Okay, so we'll get started. I'm Dave Lee, J.P. Morgan's Internet Analyst, and we're pleased to have with us today Anand Gandhi, Eventbrite's CFO. Just as a background, Eventbrite is a leading Ticketing platform on its way to become a marketplace for things to do. Anand joined Eventbrite last November, and prior to that, he was the CFO at Viator and Skillshare, so he brings robust experience running marketplaces. So welcome, Anand. Thank you. Thanks, Dan. All right, to start off, let's talk about, like, why is Eventbrite trying to evolve into a marketplace? A great question, and the marketplace transformation is one of the reasons I was so excited to move over to Eventbrite. Beyond being a natural progression, for me, it's immediately clear, it's immediately clear that there's a real opportunity to become a much stronger two-sided marketplace. Similar dynamics to where I came from at Viator, with some advantages. You know, there's two decades of experience cultivating deep relationships on both sides of the marketplace, and that's lent itself to create a really strong brand, which means that here's a platform that has demand that's being generated, plus the long history of strong supply relationships, without a need to spend on performance marketing to generate, you know, traffic with tremendous, you know, 90 million uniques. For me, it feels like it's a natural progression with a lot of upside. As Eventbrite makes progress to that, like I think we're doing today, you know, some of the relaunch of the brand and the relaunch of the app and the stats we're seeing with increasing MAUs, as well as improved app usage, those are all things that are really going to drive the flywheel effect and have our creators really see the benefit of being part of a marketplace where they're getting demand generation. We can really provide the discovery, demand generation, that is really incremental beyond being a purely Ticketing platform. It fits really the strengths that Eventbrite already has, and it fits the needs of our creators who are so central to the mission of Eventbrite from day one, by really serving them better to generate demand. It leads to just a platform that just can grow faster as this flywheel really takes hold. Okay, so is it fair for me to think that Eventbrite's brand and the organic creator acquisition funnel is what differentiates Eventbrite from other marketplaces that you've been at? Yeah, absolutely. I think it is a significant differentiator. I think sometimes you could see a marketplace that is scaled very strongly, purely on supply, and the question is, can you make that—can you really convert to actually generate demand and be a destination? Would someone think of going to you first before going to Google to think of things to do, for example, right? The fact that there is this much traffic, this strong brand, means that we are seeing all of this interest coming directly, even before you start thinking about whether there's room to expand further with performance marketing, like a lot of marketplaces need to do. Okay. It is a big differentiator, I think. Since you mentioned that, is—I mean, do you see an opportunity to expand further, right, performance marketing? Eventbrite historically has not. Yeah, historically, you know, I came from a place spending hundreds of millions in performance marketing, which I actually oversaw, and we really do not spend much today. I think it is something that I would not—we are something we are digging into. I would say that this year, we are really focused on, you know, financial discipline, showing that we can keep OPEX down, returning to growth, without being reliant on expanding into more spending on performance. Long term, you know, considering all the data that Eventbrite has, I do think it is reasonable to think that there is a path to figure out how to actually leverage certain channels to add to growth. I think that is something that we are going to be cautious of right now, purely just because of this focus on financial performance, OPEX discipline. Long term, I do believe that the data we have and the history of the data, and how targeted it is, should lend itself for us to figure out how to leverage certain marketing channels to add to growth. Okay, let's go back to the marketplace transition real quick. You did mention you have a new app, relaunch of the brand. What's most exciting about it, and how does this effort help you or Eventbrite in the transformation to into a marketplace? I think the app and the rebrand that it was part of are really big steps. There's the transition to a marketplace and driving consumer demand is so important. Like, there's proving that you can actually be useful for discovery. You know, my experience is not an easy transition to make, and the app is a real key step there. I'm excited from the fact that it feels, both from my own personal experience and from the stats, that the changes made really reflect understanding the consumer quite well. They lead to more engagement, to content that lends itself to people wanting to spend more time on the platform, to actually being curious to see what else you can learn in a way that's additive to the way it was before. For me, I would say that from my experience, it can sometimes take a lot of different tries to figure out what sticks to drive increasing the demand side and that engagement. It feels like we're seeing good results already, and it feels like the way we are, the aspects of the product that are being focused on, really make sense and are really organic to what we're trying to provide. There's content, there's ways to help drive additional discovery that we think will align with interests of our consumers. There's also features that drive some community and being able to see sometimes what friends you know on the platform may be doing that could drive you to attend an event as well. Those types of features that really add to the flywheel and seeing success there, I think, is really exciting. Okay, so starting to build a pillar on the demand side. Yeah. All right, let's talk about the size of the opportunity next. In the presentation you published last week, you mentioned a $28 billion global mid-market events gross bookings, of which Eventbrite is making up roughly 14% of that. Before we go into the competitive dynamic, could you help us understand how fast the industry is growing and what the drivers are? Yeah, you know, I, so there's so many data sources out there, and I would say from a simple perspective, what Eventbrite is serving, live experiences, there is, we're seeing continued strong interest of experiences over things, needing to see, needing human connection, especially as people spend more time staring at their phones, needing to get outside. From a high-level logical perspective, we believe that the market is going to continue to grow for a long time. In terms of data, you can see different stats here and there, and I wouldn't say there's one kind of third-party data source I would stat for a specific, you know, I'd focus on for a specific stat. From what we're seeing, it does feel that the market, we are benefiting from tailwinds of a market that is still growing. Okay, yeah, my daughter blames me of looking at my phone too much as well. Speaking of the mid-market events, you make up the 14%. What, like, who makes up the rest of that market, and what is your moat versus those competitors? You know, I would say that the space we're in, we're really fortunate that there isn't a single competitor that stands out that we really focus on saying that we need to see what that competitor is doing, and addressing that is really going to accelerate growth. There are a host of more niche competitors out there that are smaller. For us, you know, rather than naming them all, I think what's the most important thing to think about is one proof point is that as we lost a lot of creators, you know, in 2024 with the marketplace fee choice, and they didn't really head to one single competitor. Our competitors are quite fragmented, and that's also where we saw we lost creators was quite broadly in a fragmented way without any single person emerging. I would say that, you know, we see ourselves as, you know, excluding kind of secondary ticket sellers, we are the second most trafficked site after Ticketmaster. From what we see, our traffic is more than all of the mid, all these smaller players combined. There isn't, so our growth, I don't think, is really dependent that much on specific competitors potentially stealing share. Okay, how about competition from outside of mid-market then? Because you do have Ticketmaster in the higher part of the event pyramid, and we did see Airbnb yesterday announce a new service, services and experiences. You know, their value proposition was to unlock human connection, which is what you guys are trying to do as well. Curious to hear your thoughts on how you think about this space evolving over time and how you think about Airbnb and other experiences platform becoming a potential competitor. Yeah, great question. You know, it was good to see Airbnb's announcement because, again, coming from my prior role at Viator, where there's a lot of worry of what are they going to do exactly, how are they going to attack travel experiences? Our view is, they have a very unique and organic and very logical view of experiences that are potentially more targeted with individuals, potentially more high-end, but less about traditional kind of marketplace dynamics in terms of partnering with large suppliers. These are really experiences where in their own mission of trying to create community, having people, individuals being a tour guide, individuals giving you an experience, which I think is a really interesting approach and fits their vision. Fortunately, at the same time, I think it doesn't have too much of an overlap of where we see ourselves going. I think there's, in our space and considering being around 20 years and all the things you touch, there's going to be some sort of overlap at the fringes with anything, right? Our growth isn't going to be driven necessarily by those same type of really bespoke, potentially very high-end Michelin star chef coming over type experiences, right? Overall, I'd say a positive for us is when you have someone like an Airbnb coming in and really reminding people of the value of this space and how much value potential upside there is just in human connection and live experiences. At times, you know, I've heard Brian Chesky say that he thinks that those types of experiences could be a bigger market than actually their primary market. That's, I think, really encouraging, and I think I'm optimistic it'll be helpful for the space and also for us to hopefully get some more attention, you know, in the investment community. Right, so that can help you or help drive awareness of things to do locally, which should benefit you guys as well. Yeah. Okay, all right, let's move on to the topic of the Organizer Fee. You talked about, mentioned it briefly. So you guys did roll it out in 2023, saw paid creators headwinds through most of 2024. Please tell us, like, what did you guys do against that headwind, and how are you guys progressing on clawing back some of the fee-related losses? Yeah, you know, I'd say those organizer listing fees, it was a great learning. And, and, so at a high level, you know, what we saw, as you know, as most of you probably know, is that the results of charging for an action that is actually something you want to encourage in the flywheel, you know, doesn't doesn't help the flywheel dynamics we're trying to make. I think that reversing the Organizer Fees, you know, late last year was absolutely the right move and caused a lot of near-term headwinds, you know, in terms of revenue and losing $20 million of, you know, revenue, essentially a period of doubt, right? but but fortunately, I do think that that's not something that has a permanent stain in people's memories that this company's been around for 20 years, right? For us, we focused on really a multi-prong approach here. You know, there's one hand is reaching out and trying to get back the creators you lost, right? There are different ways to do that. Initially, there could be some sort of incentives you want to do, but long run, I think, you know, our view is that it's really reminding them of the value we provide and the fact that a lot of them may have gone to a platform that serves them fine, but do they necessarily deliver the strength of the product that we do? Do they actually have the potential to drive demand? What we're seeing is that's probably a harder case to make for some of the places these folks have gone to. Another way to put it is, in general, reactivating creators is a key part of that all, right? Also, the efforts we're going to do for the product overall in terms of product enhancement and then all the efforts we make to acquire customers, those are all things that help as we try to bring them back. Okay, could you remind us, like, who are the type of creators who left the platform because of this? You still have a lot of creators who stayed on despite the changes. Curious to hear, like, what's different about those who stayed versus who left? How long does it take to get, like, reactivate those creators, right? You do have a sales team that go after different size creators, and then you also have the organic feed of creators. Can you kind of help us, like, walk us through, like, how things kind of trend throughout 2025 and going forward? When do you think you'll return to, like, positive paid creators growth? Yeah, I think it's a great question. So overall, you know, I'd say that there's, as you think about it, we do have these two. We'll start from the two kind of sales motions you talked about. One is the organic self-serve piece, and the other is the sales team. For the self-serve piece, that piece feels like it's going to steadily chug along in the right direction, and that generates 70% of the Ticketing revenue today and has historically been the core. That, I think, will continue to be true. The sales team motion, I think, in the near term will be a little more effective in terms of the timing of returning to paid ticket volume growth because of the fact that we can be more proactive there. We can do outreach to folks we've lost, do outreach to new folks, looking at certain markets. You know, we can look around and be like, "Why don't we want certain venues or certain creators on our platform rather than a smaller one?" We can target them aggressively. I would say the shape of the recovery, I think we'll see it on both sides. I think in the near term, we'll see a bit more growth, better momentum initially just on the sales side because of the fact that we control that. The other piece is we have a really strong sales team now, and I think it's taken some time to find the right leader who can really motivate a team, can hire the right people, can make sure that, you know, folks who are on a sales team aren't just, you know, fans of Eventbrite, but actually are true salespeople and who know how to attack different markets and know how to generate and win big business. That is what we're seeing is a much stronger sales team than we've had in the past with a lot of enthusiasm, a lot of positive energy. I think the combination of the two is going to be how we get there in the near term. I think the sales piece, while relatively smaller, is 30% overall, is going to be, I think, a big driver of the timing of the recovery. Okay, all right, so two paths forward. All right, and then moving to your revenue components, you have Ticketing being your core, and then you also have the marketplace revenue where Organizer Fee to sit. And today it makes up around eight percent of the total right now. Could you explain what else is in that marketplace revenue, and is it correct for us to think that marketplace revenue is going to be the biggest driver of your take rate increase? Yeah, good question. We, so that marketplace revenue line had historically been the Organizer Fees, some Premium Email Subscription services, some Premium Tools for Creators, as well as Advertising, right? Now with Organizer Fees discontinued, then it is those two components of the Pro Email Subscription, some of these Tools for Creators, and then ads. And ads is, you know, the largest piece, and over time will be the bulk of that marketplace line right now. In terms of take rate piece, yes, I would say the take rate piece, the marketplace revenue will increase effective take rate. As we have, what we're really serving is something that fits a flywheel of this product, of these creators who realize that they could spend 40% of their budget on marketing an event, they could probably get a really efficient purchase on our platform, and we're seeing good proof points. That will be a benefit to take rate. I think one thing I would say is that take rate, and obviously, you know, I like money from all sources, of course, but I think the question is also when is the right time to focus on which lever for growth? At this point, given our conviction on the size of the market, focusing on volume, I think in the near term is really important, right? Yes, we will benefit from take rate from Advertising, but I would say the way I think about it is the real value of Advertising is the fact that it's something that really supports a flywheel and can provide a lot of value and can become a big revenue stream in the future. That also happens to be able to calculate a larger revenue per user. I think of it as really actually scaling two revenue streams in kind of a more volume type mentality. Yes, that will result in an overall higher average revenue per ticket, but I think the right way for us to think about it is focusing on the growth more from a volume type mentality for both of the revenue streams. Okay, let's touch on the volume piece of the growth then. How do you think about that, the drivers of that going forward? I mean, is it mostly about getting more paid creators on the platform, or are there elements of helping them sell more tickets, thereby you guys generating more revenues on that as well? Yeah, I think it is both. It is the combination of, you know, as we're talking about getting creators back on the platform, acquiring more creators, and also doing an even better job of retaining the creators we have because, frankly, as you know, a lot of the marketplace models are really, really driven. A lot of the growth can actually be driven by retention, even though it doesn't sound like that would make sense. You know, improving retention rates are a real driver there. I would say that, sorry, I forgot the second part of your question. Apologies. like if there's two, like thinking about the two components, paid creators versus helping them sell more. Yes, sorry. Okay, the helping them sell more piece, I think, is really where we're seeing the logic is a big piece where we're seeing the logic of the marketplace, TZ marketplace, because as we drive more of that demand, we have people coming to the platform for discovery and to search for more things to do. We can generate more tickets for creators, and our internal metrics show that demand, what we believe is our own demand-generated activity and ticket sales, is improving. Yeah, I do think that is a big piece, I think, of how we will grow for a long time and I think reach the full potential of the business as a marketplace is as they see more proof points that we can deliver that, which I—so one thing, you know, to think about is the fact that we see the data showing, internally, and I know some of you who chat about in the past that of how we're driving demand for different tickets. A creator might not necessarily believe it or know it because, but from us, we have these internal things. I think we will need to keep on showing them and demonstrating the traction we're getting on the demand side for them to see that they have real upside from working with us. I'd also point out that that narrative, which is based on facts and data, is proving effective to win back creators as well and win new creators, even in the sales team effort, like as they're talking to win back or win a new larger venue, for instance, the data we have and just the facts of the traffic and the app really help make the case that Eventbrite can help drive more revenue and more ticket sales for a larger venue as well. That is really important. A lot of venues will think that they've been around forever. They just need the Ticketing, someone to facilitate ticket sales. When they see the traffic and how people are using it for discovery, it can be a compelling part of winning over a large creator. Okay, and you did say monetization is more of a longer-term opportunity, but Eventbrite's take rate today is sub-10%. And when we look across all of the marketplaces out there, it is on the lower end. Yep. We tend to think about, you know, high fragmentation equaling higher take rate. When you look longer term and when you're helping drive more demand for creators, is it right for us to think that your take rate could potentially move higher and towards more of the normal take rate for other marketplaces over time? Yeah, you know, that's a really interesting question. I'd say that I do think as we grow volume and we grow more, excuse me, share, we already have a high share of creators in our big markets, but as we even grow that more, I do think there is more ability to increase take rate just from pricing, from the Ticketing sales. A question also I think will be for us is how long is that trajectory? How big is it? How do you do it in a way that still shows that we are the best partner for those creators? Given what we learned with Organizer Fees, you know, that perception with creators is key, I think, for long-term success. One way to think about it, I'd say, is, if we continue to serve them really well, where so many of them never see the need to move off of our platform, then yes, over time, I think they could also feel and not have a negative sentiment about the price going up a bit over time. I think when you do that is, you know, I think you just got to be cautious, before doing that too soon. Right. Right. Need to become indispensable before doing. Yeah. Okay. Exactly. All right. Taking it a little bit closer. So, thinking through the numbers in 2025, we do have you returning to positive growth in Q4 this year, and the rationale is that you should have lapped all of the Organizer Fee-related headwinds by then. Is this a reasonable assumption to have? Is there anything else we should keep in mind as we think about how your top-line trajectory will look like in 2025? Yeah, you know, I'd say, you know, as we think about returning to growth, there's, you know, that piece we're referring to most specifically paid ticket volume growth, right? And I think, you know, we've talked, you know, as we chatted about a lot of the things we're doing to drive that. I would say that all the data is showing things are heading in the right direction. The challenge is often predicting the slope of the recovery, you know, and I think things are heading in the right direction, but different months can be choppy. You can see different things. What gives us comfort is the fact that things we're working on seem like they're the right things. It It feels like they are supporting both sides of the marketplace. Right now, it feels still reasonable that we're seeing trends that to return to paid ticket volume growth, you know, by the end of the year. Okay. I would say, the revenue piece, though, you know, you have to factor in the fact that Organizer Fees went away. And so that total revenue might not time exactly with that. Okay. That makes sense. And then, cost discipline. Yes. You know, putting on your CFO hat, like what, like how do you, how should we think about, like, the way you're managing costs right now? Do you think there's more opportunities to drive more efficiency from what you have? And looking out to when you recover, is there incremental investments that you feel is necessary for Eventbrite to go to that next step of becoming the marketplace? Yeah, this is something, as you can imagine, I think about a lot. I would say I feel that we are, you know, fully staffed today. It is just, I would say, a human nature or company nature that I don't think you'll ever hear a department leader say that they have more than enough people or not attribute an issue to not having enough people, right? There's always going to be that tension. Looking at kind of the size of our business, comps to the market, it feels like we should not need to grow our, I mean, our cost, you know, compensation is the biggest part of our OPEX, right? It doesn't feel like we need to grow our team overall to drive all the growth initiatives. I think what would make sense for us is to be really focused on the specific talent and what they're working on and at times reallocating. I do believe, you know, we have the ability to really grow revenue at a much faster rate than grow opex. Ideally, at some point, I think opex hopefully should only grow just by kind of inflationary adjustments for compensation or comp cycle increases and promotions, but not because of the team size growing. Okay. Is it safe for us to think that the bigger revenue scale should drive margin leverage and that'll be the biggest driver? Yeah, I think, you know, I think that'll be a very big driver. I do think returning to growth and getting to larger revenue scale with an OPEX base that is smaller than it's been in the past, that we plan to maintain that same type of discipline does lend itself for margin expansion. At the same time, there'll be some incremental lift as the revenue makeshift incorporates more of the Advertising revenue that also has a higher gross margin. I would say in the near term, the primary one is OPEX control. Okay. All right. Let's move to your balance sheet. So curious if there's any changes to how you guys are thinking about capital allocation. Yeah, this is also something, as you can imagine, I'm thinking a lot about. I would say one thing we wanted to really try to make clear, you know, in our earnings and just touch points like this is, you know, there could be overhanging questions about the capital allocation, the converts out there. As we see it, we have $551 million of cash. Now, we're not going to touch all of that. A lot of that is creator payables and is very secure. When you exclude all of that, and some of the restricted cash in there is actually tied to creator payables. It's not actually, so it's within that. There is $48 million of restricted cash in there, but that's tied to, you know, the payment, how we're handling payments with a vendor for those payables. That leaves $241 million of available liquidity, which at this moment actually happens to line exactly with the converts due. That is up $11 million from last quarter. As we think about it, we feel like we are well positioned to handle paying down that debt when it makes sense, when it is the most opportunistic, which is the $30 million due in December of this year and another $210 million-$211 million due in September 2026. For now, I think as we think about those pieces, we want to demonstrate that we have the flexibility to pay that down when we want to. At the same time, the 2026 notes are generating a lot of interest income for us. They are really low coupon. There is a nice spread there. As we generate, we have 15 quarters of positive adjusted EBITDA, right? We're going to generate more cash. We don't feel like there's an issue. On top of that, we do want to demonstrate that we have more security than that still. That's why we're also thinking about additional financing. There's no need for another $200 million. That was done at a time of zero interest rates. I'm glad it was done because it's some nice interest income we're making. The needs for debt, I would say, are multiples lower than that. For us, it's really going to be a desire of balancing the cost of that debt, the interest rate versus the flexibility it gives you. I envision a much smaller amount. And the way we would do that would be something that we're really focused on, it not being dilutive. We're aware of the share price. We don't want anyone or any investors to think that we feel that an equity-type situation or a new type of convert would be something that makes sense. The stock price is, we're very aware of where it's trading. Non-dilutive solutions are a big priority. I think when we do show that we have a path there and we gain the credibility for investors and analysts to be as confident as I feel about how secure we are, I think then we can, you know, think more about, you know, the share buybacks. I do believe our stock is traded, is priced fairly attractively. It is tempting to always look at that and be like, why not pick some of that up? The fact is, I think it's kind of an order of operation thing. We got to show that we can pay down the stuff we want to. We can get additional liquidity in a way that is not dilutive. Then we decide the best way to allocate capital, and when the foundation is really, it's really clear to everyone the foundation is secure. Okay. All right. We'll leave it there. Thank you all now for coming. Oh, thank you. Thank you, Dave. I really enjoyed the conversation. Likewise.