Thoughtfully vetted and curated products for every room in your home. We are certainly very happy to have Grove present for the first time at our conference, and it is my pleasure to introduce CEO Jeff Yurcisin, as well as Interim CFO Tom Siragusa. The format for today will be a management presentation for the first 20 or so minutes, followed by Q&A for those in the audience that, if you have a question, please type it into the Q&A box at the bottom of your Zoom screen, and I'll read the question out loud after management goes through the slide deck. With no further delay, Jeff, the floor is yours. Thank you, Anthony. Thank you, Siddharthi. This is a very well-run conference and appreciate it. Let's jump in. My name's Jeff, and I'm not here to run a microcap company. It's just the truth. I've spent the last 20 years focused on e-commerce and D2C. I was raised at Amazon. Andy Jassy, the current CEO, was my first mentor. I think I know how they think. I am here just like most of our employees because we believe that there is something bigger than ourselves, that the private sector can be a force for good, and that there's a customer base out there large enough to serve in a very differentiated, high-competitive space, to serve a conscientious consumer who cares about environmentally sustainable products. Let's jump in. Grove, here's our story, and I'll explain why I'm energized, why I've joined, and why our board is focused on delivering the right type of shareholder returns. This is where we are. This is where we're going. Your home, your family, your planet, healthier. One of my investors uses the phrase "a non-toxic Amazon." There's just a world out there for a customer who's looking for a more curated set of products than what you can find on Amazon or other big marketplaces. What we're doing is we're sprinting after this space, a box of household essentials that will make your home, your family, your planet healthier. In terms of our turnaround, it's worth just talking about some of the phases that we've gone through. The first is the vision. The founder raised $600 million. He said, "We're going to the moon." He literally was trying to figure out how to get to a billion dollars as fast as possible. Very large valuations. We went public via SPAC, and then all of a sudden, we realized we can't keep raising money. The board asked him to step aside. He kind of hired me. I have a 100% new leadership team from when I joined in 2023, and what you will see is that we fundamentally changed the business. We are kind of delivering from being unprofitable and losing $100 million a year to being break-even, from a heavy debt load on our balance sheet to being relatively clean. Most importantly, we focus on transforming the customer experience. We'll walk through what that means, what that looks like, and why we're energized about it. Let's get into numbers. Here's the journey. I don't know how many of you have invested in D2C companies, but at a high level, it is worth noting that in D2C companies, when you spend on marketing and advertising, you can drive short-term revenue growth, but you also have an overhang in future years. Just take a look at what happened. From a revenue perspective, we benefited from the pandemic bump, but even before the pandemic bump, we were spending $100 million a year on marketing. We were losing $145 million in 2019 and continued to lose money until we realized, "Hey, look, first, let's prove to investors that we will be profitable. Let's prove to them that we can run this business well." I joined in the back half of 2023. When you look at the revenue arc, very important to take away is that when you spend on these marketing dollars big in 2020 and 2021, and actually the last one was Q1 2022, there's an overhang in revenue from some of those customers who are still purchasing that you acquired in that Q1 2022 and future quarters. However, there's an asymptotic. After 8 quarters-1 0 quarters, it kind of serves as a plateau. What you're seeing in the last few years of revenue is the arc of coming down from that marketing spend from prior years and complemented with a true discipline in how we run the business while giving us time to transform the business and build a new experience. What is this new experience? We want to be that leading platform for conscientious consumers. There are three big elements. First is around vetted essentials. This is not a marketplace where anyone can load their product. This is a marketplace where buyers touch every single product. They are picking the best of the best products, which leads to number two with a very high standard. As a matter of fact, we choose to have some of the highest standards in the industry from a health, sustainability, and performance perspective. Three, this is one of the great benefits from our legacy. When we were spending $100 million in advertising, do you know what else we were doing? We're measuring the amount of plastic in every single product that we sell. No one else does this. Why do we measure it? Because plastic is bad. Because we've been lied to for a generation. Truly, go back into the DuPont libraries of the 1970s, and you will see that they knew that those little chasing arrows were not really going to lead to recycling plastic, that we would burn it, ship it overseas, throw it in the ocean, but very little of it gets recycled, actually less than 9%. We took all of that momentum on the plastic. We were the first plastic-neutral retailer, the only one to measure. Whenever we do sell plastic, we take it out of the ocean. Now, what does that mean? When you think about the tailwinds that exist for our business, there are two big things I want to highlight. One is in that older business, we had a forced subscription, a default subscription business where customers would only be able to purchase if they signed up for subscriptions. That and selling kind of, you know, refillable containers limited our market to about 5 million customers. Now we believe there are 57 million that have purchased environmentally or sustainable products in the last 12 months. Think of this as a Whole Foods customer on the produce side who's just looking for someone somewhere to do the work for them, to curate the best of the best products. What type of tailwinds exist? Look, I don't care who's president. I don't care if it's red or blue. The reality is we are learning more month over month about the crisis that we're in. That crisis is like, hey, sustainability matters. Talk to your kids. Listen to what they're saying about how they think about carbon and plastic. Now the plastic story, that tailwind is getting out. I encourage you to take a look at the New York Times article from last Sunday that talked about plastic pollution, or look at the Fox News articles on microplastics, or the New York Post in the last two weeks. The reality is we're a generation not knowing about plastics, and now we're aware of microplastics. Some of you might be chopping on metal or bamboo wooden boards, which thank God. Some of you may be like, hey, look, I don't know, there's still lots of plastic in our world. I strongly encourage you not to mix plastic and heat. This concept of microplastics being everywhere, realizing they're not that different than styrofoam, they just kind of disintegrate. They are literally, my favorite statistic is 0.5% of our brains is plastic. Plastic's in breast milk. It's in testicles. It's around our blood. More and more studies are coming out saying that this has real harmful impacts. Let's keep going. Okay, Jeff, maybe there's a secular tailwind. Tell me, how are you going to serve this customer? What does this look like? We believe it starts with trust. We believe it starts with product, but we have to have a platform that scales. The first thing that we're doing is we're building that platform. We didn't have a scalable platform when I arrived. Some of you are like, hey, look, but you're at $200 million. You're barely growing. We will be growing. We're guiding towards growth in Q4, and we need to find a platform that can win in the long term. Secondly, we need to keep those really high standards in terms of curation and the best household essentials. We're doing that. Whenever we add more product, guess what? Customers kind of love it. It gives customers more reason to shop. It gives customers more reasons to add more items and increase their average order value, which we'll talk about in a second, is a critical input to having the economics work. Lastly, on the third side, we're building customer love. We are not having this default subscription that annoyed some customers. We are opened up to the world. We offer a value proposition that leads with content, leads with trust, but then is supported by the idea we are the place where values meet value. We aren't trying to overcharge our customers and we think we have an economic model to do it. The next question is, how do you do it? Amazon's a behemoth. It's hard to compete with them. I actually think we can and do it pretty well. There are a few things I want to highlight. A, this team, top performing team, using data science, driving the right type of LTV to CACs, which is a critical element. I actually want to emphasize more on the operations and the average order size. We have two fulfillment centers that we run. There's no 3PL that you have a higher cost structure. We run these. The magic in our business that very few people are able to do is that we're not shipping individual items. We're literally shipping boxes filled with 7, 8, 9, 15 type of units in those boxes. How do we get to 7 units - 15 units in a box in an order? It's a different shopping experience. It's one built around a customer need of often a woman. 95% of our customers are women. It is the leader of a household who's trying to make the right type of purchase decision for their family. What they use is subscriptions to say, "Hey, I know I'm going to need the tree, the bamboo kind of toilet paper, the tree-free kind of paper products," or "I know I'm going to need my kids' vitamins," or "I'm going to know I'm going to need my supplements or my shampoo bar in my shower." What they'll do is they'll subscribe to them. We have this subscription experience that enables customers to push off subscriptions another month, another two months, whatever it is. Our math is because we know that that box is going out the door next week, we are able to deliver a great customer experience with low shipping costs because we add so many items into that box and because it is a planned shipment. It is very different than the transactional e-commerce companies that exist today that are just fighting to just get that next purchase in that next period of time. With that context, the next important lever that's driving our growth and will continue to be important for years to come is human health. In our mission, dating back to when the founder created the company, it was, "Hey, we're going to win on human and environmental health." The reality is for a majority of our existence, we focus on environmental health. Now it's all like we are trying to rebalance to human health, and our customers appreciate it, ask us for more. I've got a board member, John Replogle. I encourage you to look at our board while you're listening to me. This is a top board. This is not a microcap board. We are here to build something long-term and meaningful to customers and think we have a path. John had been the CEO and founder of Seventh Generation, CEO of Burt's Bees, and he's kind of like the godfather in the natural product space. He's been telling me since I've joined, "Human health is the path. Customers care more about their own health than they do environmental, though we say sometimes we care about environmental health." The question is, where do you go? If you want the best products that you're putting into your body, where do you go? This is where we're running. What have we done? We've been leaning into VMS, but also into some of those bamboo cutting boards and other things that drive great wellness. In the last few years, we've added 100+ brands. Every brand that we reach out to basically says, "Yeah, I'd love to sell you." What you see in the middle chart is when we add selection, we end up driving higher AOV and more revenue. On the far right, you see our VMS shows that when we're looking at LTV to CAC, specifically within customers who are buying VMS, vitamins, minerals, supplements, we see greater loyalty, greater returns, and we're driving that up into the right quarter-over-quarter. The next question that when I think about this business and one of the reasons I joined is because of this own brand business. In the long term, like look, you need to have the economics to compete with Amazon. You need to have a specific customer segment, customer cohort that you're going to serve better than anyone in the world. For the economics to work, it's also really great to have an own brand business that can give you 60%-70% gross margins. Think of this less private label because private label often just is a copycat and often sells items at lower prices. Think of this as a tip of a spear sustainable brand that we offer. On the left side, we were leading with concentrates. I encourage all of you to try these laundry detergent sheets, one of my favorite products, refillable aluminum. Aluminum is infinitely recyclable while plastic doesn't get recycled, or if it does, maybe once. We moved into bamboo-based products, frequently used items, good kind of content telling these stories, whether it's for the bamboo kind of kitchen utensils. In the last 12 months, we started finding another way to grow, to build our kind of moat because these are our brand products to expand gross margin, and it is with acquisitions. Every month, Tom and I get pinged by 1 company-4 companies every month. "Hey, will you buy us?" The reason they're asking that is because they're just subscale. Their SG&A as a percentage of revenue is too high. Their cost to acquire customers is too much. There could be opportunities regularly, consistently in front of us for the next few years of picking up brands that make sense for us that you may be able to acquire at roughly the value of inventory or even less. You're not buying the companies. You're buying their assets. You're building them onto this platform, and you're driving growth. Just for instance, 8Greens. I take this every morning. It's a story of a 25-year-old founder who's now British royalty. She was on the Today Show this morning talking about 8Greens and Grove. She was on QVC over the weekend. She's passionate about this space, and we're able to partner with someone like her, bring her into our family of brands, drive higher gross margin, and greater long-term stickiness. We need to talk about content because content is also part of the why. This is how you differentiate from other e-commerce players. You're authentic with your real blog and talking about social and on the social channels, talking about what really matters to these customers. You're moving into very rich, content-filled, dense pages that are explaining the why behind, "Hey, why do you want to purchase magnesium? How do you use some of these supplements?" All of that, we're just trying to be transparent, science-based, and there is a customer focused on that. Tom, I'm going to keep taking this if that's okay. I'm going to have you kind of jump in on FAQs. Look, let's talk to us a little bit about our results. Revenue, quarter-over-quarter grew, year-over-year, still down 15%. Probably not that exciting to you guys. I get it. We are guiding towards Q4 growth, and I'll explain why. Gross margin up year-over-year. EBITDA, like basically break even, losing $1 million, but we've been around break even for the last two-ish years. Operating cash flow positive. We're running with discipline. We are running, driving faster turns, trying to get to a negative cash conversion cycle. We're not there yet, but we believe that we can scale in a positive way because of how we run this business. Let's take a look at EBITDA. This is a story, look to the left of this chart. If we even showed 2021 and 2020, you can look at our quarterly, but we were losing $30 million a quarter. How many of us still exist? I don't know if most should have, but this team actually took some of the really hard medicine, went through the risks, negotiated every element of the P&L, drove higher gross margins while in process, rebuilding a customer's experience and focusing, building basically a new growth, a new business for customers. Here you'll see over the last eight quarters, a consistent kind of break-even type of world. Operating cash flow can go up and down, but again, over the last eight quarters, you'll see kind of really strong operations. The handful of big spikes negative in the last two years were tied to either renegotiating out of a headquarters lease that was really punitive for a company that's really virtual, and then the working capital from some of the acquisitions that we had acquired in Q1. Again, from a gross margin perspective, effectively up into the right, we are managing this business better. I believe we have the economics and the contribution profit per box to make all of the math kind of work for us. Now this, we're not going away. We had $79 million of debt, $72 million in long-term debt, $55 million of a minimum cash covenant. It was so punitive. Look at the interest rates, $4 million a quarter, $16 million a year, $16 million, but I was only able to use about $17 million of that $72 million minus $55 million of cash. We were paying $16 million. That's how desperate we were years ago when our back was up against the wall. I think if you were to look at the arc of some of these SPACs and those that have gone bankrupt, etc., they've been burdened by some of this debt and they go under. We decided to get rid of the long-term debt. We knew it was punitive as soon as we could. As we hit our minimum kind of payments, we got out of it. We've raised two pipes in the last two-ish years, and both of those pipes have been at premiums on the stock price. Like it is hot. We have plenty of investors who want to buy more and more share of this at the current prices. Like we're just trying to hold the line and not dilute. Speaking of this, I think this is probably the right time. One of my board members just like emphasizes to me, "Jeff, this is just asymmetric. There's asymmetric upside here. Like what's the worst case? You don't have a lot of debt. That's kind of taken care of. You're not like a going concern and you're guiding towards growth. At some point in time in this microcap space, people will see and will care. Until that time, I'm trying not to dilute. I don't want to dilute. Like I think that is we're not at the right kind of valuation, but what I see in the future is a world, and I spoke about this on our earnings call. Imagine we're a $300 million plus company. Imagine that we're growing year-over-year, maybe double digits in a few years, and then you're break even. What multiple would you put on that? Jeff, prove to me that you're actually going to grow. Stop this hand-waviness. Guess what? This is the first time you guys are seeing us, partly because Tom and I have not been on these road shows. We haven't been on these road shows and talking to investors because we haven't had the story. Here is the story. Look at 2024. This is not a seasonal business. Q4 is inherently better than Q1. That kind of arc was tied to the cohorts that I described. Now look at 2025. Q1 is the trough, growing sequentially in Q2, growing sequentially in Q3, growing sequentially in Q4. As we go into 2026, we have yet to give guidance, but in 2024, we're saying we will be growing year-over-year. Q1 was the trough, and now it's onward and upward. That's the way we think about this business. What I can tell you is what I believe, is I'm not here to run this small business. Neither is our Board or our management team. We see a really big upside. We see a world where we're able to capture that value because we are serving, we've got a business that is different, and we are serving a customer in a business better than anyone else can serve that customer. We think we have the economics to do it on an order basis. We've paid down the debt. We're growing year-over-year. This is why we believe we can deliver phenomenal returns to customers while still maintaining our mission and having that mission be part of our differentiation. We'd love to take any questions that are coming in. Oh, good. We've got a few coming in. Thank you. Yes, Jeff, you can see the questions already. If you want to just look at the questions or maybe I'll just read the questions so everybody else can hear them actually. I guess, in terms of just thinking about the product mix, as you pointed out, 95% of your customers are, sorry, I forgot to turn off my video. There's 95% of your customers are women. I guess the question is whether you plan to expand your offerings to more men. I'm curious. The short answer is no. Look, we are going to expand our offerings for customers as a conscientious consumer. I strongly believe, and if that's male or female, I don't care. We don't care. We will have offerings that appeal from a personal care side, but most of our products really are about household essentials. Candidly, right now in our society, women still carry more of the mental load and make those purchase decisions more than men. We aren't trying to target women, but what we see is that is the right path to serve a customer. I do want to emphasize, D2C companies will lose, in my opinion, if they do not have a differentiated customer that they are serving better than anyone in the world. Amazon is just too big. I think we have that. I think we have the economics to deliver it. That's what we're going to go much down. I'll read this out loud. Can you talk about your current deal pipeline? Has anything changed with the new world trade environment and market volatility the last four to five months? Good question. It's funny. We started, the first set of tariffs that impacted us were bamboo related products. 80% of the world's bamboo is made in China, and those were some of the first tariffs that hit. I need to be really open. In our business, these tariffs are not really impacting us much. Yes, it's a macro trend, but it may create a few little headwind, small percentage points of headwind. We see a world where we're a $300 million company in the medium term. That's a world. That's why I'm here. $300 million, $400 million, growing double digits. Where we see the opportunity when we add more VMS products, when we add new great brands, when we find more influencers talking about our product online, we're seeing more upside to those things than any of the macro headwinds. Specifically around the deal space, I would say that there are just a bunch of subscale players that either haven't made the hard decisions that we've made, or they're just smaller. They may have a great product and a great brand and they're great founders, but they're realizing it's hard to make as much money as they thought on Amazon. It probably follows the arc a little bit of the aggregators on Amazon and what has happened to many of those players. What we're just seeing is a lot of these kind of companies. Most of the opportunities we see are in the $5 million - $20 million in revenue range. Every now and then, some larger players are trying to figure out, "Hey, how do you handle this?" Can we talk to the balance sheet? Are there options or dilutive securities outstanding? I can't wait to introduce you guys to Tom Siragusa. Mr. Tom, I'll let you take it away and I'll take us to the balance sheet. Yeah, that sounds good. There are a few ways that we kind of look at our cap table. We have about $41 million of common stock that's outstanding. We have $12.5 million of preferred that converts one-to-one to common stock. For those that go really deep into our 10-Q, we do have some warrants that are outstanding. There's about $2.5 million related to the SPAC from a couple of years ago when we went public at a much higher valuation. They're significantly out of the money with an exercise price close to $60. There's about $800,000 of warrants related to Virgin that are in the money that they could exercise. As it relates to just the total amount of shares that are outstanding, those are the buckets that we really focus on. Great. Thank you, Tom. The last question, by the way, we are really open. The question reads, "Your enthusiasm is obvious. Over the short term, what are you most excited about as you continue to roll out Growth Strategy?" We are finally fixing the core business. We didn't have a sustainable business in 2023. We really didn't. It was a different leadership team. Actually, the board turned over quickly and significantly in 2022, a different CEO. Candidly, we are seeing growth. I know most of the people on this call are probably more investors than operators, but those of you who've been operators, you know what growth can do. It doesn't just deliver returns to shareholders. It enlivens teams. It energizes. That is what we are seeing in the short term. If the question's more specific, Jeff, tell me tangibly, how the heck are you going to grow? There are probably two things I want to emphasize. One, you do it organically. This is my Amazon training. Just go build the best customer experience for a specific customer segment. Just go do that. That is a durable long-term competitive advantage. I think of that as moats. There is a faster, quicker way. In my first year on the role, I was encouraged to look at a company that was driving hundreds of millions of revenue, that was looking at selling themselves in a distressed state. We pursued it. Didn't make sense. Didn't make sense. It would have changed who we are. What I'm energized by is we increasingly are seeing it would have not just changed who we are. It just wasn't the right type of decision for this company and where we were going. Now we are seeing companies that their assets could be pretty valuable to us. As we are fixing the platform, building this long-term durable kind of ability to serve customers better because of our fulfillment center structure, because of the way we serve customers with all of these subscriptions, with a large order of value size, with real innovative approach to marketing and finding the seams that really work. This is not a world where we are just handing Meta and Google a large checkbook and letting them take our consumer surplus. This platform has all of these elements: operational, cultural, marketing, the order economics, all of that is there. We're just seeing real interesting ideas on this accelerant that are more logical in terms of how we would integrate with them and in our ability to pursue and serve this conscientious consumer. Will you need to raise capital? Thank you. Will you need to raise capital in the next 18 months? Are you committed to keeping the balance sheet clean? Now we're getting into real questions. My number one investor is Volition Capital, Larry Chen. He is on my board. He is my smartest board member, one of on D2C. The way he thinks about returns and the get 10x returns are you either grow revenue, you get different multiples, or you and/or you dilute. When you dilute, you have to kind of drive the other two fast, higher and faster to deliver 10x. I have no interest in diluting at this current valuation. Candidly, I think you guys tell me, like if we're really delivering Q4, if we're really growing and we're break even and clean on cash flow and a clean balance sheet, what kind of multiple should we be if people were really watching? I think at some point, I would hope if we deliver on this, we get repriced. I do want to emphasize, so I'm trying to answer this question that we have strong inertia to not dilute, to not like raising more capital. I hate the idea of diluting anywhere close to this valuation. We don't really have a need. There is a path going down this organic path that we can deliver strong shareholder returns without diluting. I am not saying on this call we won't because we need to keep that option open. There is potentially a world where you look at some of these more aggressive acquisition opportunities coming in front of us that maybe we would have to raise some money. I believe all of this is with a lens of from a shareholder value perspective. I want to kind of, are we probably at time? How are we doing on time? Yeah, we're pretty much out of time, but you know, go ahead and finish. I'll finish my last thought. I started by saying I'm not here to run a microcap company. I'm not. I'm also not planning on leaving anytime soon. My team and I see this real path. We don't plan on, we see a real path to delivering this customer experience that's strong, delivering great return for shareholders, kind of serving our purpose and mission. We believe there are secular tailwinds behind that. We know someone is going to build that non-toxic Amazon. I would just close with, yes, we will always look at potential accelerants, and we are more actively looking at them because the market is bringing them to us. Maybe last 10 seconds, Anthony, remember we haven't been doing these until this month. We haven't because we did not believe growth was around the corner and that we deserved more investor attention. I think this is the time. Gotcha. We hope that you will join us for our next conference in December for sure. We'll have some more next year as well. Thank you very much, Jeff and Tom, for sharing the growth story. Certainly very interesting. You know, look forward to getting an update next quarter on that. Thank you also, everyone listening and asking thoughtful questions as well. With that, we'll wrap it up and enjoy the rest of your day. Thank you very much. Thank you all. All right, take care. Thank you.