Vivid Seats Inc.

Good morning and welcome to the Vivid Seats fourth quarter and full year 2021 earnings conference call. Following management's prepared remarks, we will open the call for today. I would now like to turn the call over to Kate Coppolis. You may begin.

Good morning and welcome to Vivid Seats fourth quarter and full year 2021 earnings conference call. I'm Kate Copples, Head of Investor Relations at Vivid Seats. Joining me today to discuss Vivid Seats results are Stan Chia, Chief Executive Officer, and Larry Fay, Chief Financial Officer. By now, everyone should have access to the company's fourth quarter and full year earnings press release filed earlier this morning. We have also provided supplemental earnings slides. The press release and earnings slides are available on the Investor Relations page of Vivid Seats website at investors.vividseeds.com. During the course of this call, management may make forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to the risks and uncertainties as described in the company's earnings press release and other filings with the SEC. On today's call, we will refer to adjusted EBITDA, a non-GAAP financial measure that we believe provides useful information for our investors. you will find a historical reconciliation of adjusted EBITDA to the corresponding gap measure in the earnings press release and other filings with the SEC. And now, I'd like to turn the call over to Stan.

Good morning, everyone, and thank you for joining us today. It was both a record-setting milestone year and a comeback year for Vivid Seeds with the rapid return of live events that began during the second quarter. Our performance continues to build on our positive momentum and reflects the clear desire of fans to return to their favorite events. Early in 2022, we reached our 100 millionth ticket milestone. It is an accomplishment that reflects our profitable growth at scale and is another example of the incredible momentum we are seeing as a brand and as a business. We believe our marketplace delivers a seamless and trusted experience for fans to safely buy tickets so they can attend more of their favorite events. I'm proud that we have played a part in creating over 100 million customer memories. Larry will take you through the fourth quarter results and 2021 full year numbers in more detail. But first, I want to comment on some highlights. For full year 2021, despite limited volume in the first quarter, we delivered our highest annual Marketplace GOV ever of $2.4 billion, exceeding 2019's Marketplace GOV of $2.3 billion. We delivered $443 million of revenues and $110 million of adjusted EBITDA. Following record-setting third quarter performance, we are pleased to have delivered another record-setting quarter for Marketplace GOV and revenue in the fourth quarter, despite the impact of Omicron. Throughout 2021, we not only rebuilt the business to its prior scale, but also pursued and executed on a number of strategic objectives that will enhance our long-term opportunities. First, with the return of live events happening more quickly than originally anticipated, we pulled forward our brand launch into the fourth quarter of 2021. Since the launch of our rebrand, we have seen a meaningful increase in awareness in the geographies we targeted with our brand efforts. We view brand awareness as an important pillar with meaningful long-term benefits, and our guidance reflects incremental brand investments for 2022. In parallel with these brand investments, we will continue to be aggressive with additional performance marketing spend that will grow in line with Marketplace GOV. As we see competitive marketing and pricing pressures continue to build, we remain armed with a strong balance sheet that we are poised to utilize aggressively to compete. We believe Vivid Seats comes from a place of strength, given that we are already scaled and highly profitable, even on the first transaction. We also saw strong adoption on the seller side with over 100 new sellers added to Skybox since mid-2021. Skybox, our proprietary ERP that we offer to sellers free of charge, was already one of the most widely adopted in the industry, and we continually upgrade this platform to support evolving seller needs. Next, in December, we completed the acquisition of Betcha Sports, a real money daily fantasy sports app with social and gamification features that allow fans to utilize their skills and engage with their favorite live sports. The acquisition of Betcha will allow Vivid Seats to extend our marketplace technology into the online gaming sector, accelerating our journey into naturally adjacent areas. Betcha has an intuitive and simple-to-use interface that allows both casual and superfans multiple ways to play and win together. We believe this acquisition can significantly increase our TAM and, more importantly, create a monetizable engagement platform that allows a unique ability to bidirectionally drive efficient customer acquisition. User engagement within our product ecosystem remains central to our long-term strategy, and Betcha users are highly engaged, placing on average more than 10 entries per month. While Betcha is still a small business, we are excited to continue building and integrating our products and brand to leverage engagement across all our categories. We've been incredibly impressed with Betcha's team and look forward to leveraging our collective expertise and passion for live events. Additionally, we continue to forge partnerships that will help us deliver exceptional experiences to our customers. We renewed our multi-year deal with ESPN as their official ticketing partner And as part of this partnership, deployed an extensive media campaign across ESPN platforms to introduce our new brand and drive awareness to the more than 150 million fans ESPN reaches each month. Expanding partnerships with category leaders like ESPN bolsters our efforts to solidify Vivid Seats as the marketplace of choice. Finally, we have continued to invest in our customer service. In the fourth quarter, we officially opened a new customer experience facility in Coppell, Texas. Vivid Seats has a track record of providing excellent customer service and for the last three years has been recognized by Newsweek as one of America's best companies for customer service. We remain committed to continually raising the bar and increasing customer satisfaction. Our success this year is a testament to the strength and dedication of our team. In January, we were proud to once again be recognized by Built In as one of the best places to work in Chicago. I am also proud that we have continued to support and raise awareness of important causes. To celebrate our 100 millionth ticket milestone, we donated $100,000 to Music Cares, the leading music charity in the United States, to help strengthen Music Cares relief efforts, supporting those in the music community and their families. Additionally, in light of the current humanitarian crisis, we are joining all those calling for peace in the Ukraine and lending our support during this horrific time. Through our charitable organization, Vivid Cheers, we will be donating $100,000 to help those most in need. With that, I will turn it over to Larry.

Thank you, Stan. I am pleased that our second earnings call once again aligns with record results, despite the ongoing impact of COVID-19 and most recently the Omicron variant. As Stan mentioned, we sent company records for Marketplace GOV and revenues in the fourth quarter. In addition, we exceeded the high end of full-year guidance across each of Marketplace GOV, revenues, and adjusted EBITDA. Our record Q4 Marketplace GOV of $876 million was fueled by the continued return of live events and represents a 23% sequential increase from Q3's record-setting marketplace GOV. Our Q4 GOV benefited from a meaningful increase in average order size from roughly $300 in Q3 to nearly $400 in Q4. The increase in average order size is partially attributable to typical seasonal mix, but also reflected in improving demand environment throughout most of the quarter. That said, it is worth noting that the latter part of the quarter was negatively impacted by Omicron. The impact was most pronounced in theater, with numerous Broadway productions canceling, along with noticeable impacts across the NBA, NHL, and college football. Our record-setting quarterly revenues of $164 million were primarily driven by our strong marketplace GOV performance. Our take rate, which we calculate by dividing our marketplace revenues by our marketplace GOV, decreased 60 basis points to 16.3% from 16.9% in Q3. This is consistent with typical seasonality due to event mix in Q4. Our underlying take rates remain largely consistent with historical levels. In the fourth quarter, we generated $28 million of adjusted EBITDA, which represents an approximate 17% adjusted EBITDA margin. Adjusted EBITDA and adjusted EBITDA margin declined sequentially as we invested significant amounts in our new brand. These investments drove meaningful improvements in brand awareness and target markets, which we believe will generate meaningful long-term benefits. Turning to our 2022 financial guidance, we anticipate 2022 marketplace GOV to be in the range of $2.7 to $3.0 billion, with revenues in the range $510 to $550 million. At the midpoint of guidance, we are forecasting nearly 20% year-over-year growth for both Marketplace GOV and revenues. Moreover, our 2022 Marketplace GOV guidance is 21% higher than our analyst day projections, with our 2022 revenue guidance also 15% above previously projected levels. Please note our guidance assumes that roughly one quarter of the MLB season does not occur due to the ongoing lockout. Our guidance also assumes that our gross take rates remain in line with historical levels, while cancellation rates normalize over the course of the year. We launched our loyalty program in late 2019, and as a reminder, the cost of that program is recorded as a contra revenue, thereby causing some take rate compression when comparing to full year 2019. We anticipate generating $110 to $115 million of adjusted EBITDA. This guidance reflects continued investment in our brand, investments to scale our new daily fantasy sports offering, and the build-out of our public company infrastructure. Relative to 2019, the aggregate spend in these categories collectively represents $33 million of incremental expense. We are pleased that the growth of our business is enabling exciting long-term investments that position us well to continue delivering robust growth. Our marketing budget contemplates continued investment in building our brand while maintaining our historical strength in performance marketing channels. If we see additional or perhaps even irrational spend from competitors, we will defend our share as necessary and leverage our differentiated scale and cost structure to win over the long term. On the gaming front, Betcha revenues and expenses will be captured in our marketplace segment. Betcha is currently in a hyper growth phase but off of a small base. As such, Betcha's current contribution is not material to our financials. That said, we do anticipate several million dollars of net investment between marketing and GNA in 2022 to properly scale this offering. We are excited about the significant enhancement to our TAM that Betcha brings through a category with high relevance to our customers. We continue to believe our adjusted EBITDA margins will be north of 30% in the long term as we reap the benefits of these near-term investments. With that, I will hand it back to Stan for closing remarks.

Thanks, Larry. To conclude, we close out our first fiscal year as a public company with another record-setting quarter. Our strong financial results and robust balance sheet, combined with our strategic investments, position us well for 2022 and beyond. We believe nothing beats the thrill of life, and it's clear that there is a strong and growing consumer demand for experiences. Indeed, already in 2022, Vivid Seeds had a record-breaking Super Bowl, with both Marketplace GOV and Marketplace orders more than double our previous record for the big game. We remain focused on creating exceptional experiences for our customers and identifying opportunities to drive sustained growth and shareholder value. And with that, Operator, I will open it up for questions.

Ladies and gentlemen, if you have a question or a comment at this time, please press the star, then the one key on your touchdown telephone. If your question has been answered or you wish to move yourself from the queue, please press the pound key. And we also ask that you limit yourself to two questions and feel free to get back in the queue for any follow-ups. Our first question comes from Steven Jew with Credit Suisse.

Okay. Thank you. So, Stan, I wanted to dig in a little bit on your commentary regarding Betcha. So do you think the top of the funnel for Betcha to be, you know, longer term of similar size or larger than Vivid Seeds, and just trying to figure out, like, which property will serve as a source of leads. For the other, was the aim here to just layer in a service that may perhaps be a little bit more rapid fire in terms of consumer visits. And also, Larry, in your prepared remarks, you talked about the potential for irrational marketing spend from competitors. Can you talk about how often that has happened and you know, vivid seats, I guess, pre-pandemic operating history. I mean, it might be irrational to you, but it might be rational to them. So just kind of talk about what might have happened before and how you operated through such a challenge. Thanks.

Hey, Stephen. Good morning to hear from you. You know, on the Betcha front, like I think Betcha is still for us small, hyper growth, but we're really excited about the signs that we've seen there. You know, as we talked about both in the prepared remarks and prior, As we think about building out an ecosystem of products that really allow consumers to experience the thrill of live in multiple ways, the engagement components of Betcha have been really promising so far. As we take what's historically been a lower order frequency category in live events and combine that now with an asset that is showing us 10 plus entries per month, I think we remain really excited about that as a channel to drive enhanced engagement from consumers. And then forthcoming from that, I think our ability to then use the two categories and monetize both of the channels, whether it's the live event ticketing space or in engagement through daily fantasy, remain really exciting. So as we look at customer acquisition in the future, I think we're excited to have this as a weapon in our arsenal, that we can continue to really drive efficient customer acquisition where the consumer also has a fantastic experience while doing it.

Yeah, and on the competitor question, I'd say as a general rule, it's been a pretty consistent competitive landscape. There have been moments in time that are exceptions. I'd probably point to when StubHub was for sale and they were eager to show that the business was growing, they may have been more aggressive than the spreadsheet would otherwise tell you for that type of intangible reason. But for the most part, other than brief windows of time. It's been a well-ordering, a well-functioning landscape. As you think about the comments that we made, you know, when we talk about irrational, we hear you, right? Different people, different objectives, different paradigms. When we say that, you know, we have a pretty good ability to infer what the lifetime value of customers is based on what we know about repeat rates across the industry. what we see with repeat rates. And so when you triangulate around what people are charging, which we have very good visibility into what that turns into in terms of their take rate and map that against what we're seeing them spend, if you come to a view that there are negative lifetime value decisions being made, that's where we say it's irrational, not necessarily just losing money in the current period to set up future success.

Thank you. Our next question comes from Ralph Sheckhardt with William Blair.

Good morning. Thanks for taking the question. First question, I guess, would be for Larry. Talked about sort of the impact in Q4 for the Omicron variant and guessing that's built obviously in the Q1 as well. But maybe if you could sort of help us think about and quantify the impact as it relates more specifically to 2022. And then maybe if you could sort of lump in there with the MLB season and the other headwinds that you might be seeing in 2022 guide as it relates to either end market or the variant. Be helpful. Thanks.

Yeah, so it was interesting. I think in a lot of ways with hindsight, Omicron was a less potent variant than certainly Delta was. but probably had a more meaningful impact to our business than Delta did, just given the sheer number of people that came down with Omicron. And the form that it really took was less about canceling events because of health concerns or regulator concerns and more about the performers, right, whether it was players in college football, NBA players, theater performers, them getting canceled. COVID via Omicron and needing to postpone or cancel the production because they themselves had it. Saw a very meaningful ramp or better defined as a spike starting in mid-December. And that continued almost to the day for like a month to mid-January and was pretty meaningful impact throughout. Now, it happens to be the case that Christmas to New Year's window is a pretty slow period for our business in a normal year. So probably less damage on an absolute basis in December than you see in January when things start to resume. I will say it has recovered, so that's now in the past, but it will be an impact that sticks with us for the balance of the year given it did seep into January. And then to the question on baseball, we all wish we had a crystal ball in We were really hoping to get a positive surprise last night, but that didn't happen. So we've built our guidance assuming that a quarter of the season doesn't occur. As you can imagine, we are generally back half-weighted, right? As the games start to matter more, as you get into the playoffs, it's more impactful to us on both the GLD and margin front. That said, it's still painful. And so hopefully our quarter of the season estimate proves conservative and But with where things currently stand, it's an unknown.

Great. One more. Larry, while I have you, can you just remind me of the seasonality that you would typically see, I'm guessing, 2022 as sort of a normalized environment, but sort of walk through the puts and takes of what you would normally see in terms of seasonality in 2022? On one side, you've got the consumer, people really want to get out to events, but there might be some capacity constraints. So help us think through that for the year. Thank you.

Yeah, so in a normal year, we generally see about 30% of our GOV happen in Q4, which is a result of all the sports being in season, holiday shows like the Nutcracker, and then a lot of concert on sales for the following summer. The remaining 70% roughly splits evenly across quarters. One year, Q1 might be higher than Q2. The next, it'll invert. And that will often be determined by was it a good Super Bowl matchup, was it a good NBA playoff matchup, were there game sevens in the NBA and NHL playoffs. So hard to predict with precision beyond Q1 through Q3 are generally similar to one another. I think given what we saw in Q1 coming out of the gate, all else equal, you'd assume that to be a little bit less than normal. But for... We now have a reason for Q2 to be a little bit less than normal with the slow MLB start.

Okay, that's helpful. Thanks, Larry. Our next question comes from Jason Besnett with Citi.

Thanks. I appreciate the guidance and the MLB commentary. I just had a question about how you thought about higher energy prices as it relates to demand for secondary tickets, just because I think it's been 15 years since we've seen energy prices this high, so we probably don't have a lot of analog. So just curious, like, how, if at all, you incorporated that into your outlook and what impact you think it might have.

Yeah, hey, Jason, it's Stan. You know, I think it's a really interesting question, right, and I – I tell you, you know, I think what we've continued to see in this world is that live events continues to elicit a lot of excitement from fans, and fans, you know, tend to travel to their events, right? I think what we've seen is, you know, on average fans, you know, this year as we project out are probably traveling about 15% to 20% more than they ever have in the past. So as you think about perhaps the impact of this, again, I would think about it as, where we see average order size landing being that we serve as almost that perfect barometer for the intersection of demand and supply. I think as you think about where we've modeled guidance, and I think Larry talked about that here, I think you can imply certainly where we've been fairly conservative in terms of where the average order size is. So in terms of where we see the business, I think we are continuing to be excited about the prospect of live events for fans and I don't think we've modeled too much impact from, I'd say, energy prices and the impacts on us.

Okay. Thank you.

Our next question comes from Shruta Kajwari with Evercore ISI.

Okay. Thank you. Could you please provide – just some context on the average order size and marketplace orders. Understood your commentary on inflationary pressure, but you do face some tough costs when you think about average order size. So how should we think about it for 2022, even for the full year? That context would be helpful. Thank you.

Yeah, so we're assuming some regression to the means after what was, as you pointed out, a pretty strong 2021, especially in Q2 relative to historical levels. I think there's a lot of comments out there, whether it's live nation foolishness or just general inflationary commentary that could make you think that there's reason for 2021 to occur or even more than that. When you start stacking up broader inflation, live nation bullishness, pent-up demand hypotheses, there's good reason for that. We did not take that approach. So if it should play out in that way, we'll have some nice cushion built in. I think we tried to stick to our netting a bit more, so closer to what we had put forward in our analyst day projections around start from historical levels and assume growth. consistent moderate growth from there to establish the baseline. And if we get a pleasant, positive surprise, that will be good news.

Okay. Thanks, Larry.

Our next question comes from Dan Kernels with Benchmark.

Great. Thanks. A couple for me. First, obviously, you know, Pulling forward the Brent spend, you guys clearly are striking while the iron is hot. It sounds like your competitors are having some difficulties on their process to market. How do you think about the spend this year given some of the headwinds that were mentioned? And, frankly, I mean, look, your guidance actually implies share gains because you gave a guide that was probably in line with what most of us were thinking despite all of these headwinds. and your AOS kind of in line with our thoughts. So, you know, just how do you think about balancing that, knowing that LTV calc and then your incremental commentary, obviously, that it might be LTV negative for them, but that doesn't necessarily mean that it's LTV negative for you. Maybe start there.

Yeah. Hey, Dan. Yeah, sure. Yeah, I think, you know, we've been really excited and continue to be about, you know, brand efforts being a really strategic and long-term pillar for us. You know, and we saw – positive indicators, you know, in our pull forward in the fourth quarter where, you know, if you think about brand again, primary objective being driving awareness up such that long-term value from consumers holds. We certainly saw on average double-digit awareness increases in the markets where we tested multiple channels. So I think bullish on that. As we then think through, I mean, weaving the story all together, the opportunity to drive a brand message that's actually distinguished because the proposition of Betcha allows some immediacy in engaging with us. And then from that immediate engagement, a higher frequency channel that we can then cross-sell into ticketing. I think you'll see what we do this year reflect a lot of that strategy. Then when we look across the competitive landscape, you know, I think the way I think about... the landscape and some of the comments around irrationality. I mean, two things, one specific to our industry. As you mentioned, perhaps last year, I think, thanks to our nimbleness, our scale, and some of our technology prowess, we were certainly able to go to market very quickly as events came back, and that's a real testament to the team and the technology that we have. As we look at this year, I think we make no assumptions that our competitors are not ready. And I think we are ready to go compete with all of them. I think for consumers, confident that we have a great product that's differentiated with economic value as well as experiential value. And then I think even tying it back to the other comment on irrationality in the industry, I think the goal for us has always been, look, every industry faces a new entrance who are going to try to establish scale. And for us, as we look at that landscape here, there are certainly those players that exist. Subscale, need to prove themselves, need to come out. You know, we're here with a great product. We're here with a great balance sheet. And so should we see people try to establish themselves? I think our point here is, look, we're going to fight that fight and we're stronger than And we're doing this to win. So I think that's how I'd certainly look at the competitive landscape and how we're assessing that in line with how we're looking at deployed dollars this year.

Got it. That's helpful. And then just I do want to touch on the experiential part. Obviously, Stan, that's been a huge component to the differentiation strategy. I know you talked about, I think Larry gave the number several, $7 million in investment investment. to scale the Betcha offering. Can you just give us some more granularity on some of the things you might be rolling out? Obviously, you know, maybe for competitive reasons, not all of them, but just how you think about continuing to build out either, whether it's social engagement as a chat functionality between people at games, you know, some of the other things that you're going to work on on the platform that will, you know, again, highlight that user engagement differentiation that you've been building out relative to the peer sets.

Yeah, sure, Dan. Yeah, I think, you know, there's maybe two buckets I think about this, right? I think we've talked about the first one. I think the brand integration, maybe that is thematically how I would think about, you know, what we're doing there. You know, I think the proposition for us becomes different, right? As we think about two categories that I think have appealed to consumers, but certainly with a lot of affinity and synergy. So we're certainly going to be working hard to make sure that how we drive our brand elements is integrated across those categories. Similarly, our product teams are really hard at work to think, you know, what is the right way to present the opportunity to engage with us in Ibecha while also presenting the opportunity to go to a live event, you know, provide where the offerings and kind of that cross-sell comes from. our marketplace, right? So I think I would frame it those two ways. As we continue to work hard on the integration and the product strategy, I think that's where you're going to see us make investments to ensure the experience is right and that the channels we use to acquire customers continues to be one that is long-term LTV positive for us.

Got it. Super helpful. Thanks, guys. Our next question comes from Stephan Pazin with DA Davidson.

Good morning. Thank you for taking my question. I just have one for you today. To date, how is your rewards effort contributing to your sales compared to your expectations?

Yeah, so I'd say a few things. One, we rolled out the revamped loyalty program in the summer, so we're still pretty early days in evaluating the program. In particular, in our industry, we've touched on this before, but it's a low-frequency industry. You'll often see folks that place one, two, maybe three orders per year. It's a fairly standard distribution. So to get through that repeat cycle takes some time. We're still fairly early in that process. That said, I'd say we are seeing some pretty encouraging signs in our repeat rate data. with a caveat and an important one that all of our time that we are looking at to test this was COVID impacted. So you had the pent-up demand playing out in the summer. You had events getting postponed and canceled. You had a lot of moving pieces that we don't normally see. That gives us some hesitation to declare victory too early, but the indicators are encouraging.

Yeah, the other thing I'd add to that, I mean, certainly we've seen early signs on repeat rates, which is really encouraging to us. I mean, other pieces, we talk about brand and building that message. I think a key part of our brand proposition is the fact that we are the only one out there with a rewards program. And I think as we've tested the brand channels, I think we've seen some fairly resounding kind of success in terms of awareness going up. And as you go lower into the funnel from awareness to intensive value, I think that rewards message has continued to move downstream in that path. So I think, you know, excited about the prospects on how it allows us to acquire consumers as well as ultimately drive the repeat behavior that we're looking to drive out of them.

Excellent. Thank you for taking my question.

Our next question comes from Maria Rips with Canaccord.

Great. Thanks for taking my question. I appreciate all the color around your forward outlook, but just wanted to follow up on that. With incremental marketing and other investments this year, to what extent some of the benefits of those are embedded in your outlook in the latter part of the year? Or could that be sort of incremental to what you're currently expecting?

Yeah, I'd say for the most part, we continue to take a fairly cautious posture around putting hard numbers first. alongside the brand investment and continue to take the view that this is a long game. And so I think similar to the answer on loyalty, you're seeing a lot of the indicators you would hope to see as you build awareness and move folks through a funnel. So we're encouraged, but I have refrained from putting stakes in the ground and putting that into projections in a meaningful way at this point.

That's helpful. And then just following up on Betcha, sort of what are some of the key milestones for integrating that into your sort of Vivid platform? I know you mentioned sort of brand integration. Is there anything else to highlight there? And then more broadly, how are you thinking about the opportunity in the gaming sort of between fantasy, daily fantasy, and online sports betting?

Hey, Maria. You know, I think the first thing is on the – milestones, you know, I think certainly we are aspiring to drive, you know, a holistic consumer experience there. And we're testing all sorts of ways to understand where the consumer appreciates the ability to engage in both and where, you know, again, we can truly enhance the frequency and engagement there. I think the milestone you'll look for is when you see certainly some of the integrated components show up in you know, the products that we have, I'd say that would be a significant milestone, although already we are testing multiple channels through our CRM capabilities to drive some of that integration and learn from what we got there. On the other question on landscape, look, you know, I think, you know, we know who we are first and foremost, right? And I think we are ultimately, you know, a marketplace that is looking to drive engagement into our consumers. And therefore, I think with Betcha, the play was certainly significant you know, an option on TAM expansion and something that we're really excited about. But that sliver in terms of daily fantasy serves as a monetizable channel for us to drive acquisition into our core ticketed marketplace. And that remains kind of our view on that. But we're certainly going to be opportunistic as we look at other things and how we define adjacencies as kind of our maturity in the sector evolves.

Got it. That's very helpful. Thank you, Stan. Thank you, Larry.

Our next question comes from Andrew Morrock with Ribbon James.

Thanks for taking my question. I wanted to dig in on one of the stats that you gave in your prepared remarks on Skybox with the addition of the new sellers. Is that from incremental capabilities or functionality added, or is that just increasing network effects? What feedback are you receiving from sellers that's getting them into Skybox? Thank you. Yeah.

Hey, Andrew. Yeah, I think Skybox continues to be, I think, the leading ERP in the platform. We've got wonderful in the space. We've got fantastic technology, I think, that sellers appreciate. And we continue to enhance the offerings there, whether it's our data capabilities that allow sellers to grow their business better, our fulfillment offerings that we've talked to folks around. I think if folks look at the combination of the technology ability, the data that allows them to grow their business, our performance, call it offerings like fulfillment that allow them to run their business at a better cost structure than they would be without, and then combined again with the fact that it's economically free to them, I think that value proposition, you know, in all those three dimensions has truly helped differentiate us, and therefore we continue to see lots of interest and continuing adoption of the platform.

Great. Thank you.

And I'm not showing any further questions at this time, so this also does conclude the conference for today. We thank you for your participation. You may all disconnect and have a wonderful day.