UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
For the quarterly period ended
OR
For the transition period from to _______
Commission file number:
(Exact Name of Registrant as Specified in Its Charter)
|
|
(State or other jurisdiction of |
(I.R.S. Employer |
(Address of principal executive offices) |
Zip Code |
Registrant's telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
Trading Symbol(s) |
Name of Each Exchange on Which Registered |
|
|
|
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period than the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
☐ |
☒ |
|
Non-accelerated filer |
☐ |
Smaller reporting company |
|
|
|
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). YES ☐ NO
As of October 25, 2023, there were
DAVE INC.
TABLE OF CONTENTS
|
|
Page |
PART I. |
1 |
|
|
|
|
Item 1. |
1 |
|
|
1 |
|
|
2 |
|
|
3 |
|
|
4 |
|
|
5 |
|
|
7 |
|
|
Notes to Unaudited Condensed Consolidated Financial Statements |
9 |
Item 2. |
Management's Discussion and Analysis of Financial Condition and Results of Operations |
34 |
Item 3. |
49 |
|
Item 4. |
49 |
|
|
|
|
PART II. |
51 |
|
|
|
|
Item 1. |
51 |
|
Item 1A. |
51 |
|
Item 2. |
51 |
|
Item 3. |
51 |
|
Item 4. |
51 |
|
Item 5. |
51 |
|
Item 6. |
51 |
|
|
53 |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (this “Form 10-Q” or this “report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are forward looking and as such are not historical facts. All statements contained in this Form 10-Q other than statements of historical fact, including statements regarding our future results of operations, financial position, market size and opportunity, our business strategy and plans, the factors affecting our performance, our objectives for future operations, our liquidity, borrowing capacity, our use of cash and cash requirements and the expected effects of new accounting pronouncements, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “should,” “would,” “can,” “expect,” “project,” “outlook,” “forecast,” “objective,” “plan,” “potential,” “seek,” “grow,” “target,” “if” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in the section titled “Risk Factors” set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (the “SEC”) on March 13, 2023 (the “Annual Report”). Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this Form 10-Q may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Forward-looking statements contained in this Form 10-Q involve a number of judgments, risks and uncertainties, including, without limitation, risks related to:
We caution you that the foregoing list of risks and uncertainties that may cause actual results to differ materially from those in the forward-looking statements may not be complete. You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements and our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.
Except as required by law, we do not intend to update any of these forward-looking statements after the date of this report or to conform these statements to actual results or revised expectations.
This report contains estimates, projections and other information concerning our industry, our business and the markets for our products. We obtained the industry, market and similar data set forth in this report from our own internal estimates and research and from industry research, publications, surveys and studies conducted by third parties, including governmental agencies. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. While we believe that the data we use from third parties are reliable, we have not separately verified these data. You are cautioned not to give undue weight to any such information, projections and estimates.
As used in this report, the “Company,” “Dave,” “we,” “us,” “our” and similar terms refer Dave Inc. (f/k/a VPC Impact Acquisition Holdings III, Inc. (“VPCC”)) and its consolidated subsidiaries, unless otherwise noted or the context otherwise requires. “Business Combination” refers to the business combination pursuant we consummated on January 5, 2022 pursuant to the Agreement and Plan of Merger, dated as of June 7, 2021 among VPCC, Dave Inc., a Delaware corporation, and other entities.
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
Dave Inc.
Condensed Consolidated Balance Sheets
(in thousands; except share data)
|
|
As of September 30, 2023 |
|
|
As of December 31, |
|
||
|
|
(unaudited) |
|
|
|
|
||
Assets |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Marketable securities |
|
|
|
|
|
|
||
Member advances, net of allowance for credit losses of $ |
|
|
|
|
|
|
||
Short-term investments |
|
|
|
|
|
|
||
Prepaid income taxes |
|
|
|
|
|
|
||
Prepaid expenses and other current assets |
|
|
|
|
|
|
||
Total current assets |
|
|
|
|
|
|
||
Property and equipment, net |
|
|
|
|
|
|
||
Lease right-of-use assets (related-party of $ |
|
|
|
|
|
|
||
Intangible assets, net |
|
|
|
|
|
|
||
Debt facility commitment fee, long-term |
|
|
|
|
|
|
||
Restricted cash |
|
|
|
|
|
|
||
Other non-current assets |
|
|
|
|
|
|
||
Total assets |
|
$ |
|
|
$ |
|
||
Liabilities, and stockholders’ equity |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
|
|
$ |
|
||
Accrued expenses |
|
|
|
|
|
|
||
Lease liabilities, short-term (related-party of $ |
|
|
|
|
|
|
||
Legal settlement accrual |
|
|
|
|
|
|
||
Other current liabilities |
|
|
|
|
|
|
||
Total current liabilities |
|
|
|
|
|
|
||
Lease liabilities, long-term (related-party of $ |
|
|
|
|
|
|
||
Debt facility, long-term |
|
|
|
|
|
|
||
Convertible debt, long-term |
|
|
|
|
|
|
||
Warrant and earnout liabilities |
|
|
|
|
|
|
||
Other non-current liabilities |
|
|
|
|
|
|
||
Total liabilities |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|||
Stockholders’ equity: |
|
|
|
|
|
|
||
Preferred stock, par value per share $ |
|
|
|
|
|
|
||
Class A common stock, par value per share $ |
|
|
|
|
|
|
||
Class V common stock, par value per share $ |
|
|
|
|
|
|
||
Additional paid-in capital |
|
|
|
|
|
|
||
Accumulated other comprehensive loss |
|
|
( |
) |
|
|
( |
) |
Accumulated deficit |
|
|
( |
) |
|
|
( |
) |
Total stockholders’ equity |
|
$ |
|
|
$ |
|
||
Total liabilities, and stockholders’ equity |
|
$ |
|
|
$ |
|
||
See accompanying notes to the condensed consolidated financial statements.
1
Dave Inc.
Condensed Consolidated Balance Sheets, Continued
(in thousands)
The following table presents the assets and liabilities of a consolidated variable interest entity (“VIE”), which are included in the condensed consolidated balance sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. All intercompany accounts have been eliminated.
|
|
As of September 30, 2023 |
|
|
As of December 31, 2022 |
|
||
|
|
(unaudited) |
|
|
|
|
||
Assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Short-term investments |
|
|
|
|
|
|
||
Member advances, net of allowance for credit losses |
|
|
|
|
|
|
||
Debt facility commitment fee, current |
|
|
|
|
|
|
||
Debt facility commitment fee, long-term |
|
|
|
|
|
|
||
Total assets |
|
$ |
|
|
$ |
|
||
Liabilities |
|
|
|
|
|
|
||
Accounts payable |
|
|
|
|
|
|
||
Long-term debt facility |
|
|
|
|
|
|
||
Total liabilities |
|
$ |
|
|
$ |
|
||
See accompanying notes to the condensed consolidated financial statements.
2
Dave Inc.
Condensed Consolidated Statements of Operations
(in thousands; except share data)
(unaudited)
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
||||||||||
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
||||
Operating revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service based revenue, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Transaction based revenue, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total operating revenues, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Provision for credit losses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Processing and servicing costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Advertising and marketing |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Compensation and benefits |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other (income) expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest income |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Legal settlement and litigation expenses |
|
|
|
|
|
|
|
|
- |
|
|
|
|
|||
Other strategic financing and transactional expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Changes in fair value of earnout liabilities |
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Gain on extinguishment of liability |
|
|
|
|
|
- |
|
|
|
|
|
|
( |
) |
||
Changes in fair value of derivative asset on loans to stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Changes in fair value of public and private warrant liabilities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total other expense (income), net |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Net loss before provision for income taxes |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Weighted-average shares used to compute net loss per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
See accompanying notes to the condensed consolidated financial statements.
3
Dave Inc.
Condensed Consolidated Statements of Comprehensive Loss
(in thousands)
(unaudited)
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
||||||||
|
|
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
2022 |
|
Net loss |
|
$ |
( |
) |
$ |
( |
) |
|
$ |
( |
) |
$ |
( |
) |
Other comprehensive gain (loss): |
|
|
|
|
|
|
|
|
|
|
||||
Unrealized gain (loss) on available-for-sale securities |
|
|
|
|
( |
) |
|
|
|
|
( |
) |
||
Comprehensive loss |
|
$ |
( |
) |
$ |
( |
) |
|
$ |
( |
) |
$ |
( |
) |
See accompanying notes to the condensed consolidated financial statements.
4
Dave Inc.
Condensed Consolidated Statement of Stockholders’ Equity
(in thousands, except share data)
(unaudited)
|
Common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Class A |
|
|
Class V |
|
Additional paid-in capital |
Loans to stockholders |
|
Treasury stock |
|
Accumulated other comprehensive loss |
|
Accumulated deficit |
|
Total stockholders’ equity |
|
||||||||||||||||
|
Shares |
|
Amount |
|
|
Shares |
|
Amount |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance at January 1, 2023 |
|
|
$ |
|
|
|
|
$ |
- |
|
$ |
|
|
$ |
- |
|
$ |
- |
|
$ |
( |
) |
$ |
( |
) |
$ |
|
|||||
Issuance of Class A common stock in connection with stock plans |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
- |
|
|
|
||||
Payment for fractional shares after reverse stock split |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
( |
) |
|
|
- |
|
|
- |
|
|
- |
|
- |
|
|
( |
) |
|
Stock-based compensation |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
- |
|
|
|
|||
Unrealized gain on available-for-sale securities |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
|||
Net loss |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
( |
) |
|
( |
) |
Balance at September 30, 2023 |
|
|
$ |
|
|
|
|
$ |
- |
|
$ |
|
|
$ |
- |
|
$ |
- |
|
$ |
( |
) |
$ |
( |
) |
$ |
|
|||||
|
Common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Class A |
|
|
Class V |
|
Additional paid-in capital |
Loans to stockholders |
|
Treasury stock |
|
Accumulated other comprehensive loss |
|
Accumulated deficit |
|
Total stockholders’ equity |
|
||||||||||||||||
|
Shares |
|
Amount |
|
|
Shares |
|
Amount |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance at January 1, 2022 |
|
|
$ |
|
|
|
|
$ |
- |
|
$ |
|
|
$ |
( |
) |
$ |
( |
) |
$ |
- |
|
$ |
( |
) |
$ |
|
|||||
Issuance of Class A common stock in connection with stock plans |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
- |
|
|
|
||||
Issuance of Class A common stock pursuant to the PIPE financing |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
|||
Issuance of Class A common stock pursuant to the Merger Agreement |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
( |
) |
|
|
|
|
- |
|
|
- |
|
|
- |
|
|
( |
) |
||
Exercise of Series B-1 preferred stock warrants, net of settlement |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
|||
Conversion of 2019 convertible notes and accrued interest to Class A common stock |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
|||
Repurchase of Class A common stock |
|
( |
) |
|
- |
|
|
|
- |
|
|
- |
|
|
( |
) |
|
|
- |
|
|
|
|
- |
|
|
- |
|
|
( |
) |
|
Exercise of warrant for Class A common stock |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
Stockholder loans interest |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
( |
) |
|
- |
|
|
- |
|
|
- |
|
|
( |
) |
Exercise of derivative asset and paydown of stockholder loans |
|
( |
) |
|
- |
|
|
|
- |
|
|
- |
|
|
( |
) |
|
|
|
|
- |
|
|
- |
|
|
- |
|
|
( |
) |
|
Extinguishment of liability |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
- |
|
|
|
||||
Stock-based compensation |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
- |
|
|
- |
|
|
- |
|
- |
|
|
|
|||
Unrealized loss on available-for-sale securities |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
||||||||||||