February 12, 2019
Benjamin Silbermann
Chief Executive Officer
Pinterest, Inc.
505 Brannan Street
San Francisco, CA 94107
Re: Pinterest, Inc.
Draft Registration Statement on Form S-1
Submitted January 7, 2019
CIK: 0001506293
Dear Mr. Silbermann:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so we may
better
understand your disclosure.
Please respond to this letter by providing the requested information and
either submitting
an amended draft registration statement or publicly filing your registration
statement on
EDGAR. If you do not believe our comments apply to your facts and circumstances
or do not
believe an amendment is appropriate, please tell us why in your response.
After reviewing the information you provide in response to these comments
and your
amended draft registration statement or filed registration statement, we may
have additional
comments.
Draft Registration Statement on Form S-1 Submitted January 7, 2019
Summary
Risk Factors Summary, page 5
1. Please disclose in the prospectus summary that your directors, executive
officers and
principal stockholders will continue to have substantial control over
the company after the
offering. Disclose the percentage of the voting power to be held by
affiliates following
the offering.
Benjamin Silbermann
FirstName LastNameBenjamin Silbermann
Pinterest, Inc.
Comapany NamePinterest, Inc.
February 12, 2019
February 12, 2019 Page 2
Page 2
FirstName LastName
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Overview / History, page 56
2. Please revise your overview section to provide insight into the
material challenges, risks
and opportunities focused on by your management. For example, we note
that you
"currently only monetize in certain countries and currencies." Discuss
your significant
challenges in monetizing your user base in other countries compared to
the United
States. Please also discuss any material trends or uncertainties in
your effort to increase
the number of users in certain demographic populations such as men as
you state you
intend to do on page 13. Finally, we note that 85% of your searches
occur on mobile
devices. Explain how the differences in mobile devices compared to
desktop impact your
approach to advertising. See Item 303(a) of Regulation S-K and SEC
Release No. 33-
8350.
Key Metrics, page 57
3. You state in the risk factors section on page 28 that you regularly
review metrics to
"evaluate growth trends and the depth and quality of engagement of
Pinners" in addition
to the number of active users. Please disclose the key metrics that
management uses to
manage the business for each period presented. You state that in the
past, you relied on
metrics such as "saving a Pin" and "clicking and other activities." As
part of your
response, clarify whether you still measure these activities. Refer to
Section III.B of SEC
Release No. 33-8350.
Trends in User Metrics, page 57
4. Please disclose the proportion of your weekly average users (WAU) to
monthly average
users (MAU) for all periods presented.
Trends in Monetization Metrics, page 59
5. Your rate of monetization outside of the United States is consistently
and significantly less
than the monetization rate within the United States, as noted from
your tabular
presentations of "Quarterly Average Revenue per User" for the United
States and
International on page 60. Please provide quantitative context
regarding the nature of and
reasons for the monetization disparity. For example, address how the
disparity of
International ARPU may be driven by volume of advertisers, reduced ad
pricing in
comparison to the United States, or other quantitative factors.
Disclose the extent these or
other factors indicate any material trends impacting your future
results or financial
position.
Benjamin Silbermann
FirstName LastNameBenjamin Silbermann
Pinterest, Inc.
Comapany NamePinterest, Inc.
February 12, 2019
February 12, 2019 Page 3
Page 3
FirstName LastName
Results of Operations, page 63
6. Please ensure that you provide an indication of the magnitude of each
of the factors you
identify that caused material changes in revenue. Address the
following:
Clarify how the increase in average MAUs, which you attribute
primarily to
international user growth that monetizes at a relatively low rate,
contributed to the
increase in revenue. Revise to include the change in international
revenues in order to
provide context to this statement; and
Revise to quantify the increase in the number of advertisements
delivered, as well as
the increase in the number of advertisers and the increase in
demand from existing
advertisers that each contributed to such increase. In this
regard, we note that the
number of ad impressions and the number of advertisers are among
the variables
that impact your growth in monetization affecting your
performance, based on your
discussion on page 61.
Refer to Item 303(a)(3) and Instruction 4 to Item 303(a) of Regulation
S-K and Section
III.D of SEC Release No. 33-6835.
Liquidity and Capital Resources, page 70
7. Your discussion and analysis of liquidity and capital resources should
address known or
reasonably likely short-term and long-term cash requirements. Please
revise to address
the existence and timing of your anticipated cash requirement to
satisfy the payroll tax
remittance obligations associated with the vesting of RSUs and
exercise of stock options,
as noted from your disclosure in the middle of page 38. Refer to
Section IV.A of SEC
Release No. 33-8350.
General
8. You cite to two studies by Comscore of which one was commissioned by
the
company. With each reference to a study by Comscore, please revise to
state whether the
information is based on the commissioned study or the independent
study. In addition,
clarify your statement that the "reports were based on surveys of
monthly users" and
weekly users to indicate whether the definition of monthly user and
weekly user is the
same as monthly active user and weekly active user. Finally, file a
consent for each
commissioned study pursuant to Rule 436 of the Securities Act.
9. Please provide supplemental support for your statement that you "reach
41% of internet
users" in the United States. We note that you had 80 million monthly
active users in the
United States as of September 30, 2018 which is approximately 25% of
the total
population of the United States.
Benjamin Silbermann
Pinterest, Inc.
February 12, 2019
Page 4
10. Please supplementally provide us with copies of all written
communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to do
so on your behalf,
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether or
not they retain copies of the communications.
11. Please supplementally provide us with copies of any graphical materials
or artwork you
intend to use in your prospectus. Upon review of such materials, we may
have further
comments. For guidance, refer to Question 101.02 of our Securities Act
Forms
Compliance and Disclosure Interpretations.
You may contact Melissa Walsh, Staff Accountant, at (202) 551-3224 or
Stephen
Krikorian, Accounting Branch Chief, at (202) 551-3488 if you have questions
regarding
comments on the financial statements and related matters. Please contact Jeff
Kauten, Staff
Attorney, at (202) 551-3447 or Jan Woo, Legal Branch Chief, at (202) 551-3453
with any other
questions.
Sincerely,
FirstName LastNameBenjamin Silbermann Division of
Corporation Finance
Office of
Information Technologies
Comapany NamePinterest, Inc.
and Services
February 12, 2019 Page 4
cc: Pamela L. Marcogliese, Esq.
FirstName LastName