sklz-20210331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended March 31, 2021


☐			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: 001-39243

SKILLZ INC.

(Exact name of registrant as specified in its charter)

Delaware

46-2682070

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

PO Box 445

San Francisco, California

94104

(Address of Principal Executive Offices)

(Zip Code)

(415) 762-0511

Registrant's telephone number, including area code

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	SKLZ	New York Stock Exchange
Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share	SKLZ.WS	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 ☒ No ☐

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 such files).

Yes ☒ No ☐

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	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☐
		Emerging growth company	☒

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 ☐ No ☒

As of May 5, 2021, the registrant had outstanding 326,901,690 shares of Class A common stock and 69,587,138 shares of Class B common stock.


			Page

Note Regarding Forward Looking Statements

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)			1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3. Quantitative and Qualitative Disclosures About Market Risk			30
Item 4. Controls and Procedures			30

PART II - OTHER INFORMATION

Item 1. Legal Proceedings			31
Item 1A. Risk Factors			31
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			32
Item 3. Defaults Upon Senior Securities			32
Item 4. Mine Safety Disclosures			32
Item 5. Other Information			32
Item 6. Exhibits			33
Signatures			34


	March 31,		December 31,
	2021		2020
Assets
Current assets:
Cash and cash equivalents	$	612,578	$	262,728
Warrant exercise receivable	104,558		—
Prepaid expenses and other current assets	14,981		10,491
Total current assets	732,117		273,219
Property and equipment, net	5,398		5,292
Other long-term assets	3,908		3,910
Total assets	$	741,423	$	282,421
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	9,513	$	22,039
Accrued professional fees	725		5,699
Other current liabilities	29,860		19,618
Total current liabilities	40,098		47,356

Common stock warrant liabilities	112,378		178,232
Other long-term liabilities	36		46
Total liabilities	152,512		225,634
Commitments and contingencies (Note 5)
Stockholders’ equity:
Preferred stock $0.0001 par value; 10 million shares authorized — 0 issued and outstanding as of March 31, 2021 and December 31, 2020	—		—
Common stock $0.0001 par value; 625 million shares authorized; Class A common stock – 500 million shares authorized; 326 million and 292 million shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively; Class B common stock – 125 million shares authorized; 70 million and 78 million shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	39		37
Additional paid-in capital	880,779		295,065
Accumulated deficit	(291,907)		(238,315)
Total stockholders’ equity	588,911		56,787
Total liabilities and stockholders’ equity	$	741,423	$	282,421


	Three Months Ended March 31,
	2021		2020
Revenue	$	83,677	$	43,559
Costs and expenses:
Cost of revenue	4,256		2,767
Research and development	7,282		4,366
Sales and marketing	96,323		46,825
General and administrative	27,284		4,833
Total costs and expenses	135,145		58,791
Loss from operations	(51,468)		(15,232)
Interest expense, net	(24)		(316)
Change in fair value of common stock warrant liabilities	(2,108)		—
Other income, net	50		51
Loss before income taxes	(53,550)		(15,497)
Provision for income taxes	42		25
Net loss	$	(53,592)	$	(15,522)
Net loss per share attributable to common stockholders – basic	$	(0.15)	$	(0.06)
Weighted average common shares outstanding – basic	356,818,954		278,348,903
Net loss attributable to common stockholders – diluted	$	(57,391)	$	(15,522)
Net loss per share attributable to common stockholders – diluted	$	(0.16)	$	(0.06)
Weighted average common shares outstanding – diluted	359,827,649		278,348,903


	Redeemable convertible preferred stock			Preferred stock			Common stock			Additional paid-in capital		Accumulated deficit		Total stockholders’ equity (deficit)
	Shares	Amount		Shares	Amount		Shares	Amount
Balance at December 31, 2019	—	$	—	—	$	—	286,074,923	$	29	$	108,892	$	(90,256)	$	18,665
Issuance of common stock upon exercise of stock options	—	—		—	—		829,348	—		241		—		241
Stock-based compensation	—	—		—	—		—	—		357		—		357
Net loss	—	—		—	—		—	—		—		(15,522)		(15,522)
Balance at March 31, 2020	—	$	—	—	$	—	286,904,271	$	29	$	109,490	$	(105,778)	$	3,741

Balance at December 31, 2020	—	$	—	—	$	—	369,797,524	$	37	$	295,065	$	(238,315)	$	56,787
Issuance of common stock upon exercise of stock options	—	—		—	—		268,426	—		12		—		12
Issuance of common stock upon exercise of warrants and other, net	—	—		—	—		8,741,863	—		172,519		—		172,519
Net cash contributions from follow-on offering	—	—		—	—		17,000,000	2		402,238		—		402,240
Stock-based compensation	—	—		—	—		—	—		10,945		—		10,945
Net loss	—	—		—	—		—	—		—		(53,592)		(53,592)
Balance at March 31, 2021	—	$	—	—	$	—	395,807,813	$	39	$	880,779	$	(291,907)	$	588,911


	March 31,		December 31,
	2021		2020
Capitalized internal-use software	$	6,568	$	6,167
Computer equipment and servers	707		631
Furniture and fixtures	184		184
Leasehold improvements	114		114
Construction in progress	1,219		1,037
Total property and equipment	8,792		8,133
Accumulated depreciation and amortization	(3,394)		(2,841)
Property and equipment, net	$	5,398	$	5,292

SEC Form 10-Q filed by Skillz Inc.