Paysafe Limited · NYSE:PSFE
Paysafe — SPAC Merger (December 2020)
52 slides from Paysafe's SPAC merger presentation, December 2020
Slide 1: Investor Presentation
Investor Presentation December 2020
Slide 2: Legal disclaimer
Legal disclaimer Important Information About the Proposed Business Combination and Where to Find It In connection with the proposed business combination, a registration statement on Form F-4 (the “Form F-4”) is expected to be filed by Paysafe Limited, an exempted limited company incorporated under t
Slide 3: Presenters
Presenters Bill Foley Philip McHugh Izzy Dawood Chairman, Foley Trasimene Chief Executive Officer & Director Chief Financial Officer Bill serves as Founder and Chairman of Philip joined Paysafe in 2019 as CEO Izzy joined Paysafe in 2020 as CFO Foley Trasimene Philip has been an international
Slide 4: Transaction Overview
Transaction Overview Foley Trasimene, Blackstone, and CVC partnering to drive value ($ in millions) Pro forma valuation ($ in mm) Sources (excl. founder shares) SPAC Cash in Trust (1) $1,467 Pro Fo rm a Equity Value $7,195 Forward purchase agreement 150 PIPE investment * 2,000 Pro Forma Net Debt (3)
Slide 5: Bill Foley's value creation playbook
Bill Foley’s value creation playbook Foley will bring a team of board members to oversee transformation Strong history of value creation… Team knows how to drive revenue growth and margin expansion in payments $91.4bn Experts in payments and William P. Foley II processing $14.0bn $14.0bn Founder
Slide 6: Bill Foley is an agent of change and transformation
Bill Foley is an agent of change and transformation Revenue opportunity $140m Incremental Adj. EBITDA(1,2) $60m Incremental Adj. EBITDA incl. US iGaming upside(1,3) $75m M&A strategy Transform growth and margin Winning in US trajectory of Paysafe Total project cost Total project iGaming Balance
Slide 7: Paysafe is a highly attractive and scarce investment opportunity within Payments / FinTech
Paysafe is a highly attractive and scarce investment opportunity within Payments / FinTech with similar characteristics to other Bill Foley deals FNF investment in FIS In 2003, Bill Foley led FNF on the acquisition of Alltel Information Services for $1bn which later became Fidelity National Inform
Slide 8: 1. Introduction to Paysafe
75%+ ECOMMERCE & INTEGRATED ORGANIC REVENUE(1) 1. Introduction to Paysafe Note: eCommerce and Integrated as defined on slide 52. (1) See slide 49 for additional information regarding this non-GAAP measure.
Slide 9: Leading global pioneer in digital commerce
Leading global pioneer in digital commerce Highly differentiated B2B and B2C global network with a 1 powerful suite of digital wallet, eCash and integrated processing solutions Significant growth opportunities in massive TAM with expertise 2 in highest value verticals Long history as the global mark
Slide 10: Proprietary integrated solutions
Proprietary integrated solutions… Leading Digital Solutions Digital Wallets eCash Integrated Processing #2 Global stored value #1 iGaming eCash #4 Independent merchant Digital Wallet(1) network(4) (6) acquirer in the US Network of digital wallet solutions Proprietary digital currency Integrate
Slide 11: Attractive scale and financial profile: 2021E financial metrics and revenue mix
…with an attractive scale and financial profile Leading Digital Solutions Digital Integrated eCash Wallets Processing KPI’s 3.8m ~$1bn 12m 650k+ 250k+ 150+ Active users(1) Deposits(2) Active users(3) Distribution Merchants(5) ISV Integrations(6) points(4) Revenue Mix eCommerce & Integrated(7) Organi
Slide 12: Creating a powerful Paysafe Network
…creating a powerful Paysafe Network Leading Digital Solutions Proprietary network of digital wallet solutions eCommerce Digital solving complex Wallets commerce friction and Full stack of Integrated enabling the use of integrated Solutions global APMs commerce solutions enabling businesses
Slide 13: We are a global leader in iGaming
We are a global leader in iGaming Global Expertise Europe and Rest of World Canada United States Launched in 1999 Launched in 2010 Launched in 2013 100% of Canada iGaming Live in 12 states Global leader with over coverage – deployed Serves over 60 1,000(1) operators Paysafe Market Playbook operators
Slide 14: Global Platform integrated cloud technology
Global Platform integrated cloud technology Global Platform Unity Platform Automated underwriting Implementation of merchant risk and compliance monitoring tool Live and expansion of Single API Timing: 2020 – 2021 Cloud Integration Onboarding Reporting/ Migration of eCash processing to Clo
Slide 15: Global Platform risk & compliance
Global Platform risk & compliance Global Platform Highly developed 300+ Global Risk & Compliance Capabilities: Professionals Dedicated to Risk & Proven by Years of Successful Development in Complex Markets Compliance and Analytics U.S.: Registered with the Canada: Registered supplier in Michigan Gam
Slide 16: Paysafe Playbook expansion & M&A engine
Paysafe Playbook expansion & M&A engine Global Platform Advantaged Platform Attractive Value Benefits for Consolidation Creation Drivers Large & Diverse Pool of Large, Global & Fragmented Pool Greater Global Capabilities Opportunities for Growth of Attractive Targets to Learn Probability Digital W
Slide 17: 2. Attractive Growth Opportunities
120+ MARKETS(1) 2. Attractive Growth Opportunities (1) Based on countries from which revenue was generated in FY2019A.
Slide 18: Clear four point strategy for growth and transformation
Clear four point strategy for growth and transformation in partnership with Bill Foley M&A strategy Winning in US iGaming Accelerating existing organic revenue growth strategies Platform integration Growth strategy underpinned by weekly management discipline – Top 10 program 18
Slide 19: Opportunity to unlock over $100m adj. EBITDA in organic opportunities
Opportunity to unlock over $100m adj. EBITDA(1) in additional organic revenue(1) opportunities and cost savings over two years Enterprise Cross sell all solutions within Paysafe through a single API sales Operations Optimizing legacy processes, technology and back-office systems platform Unlocking o
Slide 20: Proven leader in iGaming, well poised for US iGaming market
Proven leader in iGaming and well poised to be successful in the highly attractive US iGaming market One-stop source Vertical knowledge Ease of integration Breadth of solution Multiple ways to pay Content / engagement Broad acceptance Differentiated wallet offering US iGaming market 60+ US $47bn (1)
Slide 21: Continue winning in high growth and profitable markets
Continue winning in high growth and profitable markets Leading capabilities positions us well… Leading digital Banking commerce Risk & regulatory Digital consumer Single integration Global footprint relationships & products and management relationships licenses APMs …to continue winning in emerging
Slide 22: Significant acquisition opportunities across all segments
Significant acquisition opportunities across all segments Over 300 specialized wallets globally which lack scale and Digital Wallet have limited capabilities consolidation − Opportunity to acquire the customer base and monetize them effectively Adding new markets and verticals Cost saving oppo
Slide 23: 3. Strong Performance & Financial Results
DOUBLE DIGIT GROWTH 3. Strong Performance & Financial Results
Slide 24: Paysafe is a compelling investment opportunity
Paysafe is a compelling investment opportunity Significant Strong Scale Growth US-listed Public Equities ~4,300 $103 billion in 2021E transactional 11% organic revenue(1) growth Significant volume CAGR 2020E-2023E Scale $1.5 billion in organic revenue in 1,483 2021E(1) Strong Growth 314 High H
Slide 25: Consistent double digit growth
Consistent(1) double digit growth Volume Organic revenue(2) ($ in billions) ($ in millions) % take rate(3): 1.41% 1.42% 1.56% 1.48% 1.43% 1.39% CAGR CAGR ’20E-’23E ’20E-’23E 13% 16% 8% 14% 15% 10% Processing Digital Wallets eCash • Double digit growth • Organic revenue(2) growth in line with histori
Slide 26: Strong operating leverage: Growth at scale
Strong operating leverage: Growth at scale Operating leverage Organic Adj. EBITDA(1) ($ in millions) Adj Opex(1)(2) as % of Organic Adj. organic 30% 32% 30% 29% 28% EBITDA 36% 34% 30% 33% 34% 36% revenue : (1) margin(1)(2): 19.6% 13.2% 11.6% 10.7% 10.4% 8.5% 5.3% 5.9% 4.6% (0.7%) 2019A 2020E 2021E 2
Slide 27: Sustainable: Highly diversified business
Sustainable: Highly diversified business Diversified by Diversified by Diversified by (1) (1) (2) (1) Segment Geography Vertical 19% 14% 30% 34% 51% 38% 30% 48% 36% Processing Wallets eCash (3) Europe North America ROW iGaming SMB Emerging Verticals 75%+ Organic revenue(4) from eCommerce and Integra
Slide 28: Sustainable: Resilient
Sustainable: Resilient Organic revenue(1) Processing indexed organic revenue in 2020(2) ($ in millions) % take rate(3): 1.42% 1.56% Digital Wallets indexed organic revenue in 2020(2) 2020E organic revenues(1) are expected to only be down eCash indexed organic revenue in 2020(2) 1% despite a 9% vol
Slide 29: Sustainable: Asset light
Sustainable: Asset light ($ in millions) 500+ bps Organic Adj. EBITDA margin(1) expansion, 2020E-2023E 80% Adj. cash conversion margin(1) (1) Adj. cash conversion(1) Organic Adj. EBITDA % Adj. cash conversion 75% 80% 80% 80% margin(1): Organic Adj. EBITDA margin(1): 30% 33% 34% 36% (1) See slide 49
Slide 30: Organic Adj. EBITDA Bridge
Organic Adj. EBITDA Bridge 2020E to 2021E ($ in millions) ~20% Organic Adj. EBITDA(1) growth 60 $561 40 13 $501 14 49 (33) $420 Organic gross profit(1) – $102 Adj. operating expenses(1) – ($21) 2020E Organic Processing eCash Digital Wallet Credit Losses Adj. Operating 2021E Organic Pro forma upside
Slide 31: Paysafe comparison versus its peers
Paysafe comparison versus its peers Integrated payments Traditional Payments eCommerce capabilities Two-sided network Vertical focus Global Risk management Note: eCommerce, Integrated as defined on slide 52. 31
Slide 32: Paysafe's valuation framework
Paysafe’s valuation framework 4 Commerce 50x+ Enablers 42% / NM 38% / NM 17% / NM 3 eComm 30x+ Leaders 19% / 35x 17% / 35x Key comparables 2 Integrated 20-30x Payments 21% / 35x 18% / 27x 15% / 25x 1 Traditional 15-20x Payments 9% / 19x 8% / 18x 7% / 16x EV / EBITDA multiple Source: Company filings,
Slide 33: Thank you.
www. paysafe .com Thank you.
Slide 34: Appendix
Appendix
Slide 35: Blackstone and CVC value creation since take-private
Blackstone and CVC value creation since take-private Net revenue has increased from $864m (2017A) to $1.4bn (2019A) since take-private, representing a 27% CAGR Invested over $250m in key platform upgrades across technology, risk and control, and product Upgraded and expanded management to begi
Slide 36: We have developed highly differentiated capabilities
We have developed highly differentiated capabilities Leading Global Global Digital Expertise Platform Solutions Proprietary Unique Smart Solutions & Reach Experience & Expertise Platform for Growth 36
Slide 37: We are well positioned for faster growth
We are well positioned for faster growth… Leading Digital Solutions eCommerce & iGaming Integrated Commerce Commerce 75%+ 34% of Paysafe’s Organic Revenue(2) of Paysafe’s Organic Revenue(2) 42% $ 58 trillion (1) potential TAM with digitized cash and APMs 12% 12% 11% 8% 6% Traditional SMBs Integrated
Slide 38: Driven by a team of experienced industry leaders
…driven by a team of experienced industry leaders Global Expertise Philip McHugh Danny Chazonoff Izzy Dawood Chief Executive Officer Chief Operating Officer Chief Financial Officer Afshin Yazdian Paulette Rowe Lorenzo Pellegrino Udo Müller CEO, US Acquiring CEO, Integrated & CEO, Skrill, NETELLER, C
Slide 39: Combined to create growth & deliver results
Combined to create growth & deliver results 1 Highly differentiated two-sided network B2C & B2B capabilities 2 Attractive Global Growth Opportunities 3 Strong Performance & Financial Results Consistent double digit organic …driving 17% organic adj. …with potential for 2x organic adj. topline growth
Slide 40: Detailed path toward organic revenue generation and cost savings
Detailed path toward organic revenue generation and cost savings In Budget ‘21 Beyond Budget ‘21 Key initiatives to be executed in 2021 Revenue Costs Revenue Costs Enterprise Cross-selling funnel Transformational deals $25 $60 sales Process transformation and automation Operations 30% reduct
Slide 41: Leading specialized Digital Wallet
Leading specialized Digital Wallet Digital Wallets Diversified network of digital wallet solutions solving complex commerce friction and enabling Digital wallets the use of global APMs 29% 2021E Enables consumers to upload, store, withdraw, Organic and pay funds from a virtual account Revenue(4)
Slide 42: Digital Wallet: Millennial and sophisticated digital consumers
Digital Wallet: Millennial and sophisticated digital consumers Specialized Wallets, Payments, and P2P transfers I’m able to upload and withdraw funds with ease. I enjoy sports betting and online poker at my favorite brands. I love to trade crypto and move money into multiple currencies. My Skrill pr
Slide 43: eCash: Bringing otherwise inaccessible consumers to high growth digital merchants
eCash: Bringing otherwise inaccessible consumers to high growth digital merchants eCash • Proprietary digital currency solutions empowering online, mobile and in-app commerce for the cash consumer eCash 21% • Enables consumers to use cash to pay for goods and 2021E services online through both a pre
Slide 44: eCash: Making Cash Available for Digital Commerce
eCash: Making Cash Available for Digital Commerce Migrating 80% of volume to account / app-based Serving Gen Z, Millennial and Underbanked consumers across 50+(1) markets I pre-buy cash vouchers to upload for online gaming upgrades. I buy online but I pay in cash at my local convenience store. paysa
Slide 45: Processing: Full stack of integrated and eCommerce solutions
Processing: Full stack of integrated and eCommerce solutions • Proprietary international gateway that can process across US, Canada and Europe Processing • Scaled distribution across the US • Leading iGaming platform with unique single API Processing integration across 3 segments 50% 2021E Organic •
Slide 46: Processing: Illustrative customer profile
Processing: Illustrative customer profile Small Merchant looking for growth Software Vendor at scale My agile dev team needs a I want a better option for my single integration through REST core merchant acquiring. APIs. My business needs smart POS I need a partner who can help solutions to let me fo
Slide 47: Operational Benchmarking
Operational Benchmarking eCommerce / Integrated Global processors Focus payments Organic Revenue(1) (2) 19% 17% 21% 18% 13% 9% growth 8% 7% (’22E/’21E) Average: 18% Average: 20% Average: 8% Organic adj. 32% EBITDA(1) (2) 20% 19% 19% 17% growth 12% 12% 9% (’22E/’21E) Average: 19% Average: 26% Average
Slide 48: Valuation Benchmarking
Valuation Benchmarking eCommerce / Integrated Global processors Focus payments EV / 2021E Organic 35x 35x 35x 27x adj. 16x (2,4) 19x 18x 16x EBITDA(1) Average: Average: Average: 35x 31x 18x EV / 2022E Organic adj. 29x 29x 26x 23x (3,4) EBITDA(1) 14x 17x 16x 15x Average: Average: Average: 29x 25x 16x
Slide 49: Non-GAAP Measures and Basis of Presentation
Non-GAAP Measures and Basis of Presentation Statement Regarding Non-GAAP Financial Measures This presentation includes Organic Revenue, Organic Gross Profit/Gross Margin, Organic Adjusted EBITDA, Organic Adjusted EBITDA Margin, Adjusted Operating Expenses, Adjusted Cash Conversion and Adjusted Cash
Slide 50: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Organic Adjusted EBITDA Organic Revenue Unaudited Unaudited Unaudited Unaudited ($ in millions) ($ in millions) 2019A 2018A 2019A 2018A Organic Adjusted EBITDA 468.6 442.0 Organic Revenue 1,389.7 1,227.4 (1) Adjustments for acquired businesses(1) - (42.1) Adjustments
Slide 51: GAAP to Non-GAAP Reconciliation (cont'd)
GAAP to Non-GAAP Reconciliation (cont’d) Organic Gross Profit 2019A (Unaudited) 2018A (Unaudited) Digital Digital ($ in millions) eCash Processing Total eCash Processing Total Wallets Wallets Organic Gross Profit $139.3 $341.4 $405.3 $886.0 $140.1 $285.1 $365.7 $790.9 Adjustments for acquired busine
Slide 52: Glossary: Summary of Definitions
Glossary: Summary of Definitions API Application Programming Interface APM Alternate Payment Methods eCommerce eCommerce refers to any transaction that significantly relies on online activity by the merchant or consumer. This includes, but is not limited to, online credit card purchases, merchant pu