Cellebrite Di Ltd. · NASDAQ:CLBT
Cellebrite Di — SPAC Merger (August 2021)
54 slides from Cellebrite Di's SPAC merger presentation, Aug 13, 2021
Slide 1: Investor Presentation August 2021
Investor Presentation August 2021 Filed by Cellebrite DI Ltd. Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rule 14a - 12 of the Securities Exchange Act of 1934 Subject Company: TWC Tech Holdings II Corp. Commission File No. 001 - 39499 Date: August 12, 2021
Slide 2: Disclaimer
Disclaimer This presentation (“Presentation”) contains proprietary and confidential information of Cellebrite DI Ltd. (“Cellebrite” or t he “Company”) and TWC Tech Holdings II Corp. (“TWC”) and the entire contents should be considered “Confidential Information.” This Presentation is made solely for
Slide 3: Disclaimer: Non-GAAP Measures, Projections, Forward Looking Statements
Disclaimer Use of Non - GAAP Financial Measures In addition to financial information presented in accordance with U . S . generally accepted accounting principles ( “ GAAP ” ), this Presentation includes non - GAAP financial measures, non - GAAP operating income and Adjusted EBITDA . These non - GAA
Slide 4: 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 5: Investment highlights
Investment highlights Cellebrite is the clear market leader with 99% win rate within digital intelligence Massive $ 12 B+ market opportunity for digital intelligence ( “ DI ” ) solutions with major secular tailwinds supporting continued growth Unique mission critical end - to - end digital intellige
Slide 6: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview Appendix Table of contents 1 2 3 4 5 6
Slide 7: 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 8: 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 9: Cellebrite empowers the world's leading government agencies and enterprises
Cellebrite empowers the world ’ s leading government agencies and enterprises Federal State & Local Enterprise 9 of Top 10 Accounting Firms 6 of Top 10 Pharma Companies 8 of Top 10 U.S. Commercial Banks 5 of Top 10 Auto Manufacturers 6 of Top 10 Petroleum Refiners 6 of Top 10 Telecom companies 9 of
Slide 10: Investigations today are manual, slow, and siloed
Investigations today are manual, slow, and siloed Backlog Manual review of data Initial handling Rely on a few overwhelmed people, with limited tech, to uncover insights Siloed task forces Slow, manual Error prone Data loss due to miscommunication Slow and cumbersome first responses Manual and error
Slide 11: Cellebrite delivers a comprehensive DI software platform
Cellebrite delivers a comprehensive DI software platform DI PLATFORM DATA SOURCES Prosecutors Agency Management Lab Practitioners Investigators & Analysts DATA TYPES OUTCOMES Accelerated investigations Empowering Chiefs of Investigations & Intelligence with end - to - end investigative platform Incr
Slide 12: 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 13: Analyze solution overview
Analyze solution overview Value Proposition: Automates and accelerates analysis of investigative data and the delivery of insights Key Benefits Expedites time - to - evidence in investigations Automatically surfaces formatives leads and actionable insights Accelerates time - to - evidence by up to 3
Slide 14: 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 15: Services overview
Serv ices overview DI Training Customized Training Certification and Accreditation Mentorship Program System Integration, Automation and Customization Advisory and Consulting Business Discovery Advanced Digital Data Access and Collection Crypto Investigations Expert Lab Services Remote Global Suppor
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: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview Appendix 1 2 3 4 5 6 Table of contents
Slide 18: 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 19: 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 20: Public safety's digital transformation will drive meaningful growth
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 coll
Slide 21: Massive digital intelligence market – $12B+ TAM in 2023
Massive digital intelligence market – $12B+ TAM in 2023 $2.7B $5.5B $0.8B $1.7B $ 1.6 B $ 12.3 B Collection & Review Investigative Analytics Management Services eDiscovery & CI TAM USD Number of agencies Avg. spend per agency 2 Federal $4.7 B State & Local $6.0 B Private Sector $1.6 B TAM by Custome
Slide 22: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview Appendix 1 2 3 4 5 6 Table of contents
Slide 23: Significant near-term growth opportunity
Significant near - term growth opportunity 5x 1 increase in spend on in - house discovery and investigations M&A Targeted, disciplined approach Private sector growth New and extended offering Premium Enterprise Cloud & SaaS Remote collection New buying centers within existing logos Net new expansion
Slide 24: 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 1 140 %+ ARR Net Retention 2 Sticky solution with remarkable win rates 20 % Market penetration Sourc
Slide 25: DI addresses larger budgets within existing accounts
DI addresses larger budgets within existing accounts Lab offering Digital Intelligence offering 40 K Examiners 100 K Analysts 1 Million Investigators “For every $1 spent in the lab there is a $4 DI offering opportunity” Source: Cellebrite Proprietary Research 2020 .
Slide 26: Example of ARR expansion outside of core Collection & Review offering
Example of ARR expansion outside of core Collection & Review offering 4 9 $150K $ 750 K Collection & Review Full DI offering # of solutions ARR 5x ARR expansion opportunity Note: Represents illustrative mid - sized customer. Figures are rounded.
Slide 27: Significant private sector growth opportunity
Significant private sector growth opportunity ~20% of revenue ~10% of revenue Broad adoption, More use cases + 500 customers Increased ARPC (1) Early adoption eDiscovery Corporate investigations 1. Missing eDiscovery suite of tools 2. Unsolved internal security incidents 3. Limited access to suspect
Slide 28: Multiple vectors for near-term inorganic growth
Multiple vectors for near - term inorganic growth TAM Expansion Customer Acquisition Investigative Analytics (IA) eDiscovery, Corp Investigations & IA Collection & Review Command & Control M&A strategy defined by target segment’s projected impact on value creation objectives Product & Feature Enhanc
Slide 29: Q2 customer successes
Q2 21 customer successes Customer Traction Large Deal Example 1 Increasing number of large multi - solution deals 1 customer > $ 5 M 9 customers > $ 1 M Large Deal Example 2 Large Deal Example 3 Scandinavian long - term customer Need: improve efficiency and reduce backlogs Pre - booking of Premium E
Slide 30: Uniquely positioned in the competitive landscape
Uniquely positioned in the competitive landscape Full Device Access Enabled by a Deep Understanding of Data Structures Point Solutions Data Analytics capabilities Data Collection & Review capabilities No Device Access Integrated Suite Cellebrite is uniquely positioned as an industry leader in both d
Slide 31: 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 Top research team from elite intelligence units (e.g. 8200 ) generating unmatched capabilities Deeply entrenched i
Slide 32: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview Appendix 1 2 3 4 5 6 Table of contents
Slide 33: Financial highlights
Financial highlights Sustainable ARR Growth 46% ARR Growth Q2 ’21 Best - in - class Retention metrics 142% Net Retention LTM Jun - 21 98% Gross Retention 2020 Strong Margin profile 8 3 % Gross Margin LTM Jun - 21 22 % Adj. EBITDA Margin LTM Jun - 21 Note: non - GAAP metrics and key performance indic
Slide 34: Sustainable ARR growth
Sustainable ARR growth $76 $ 80 $ 83 $ 92 $96 $ 109 $121 $137 $150 $ 159 $ 197 $ 261 Q1-19A Q2-19A Q3-19A Q4-19A Q1-20A Q2-20A Q3-20A Q4-20A Q1-21A Q2-21A 2021E 2022E 1 Growth rates compare to ARR from the same quarter end in the prior year. % Total ARR G rowth (YoY) 1 26 % 37 % 28 % 49 % 23 % 27 %
Slide 35: Consistent ARR growth driven by expansion
Consistent ARR growth driven by expansion $72 $ 92 $137 $ 197 $261 $4 $ 16 $ 6 $39 $ 6 $54 $ 6 $58 2018 Total ARR New Logo Land Net Upsell/downsell 2019 Total ARR New Logo Land Net Upsell/downsell 2020 Total ARR New Logo Land Net Upsell/downsell 2021 Total ARR New Logo Land Net Upsell/downsell 2022
Slide 36: Operating leverage from disciplined investment
15 % 16% 36 % 33% 27 % 27% 2019A 2020A 2021E 2022E G&A S&M R&D Operating leverage from disciplined investment 78 % 76 % 74% 68 % Operating Expenses 1 as % of Revenue 79 % 80% 81% 81 % 92 % 93% 93 % 93% 2019A 2020A 2021E 2022E Total Gross Margin Subscription Gross Margin Gross Margin 1 Excluding publ
Slide 37: Financial outlook
2021E 2022 E ARR Growth 44 % 32% Revenue Growth 21% 20% Adjusted EBITDA Margin 15% 18% Long Term 22 – 27% 20 – 24% 25 – 35% Financial outlook Strong operational metrics
Slide 38: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview Appendix 1 2 3 4 5 6 Table of contents
Slide 39: 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 40: Transaction overview
Transaction overview Illustrative Pro Forma Capitalization 65 % 3 % 13% 20% 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
Slide 41: 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 $300M of PIPE agreements already in place Diligence & Documentation Regulatory Review Process Shareholde
Slide 42: Table of contents
Business overview Market overview Investment highlights Transaction overview Financial overview Appendix 1 2 3 4 5 6 Table of contents
Slide 43: Financial summary – Q2
($K) June 20A June 21A ARR 109,153 158,895 YOY Growth - % 36% 46% Subscriptions 31,168 41,458 Perpetual License & Others 10,506 10,382 Professional Services 4,096 7,328 Total Revenue 45,770 59,168 YOY Growth - % 2 22% 29% Gross Profit 37,551 49,100 Gross Profit - % 82.0 % 83.0% Adjusted EBITDA 8,443
Slide 44: Financial summary – annual
($K) 2019A 2020A 2021E 2022E ARR 91,910 137,050 197,274 260,826 YOY Growth - % 28.4% 49.1% 43.9% 32.2% Subscriptions 86,647 129,745 180,876 228,500 Perpetual License & Others 59,175 42,136 26,538 20,484 Professional Services 26,032 23,032 28,223 33,816 Total Revenue 171,854 194,913 235,637 282,800 Y
Slide 45: Adjusted EBITDA reconciliation – Q2
Adjusted EBITDA reconciliation – Q2 ($K) June 20A June 21A Net Income in Financial Statements 1,963 7,796 Financial Income (1,015) (496) Tax Expenses 717 921 Depreciation & Amortization 1,506 1,699 One - time Expense (Former co - founder compensation) 1,519 - Share Based Compensation Expenses 2,127
Slide 46: Cellebrite delivers the capabilities to solve more cases with less 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 involvement 500K+ 1 C ases utilize Cellebrite’s solutions annually Time to evidence 30x+ 2 Faster time - to - collect/analyze
Slide 47: 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 Solutions 4 Solutions $21 $21 $138 2018 2019 2020 Tier 2: U.S. City PD ($K) ~7x ARR Growth 5 Solutions 12 Solutions $234 $247 $1,150 2018 2019 2020 Tier 1: Large U.K.
Slide 48: 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 49: Public safety peer benchmarking
35.5x 96.7x 75.4x 18% 18% 15% 6.4x 14.7x 13.8x Public safety peer benchmarking EV/Revenue 2022E EV/EBITDA 2022E CAGR CY20 - 22E Revenue Growth EBITDA Margin 2022E 20% 30% 19% Source: As of 8/11/21. Company filings, Wall Street Research, FactSet. Attractive valuation represents 40%+ discount to the m
Slide 50: 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 8/11/21. Company filings, Wall Street Research, FactSet. Note: ‘nm’ denotes not meaningful multiples <0x or >100x; “ na ” d
Slide 51: Operational benchmarking
18% 27% 18% 15% 5% 26% 10% 8% 8% 7% 2% 14% 6% 3% Operational benchmarking 20% 30% 29% 28% 19% 28% 28% 26% 14% 12% 9% 19% 16% 3% CAGR CY20 - 22E Revenue Growth EBITDA Margin 2022E Business Model peers Public Safety peers Median: 29% Security & Infrastructure Software peers Median: 20% Median: 16% Med
Slide 52: Valuation benchmarking
6.4x 14.7x 13.8x 12.3x 11.7x 17.5x 13.0x 9.5x 9.2x 8.5x 8.4x 17.0x 11.4x 11.1x 35.5x 96.7x 75.4x 43.3x 68.4x 82.2x Valuation benchmarking nm nm Source: As of 8/11/21. Company filings, Wall Street Research, CapIQ , Factset . Note: ‘nm’ denotes not meaningful multiples <0x or >100x. nm nm nm nm EV/Rev
Slide 53: Compelling valuation discount to high growth peers
13.8x 12.3x 14.7x 17.5x 13.0x 8.4x 9.2x 9.5x 8.5x R² = 0.326 4.0x 6.0x 8.0x 10.0x 12.0x 14.0x 16.0x 18.0x 20.0x 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 26% 27% 28% 29% 30% 31% Compelling valuation discount to high growth peers Source: As of 8/11/21. Company filings, Wal
Slide 54: 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