SmartRent, Inc.

Good evening and welcome to the Smart Rent, Inc. Third Quarter 2021 Earnings Call. At this time, all participants are in listen-only mode. A question and answer session will follow management's presentation. As a reminder, this conference call is being recorded. I would now like to turn the call over to your host, Evelyn Inferna, Senior Vice President of Investor Relations. Thank you, Evelyn. You may begin.

Thank you, Operator. Good evening, everyone, and welcome to Smart Rent's third quarter conference call. Joining me today are Lucas Haldeman, Chairman and CEO, and John Walter, Chief Financial Officer. After the close, we issued an earnings release and a 10-Q, which are available on our investor relations section of our website. Before I turn the call over to Lucas, I'd like to remind everyone that the discussion today may contain statements related to our business that may be considered forward-looking. including statements concerning our plans to execute on our growth strategy, our ability to maintain existing and acquire new customers, and other statements regarding our plans and prospects. Forward-looking statements are often identified with words such as we expect, we anticipate, we believe, or similar expressions. These statements reflect our view only as of today, November 10th, 2021, and should not be considered our views as of any subsequent date. We do not undertake obligation to update or revise any forward-looking statements. Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties that could cause the actual results to differ materially from our expectations. For discussion of material risks and other important factors that could affect our actual results, please refer to those contained in our registration statement on form S-1, filed with the SEC on September 23rd, 2021, and our quarterly report on Form 10-Q, which are available on the investor relations section of our website and on the SEC's website at sec.gov. Finally, during today's call, we will refer to certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in our press release issued after the close today. And with that, let me turn the call over to Lucas to review our results. Lucas?

Thank you, Evelyn. Welcome, everyone, and thank you for joining us as we review our third quarter results. SmartRent had a truly outstanding quarter. We delivered an all-time record revenue of $35.1 million, representing a 112% increase over last year. After deploying 56,000 units in the first half of 2021, we deployed a record 59,000 units in the third quarter alone, 111% more than in the same period last year. Our total aggregate units deployed and committed were just under 1 million as of the end of the third quarter. These achievements are indicative of the passion and commitment of our team, the growing demand for our enterprise IoT smart home solutions, and the benefit of having approximately $445 million of capital to deploy to support our growth as a result of our successful public debut completed in late August. Since our debut, we've used a portion of this capital to invest in the expansion of our sales force, our field installation services team, and our research and development teams. We continue to attract seasoned, high-quality talent from leading technology and real estate service companies in keeping with our founding DNA of real estate technology. The increase in the number of employees, which is currently pressuring our margins, is necessary so that we can deliver on our booked and committed unit pipeline and pursue additions to our product roadmap, especially as we look to capitalize on our first mover advantage in the smart building industry. We anticipate that the expansion of our workforce, especially in our professional services revenue stream, will continue to help us effectively convert our committed unit backlog to deployed units. We believe our consultative sales process, onsite installation oversight by our field team, and our customer training and support are all key factors contributing to our success. Our extensive flexibility in integrating with a myriad of hardware devices, eight property management platforms, numerous CRMs, and maintenance software systems unlocks enormous value for real estate operators and owners. Our open architecture philosophy allows us to provide individualized solutions for property owners and managers who embrace the opportunity to enhance revenue, reduce expenses, mitigate risk, and reduce energy consumption. Our approach to the smart home or connected community business is clearly resonating with the market as evidenced by our growth in committed units and new customers. The financial benefit and improved efficiencies from utilizing our predictive maintenance tools, auto-generated work orders, self-guided tours, and overall reduction in workflow friction are compelling. A number of our customers have stated that they are experiencing ROIs in excess of 50%. In the third quarter, we added 17 new customers, growing our base to 199 loan portfolios with both existing and new construction in the multifamily, single-family rentals, homebuilders, and iBuyer markets. Collectively, our customers control approximately 4.1 million units, the vast majority being existing units that our teams will retrofit, one of our key differentiators. These units represent a significant annual recurring revenue opportunity for SmartRent. A majority of the units in our pipeline are owned by the largest institutional multi- and single-family rental landlords. We are also making excellent inroads into what we call the long tail, the thousands of property owners and managers of smaller institutional portfolios. On the product innovation front, we introduced several platform enhancements this year, including Alloy Parking, Video Intercom, and Alloy Access, our community access product. We are experiencing more and more of our bookings include one or more of these new products, along with self-guided tours and our original smart home offering. During the quarter, we launched a white label resident app that owners can brand for a specific property or company, which personalizes the resident experience while consolidating the control and functionality of all of the smart devices being utilized in the community. It also allows for other online services or marketplace offerings affiliated with that community. This app is an additional offering to our legacy resident app that engages approximately 570,000 resident users and our property staff app where we have approximately 17,000 users. We remain focused on advancing additional product enhancements related to the energy management and efficiency, given the growing importance of reducing energy consumption for our customers, their residents and the global community. Our go-to-market smart home offering that includes a smart thermostat and leak detector, along with our data collection and reporting capabilities from these devices, was SmartRent's initial step to help owners better understand and manage water and energy consumption. Over the last several months, we've evolved our energy management offering by integrating with an energy management software platform that collects and manages data from over 300 utility companies to facilitate ESG reporting and demand response rebates. The platform also provides rebates on smart thermostats and revenue sharing related to demand response program participation. Residents also benefit from our energy management products by reducing their utility bills and other financial incentives. Another important initiative is making managed Wi-Fi deployment a priority. We believe there's a compelling need for a robust Wi-Fi offering, which is largely absent or of inferior quality in most rental communities today. With the continued importance of workplace flexibility and the growing demand for streaming services, property managers can no longer ignore strong, reliable Wi-Fi as a curated amenity. We believe that property owners and managers will welcome an upgraded Wi-Fi solution where they can participate in a thoughtful revenue-sharing program while enhancing their residents' experience. This offering is particularly timely as long-term legacy telco and cable contracts are entering an expiration cycle. Residents should also benefit, as we believe that our managed Wi-Fi product will provide superior service to in-place or legacy solutions at a lower cost and with less friction. There's no cable company to wait for, and the service can be turned on with just a tap in our resident app. Managed Wi-Fi should have a dual benefit for SmartRent, both as a contributor to our revenue stream and as an opportunity to reduce expenses, eliminating the need for our hubs to be connected to a cellular network. The opportunity to convert these hubs to Wi-Fi represents the potential for significant savings to the company. In recent calls with the analyst and investor community, we've been asked several questions about churn, including potential churn on our customers' property sales. In our experience, SmartRent communities sold by our customers have become stealth SmartRent product pilots in the buyer's portfolio, allowing the buyer of the community the opportunity to learn about SmartRent's value-enhancing platform firsthand. Instead of the loss of a community on our platform, we are gaining a new customer who in turn has multiple properties or a portfolio that we can now sell into with a relatively low CAC, a higher ARPU, and a newly cast five to seven year hosted services contract. Interestingly, some of our product offerings, such as Alley Parking, have become opportunities for us to penetrate non-residential real estate verticals. A number of our current customers who own multiple real estate property types are using allied parking not only in their multifamily communities, but also their office properties. Our recent expansion into student housing, while still in early days, is progressing well, with several student housing customers participating in pilots. We continue to recruit student housing industry experts as we build our team to further penetrate this promising real estate vertical. While our organic growth opportunity is large, are excited by the flexibility of our platform to expand into other verticals or acquire complementary software platforms our business development team has been working diligently to identify and vet opportunities that will strengthen our market leading position as part of our long-term strategy a successful acquisition for smart rent must include at least one of the following criteria advancement of our product roadmap or diversification of our product offerings entry into another real estate vertical Diversification of customer base or the expansion of our presence in geographic markets or market segments where we're underrepresented, such as the long tail that we addressed earlier. And lastly, given our size, any acquisition or partnership that we pursue needs to be a solid cultural fit. Our current focus is on domestic opportunities, but we are also evaluating international expansion where we believe we can ramp following our proven land and expand model. With that said, we have made inroads into Canada and the UK. During the quarter, we welcomed a Canadian customer that has recently converted from pilot to portfolio rollout, an achievement we are extremely proud of. We would also like to acknowledge the hard work of our UK team. They are setting the groundwork for smart rent expansion in that market. Overall, we believe that we are well positioned to execute our growth plan, and we have the financial and human capital necessary to continue on our trajectory. We are encouraged by our accomplishments in the third quarter, and believe that our achievements are just a preview of what SmartRent is capable of. Near-term headwinds related to the global supply chain notwithstanding, we are confident that SmartRent will continue to grow its customer base and revenue stream at a brisk pace. Our team is singularly focused on delivering value to our customers, growing our market share, and generating long-term shareholder value. Now I'll turn the discussion over to John to review the financial results. John?