Slide 1: Management Presentation
MANAGEMENT PRESENTATION
Slide 2: Forward-Looking Statements - Disclaimer
Forward-Looking Statements - DisclaimerCertain statements in this presentation are forward-looking statements, including our 2022 guidance. Forward-looking statements generally relate to future events including future financial or operating performance of Taboola.com Ltd. (the “Company”). In some ca
Slide 3: Today's Presenters
TODAY’S PRESENTERS ADAM SINGOLDAFOUNDER & CEO STEPHEN WALKERCFO Founded Taboola over 13 years ago Has led the company as its CEO ever since 6+ years at TaboolaLed several of Idealab's portfolio companies, including Perfect Market Prior experience at Disney & General Electric
Slide 4: Agenda
AGENDA Taboola Overview/ 2021 in review Capturing a$64b market Taboola’s differentiation and why we win 1 2 3 Strong financial model 4
Slide 5: Powering Recommendations for the Open Web
POWERING RECOMMENDATIONS FOR THE OPEN WEBHELPING PEOPLE DISCOVER THINGS THEY MAY LIKE
Slide 6: Taboola = Search "In Reverse"
TABOOLA = SEARCH “IN REVERSE” FROM PEOPLE LOOKING FOR INFORMATIONTO INFORMATION LOOKING FOR PEOPLE
Slide 7: You Have Seen Taboola Before
YOU HAVE SEEN TABOOLA BEFORE
Slide 8: Solving Tremendously Difficult Technological Challenges
SOLVING TREMENDOUSLY DIFFICULT TECHNOLOGICAL CHALLENGES Predicting what people might be interested in without the intent data that Google has or the personal data that Facebook has and doing it at massive scale. 516M DAILY ACTIVE USERS1 More than Twitter and Snapcombined2 1 PetabyteData Processed by
Slide 9: $2B+ Paid to Publishers Over Years
$2B+ PAID TO PUBLISHERS OVER 3 YEARS1 Publishers on a 5+ Year Contract with Taboola FULL TECH STACK FOR PUBLISHERS:LONG-TERM, EXCLUSIVE PARTNERSHIPS WITH PREMIUM PUBLISHERS 116%NDR in 20211 9,000publisher GLOBAL (1) Source: Company Data. Net Dollar Retention (ex-TAC Gross Profit) is the net growth o
Slide 10: Advertisers Choose Taboola to Reach the Open Web
ADVERTISERS CHOOSE TABOOLA TO REACH THE OPEN WEB Massive reach 516M Daily Active Users1 Performance focus with measurable ROIBrand safe ad placements Target ads based on what people truly care about Largest advertiser is 2% of total adspend1 10th largest advertiser is 1% of total adspend1101% Net Do
Slide 11: 2021 in Review - Signed Incredible Partnerships
2021 IN REVIEW - SIGNED INCREDIBLE PARTNERSHIPS Winning and building partnerships with exciting new publishersBBC, Hearst, Penske Media, Line TodayRenewing and extending long term relationshipsNew contract with Microsoft through July 2024Global deals including 5 year renewals with both Le Figaro and
Slide 12: 2021 in Review - Game Changing Product Innovations
2021 IN REVIEW – GAME CHANGING PRODUCT INNOVATIONS Launched High Impact Placements bringing Taboola into mid-article, driving Brands & Agencies to 15% of RevenuesIntroduced SmartbidDimensions using A.I. to couple contextual and demographic data with more user dimensions to maximize advertiser campai
Slide 13: 2021 in Review - Extending Leadership in Brand Safety
2021 IN REVIEW – EXTENDING LEADERSHIP IN BRAND SAFETY Attained in Q3 Trustworthy Accountability Group (TAG) brand safety certificationAnnounced a new partnership with DoubleVerify (DV) to embed DV’s pre-bid brand safety and suitability targeting technologyPartnered with Oracle Moat to introduce vide
Slide 14: 2021 in Review - Connexity Acquisition
2021 IN REVIEW -Connexity Acquisition Acquired Connexity, creating a powerful e-Commerce partner for publishersHigh trust with merchants: 90%+ of revenue from direct relationships, 65% is CPCAnticipated Synergies: $100M+ Annual ex-TAC in 4 yearsUnique, scaled platform: 1,600+Direct Merchant Relation
Slide 15: 2021 in Review - Taboola News
2021 IN REVIEW –Taboola News Breakout year for Taboola News Samsung Brazil partnership, integrating content from Taboola’s premium publishers on Samsung devicesGlobal partnership with Xiaomi, 100 million mobile devices in 60 marketsAveraging more than 400 million monthly engagements on editorial con
Slide 16: Increased Guidance After Each Quarter
INCREASED GUIDANCE AFTER EACH QUARTER $1,378M Revenues $519M ex-TAC Gross Profit1 2021 (1) Non-GAAP measures, see appendix for reconciliation to GAAP $179M Adj. EBITDA1 $1,277M $445M ORIGINAL PIPE EXPECTATIONS $127M 16% 36%2 GROWTH RATE 69% $441M Gross Profit $365M 38% CONSISTENTLY EXCEEDED 2021 FIN
Slide 17: Momentum Continues into 2022
before net financial expenses income tax expenses/ FY 2022GUIDANCE GROWTH RATE VS 2021 Revenues $1,666 - 1,678M 21 - 22% Gross Profit $552 - 560M 25 - 27% ex-TAC Gross Profit1 $661 - 669M 27 - 29% Adj. EBITDA1, 2 $195 - 213M 9 - 19% MOMENTUM CONTINUES INTO 2022Fast Growth | 30%+ Adj. EBITDA Margin |
Slide 18: Agenda
AGENDA Taboola Overview/ 2021 in review Capturing a$64b market Taboola’s differentiation and why we win 1 2 3 Strong financial model 4
Slide 19: Taboola's Differentiation and Why We Win
TABOOLA’S DIFFERENTIATION AND WHY WE WIN Growth fuelled by a network effect Long-term yield increase opportunity Taboola’s technology is resilient to the future disappearance of third-party cookies Platform advantage driven by Taboola’s technology Proven, founder-led management team Superior financi
Slide 20: Scale Matters - Growth with a Built-in Network Effect
SCALE MATTERS IN OUR INDUSTRY- GROWTH WITH A BUILT-IN NETWORK EFFECT More publisher partners More users reached More Data Generated More advertisers More Successful Higher yield (Better Results for Advertisers and Publishers) 1
Slide 21: What Makes Up Yield
WHAT MAKES UP YIELD 2 Click Through Rate (CTR): The number of clicks that an ad receives divided by the number of times the ad is shown (impressions)A high CTR is a good indication that users find your ads relevant Cost Per Click (CPC):The amount advertisers pay for each click on their ads. Conversi
Slide 22: How We Increase Yield
CTR and ConversionsClick Through Rate, Conversion Rates CPCCost Per Click HOW WE INCREASE YIELD 2 Algorithmic improvements drive better prediction of what users will engage withMore advertisers on the platform and higher diversity of campaignsMore data that provides more contextual signals enables m
Slide 23: Taboola Tech Is Built for a Cookie-less, IDFA/ATT World
TABOOLA TECH IS BUILT FOR A COOKIE-LESS, IDFA/ ATT WORLD (1) Source: Company data. Clicks represent total clicks on Taboola recommendations, including paid advertisements (“sponsored content”) and editorial ("organic") content Taboola has its own 1st party cookie - recommending personalized editoria
Slide 24: Platform Advantage Driven by Investment in Tech
500R&D staff 100in Algo & Data $100M+Annual R&D Investment PLATFORM ADVANTAGE DRIVEN BY INVESTMENT IN TECH 4
Slide 25: Proven, Founder-Led Management Team
PROVEN, FOUNDER-LED MANAGEMENT TEAM KRISTY SUNDJAJASVP, People Operations1 year at Taboola ADAM SINGOLDAFounder & CEO13 years at Taboola STEPHEN WALKERCFO6 years at Taboola ELDAD MANIVPresident & COO8 years at Taboola LIOR GOLANCTO11 years at Taboola AVIV SINAI SVP, R&D13 years at Taboola RAN BUCK S
Slide 26: Superior Financial Model
FY 2022GUIDANCE GROWTH RATE VS 2021 Revenues $1,666 - 1,678M 21 - 22% Gross Profit $552 - 560M 25 - 27% ex-TAC Gross Profit1 $661 - 669M 27 - 29% Adj. EBITDA1 $195 - 213M 9 - 19% SUPERIOR FINANCIAL MODELFast Growth with 30%+ Adj. EBITDA Margin and Strong Cash Generation Ratio of Adj. EBITDA to ex-TA
Slide 27: Agenda
AGENDA Taboola Overview/ 2021 in review Capturing a$64b market Taboola’s differentiation and why we win 1 2 3 Strong financial model 4
Slide 28: Taboola Is Poised to Capture Share of the $64B Open Web Market
TABOOLA IS POISED TO CAPTURE SHARE OF THE $64B OPEN WEB MARKET More than ads, product led - driving engagement, and audience to the entire publisher orgExclusive & direct relationships with publishers/advertisers - enables end-to-end innovation and predictable growth1st party & contextual data, buil
Slide 29: Recommending Anything, Anywhere
RECOMMENDING ANYTHING, ANYWHEREA MULTI BILLION DOLLAR OPPORTUNITY Core Business $1B+ in 2021 & Growing Rapidly2 A N Y T H I N G $100M’s in 20213 $10M’s in 20211 New products and segments (TV ads, eCommerce, app downloads, gaming...) A N Y W H E R ETaboola News (mobile carriers, device manufacturers,
Slide 30: Winning $64B Core Market
Winning $64B Core MarketReplacing Traditional Ads With Taboola Recommendations Amazon recommending products - some are organic, some are paid. Similar to Taboola recommendations
Slide 31: Recommending Anything: E-Commerce with Connexity
RECOMMENDING ANYTHING: E-COMMERCE WITH CONNEXITY(15% of ex-TAC Gross Profit as of Q4 2021)
Slide 32: Connexity Acquisition
Connexity AcquisitionOne of the largest e-Commerce media platforms in the world $800 million Total ConsiderationIncluding purchase price and retention incentives Closed September 1, 2021 Primarily a cash transactionApproximately: $260M cash from balance sheet$300M committed debt financing$240M in Ta
Slide 33: The Future of the Open Web Is E-Commerce
THE FUTURE OF THE OPEN WEB IS E-COMMERCE $1b GMS in 2020, 47% of H1 2021 media revenue, 56% YoY growth $500m GMS in 2020,ecommerce to be 31% of revenue by 2024 $1b GMS in FY 2021,over 25% YoY growth in related revenue Reviewed.com - 50% YoY top line growth for the last 3 years 33 Source: eMarketer,
Slide 34: E-Commerce and How We Serve Merchants in the Open Web
RECOMMENDING ANYTHING: E-COMMERCE AND HOW WE SERVE MERCHANTS IN THE OPEN WEB MERCHANTS Audience Network (Walled Gardens) Search Social Publishers SolutionsMonetized Links in Editorial Content Product Listings in Shopping Experiences WALLED GARDENS OPEN WEB
Slide 35: Expanded Taboola TAM to $124B with E-Commerce Ad Budgets
OPEN WEB - $64B e-Commerce - ~$40B e-Commerce - ~$60B WALLED GARDEN - $260B $64B+$60B=$124B TAM MERCHANTS NEED EFFECTIVE CHANNELS BEYOND THE WALLED GARDENS.“For advertisers seeking brand-safe, transparent partners, reputable publishers deliver exposure and qualified customers from among their audien
Slide 36: Connexity on Taboola Publishers - Anticipated Synergies
Connexity on Taboola Publishers - and grow publishers % of traffic with intentTake Connexity GlobalConnexity merchant demand on Taboola publisher supplyExpanding Connexity’s Client base by Leveraging Taboola Ad SalesBetter personalization/yield by merging datasets - recommendations + e-commerce ANTI
Slide 37: Strong Initial Integration Momentum
People - London office locations merged; NY planned in H1-2022. Complementary teams sharing info, tools, and resources.Ad Sales - Beginning global expansion of Connexity via Taboola’s international ad sales teams (first in China, Brazil)Publishers - started upselling to Taboola publishers, and build
Slide 38: Recommending Anything: Brands & Agencies
RECOMMENDING ANYTHING: BRANDS & AGENCIES(~ 15% of ex-TAC Gross Profit as of Q4 2021)
Slide 39: Taboola High Impact
TABOOLA HIGH IMPACTA premium solution for achieving brand awareness Premium Ad Placements & ExperiencesBrand Safety & Adjacency ControlUnique Readership Data & Insights
Slide 40: Recommending Anywhere: Taboola News
RECOMMENDING ANYWHERE:TABOOLA NEWS
Slide 41: Anywhere: Taboola News
ANYWHERE: TABOOLA NEWS 41 BRINGING PREMIUM CONTENT TO PEOPLE EVERYWHERETaboola News delivers relevant content from our premium publisher partners, integrated into mobile phones and other user touchpoints.It creates new opportunities for engagement and revenue for mobile carriers, device manufacturer
Slide 42: Agenda
AGENDA Taboola Overview/ 2021 in review Capturing a$64b market Taboola’s differentiation and why we win 1 2 3 Strong financial model 4
Slide 43: Taboola Focuses on Profitable Growth
TABOOLA FOCUSES ON PROFITABLE GROWTH1 Upside in our modelGrowth from Core Open Web business onlyConservative growth assumed for existing baseAdditional upside from existing growth initiatives and inorganicLong-term model 20%+ ex-TAC Gross Profit Growth30%+ Ratio of Adjusted EBITDA to ex-TAC Gross Pr
Slide 44: COVID-19 in 2020 Proved the Resiliency of Our Model
COVID-19 IN 2020 PROVEDTHE RESILIENCY OF OUR MODEL RELENTLESS FOCUS ON YIELDS… … COMBINED WITH HISTORICALLY LOW COSTS EXITED 2020 STRONGER THAN WE ENTERED WITH SUSTAINABLY HIGHER PERFORMANCESustainable yield increase, driving higher margins Yield is a normalized measure of performance that controls
Slide 45: Growth Driven by Core Open Web Installed Base
1 2 GROWTH DRIVEN BY COREOPEN WEB INSTALLED BASE CONTINUED GROWTH FROM NEW SUPPLY... …HELPS PROVIDE FUEL FOR GROWTH FROM A STRONG INSTALLED BASE. New digital property partners within the first 12 months that were live on our networkNet Dollar Retention (ex-TAC Gross Profit) is the net growth of ex-
Slide 46: Selected Non-GAAP Metrics
SELECTED NON-GAAP METRICS ADJ. EBITDA1($ in millions) 2020A 2021A $106M $382M $179M $519M (1),(2),(3),(4) Adj. EBITDA, ex-TAC Gross Profit, and Ratio of Adj. EBITDA to ex-TAC Gross Profit, and Adj. Gross Profit Margin are Non-GAAP measures, see appendix for reconciliation to GAAP. Adj. Gross Profit
Slide 47: Thank you.
Thank you. 47
Slide 48: Appendix
TabOela APPENDIX
Slide 49: Our Model in a Nutshell
OUR MODEL IN A NUTSHELL 49 Revenues(1) Traffic Acq Cost (Value to publishers) ex-TAC Gross Profit(2) Cost of Revenues Gross profit R&D S&M G&A Operating Income $909 ($627) $282 ($48) $234 ($73) ($110) ($34) $17 $1.00 (100%) ($0.69) $0.31 ($0.05) $0.26 ($0.08) ($0.12) ($0.04) – = – = – – – = Model co
Slide 50: Historical & Projected Revenues & ex-TAC Gross Profit
HISTORICAL & PROJECTED REVENUES & EX-TAC GROSS PROFIT1 (REPORTED BASIS) 50 (1) Non-GAAP measure, see appendix for reconciliation to GAAPNote: 2022 projections reflect the mid-point of current company guidance.
Slide 51: Key Model Assumptions
KEY MODEL ASSUMPTIONS ex-TAC Gross Profit1Historically, Taboola grew 20%+ (CAGR ’17-’21)In 2021, Taboola generated $519 million ex-TAC Gross ProfitFor FY 2022, the Company expects ex-TAC Gross Profit in range of $661 - 669M ADJUSTED EBITDA2$179 million in 2021 and growing faster than ex-TAC Gross Pr
Slide 52: Selected GAAP and Non-GAAP Metrics
SELECTED GAAP AND NON-GAAP METRICS 52 (1)Non-GAAP measures, see appendix for reconciliation to GAAPNote: 2022 projections reflect the midpoint of current company guidance.
Slide 53: FY 2022 Guidance
(1) Non-GAAP measure, see appendix for reconciliation to GAAP FY 2022 GUIDANCE 53 1 2 (1) 1 1
Slide 54: Additional Modeling Assumptions
ADDITIONAL MODELING ASSUMPTIONS Interest expense of approximately $3.5M per quarter associated with $300M term loan related to the Connexity acquisitionShare based compensation of $128M in 2021 unusually high as a result of going public triggering event, 2022 estimated at $83MDepreciation & Amortiza
Slide 55: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION 55 Note: Although we provide guidance for Adjusted EBITDA, we are not able to provide guidance for projected Net income (loss), the most directly comparable GAAP measures. Certain elements of Net income (loss), including share-based compensation expenses, are not predi
Slide 56: 2021 Quarterly Results: Adjusted EBITDA Reconciliation
2021 QUARTERLY RESULTS: ADJUSTED EBITDA RECONCILIATION 56 1A substantial majority is Share-based compensation expenses related to going public.2 Relates to the acquisition of ION Acquisition Corp. 1 Ltd. and going public. 1 2
Slide 57: ex-TAC Gross Profit Reconciliation
EX-TAC GROSS PROFIT RECONCILIATION 57 Note: 2022 projections reflect the midpoint of current company guidance.
Slide 58: Ratio of Adjusted EBITDA to ex-TAC Gross Profit Reconciliation
RATIO OF ADJUSTED EBITDA TO EX-TAC GROSS PROFIT RECONCILIATION 3
Slide 59: ex-TAC Gross Profit Margin Reconciliation
EX-TAC GROSS PROFIT MARGIN RECONCILIATION 59
Slide 60: Historical & Projected Adj. Gross Profit Margin Reconciliation
HISTORICAL & PROJECTED ADJ. GROSS PROFIT MARGIN RECONCILIATION Note: Adj. Gross Profit Margin is calculated by dividing Gross profit by ex-TAC Gross Profit. 2022 projections reflect midpoint of company’s current guidance. 60
Slide 61: Historical Free Cash Flow Reconciliation
HISTORICAL FREE CASH FLOW RECONCILIATION (1) Adj. EBITDA Plus the change in working capital reflects the Net cash provided by operating activities. For estimated periods, Net cash from operating activities assumes 53-57 days payables outstanding and 40-45 days sales outstanding.61
Slide 62: Consolidated Balance Sheet
CONSOLIDATED BALANCE SHEET ($ in millions) As of Dec 31, 2019 As of Dec 31, 2020 As of Dec 31, 2021 Cash, cash equivalents and short-term deposits $ 116 $ 243 $ 319 Total Assets $ 482 $ 580 $ 1,598 Total Liabilities & Convertible Shares $ 475 $ 534 $ 830 Accumulated Deficit $ (40) $ (31) $ (56) Addi
Slide 63: 2021 Quarterly Results: ex-TAC Gross Profit Reconciliation
2021 QUARTERLY RESULTS:EX-TAC GROSS PROFIT RECONCILIATION 63
Slide 64: 2022 Full Year Guidance: ex-TAC Gross Profit Reconciliation
2022 FULL YEAR GUIDANCE:EX-TAC GROSS PROFIT RECONCILIATION 64
Slide 65: Thank You!
Z Z THANK YOU!