September 2020 Consumer Subscription Software Insights

Important disclosures appear at the back of this report GP Bullhound LLP is authorized and regulated by the Financial Conduct Authority GP Bullhound Inc is a member of FINRA 1 Agenda

1 2020 consumer subscription software (“CSS”) insights

2 Key CSS metrics & criteria for investors

3 Building blocks of CSS companies

4 CSS CEO commentary

5 Investor interest in CSS continues to grow

6 GP Bullhound’s consumer subscription software practice

Confidential 2 Section 1 2020 consumer subscription software (“CSS”) insights

Confidential 3 GP Bullhound’s consumer subscription software practice

. GP Bullhound is a leading technology advisory and investment firm, providing transaction advice and capital to category leaders with a robust focus on Enterprise & Consumer Software globally.

. We publish this Consumer Subscription Software (“CSS”) market report to provide qualitative insights into company business models, technology and customer trends. In this report, we also feature several of the leading CSS companies & CEOs across interesting sub-sectors as well as detail interesting trends in the sector.

. Our research and report focus on software business models and content and do not include physical products or goods due to different margin and cash flow profiles.

GP Bullhound continues to be a leader in the CSS sector from both an advisory and an investment perspective:

Current Current Client Client

STREAMING ONLINE EDUCATION ACQUIRED BY INVESTMENT BY INVESTMENT BY ENTERTAINMENT PROVIDER

Capital Raise Sell-side Fund III

Current Current Client Cient

JOB SEARCH FITNESS INVESTMENT BY INVESTMENT BY INVESTMENT BY INVESTMENT BY SERVICE SUBSCRIPTION

Sell-side Sell-side Fund IV Fund IV Fund III

Confidential 4 2020 consumer subscription software perspectives

The impact of COVID and the subsequent global lockdown has allowed CSS businesses to Mental wellness apps flourish as consumers look for new ways to access content and services sessions up 66% y-o-y in May

. Vooks, a digital reading tool to encourage children to read, has seen tremendous growth as parents look for ways to entertain and educate their children at home. User growth accelerated from January levels and the company now has over 1 million teachers on the platform.

. Mental wellness apps saw an explosion of growth, according to Apptopia, as COVID caused stress while also restricting access to in-person therapy.

. With gyms closed, consumers quickly reached for new workout routines. Digital workout apps like Fiton saw paying users climb to over 100k, while demand for Peloton’s workout app and accompanying bike led to the stock doubling from February 2020.

Pressure on the Apple Store and resulting Apple tax intensifies

. Most consumers download and pay for CSS services through the two dominant App stores – Apple and Google. Apple and Google ensure that those apps are clear of malware and illegal content as well as provide distribution to billions of consumers, giving clear benefits to companies.

. However, in exchange for those services, Apple takes 30% of a first subscription and 15% of any renewals. Consequently, monopolistic complaints have been increasing and regulators are taking notice – specifically in Europe.

. The end result of any legal situation is uncertain – however, any changes to the pricing levels would be an immediate boost to CSS services, increasing profitability and generating billions of dollars to funnel into product development and consumer acquisition – fuelling growth.

. Apple’s recent legal battle with Epic games highlights the building tensions between the former partners. Education subscription services are rapidly gaining traction to improve the student experience

. Given the impact of COVID on in-person learning and classroom education, digital tools are flourishing after years of being an after thought for the majority of US schools.

. Monetization has remained a challenge given school budgets and IT restrictions (blocking YouTube).

. Recent deals have shown how CSS business models are breaking through that barrier, by selling to parents or IPO students directly: Capital Raised: $30m EV: $100m ‒ Chegg acquired Mathway, a math learning subscription tool, for $100m+ or 9x 2019 revenue Deal Date: 5/2020 Deal Date: 6/2020

‒ Quizlet raised $30m from General Atlantic at a $1bn valuation

Confidential Source: CapitalIQ, Pitchbook, GP Insights 5 INVESTORS REVIEW EACH CSS OPPORTUNITY WITH A FOCUS ON THESE KEY ATTRIBUTES CSS flywheel attributes to drive valuation

. A key valuation driver for investors is the concept of winner take all in CSS apps. If the company has the potential to dominate a niche or a broader market through network effects – investors will pay up.

. It is important for entrepreneurs to understand their competitive positioning and be able to define their market niche.

Recurring . Churn of consumer subscriptions . Intuitive UI paired with high quality will be higher than traditional Revenue content enterprise SaaS models . Design and UX is crucial to . LTV/CAC is a KPI to watch convincing the consumer of a Churn / Premium premium product Retention Content . Verticals are expanding as consumers become increasingly comfortable paying for apps CSS

. Monopoly in a small market Flywheel . User data is retained and can be lucrative Result of strong utilized within the app . Large TAM apps needs to Niche User Base performance Proprietary . Network effects from existing prove differentiation and vs. Large TAM in all the attributes Data user base, reinforcing moats (e.g. Fitness Apps) proprietary content and/or monetized data

Monetization & User Pricing Strategy Acquisition

. Creating a compelling benefit to . Efficient user acquisition and conversion with convert users from free to paid a viral element . Free to paid conversion rates are . Targeted ads, call to action, SEO, and critical KPIs sharing content has been proven successful

Confidential 6 Public investors’ excitement for CSS continues to grow

GP Bullhound has created the first consumer subscription software index to track how public CSS investments are valued

. The inaugural index includes Spotify, Match / IAC, Chegg, Intuit, Sirius XM, Shutterstock, Peloton, Gluu mobile, Netflix and DropBox. We expect to add additional companies to the index over the next 12 months (Bumble, etc).

. A few notes: − Two companies were added in early 2018 – Dropbox (March 2018), which debuted at 10.4x TEV / LTM Revenue, and Spotify (April 2018), which debuted at 5.4x − Netflix raised membership fees from $9.99 to $10.99 in Oct 2017, but still saw record-high subscribed users, beating Q4 2017 analyst estimates and boosting its share price

GP Bullhound Consumer Subscription Software Index

Source: Capital IQ, Pitchbook, company filings and publicly available data Confidential Note: Given the large market caps and high valuations of some of the businesses, the average of the EV / Rev multiples were used 7 Free+advertising vs. paid subscription – the ultimate test

Historically, investors have been conditioned to believe that consumers will always prefer a free option supported by ads vs. paying Paid vs. free . That was true in the early ages of the internet, but consumers are waking up to the pitfalls of ‘free’, including intrusive ads, the sale of personal data and poor product quality. content battles

. Pandora vs. Spotify is a great example of consumers preferring to pay for quality. Both started as free apps, using ads to generate revenue.

. However, that is where the story diverged. Spotify focused on the user experience and added features such vs. as downloading songs and playing music offline behind a subscription paywall.

. Consequently, Spotify’s amount of paid users quickly accelerated and revenue surged. Meanwhile, Pandora focused only on ads, was late to the subscription game and was ultimately sold off to Sirius. vs. 108

96 $10,855

71 vs. $7,591

48 $5,858 Spotify Paid vs. Subscription $4,556 launched 28 15 $3,288 8 $2,156 7 7 4 6 6 $1,409 $1,385 $1,467 $1,517 $1,607 $1,600 vs. $995 $921 $1,164 $425 $573 $655

2012 2013 2014 2015 2016 2017 2018 2019 2020 vs. Pandora-Revenue ($bn) Spotify-Revenue ($bn) Pandora-Paid Users (m) Spotify-Paid Users (m)

Confidential Source: Capital IQ, Pitchbook, 2020 estimates from CapIQ 8 The importance of the paywall

Success in the CSS space is heavily dependent on the placement of the paywall within the customer’s experience

. Gaining users through a ‘freemium’ offering is critical to encouraging people to try a product; however, to effectively monetize them, they need to be converted into paying customers.

. That means correctly placing the paywall at the correct point to provide the maximum value to paying subscribers but enough functionality to explore the service before paying.

Free experiences Paid experiences

. One video story . Riding leaderboards

. One free class . Download maps

. Three free books . Meditation classes

. 7-day free trial . Wearables integration

Goals Goals

1. Gain the customer contact 1. Monetize and increase customer information, download app and engagement and provide unique enter credit card details value 2. Entice interest in the product 2. Encourage sharing and create User Generated Content (“UGC”) 3. Highlight features that are included in the paid version 3. Continuously improve product to attract adjacent users

Confidential 9 Overcoming churn to build the ‘Cohort Revenue Layer Cake’

. As entrepreneurs build out their companies, they can typically invest in growth marketing or product innovation to drive retention. Which one should garner the larger share of the investment dollars? CHEETAH Thoroughbred

. Growth: Adding 10k users a month leveraging targeted marketing through . Growth: Adding 30k users a month with celebrity promoters and heavy partnerships with limited social media marketing Instagram presence . Users are leveraging the data to manage their personal health information . Usage: Limited customization of the service and a priority on notifications to and have synched its data input into their fitness tracker consume content . Cohort Churn: Retains 68% of customers by month 6 and 50+% by month 12 . Cohort Churn: Retains 40% of customers by month 6 and only 10% by month 12 (effectively having the cohort become flat)

Throughbred Cheetah 200,000 200,000 New user 105k users marketing is cut 180,000 by180,000 month 6

160,000 160,000 Long

140,000 140,000 - term valuable term valuable customers

120,00047k users by 120,000 month 6

100,000 100,000

80,000 80,000

60,000 60,000

40,000 40,000

20,000 20,000

0 0

Cohort 1/1/2020 2/29/2020 3/31/2020 4/30/2020 5/31/2020 6/30/2020 7/31/2020 8/31/2020 9/30/2020 10/31/2020 11/30/2020 12/31/2020 1/31/2021 2/28/2021 3/31/2021 4/30/2021 5/31/2021 6/30/2021 Cohort 1/1/2020 2/29/2020 3/31/2020 4/30/2020 5/31/2020 6/30/2020 7/31/2020 8/31/2020 9/30/2020 10/31/2020 11/30/2020 12/31/2020 1/31/2021 2/28/2021 3/31/2021 4/30/2021 5/31/2021 6/30/2021 7/31/2021 8/31/2021 9/30/2021 10/31/2021 11/30/2021 12/31/2021 1/31/2022 2/28/2022 3/31/2022 4/30/2022 5/31/2022 6/30/2022 7/31/2022 8/31/2022 9/30/2022 10/31/2022 11/30/2022 12/31/2022 7/31/2021 8/31/2021 9/30/2021 10/31/2021 11/30/2021 12/31/2021 1/31/2022 2/28/2022 3/31/2022 4/30/2022 5/31/2022 6/30/2022 7/31/2022 8/31/2022 9/30/2022 10/31/2022 11/30/2022 12/31/2022 Focusing on engagement and mitigating churn will result in a better long-term business than high growth and flashy advertising

Confidential Source: GP Bullhound proprietary analysis 10 Consumer subscription landscape

Entertainment

Fitness / Outdoors

BEAR Prosumer / Online EdTech Tools

Personal Finance Family

Others Health / Mindfulness FLighty (Travel, Religion, etc.) Daily Bible

Confidential 11 Usage frequency / value received vs. pricing matrix

High $160

$144 $140

$120 $120 $120 e

pric $100 $100 $100 $100

$99 scription $90 $96 ub

$80 $80 $70 ual s ual $60 $60 $60 Ann

$47 $45 $36

$40 $30 $24 Low $10

Confidential Source: Public data and GP Bullhound research 12 CSS TAM EXCLUDES GAMING PURCHASES AS WELL AS ONE-TIME APP PURCHASES The CSS TAM is expected to top $150bn by 2022

CSS TAM Analysis (1) Increases in CSS app spend per person from <$10 currently to $100+ in the US and $35 globally $150bn in CSS Spend Annually by 2022 (3)

270m US Smartphones by 2022

3.5bn Global Smartphones by 2022 (2) Proliferation of consumer subscription models in daily life

Sources: Statista, App Annie, GPB Research. Confidential (1)CSS TAM Analysis excludes mobile gaming spend (2)Global Smart phone users excludes US smart phones (3)$150bn in 2022 CSS spend equates to an average $100 annual spend per US smart phone user and $35 per global smart phone user 13 Section 2 Key CSS metrics & criteria for investors

Confidential 14 WHILE THE METRICS MEASURED MAY BE SIMILAR, CSS BUSINESSES WILL HAVE A DIFFERENT DEFINITION OF SUCCESS Enterprise SaaS vs. consumer subscription

Investors will look at many of the same investment metrics as SaaS Companies, but key nuances are important to recognize

. Higher early user churn is typically the biggest hurdle for traditional investors to overcome, but entrepreneurs can highlight low CAC and long-term retention to illustrate the staying potential of their CSS business.

Enterprise SaaS Consumer Subscription

Average Revenue Per User (ARPU) Higher

Churn Higher

Expansion Revenue Higher

Mass Market Potential Higher

Acquisition Costs Higher

Word of Mouth (WOM) Distribution Higher

Content Sharing Higher

Implementation Difficulty Higher

Enterprise SaaS Consumer Subscription

Confidential Source: CSS vs. Enterprise SaaS Framework developed in conjunction with Nicolas Wittenborn, who has written about the CSS market on Medium 15 CSS investor benchmarking criteria

CSS investors will evaluate each business based on its own unique attributes as well as sub-industry nuances, but there are industry standard metrics that help investors differentiate good businesses from great businesses

Annual User Growth Rate Gross Margins LTV / CAC

<50% 100%+ <60%+ 90% <3x 6x

1st Pay Period Free to Paid Sales Efficiency Churn Rates Conversion Rate % Ratio

>50% 20% <2% 10%+ <0.5x 2.0x

Confidential 16 KEY CSS METRICS Investors dig into key CSS metrics and KPIs

Investors will look at many of the same investment metrics as SaaS Companies, but key nuances are important to recognize

. Investors will look closely at users – including the free users, active users (MAU’s) and most importantly the paid users

Top-line Growth Metrics – . CSS top-line revenue can be measured in several ways:

User Growth & Bookings – Cash Bookings: Amounts received each month in upfront subscription payments MRR / ARR – Monthly Recurring Revenues (MRR), Annual Recurring Revenue (ARR), and GAAP revenue . Important to show continued efficient growth in top-line metrics

. Customer Lifetime Value = Number of months or years the average customer stays with the company multiplied by the ARPU times the gross profit margin %. . CSS businesses have the unique attribute in that they typically have high churn after the first pay period or trial period ends. Companies typically see churn of first time users anywhere between 20–70% of total signups. − Consequently investors are looking for retention of users AFTER the first pay period - typically the 3rd, 6th or 12th month. High retention in those periods, indicate that users are discovering value in the service and are likely to be retained long term, building the ‘CSS LTV to CAC Ratio cohort layer cake’ − Great CSS businesses renew 50%+ of each annual cohort and 40% of Year 2 . Customer Acquisition Cost (CAC) payback period is typically stated in months. Represents the time taken to fully pay back sales and marketing investment to acquire a single customer . CAC Payback of <1 month is critical to counter the high churn of initial users . 50%+ of users coming through organic channels is considered great

. Free users: Number of users who are using the platform or business. Typicaly measured monthly or MAU’s Free to Paid Conversion . Paid users: Number of users who are paying for a subscription (typically monthly or annually) Rates . Free to Paid Conversion rate: The ratio of users who start as free users and convert to paying users. This number varies by industry and type of business as well as how the benefits behind the paywall are structured and accessed

. The type of service or content being provided can vary between CSS industries. For example, exercise apps develop fitness classes at a high cost while a hiking app may be leveraging User Generated Content or UGC to enhance its offering. Gross Margins . Typically companies leveraging UGC have higher gross margins and a sustainable competitive advantage as their product and service is influenced and improved by the content and data users are generating . Investors have been proven willing to pay up for CSS businesses leveraging UGC to provide a unique service

Free cash flow / . Growth is of paramount importance, with excess cash being used to fuel growth Burn rate . Important, therefore, to understand the cash burn in the business and planning for capital efficient hyper-growth

Confidential 17 DEFINITIONS & CALCULATIONS Key CSS definitions & formulas

Metric Definition Calculation

. Normalized measurement of recurring revenue, most frequently MRR measured with a constant value in each month of the MRR = # of paying customers ∗ ARPA/month subscription period

. All S&M expenses for new customers. Sometimes excludes Customer Acquisition Cost personnel management S&M costs & CAC = (CAC) . Typically measured over a month or quarter # . Includes users acquired through free and paid channels

Customer Lifetime Value . Amount of gross profit a customer is calculated to deliver to the ∗ CLV = (CLV) company over the lifetime of the customer

. The number of months a company requires to pay back its cost Payback period Payback Period = of customer acquisition ∗

Gross Churn = . Gross Churn is the number of customers lost in a given period or cohort regardless of account expansion or growth Churn (Gross & Net) . Net Churn is the number of customers gained or lost in a given ( period or cohort after taking into consideration new, reactivated, ) or expanded accounts Net Churn =

Confidential 18 Section 3 Building blocks of CSS companies

Confidential 19 PROVIDING THE SHOVELS AND PICKAXES TO THE CSS BUILDERS The essential building blocks of subscription development

Companies are quickly building the ‘pick-axes and blue jeans’ companies of the CSS gold rush. B2B2C Tools are becoming market ready to allow niche consumer subscription companies to launch quickly

Subscription Marketing Messaging Payment Reporting & management management infrastructure processing Analytics

Confidential 20 PROVIDING CRUCIAL SERVICES TO THE CSS ENTREPRENEURS RevenueCat

|Q&A WITH THE CEO

1. Why did you start RevenueCat? I was previously an engineer at Elevate, a brain training application. We decided to launch a subscription offering and had to develop and build all the subscription tools from scratch. I knew there had to be a better solution, but nothing existed in the market.

2. Why would an entrepreneur choose to deploy RevenueCat over other offerings? RevenueCat is laser focused on being a best of breed provider for the CSS Ecosystem. We have built out tools to enable businesses to monitor and improve every aspect of their subscription offering including customer details, Miguel Carranza analytics like churn and LTV, engagement levels, in CTO addition to receiving payments. We are not a payment provider, but an entire vertical platform for CSS businesses.

Jacob Eiting 3. What does the future look like for RevenueCat? CEO Revenue Cat recently announced a $15m Series A round led by Index ventures and plans to grow from 17 employees to 40 employees shortly. In addition, the team is focused on expanding the number of CSS businesses above the 3,000 currently using the RevenueCat platform

| MISSION | LONG-TERM VISION | SCALE

To make it easy to build with in-app RevenueCat will enable the next generation of CSS businesses RevenueCat manages over $400m in subscription spend purchases, analyze your users, and to quickly scale and launch their companies by providing the through its platform and has over 3,000 apps leveraging grow your CSS business – no server tools and expertise to manage all aspects of their subscriber its platform today code required lifecycle

Confidential 21 Section 4 CSS CEO commentary

Confidential 22 STORYBOOKS BROUGHT TO LIFE Vooks

|Q&A WITH THE CEO

1. Why did Vooks use a Subscription Model vs. Free with Advertising? Vooks chose to implement the CSS business model over advertising as our research showed that people are very particular in what they purchase. Once you offer the services for free to someone – those people view that content as a commodity and it’s expected for free. That is different versus positioning it as a premium product worthy of purchase.

2. How does Vooks think about pricing? We took a very methodical approach to pricing – we wanted to price Vooks to be a premium impulse purchase – $4.99 is what people pay for a coffee. Marshall Bex 3. What is Vooks biggest challenge in acquiring CEO customers? Acquiring customers is always a challenge. Consumers can now find and consume content anywhere. So our partnerships with the schools have been very valuable as well as our limited direct to consumer marketing.

| MISSION | LONG-TERM VISION | SCALE

Transform children’s books into Inspire a lifelong love of books, reading, and great stories in As the fastest growing company in its class, it has immersive digital experiences that classrooms and among families users in 191,000 elementary schools in 175 countries promote literacy, imagination, and fun for kids of all ages

Confidential 23 JOURNALING TO HAPPINESS Reflectly

|Q&A WITH THE CEO

1. Why did Reflectly use a Subscription Model vs. Free with advertising? The journaling experience is about entertaining daily thoughts for a short period of time and Reflectly’s product is about enabling that short burst of writing. Most users typically journal for <10 minutes. Consequently, our focus is about enabling that journaling experience, not supplying advertisements.

2. How does Reflectly think about what goes in front of the paywall? We want Reflectly users to feel part of a community or an exclusive member versus just customers. Consequently, there Jakob needs to be a lot of value behind the paywall. We focus on Brøgger-Mikkelsen product to generate that trust from our members in exchange CEO & Co-Founder for a subscription. 3. What does the future look like for Reflectly? Jacob Harboe Kristensen Reflectly has an exciting path going forward. We are Co-Founder planning to offer many new services, and integrating analytics and data from wearables and other devices with the goal to make the service more personable and helpful. We will also be building up the community so we will not be reliant on paid marketing for new users. | MISSION | LONG-TERM VISION | SCALE

Reflectly is a beautiful journal and Reflectly will be a portal through which users can manage and Reflectly is the fastest growing company journaling mindfulness app driven by artificial track their overall health – with mental heath and happiness being app globally and has attracted hundreds of intelligence, with a goal to encourage just one use case thousands of paying subscribers users to journal to improve mental health and performance

Confidential 24 TRANSFORMING ONLINE INTERACTIONS THROUGH SONIC IDENTITY Voicemod

|Q&A WITH THE CEO

1. How did Voicemod acquire its user base initially? Voicemod has been around for over 10 years, gaining users organically through world of mouth and standard SEO practices by being the premier voice modification platform across multiple platforms. We recently began leveraging paid channels with a focus on YouTube.

2. How did Voicemod get free users to convert to Voicemod Pro (paid)? We offered the Pro platform for free to select users initially. We looked at users behaviour to determine what was important to them and what they used. We quickly discovered that Jaime Bosch people had certain sounds that became a part of their persona and they wanted additional customization features. Co-Founder Also,VoiceMod continues to add new content, both globally and regionally, that keep our users engaged and gaining Fernando Bosch value from their subscriptions.

Co-Founder 3. What does the future look like for Voicemod? We will continue to develop content for our passionate user Juan Bosch base, but we are excited about our expansion into mobile Co-Founder gaming, especially in Asia. Individualism is especially popular in Chinese gaming cultures and we are excited to bring our tools to the mobile market in Asia. | MISSION | LONG-TERM VISION | SCALE

Voicemod allows users to create a To allow users to evolve their online persona with the additional of Voicemod has millions of users (both free and paid) sonic identity for all of their online a “sonic identity” to compliment visual avatars and online across the globe with users conversing across communications including gaming communications multiple platforms including PC, Xbox/Playstation, and video experiences Discord, Skype and Zoom

Confidential 25 Section 5 Investor interest in CSS continues to grow

Confidential 26 Premier CSS financial investors

GP Bullhound is in constant contact with some of the worlds leading CSS financial investors and is helping shape the investment conversation

Kingdom Holding Company

Threshold Ventures

Confidential 27 VENTURE CAPITAL FOR CSS BUSINESSES Adjacent

|Q&A WITH Nico

1. Why did you decide to focus on CSS for a fund? Adjacent's focus is on mobile-first companies, but as 90%+ of top grossing apps today are subscription-based, this ends up being mostly consumer subscription software. I got there from SaaS investing with Point Nine Cap & Insight Partners, as SaaS has a similar high margin, recurring revenue business model.

Today, Apple is the most valuable company on the planet with around 40% of its profits driven by its services offering –– primarily the AppStore. Subs only launched in 2011, and I think we are still in the early innings and will see multiple $10bn+ companies built in this segment in the coming decade.

Nico Wittenborn 2. How do you pick long-term winners in CSS? A few things have to come together: efficient distribution Founder (both organic and paid), a really sticky product (over months/years, not days), some kind of defensibility (unique content, network effects, tech, etc.) – and all of this in an 'adjacent' category (benefitting from a new macro shift).

3. What are the key metrics you look at to determine | MISSION valuation? | INVESTMENTS The most important to me are: 1) growth of ARR and net new Adjacent invests up to $2m in Seed subs; 2) engagement & retention data; and 3) a unique and Series A deals across North positioning in the broader landscape with big potential. America and Europe. 4. What are the exit avenues you expect your Adjacent LP’s include institutions as investments to take? Who are the buyers? well as the founders of CSS businesses There are a lot of natural acquirers like consumer companies like Calm, Revolut and Runtastic. that are trying to shift most of their revenues from physical to digital (e.g. Nike). Furthermore, I am sure that there will be increasing PE activity in this sector as CSS businesses can be very cashflow efficient. Most importantly, I am positive that we will see the first few IPOs in this sector in the coming years.

Confidential 28 Notable subscription software M&A deals & private financings

Selected M&A and private placement transactions Selected M&A and private placement transactions

Announce Implied Announce Implied Date Target Buyer Deal Type Category Value ($m) Enterprise Value Date Target Buyer Deal Type Category Value ($m) Enterprise Value

Aug 12, 2020 M&A Online Tools Undisclosed Undisclosed May 20, 2020 PP EdTech 100.0 900.0

Health / Aug 11, 2020 PP Online Tools 15.0 60.0 Apr 29, 2020 PP Undisclosed Undisclosed Mindfulness

Aug 11, 2020 M&A Online Tools Undisclosed Undisclosed April 20, 2020 M&A Entertainment Undisclosed Undisclosed

Personal Aug 10, 2020 PP EdTech 66.0 Undisclosed Mar 6, 2020 PP 20,3 120.3 Finance

Personal Jul 29, 2020 PP EdTech 46.6 Undisclosed Mar 5, 2020 PP 700,0 6,000,0 Finance

Personal Fitness / Jul 24, 2020 PP 500.0 5,500.0 Mar 2, 2020 M&A Undisclosed Undisclosed Finance Outdoors

Health / Jul 24, 2020 Undisclosed PP 10.4 Undisclosed Mar 1, 2020 PP Dating Undisclosed Undisclosed Mindfulness

Personal Jul 17, 2020 PP EdTech 130.0 2,570.0 Feb 24, 2020 M&A 7,200.0 7,200.0 Finance

Jul 16, 2020 PP Entertainment 63.2 Undisclosed Feb 19, 2020 PP EdTech 50.0 2,050.0

Health / Jul 13, 2020 M&A Entertainment 325.0 325.0 Feb 1, 2020 PP Undisclosed Undisclosed Mindfulness

Jul 2, 2020 PP Entertainment 40.0 1,400.0 Jan 14, 2020 PP Entertainment 55.0 530.0

Personal Fitness / Jun 29, 2020 M&A 1,000.0 1,000.0 Jan 8, 2020 PP 285.0 1,035.0 Finance Outdoors

Jun 22, 2020 PP Online Tools 60.0 5,850.0 Nov 25, 2019 M&A Online Tools Undisclosed Undisclosed

Health / Fitness / Jun 10, 2020 PP 47.7 Undisclosed Nov 12, 2019 PP 55.0 237.4 Mindfulness Outdoors

Personal Health / June 9, 2020 PP 33.0 Undisclosed Sep 16, 2019 M&A Undisclosed Undisclosed Finance Mindfulness

Confidential Source: Capital IQ, Pitchbook 29 Notable subscription software M&A deals & private financings

Selected M&A and private placement transactions Selected M&A and private placement transactions

Announce Implied Announce Implied Date Target Buyer Deal Type Category Value ($m) Enterprise Value Date Target Buyer Deal Type Category Value ($m) Enterprise Value

Jul 31, 2019 PP Online Tools 135.0 1000.0 Jan 29, 2019 PP EdTech 30.0 Undisclosed

Personal Personal Jun 19, 2019 PP 50.0 285.0 Jan 28, 2019 PP 105.0 860.0 Finance Finance

Health / Jun 18, 2019 PP 3.0 Undisclosed Dec 31, 2018 M&A Dating Undisclosed Undisclosed Mindfulness

May 30, 2019 PP Online Tools 110.0 Dec 7, 2018 PP Online Tools 11.5 61.5 505.0

Health / May 29, 2019 PP 50.0 310.0 Oct 30, 2018 PP Entertainment 40.0 200.0 Mindfulness

Health / May 7, 2019 PP 2.4 Undisclosed Oct 29, 2018 M&A Dating 85.0 85.0 Mindfulness

Fashion / Apr 30, 2019 PP Online Tools 6.0 Undisclosed Oct 18, 2018 PP 59.8 Undisclosed Clothing

Health/Mindf Fitness / Apr 17, 2019 PP 5.2 30.0 Oct 11, 2018 M&A 85.0 80.0 ulness Outdoors

Health / Apr 15, 2019 M&A Online Tools Undisclosed 200.0 Aug 24, 2018 PP 25.0 125.0 Mindfulness Other / Health / Apr 9, 2019 PP Productivity 2.5 14.5 Aug 22, 2018 PP 350.0 1,500.0 Mindfulness tools

RENT THE Fashion / Mar 21, 2019 PP 125.0 1,000.0 Aug 3, 2018 PP Entertainment 23.0 Undisclosed RUNWAY Clothing

Fitness / Mar 6, 2019 M&A Undisclosed Undisclosed Aug 2, 2018 PP Entertainment 179.8 1,150.0 Outdoors

Health / Personal Feb 6, 2019 PP 88.0 1,000.0 Jul 26, 2018 Undisclosed PP 3.8 21.8 Mindfulness Finance

Personal Fitness / Feb 4, 2019 PP 50.0 950.0 Jul 25, 2018 PP 85.0 610.0 Finance Outdoors

Feb 1, 2019 M&A Entertainment 3,874.6 3,500.0 Jun 20, 2018 PP EdTech 18.8 160.0

Confidential Source: Capital IQ, Pitchbook 30 Section 6 GP Bullhound’s consumer subscription software practice

Confidential 31 CONSUMER SUBSCRIPTION MARKET INSIGHTS Consumer subscription is a focus sector for GP Bullhound

GP Bullhound research “Consumer Subscription Software Insights” – August 2019 GP Bullhound in the media

Consumer Subscription Software Insights

“We believe that the CSS business model enables companies to rapidly scale with attractive margins while also providing a compelling consumer value proposition. We are excited to help guide CSS companies through the next chapter of their evolution.”

Alec Dafferner

Selected consumer subscription credentials

Is Consumer Subscription the next software boom market?

“CSS will quickly rival enterprise SaaS as the most exciting growth opportunity in software. We are SALE OF AN EQUITY currently in the early innings of the ACQUIRED BY ACQUIRED BY ACQUIRED BY ACQUIRED BY INVESTMENT BY STAKE CSS boom as consumers, entrepreneurs, investors and Fund III companies are all waking up to the benefits and potential of the CSS business model.”

Eric Crowley

Confidential 32 Report authors

Alec Dafferner Eric Crowley Brandon Overmyer PARTNER DIRECTOR VICE PRESIDENT [email protected] [email protected] [email protected]

Daniel Roberts Minya Shidhaye Olivia Hornstein Matthew Young ANALYST ANALYST RESEARCH ANALYST [email protected] [email protected] [email protected] [email protected]

Confidential 33 We partner with global tech leaders to build the future

34 ABOUT GP BULLHOUND A leading technology advisory and investment firm

Mergers & Acquisitions Investments We are the no. 1 global advisor (1) to leading technology Through our investment team, we provide investors with access to companies in competitive international sale and acquisition category leading technology companies. processes. Our five closed-end funds have a total value of more than €280m The firm has completed 420 successful M&A transactions to date, and our limited partners include institutions, family offices and worldwide, with a total value of over $18bn. entrepreneurs.

BALTIC CLASSIFIEDS ESSENCE FILTER FALCON.IO JELLYFISH SPOTIFY SLACK MARIADB REVOLUT GLOVO GROUP

GP BULLHOUND GP BULLHOUND GP BULLHOUND GP BULLHOUND GP BULLHOUND FUND III FUND IV FUND V FUND IV FUND IV Capital Transactions Insights & Events We are a leading global advisor to companies and their owners Our events and speaking activities bring together thousands of on capital related transactions including venture capital, growth leading digital entrepreneurs and technology investors capital, acquisition funding, secondary block trades and initial throughout the year. public offerings. Our thought-leading research is read by thousands of decision- The firm has completed 120 rounds of financing for technology makers globally and is regularly cited in leading newspapers and companies to date, with a total value of $2bn. publications.

TECHNOLOGY TITANS NORTHERN INNOGAMES DELIVERY HERO ECOVADIS SIGNAVIO PRODIGY FINANCE SUMMIT INVESTOR PREDICTIONS OF TECH MARBELLA TECH AWARDS ALLSTARS

(1) League table data represents selected transaction advisors. Time period is 2016-Q4 2019. Global M&A transactions Confidential between $10m and $300m 35 Our focus sectors

SOFTWARE DIGITAL MARKETPLACES FINTECH DIGITAL MEDIA SERVICES

Confidential36 36 Joy Abiola Robert Ahldin Johannes Akermark Seth Alpert Claudio Alvarez Erik Andershed VICE PRESIDENT PARTNER DIRECTOR SENIOR ADVISOR PARTNER DATA SCIENTIST

Susanna Andersson Reda Ben Larbi Adam Birnbaum Karl Blomsterwall Elena Bocharova Bev Boettcher OFFICE MANAGER ANALYST DIRECTOR ASSOCIATE ASSOCIATE OFFICE MANAGER

Guillaume Bonneton Caoimhe Bradley Felix Bratell Joyce Byrne Hugh Campbell Jon Cantwell Charlotte Carew-Gibbs PARTNER OFFICE MANAGER VICE PRESIDENT OFFICE MANAGER MANAGING PARTNER PARTNER HR MANAGER

Ian Carroll Alessandro Casartelli Gioia Cerbelli Jack Chan Gaia Cibrario Iman Crisby Eric Crowley Jack Curran Alec Dafferner Joakim Dal Natalie Dean Carlos de la Esperanza Joaquin del Rio Briones Freddie Dodge Carolin Drewes DIRECTOR FINANCE EXECUTIVE ASSOCIATE DIRECTOR ANALYST EXECUTIVE DIRECTOR ASSOCIATE PARTNER PARTNER VP FINANCE ANALYST ANALYST ANALYST ASSOCIATE DIRECTOR DIRECTOR MARKETING

Geneshe Edelman Jennifer Eller Fraenze Gade Ravi Ghedia Hampus Hellermark Olivia Hornstein Elsa Hu Javed Huq Okan Inaltay Staffan Ingeborn Miguel Kindelán Alon Kuperman Maria Lazareva Pierce Lewis-Oakes Andrea López OFFICE MANAGER RESEARCH EDITOR VP EVENTS DIRECTOR ASSOCIATE OFFICE MANAGER EXECUTIVE DIRECTOR ASSOCIATE NON-EXECUTIVE EXECUTIVE EXECUTIVE PERSONAL ASSOCIATE DESIGN COORDINATOR DIRECTOR DIRECTOR DIRECTOR DIRECTOR ASSISTANT

Felix Lutjen Ashleigh MacDonald Manish Madhvani Marvin Maerz Alexis Majos Bulat Mardanov Victoria Martin Jaime Moreno Candice Mostisser Praveena Muthukumar Simon Nicholls Dave Nish Sandra Núñez Brandon Overmyer Adam Page ANALYST FINANCE MANAGER MANAGING PARTNER VICE PRESIDENT ANALYST ASSOCIATE PERSONAL DIRECTOR STRATEGY ANALYST VP FINANCE PARTNER VP TECHNOLOGY GRAPHIC DESIGNER VICE PRESIDENT VICE PRESIDENT ASSISTANT

Victoria Palma Ehrichs Dipam Patel Ben Prade Ed Prior Sven Raeymaekers Joel-Oskar Raisanen Julian Riedlbauer Daniel Roberts Manon Rodier Per Roman Cecilia Roman Johan Roslund Jesper Rothe Oliver Schweitzer Alexis Scorer PERSONAL VICE PRESIDENT EXECUTIVE ASSOCIATE PARTNER ANALYST PARTNER ANALYST ANALYST MANAGING PARTNER SENIOR ADVISOR VICE PRESIDENT ANALYST EXECUTIVE EXECUTIVE ASSISTANT DIRECTOR DIRECTOR DIRECTOR

Jaime Sendagorta Minya Shidhaye Kevin Siagam Joy Sioufi Sir Martin Smith Greg Smith Maria Sosna Joe Tabberer David Travis Vincent Wei Carl Wessberg Nikolas Westphal Jade Williams Evgeny Yakovlev Matthew Young VICE PRESIDENT ANALYST ASSOCIATE EXECUTIVE CHAIRMAN PARTNER OFFICE MANAGER VICE PRESIDENT GENERAL COUNSEL ASSOCIATE PARTNER EXECUTIVE PERSONAL ANALYST ANALYST DIRECTOR DIRECTOR ASSISTANT

Confidential 37 Global marquee transactions

Baltic Classifieds Group GP Bullhound Fund III EcoVadis GP Bullhound Fund III Innogames ACQUIRED BY INVESTED IN INVESTMENT BY INVESTED IN INVESTMENT BY Apax Partners Spotify CVC Growth Partners Klarna Modern Times Group

UNDISCLOSED REALISED $200M ACTIVE €260M VALUATION (DIRECT LISTING)

GP Bullhound Fund IV Jellyfish GP Bullhound Fund I Filter 13th Lab INVESTED IN INVESTMENT BY INVESTED IN ACQUIRED BY ACQUIRED BY Slack Fimalac Group Avito Merkle Facebook

REALISED £500M REALISED UNDISCLOSED UNDISCLOSED (DIRECT LISTING) (ACQUIRED BY NASPERS) Confidential 38 OUR CREDENTIALS Consumer Internet and digital content transactions

DIGITAL CONTENT

Busuu Challengermode Innogames Gamer Network Fnatic INVESTMENT BY INVESTMENT BY INVESTMENT BY ACQUIRED BY INVESTMENT BY GP Bullhound Fund IV GP Bullhound Fund IV Modern Times Group RELX Group LVL1 Group, Beringea

UNDISCLOSED UNDISCLOSED €260M VALUATION UNDISCLOSED $19M CONSUMER INTERNET Alltrails Spotify Magix AutoTrader Hitta.se ACQUIRED BY INVESTMENT BY ACQUIRED BY ACQUIRED BY ACQUIRED BY Spectrum Equity GP Bullhound Fund III Capiton Naspers Sprints Capital

UNDISCLOSED REALISED UNDISCLOSED UNDISCLOSED UNDISCLOSED (DIRECT LISTING) Confidential 39 GP BULLHOUND INSIGHTS & EVENTS Thought-leading independent technology research – connecting people in the tech industry

Titans of Tech Technology Software Digital Services Fintech PANDEMIC PROOF? PREDICTIONS GLOBAL MARKET GLOBAL MARKET GLOBAL MARKET PERSPECTIVES PERSPECTIVES PERSPECTIVES

Summit Northern Tech Investor Conference Market Update MARBELLA AWARDS ALLSTARS RECEPTIONS WEBINARS

Confidential 40 Disclaimer

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