forge-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-04321

Forge Global Holdings, Inc.

(Exact name of registrant as specified in its charter)


Delaware									98-1561111
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

4 Embarcadero Center Floor 15 San Francisco, CA 94111
(Address of principal executive offices, including zip code)

(415) 881-1612

(Registrant's telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.0001 per share	FRGE	The New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	x	Smaller reporting company	x
		Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

As of May 7, 2024, the registrant had 181,040,289 shares of common stock, $0.0001 par value per share, outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Unless the context otherwise requires, references in this Quarterly Report on Form 10-Q (this "Report") to “Forge,” the “Company,” “us,” “we,” “our,” and any related terms are intended to mean Forge Global Holdings, Inc. and its consolidated subsidiaries.

Certain statements in this Report may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions, or strategies regarding the future. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Report may include, for example, statements about our ability to:

•effectively respond to general macroeconomic and business conditions;

•execute our business strategy, including monetization of services provided;

•anticipate the uncertainties inherent in the development of new business lines, strategies, products, and services;

•anticipate rapid technological changes;

•respond to uncertainties associated with product and service development and market acceptance;

•increase brand awareness;

•attract, train, and retain effective officers, employees, directors, and other key personnel;

•acquire, develop, and protect intellectual property;

•maintain key strategic relationships with partners;

•anticipate the significance and timing of contractual obligations;

•enhance future operating and financial results;

•respond to fluctuations in interest rates and foreign currency exchange rates;

•finance operations on an economically viable basis;

•meet future capital adequacy and liquidity requirements;

•obtain additional capital, including use of the debt market;

•comply with laws and regulations applicable to our business;

•stay abreast of modified or new laws and regulations that would apply to our business;

•manage cyber and technology risk management processes, including incident management processes;

•upgrade and maintain information technology systems;

•maintain disaster recovery and business continuity planning controls;

•manage vendor and third party processes;

•access, collect, and use personal information and other data about consumers;

•maintain the listing of our securities on the NYSE or another national securities exchange;

•anticipate the impact of, and response to, new accounting standards;

•anticipate the impact of new tax laws that would apply to our business; and

•successfully defend litigation.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Report.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Report primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors, including those described in the section titled “Risk Factors” and elsewhere in this Report. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and

uncertainties that could have an impact on the forward-looking statements contained in this Report. We cannot assure you that the results, events, and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

Neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Moreover, the forward-looking statements made in this Report relate only to events as of the date on which the statements are made. We undertake no obligation to update any after the date of this Report or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, partnerships, mergers, dispositions, joint ventures, or investments we may make.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

Table of Contents


		Page
Part I - Financial Information
	Item 1. Condensed Consolidated Financial Statements (Unaudited)	5
	Notes to Condensed Consolidated Financial Statements (Unaudited)	11
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
	Item 3. Quantitative and Qualitative Disclosures About Market Risk	40
	Item 4. Controls and Procedures	40

Part II - Other Information
	Item 1. Legal Proceedings	41
	Item 1A. Risk Factors	41
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	41
	Item 3. Defaults Upon Senior Securities	41
	Item 4. Mine Safety Disclosures	42
	Item 5. Other Information	42
	Item 6. Exhibits	42

	Signatures	43

Table of Contents

Part I - Financial Information

FORGE GLOBAL HOLDINGS, INC.

Unaudited Condensed Consolidated Balance Sheets

(In thousands of U.S. dollars, except share and per share data)


	March 31, 2024		December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	129,606	$	144,722
Restricted cash	1,075		1,062
Accounts receivable, net	5,553		4,067

Prepaid expenses and other current assets	12,418		13,253
Total current assets	$	148,652	$	163,104
Internal-use software, property and equipment, net	4,540		5,192
Goodwill and other intangible assets, net	128,940		129,919
Operating lease right-of-use assets	7,985		4,308
Payment-dependent notes receivable, noncurrent	6,236		5,593
Other assets, noncurrent	2,324		2,615
Total assets	$	298,677	$	310,731
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	2,671	$	1,831
Accrued compensation and benefits	7,037		11,004
Accrued expenses and other current liabilities	11,507		8,861
Operating lease liabilities, current	2,922		2,516

Total current liabilities	24,137		24,212
Operating lease liabilities, noncurrent	6,253		2,707
Payment-dependent notes payable, noncurrent	6,236		5,593
Warrant liabilities	5,169		9,616
Other liabilities, noncurrent	285		185
Total liabilities	42,080		42,313
Commitments and contingencies (Note 8)
Stockholders’ equity:
Common stock, $0.0001 par value; 180,011,227 and 176,899,814 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively	18		18
Treasury stock, at cost; 157,193 shares as of March 31, 2024 and December 31, 2023, respectively	(625)		(625)
Additional paid-in capital	551,274		543,846
Accumulated other comprehensive income	765		911
Accumulated deficit	(299,262)		(280,638)
Total Forge Global Holdings, Inc. stockholders’ equity	252,170		263,512
Noncontrolling Interest	4,427		4,906
Total stockholders’ equity	256,597		268,418
Total liabilities and stockholders’ equity	$	298,677	$	310,731

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

FORGE GLOBAL HOLDINGS, INC.

Unaudited Condensed Consolidated Statements of Operations

(In thousands of U.S. dollars, except share and per share data)


	Three Months Ended March 31,
	2024		2023
Revenues:
Marketplace revenues	$	8,520	$	4,632
Custodial administration fees	10,722		10,847
Total revenues	19,242		15,479
Transaction-based expenses:
Transaction-based expenses	(29)		(19)
Total revenues, less transaction-based expenses	19,213		15,460
Operating expenses:
Compensation and benefits	29,843		25,762
Technology and communications	3,060		3,390
Professional services	2,217		2,736
Advertising and market development	1,090		677
Rent and occupancy	1,135		1,326
General and administrative	5,062		2,748
Depreciation and amortization	1,816		1,789
Total operating expenses	44,223		38,428
Operating loss	(25,010)		(22,968)
Interest and other income (expense):
Interest income	1,709		1,509
Change in fair value of warrant liabilities	4,447		168
Other income, net	76		215
Total interest and other income (expense)	6,232		1,892
Loss before provision for income taxes	(18,778)		(21,076)
Provision for income taxes	216		185
Net loss	(18,994)		(21,261)
Net loss attributable to noncontrolling interest	(370)		(73)
Net loss attributable to Forge Global Holdings, Inc.	$	(18,624)	$	(21,188)
Net loss per share attributable to Forge Global Holdings, Inc. common stockholders:
Basic	$	(0.10)	$	(0.12)
Diluted	$	(0.10)	$	(0.12)
Weighted-average shares used in computing net loss per share attributable to Forge Global Holdings, Inc. common stockholders:
Basic	179,910,522		171,816,522
Diluted	179,910,522		171,816,522

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

FORGE GLOBAL HOLDINGS, INC.

Unaudited Condensed Consolidated Statements of Comprehensive Loss

(In thousands of U.S. dollars)


	Three Months Ended March 31,
	2024		2023
Net loss	$	(18,994)	$	(21,261)
Foreign currency translation adjustment	(255)		228
Comprehensive loss	(19,249)		(21,033)
Less: Comprehensive (loss) income attributable to noncontrolling interest	(479)		18
Comprehensive loss attributable to Forge Global Holdings, Inc.	$	(18,770)	$	(21,051)

Table of Contents

FORGE GLOBAL HOLDINGS, INC.

Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit)

(In thousands of U.S. dollars, except share data)

Common Stock

Additional Paid-In Capital

Accumulated Deficit

Accumulate

SEC Form 10-Q filed by Forge Global Holdings Inc.