Good morning, and welcome to the Vivid Seats' Third Quarter 2021 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to Ashley DeSimone. .

Good morning, everyone, and welcome to Vivid Seats' Third Quarter 2021 Earnings Conference Call. I'm Ashley DeSimone, Managing Director, ICR. Joining me today to discuss Vivid Seats' results are Stan Chia, Chief Executive Officer; and Larry Fey, Chief Financial Officer.

By now, everyone should have access to the company's third quarter earnings press release filed earlier this morning. We have also provided supplemental earnings slides. The press release and earnings slides are available on the Investor Relations page of Vivid Seats' website at www.investors.vividseats.com. .

During the course of this call, management may make forward-looking statements within the meaning of the federal securities laws.

These forward-looking statements include statements related to Vivid Seats' anticipated financial performance and operating results, market opportunity, the future impact of COVID-19 on their operations and their business strategy and plans.

These statements are neither promises nor guarantees and are based on management's current expectations and beliefs and involve risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements.

Please refer to today's press release and the company's filings with the SEC, including the Risk Factors section in the company's quarterly report on Form 10-Q for the quarter ended September 30, 2021, filed with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today.

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On today's call, we will refer to adjusted EBITDA, a non-GAAP financial measure, as we discuss the third quarter's 2021 financial results.

You will find a historical reconciliation of adjusted EBITDA to actual GAAP results included in the press release issued earlier today and available on the company's Investor Relations page at www.investors.vividseats.com. .

And now, I would like to turn the call over to Stan.

Stan?.

Good morning, everyone, and thank you for joining us today on our first earnings call as a public company. I'm Stan Chia, Chief Executive Officer of Vivid Seats, which I've had the privilege of leading since November of 2018. As you know, we began trading on the NASDAQ several weeks ago.

We are excited and humbled to have this amazing opportunity and look forward to this new chapter. .

I would like to thank our existing investors who enrolled all of their equity as part of the business combination, our new partner, Todd Boehly, who has already provided meaningful financial and strategic benefit to the business; and our new public shareholders as we embark on this journey.

Most importantly, I want to thank our teammates at Vivid Seats for their relentless dedication and commitment through such a challenging environment last year and also for their fanaticism in creating exceptional experiences for all of our customers.

These efforts not only culminated in us becoming a public company but also resulted in record-setting financial results in our third quarter. .

Our third quarter performance reflected our highest single quarter results across all of our key financial metrics as the team delivered $713 million in marketplace gross order volume or GOV, $140 million in revenues and $42 million in adjusted EBITDA. .

Given this is our first earnings call as a public company, I would spend a few minutes providing some background on who we are, our mission and what we believe makes us different. Vivid Seats is a leading online ticket marketplace committed to being the ultimate partner for connecting fans to the live events, artists and the teams they love.

We provide leading technology platforms and services that connect fans of live events and ticket sellers with the simple mission of enabling fans to experience it live. .

Attending live events creates lifetime memories, and we believe our marketplace delivers a seamless and trusted experience to help fans safely buy tickets to the events they want.

We differentiate ourselves by offering tickets across a wide range of events with competitive pricing supplemented by a dynamic and unique loyalty program, Vivid Seats Rewards. We endeavor to provide our fans with exceptional value, so they can attend more of their favorite events and make lifetime memories while doing so.

Our ecosystem connects millions of buyers with thousands of sellers, resulting in over 17 million annual ticket purchases across 200,000 events. .

During the height of the COVID-19 pandemic, we were able to set the minds of Vivid Seats' customers at ease and assure them of cash refund options or loyalty awards credit, which we paired with a donation to charity.

We are proud that we were able to offer our buyers who wanted or needed cash, that option, but we also offered the alternative of enhanced future buying power by way of offering rewards cash loyalty credit for 110% of the full value of the order total.

We want our fans to know that Vivid Seats is a safe and secure place to buy tickets backed by our 100% buyer guarantee, designed to give them peace of mind. .

Because we are a 2-sided marketplace, we also strive to enable our sellers to manage their inventory and complete transactions seamlessly. We offer SkyBox, one of the most widely adopted seller ERPs in the industry to sellers free of charge. We continually upgrade this platform to support evolving seller needs. .

As I noted earlier, we had a record-setting quarter. We generated $713 million of marketplace GOV, $140 million of revenues and $42 million of adjusted EBITDA. Larry will provide more details later, but this performance builds on the positive momentum demonstrated last quarter and reflects the desire of fans to return to their favorite events. .

While the emergence of the Delta variant in August of this year raised caution, venue operators responded by instituting admittance protocols that focused on requiring proof of vaccination and/or a negative COVID test to ensure live events remained safe.

As a result of these efforts, as they say, the show went on with many fewer cancellations or postponements than we saw in 2020. .

Beyond our financial performance, I am very excited about the enhancements we made across our user experience and loyalty program. Our product and technology teams were hard at work last year, focused on innovating across our consumer platform, and we brought many of those efforts to life in the third quarter.

As a proudly Chicago-headquartered company, we timed the product release schedule to coincide with the return of Lollapalooza, an iconic Chicago weekend music festival held in late July.

Our new product suite encompassed redesigned web and app experiences, all carefully designed to enhance the user experience with search, discovery and personalization as well as under-the-hood performance and system enhancements. And best of all, all of these customer-facing elements were styled with the visual identity of our new brand. .

At the same time, we enhanced our already unique loyalty program, Vivid Seats Rewards. Vivid Seats Rewards now allows every fan to earn 10% in value on every ticket purchased. And when combined with our competitive pricing, is one of the strongest economic propositions out there. We didn't stop there though.

We've continued to add value for our fans by adding perks that augment the actual event experience.

At launch, we announced a unique perk with DraftKings that rewards our users with free DraftKings dollars as they attain new loyalty tiers as well as our Surprise and Delight program, where our users will occasionally receive surprise upgrades to better seats or access to unique events. .

At our first event, Vivid Seats Rewards' members received exclusive access to TAO in Chicago for an intimate Lollapalooza after-party, jointly hosted by our partners at Rolling Stone Magazine and featuring an intimate performance by Roddy Ricch. .

We've also continued to forge partnerships that will continue building exceptional experiences for our customers. We've announced our partnership with Klarna, adding the ability to give even more of our customers the convenience they need to experience it live. .

Finally, we continue to seek ways to support our community through a number of programs like our continued partnership with Musicares. In the third quarter, we supported those in our industry impacted by Hurricane Ida and have now donated millions of dollars since the start of the COVID-19 pandemic. .

With that, I will turn it over to Larry to review our financials.

Larry?.

Thank you, Stan. I am delighted to have our first earnings call aligned with the reporting of record results. As Stan mentioned, we set company records for quarterly marketplace GOV, revenues and adjusted EBITDA in the third quarter. Our marketplace GOV of $713 million was fueled by the continued return of live events.

Of note, the third quarter saw a meaningful increase in the number of marketplace orders, up 37% sequentially relative to Q2 of this year. At the same time, we saw a normalization of average order size or AOS, which we define as marketplace GOV divided by marketplace orders, which was closer to $300 in Q3 versus roughly $400 in Q2.

This lower AOS is the result of a combination of normal seasonal event mix and some demand headwinds that we believe result at least in part from concerns related to the Delta variant that emerged in August and September. .

Our revenues of $140 million were primarily driven by our strong marketplace GOV performance. I would note that our take rate, which we calculate by dividing our marketplace revenues by our marketplace GOV, increased by nearly 200 basis points from approximately 15% in Q2 to approximately 17% in Q3.

This increase is primarily related to elevated COVID-related cancellation activity that occurred in Q2. Underlying take rates remain largely consistent with historical levels in our previously provided long-term forecast. .

We generated a net loss of $2 million in the third quarter, along with adjusted EBITDA of $42 million, which represents a 30% adjusted EBITDA margin. This adjusted EBITDA margin is reflective of strong marketplace GOV alongside the continued rebuilding of our teams from COVID levels to support the rapid return of volume. .

On top of rebuilding our teams across functions, we're also adding in new public company costs, which will impact adjusted EBITDA margins in the near term.

While our strong margins in Q2 and Q3 support our belief in a long-term margin profile above 30%, in the near term, we anticipate our margins will be reduced as we ramp headcount and initiate broader marketing efforts. .

We continue to generate positive cash flow in Q3 with our cash balance increasing by $27 million during the quarter to $488 million from $461 million as of the end of Q2. With this continued cash generation, we will have a net cash position pro forma for the business combination.

Working capital has been a meaningful contributor to our cash flow thus far in 2021 as the return of volume has quickly rebuilt our cash flow. As a reminder, working capital is a consistent positive contributor to cash flow as we grow because we received payments from our customers before remitting corresponding payments to our ticket sellers. .

We have seen customers redeeming store credit created during the pandemic at a consistent pace and expect that will continue in coming quarters. These redemptions result in noncash revenue and EBITDA, and thus, we anticipate some working capital headwinds relative to the exceptional performance we have seen thus far in 2021. .

We provided full year 2021 guidance in late October. This full year guidance called for marketplace GOV of $2.225 billion to $2.325 billion, revenues of $420 million to $435 million and adjusted EBITDA of $102 million to $107 million.

With our performance through Q3, this full year guidance implies Q4 marketplace GOV of $700 million to $800 million, revenues of $140 million to $155 million and adjusted EBITDA of $20 million to $25 million.

These marketplace GOV and revenue ranges are consistent with the fourth quarter being our seasonally strongest quarter and assumes the live event calendar remains consistent with expectations as announced by major promoters such as Live Nation but with some level of cancellation-related impact as we continue to face uncertainty around COVID. .

In Q4, we anticipate a lower adjusted EBITDA margin than we saw in Q2 and Q3 to reflect the beginning of our brand and broader marketing investments.

We had originally planned for meaningful brand investments to begin in 2022, but with the return of live events happening more quickly than originally anticipated, we have pulled forward our brand launch into Q4 of 2021. .

With that, I will hand it back to Stan for closing remarks. .

Thanks, Larry. To recap, we are thrilled to start our journey as a public company with record-setting results across marketplace GOV, revenues and adjusted EBITDA.

Our positive momentum, coupled with our robust balance sheet, position us well to press our advantage as we launch our brand building and broader marketing efforts and continue to improve our offering for our fans and sellers.

We are excited about the opportunity ahead as we tell our story with our enhanced product and loyalty program in a period where we anticipate record demand to attend live events coming out of the pandemic. .

And with that, operator, I will open it up for questions. .

[Operator Instructions] Our first question coming from the line of Shweta Khajuria with Evercore ISI. .

Two questions, please.

Any particular regions that you want to call out where you were surprised to see outsized demand trends because those regions were more open than the others? And second is, any -- of the 3 key verticals you have, any particular one, was it sports, live sports coming back with an audience that was stronger than you thought or concerts or theater? Any comments around that would be great.

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Yes. In terms of the regions, starting at the country level, I'd say that Canada has lagged, the U.S. a bit in terms of their reopening cadence, so seeing a slightly slower recovery there so U.S. outpacing a bit.

Within the U.S., the South I think has led it, Texas and Florida being the largest 2 states that I think were a bit ahead of others in terms of pace of reopening. But broadly speaking, I'd say that the U.S. seems to be well positioned as we enter 2022, with pretty much all regions having figured out their protocols and regulations to enable events.

And you can see that across the sports landscape in particular right now where across the country, you're seeing stadiums filled with capacity. .

Yes. And Shweta, one other thing I'd add, one of the other things we track, which I think is a fairly bullish indicator is how much consumers are willing to travel. And as we've looked at the quarter, as we compare it to 2019, on average, consumers are now traveling almost 20% more than they used to for events.

So I think largely across the categories, we see some strong signs of optimism and really that return in excitement around live events coming back. .

And then I'd take your second question going into the event categories, certainly, sports came back the quickest. And I think theater came back the slowest with Broadway not reopening until September.

But against that backdrop, I'd say our -- as you'll see in the Q, our ratios across these end categories were pretty consistent with our historical levels.

So I think we feel good about what that portends for next year as it relates to concert and theater opportunity when you have a full event calendar, but within the numbers realized to date, it's pretty consistent with past few years. .

Our next question coming from the line of Jason Bazinet with Citigroup. .

So I guess a little basic question, you guys have obviously had a much better year this year than I think you thought a little while back.

Without getting into specifics, how would you say it influences your long-term view? In other words, is this just a more rapid sort of climb out of the COVID depths and shouldn't be read as sort of broadly better for your business? Or do you think it's more a sign that your long-term forecast might be conservative?.

Yes, Jason, this is Stan. Thanks for the question. I think maybe helpful always to reground when you think about where we were when we projected. When we made those projections early, we were still in a world where, I'd say, vaccines were on the premise of being approved and live events really hadn't opened up yet.

So I think there was certainly some conservatism in our original projections.

As we look out, I think what I'd say is there is a once-in-a-lifetime opportunity now as we look at people coming back and a surge of pent-up demand, I think there's still uncertainty in terms of how long is that going to last? Is that going to last through '23 and beyond? Or is that going to end in '22?.

I think what we focus on, though, is certainly our ability to build what we feel is a best-in-class product.

And as we look at the investments we've made that we've highlighted on this call, launching a new brand, launching a unique and innovative leading loyalty program, combined with our competitive prices, I think what you'll see us continue to do is invest in value for the consumer.

And in line with that, be aggressive on the marketing front to make sure that as there is this opportunity to tap into high consumer demand that we are there to meet the needs of customers. .

Our next question coming from the line of Benjamin Black with Deutsche Bank. .

I have sort of 2 on marketing. So can you touch on the current marketing environment? And we've heard from others that customer acquisitions, particularly on digital platforms, is increasingly challenging.

And then the second one, so with the shift to mobile, I'd be curious to hear if IDFA has impacted your marketing spend at all?.

Yes. Benjamin, thank you for the question. I think the first thing, as we look at the landscape, in particular, around digital marketing, that's been one of the areas of historical strength for us. We've got our own proprietary platforms that allow us to be aggressive but disciplined on the digital marketing front using our own first-party data.

That has always historically and currently persists where, on that front, we are still first-transaction profitable. So we have a lot of room to continue to be aggressive versus competitors who might not have that proprietary platform. .

With respect to how we think about customer acquisition cost in the long term, I think we're certainly looking to blend that out as we invest in brand marketing, where I think as you look at the impacts of a profitable digital marketing platform with sub-10% awareness. And I think there's only room for improvement across those fronts.

I'll punch it over to Larry a little who can give you some framework for how to think through that as well. .

Yes. I think specific to the question on trajectory of marketing spend and efficiency. We have not experienced what you touched on where costs have moved meaningfully outside the bounds of historical norms in the channels that we're in today. .

As Stan alluded to, we are actively diversifying and expanding the channels that we're in.

And I think you saw in our prior projections that we expect to increase our marketing spend in '22 by about $40 million relative to our 2019 levels, which I think is directionally indicative of a diversifying approach to get that brand awareness built and make customers aware as they do reengage with live events that we have a different proposition than some of the other alternatives out there.

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Our next question coming from the line of Maria Ripps with Canaccord. .

Congrats on the strong quarter here. So just a follow-up on the supply side. It seems like there is a lot of interest on the artist side to resume tourings. Sports was strong. Can you maybe just talk about sort of the sustainability of these trends as we move into next year and beyond? And then I have a quick follow-up. .

Maria, thanks for the question. Yes, I think, look, we continue to see, I think, 2 sides. On the consumer side, we see all of the demand that we feel is strong and pent up in that release. On the supply side, I think what we've seen is a really encouraging sign of artists really looking to get out on tour.

I think if you look at Live Nation's most recent earnings, they've talked about the number of artists that are out there and how many tickets they're selling already into '22.

Certainly, as a secondary market, all of the benefits that you can see there, I think you report would be applicable to us as well, where I think there is, at least for the foreseeable future, fairly strong sentiment and strength in that supply lineup, in particular on the live music side. .

Got it. Yes. .

I think the one other comment I'd point to from Live Nation is they have talked about their bandwidth to support the demand on the supply side. They actually highlighted that there is a limit to the number of major tours that the industry and infrastructure can support.

And while they didn't explicitly say it, it sounded like they alluded to, butting up against that capacity, which is part of why they are looking at '23 and '24 pipelines already. So I think certainly, relative to as they say one-and-done type supply strength environment, I think we feel pretty good that there's going to be a longer run than that. .

Got it. That's very helpful.

And then secondly, can you maybe share any color on your fee structure and where your sort of fees rank compared to some of your competitors? And are there any opportunities for efficiency gains that could maybe help reduce fees while maintaining margins?.

Yes. So we certainly look to be competitively priced across the landscape. I think if you were to pull up illustrative ticket across our and other marketplaces, there's a pretty good chance that we're going to be the lowest price alternative just on that first transaction.

And I think in some instances, you'll find we're meaningfully lower priced than certain alternatives. I'll leave it to your own exercise to figure out which of those fall into the close and not-so-close buckets. .

Where I think it gets really compelling is on the loyalty program. If you complete purchases such that you buy 10 tickets from us and you earn that free ticket, when you compare our competitive upfront prices where we're off already the lowest price and then layer on the benefits of the loyalty, it becomes a very meaningful difference.

And so I think getting folks into that repeat behavior is where it gets exciting for us, both from a volume and a margin standpoint because if people know they have a better economic proposition with us, they will come directly to our properties. That helps with the margins on the take rate that we are generating.

And so I think that would be the main efficiency over time as you see consumer behavior evolve to come direct to our site and repeat more frequently because of the loyalty program. .

Our next question coming from the line of Andrew Marok with Raymond James. .

I wanted to talk a little bit about the seller side of the equation.

Can you give us some color on trends you're seeing with SkyBox? I guess, what are some of the key product improvements you've been making recently on the platform? And what are you seeing in terms of non-SkyBox sellers on your platform coming on or share shifts among other ERP platforms?.

Andrew, yes, great question. As a 2-sided marketplace, we are actually really proud of the support that we provide to the seller part of the ecosystem. And SkyBox remains a pivotal and key investment for us to continue to drive value there.

We continue to enhance that on the technology front where sellers are now able to have more intelligent dashboards and data that truly help them grow their businesses, which is a focus for ours. .

On top of that, we've invested in building up a fulfillment part of that organization for SkyBox users as well, assisting sellers at a better cost structure to handle the logistics and fulfillment, both electronically and physically of tickets.

And what we've seen there is that we've continued to grow share on the ERP installed base on the seller side, where we've seen non-SkyBox users move on to SkyBox at a higher rate than they have in the past. And that continues to, I think, drive deeper and more vested relationships with the seller community. .

Our next question coming from the line of Thomas Forte with D.A. Davidson. .

Great. So first off, Stan and Larry congrats on the quarter and making it public. So one question and one follow-up since this is your first call after coming public. Can you talk about the long-term growth rate for the category? And what gives you confidence in your ability to take share, including SkyBox and loyalty. And then one follow-up. .

Yes. Thanks, Tom. So I think as we view the long-term industry growth rate, we think it's in the 7% to 10% range. And that figure is really normalized after you get through whatever benefits of the pent-up demand that you see coming out of the pandemic look like. .

Yes, I think likely slightly higher growth than that blended rate in the concert category, in particular, perhaps slightly lower growth than that in sports, largely driving that difference is the ability to have somewhat untapped capacity in concerts, much easier to add more shows at venues than it is to add teams to sports league.

So I think we feel pretty good about that high single-digit industry growth rate across Vivid Seats' history, it's been a consistent share gainer. And so as you touched on, I feel really good with our relationships on both sides of the marketplace.

SkyBox is a wonderful tool to stay close to seller needs and evolving dynamics to make sure that we are enabling sellers to grow their businesses. .

And alongside that, I think particularly excited about the opportunity to have us to grow consumer awareness. I believe that has been an area that, frankly, has been underinvested in to date. So anticipate some pretty meaningful benefit relative to that historical trajectory, which already was taking share. .

And then the second question I had is, on a long-term basis, your business model generates very impressive free cash flow.

How do you think about use of cash including investing in the business and M&A?.

Tom, I think one of the great things, I think, as you said about our business and certainly some of the outperformance this year is we find ourselves in a really, really strong position on the balance sheet, where we're really in a net cash position now where we came from one where we had significant debt on the business.

As we look to the future, what you'll see is, I think, we've got an option -- we've got options in front of us and certainly, playbooks to execute on, one, on the organic side, where we can continue to drive, I'd say, really, it's around value to consumers and then driving awareness to that, whether it's through our brand marketing efforts or continuing to invest in our industry-leading loyalty program, we're going to be aggressive there.

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On the M&A side, I think again, both with a strong balance sheet as well as a new public currency, we're also going to be certainly opportunistic and aggressive where opportunities should surface.

So really, I come back to I think we are in a great spot from a balance sheet, from a product that we have for consumers at a really opportune time to take advantage of those opportunities and what you'll see us do is be aggressive as those opportunities surface. .

Our next question coming from the line of Dan Kurnos with Benchmark. .

Congrats guys. Just a couple here. Just to go back to Jason's question, I know the elevated levels of AOS or ticket, kind of the ticket prices may not be sustainable, but Live Nation also called out a structurally higher level of consumer spend in the marketplace right now.

So -- and it seems like they're trying to obviously raise kind of this premium sort of front-of-house type tickets, which feels like it will set at least a higher floor on sort of what the norm reverts to. And I don't know if we ever get the same large delta over time.

But can you just kind of give us your thoughts on sort of how sustainable kind of that higher level of ticket price is and how it's impacting your forecast? And then I have a follow-up. .

Yes. So I think if you go back in time, you did see pretty steady growth in AOS at something in the GDP, GDP plus 1 to 2-point range, so steady 3% to 4% increase in average order size, which I think was generally marching in tandem to pricing in the underlying primaries.

I think it intuitively makes sense that there's a correlation between primary and secondary pricing over time. .

In our forecast that we had put forward previously, we essentially assume that average order size stayed flat, so effectively a negative break from historical trajectory.

I think what we've seen to date and what you hear in Live Nation's commentary suggests that, if anything, there's likely a break to the upside in their opinion versus our projected break to the downside from historical trends.

So I think there's certainly some optimism around the ability to do better than what we had put into our long-term forecast previously. .

In the near term, I think as you saw our AOS going from $400 in Q2 to $300 in Q3. We're still a little more in the consortium phase of supply and demand leveling out. I think still optimistic that average order size will be robust next year.

But we're not quite at the level of stability where I think you can go quarter-to-quarter and draw definitive conclusions on how pricing is trending for the long term. .

Got it. That's super helpful. And I know we talked a little bit about this on Analyst Day, and it's still super early, but just any kind of updates on -- well, first of all, I heard your live read on ESPN radio the other day. So a very underappreciated channel, I thought that was interesting.

Just any thoughts on kind of as the brand campaign continues to progress here, sort of what you're seeing? KPIs? Anything kind of updates on loyalty adoption, just how you're thinking about toggling that switch, understanding that you guys have super low unaided brand awareness anyway to target, but you've already seen a quadrupling of GMV shifting over to mobile and now you've got the new app launch.

So just kind of maybe you can parse some of that out for us as to what you're looking for. .

Yes. Dan, so I think -- well, glad you heard it because glad that we're making a wave literally there with folks.

As Larry mentioned, I think we've been aggressive in pulling forward some of our anticipated 2022 brand spend and I think what you experienced and what we're currently testing is certainly the efficacy of what is non-digital channels for us, whether that is terrestrial radio, certainly some media, some out of home.

We're doing that in select markets as we try to get a disciplined read on the efficacy there. Being very cognizant that brand building is a long-term effort. As continue to launch, and we're very early in the progress.

I think the one thing I'd tell you guys, which I think is a testament to, I think, the product work that our teams have done as well as some of the early potential signs of brand awareness is we are seeing that our app traffic is up, and we're also seeing, I think, folks start to use the features embedded within our app like favoriting artists at greater than 200% what they have historically, which I think are good long-term indicators of the fact that they are starting to engage with our product beyond a transactional basis, engage with our brand.

And when you combine that then with the currency, really the entrenched currency they have in our loyalty program as well as the additional perks that we have and we'll continue to invest in, I think we feel fairly bullish about our ability to continue to build long term value for our customers. .

Got it.

And I will give you guys a third, but just is there any color you guys want to offer publicly on the DraftKings investment knowing that, that was, I think, done at the sponsor level?.

Yes. I think we're certainly excited and thankful for that investment, right? As we look to solidify the partnership there, certainly, the DraftKings benefits for our users and our loyalty program is something that both of us were excited about and something that I think we'll continue to look at creative ways to work together in the future. .

And our next question coming from the line of Daniel Adam with Loop Capital Markets. .

Two for me. First, you kind of alluded to this already, but Live Nation clearly had some encouraging comments about the outlook for next year.

And I guess at this point, how much visibility do you guys have into 2022? And what kind of quarterly cadence for GOV revenues and EBITDA, would you expect for next year? And then second, just as a follow-up on the DraftKings question.

What would be the timing of any sort of partnership deals that we might see between Vivid and DraftKings?.

Yes. Thanks, Dan. So on the outlook into 2022, I think, in particular, you'll find that concerts have a number of the major tours for the next year come on sale in late Q4 of the prior year.

So we are really entering that window where in the normal course of operations, you'll see some pretty meaningful tours get announced and launched, which provide a healthy amount of insight into the following year. .

2022 is a bit of a unique one. I know you had a number of previously scheduled concerts and tours that were postponed. And so the 2020 (sic) [ 2022 ] calendar will be a mix of rescheduled and new events. So we probably have a little more visibility sitting here today than we would normally on this day in a typical year.

But still the next 6 weeks will be a pretty meaningful and important window to get a better sense for just how robust the calendar is going to be. .

So the question on seasonality, at this point, barring anything unforeseen, which is certainly possible, but barring that, I would anticipate a fairly "regular" seasonality cadence. And in a normal year, think of Q4 seasonally strongest, roughly 30% of our year will occur in Q4 with the remaining 70% split ratably across Q1 to Q3. .

And then on the DraftKings question, I think we are excited to continue looking at the opportunity and maybe to refresh what we announced when we launched our loyalty program, and it's live currently, we've always been really bullish on, a, driving engagement with consumers into our app; and b, ways to look for adjacencies that had strong affinity for, again, our users.

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And so at launch of our new loyalty program, we already announced a very [ deep partnership ] with DraftKings where we reward our users with free DraftKings dollars if they attain new loyalty tiers.

And so I think that's probably stage 1 of what we'll do to continue really looking at ways to engage our users in unique ways where they really get augmented and accretive benefit from transacting with us. .

And I'm showing no further questions at this time. Ladies and gentlemen, that does conclude our call for today. Thank you for your participation. You may now disconnect. Everyone, have a great day..