Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

The newsletter platform built for growth.
beehiiv is a newsletter platform that helps creators design and publish content and monetize their audience. The Company primarily earns revenue through a subscription model where customers pay for access to advanced features on the platform and the ability to send to larger audiences. Additional revenue is earned through advertisements placed in newsletters and commissions earned through a customer referral marketplace. The Company's has a remote workforce across the United States and a global customer footprint.
Milestones

beehiiv Inc was incorporated in the State of Delaware in June 2021.

Since then, we have:

• Closed approximately $32M (of $33M) in financing for our Series B round, led by New Enterprise Associates (NEA) in April 2024
• Recently surpassed over 1 billion emails sent in a single month by our users through the platform
• Founded by a team of early employees of Morning Brew who led product, engineering, and growth
• $12M annual revenue run rate, a 450% increase YoY
• The beehiiv Ad Network has paid publishers over $1M since launching in 2023

Historical Results of Operations

Our company was organized in June 2021 and has limited operations upon which prospective investors may base an evaluation of its performance.

• Revenues & Gross Margin. For the period ended December 31, 2023, the Company had revenues of $4,726,783 compared to the year ended December 31, 2022, when the Company had revenues of $269,333. Our gross margin was 95.43% in fiscal year 2023, compared to 50.25% in 2022.
• Assets. As of December 31, 2023, the Company had total assets of $13,205,594, including $12,793,798 in cash. As of December 31, 2022, the Company had $2,134,068 in total assets, including $2,110,236 in cash.
• Net Loss. The Company has had net losses of $3,701,172 and net losses of $1,900,074 for the fiscal years ended December 31, 2023 and December 31, 2022, respectively.
• Liabilities. The Company's liabilities totaled $2,411,406 for the fiscal year ended December 31, 2023 and $1,746,901 for the fiscal year ended December 31, 2022.

Liquidity & Capital Resources

To-date, the company has been financed with $44,491,047 in equity and $2,906,265 in SAFEs (which have all subsequently converted into equity).

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 60 months before we need to raise further capital.

We plan to use the proceeds as set forth in this Form C under "Use of Funds". We don’t have any other sources of capital in the immediate future.

We will likely require additional financing in excess of the proceeds from the Offering in order to perform operations over the lifetime of the Company. We plan to raise capital in 60 months. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from the offering. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.

Runway & Short/Mid Term Expenses

beehiiv Inc cash in hand is $42,651,377, as of April 2024. Over the last three months, revenues have averaged $879,814/month, cost of goods sold has averaged $417,884/month, and operational expenses have averaged $1,154,716/month, for an average burn rate of $692,786 per month. Our intent is to be profitable in 8 months.

Since the date our financials cover, we have increased revenues and expenses as we invest more in R&D and sales and marketing to fuel this period of growth. We closed a $32M Series B round.

We expect to reach revenues of $11 million over the next 3-6 months across all of our product lines.  During the same period, we expect expenses to be roughly $17 million.

We are not currently profitable, and are continuing to operating at a net loss as we invest more in R&D and sales and marketing to fuel this period of growth. We expect to become profitable in mid 2025.

We have raised capital through top-tier venture capital investment firms. We have enough runway for several years.

All projections in the above narrative are forward-looking and not guaranteed.