
Transaction Related Costs Transaction Expense Provision for Credit Losses Net Interest Expense 2.3% [2m Lae 2.0% }{_1.9% 0.9% Ff 0.8% }1_0.8% $51 se gay $128 = (rox } $10.5 $10.1 Beee wae see cc Oo eo 3Q23 4Q23 1924 2Q24 3Q24 3Q23 4Q23 1924 2Q24 3Q24 3Q23 4Q23 1924 2Q24 3Q24 mmm Transaction Expense
Slide 28: Total Revenue Less Transaction Related Costs
Total Revenue Less Transaction Related Costs’ As a % of Total Revenue As a % of UMS $38.5 $38.5 3Q23 4Q23 1Q24 2Q24 3Q24 3Q23 4Q23 1024 2Q24 3Q24 ‘mmm Total Revenue Less Transaction Related Costs ($ in millions) tm Total Revenue Less Transaction Related Costs ($ in millions) % of Total Revenue % of
Slide 29: Non-Transaction Related Operating Expenses
Non-Transaction Related Operating Expenses % of Total Revenue Total Revenue Less Transaction Related Costs vs. Non-Transaction Related OpEx' $21.0 — 3Q23 4Q23 1924 2Q24 3Q24 3Q23 4Q23 1924 2Q24 3Q24 lames Non-Transaction Related Operating Expenses ($ in millions) —— Non-Transaction Related Operating
Slide 30: Net Income and Adjusted Net Income
Net Income and Adjusted Net Income Net Income Adjustments Adjusted Net Income! Includes $16.8 million discrete income tax } benefit from the release of the valuation | allowance previously recorded on deferred tax assets el = 2 $17.3 5164 GON 0.4) $13. $9.4 $8.0 gs $29 gio 826 —_—_ = ($16.6) —_ i 3Q
Slide 31: Net Income and Adjusted EBITDA
Net Income and Adjusted EBITDA’ Net Income & Adjusted Net Income? Non-GAAP Adjusted EBITDA $29.7 $22.5 17.3 36.42 $13.1 $8.0 $94 $2.9 $2.6 $13. $1.2 : a | 3023 4023 1024 2024 3Q24 3023 4Q23 1024 2024 3Q24 Net Income ($ in millions) '§ Adjusted Net Income ($ in millions) (mmm Adjusted EBITDA ($ in mi
Slide 32: Select Balance Sheet Metrics
Select Balance Sheet Metrics Unaudited Unaudited Unaudited $ in Thousands Mar 31, 2024 Jun 30, 2024 Sep 30, 2024 Key Assets N Cash and cash equivalents! $77,785 $58,026 $80,063 Restricted cash $4,400 $5,966 $8,281 Total cash $82,185 $63,992 $88,343 Total notes receivables, net $103,332 $119,235 $132
Slide 33: Outlook
Outlook 2023 Actual ote FY2024 Projections’ Total Revenue $159.4M 55% Growth Exceed i 7 Total Revenue Less Transaction Related Costs! as 50.8% 55.0% Meet a % of Total Revenue Net Income $7.1M $71.5M Exceed Net Income Per Diluted Share $1.25 $12.05 Exceed Adjusted Net Income? $5.6M $58.0M Exceed Adju
Slide 34: Appendices
Appendices Sezzle Inc. | Investor Presentation [34
Slide 35: Appendix I: Reconciliation of GAAP to Non-GAAP Measures
Appendix I: Reconciliation of GAAP to Non-GAAP Measures Total Revenue Less Transaction Related Costs For the three months ended For the twelve months ended (in $ thousands) September 30.2024 June 30.2024 March 31.2024 December 31,2023 September 30.2023 December 31,2023 December 31, 2022 ‘Operating i
Slide 36: Appendix II: Reconciliation of GAAP to Non-GAAP Measures
Appendix II: Reconciliation of GAAP to Non-GAAP Measures Transaction Related Costs For the three months ended (in $ thousands) September 30, 2024 June 30, 2024 March 31, 2024 December 31,2023 September 30, 2023 Operating expenses $ 49,117 $ 39,269 $ 33,144 $ 41,234 $ 35,494 Personnel (13,424) (12,73
Slide 37: Appendix III: Reconciliation of GAAP to Non-GAAP Measures
Appendix III: Reconciliation of GAAP to Non-GAAP Measures Adjusted Net Income (Loss) For the three months ended For the twelve months ended fin $ thousand: except per share amounts) September 30,2024 June 30,2024 March31, 2024 December 31, 2023 September 30, 2023 December 31,2023 December 31, 2022 N
Slide 38: Non-GAAP Financial Measures
Non-GAAP Financial Measures To supplement our operating results prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), we present the following non-GAAP financial measures: Total revenue less transaction related costs; transaction related costs; non-trans
Slide 39: Non-GAAP Financial Measures (Cont.)
Non-GAAP Financial Measures (Cont.) Additionally, we have included these non-GAAP measures because they are key measures used by our management fo evaluate our operating performance, guide future operating plans, and make strategic decisions, including those relating to operating expenses and the al
Slide 40: Thank You
Thank You Lee Brading, CFA SVP, Corporate Development & Investor Relations InvestorRelations@sezzle.com Erin Foran Media & PR MediaRelations@sezzle.com Sezzle Inc. | Investor Presentation | 40
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