Clear Secure(YOU) - 2022 Q4 - Annual Report

Membership Growth and Retention - Total Cumulative Enrollments increased 97.4% year-over-year to 10.4 million, with Annual CLEAR Plus Net Member Retention rising to 92.3% from 78.8% in 2020[24] - CLEAR has over 15 million members, many of whom are frequent travelers and active consumers, benefiting partners through accelerated adoption rates[47] - The company added approximately 5 million members in 2022, achieving a Lifetime Value to Customer Acquisition Cost ratio of approximately 22 times for members who joined during 2022[55][54] - CLEAR Plus member acquisition channel in airports represented 66%, 58%, and 69% of member acquisitions for the years ended December 31, 2022, 2021, and 2020 respectively[61] - The CLEAR Plus member retention rates are estimated using annual cohorts from 2022[54] Financial Performance - Total Bookings rose 61.6% year-over-year, from $236.0 million to $341.0 million, while total revenue increased 10.0% from $231.0 million in 2020 to $254.0 million in 2021[24] - The company had cash and cash equivalents of $68.9 million as of December 31, 2022[390] - The company held marketable securities totaling $666 million, primarily invested in government securities and corporate notes as of December 31, 2022[392] - A hypothetical 100 basis points increase or decrease in interest rates would result in an unrealized loss or gain of approximately $3.3 million on the fair value of marketable securities[392] Business Model and Strategy - The platform's business model is characterized by efficient member acquisition and high retention rates, with a strong focus on network effects[26] - The company aims to expand CLEAR Plus through airport network expansion and increased market penetration in existing markets[30] - The company plans to launch a TSA PreCheck® enrollment program, which is expected to drive significant growth and revenue opportunities[67] - The company has expanded its partnerships and distribution channels, targeting new airlines, credit card partners, and professional sports leagues[67] Security and Compliance - CLEAR's information security program has been certified at a FISMA High Rating, ensuring high standards of data protection and privacy[36] - The company operates under strict privacy and data security requirements as a HIPAA "business associate" for certain health care partners[74] - The company is subject to significant penalties for non-compliance with data protection laws, which could adversely affect its business[74][76] - The company is subject to various regulatory regimes as it expands internationally, including compliance with the California Privacy Rights Act and the General Data Protection Regulation[74][76] Workforce and Culture - The company has a workforce of 3,056 full-time employees as of December 31, 2022, with significant presence in New York, Los Angeles, and Atlanta[71] - The company emphasizes a culture of ownership and problem-solving among its team members[11] - The company is committed to continuously improving member experience based on feedback[11] - The company has a bias for action, encouraging data-driven decision-making[11] International Expansion - The company aims for international expansion, having already provided services in several countries including Argentina, Brazil, and Spain through its acquisition of Whyline, Inc.[67] - The company has expanded its services to international markets including Argentina, Brazil, and Spain through the acquisition of Whyline, Inc.[75] Capital Structure and IPO Preparation - The company has undergone a reorganization to optimize its capital structure in preparation for its IPO[80] - As of December 31, 2022, the company had no outstanding borrowings under the revolving credit facility[391] - The company operates with a net invested capital of approximately $50 million while maintaining high retention rates and efficient member acquisition[61] Market Presence - As of December 31, 2022, members can access a nationwide network of 48 airports covering 132 lanes and 16 sports and entertainment partners[41] - As of December 31, 2022, approximately 6% of all TSA checkpoint volume went through a CLEAR lane, compared to approximately 4% in December 2021[67] - The company has 47 issued United States patents and 63 patent applications pending as of December 31, 2022[68]