MoneyLion (ML) - 2022 Q4 - Annual Report

Revenue Breakdown - For the year ended December 31, 2022, the company generated $219.0 million in revenue from its Consumer business, accounting for 64.3$121.8 million from its Enterprise business, representing 35.7% of total revenues[80] - Adjusted Revenue for the Consumer business was $206.5 million, representing 62.9$121.8 million, or 37.1% of total Adjusted Revenue[80] - The company’s revenue from the Consumer Marketplace and Enterprise Marketplace is based on performance metrics such as clicks, impressions, and completed transactions[82] Credit Facilities - The company has a $100 million credit facility (ROAR 1 SPV Credit Facility) with$83.0 million outstanding as of December 31, 2022, and a $125 million credit facility (ROAR 2 SPV Credit Facility) with$63.0 million outstanding[84] Partnerships and Services - The company relies on third-party providers such as Pathward for deposit accounts and debit card services, and DriveWealth for brokerage and custodial services[85][91] - The MoneyLion Crypto offering is supported by Zero Hash, which pays the company a share of fees earned from customers for digital currency transactions[93] - The partnership with Pathward allows the company to offer RoarMoney deposit accounts and debit cards, subject to regulation by the OCC and FDIC[110] - The company offers MoneyLion Crypto through a partnership with Zero Hash, which is registered with FinCEN and holds money transmitter licenses in most U.S. states[116] Employee and Culture - As of December 31, 2022, the company had a total of 677 employees, with approximately 15% in New York City, 45% in Kuala Lumpur, 17% in Jersey City, 4% in Santa Monica, and 1% in Sioux Falls, while 18% worked remotely[101] - The company emphasizes a high-performance culture and offers comprehensive benefits, including health insurance, paid time off, a 401(K) retirement plan with employer matching, and mental health support[104] - The company has established employee resource groups to promote diversity, including initiatives like "Here Women Roar" for women's advancement and "Roar With Pride" for LGBTI+ support[105] Regulatory Environment - The regulatory environment is complex, with extensive regulations affecting consumer finance, privacy, and digital assets, which may impact the company's operations[106] - ML Wealth, the company's investment adviser, is subject to the Investment Advisers Act of 1940, requiring compliance with anti-fraud provisions and fiduciary duties[111] - MoneyLion Securities, a wholly-owned subsidiary, is registered with the SEC and FINRA, subject to regulations covering all aspects of broker-dealer operations[113] - As of December 31, 2022, MoneyLion Securities was in compliance with the Uniform Net Capital Rule, maintaining net capital above minimum requirements[114] - The legal status of digital assets as "securities" under U.S. federal law remains uncertain, impacting the company's regulatory compliance and potential liabilities[118] - The company is subject to regulation by the Consumer Financial Protection Bureau (CFPB), which has broad authority to enforce federal consumer financial protection laws, potentially increasing compliance costs and impairing profitability[126] Compliance and Risk Management - The company has developed and operates Anti-Money Laundering (AML) and sanctions compliance programs to prevent financial crimes, overseen by a designated compliance officer[131] - The company collects and processes Personally Identifiable Information (PII) and is subject to various privacy laws, including the Gramm-Leach-Bliley Act and the California Consumer Privacy Act, which impose obligations on data handling practices[132] - The company has built fraud detection capabilities to protect customers, utilizing Know Your Customer (KYC) protocols and an automated fraud model[134] - The technology infrastructure is designed to optimize data storage and processing, with multiple layers of protection for business continuity and cybersecurity[135] Market and Interest Rate Risks - A one percent change in interest rates on variable interest rate debt would result in an approximately $0.9 million impact to annual interest expense, based on principal balances as of December 31, 2022[488] - The company is exposed to market risks primarily due to fluctuations in interest rates, which could adversely impact customer engagement and loan performance[487] Marketing Compliance - The company has established policies to comply with federal and state laws regarding marketing activities, including the Telephone Consumer Protection Act and the CAN-SPAM Act[127] Intellectual Property - The company has not historically focused on patents and patent applications, relying instead on a combination of intellectual property rights and confidentiality procedures to protect proprietary rights[140] Seasonal Revenue Fluctuations - The company expects seasonal fluctuations in revenue, with potential increases during the fourth quarter due to holiday spending and variations in demand for loan products[100] Competitive Landscape - The competitive landscape includes traditional banks, non-bank digital providers, and emerging fintech companies, with the company focusing on personalized financial products and technology-driven solutions[98][99] Cryptocurrency Offerings - As of December 31, 2022, the only cryptocurrencies available through MoneyLion Crypto were Bitcoin, Bitcoin Cash, Ether, and Litecoin, with plans to evaluate expanding offerings based on customer demand[93]