Slide 1: August 2023 Investor Presentation
August 2023Investor Presentation
Slide 2: Disclaimer
Disclaimer 1 Safe Harbor Disclaimer for Forward-Looking Statements This presentation has been prepared by management of System1, Inc. (together with its subsidiaries, collectively “System1”) and does not constitute a prospectus, and should under no circumstances be understood as an offer to sell or
Slide 3: Disclaimer (Continued)
Disclaimer (Continued) 2 Explanatory Note For financial reporting purposes, S1 Holdco has been determined to be the accounting predecessor and therefore its financial results are presented for all periods prior to the Business Combination with Trebia. In order to present comparable financial informa
Slide 4: Company Overview
Company Overview 3
Slide 5: System1 is a leading omnichannel customer acquisition marketing platform
System1 is a leading omnichannel customer acquisition marketing platform, delivering high intent customers to advertisers and to our own subscription products. 4
Slide 6: System1 At a Glance
Deliver high intent customers at scale Spend $625M annually (FY22) on digital advertising across all major sources of customer traffic $839 Million 2022 revenue Diversified across ~40 major advertising categories and ~2.8M paying subscribers to our digital subscription products RAMP is our technolog
Slide 7: Key Financial KPIs
Key Financial KPIs 6 ~2.8M Paying subscribers across Owned & Operated subscription products $250M FY 2022 Adjusted EBITDA (49% margin on adjusted gross profit) $121M FY 2022 Adjusted Gross Profit Note: See Appendix for a reconciliation of non-GAAP metrics to comparable GAAP metrics. Includes Protect
Slide 8: Fast Growing & Profitable
$73 $88 $121 ($11) $39 2020 2021 2022 S1 Holdco / System1 Protected.net Fast Growing & Profitable 7 $135 $167 $250 $(7) $46 2020 2021 2022 S1 Holdco / System1 Protected.net Adjusted Gross Profit $ in millions 40% CAGR Adjusted EBITDA $ in millions 39% CAGR Note: See Appendix for a reconciliation of
Slide 9: RAMP Identifies & Generates Customers Across All Major Advertising Categories
RAMP Identifies & Generates Customers Across All Major Advertising Categories & from All Major Traffic Sources 8 Platform Revenue by Vertical Note: All metrics shown are for the twelve months ended June 30, 2023. Subscription Health Finance Business & Technology Leisure & Lifestyle Travel & Tourism
Slide 10: RAMP is built for scale
108M monthly visitors1 generating 490M+ monthly sessions1 7B+ rows/day2 generated from first- party data informing our Machine Learning pipelines 94M+ daily creative & bidding optimizations2 by our automated buying engine 640M+ queries/mo. 1 powering our search stack processes across O+O and partner
Slide 11: RAMP Platform Architecture
RAMP Platform Architecture 10 Application Layer RAMP Console System1 and Network partner access to the RAMP platform, including campaign management, experimentation tools and reporting dashboards. Platform Layer Data Layer Acquisition Paid and organic traffic acquisition services & APIs. Engagement
Slide 12: How RAMP Works
How RAMP Works Identify and unlock consumer intent across all major sources of traffic 11 UNLOCK REFINE 2 MONETIZE 3 1 Refine consumer intent based on actions they take on System1 websites Monetize via advertising networks or our O&O subscription products etc. display ads 40 O&O Websites
Slide 13: REFINE
REFINE 12 Consumer intent is shaped into search intent by multiple interactions users take on our O&O sites
Slide 14: Our Technology Moat Widens as our Business Grows
Our Technology Moat Widens as our Business Grows 13 Omnichannel Vertical Agnostic Privacy Focused 1st Party Data End-to-End Tech Stack Plug & Play M&A Highly Efficient Customer Acquisition More Customer Traffic Data-Driven Optimization Better Conversion Higher Monetization & Profits Closed-Loop Attr
Slide 15: Growth Strategy
Growth Strategy 14
Slide 16: Advertising Growth Drivers
Advertising Growth Drivers 15 Continuous advertising & monetization optimizations that drive margin improvement Expand customer acquisition efforts into under indexed and new acquisition channels Grow & expand international business, currently less than 20% of platform advertising revenue Ad Rev. by
Slide 17: Subscription Growth Drivers
Su b sc ri b er s (M M ) Subscription Growth Drivers 16 Continue to test / optimize for increased renewal rates and higher ARPU Expand customer acquisition efforts via RAMP integration Launch & grow new subscription products across multiple categories and increase opportunities for cross selling Ill
Slide 18: M&A remains a Core Part of our Growth Strategy
M&A remains a Core Part of our Growth Strategy 17 Growth Focus on proprietary deals & growth synergies Accelerate Accelerate existing business lines Plug & Play RAMP is built to facilitate “Plug & Play” integration of M&A Expand Enter adjacent business markets
Slide 19: Strong and Experienced M&A Track Record
Strong and Experienced M&A Track Record 18 Growth Plug and Play Accelerate Expand Answers.com RoadWarrior CouponFollow Protected.net MapQuest Concourse Media Startpage info.com Qool Media InfoSpace
Slide 20: A Founder-led Team of Industry Veterans
A Founder-led Team of Industry Veterans 19 MICHAEL BLEND CEO & Co-Founder TRIDIVESH KIDAMBI CFO BETH SESTANOVICH Chief People Officer JEN ROBINSON CTO BRIAN COPPOLA Chief Product Officer DANIEL WEINROT General Counsel
Slide 21: @ (Sy e £ ~~ hn © a. ry) i < i |
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Slide 22: Financial Highlights
Financial Highlights 21 A diverse business model generating revenue across consumer-oriented verticals through advertising and subscriptions. Strong and consistent organic growth, our RAMP platform enables continuous optimizations driving operating leverage. Strong and Experienced M&A track record,
Slide 23: Fast Growing & Profitable
$73 $88 $121 ($11) $39 2020 2021 2022 S1 Holdco / System1 Protected.net Fast Growing & Profitable 22 $135 $167 $250 $(7) $46 2020 2021 2022 S1 Holdco / System1 Protected.net Adjusted Gross Profit $ in millions 40% CAGR Adjusted EBITDA $ in millions 39% CAGR Note: See Appendix for a reconciliation of
Slide 24: Investment Highlights
Investment Highlights 23 A fast growing and profitable business. Proven M&A capabilities with a strong track record. Proprietary RAMP platform provides a strong and sustainable competitive advantage. A highly diversified business across its marketing and monetization capabilities. Strong, industry-e
Slide 25: Thank you
24 SYSTEM Thank you
Slide 26: Appendix
Appendix 25
Slide 27: Reconciliation of Net Income to Adjusted EBITDA
Reconciliation of Net Income to Adjusted EBITDA 26 $ in millions$ in illions $ in millions i illi 01/01/22 - 01/26/22 01/27/22 - 12/31/22 Predecessor Successor S1 Holdco Net Income (Loss) $16 $33 ($37) ($442) Plus: Income Tax Expense $2 $1 ($1) ($102) Interest Expense $24 $17 $1 $32 Depreciation & A
Slide 28: Reconciliation of Revenue to Adjusted Gross Profit
Reconciliation of Revenue to Adjusted Gross Profit 27 $ in millions $ in millions $ in millions $ in millions 01/01/22 - 01/26/22 01/27/22 - 12/31/22 Predecessor Successor S1 Holdco Revenue $476 $688 $53 $774 Less: Cost of Revenue (exclusive of depreciation and amortization) ($341) ($521) ($42) ($53