Filed by Sandbridge Acquisition Corporation
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: Sandbridge Acquisition Corporation
Commission File No. 001-39516
Analyst Day Presentation 1
2 About this PresentationThis investor presentation ("Presentation") does not constitute (i) a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the proposed Business Combination or (ii) an offer to sell, a solicitation of an offer to buy, or a recommendation to purchase any security of SAC, the Company, or any of their respective affiliates. No such offering of securities shall be made except by means of a prospectus meeting the requirements of section 10 of the Securities Act of 1933, as amended.Forward Looking StatementsCertain statements, estimates, targets and projections in this Presentation may be considered forward-looking statements. Forward-looking statements generally relate to future events or involving, or future performance of, Sandbridge Acquisition Corporation ("SAC") or Owlet Baby Care Inc. (the "Company"). For example, projections of future EBITDA, statements regarding anticipated growth in the industry in which the Company operates and anticipated growth in demand for the Company’s products, projections of the Company’s future financial results and other metrics, the satisfaction of closing conditions to the pending business combination between SAC and the Company (the "Business Combination") and the timing of the completion of the Business Combination are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “pro forma”, “may”, “should”, “could”, “might”, “plan”, “possible”, “project”, “strive”, “budget”, “forecast”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential” or “continue”, or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward looking statements.These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by SAC and its management, and the Company and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: the occurrence of any event, change or other circumstances that could give rise to the termination of the Business Combination Agreement or could otherwise cause the transactions contemplated therein to fail to close; the outcome of any legal proceedings that may be instituted against SAC, the Company, the combined company or others following the announcement of the Business Combination and any definitive agreements with respect thereto; the inability to complete the Business Combination due to the failure to obtain approval of the stockholders of SAC, or the Company to obtain financing to complete the Business Combination or to satisfy other conditions to closing; changes to the proposed structure of the Business Combination that may be required or appropriate as a result of applicable laws or regulations or as a condition to obtaining regulatory approval of the Business Combination; the ability to meet stock exchange listing standards following the consummation of the Business Combination; the risk that the Business Combination disrupts current plans and operations of the Company as a result of the announcement and consummation of the Business Combination; the ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; costs related to the Business Combination; the regulatory pathway for Owlet products and responses from regulators, including the U.S. Food and Drug Administration and similar regulators outside the United States; changes in applicable laws or regulations; the possibility that the Company or the combined company may be adversely affected by other economic, business, regulatory, and/or competitive factors; the Company’s estimates of expenses and profitability; the evolution of the markets in which the Company competes; the ability of the Company to implement its strategic initiatives and continue to innovate its existing products; the ability of the Company to defend its intellectual property and satisfy regulatory requirements; the impact of the COVID-19 pandemic on the Company’s business; and other risks and uncertainties set forth in the section entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in SAC’s registration statement on Form S-4, which was filed with the SEC on March 31, 2021 and amended on May 28, 2021, including those set forth under “Risk Factors” therein, and other documents filed to be filed with the SEC by SAC.Nothing in this Presentation should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Neither SAC nor the Company undertakes any duty to update these forward-looking statements.Use of ProjectionsThis Presentation contains financial forecasts for the Company with respect to certain financial results for the Company’s fiscal years 2020 through 2025. Neither SAC’s nor Company’s independent auditors have audited, studied, reviewed, compiled or performed any procedures with respect to the projections for the purpose of their inclusion in this Presentation, and accordingly, they did not express an opinion or provide any other form of assurance with respect thereto for the purpose of this Presentation. These projections are forward-looking statements and should not be relied upon as being necessarily indicative of future results. In this Presentation, certain of the above-mentioned projected information has been provided for purposes of providing comparisons with historical data. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the prospective financial information. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of the Company or that actual results will not differ materially from those presented in the prospective financial information. Inclusion of the prospective financial information in this Presentation should not be regarded as a representation by any person that the results contained in the prospective financial information will be achieved. Disclaimers
Non-GAAP Financial MeasuresThis Presentation also includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including, but not limited to, EBITDA and certain ratios and other metrics derived therefrom. These non-GAAP financial measures are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing the Company’s financial results. Therefore, these measures should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity or performance under GAAP. You should be aware that the Company’s presentation of these measures may not be comparable to similarly-titled measures used by other companies. SAC and the Company believe these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. SAC and the Company believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends, and in comparing the Company’s financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures. Additionally, there can be no assurance that the Company will not modify the presentation of these or similar non-GAAP measures in the future, including to make adjustments for future expenses or other items that the Company believes are appropriate in comparing its operating performance across reporting periods on a consistent basis.This Presentation also includes certain projections of non-GAAP financial measures. Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from these projected measures, together with some of the excluded information not being ascertainable or accessible, SAC and the Company are unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable effort. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included.Industry and Market DataIn this Presentation, the Company relies on and refers to certain information and statistics obtained from third-party sources which it believes to be reliable. Neither SAC nor the Company has independently verified the accuracy or completeness of any such third-party information.TrademarksThis Presentation may contain trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners. Solely for convenience, some of the trademarks, service marks, trade names and copyrights referred to in this Presentation may be listed without the TM, SM, © or ® symbols, but SAC and the Company will assert, to the fullest extent under applicable law, the rights of the applicable owners, if any, to these trademarks, service marks, trade names and copyrights.Additional InformationSAC intends to file a registration statement on Form S-4 with the Securities Exchange Commission (the “SEC”), which will include a proxy statement/prospectus, that will be both the proxy statement to be distributed to holders of SAC’s Class A common stock in connection with its solicitation of proxies for the vote by SAC’s stockholders with respect to the Business Combination and other matters as may be described in the registration statement, as well as the prospectus relating to the offer and sale of the securities to be issued in the Business Combination. After the registration statement is declared effective, SAC will mail a definitive proxy statement/prospectus and other relevant documents to its stockholders. This Presentation does not contain all the information that should be considered concerning the proposed Business Combination and is not intended to form the basis of any investment decision or any other decision in respect of the Business Combination. SAC’s stockholders and other interested persons are advised to read, when available, the preliminary proxy statement/prospectus included in the registration statement and the amendments thereto and the definitive proxy statement/prospectus and other documents filed in connection with the proposed Business Combination, as these materials will contain important information about the Company, SAC and the Business Combination. When available, the definitive proxy statement/prospectus and other relevant materials for the proposed Business Combination will be mailed to stockholders of SAC as of a record date to be established for voting on the proposed Business Combination. Stockholders will also be able to obtain copies of the preliminary proxy statement, the definitive proxy statement and other documents filed with the SEC, without charge, once available, at the SEC’s website at www.sec.gov, or by directing a request to SAC’s secretary at 1999 Avenue of the Stars, Suite 2088, Los Angeles, CA 90067, (424) 221-5743.Participants in the SolicitationSAC and its directors and executive officers may be deemed participants in the solicitation of proxies from SAC’s stockholders with respect to the proposed Business Combination. A list of the names of those directors and executive officers and a description of their interests in SAC is contained in SAC’s prospectus dated September 14, 2020 relating to its initial public offering, which was filed with the SEC and is available free of charge at the SEC’s web site at www.sec.gov. To the extent such holdings of SAC’s securities may have changed since that time, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. Additional information regarding the interests of such participants will be contained in the proxy statement/prospectus for the proposed Business Combination when available.The Company and its directors and executive officers may also be deemed to be participants in the solicitation of proxies from the stockholders of SAC in connection with the proposed Business Combination. A list of the names of such directors and executive officers and information regarding their interests in the proposed Business Combination will be included in the proxy statement/prospectus for the proposed Business Combination when available. 3 Disclaimers
Today’s Agenda Introduction 5Key Investment Highlights 6Our Story & The Future of Pediatric Health 11Technology Review 14Value Proposition 21Market Overview 39Commercial Execution 44Financials 53 Contents 12345678 4
Today’s Presenters Kurt Workman Co-Founder & CEO 8+ years of experienceFormerly at Techstars and Clearlink Kate Scolnick CFO 25+ years of experienceFormerly at Anaplan and Seagate Lior Susan Founding Partner, Eclipse Ventures 12+ years of experienceOwlet Chairman of the BoardSerial Entrepreneur8 Years in IDF Special Forces 5
Key Investment Highlights 6
7 Owlet Today - By the Numbers ~$23BTotal Addressable Market $107M2021E Net Revenue $30CAC 71Net Promoter Score 47% 2019A – 2021E Revenue CAGR (1) 2021E includes projected sale of wellness version of the Owlet Band.
8 Our Vision for Tomorrow ~$81BTotal Addressable Market 2025 $1B2025E Net Revenue 78% 2021E – 2025E Revenue CAGR 56%2025E Gross Margin 6 yrCustomer relationship across expectant mothers & 2 children
____________________Sources: Pew Research Center--https://www.sciencedaily.com/releases/2016/09/160928160716.htmhttps://www.pewresearch.org/fact-tank/2019/09/09/us-generations-technology-use/ Company estimate based on Lux Insights Inc. consumer panelhttps://www.pewresearch.org/fact-tank/2019/09/09/us-generations-technology-use/ Google trendsFrost and Sullivan reports: Telehealth-- A technology-based weapon in the war against the Coronavirus 2020 Biometrics Used Everywhere Emerging Trends Make it the Right Time to Bring Technology To Parents Healthcare Moves Home Telehealth market potential of $122 billion(6)COVID-19 has led to massive shift in telehealthMost popular smartwatches propel the ‘consumerization of healthcare’ by adding clinical screenings like AFIB detectionPropelled by AI and Big Data, healthcare is moving from being reactive to proactive 92 million people will have pulse oximetry on their wrist by 2022(4)SPO2 is the hero feature in the 2020 Apple and Fitbit smartwatchesPulse Oximetry is in household conversationsCOVID-19 has led to a 20x increase in people searching “Pulse Oximeter” in the US(5) Parents are now more engaged than everFathers in 2012 spent 269% more time on average with their children than in the 1960s(1)Parents rely on technology more than ever(2) Early tech adopters are up to 3x more likely than slower tech adopters to own the Smart Sock(3) Parenting Gets Upgraded 9
Personal Electronics At-Home Fitness Digital Health Monitoring Parenting TAM: ~$81B(1) ____________________Source: Company disclosures.2025 company estimate based on product roadmap, 0-5 year old child population, future telehealth (note $6B of TAM is from telehealth and subject to FDA authorization) Owlet is the Next Connected Ecosystem Bringing Technology & Data To Modern Parenting Creating a Holistic Experience for Parents Apple Peloton LivongoiRhythm 10
Our Story &The Future of Pediatric Health 11
Our Mission: Empower parents to give care at home. At Owlet this means connecting parents with the training, tools and support they need to keep their baby safe, healthy and happy. Parenting Problems 12 92Million healthcare visits for children age 0-4 in the U.S. each year 44Lost nights of sleep on average in just the first year 27Thousand babies pass away unexpectedly between third trimester and month 6 at home
13 ConsumerCentric Digital Platform for Parenting Technologyenabled Healthcare*at home Strategic Investments:Full Stack TechnologyConnected Ecosystem Strategic Investments:Strong BrandFantastic User ExperienceConnected Nursery Strategic Investments:Medical Devices* ____________________*Requires authorization by FDA prior to commercialization
Technology Review 14
15 Owlet is is Democratizing Access to Advanced Technology for Parents in the Home Wellness Technology & data is locked in hospital Owlet plans to connect parents with data and experts
16 Owlet Sock* Current Technology Sock Technology Hospital pulse oximetry technology requires cords, tape and large machinery. Current Sock Data: Heart RateOxygen LevelSleep Trends Core body temperatureRespiration*Dehydration* Wearable Wireless Tailored for the nursery Future Sock Data: *May require FDA marketing authorization
17 Owlet Cam Most current cameras on the market are not smart or tailored for the nursery Current Cam: Night vision1080P VideoSound & Motion Notifications Respiratory rate*Inferred tempVisual AiBaby Height Future Cam Data: Sleep qualityAir quality IOT Enabled Grows with Baby 1080P + Night Vision *May require FDA authorization
18 Owlet Band* The Owlet Band Data: Current Technology Owlet Band Technology Collects Maternal Heart RateCollects Fetal Heart Rate*Sleep position Kick CountingContraction Tracking**Maternal Respiration** Only available with a practitioner, current non-stress tests require straps, wires and manual movement monitoring. Appropriate for home use Wireless Connected Wearable *First version is a wellness product; later versions and OTC Band could require FDA marketing authorization**Feature in R&D and may require FDA marketing authorization
Developing a Full Stack Technology Ecosystem to Address the Parenting Journey Hardware:Tracks OxygenHeart RateSleepTemperature* Conception Kindergarten AI & Data*:Baby is getting sick*Baby has health condition*Sleep regression Telehealth & Services:Telehealth Integration*Sleep CoachingEducational Courses One Mobile App* Solutions Portfolio full stack cohesive solutions throughout the parenting journey “ It looks like Ivy might be getting sick, we turned on the humidifier and extended her wake up time so Ivy can get better” “ER visits are pricey, we have pediatricians ready to look at Ivy’s Smart Sock data and chat any time tonight” Ivy is tracked accurately for 12.5 hours Ivy experienced a 5% drop in O2 along with a consistent HR increase. *The Smart Sock is not intended to screen or diagnose medical conditions. This information is to illustrate the future potential for Owlet’s products. 19
20 Owlet Turns its Data Into a Competitive Advantage with the Aim to Solve Real Customer Problems z ResearchOpportunistic ScreeningClosing the Loop at Home with Telehealth Automation Personalization Cost Reduction Improved AccuracyContinuous Technology ImprovementNew FeaturesAnticipating Customer Needs The Best Keeps Getting Better Always in the Know Personalized and Accessible Better Products Proactive Care Intelligent Integrations
V A L U E P R O P O S I T I O NWhy do we matter to parents? 21
Every Parent Has the Same Questions and Concerns SIDS: #1 cause of death in infants 1-12 months old(1)10x as many babies pass away from stillbirth as SIDS(2) ____________________Sources: Center for Disease Control https://www.ncemch.org/suid-sids/statistics/index.phphttps://www.cdc.gov/ncbddd/stillbirth/facts.htmlIn the US. https://www.ncbi.nlm.nih.gov/books/NBK526418/ (Table 2) https://www.aap.org/en-us/Documents/practicet_Profile_Pediatric_Visits.pdf (page 7)https://www.ncbi.nlm.nih.gov/books/NBK526418/ https://consumer.healthday.com/encyclopedia/parenting-31/parenting-health-news-525/sleep-deprivation-and-new-parents-643886.html (350 hours lost in the first year divided by 8 hours of night sleep = 44 nights of lost sleep)https://www.healthline.com/health/parenting/new-parent-sleep-study* Owlet Smart Sock is not intended for these purposes. These statements refer to concerns that parents have during parenting generally as background on the potential market opportunity as Owlet seeks to expand to health applications, and do not refer directly to any current product benefit or claim Is she breathing? 92 million well, sick, and ER visits in first 4 years of life(3)Respiratory issues--#1 reason for pediatric ER visits(4) When should I call my doctor? Parents lose 44 nights of sleep during the first year of a baby's life(5) Majority of new parents get 5-6 hours of sleep per night(6) Will we eversleep again? Sleep Safety* Sickness* 22
The Early Parenting Journey Meets Constant Change & New Challenges... Conception Kindergarten the biggest change that we go through in life 1 in 8 struggle with infertility(1)6M new pregnancies each year in the U.S.(4) Changes in health & bodyPreparing for labor ~4M babies born each year in the U.S.(2)33M healthcare visits(3) ~16M children 1-5yrs(2)Development key focus Becoming a parent is the biggest change we go through in life. We change everything from spending habits to schedule, and new parents with very little training become caregivers overnight. Taking over the roles of doctor, nurse, dietician and sleep trainer in a matter of months. ____________________Source: https://www.cdc.gov/nchs/fastats/infertility.htmhttps://www.cdc.gov/nchs/fastats/births.htm https://www.ncbi.nlm.nih.gov/books/NBK526418/ (Table 2) and https://www.aap.org/en-us/Documents/practicet_Profile_Pediatric_Visits.pdf (page 7)https://www.statista.com/topics/1850/pregnancy/Note: Figures pertain to the US 23
Fraught with a Fragmented Market & Disconnected User Experience Low-tech legacy companies and the lack of a category leader force parents to utilize dozens of disparate products to care for their baby. 24
‘Compelling Anchors’ are the Ecosystem Engines Owlet Smart Sock – A “Must-Have” Product for an Integrated Nursery Apple iPhone – A “Must-Have” Product for an Integrated Environment ____________________Source: Company provided materials and publicly available company filings2005 global mobile phone TAM calculated as 800mm units * average device sales price of $146. Sourced from IT Facts2019 global smartphone market sourced from EvercoreCompany estimate based on product roadmap, 0-5 infant population, U.S. demographic data is based on registered births in 2018 and includes pregnancies. EU demographic data is based on registered births in 2019 and includes pregnancies. Asia demographic data is based on registered births in 2019 in China, Japan, and South Korea and includes pregnancies. The number of pregnancies is calculated as an assumed 75% of annual births in that region. Includes projected sale of wellness version of the Owlet Band.Assumes the same demographics as today’s calculation for illustrative purposes. Includes future telehealth opportunity. (note a portion of TAM is from telehealth and subject to FDA authorization) iPad Accessories Services iPhone Cam Services Mac Accessories Smart Crib Smart Sock ~$120B(1) TAM: ~$460B(2) 2005 Global Mobile Phone TAM: 2019 Global Smart Phone TAM: ~$23B(3) ~$81B(4) 2021 Global Parenting TAM: 2025 Global Parenting TAM: TelehealthServices Platform 25
Owlet is the ‘Anchor’ Needed to Connect the Nursery ... Nightlight* Cam Smart Bed* Humidifier* Smart Sock Thermometer* Hey mom, looks like you could use some sleep! We noticed that didn’t sleep well. Let us help! Now that she’s 4 months old she can sleep through the night. Let Jen and Jill walk you through how. Software & Content ____________________Source: Company disclosures*In research and development 26
… All Under One Roof, Simpler & Smarter Together. Taking the Headache Out of Parenting Simplifying the purchasing journey for parents at retail and online. Under one roof means that parents can expect the products to work together in one app and with enhanced integrated features. 27
Improving LTV as Product Assortment Expands Current 2022 - 2023 Future $498 $1,596 $3,296+ Potential Lifetime Value Smart Socks(Sock+ 2021) Design this slide + + Owlet Cam(Cam 2 - 2022) Dream Lab(2020) Owlet Band*(2021) Smart Crib(2022-23) Connected Nursery(2022-25) Services(2022-25) Accessories & Consumables(2021-25) 28 *Could require FDA marketing authorization
29 2021 Forward Progress - Customer Usage & Satisfaction Net Promoter Score Amazon Star Rating Additional Hours of Sleep monitored Improved Sleep in Just 7 Days 71 102M 92% All products aggregate NPS score. Over 500 basis point improvement in Q1 of 2021 over Q4 of 2020 Aggregate Amazon reviews across all Owlet products In Q1 of 2021 Parents report with Owlet’s Dream Lab January - April 2021 4.4 #1Ranking in Top 3 Brand Metrics* Beta Testing Beta Testing Sock + Sock + beta testing started in Q1 and is finalizing in Q2 Band beta testing continued in Q1 with strong demand from parents Band *Based on consumer survey commissioned by third-party consultant in November 2020 (n=1,086)
30 2021 Forward Progress - New Product Development Launch planned for H2 Working Toward Commercialization Clear opportunity to leverage data Project Initiated Sock + Telehealth Crib Extends Smart Sock usage and relationship with family up to age 5 Anticipated strong demand from expectant mothers Ramping internal resources for go-to-market strategy Strategic work completed and internal resources starting Band $2K+Potential LTV Increase Beta Testing Beta Testing Sock + Sock + beta testing started in Q1 and is finalizing in Q2 Band beta testing continued in Q1 with strong demand from parents Band * *May require FDA marketing authorization
31 V A L U E P R O P O S I T I O NWhy do we matter to healthcare?
Healthcare Costs by Age 2009-10 Group Male ____________________Source: Company disclosures https://www.ncbi.nlm.nih.gov/books/NBK526418/ (Table 2)https://www.aap.org/en-us/Documents/practicet_Profile_Pediatric_Visits.pdf (page 7) More Healthcare Utilization During Early Childhood than Any Other Time of Life 92M Visits ER, sick, & well visits (ages 0-4)(1)(2) 3.4M ER Visits(1) 14M Sick Visits(2) 16M Well Visits(2) The First Year of Life: 32 Well Visit Sick Visit
33 ... And that Care is Costly Pediatric Office Visits$169/visit x 80M ER Visit $1.3K x 12M 1 Day in NICU $3.5k x ~307k ER Visit$15.6B Office Visits$13.5B 1 Day NICU ~$1.1B (1) https://www.aap.org/en-us/Documents/practicet_Profile_Pediatric_Visits.pdf (page 7; 2004-2007), https://consumerhealthratings.com/healthcare_category/doctors-charges-physician-prices-average-cost-anesthesia/ (2016) (2) https://hcup-us.ahrq.gov/reports/statbriefs/sb242-Pediatric-ED-Visits-2015.pdf, https://www.debt.org/medical/emergency-room-urgent-care-costs/, https://www.usatoday.com/story/news/health/2019/06/04/hospital-billing-code-changes-help-explain-176-surge-er-costs/1336321001/(3) https://journalofethics.ama-assn.org/article/cost-saving-tiniest-lives-nicus-versus-prevention/2008-10, https://jamanetwork.com/journals/jamapediatrics/fullarticle/2381545, https://pubmed.ncbi.nlm.nih.gov/25671704/, 2012 (1) (2) (3)
34 Peace of Mind Early Detection ... Signaling the Need for Better At-Home Triage 96.5%Treat & Release 3.5%Hospital Admission (1) Hospital Admission statistics: https://hcup-us.ahrq.gov/reports/statbriefs/sb242-Pediatric-ED-Visits-2015.pdf, ages 0-4(2) No current Owlet products are intended to screen or diagnose medical conditions (1) (1)(2)
____________________Source: Company disclosuresFrost and Sullivan reports: Telehealth-- A technology-based weapon in the war against the Coronavirus 2020https://www.ncbi.nlm.nih.gov/books/NBK526418/Company estimate based on Embrace.io app tracking softwareThird-party research report from 2020 accessing Owlet opportunity within telehealth ... Highlighting the Importance of Owlet’s Anticipated Telehealth Platform As access to doctors becomes more of a commodity within telehealth, *Although the Smart Sock is only intended for use in healthy babies to reduce parents’ stress and anxiety, Owlet is evaluating potential telehealth applications 79Minutes of Daily App Usage ⁽⁴⁾ 7.5x App Opened Per Day Avg ⁽⁴⁾ 61% of parents studied are interested in professional guidance through the Owlet App and 50% would pay $20+/month Engagement $122B Telehealth TAM in 2025(1) Illustrative example of future telehealth potential: we expect that owning the relationship with the customer & enabling with data will be the key differentiators #1 Reason for pediatric ER visits Respiratory Issues(3) 35 $6B Owlet Telehealth TAM in 2025(4)
Owlet’s Telehealth Solution is 24x7 care: content, community, and (professional) care offerings come together to create a proactive care experience ValueParents receive trusted content that is on-point and specific, rather than too abstract and difficult to consume.Original and compelling content will keep parents coming back to Care Assist. The frequency of use by parents will be a key indicator for subscription renewal. ValueThe Cohort Community establishes a network for each parent beyond the friend and family network they already have. The depth of connection to the Care Assist community will extend the life of the Care Assist subscription. ValueParents can bypass the many barriers to direct access to the care professionals they need.Easy access to healthcare professionals with hard-to-find expertise will be seen as the greatest value-add and has the potential to drive positive outcomes Cohort Community ValueParents can now stop worrying about what they need at every turn and if everything is okay and instead lean on Proactive Care to guide them to what they need to do, supporting them in their parenting needs. As more customers use Owlet, it allows Owlet to become a smarter parenting AI that can take away the work of knowing what to do and when - giving everyone an opportunity to become a parenting expert and freeing up time for the higher order bits of nurturing their families and finding joy in everyday things. AI Driven Insights & Content Care Professionals (Telehealth) Proactive Care AI curates and delivers insights and content that parents need based on data from Owlet devices and parent interest. Connect parents to a cohort community of other parents where they can seek help without any worry of being judged and can share their experiences to help others. Empower parents to get personalized care through care professionals, 24x7 and via multiple channels (video, phone, text) Parents can proactively get care instead of having to track what they need and what they need to do at any given time during the parenting journey. Proactive care uses Machine Learning and AI to use parents’ data and usage to recommend as well as facilitate care options. OfferingIn-house and partner expert articlesTimely insights & notificationsVideo tutorialsSoftware & data enabled interactive parenting classes OfferingPhase and topic based cohortsSocial events – virtual and / or localModerator led chats w/ parentsReward (good karma) points for providing supportSecond-hand marketplace OfferingAccess to professional care 24x7Access at the press of a button (low friction) - easy to find and easy to scheduleProfessional care using data available from their Owlet productsOne-on-one consultations and follow-upsNo insurance or referrals required OfferingProactively understand needsRecommends course(s) of actionFacilitates preferred course of action Owlet Device Data Which Will Give Parents 24x7 Care with Content, Community and Professionals
37 BabySat Building credibility and opening up a new market OTC Sock Expanded claims could lead to deeper penetration OTC Band Designed to make pregnancy care easier Owlet is Investing in the Development of Medical Devices to Address This Large Home Care Opportunity* ____________________Third party research report* BabySat, OTC Band and OTC Sock are investigational medical devices, which would require authorization by FDA prior to commercialization First pulse oximeter designed for babies Designed to utilize telehealth platformDesigned for babies with health conditions Designed to utilize telehealth platformDesigned for healthy babiesDesigned to opportunistically screen for health conditions Non Stress Tests & pregnancy checkups from homeDesigned to opportunistically screen for fetal and maternal health conditions 3 2 1
38 2021 Forward Progress - Clinical + Regulatory Published/Ongoing Studies Care Service Medical Devices in Development Europe 12 Telehealth 3 CE Medical New study by Cleveland Clinic researchers analyzed over 200M hours of biometric data from Owlet Project initiated and R&D underway BabySat, OTC Sock & OTC Band Ongoing implementation of ISO 13485 and preparation to file for CE Medical Massive & Growing Data Set on Infant Health
Market Overview 39
Leading to a Large & Growing TAM for Owlet’s Products ____________________Source: Company provided materials, Centers for Disease Control and Prevention (CDCP) and StatistiaCompany estimate based on product roadmap, 0-5 infant population, U.S. demographic data is based on registered births in 2018 and includes pregnancies. EU demographic data is based on registered births in 2019 and includes pregnancies. Asia demographic data is based on registered births in 2019 in China, Japan, and South Korea and includes pregnancies. The number of pregnancies is calculated as an assumed 75% of annual births in that region. Includes projected sale of wellness version of Owlet Band.Assumes the same demographics as today’s calculation for illustrative purposesIncludes future telehealth opportunity. (note a portion of TAM is from telehealth and subject to FDA authorization) 2021 Parenting TAM ~$23B(1) 2023 Parenting TAM ~$49B(1)(2) 2025 Parenting TAM ~$81B(1)(2)(3) $81B $49B $23B 40 TAM Growing at 37% CAGR through 2025
TAM Detail ____________________Source: Company provided materials, Centers for Disease Control and Prevention (CDCP) and Statistia. Utilizes company provided LTV data. U.S. demographic data is based on registered births in 2018 and includes pregnancies. EU demographic data is based on registered births in 2019 and includes pregnancies. Asia demographic data is based on registered births in 2019 in China, Japan, and South Korea and includes pregnancies. The number of pregnancies is calculated as an assumed 75% of annual births in that region.Assumes the same demographics as today’s calculation for illustrative purposes.First version of Owlet Band is a wellness product, launching in 2021. Subsequent versions, including OTC Band, may require FDA marketing authorization. Asia:~$3.8B European Union: ~$6.6B United States: ~$12.9B LTV Opportunity Children 0 - 5 years oldIncome filter $846~21.8M70% LTV Opportunity Children 0 - 5 years oldIncome filter $846~28M28% LTV Opportunity Children 0 - 5 years oldIncome filter $846~90.9M10% 2021 Parenting Market TAM ~$23B(1) LTV Summary Total Future LTV Opportunity: $2,633 LTV Opportunity Children 0 - 5 years oldIncome filter $2,633~21.8M70% LTV Opportunity Children 0 - 5 years oldIncome filter $2,633~28M40% LTV Opportunity Children 0 - 5 years oldIncome filter $2,633~90.9M5% 2025 Market TAM ~$81B(1)(2) European Union: ~$29.5B Asia:~$11.9B + United States: ~$40.2B Owlet targets a parenting TAM of ~$81bn through its current product pipeline(1)(2) 41 Existing LTV Opportunity Increase to LTV Opportunity Product Price Product Price Sock $299 Telehealth $20/mo Band(3) $299 Smart Crib $999 Cam $149 Accessories +consumables $50 Dream Lab $99 Total Existing LTV Opportunity $846 Increase to LTV Opportunity $1769
42 Consumer Competition: $300B+ Annual Spend by Parents in the U.S. Alone Across Consumer, Healthcare and Technology Technology Healthcare HonestPampersFisher PricePhillipsJohnson & Johnson Amwell Teladoc Doctor on Demand Blueberry Health MasimoNanitNuvoGE
AI driven algorithms to reduce inaccuracies and improve user experience. Smart Sock nuisance alarm rate <1/50 (2) what it would be without innovations. Also discovered data patterns that could enable opportunistic screenings of critical health conditions--if successfully developed and authorized for such use. Proprietary circuit boards that are small and low power while still maintaining extremely low noise that enable high quality measurements and better accuracy. Also our patents enable superior placement of sensors in the best location for infants--the foot. Owlet was the number one brand for repurchase intent when compared to 13 competitive brands. Also Owlet is ranked first, second or third in 11 of 15 brand loyalty drivers. (1) ____________________Source: Third party market analysis from 2020. Comparing brand metrics across 9 competitors in the baby industry. “top 3 brand metrics” were: best technology, gives parental confidence, most popular brandPotential features proposed in the survey included carbon monoxide alarm (77%), wearable smart thermometer (69%) and baby scale (61%)Company estimate based on Smart Sock data analysisAs of March 31, 2021 Driving Key Competitive Moats Better ProductsClinical Insights* 1.5MParents Used the App(3) 9BHeartbeats Monitored Per Night(3)(estimated) More Products Purchased More Data The Data Flywheel Proprietary Data Advantage Fabrics Electrical Firmware Algorithms Mobile Backend Innovations Across Entire Tech Stack 38Trademark Registrations 33IssuedPatents 9-Year Technology Headstart Ranking in the top 3 brand metrics Connected Ecosystem #1Ranking in the top 3 brand metrics(1) 61-77%Customers would consider other baby products from Owlet(1)(2) One Cohesive Experience 43 (4) (4)
Commercial Execution 44
4 Key Opportunities For Growth* Penetrationwith Existing Products Connected NurseryExpanding The Ecosystem Telehealth& Medical Devices InternationalExpansion Beyond The USA 2. 3. 4. Already achieved 20%+ penetration in several states in 2021. Similar penetration into more U.S. states will drive key revenue growth into 2025. Several key anchors in our Connected Nursery roadmap will launch in next 12 months, with strong interest from parents and existing customers Anticipated demand for telehealth and medical devices from Owlet, matching industry-wide growth 2025 int’l revenue is very achievable, based on current percent of revenue in 2021, coupled with expansion plans for next 4 years 45 Telehealth and Medical Devices Expand International Connect The Nursery Deepen Penetration ____________________*Company estimates Gross Revenues
46 Compared breakdown by subregion - Google Trends Penetration Opportunity baby monitor Owlet Interest for Owlet WyomingUtahNebraskaArkansasIowa (1) Google Trends, June 2021 Owlet has high penetration in its home state (UT) and states with active foundationsParents are 7x more likely to buy an Owlet if they know someone who already owns an OwletBecause parenting is generational, and tightly networked, a tipping point occurs as more parents own Smart Socks Owlet currently reaches 1 in 5 children in a few states. Similar penetration across the U.S. would equate to $1B+ of revenue in 2025 Mauve color indicates search volume for ‘Owlet’ is greater than ‘baby monitor’ (1) (2) Company survey of 1,399 parents, July 2019 (2)
47 2. The Cyclical Parenting Journey Creates a Large LTV Opportunity Yr 1 6 Years(2 Children) Anchors drive daily usage. Owlet data & app usagecreates a massive telehealth opportunity Owlet Care $20/mo(x 72 months = $1440 LTV) $299* $299 $799 $149 Design help needed Yr 3 *First version of Owlet Band is a wellness product at $299. Subsequent versions including the OTC Band may require FDA marketing authorization.
48 3. Reimbursement and Contribution: Owlet’s Goals Employers, Payers and Providers would all benefit from better in home pediatric care z Safety Sickness - earlier careSleep Primary Care VisitsER VisitsExtra NICU Stays Better SleepCheck on Baby RemotelyMore confidence & less anxietyCoveted employer benefit Employers want competitive, value add benefits Providers want to better manage risk Employers and Payers want to reduce costs Back to Work Experience Health Outcomes Cost Reduction
4. International Expansion to Europe, Asia & LATAM by 2025(1) LATAM 202460MChildren USA 2015 25M Children Europe 202130M Children Asia 202297MChildren ____________________Source: Company estimates based on population data provided by U.S. Census Bureau, United Nations, and OECDhttps://daxueconsulting.com/baby-care-market-in-china/ 47% of Chinese consumers prefer imported brands for safety reasons(2)22% ’15-’19 CAGR on the baby care market in China(2)Online channels represent 50% of mother and baby retail market value in China(2) 49
50 2021 Forward Progress - Penetration Impressions in Q1 2021 Y/Y Growth on Amazon Website Visitors in Q1 2021 New Retail Doors Committed 353M 51% 3M 308 Across paid advertising. This represents 101% Y/Y growth. Q1 of 2021 compared to Q1 of 2020 Visitors to the Owletcare.com website. Over 475K blog views. In Q1 of 2021. Dillards and Walmart are expanding their stores for Owlet. #1Ranking in Top 3 Brand Metrics* *Based on consumer survey commissioned by third-party consultant in November 2021 (n=1,086)
51 2021 Forward Progress - LTV Expansion Owlet Users Own a Cam Customers Willing to Purchase Additional More Dream Lab Purchases New Products In Development 53.8% 61-77% 4X 4 Cam has only been in the market for two years, highlighting the LTV expansion opportunities Owlet baby products Over Q1 2020 Leading to over $2K in potential LTV increase #1Ranking in Top 3 Brand Metrics* * (1) *Based on consumer survey commissioned by third-party consultant in November 2020 (n=1,086)(1) Potential features proposed in the survey included carbon monoxide alarm (77%), wearable smart thermometer (69%) and baby scale (61%)
52 2021 Forward Progress - International Growth in Canada Q1 2021 vs Q1 2020 Growth in UK Q1 2021 vs Q1 2020 Growth in Australia Q1 2021 vs Q1 2020 Q1 2021 Launch 132% 546% 68% Nordics Doors increased with the launch of London Drugs Increased distribution to Boots and Curry’s online. Increased awareness top of funnel Expanded online presence and ecommerce partnerships First launch outside of English-speaking countries 3Continents
Financials 53
Drivers of Profitability and Long-Term Model 2019A 2023E 2020A 2 YoY Growth - 51.4% 83.1% 3 Gross Margin 46.0% 47.6% 56.3% 1 Net Revenue(1) $49.8M $75.4M 5 TAM Penetration(1)(2) 0.06% 0.09% 1.31% 4 EBITDA Margin (33.4%) (10.9%) 15.8% _______________________________Assumes FDA clearances of ‘OTC Sock’ in Q4 of 2022Net revenues divided by $81B potential TAM (note a portion of $81B TAM is from telehealth and pending FDA authorization) 2021E 42.2% 53.7% $107.2M 0.13% (24.5%) 2022E 62.9% 54.7% $174.7M 0.22% (15.2%) 2024E 2025E $316.4M $581.4M $1,064.5M 81.1% 55.4% 0.39% (4.1%) 83.8% 56.3% 0.72% 9.5% 54 *today’s focus
55 2021 Forward Progress - Q1 Financial Results Revenue Gross Margin Key Executive Hires and BOD Appointments 57.9% 47% 6 1100 bps improvement Y/YDriven by new products and COGs improvements Y/Y Revenue GrowthExceeding internal targets by ~10% $21.9M Demonstrating FinancialPerformance
56 Significant Revenue Growth and Margin Opportunities Focused Near-Term Investments to Build Platform Scale Strong Balance Sheet to Support Investment Attractive Financial Characteristics to Drive Growth
Summary 57
Attractive Business Model Strong Long-Term Revenue Growth High and Improving Gross Margins Visible and Robust Pipelineof Existing and New Products Extensive Distribution Platform 66.6%2019A – 2025E Net Revenues CAGR 46.0%2019A Net Revenues Gross Margin 56.3%2025E Net Revenues Gross Margin 75.9%2023E Gross RevenuesFrom Existing Products 65.2%2025E Gross RevenuesFrom Existing Products ____________________Source: Net revenues divided by $81B TAM Based on Company data 65%Sales by online channels in 2019A Large Market with Room To Grow 1.31%2025E TAM Penetration(1) 0.06%2019A TAM Penetration Powerful Competitive Moats: Data, Brand, & Tech 4THeartbeats monitored since inception(2) <1/50SS false alarm rate vs. without accelerometry & AI innovations(2) 58
Questions? 59