−Removed: Cardlytics operates an advertising platform within financial institutions’ (“FIs”) digital channels, which include online, mobile, email and various real-time notifications.
−Removed: Our partnerships with FIs provide us with access to their anonymized purchase data and digital banking customers.
−Removed: By applying advanced analytics to this aggregation of purchase data, we make it actionable, helping marketers identify, reach and influence likely buyers at scale, and measure the true sales impact of their marketing spend.
−Removed: We have strong relationships with leading marketers across a variety of industries, including retail, restaurant, travel and entertainment, telecommunications, subscription services, direct to consumer, and grocery.
−Removed: Our purchase intelligence, coupled with our access to customers using FIs’ online, mobile, and email channels, enables us to help solve fundamental problems for marketers.
−Removed: Marketers increasingly have access to data on the purchase behavior of their customers in their own stores and websites.
−Removed: However, they lack insight into their customers’ purchase behavior outside of their stores and websites, as well as the purchase behavior of individuals who are not yet customers.
−Removed: The reality is, no matter how robust their own customer data, marketers only see a small portion of their customers’ overall spend.
+Added: Our company’s mission is to redefine marketing by using data for good.
+Added: We work to accomplish this mission by operating an advertising platform within our own and our partners' digital channels, which include online, mobile applications, email, and various real-time notifications (the "Cardlytics platform").
+Added: We also operate a customer data platform which utilizes point-of-sale ("POS") data, including product-level purchase data, to enable marketers, in a privacy-protective manner, to perform analytics and targeted loyalty marketing and also enable marketers to measure the impact of their marketing (the "Bridg platform").
+Added: The partners for the Cardlytics platform are predominantly financial institutions ("FI partners") who provide us with access to their anonymized purchase data and digital banking customers.
+Added: The partners for the Bridg platform are merchants ("merchant data partners") who provide us with access to their POS data, including product-level purchase data.
+Added: By applying advanced analytics to the purchase data we receive, we make it actionable, helping marketers identify, reach and influence likely buyers at scale, and measure the true sales impact of their marketing spend.
+Added: We have strong relationships with leading marketers across a variety of industries, including retail, restaurant, travel and entertainment, direct-to-consumer, and grocery and gas.
+Added: Our purchase intelligence, coupled with our access to customers using our and our partners’ digital channels, enables us to help solve fundamental problems for marketers.
+Added: Marketers increasingly have access to data on the purchase behavior of their customers in their own stores, websites and loyalty programs.
+Added: However, they lack insight into their customers’ purchase behavior outside of their stores and websites, as well as the purchase behavior of individuals who are not yet their customers.
+Added: The reality is, no matter how robust their own customer data, marketers only see a small portion of their customers’ overall spending patterns.
As a result, it is very difficult for businesses to focus their marketing investments on the most valuable customers.
−Removed: By consolidating the largely untapped, high growth mobile and online banking channels of FIs, we enable marketers to reach potential customers across our network of FI partners through their digital banking accounts and present them relevant offers to save money at a time when they are thinking of their finances.
+Added: With the Cardlytics platform, we enable marketers to reach potential customers across our network of FI partners through their digital banking accounts and present them relevant offers to save money at a time when they are thinking of their finances.
+Added: With the Bridg platform, we enable marketers to leverage their own POS data and reach their customers across a wide variety of digital advertising channels that they would not otherwise be able to identify and reach.
Marketers are also challenged to measure the performance of their marketing.
This issue is particularly acute with respect to measuring the impact of marketing on in-store sales, where the vast majority of consumer spending occurs.
−Removed: We believe purchase intelligence is a disruptive opportunity in marketing and can comprehensively address these challenges by enabling marketers to precisely measure how marketing drives sales by “closing the loop”—both digital and in-store.
−Removed: Our platform also helps solve fundamental problems for FIs.
−Removed: Leveraging our powerful predictive analytics, we are able to create compelling cash back offers that have the potential to drive deeper and sustained use of the FI channels, which we believe reduces customer attrition and increases use of the FIs’ credit and debit cards.
−Removed: Today, our FI partners include Bank of America, National Association ("Bank of America"), JPMorgan Chase Bank, National Association (“Chase”) and Wells Fargo Bank, National Association (“Wells Fargo”), as well as many other national and regional financial institutions, including several of the largest bank processors and digital banking providers to reach customers of small and mid-sized FIs.
−Removed: Wells Fargo began a phased launch of our platform in the fourth quarter of 2019 that was completed in the second quarter of 2020.
−Removed: Revenue from the Cardlytics platform, which is net of Consumer Incentives, was $149.3 million, $210.4 million and $186.9 million for 2018, 2019 and 2020, respectively.
−Removed: During 2018, 2019 and 2020, our average monthly active users ("FI MAUs") were approximately 65.0 million, 122.6 million and 155.8 million, respectively, and our average revenue per user ("ARPU") was $2.30, $1.72 and $1.20, respectively.
−Removed: FI MAU and ARPU are performance metrics defined under the heading "Non-GAAP Measures and Other Performance Metrics" within Item 7 of this Annual Report.
−Removed: During 2018, 2019 and 2020, our net loss was $53.0 million, $17.1 million and $55.4 million, respectively.
−Removed: Our historical losses have been driven by our substantial investments to expand the use of our platform by both FIs and marketers and include significant non-cash charges.
−Removed: During 2018, 2019 and 2020, our net loss includes stock-based compensation expense of $26.8 million, $15.9 million and $32.4 million, respectively.
−Removed: In 2018, our net loss also includes a $6.8 million non-cash expense related to the change in fair value of our warrant liabilities and a $2.5 million non-cash expense related to the vesting of warrants issued to an FI partner that accelerated upon our IPO.
+Added: We believe our platforms transform purchase data into purchase intelligence, creating a disruptive opportunity to comprehensively address these challenges by enabling marketers to precisely measure how marketing drives both in-store and online sales through “closed loop-measurement.”
+Added: The Cardlytics Platform
+Added: Through the Cardlytics platform, marketers can deliver advertising content to customers in the form of an opportunity to earn rewards, which are funded with a portion of the fees we collect from marketers.
+Added: Additionally, the Cardlytics platform benefits customers by showing them relevant advertisements tailored to their specific needs based on their spending patterns to enhance their overall experience.
+Added: We maintain similar platforms in both the United States ("U.S.").
+Added: and United Kingdom ("U.K.").
+Added: The Cardlytics platform helps marketers find potential new customers that are active in their category but not currently shopping with them, or to grow their business with existing customers.
+Added: Our marketing is targeted and measured based on actual purchase data at a customer and account level.
+Added: However, all reporting is aggregated across consumers in our network of FI partners.
+Added: Unlike many other measurement solutions on which the marketing industry has historically relied, our measurements are not probabilistic or based on models, but are based on actual in-store and online purchases.
+Added: The breadth of our network of FI partners means that we are able to offer marketers the ability to optimize their marketing efforts to reach a large number of consumers through a single point of contact.
+Added: The Cardlytics platform also provides our marketers a scalable solution for driving customer loyalty and engagement whereby Cardlytics handles everything from contracting with marketers and creating, managing and reporting performance of their campaigns to attributing incentives to each of our partners' customers.
+Added: The Cardlytics platform helps solve fundamental problems for our FI partners.
+Added: Leveraging our powerful predictive analytics, we create compelling cash back offers that have the potential to drive deeper and sustained use of the FI's digital channels, which we believe reduces customer attrition and increases use of the FIs’ credit and debit cards.
+Added: Today, our FI partners include Bank of America, National Association ("Bank of America"), JPMorgan Chase Bank, National Association (“Chase”) and Wells Fargo Bank, National Association (“Wells Fargo”), as well as many other national and regional financial institutions, financial technology companies, virtual-only banks, and several of the largest bank processors and digital banking providers to reach customers of small and mid-sized FIs.
+Added: The Bridg Platform
+Added: The Bridg platform is a customer data platform, which utilizes POS data from our merchant data partners, including product-level purchase data to enable marketers, in a privacy-protective manner, to perform analytics and targeted loyalty marketing and also enable marketers to measure the impact of their marketing.
+Added: The Bridg platform's unique ability to identify, understand, and engage previously unreachable in-store customers is made possible through industry leading identity resolution, proprietary census of identity and behavior, and unique strategic data partnerships.
+Added: On May 5, 2021, we completed the acquisition of Bridg for purchase consideration of $578.9 million.
+Added: The purchase consideration consisted of a $350.0 million cash purchase price, subject to $2.8 million of adjustments and escrows, and contingent consideration with a fair value of $230.9 million at the time of the acquisition related to additional potential future payments.
+Added: At least 30% of the potential future payments will be in cash, with the remainder to be paid in cash or our common stock, at our option.
+Added: On March 5, 2021, we completed the acquisition of Dosh for purchase consideration of $277.6 million in a combination of cash and common stock.
+Added: The total purchase consideration consisted of a $150.0 million cash purchase price, subject to $6.6 million of adjustments and escrows, and $125.0 million of shares of our common stock at an agreed-upon price of $136.33 per share, subject to $7.6 million of fair value adjustments based upon our close date, for an acquisition date fair value of $117.4 million.
+Added: Refer to Note 4—Business Combinations to our consolidated financial statements for further information.
Purchase Intelligence
−Removed: Purchase data from FIs provides a secure view into where and when consumers are spending their money.
−Removed: Our technology aggregates and analyzes purchase data without any personally identifiable information ("PII") leaving the FI or otherwise being made available to us.
+Added: Purchase Data from our FI Partners
+Added: Purchase data from our FI partners provides a secure view into where and when consumers are spending their money.
+Added: The Cardlytics platform aggregates and analyzes purchase data without any personally identifiable information ("PII") leaving the FI or otherwise being made available to us.
The data from the FI is anonymized so that it cannot be associated with any one individual.
−Removed: Our platform analyzes online and in-store transactions across the United States ("U.S").
−Removed: and United Kingdom ("U.K."), including one in two debit and credit card transactions in the U.S.
−Removed: as of December 31, 2020.
−Removed: We believe that access to both debit and credit card purchase data at scale can only be obtained by partnering directly with FIs.
−Removed: This data allows us to serve relevant advertisements to our FIs’ customers through our native bank advertising channel.
+Added: The Cardlytics platform analyzes online and in-store transactions across the U.S.
+Added: In the U.S., the Cardlytics platform ingests approximately one in every two debit and credit card transactions as of December 31, 2021.
+Added: This data allows us to serve relevant advertisements to our FI partners’ customers through our native bank advertising channel.
We also leverage the power of purchase intelligence to provide marketers utilizing the Cardlytics platform with valuable insights into the preferences of their actual or potential customers wherever they shop.
+Added: Point-of-Sale Data from our Merchant Data Partners
+Added: Using POS data from our merchant data partners and our proprietary bureau of offline identity and behavioral information, the Bridg platform associates customer purchases with developed identifiers.
+Added: We then build privacy-protective profiles that include product-level purchase history and hundreds of customer attributes that power marketing and analytics.
Advanced Analytics Capabilities
−Removed: The advanced analytics we apply to our unique purchase dataset are what transforms it into valuable purchase intelligence.
+Added: The advanced analytics we apply to our unique purchase datasets are what transforms them into valuable purchase intelligence.
We use sophisticated quantitative methods to quickly access our massive volumes of data and make sense of what has happened—and, importantly, what is likely to happen.
−Removed: Our analytics makes our data actionable, enabling us to develop insights that marketers and FIs rely on to make more informed business decisions and more meaningful customer connections.
+Added: Our analytics makes our data actionable, enabling us to develop insights that marketers and partners rely on to make more informed business decisions and more meaningful customer connections.
We analyze the impact marketing campaigns have on in-store and online sales.
−Removed: Since we are able to measure sales impact, marketers can use our purchase intelligence to optimize their advertising efforts, increase their investment in the Cardlytics platform and enhance future campaigns.
+Added: Since we are able to measure sales impact, marketers can use our purchase intelligence to optimize their advertising efforts and increase their investment in the Cardlytics and Bridg platforms to enhance future campaigns.
Given our granular view into consumer spending across all categories, we can also help marketers identify share shift against their competition and learn more about where else their customers spend their money.
−Removed: For FIs, we use our analytics to optimize the offers we display to FI customers within our channel.
−Removed: By assigning relevancy scores to each offer based on what customers are most likely to buy, our platform can present the most relevant offers earlier in customers’ mobile and online banking sessions.
+Added: For our FI partners, we use our analytics to optimize the offers we display to customers within our Cardlytics platform.
+Added: By assigning relevancy scores to each offer based on what customers are most likely to buy, our Cardlytics platform can present the most relevant offers earlier in customers’ mobile and online banking sessions.
This increases the likelihood that customers activate, redeem, and earn more cash back on the things they care about most.
At the same time, marketers gain more opportunities to get valuable content in front of the right audience.
−Removed: Distributed Architecture
−Removed: A crucial aspect of our platform is our patented distributed architecture, which helps to facilitate both the effective delivery of our solutions and the protection of customer PII, which is not shared by FIs to Cardlytics.
−Removed: Our Offer Placement System ("OPS") and Offer Management System ("OMS") form the core of our advertising platform.
−Removed: Each FIs' OPS is either hosted at the FI partner’s data center behind the FI partner’s firewall or hosted by us on behalf of the FI partner.
−Removed: The OPS tracks impressions, engagement, activation and redemptions and is responsible for targeting and presenting offers, which are developed and designed within the OMS.
−Removed: The OPS interfaces with FI systems to receive anonymized purchase data, assign a unique consumer ID to each FI customer, which we call a Cardlytics ID, and aggregate this purchase data.
−Removed: The Cardlytics ID is then used to assign offers, measure redemptions, and in limited cases, validate certain online purchases via anonymously linking to a consumer’s digital media presence.
−Removed: The OMS is hosted in our data centers behind our firewall and is used to create, manage and publish marketing campaigns to each FI partner's OPS.
−Removed: OMS also provides a majority of the functionality for managing configuration settings within each OPS and the transfer of data between Cardlytics and our FI partners.
−Removed: The Cardlytics Platform
−Removed: Through our platform, marketers can deliver advertising content to FI customers in the form of an opportunity to earn rewards, which are funded with a portion of the fees we collect from marketers.
−Removed: Additionally, Cardlytics benefits FI customers by enhancing their experiences by showing them relevant advertisements tailored to their specific needs based on their specific purchase history.
−Removed: We maintain similar platforms in both the U.S.
−Removed: Cardlytics helps marketers find potential new customers that are active in their category but not currently shopping with them, or to grow their business with existing customers.
−Removed: Our marketing is targeted and measured based on actual spending information at a customer level.
−Removed: However, all reporting is aggregated across consumers in our FI network.
−Removed: Unlike many other measurement solutions on which the marketing industry has historically relied, our measurements are not probabilistic or based on models, but are based on actual in-store and online purchases.
−Removed: The breadth of our FI partners means that we are able to offer marketers the ability to optimize their marketing efforts to reach a large number of consumers through a single point of contact.
−Removed: The Cardlytics platform also provides FIs a scalable solution for driving customer loyalty and engagement whereby Cardlytics handles everything from contracting with marketers and creating, managing and reporting performance of their campaigns to attributing incentives to each FIs' customers.
−Removed: Prior to the year ended December 31, 2020, we referred to the Cardlytics platform as Cardlytics Direct.
−Removed: Other Platform Solutions
−Removed: Our Other Platform Solutions enabled marketers and marketing service providers to leverage the power of purchase intelligence outside the bank channel.
−Removed: During 2018, Other Platform Solutions revenue was $1.4 million, before shifting the majority of our efforts and resources to support the growth of the Cardlytics platform.
−Removed: We no longer generate revenue from Other Platform Solutions and do not expect to generate revenue from Other Platform Solutions for the foreseeable future.
Privacy and Security
+Added: Cardlytics Platform
We have architected privacy and security into our systems and practices.
A critical part of our strategy involves a design focused on gathering data without collecting, maintaining or using sensitive information, such as social security numbers, credit card numbers, financial account information or medical records.
−Removed: Our platform is currently designed so that we do not receive or have access to any PII from our FI partners.
−Removed: We only target marketing against anonymized data.
+Added: Our platforms are currently designed so that we do not receive or have access to any PII from our FI partners and merchant data partners.
+Added: We only target marketing against anonymized data and/or data that has undergone processing such that it is only linked to pseudonymous identifiers.
This approach to privacy is intended to protect consumers.
−Removed: Our privacy and security standards have also been designed and implemented to meet the requirements and safeguard the reputations of our FI partners and marketers, many of which are large, multinational corporations.
+Added: Our privacy and security standards have also been designed and implemented to meet the requirements of, and safeguard the reputations of our partners and marketers, many of which are large, multinational corporations.
These customers frequently audit our practices and engage in detailed assessments of our infrastructure.
−Removed: Despite the fact that we do not receive or have access to any PII from FIs, privacy and security are among our highest priorities and we commit significant resources to protecting the data that we receive.
−Removed: We have implemented, assess on an ongoing basis, and, when necessary, upgrade our physical, procedural and technical controls.
−Removed: We also take steps to impose compliance with these controls on our service providers via contract and regular audits.
+Added: Our Ad Server and Ads Manager, which have previously been referred to as our Offer Placement System and Offer Management System, respectively, form the core of the Cardlytics platform.
+Added: Each FI partners' Ad Server is either hosted at the FI partner’s data center behind the FI partner’s firewall or hosted by us on behalf of the FI partner.
+Added: The Ad Server tracks impressions, engagement, activation and redemptions and is responsible for targeting and presenting offers, which are developed and designed within the Ads Manager.
+Added: The Ad Server interfaces with our FI partners' systems to receive anonymized purchase data, assign a unique consumer ID to each FI partners' customer, which we call a Cardlytics ID, and aggregate this purchase data.
+Added: The Cardlytics ID is then used to assign offers, measure redemptions, and in limited cases, validate certain online purchases via anonymously linking to a consumer’s digital media presence.
+Added: The Ads Manager is hosted in our data centers behind our firewall and is used to create, manage and publish marketing campaigns to each FI partner's Ad Server.
+Added: The Ads Manager also provides a majority of the functionality for managing configuration settings within each Ad Server and the transfer of data between Cardlytics and our partners.
We have implemented a number of security controls.
−Removed: Our security controls have been audited and certified by third parties using standards which include SSAE 18, SQCS and SAS.
+Added: Our security environment has achieved both SOC 1 Type II and SOC 2 Type II certifications, and has been audited by third parties using standards, which include Statement on Standards for Attestation Engagements No.
+Added: 18 (SSAE 18), AICPA Auditing Standards Board-issued Statement on Quality Control Standard (SQCS) and Statements on Auditing Standards (SAS).
Sensitive data is subject to encryption, anonymization, or de-identification depending on the use case and risk profile.
2 unchanged sentences
Our privacy policy outlines the types of data we collect and how we use it.
−Removed: Most of our FI partners maintain different types of "opt-out” features for any consumer wishing to opt out of the FI rewards program on the Cardlytics platform.
+Added: Most of our FI partners maintain different types of "opt-out” features for any consumer wishing to opt out of the FI partners' rewards program on the Cardlytics platform.
Outside of the U.S., our privacy and data handling practices are subject to regulation by data protection authorities and other regulators in the countries in which we do business, which may be more restrictive than the requirements that we are subject to in the U.S.
−Removed: Acquisition of Dosh
−Removed: On March 1, 2020, we announced the entry into an Agreement and Plan of Reorganization (the “Merger Agreement”) to acquire DOSH Holdings, Inc.
−Removed: (“Dosh”), a personalized cash-back offers platform, for approximately $275.0 million, including $150.0 million in cash, subject to adjustments and escrows, and $125.0 million of our common stock at an agreed upon price of $136.33 per share.
−Removed: The acquisition will be accounted for under the acquisition method of accounting with the operations of the newly acquired entity included in our operating results from the date of acquisition.
+Added: Bridg Platform
+Added: The Bridg platform was designed to comply with privacy laws and regulations throughout the U.S.
+Added: The Bridg platform also has built-in privacy protections to ensure that data provided by clients is never sold or shared, and personal information relating to newly identified consumers is never shared with the clients.
+Added: Further, as we seek to deploy the Bridg platform outside the U.S., we will utilize best practices to ensure compliance with General Data Protection Regulation (“GDPR”) and other like data protection regimes.
Competitive Strengths
1 unchanged sentence
We believe that the following strengths provide us with competitive advantages:
−Removed: • Deeply Embedded with FIs .
−Removed: Our founders were bankers who understood the power of historical purchase data and the needs of marketers.
−Removed: Our platform was architected with our FI partners in mind and is designed to ensure that no PII ever leaves the FI or is otherwise made available to us.
−Removed: The data is anonymized so that it cannot be associated with any one individual.
−Removed: No FI partner with which we contract directly has unilaterally terminated its use of our platform.
−Removed: We are generally the exclusive provider of native bank channel advertising to our FI partners as mobile and online banking portals are typically not conducive to supporting marketing content from different vendors.
−Removed: Further, advertising within banks' digital channels requires deep technological integrations, which we believe increases the cost of switching vendors and therefore increases FI partner loyalty to us.
−Removed: • Valuable Consumer Touchpoints .
−Removed: With all of our FI partners, we enable marketers to reach consumers in a captive, largely untapped, and digitally engaging environment, when they are thinking about their finances.
−Removed: Given FI requirements, we reach real people in a secured, brand-safe environment.
+Added: • Deeply Embedded with Partners .
+Added: The Cardlytics platform was architected with our partners in mind and are designed to ensure that no PII ever leaves our FI partners' systems.
+Added: With the Cardlytics platform, the data is anonymized so that it cannot be associated with any one individual.
+Added: We are generally the exclusive provider of native bank channel digital advertising to our FI partners as their digital channels are typically not conducive to supporting marketing content from multiple vendors.
+Added: Further, advertising within FIs' digital channels requires deep technological integrations, which we believe increases the cost of switching or supporting multiple vendors and therefore increases partner loyalty to us.
+Added: • Valuable Customer Touchpoints with Customers of our FI Partners .
+Added: The Cardlytics platform enables marketers to reach consumers in a secure, brand-safe, and digitally engaging environment, when they are thinking about their finances.
We have access to consumers through both online and mobile channels and are increasingly reaching them through various other channels, including emails and real-time notifications.
• Massive Reach Informed by Purchase Intelligence .
−Removed: During 2020, our platform analyzed approximatel y $3.4 trillion in purchases across stores, retail categories, and geographies, both online and in-store.
−Removed: We have access to purchase data on our platform in the form of credit, debit, ACH and bill pay transactions.
+Added: During 2021, the Cardlytics platform analyzed approximatel y $3.8 trillion in purchases across all categories, and geographies, both online and in-store.
+Added: We have access to purchase data on the Cardlytics platform in the form of credit, debit, ACH and bill pay transactions.
We provide marketers with the opportunity to leverage this unique data set to precisely reach millions of consumers.
−Removed: • Significant Scale with Marketers and Compelling Return on Advertising Spend ("ROAS") .
−Removed: We work with marketers across a variety of industries, including retail, restaurant, travel and entertainment, telecommunications, subscription services, direct to consumer, and grocery.
+Added: The Bridg platform gives marketers the ability to leverage insight of their own POS transactional purchase data through their purchase intelligence to better understand their customers inform their marketing strategies and measure the impact of their marketing.
+Added: • Significant Scale with Marketers and Compelling Return on Advertising Spend .
+Added: We work with marketers across a variety of industries, including retail, restaurant, travel and entertainment, direct-to-consumer, and grocery and gas.
By serving these marketers at scale, we have developed deep insight into consumer behavior, which has allowed us to optimize how we reach and influence likely buyers.
• Powerful, Self-Reinforcing Network Effects .
−Removed: We see significant network effects within our platform.
−Removed: By adding new marketers and increasing the potential incentives provided to our FIs’ customers, we are able to increase engagement within our FIs’ digital banking channels.
−Removed: This, in turn, attracts more FIs to our platform, adding to our scale, and making our platform more valuable to marketers.
+Added: We see significant network effects within the Cardlytics platform.
+Added: Adding new marketers and increasing the potential incentives provided to our FI partners’ customers increases engagement within our FI partners’ digital channels.
+Added: This, in turn, attracts more FI partners to our platforms, adding to our scale, and making our platforms more valuable to marketers.
• Ability to Improve Marketing .
−Removed: Even in the global pandemic, consumers spend a vast majority of their purchase dollars in physical stores and online marketers have long sought efficient and effective ways to understand online-to-offline attribution.
−Removed: Likewise, although marketers may have access to data on the purchase behavior of their customers in their stores and on their websites, they lack visibility about these customers’ overall purchasing patterns and the purchasing behavior of other likely buyers.
−Removed: Through our proprietary purchase intelligence platform, we reach and influence real buyers at scale and measure the true, incremental impact marketers’ campaigns have on in-store and online sales.
−Removed: Our targeting capabilities allow us to tailor the campaigns on our platform to the growth strategies of marketers.
+Added: Consumers spend a vast majority of their money in physical stores, and marketers have long sought efficient and effective ways to understand online-to-offline attribution.
+Added: Likewise, although marketers may have access to data on the purchase behavior of their customers in their stores and on their websites, they lack visibility about these customers’ overall spending patterns and the purchasing behavior of other likely buyers.
+Added: Through the Cardlytics and Bridg platforms, we reach and influence real buyers at scale and measure the true, incremental impact marketers’ campaigns have on in-store and online sales.
+Added: Our targeting capabilities allow marketers to tailor their campaigns to align with their marketing strategies.
• Proprietary Technology Architecture and Advanced Analytics Capabilities .
−Removed: We have designed our platform to protect highly sensitive first-party data.
−Removed: Our proprietary, distributed architecture helps facilitate both the effective delivery of our solution and the protection of our FI customers’ PII.
−Removed: No PII is shared by the FIs with Cardlytics and the data is anonymized so that it cannot be associated with any one individual.
+Added: We have designed the Cardlytics platform to protect highly sensitive first-party data.
+Added: Our proprietary, distributed architecture helps facilitate both the effective delivery of our solution and the protection of our FI partners customers’ PII.
+Added: No PII is shared by FI partners with Cardlytics and the data is anonymized so that it cannot be associated with any one individual.
Our technologies leverage proprietary algorithms, to process raw purchase data into normalized purchase history useful for marketing and analytics.
−Removed: Our platform also supports integration of data from third-party sources to enrich the intelligence that we are able to provide.
+Added: Our Cardlytics platform also supports integration of data from third-party sources to enrich the intelligence that we provide.
Further, we apply advanced analytics to continuously increase our intelligence capabilities and identify actionable behavior patterns for our marketers.
1 unchanged sentence
We use sophisticated quantitative methods to quickly access our massive volumes of data and make sense of what has happened—and, importantly, what is likely to happen.
−Removed: Our analytics makes our data actionable, enabling us to develop insights that marketers and FIs rely on to make more informed business decisions and more meaningful customer connections.
+Added: Our analytics makes our data actionable, enabling us to develop insights that marketers and partners rely on to make more informed business decisions and more meaningful customer connections.
+Added: • Loyalty Tactics Beyond Loyalty Programs .
+Added: The Bridg platform easily integrates with the majority of POS systems, allowing marketers to identify and reach previously unreachable customers.
+Added: This allows marketers to utilize loyalty tactics across all of their customers and enjoy the same rich insights, targeted marketing capabilities, and closed loop measurement as digital brands.
• World-Class Management Team with Unique Combination of Backgrounds and Experiences .
−Removed: Our team’s extensive experience across banking, technology and marketing is invaluable in our ability to forge relationships with financial and marketing partners, and understand the technical complexities inherent in building a platform that is transforming and disrupting the marketing industry.
+Added: Our team’s extensive experience across banking, technology and marketing is invaluable in our ability to forge relationships with financial and marketing partners and understand the technical complexities inherent in building platforms that are transforming and disrupting the marketing industry.
Growth Strategies
1 unchanged sentence
• Grow our Business with Marketers .
−Removed: While we already work with many large marketers, our platform currently captures only a small portion of their overall marketing spend.
−Removed: We intend to continue to expand our sales and marketing efforts to grow our share of advertising budgets from existing marketers and attract new brands, retailers and service providers.
−Removed: We also intend to grow our business with new marketers in new industry verticals such as travel and entertainment, direct to consumer, and grocery.
−Removed: We plan to increase sales to marketers through advertising agencies by leveraging our platform’s new self-service capabilities.
+Added: While we already work with many large marketers, our platforms currently capture only a small portion of their overall marketing spend.
+Added: We intend to continue expanding our sales and marketing efforts to grow our share of advertising budgets from existing marketers and attract new brands, merchants and service providers.
+Added: We also intend to grow our business with new marketers in newer industry verticals such as travel and entertainment, direct to consumer, and grocery and gas.
+Added: We plan to increase sales to marketers through advertising agencies by leveraging the Cardlytics platform’s emerging self-service capabilities.
+Added: We also intend to continue growing the footprint of the Bridg platform through both new and existing merchant data partners.
+Added: • Continue to Innovate and Evolve our Platforms .
+Added: As we continue to grow our data assets and enhance our Cardlytics platform through the option of self-service, we are also developing new solutions, greater automation and increasingly sophisticated analytical capabilities.
+Added: Our innovation is also focused on evolving our offer formats and expanding the types of offers within the Cardlytics platform, including product-level offers sourced from Bridg’s merchant data partners that can be distributed and managed within the Cardlytics platform.
+Added: As we have in the past, we plan to continue to work in close collaboration with our partners to develop new purchase intelligence-based analytic solutions to enable marketers to make more informed business decisions.
+Added: • Continue to Realize Synergies between the Cardlytics and Bridg Platforms.
+Added: The acquisition of Bridg allows for synergies with the current Cardlytics platform by creating more relevant offers, and more targeted segments, that can drive higher redemptions, increase consumer engagement, and generate greater advertiser demand.
+Added: We believe integrating the Cardlytics and Bridg platforms has the potential to enable more effective media measurement (power promotional effectiveness across in-store and online channels), price and promotion optimization, more optimal partner relationships and further international expansion.
+Added: The Bridg platform uses POS data from retailers to generate new opportunities that can also be used by our current FI partners to better target their financial product marketing.
+Added: We expect this will allow us to continue to expand our marketing partners.
• Drive Growth through Existing FI Partners .
−Removed: We intend to drive revenue growth by continuing to increase customer adoption by improving the effectiveness of FIs’ digital channels.
−Removed: The amount of revenue that we generate from the incentive programs of each of our FI partners varies.
−Removed: This variance is typically a result of how long the program has been active, the user interface for the program and the FI’s efforts to promote the program.
−Removed: We continually work with FIs to improve their customers’ user experience, increase customer awareness and leverage additional customer outreach channels like email.
−Removed: • Expand the Network of FI Partners .
−Removed: We will continue to focus on growing our network of FI partners by integrating directly with large national and regional banks and by opportunistically reselling our solution through financial processors and payment networks.
−Removed: Each new FI partner increases the size of our data asset, increasing the value of our platform to both marketers and FIs that are already part of our FI network.
−Removed: • Continue to Innovate and Evolve our Platform .
−Removed: As we continue to grow our data asset and enhance our platform through the option of self-service, we are developing new solutions, greater automation and increasingly sophisticated analytical capabilities.
−Removed: Our platform’s new self-service capabilities will provide existing and new marketers with the ability to build their own campaigns directly on our platform and enhance their experience with our product.
−Removed: As we have in the past, we plan to continue to work in close collaboration with our FI partners to develop new purchase intelligence-based analytic solutions to enable marketers to make more informed business decisions.
+Added: We intend to drive revenue growth by continuing to increase customer adoption by improving the effectiveness of our FI partners’ digital channels.
+Added: We continually work with our FI partners to improve their customers’ user experience, increase customer awareness and leverage additional customer outreach channels like email and alerts
+Added: • Expand the Network of Partners .
+Added: We will continue to focus on growing our network of partners by integrating directly with FI partners, non-bank partners, merchant data partners and by opportunistically reselling our solution through financial processors and payment networks.
+Added: Each new partner increases the size of our data asset, increasing the value of the Cardlytics and Bridg platforms to both marketers and our existing partners.
• Grow the Platform Through Integrations with Partners .
−Removed: We intend to continue to partner with other media platforms, marketing technology providers and agencies that can utilize our platform to serve a broad array of customers.
−Removed: To facilitate these partnerships, we intend to focus on continued technological integration of our platform with those of complementary market participants.
−Removed: We define an FI partner as a separate contracting entity from which we access purchase data to empower our platform either directly or through a third-party intermediary, such as a bank processor, digital banking provider or payment network operator.
−Removed: We generally pay our FI partners an FI Share, which is a negotiated and fixed percentage of our billings to marketers less any Consumer Incentives that we pay to the FIs’ customers and certain third-party data costs.
−Removed: As of December 31, 2020, we had direct contractual relationships with 20 of our FI partners.
−Removed: From inception to date, no FI partner with which we contract directly has unilaterally terminated its use of our solution.
+Added: We intend to continue to partner with other media platforms, marketing technology providers, merchant data providers and agencies that can utilize our platforms to serve a broad array of customers.
+Added: In addition to focusing on the integration of the Cardlytics and Bridg platforms, we intend to focus on continued technological integration of our platforms with those of other complementary market participants.
+Added: We define a partner as a separate contracting entity from which we access purchase data to empower our platforms either directly or through a third-party intermediary, such as a bank processor, digital banking provider or payment network operator.
+Added: The partners for the Cardlytics platform are predominantly FI partners that provide us with access to their anonymized purchase data and digital banking customers.
+Added: We generally pay our partners on the Cardlytics platform a Partner Share, which is a negotiated and fixed percentage of our billings to marketers less any Consumer Incentives that we pay to the partners’ customers and certain third-party data.
FI partners that become part of our network through bank processors and digital banking providers may terminate their relationships with these bank processors and digital banking providers and thereby indirectly terminate their relationships with us.
+Added: Our agreements with our FI partners generally include an automatic renewal feature.
+Added: The partners for the Bridg platform are merchant data partners that provide us with access to their POS data, including product-level purchase data.
Agreements with Bank of America
Since November 2010, our relationship with Bank of America has been governed by a General Services Agreement ("GSA") pursuant to which we provide Bank of America with access to the Cardlytics platform and certain other related services, and a related Software License, Customization and Maintenance Agreement, which grants Bank of America the right to use the software underlying the Cardlytics platform.
−Removed: The GSA terminates in December 2021 and may be extended by Bank of America for additional one-year periods.
+Added: The GSA has been extended through August 31, 2022 and, if not extended again, will automatically renew for one-month periods thereafter unless terminated earlier in accordance with the terms of the GSA.
Pursuant to the GSA with Bank of America, we provide the Cardlytics platform to Bank of America customers which includes forming relationships with participating marketers;
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and monitoring redemption rates with respect to Consumer Incentives offered in Cardlytics campaigns.
−Removed: Although we are primarily responsible for securing marketers to advertise on our platform, Bank of America may likewise secure marketers and has the right to approve all marketer offers to be presented to Bank of America customers on the Cardlytics platform.
+Added: Although we are primarily responsible for securing marketers to advertise on the Cardlytics platform, Bank of America may likewise secure marketers and share a portion of billings with us.
+Added: Bank of America has the right to approve all marketer offers to be presented to Bank of America customers on the Cardlytics platform.
Under the GSA, we share the revenue that we generate from the sale of advertising within the Bank of America channel with Bank of America, subject to certain exceptions.
−Removed: The amounts that we pay to Bank of America are reflected as FI Share.
−Removed: The specific FI Share percentage that we pay is based on whether we or Bank of America have secured the relevant marketer account and other marketer- and transaction-specific factors, provided that we are entitled to retain a minimum percentage of the monthly revenue subject to the GSA.
−Removed: In connection with entering into certain supplements to the GSA and the related license agreement, in March 2011 we granted to an affiliate of Bank of America a 10-year warrant to purchase up to (i) 78,100 shares of our common stock at an exercise prices of $2.52 per share and (ii) 312,401 shares of our common stock at an exercise price of $6.52 per share.
−Removed: These warrants were net exercised in February 2018, resulting in the issuance of 263,518 shares of our common stock.
+Added: The amounts that we pay to Bank of America are reflected as Partner Share.
+Added: The specific Partner Share percentage that we pay is based on whether we or Bank of America have secured the relevant marketer account and other marketer- and transaction-specific factors, provided that we are entitled to retain a minimum percentage of the monthly revenue subject to the GSA.
Agreements with Chase
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Chase may terminate the Master Agreement at any time upon 90 days’ written notice.
+Added: The GSA will automatically renew for 12-month periods thereafter, unless terminated earlier in accordance with the terms of the GSA.
Under the Master Agreement, we share billings that we generate from the sale of advertising within the Chase channel with Chase, subject to certain exceptions.
−Removed: The amounts that we pay to Chase in excess of Consumer Incentives are reflected as FI Share.
+Added: The amounts that we pay to Chase in excess of Consumer Incentives are reflected as Partner Share.
The specific billing share percentage that we pay is based on whether we or Chase have secured the relevant marketer account and other marketer- and transaction-specific factors, provided that we are entitled to retain a minimum percentage of the monthly revenue subject to the Master Agreement.
−Removed: We enable marketers and their agencies to efficiently and effectively market to our FIs’ customers through the Cardlytics platform.
−Removed: We work with companies across a variety of industries, including retail, restaurant, travel and entertainment, telecommunications, subscription services, direct to consumer, and grocery.
−Removed: During 2018, 2019 and 2020, our top five marketers accounted for 23%, 27% and 35% of our revenue.
−Removed: No marketer represented a significant concentration of our accounts receivable as of December 31, 2018.
−Removed: As of December 31, 2019 and December 31, 2020 our top five marketers accounted for 26% and 31% of our accounts receivable, respectively, with one marketer representing over 10% as of December 31, 2019 and December 31, 2020, respectively.
+Added: We work with marketers across a variety of industries, including retail, restaurant, travel and entertainment, direct-to-consumer, and grocery and gas.
+Added: During 2019, 2020 and 2021, our top five marketers accounted for 27%, 35% and 29% of our revenue, respectively, with one marketer accounting for over 10% during each period.
+Added: As of December 31, 2020 and 2021, our top five marketers accounted for 31% and 19% of our accounts receivable, respectively, with one marketer representing over 10% in 2020 and no marketers representing over 10% in 2021.
Sales and Marketing
−Removed: Our sales teams are focused on growth with our marketer and agency customers and our marketing efforts are focused on increasing market awareness for Cardlytics through partnerships, public relations, industry events and publications.
−Removed: Our FI-focused account management team is focused on deepening relationships with existing FI partners and expanding our FI network.
−Removed: During 2018, 2019 and 2020, our total sales and marketing expenses were $41.9 million, $43.8 million and $45.3 million, respectively, representing approximately 28%, 21% and 24% of revenue, respectively.
+Added: Our sales teams are focused on growth with our marketer and agency customers and our marketing efforts are focused on increasing market awareness for Cardlytics and Bridg through partnerships, public relations, industry events and publications.
+Added: Our partner-focused account management team is focused on deepening relationships with existing partners and expanding our network.
We have dedicated sales teams responsible for establishing relationships with marketers and their agencies.
−Removed: Our sales teams are organized by industry, which include retail, restaurant, travel and entertainment, telecommunications, subscription services, direct to consumer, and grocery.
+Added: Our sales teams are organized by industry, which include retail, restaurant, travel and entertainment, direct-to-consumer, and grocery and gas.
Each industry team is led by an experienced sales manager and staffed with sales, sales support and service specialists who have deep domain knowledge and industry operating experience.
We also have account managers that manage our customer relationships within each industry.
−Removed: Financial Institution Partners
−Removed: Our efforts to expand our FI network are focused on both nurturing our existing banking relationships and cultivating new relationships.
−Removed: Our FI partner sales team is focused on driving FIs to enhance their user interface for our platform, otherwise drive increased consumer engagement and encourage adoption of our solution offerings.
−Removed: The market for the utilization of purchase intelligence is nascent and we believe we are one of the only companies that can provide purchase intelligence with the scale and the level of granularity that is equivalent to ours.
−Removed: We believe that we are the only company that enables marketing through FI channels at scale.
−Removed: In the future, we may face greater competition from online retailers, credit card companies, digital publishers and mobile pay providers with access to a substantial amount of consumer purchase data.
+Added: We have a dedicated sales team focused on expanding our network of FI partners by both nurturing our existing banking relationships and cultivating new relationships.
+Added: Our FI partner sales team is focused on driving FIs to enhance their user interface for the Cardlytics platform, otherwise drive increased consumer engagement and encourage adoption of our solution offerings.
+Added: The market for utilizing purchase intelligence to power marketing decisions is still emerging, and we believe we are one of the only companies that can provide purchase intelligence with the scale and the level of granularity that is equivalent to ours.
+Added: We believe that we are the only company with scale that leverages purchase data to enable marketing through FI partner channels at scale, although we believe we currently have competition from other companies that deliver similar solutions on a smaller scale.
+Added: In the future, we may face greater competition from other bank service providers, online retailers, credit card companies, digital publishers and mobile pay providers with access to a substantial amount of consumer purchase data.
+Added: There also may be companies with access to FI data that do not enable marketing through FI partner channels at scale today that may be able to do so in the future.
While we may successfully partner with a wide range of companies that are, to some extent, currently competitive to us, these companies may become more competitive to us in the future.
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• ability to leverage purchase data to inform marketing;
−Removed: • depth and breadth of relationships with FIs, marketers and their agencies;
+Added: • depth and breadth of relationships with partners, marketers and their agencies;
• depth and breadth of, and access to, purchase data;
−Removed: • effectiveness in increasing return on advertising spend ("ROAS") for marketers;
+Added: • effectiveness in increasing return on advertising spend for marketers;
• effectiveness in increasing marketing campaign performance for marketers and their agencies;
−Removed: • effectiveness in increasing FI customer engagement;
−Removed: • ability to maintain confidentiality and security of FI transaction data;
+Added: • effectiveness in increasing partner customer engagement;
+Added: • ability to maintain confidentiality and security of partner transaction data;
• transparency into and measurement of marketing performance;
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• ability to continue to innovate;
−Removed: • ability to attract, retain and develop leading-edge analytical and technical talent.
+Added: • ability to attract, retain and develop leading-edge sales, account management, analytical and technical talent.
We believe that we compete favorably with respect to these factors and that we are well positioned as a leading provider and innovator of purchase intelligence.
+Added: The Bridg platform competes with other companies that operate enterprise customer data platforms.
+Added: Additionally, Bridg competes or may in the future compete against monoline companies that provide advertising and data solutions such as profile unification or marketing campaign management and analytics, as well as data provisioners, brokers and cooperatives that provide advertising analytics to clients.
Intellectual Property
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and other jurisdictions.
−Removed: As of December 31, 2020, we had four issued patents and are pursuing ten additional patents relating to our software.
−Removed: Our issued patents relate to a distributed system for inserting offers into online banking and expire in October 2028.
−Removed: We cannot assure you that any patents will issue from any patent applications, that patents that issue from such applications will give us the protection that we seek or that any such patents will not be challenged, invalidated, or circumvented.
−Removed: Any patents that may issue in the future from our pending or future patent applications may not provide sufficiently broad protection and may not be enforceable in actions against alleged infringers.
−Removed: We have registered the “Cardlytics” name and logo in the U.S.
+Added: As of December 31, 2021, we had seven issued patents relating to our software.
+Added: We cannot assure you that our patents will give us the protection that we seek or that any such patents will not be challenged, invalidated, or circumvented.
+Added: Our patents may not provide sufficiently broad protection and may not be enforceable in actions against alleged infringers.
+Added: We have registered, or are registering, the "Cardlytics," "Dosh," and "Bridg," names and logos in the U.S.
and certain other countries.
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We cannot assure you that such third parties will maintain such software or continue to make it available.
−Removed: We are the registered holder of a variety of domestic and international domain names that include cardlytics.com and similar variations on that name.
+Added: We are the registered holder of a variety of domestic and international domain names that include cardlytics.com, dosh.com, bridg.com, entertainment.com and similar variations on those names.
In order to protect our unpatented proprietary technologies and processes, we rely on trade secret laws and confidentiality agreements with our employees, consultants, financial institution partners, marketers, vendors and others.
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If we become more successful, we believe that competitors will be more likely to try to develop solutions and services that are similar to ours and that may infringe our proprietary rights.
−Removed: It may also be more likely that competitors or other third parties will claim that our platform infringes their proprietary rights.
+Added: It may also be more likely that competitors or other third parties will claim that our platforms infringes their proprietary rights.
Patent and other intellectual property disputes are common in our industry and we have been involved in such disputes from time to time in the ordinary course of our business.
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Third parties may in the future assert claims of infringement, misappropriation or other violations of intellectual property rights against us.
−Removed: They may also assert such claims against our FI partners, which we typically indemnify against such claims.
+Added: They may also assert such claims against our partners, which we typically indemnify against such claims.
As the numbers of products and competitors in our market increase and overlaps occur, claims of infringement, misappropriation and other violations of intellectual property rights may increase.
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Human Capital Resources and Management
−Removed: We are focused on building a revolutionary company, and we know this starts with investing in each of our employees.
+Added: Our company's mission is to redefine marketing by using data for good, and we know this starts with investing in each of our employees.
Headquartered in Atlanta, GA with additional offices in New York, NY;
San Francisco, CA;
−Removed: and Visakhapatnam, India, our employees are a big part of what drives our exceptional desire to win and help our advertisers and FI partners win.
+Added: Los Angeles, CA;
+Added: Charlotte, NC;
+Added: and Visakhapatnam, India, our employees are a big part of what drives our exceptional desire to win and help our advertisers and partners win.
Diversity, Equity, and Inclusion (“DEI”) is integrated in everything we do.
−Removed: This mindset starts at the top.
+Added: This mindset starts at the top, a significant part of our company goal of creating a “Great place where great people want to be”.
Our CEO and other senior leaders have DEI objectives in their performance goals.
This focus is embedded in each aspect of the talent lifecycle:
−Removed: attraction, recruitment, onboarding, development and retention efforts.
+Added: attraction, recruitment, onboarding, development and retention.
We build external relationships to ensure our talent pipelines are filled with candidates of diverse backgrounds.
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Each group is sponsored by senior leaders in the organization.
−Removed: Cardlytics Connect, our newest SIG, focuses on our black employees across the globe and has a focused curriculum led by senior leaders.
−Removed: As of December 31, 2020, approximately 39% of our global workforce is made up of women and 40% people of color.
+Added: Cardlytics Connect, our newest SIG, focuses on our Black employees across the globe and is also expanding to focus on our Hispanic employees.
+Added: As of December 31, 2020 and 2021, approximately 39% and 38% of our global workforce is made up of women, respectively, and 40% and 48% is made up of people of color, respectively.
A key component to our sustainability and success is learning and development.
We are intentional in our efforts to provide all employees opportunities to grow.
−Removed: Cardlytics University is a resource for both new hires as well as longer tenured employees, and we have specialized curriculum for emerging leaders, managers and mentors.
−Removed: Our use of equity compensation allows all employees to operate as owners and is a key component of our total rewards strategy to retain, motivate and attract the best talent.
−Removed: All employees are shareholders and are invested, figuratively and literally, in our success.
+Added: Additionally, we have introduced programs for student loan assistance and tuition reimbursement beginning in 2022.
+Added: Cardlytics University is a resource for both new hires as well as longer-tenured employees, and we have specialized curricula for emerging leaders, managers and mentors.
+Added: Our use of equity compensation allows our employees to operate as owners and is a key component of our total rewards strategy to retain, motivate and attract the best talent.
+Added: We encourage our employees to think and act like shareholders, and they are invested in our success.
Employee equity is the cornerstone in our compensation philosophy along with comprehensive medical benefits, a positive work/life ratio, unlimited paid time off, health and wellness programs, and learning and development opportunities.
Each year, with the help of outside experts, we evaluate each aspect of compensation and benefits to ensure they are in alignment with the market and our peers.
−Removed: Our values reflect what drives our success.
+Added: As a purpose-driven company, we are focused on creating undeniable impact for partners while delivering real value to people, and our values reflect what drives our success.
Our people and culture are our most valuable assets and greatest differentiators.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.