The RealReal, Inc. (the “Company”) is an online marketplace for authenticated, consigned luxury goods across multiple categories, including women’s, men’s, kids’, jewelry and watches, and home and art. The Company was incorporated in the state of Delaware on March 29, 2011 and is headquartered in San Francisco, California.

The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and the requirements of the U.S. Securities and Exchange Commission (the “SEC”) for interim reporting. The Company’s functional and reporting currency is the U.S. dollar.

The condensed balance sheet as of December 31, 2018 included herein was derived from the audited financial statements as of that date. The accompanying unaudited condensed financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company’s financial position, results of operations, comprehensive loss, redeemable convertible preferred stock, convertible preferred stock, and stockholders’ deficit, and cash flows for the periods presented.

These unaudited condensed financial statements should be read in conjunction with the Company’s financial statements and notes included in the final prospectus filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933, as amended on June 28, 2019 (the “Prospectus”).

The Company’s registration statement on Form S-1 (the “IPO Registration Statement”) related to its initial public offering (“IPO”) was declared effective on June 27, 2019, and the Company’s common stock began trading on the Nasdaq Global Select Market on June 28, 2019. On July 2, 2019, after the quarter end, the Company completed its IPO, selling 15,000,000 shares of common stock at price to the public of $20.00 per share, plus an additional 2,250,000 shares of common stock at a price to the public of $20.00 per share pursuant to the exercise of the underwriters’ option to purchase additional shares. On July 2, 2019, after the quarter end, the Company received aggregate net proceeds of $320.9 million after deducting underwriting discounts and commissions of $24.1 million.

Immediately prior to the completion of the IPO, the Company filed its Amended and Restated Certificate of Incorporation, which authorizes a total of 500,000,000 shares of common stock, and 50,000,000 shares of undesignated preferred stock.

The unaudited pro forma condensed balance sheet data set forth below is presented as if the IPO was completed on June 30, 2019, by applying adjustments to the Company’s historical condensed balance sheet. The pro forma adjustments reflect the issuance of 17,250,000 shares of common stock for aggregate net proceeds of $320.9 million and the reclassification of deferred offering costs of $5.3 million to additional paid-in capital. The proforma adjustments do not include the $3.2 million donation to The RealReal Foundation, which the Company anticipates funding in the latter part of 2019.

The pro forma adjustments also reflect the conversion of 114,960,357 shares of convertible preferred stock and redeemable convertible preferred stock then outstanding into 58,363,606 shares of common stock and the corresponding reclassification of the preferred stock warrant liability to additional paid-in capital upon conversion of all outstanding preferred stock warrants into an aggregate of 103,563 common stock warrants.

	Actual June 30, 2019			Pro Forma Adjustments			Pro Forma June 30, 2019
	(in thousands)
Assets
Total current assets	$	99,430		$	320,850		$	420,280
Total noncurrent assets		58,700			(5,307	)		53,393
Total assets	$	158,130		$	315,543		$	473,673
Liabilities, Redeemable Convertible Preferred Stock, Convertible Preferred Stock and Stockholders’ Equity (Deficit)
Total current liabilities	$	86,846		$	—		$	86,846
Total noncurrent liabilities		10,076			(2,710	)		7,366
Total liabilities		96,922			(2,710	)		94,212
Redeemable convertible preferred stock		198,228			(198,228	)		—
Convertible preferred stock		169,102			(169,102	)		—
Stockholder’s equity (deficit)
Common stock		1			1			2
Additional paid-in capital		1,729			685,582			687,311
Accumulated other comprehensive income		5			—			5
Accumulated deficit		(307,857	)		—			(307,857	)
Total stockholders’ equity (deficit)		(306,122	)		685,583			379,461
Total liabilities, redeemable convertible preferred stock, convertible preferred stock, and stockholders’ equity (deficit)	$	158,130		$	315,543		$	473,673

On June 13, 2019 the Company effected a reverse split of shares of the Company’s common stock on a 1-for-2 basis (the “Reverse Stock Split”). All issued and outstanding shares of common stock, warrants for common stock, options to purchase common stock and the related per share amounts contained in the financial statements have been retroactively adjusted to reflect this Reverse Stock Split for all periods presented. The par value and authorized shares of common stock were not adjusted as a result of the Reverse Stock Split. Additionally, the authorized, issued and outstanding shares of redeemable convertible preferred stock and convertible preferred stock and their related per share amounts, other than the conversion price per share, were not adjusted as a result of the Reverse Stock Split.