Eventbrite, Inc. Q4 FY2023 earnings call

• Accelerated the two-sided marketplace model, with gross ticket sales at $3.6 billion in 2023. Community grew to over 91 million people and nearly 1 million event creators. - Introduced product investments like AI-powered event and marketing flows to speed up event listing and campaign creation. - Restructured teams, outsourcing customer support to Philippines and scaling dev in Spain/India to reduce overhead and improve efficiency. - Focus on demand generation, with over 75% of surveyed creators seeing Eventbrite as a demand generation partner. - Eventbrite Ads revenue growing, and new ways to tailor event listings based on creator feedback.

Non-ticketing revenue grew from 2% to over 10% of total revenue by Q4 2023. Subscription and per event organizer fees totaled $6.6 million in Q4 2023. Eventbrite Ads revenue was $2.3 million in Q4 2023, up 28% quarter-over-quarter. Gross margin exceeded 70% for the first time in Q4 2023 compared to 66% a year ago. Adjusted EBITDA margin was 12% for full year 2023, with 40% of year-to-year revenue growth flowing to adjusted EBITDA.

• Full year 2024 revenue expected to be $359 million to $372 million, midpoint representing 12% growth from 2023. - Q1 2024 revenue outlook $84 million to $87 million, 10% year-to-year growth at midpoint. - Paid ticket volume expected lower in H1 2024 but improve later; average ticket prices to increase low single digits. - Organizer fees to contribute to revenue growth in 2024. - Adjusted EBITDA margins expected in the low to mid-teens. - Product development expenses to grow faster than revenue, sales/marketing expenses to grow modestly, general and administrative expenses managed tightly, stock-based compensation to decline further.

• Near-term impact of organizer fees on paid ticket volume. - Potential churn of creators due to the introduction of organizer fees. - Need to effectively manage the transition to the new marketplace model and ensure continued growth. - Competitive landscape could impact ticket volume trends.

Q: Couple of questions on creator retention and how long efforts to get paid creators with in-demand events to show in numbers.

A: When organizer fees were introduced, there was near-term impact on ticket volume and creator growth. Sales team closed 24% more new accounts in H2 2023, and momentum continues. Deals are focused on metros, and there's a 45-day latency between event sale and occurrence, allowing data-driven reorientation.

Q: Reconcile growth in paid events, paid creators vs paid tickets down 4%.

A: When organizer fees were rolled out, there was shift in event size. Creators using marketing tools outperform, 75% of surveyed creators view Eventbrite as demand generation partner. Sales team expanded by 50% in H2 2023, closing 24% more customers, and deals are larger in target metros.

Q: Confidence in demand generation products and reaccelerating ticket growth.

A: Marketing tools and Eventbrite Ads already 10% of revenue mix. Mid-teens adoption of marketing tools with 5x-6x ROA. Targeting high-value creators with ticketing and advertising. Consumer traffic and relevance improvements will boost ad inventory and Eventbrite Ads adoption.

Q: Progress on organizer fee related problems and creator adoption of features.

A: Organizer fee introduction had natural market digestion. Most creators stayed, but there was impact on free ticket side. Adoption of marketing tools is a combo of strengthening demand gen messaging and offering free trials. No major competitive landscape changes, but mid-market sales-driven companies face challenges.