The following discussion and analysis provides information which our management
believes is relevant to an assessment and understanding of our consolidated
results of operations and financial condition. The discussion should be read
together with our unaudited condensed consolidated financial statements and
related notes that are included elsewhere in this Quarterly Report. This
discussion may contain forward-looking statements based upon current
expectations that involve risks and uncertainties. Our actual results may differ
materially from those anticipated in these forward-looking statements as a
result of various factors, including those set forth under "Special Note
Regarding Forward-Looking Statements" and "Risk Factors" or in other parts of
this Quarterly Report.

Overview

At Nextdoor, our purpose is to cultivate a kinder world where everyone has a
neighborhood they can rely on. Neighbors around the world turn to Nextdoor to
receive trusted information, give and get help, get things done, and build real
world connections with those nearby - neighbors, businesses, and public
services. By fostering these connections, both online and in the real world,
Nextdoor builds stronger, more vibrant, and more resilient neighborhoods. As of
June 30, 2022, Nextdoor was in more than 295,000 neighborhoods around the world
and in nearly 1 in 3 households in the United States.

Key business metrics for the three months ended June 30, 2022 are as follows:

•Weekly Active Users ("WAUs") were 36.9 million, an increase of 26% compared to the three months ended June 30, 2021.

•Average revenue per weekly active user ("ARPU") was $1.48, a decrease of 6% compared to the three months ended June 30, 2021.

Financial Results as of and for the three and six months ended June 30, 2022 are as follows:



•Revenue for the three months ended June 30, 2022 was $54.5 million, an increase
of 19% compared to the three months ended June 30, 2021. Revenue for the six
months ended June 30, 2022 was $105.5 million, an increase of 32% compared to
the six months ended June 30, 2021.

•Total costs and expenses for the three months ended June 30, 2022 were $92.8
million, an increase of 38% compared to the three months ended June 30, 2021.
Total costs and expenses for the six months ended June 30, 2022 were $177.0
million, an increase of 40% compared to the six months ended June 30, 2021.

•Net loss for the three months ended June 30, 2022 increased 71% to $(36.8)
million, compared to $(21.5) million for the three months ended June 30, 2021.
Net loss for the six months ended June 30, 2022 increased 50% to $(69.8)
million, compared to $(46.6) million for the six months ended June 30, 2021.

•Adjusted EBITDA loss for the three months ended June 30, 2022 increased 78% to
$(20.0) million, compared to $(11.3) million for the three months ended June 30,
2021. Adjusted EBITDA loss for the six months ended June 30, 2022 increased 42%
to $(40.0) million, compared to $(28.1) million for the six months ended
June 30, 2021.

•Cash, cash equivalents, and marketable securities were $666.3 million as of June 30, 2022.

See "Non-GAAP Financial Measure" below for more information and for a reconciliation of net loss, the most directly comparable financial measure calculated and presented in accordance with U.S. generally accepted accounting principles ("GAAP"), to Adjusted EBITDA.

Recent Developments

Closing of Transactions



On November 5, 2021, we consummated the Business Combination and the PIPE
Investment (as described in the unaudited condensed consolidated financial
statements included elsewhere in this Quarterly Report) (collectively, the
"Reverse Recapitalization"). Reported results from operations included herein
prior to the Reverse Recapitalization are those of Legacy Nextdoor. Each share
of Legacy Nextdoor common stock that was issued and outstanding immediately
prior to the Closing Date, after giving effect to the conversion of all issued
and outstanding shares of Legacy Nextdoor preferred stock to Legacy Nextdoor
common stock, was canceled and converted into a number of shares of Nextdoor
Class B common stock equal to the exchange ratio of 3.1057 as calculated in
accordance with the Merger Agreement ("Exchange Ratio") multiplied by the number
of shares of Legacy Nextdoor common stock.
The Merger was accounted for as a reverse recapitalization in accordance with
GAAP. Under this method of accounting, KVSB was treated as the "acquired"
company for financial reporting purposes. Accordingly, the financial statements
of Nextdoor represent the
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continuation of the financial statements of Legacy Nextdoor, with the Merger
reflected as the equivalent of Nextdoor issuing common stock for the net assets
of KVSB, accompanied by a recapitalization. The net assets of KVSB were
recognized as of the Closing at historical cost, with no goodwill or other
intangible assets recorded. Operations prior to the Merger are those of Legacy
Nextdoor and Legacy Nextdoor's operations are the only ongoing operations of
Nextdoor.

Key Business Metrics

In addition to the measures presented in our unaudited condensed consolidated
financial statements, we use the following key business metrics to evaluate our
business, measure our performance, develop financial forecasts, and make
strategic decisions:

Weekly Active Users (WAUs)



We define a WAU as a Nextdoor user who opens our application, logs on to our
website, or engages with an email with monetizable content at least once during
a defined 7-day period.1 We calculate average WAUs for a particular period by
calculating the count of unique users, on a rolling basis for the past seven
days, for each day of that period, and dividing that sum by the number of days
in that period. We assess the health of our business by measuring WAUs because
we believe that weekly usage best captures the cadence at which we expect a
healthy user base to engage with, and derive the most utility from our platform,
and by extension their neighborhood. We also present WAUs by geography because
we are more advanced in engagement and monetization in the United States than
internationally.

In September 2021, Apple released changes to the Apple email client available on
its operating systems, including iOS 15 and iPadOS 15, which limit our ability
to measure user engagement with emails containing monetizable content for users
that use the Apple email client. The introduction of these changes impacts our
ability to accurately calculate a portion of WAUs for periods following the
adoption of the updated operating systems. Following this introduction, we use
estimates for these user engagement numbers based on historical data sets, as
well as data from users who engage with Nextdoor's monetizable content on email
clients other than Apple email.

Our WAU for the three months ended June 30, 2022 and 2021 were 36.9 million and
29.2 million, respectively, which represents 26% growth period over period. As
illustrated below, our international WAUs have generally grown at a faster rate
than our U.S. WAUs, and we expect this international growth to continue to
outpace U.S. growth in the near term.

1 Emails with monetizable content are emails with a primary purpose to regularly
inform users about topics that are relevant to them, and are therefore
appropriate for delivering ads to users. These emails comprise almost all of the
emails that we send our users and include, but are not limited to, new, trending
and top posts, weekly and anytime digests, welcome emails and urgent and
emergency alerts. We earn revenue from delivery of ad impressions in emails with
monetizable content on either a cost per thousand ("CPM") basis, a cost per
click ("CPC") basis or on a fixed-fee basis. While we have the ability to serve
ads in all emails with monetizable content, we currently only do so on a portion
of the total.

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                     Quarterly Average Weekly Active Users

                                 (in millions)

                    [[Image Removed: kvsb-20220630_g1.jpg]]

[[Image Removed: kvsb-20220630_g2.jpg]][[Image Removed: kvsb-20220630_g3.jpg]]

Average Revenue per Weekly Active User (ARPU)



We generate revenue primarily from advertising. We measure monetization of our
platform through our ARPU metric. We define ARPU as our total revenue in that
geography during a period divided by the average of the number of WAUs in that
geography during the same period. We present ARPU on a U.S. and international
basis because we are more advanced in our monetization in the United States than
internationally.

U.S. ARPU is higher primarily due to our decision to focus our earliest monetization efforts there, the size and maturity of our audience in the United States, as well the size of the U.S. advertising market. For purposes of calculating ARPU, revenue by user


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geography is apportioned to each region based on a determination of the location
of the account where the revenue-generating activities occur. Our ARPU for the
three months ended June 30, 2022 and 2021 was $1.48 and $1.57, respectively. Our
ARPU reflects the seasonality of our advertising revenue, with the fourth
quarter typically being the strongest quarter of each year.

                                 Quarterly ARPU

                    [[Image Removed: kvsb-20220630_g4.jpg]]

[[Image Removed: kvsb-20220630_g5.jpg]][[Image Removed: kvsb-20220630_g6.jpg]]

Components of Results of Operations

Revenue



We generate substantially all of our revenue from the delivery of advertisements
on our platform which includes the delivery of advertising impressions sold on a
CPM basis and CPC basis, as well as on a fixed-fee basis. The majority of our
revenue is generated in the United States.

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Cost of Revenue



Cost of revenue consists primarily of expenses associated with the delivery of
our revenue generating activities, including the third-party cost of hosting our
platform and allocated personnel-related costs, which include salaries,
benefits, and stock-based compensation for employees engaged in development of
our revenue generating products. Cost of revenue also includes third-party costs
associated with delivering and supporting our advertising products and credit
card transaction fees related to processing customer transactions.

We expect cost of revenue will increase on an absolute dollar basis as neighbor
activity on our platform increases. While we expect to realize scale benefits
over time, our cost of revenue as a percentage of revenue may vary from
period-to-period and is expected to increase modestly over the near and medium
term as we invest in new products and features to further increase platform
engagement.

Research and Development



Research and development expenses consist primarily of personnel-related costs,
including salaries, benefits, and stock-based compensation for our employees
engaged in research and development, as well as costs for consultants,
contractors and third-party software. In addition, allocated overhead costs,
such as facilities, information technology, and depreciation are included in
research and development expenses.

We expect research and development expenses will increase on an absolute dollar basis due to investments that we are making in our platform. We expect that research and development expenses as a percentage of revenue will vary from period-to-period over the short term and decrease over the long term.

Sales and Marketing



Sales and marketing expenses consist of personnel-related and other costs which
include salaries, commissions, benefits, and stock-based compensation for
employees engaged in sales and marketing activities as well as other costs
including third-party consulting, public relations, allocated overhead costs,
and amortization of acquired intangible assets. Sales and marketing expenses
also include brand and performance marketing for both user and small and
mid-sized customer acquisition, and neighbor services, which includes
personnel-related costs for our neighbor support team, our outsourced neighbor
support function, and verification costs.

Performance marketing costs related to user acquisition largely consist of the
distribution of mailed invitations and, to a lesser extent, digital advertising.
Performance marketing costs related to small and mid-sized customer acquisition
largely consists of digital advertising and, to a lesser extent, direct mail
campaigns. Fluctuations in our performance marketing expenses are driven by a
variety of factors, including but not limited to: our target geographies,
whether we are acquiring users or businesses, assessment of return on investment
of marketing spend, strategic priorities, and seasonal factors.

We expect sales and marketing expenses will increase on an absolute dollar basis
due to continued investment in sales activities, increased investment in
marketing to acquire users, small and mid-sized customers, and further
investment in international expansion. We expect sales and marketing expenses as
a percentage of revenue will vary from period-to-period over the short term and
decrease over the long term.

General and Administrative

General and administrative expenses consist primarily of personnel-related
costs, including salaries, benefits, and stock-based compensation for certain
executives, finance, legal, information technology, human resources, and other
administrative employees. In addition, general and administrative expenses
include fees and costs for professional services, including consulting,
third-party legal and accounting services, and allocated overhead costs.

We expect general and administrative expenses will increase on an absolute
dollar basis for the foreseeable future to support our growth as well as due to
additional costs associated with legal, accounting, compliance, investor
relations, and other costs as a result of operating as a public company. We
expect general and administrative expenses as a percentage of revenue will vary
from period-to-period over the short term and decrease over the long term.

Interest Income

Interest income consists of interest earned on our cash, cash equivalents, and marketable securities.



Other Income (Expense), Net

Other income (expense), net consists primarily of unrealized gains and losses from the re-measurement of monetary assets and liabilities denominated in non-functional currencies, and foreign currency transaction gains and losses.


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Provision for Income Taxes



The provision for income taxes consists primarily of income taxes related to
foreign and state jurisdictions in which we conduct business. We maintain a full
valuation allowance on our U.S. federal and state deferred tax assets as we have
concluded that it is more likely than not that the deferred tax assets will not
be realized.

Results of Operations

The results of operations presented below should be reviewed in conjunction with
our unaudited condensed consolidated financial statements and related notes
thereto included elsewhere in this Quarterly Report. The following table sets
forth our unaudited condensed consolidated results of operations for the periods
presented.

                                                         Three Months Ended June 30,                 Six Months Ended June 30,
(in thousands)                                             2022                  2021                 2022                  2021
Revenue                                              $       54,541          $  45,778          $      105,541          $  80,165
Costs and expenses(1):
Cost of revenue                                              10,187              6,600                  19,242             12,937
Research and development                                     32,699             23,331                  61,659             44,151
Sales and marketing                                          32,627             26,356                  63,688             49,250
General and administrative                                   17,283             10,959                  32,433             20,288
Total costs and expenses                                     92,796             67,246                 177,022            126,626
Loss from operations                                        (38,255)           (21,468)                (71,481)           (46,461)
Interest income                                               2,153                 25                   2,644                 65
Other income (expense), net                                    (708)               (26)                   (893)              (174)
Loss before income taxes                                    (36,810)           (21,469)                (69,730)           (46,570)
Provision for income taxes                                       33                 30                      61                 69
Net loss                                             $      (36,843)         $ (21,499)         $      (69,791)         $ (46,639)


__________________

(1)Includes stock-based compensation expense as follows:



                                                         Three Months Ended June 30,                 Six Months Ended June 30,
(in thousands)                                             2022                  2021                 2022                 2021
Cost of revenue                                     $           494        

$ 334 $ 949 $ 598 Research and development

                                      9,874              4,880                 16,509              8,274
Sales and marketing                                           3,000              1,473                  4,996              2,750
General and administrative                                    4,176              2,480                  7,234              4,757
Total                                               $        17,544          $   9,167          $      29,688          $  16,379


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The following table sets forth the components of our unaudited condensed consolidated statements of operations as a percentage of revenue for each of the periods presented:



                                                 Three Months Ended June 30,                  Six Months Ended June 30,
(as a percentage of total revenue)               2022                  2021                  2022                  2021
Revenue                                              100  %                100  %                100  %                100  %
Costs and expenses:
Cost of revenue                                       19                    14                    18                    16
Research and development                              60                    51                    58                    55
Sales and marketing                                   60                    58                    60                    61
General and administrative                            32                    24                    31                    25
Total costs and expenses                             170                   147                   168                   158
Loss from operations                                 (70)                  (47)                  (68)                  (58)
Interest income                                        4                     -                     3                     -
Other income (expense), net                           (1)                    -                    (1)                    -
Loss before income taxes                             (67)                  (47)                  (66)                  (58)
Provision for income taxes                             -                     -                     -                     -
Net loss                                             (68) %                (47) %                (66) %                (58) %

Note: Certain figures may not sum due to rounding.

Comparison of the Three and Six Months Ended June 30, 2022 and 2021



Revenue

                           Three Months Ended June 30,                     Change                       Six Months Ended June 30,                       Change
(in thousands, except
percentages)                 2022                 2021               $                %                  2022                 2021                $                %
Revenue                $       54,541          $ 45,778          $ 8,763               19  %       $      105,541          $ 80,165          $ 25,376               32  %


Revenue increased by $8.8 million, or 19%, for the three months ended June 30,
2022 compared to the three months ended June 30, 2021. The increase was
primarily due to increased advertiser demand across our product offerings, and
increased user engagement as measured by a 26% increase in Q2 WAUs. ARPU
decreased 6% in the three months ended June 30, 2022 compared to the three
months ended June 30, 2021, as WAU growth outpaced the increase in the number of
impressions delivered, which was partially offset by an increase in the price
per delivered impression.

Revenue increased by $25.4 million, or 32%, for the six months ended June 30,
2022 compared to the six months ended June 30, 2021. The increase was primarily
due to increased advertiser demand across our product offerings, and increased
user engagement as measured by a 30% increase in WAUs. Year-to-date ARPU
increased 2% in the six months ended June 30, 2022 compared to the six months
ended June 30, 2021, primarily due to an increase in the price per delivered
impression.

Cost of revenue

                        Three Months Ended June 30,                  Change                      Six Months Ended June 30,                      Change

(in thousands, except
percentages)               2022              2021              $                %                  2022                2021               $                %
Cost of revenue        $  10,187          $ 6,600          $ 3,587               54  %       $      19,242          $ 12,937          $ 6,305               49  %


Cost of revenue increased by $3.6 million, or 54%, for the three months ended
June 30, 2022 compared to the three months ended June 30, 2021. The increase was
primarily due to $2.0 million higher third-party hosting costs due to increased
user growth and engagement, a $0.7 million increase in allocated
personnel-related costs, and a $0.5 million increase in third-party costs
associated with delivering and supporting our advertising products.

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Cost of revenue increased by $6.3 million, or 49%, for the six months ended
June 30, 2022 compared to the six months ended June 30, 2021. The increase was
primarily due to $3.6 million higher third-party hosting costs due to increased
user growth and engagement, a $1.2 million increase in allocated
personnel-related costs, and a $0.9 million increase in third-party costs
associated with delivering and supporting our advertising products.

Research and development



                           Three Months Ended June 30,                     Change                      Six Months Ended June 30,                       Change
(in thousands, except
percentages)                 2022                 2021               $                %                  2022                2021                $                %
Research and
development            $       32,699          $ 23,331          $ 9,368               40  %       $      61,659          $ 44,151          $ 17,508               40  %


Research and development expenses increased by $9.4 million, or 40%, for the
three months ended June 30, 2022 compared to the three months ended June 30,
2021. The increase was primarily due to a $7.9 million increase in
personnel-related costs primarily driven by an increase in headcount, a $1.0
million increase in third-party software costs, and a $0.3 million increase in
allocated overhead costs reflecting an increase in headcount.

Research and development expenses increased by $17.5 million, or 40%, for the
six months ended June 30, 2022 compared to the six months ended June 30, 2021.
The increase was primarily due to a $14.2 million increase in personnel-related
costs primarily driven by an increase in headcount, a $1.7 million increase in
third-party software costs, and a $0.8 million increase in allocated overhead
costs reflecting an increase in headcount.

Sales and marketing

                               Three Months Ended June 30,                     Change                      Six Months Ended June 30,                       Change
(in thousands, except
percentages)                     2022                 2021               $                %                  2022                2021                $                %
Personnel-related and
other                      $       20,760          $ 14,246          $ 6,514               46  %       $      38,104          $ 26,862          $ 11,242               42  %
Brand and performance
marketing                           8,696             9,302             (606)              (7) %              19,466            16,450             3,016               18  %
Neighbor services                   3,171             2,808              363               13  %               6,118             5,938               180                3  %
Total sales and marketing  $       32,627          $ 26,356          $ 6,271               24  %       $      63,688          $ 49,250          $ 14,438               29  %


Sales and marketing expenses increased by $6.3 million, or 24%, for the three
months ended June 30, 2022 compared to the three months ended June 30, 2021. The
increase was primarily due to a $6.5 million increase in personnel-related and
other costs, which was driven by an increase in headcount, a $0.3 million
increase in performance marketing costs to attract small and mid-sized
customers, partially offset by a $0.9 million decrease in performance marketing
costs for user acquisition.

Sales and marketing expenses increased by $14.4 million, or 29%, for the six
months ended June 30, 2022 compared to the six months ended June 30, 2021. The
increase was primarily due to an $11.2 million increase in personnel-related and
other costs, which was driven by an increase in headcount, a $2.7 million
increase in performance marketing costs to attract small and mid-sized
customers, and a $0.3 million increase in performance marketing costs for user
acquisition.

General and administrative



                            Three Months Ended June 30,                     Change                      Six Months Ended June 30,                      Change
(in thousands, except
percentages)                  2022                 2021               $                %                  2022                2021                $                %
General and
administrative          $       17,283          $ 10,959          $ 6,324               58  %       $      32,433          $ 20,288          $ 12,145              60  %


General and administrative expenses increased by $6.3 million, or 58%, for the
three months ended June 30, 2022 compared to the three months ended June 30,
2021. The increase was primarily due to a $3.7 million increase in
personnel-related costs which was

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driven by an increase in headcount, a $1.7 million increase in insurance expenses, and a $0.3 million increase in professional fees primarily related to operating as a public company.



General and administrative expenses increased by $12.1 million, or 60%, for the
six months ended June 30, 2022 compared to the six months ended June 30, 2021.
The increase was primarily due to a $5.7 million increase in personnel-related
costs which was driven by an increase in headcount, a $3.4 million increase in
insurance expenses, and a $2.0 million increase in professional fees primarily
related to operating as a public company.

Interest income



                       Three Months Ended June 30,                  Change                   Six Months Ended June 30,                   Change
(in thousands, except
percentages)
(NM = Not Meaningful)      2022             2021              $                %                2022             2021              $                %
Interest income        $   2,153          $   25          $ 2,128                  NM       $   2,644          $   65          $ 2,579                 NM


Interest income increased by $2.1 million for the three months ended June 30,
2022 compared to the three months ended June 30, 2021. The increase was
primarily driven by an increase in marketable securities and an improvement in
interest rates.

Interest income increased by $2.6 million for the six months ended June 30, 2022
compared to the six months ended June 30, 2021. The increase was primarily
driven by an increase in marketable securities and an improvement in interest
rates.

Other income (expense), net

                       Three Months Ended June 30,                 Change                  Six Months Ended June 30,                 Change
(in thousands, except
percentages)
(NM = Not Meaningful)     2022             2021              $               %               2022             2021              $               %
Other income
(expense), net         $   (708)         $  (26)         $ (682)                 NM       $   (893)         $ (174)         $ (719)                NM


Other expense increased by $0.7 million for the three months ended June 30, 2022
compared to the three months ended June 30, 2021. The increase was primarily due
to the periodic re-measurement of monetary assets and liabilities denominated in
non-functional currencies.

Other expense increased by $0.7 million for the six months ended June 30, 2022
compared to the six months ended June 30, 2021. The increase was primarily due
to the periodic re-measurement of monetary assets and liabilities denominated in
non-functional currencies.

Provision for income taxes

                               Three Months Ended June 30,                  Change                      Six Months Ended June 30,                     Change
(in thousands)                     2022             2021              $                %                  2022                2021              $                %
Provision for income taxes     $      33          $   30          $     3               10  %       $           61          $   69          $    (8)            (12) %


Provision for income taxes increased by less than $0.1 million for the three
months ended June 30, 2022 compared to the three months ended June 30, 2021. The
increase was primarily due to foreign income tax expenses.

Provision for income taxes decreased by less than $0.1 million for the six months ended June 30, 2022 compared to the six months ended June 30, 2021. The decrease was primarily due to foreign income tax expenses.

Liquidity and Capital Resources



Since inception, we have generated negative cash flows from operations and have
primarily financed our operations from net proceeds received from the sale of
equity securities, proceeds from the Reverse Recapitalization, and payments
received from our customers. We currently have no debt outstanding.

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We have generated losses from our operations, as reflected in our accumulated
deficit of $550.1 million as of June 30, 2022. We incurred operating losses and
cash outflows from operations by supporting the growth of our business. We
expect these losses and operating cash outflows to continue for the foreseeable
future. We also expect to incur significant research and development, sales and
marketing, and general and administrative expenses over the next several years
in connection with the continued development and expansion of our business.

As of June 30, 2022, we had $666.3 million in cash, cash equivalents, and
marketable securities. We anticipate satisfying our short term cash
requirements, including meeting our working capital and capital expenditure
requirements, with our existing cash, cash equivalents, and marketable
securities. In the long term, we may satisfy our cash requirements with cash,
cash equivalents, and marketable securities on hand or with proceeds from a
future equity or debt financing. Our ability to support our requirements and
plans for cash, including working capital and capital expenditure requirements,
will depend on many factors, including the rate of our revenue growth, the
timing and extent of spending on research and development efforts and other
business initiatives, the expansion of sales and marketing activities, the
introduction of new and enhanced product offerings and features, and the
continuing market adoption of our platform, the number of shares repurchased
under our share repurchase program (the "Share Repurchase Program"), and our
ability to obtain equity or debt financing.

To the extent existing cash, cash equivalents, and marketable securities are
insufficient to fund our working capital and capital expenditure requirements,
or should we require additional cash for other purposes, we may attempt to raise
additional capital through the sale of equity or debt securities. If we raise
additional funds through the issuance of equity or debt securities, those
securities may have rights, preferences, or privileges senior to the rights of
our Class A and Class B common stock, and our stockholders may experience
dilution. Any future indebtedness we incur may result in terms that could also
be unfavorable to our equity investors. There can be no assurances that we will
be able to raise additional capital on terms we deem acceptable, or at all. The
inability to raise additional capital as and when required would have an adverse
effect, which could be material, on our results of operations, financial
condition, and ability to achieve our business objectives.

On June 1, 2022, our Board of Directors authorized and approved the Share
Repurchase Program to repurchase up to $100.0 million in aggregate of our Class
A common stock, with the authorization to expire on June 30, 2024. The timing of
any repurchases will depend on market conditions and other investment
opportunities, and will be made at our discretion. We currently anticipate that
the Share Repurchase Program will extend through June 30, 2024, or such shorter
period if $100.0 million in aggregate of shares of our Class A common stock have
been repurchased. The Share Repurchase Program does not obligate us to
repurchase any dollar amount or number of shares, and the program may be
extended, modified, suspended, or discontinued at any time. During the three
months ended June 30, 2022, we repurchased and retired 3,061,092 shares of Class
A common stock at an average purchase price of $3.43 per share for an aggregate
repurchase price of $10.5 million. Subsequent to June 30, 2022 and through
August 9, 2022, we repurchased and retired an additional 4,547,680 shares of
Class A common stock at an average purchase price of $3.63 per share for an
aggregate repurchase price of $16.5 million, of which $14.5 million was funded
by a prepayment made as of June 30, 2022.

Off-Balance Sheet Arrangements



We did not have during the periods presented, and we do not currently have, any
commitments or obligations, including contingent obligations, arising from
arrangements with unconsolidated entities or persons that have or are reasonably
likely to have a material current or future effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, cash requirements, or capital resources.

Cash Flows

The following table summarizes our cash flows for the periods presented:



                                                                           Six Months Ended June 30,
(in thousands)                                                              2022                    2021
Net cash used in operating activities                              $      (28,121)              $ (25,593)
Net cash provided by (used in) investing activities                $     (435,600)              $  12,865
Net cash provided by (used in) financing activities                $      (18,397)              $   7,457


Operating activities

Cash used in operating activities during the six months ended June 30, 2022 was
$28.1 million which resulted from a net loss of $(69.8) million, adjusted for
non-cash charges of $31.0 million and net cash inflows of $10.7 million from
changes in operating assets and liabilities. Non-cash charges primarily
consisted of $29.7 million of stock-based compensation expense and $2.7 million
of depreciation and amortization expense. The net cash inflows from changes in
operating assets and liabilities were primarily due to a

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$4.3 million increase in accrued expenses and other current liabilities, a $3.7
million decrease in accounts receivable, a $3.5 million decrease in prepaid
expenses and other current assets, and a $3.4 million decrease in operating
lease right-of-use assets due to normal amortization. These amounts were
partially offset by a $3.5 million decrease in operating lease liabilities due
to lease payments and a $0.8 million decrease in accounts payable.

Cash used in operating activities during the six months ended June 30, 2021 was
$25.6 million which resulted from a net loss of $(46.6) million, adjusted for
non-cash charges of $18.7 million and net cash inflows of $2.4 million from
changes in operating assets and liabilities. Non-cash charges primarily
consisted of $16.4 million of stock-based compensation expense and $2.2 million
of depreciation and amortization expense. The net cash inflow from changes in
operating assets and liabilities was primarily the result of a $3.3 million
decrease in operating lease right-of-use assets due to normal amortization, a
$1.6 million increase in accrued expenses and other current liabilities, and a
$0.9 million increase in accounts payable. These amounts were partially offset
by a $2.5 million decrease in operating lease liabilities due to lease payments
and a $1.4 million decrease in prepaid expenses and other current assets.

Investing activities



Cash used in investing activities for the six months ended June 30, 2022 was
$435.6 million, which consisted of purchases of marketable securities of $482.7
million and the purchase of property and equipment of $1.3 million. This was
partially offset by proceeds from maturities of marketable securities of $46.6
million and proceeds from sales of marketable securities of $1.7 million.

Cash provided by investing activities for the six months ended June 30, 2021 was $12.9 million, which consisted of proceeds from maturities of marketable securities of $33.8 million. This was partially offset by the purchases of marketable securities of $14.6 million and the purchase of property and equipment of $6.3 million.

Financing activities



Cash used in financing activities for the six months ended June 30, 2022 was
$18.4 million, which included prepayment under the Share Repurchase Program of
$14.5 million, repurchases of common stock of $10.5 million, tax withholdings on
release of restricted stock units of $0.7 million, and payment of deferred
transaction costs of $0.3 million, partially offset by $7.6 million of proceeds
from the exercise of stock options, net of repurchases.

Cash provided by financing activities for the six months ended June 30, 2021 was
$7.5 million, which reflected $7.9 million of proceeds from the exercise of
stock options, net of repurchases. This was partially offset by the payment of
deferred transaction costs of $0.4 million.

Non-GAAP Financial Measure

Adjusted EBITDA

Adjusted EBITDA is a non-GAAP financial measure that represents our net loss adjusted for depreciation and amortization, stock-based compensation, net interest income, provision for income taxes, and acquisition-related costs.



We use Adjusted EBITDA in conjunction with GAAP measures as part of our overall
assessment of our performance, including the preparation of our annual operating
budget and quarterly forecasts, to evaluate the effectiveness of our business
strategies and to communicate with our Board of Directors concerning our
financial performance. We believe Adjusted EBITDA is also helpful to investors,
analysts, and other interested parties because it can assist in providing a more
consistent and comparable overview of our operations across our historical
financial periods. Adjusted EBITDA has limitations as an analytical tool,
however, and you should not consider it in isolation or as a substitute for
analysis of our results as reported under GAAP. Because of these limitations,
you should consider Adjusted EBITDA alongside other financial performance
measures, including net loss and our other GAAP results. In evaluating Adjusted
EBITDA, you should be aware that in the future we may incur expenses that are
the same as or similar to some of the adjustments in this presentation. Our
presentation of Adjusted EBITDA should not be construed to imply that our future
results will be unaffected by the types of items excluded from the calculation
of Adjusted EBITDA. Adjusted EBITDA is not presented in accordance with GAAP and
the use of this term varies from others in our industry.

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The following is a reconciliation of net loss, the most comparable GAAP measure, to Adjusted EBITDA:



                                                   Three Months Ended June 30,                 Six Months Ended June 30,
(in thousands)                                       2022                  2021                 2022                  2021
Net loss                                       $      (36,843)         $ (21,499)         $      (69,791)         $ (46,639)
Depreciation and amortization                           1,374              1,072                   2,704              2,155
Stock-based compensation                               17,544              9,167                  29,688             16,379
Interest income                                        (2,153)               (25)                 (2,644)               (65)
Provision for income taxes                                 33                 30                      61                 69
Adjusted EBITDA                                $      (20,045)         $ (11,255)         $      (39,982)         $ (28,101)

Critical Accounting Policies and Estimates



We prepare our condensed consolidated financial statements in accordance with
GAAP. Preparing condensed consolidated financial statements requires us to make
estimates and assumptions that affect the reported amounts of assets,
liabilities, revenue, expenses, and related disclosures. We evaluate our
estimates and assumptions on an ongoing basis. Our estimates are based on
historical experience and various other assumptions that we believe to be
reasonable under the circumstances. Our actual results could differ from these
estimates.

There have been no material changes to our critical accounting policies requiring estimates, assumptions, and judgments as compared to the critical accounting policies and estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2021.

JOBS Act Accounting Election



We are currently an "emerging growth company" as defined in Section 2(a) of the
Securities Act, and have elected to take advantage of the benefits of the
extended transition period for complying with new or revised accounting
standards. We expect to use this extended transition period for complying with
new or revised accounting standards until the earlier of the date we (a) are no
longer an emerging growth company or (b) affirmatively and irrevocably opt out
of the extended transition period provided for in the JOBS Act. This may make it
difficult or impossible to compare our financial results with the financial
results of another public company that is either not an emerging growth company
or is an emerging growth company that has chosen not to take advantage of the
extended transition period exemptions because of the potential differences in
accounting standards used.

In addition, we intend to rely on the other exemptions and reduced reporting
requirements provided by the JOBS Act. Subject to certain conditions set forth
in the JOBS Act, as an emerging growth company, we are not required to, among
other things: (a) provide an auditor's attestation report on our system of
internal control over financial reporting pursuant to Section 404(b) of the
Sarbanes-Oxley Act; (b) provide all of the compensation disclosure that may be
required of non-emerging growth public companies under the Dodd-Frank Wall
Street Reform and Consumer Protection Act; and (c) disclose certain executive
compensation-related items such as the comparison of the Chief Executive
Officer's compensation to median employee compensation.

Because the market value of our common stock held by non-affiliates as of June
30, 2022, exceeded $700 million, we will lose emerging growth company status
under the JOBS Act as of December 31, 2022.

Recently Issued Accounting Pronouncements

Refer to Note 2 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report for more information regarding recently issued accounting pronouncements.

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