Bakkt, Inc. · NYSE:BKKT
Bakkt — SPAC Merger (January 2021)
34 slides from Bakkt's SPAC merger presentation, Jan 11, 2021
Slide 1: Bakkt Victory Park Capital
Bakkt VICTORY PARK CAPITAL
Slide 2: Important Notice Disclaimer
Important Notice Disclaimer This investor presentation (this “Presentation”) is for informational purposes only to assist interested parties in making their own evaluation with respect to the proposed business combination (the “Business Combination”) between VPC Impact Acquisition Holdings (“VIH”) a
Slide 3: Today's Presenters
Today’s Presenters â–ª Previously Head of Technology at Citi’s Global Consumer Bank from 2016 to 2020 33 â–ª Head of Digital at Chase from 2013 to 2016 Gavin Michael â–ª Chief Innovation Officer of Accenture from 2010 to 2013 Chief Executive Officer years â–ª Chief Information Officer of Lloyd’s Ban
Slide 4: Overview of Victory Park Capital (VPC)
Overview of Victory Park Capital (VPC) VPC Impact Acquisition Holdings (VIH) was sponsored by VPC Bakkt is an ideal partner for VIH Established Alternative Investment Manager meeting our key acquisition criteria • Founded in 2007, Victory Park Capital (VPC) is a privately held SEC-registered(1) glob
Slide 5: Transaction Summary
Transaction Summary Transaction Highlights • VPC Impact Acquisition Holdings (Ticker: VIH), a Cayman Islands company, is a FinTech-focused publicly traded Special Purpose Acquisition Company (SPAC) with $207 million in cash to be deployed • VIH has entered into a definitive agreement to combine with
Slide 6: Overview of ICE
Overview of ICE • ICE has a market cap of $65 billion(1) and is a global market infrastructure provider with a history of developing and implementing leading technologies • ICE operates exchanges, clearinghouses, and listing venues for the financial markets alongside offering data-driven technology
Slide 7: Bakkt Has Strong Institutional Support
Bakkt Has Strong Institutional Support • Bakkt is currently 81%(1) owned by ICE but also maintains marquee strategic and venture capital stakeholders including Boston Consulting Group, Microsoft’s M12, Starbucks and PayU • In building this platform, ICE and minority investors have contributed more t
Slide 8: Investment Highlights
Investment Highlights 1 Unlocking massive market by empowering monetization and adoption of digital assets Increased digital adoption + embedded finance 2 Transformative consumer marketplace with internet economics Commerce enablement + payments + markets = integrated & extensible platform 3 A trife
Slide 9: Digital Assets Driving a New Dynamic Economy
Digital Assets Driving a New Dynamic Economy New, Emerging Economy Digital Assets + High TAM(1) valuation with significant Digital currency growth Scope (for payments) + Empowerment of consumer A digital asset is a Loyalty points/miles store of value that can + Increase in digital assets used as be
Slide 10: Large and Growing Market
Large and Growing Market Massive SAM(1)… …With an “Unbounded” TAM(2) ~$5.1tn $3tn ~$1.6tn (4) International Cryptocurrency $703bn $1.4tn Gift Cards(3) Increased asset class digitization Gift Cards(3) $599bn $564bn Cryptocurrency (4) Increased retail participation Loyalty $316bn Points/Miles(5) Loyal
Slide 11: Bakkt Is Unlocking The Value of Captive Digital Assets for Everyday Use
Bakkt Is Unlocking The Value of Captive Digital Assets for Everyday Use Key Challenges Value Unlocked by Bakkt Untapped captive value Digital assets as new types of currency Potential not fully leveraged Increasing use as tender for payments Limited fungibility of digital assets Exchange not commodi
Slide 12: Introduction to Bakkt
Introduction to bakkt
Slide 13: Bakkt at a Glance
Bakkt at a Glance A digital asset marketplace with broad application History & Background Value Proposition Founded in 2018 to bring trust and transparency to Empowers consumers to use digital assets their digital assets for everyday $880+ million of capital and assets invested to date spending Star
Slide 14: Intuitive Consumer User App Interface Demo
Intuitive Consumer User App Interface Demo
Slide 15: Seamless Aggregation, Conversion and Monetization of Digital Assets
Seamless Aggregation, Conversion and Monetization of Digital Assets for Everyday Use Aggregat e Convert Spend Digit al Asset s Among Asset s Anywhere In- Game Pay In- st ore Crypt o Miles Purchase Online Rewards Cash Redeem Equit ies P2P 15
Slide 16: Competitive Edge in an Already Disruptive Ecosystem
Competitive Edge in an Already Disruptive Ecosystem Bakkt is competitively advantaged against peers, creating a sustainable moat Key Bakkt Differentiators $38BN(1) Founded 2013 • Regulated platforms across trading, clearing, custody and payments build confidence and instill $12BN(3) $20BN(1) trust a
Slide 17: More Capabilities Than Current Competitors
More Capabilities Than Current Competitors (1) Digital Asset Aggregation ✓ Digital Asset Native ✓ Apple™ Rewards ✓ Store Value Card Reload ✓ ✓ ✓ ✓ Gift Card Rewards/Sales ✓ ✓ Travel Redemption ✓ Loyalty Aggregation ✓ ✓ Pay with Points ✓ ✓ Crypto Wallet ✓ (2) ✓ ✓ ✓ ✓ Bid/Ask Crypto Exchange ✓ ✓ ✓ ✓ D
Slide 18: Regulated, Secure and Trusted Crypto Custody
Regulated, Secure and Trusted Crypto Custody Bakkt’s trusted digital asset ecosystem, leveraging ICE’s robust platform of security protocols, makes Bakkt the preferred marketplace for a growing number of institutional Bitcoin investors Institutional-Grade Custody SOPHISTICATED MULTI-ZONE PHYSICAL CY
Slide 19: Unparalleled Infrastructure
Unparalleled Infrastructure REDEEM & CONVERT SPEND & PAY SEND TRADING(1) direct pay / virtual travel direct payments mobile / web apps bitcoin cash futures options card “white label” digital asset loyalty points and (2) redemption deals & rewards “powered by” aggregation & gift cards securities rewa
Slide 20: Value Creation Driven by Partnerships
Value Creation Driven by Partnerships Fully Integrated Partially Integrated In Advanced Discussions Confirmed Strategic Interest Financial Institutions • Apple • Remaining 4 major US Airlines • 3 of the top 5 US Financial 3 of the • largest Hotel Loyalty Institutions • 200+ gift card merchants Partn
Slide 21: Multiple Sources of Revenue
Multiple Sources of Revenue Bakkt has a diverse revenue generation model that can monetize transactions through multiple revenue streams Payments Trading Conversion P2P Merchant Discount Rates Contract Value Spread Transaction Fees Transaction Fees Spread Transaction Fees Spread Subscription Fees Tr
Slide 22: Powerful Flywheel Effect
Powerful Flywheel Effect â–ª Increased program engagement and new engagement opportunities â–ª Unlock value of captive assets â–ª More redemption options for customers at a lower cost to partners â–ª Digital asset aggregation and increased spending power â–ª Loyalty liability optimization Single int
Slide 23: Tangible Growth Opportunities
Tangible Growth Opportunities User growth Increased Partnerships International New products Data usage and expansion and platform monetization technology enhancements adoption Near-term markets: Canada Crypto lending / Australia digital asset collateralization UK 23
Slide 24: Seasoned Leadership Team
Seasoned Leadership Team Gavin Michael Incoming CEO Gavin Michael joins Bakkt from Citi, where he had Nicolas Cabrera Nicolas serves as Bakkt Chief Product Officer, responsible for leading Chief Executive Officer been the Head of Technology at Citi’s Global Consumer Bank since Chief Product Officer
Slide 25: Financial Performance
Financial Performance
Slide 26: Compelling Projected Financial Profile
Compelling Projected Financial Profile (1) (1) Customer Active Users Unique Sign-Ups Active User Growth (2) Acquisition Cost (2025E) (through 2025E) (2021E – 2025E CAGR) (2025E) 30+ million 46+ million 36% ~$7 Total Revenue Less Total Revenue Less Total Revenue per (1) Transaction-Based Transaction-
Slide 27: Projected User Growth
Projected User Growth Conservative growth assumptions given increasing digital asset adoption today versus 2015 active users (M)(1) active users (M) active users (M) 31 13 30 27 10 24 23 18 6 15 9 3 7 1 3 < 1 1 0 2020 2021E 2022E 2023E 2024E 2025E 2015 2016 2017 2018 2019 1H 2020 2015 2016 2017 2018
Slide 28: Projection Summary
Projection Summary Projected Financials CAGR ($ millions) 2021E 2022E 2023E 2024E 2025E ‘21E—‘25E Transaction(1) $16 $137 $234 $294 $351 Crypto Buy/Sell(2) 849 2,863 4,413 5,410 6,206 Subscription and Services 22 26 29 30 32 Other 1 4 6 7 8 Total Revenue $889 $3,030 $4,681 $5,741 $6,597 65% % YoY Gr
Slide 29: Strong Unit Economics
Strong Unit Economics Annual Cohort Customer Acquisition Cost (CAC)(1) Average Total Revenue Per Monthly Active User(2) $206 $210 $198 $15 $165 $11 $12 $10 $8 $97 $7 $10 2020 2021E 2022E 2023E 2024E 2025E 2020 2021E 2022E 2023E 2024E 2025E Note: Figures are based on management’s estimates. Projectio
Slide 30: Investment Plan
Investment Plan Projected Operating Expenses ($ millions) 2021E 2022E 2023E 2024E 2025E Personnel(1) $103 $120 $129 $141 $156 Marketing 106 117 102 65 60 Technology 19 26 31 33 36 D&A 20 41 54 56 46 Other(2) 11 12 15 18 21 Total $259 $316 $331 $314 $320 Commentary • Investment focused on data & anal
Slide 31: Transaction Summary
Transaction Summary
Slide 32: Illustrative Transaction Overview
Illustrative Transaction Overview ($millions, except per share figures) Sources & Uses(1) Pro Forma Valuation(1) Sources Amount % Particulars Amount Cash Held in SPAC Trust $207 8% Share Price $ 10.00 Pro Forma Shares Outstanding 267 Issuance of Shares to Target 2,082 80% Pro Forma Equity Value $2,6
Slide 33: Growth and Margins Compare Favorably to Peers
Growth and Margins Compare Favorably to Peers Revenue Growth CAGR (’20E-’22E) 75.2% 57.9% 36.3% 29.4% 18.5% B ‘25) (1) S ’21E-’25E CAGR Total Revenue Less Transaction-Based Expenses ’21E Adjusted EBITDA Margin(2) 55.3% 29.8% 16.1% 17.0% 12.7% B 5) (1) S ’25E EBITDA Margin(2) Source: Wall Street rese
Slide 34: Peer Valuation Perspective
Peer Valuation Perspective Enterprise Value ($millions) $275,159 $137,403 $117,724 $25,564 S EV / ’21E Revenue 35.4x 27.3x 26.6x Median: 27.0x 10.9x (1) S EV / ’21E Adjusted EBITDA(2) 278.0x 170.2x 156.1x Median: 163.1x 36.7x S Source: Market data as of January 8, 2021. Note: Peers are (as shown fro