Segment Information

12 Months Ended

Dec. 31, 2022

Segment Information

Segment Information

17. Segment Information

The Company has two reportable segments that are also our operating segments: Vertical Software and Insurance. Our reportable segments have been identified based on how our chief operating decision-maker (“CODM”) manages our business, makes operating decisions and evaluates operating and financial performance. The chief executive officer acts as the CODM and reviews financial and operational information for our two reportable segments. Operating segments are components of an enterprise for which separate discrete financial information is available and operational results are regularly evaluated by the CODM for the purposes of making decisions regarding resource allocation and assessing performance.

Our Vertical Software segment primarily consists of a vertical software platform for the home, providing software and services to home services companies, such as home inspectors, moving companies, utility companies, title companies and others, and includes software subscription and service fees from companies, and non-insurance revenue.

Our Insurance segment offers various forms of homeowner insurance policies through its own insurance carrier and certain homeowner and auto insurance policies through its licensed insurance agency. The Insurance segment also includes home warranty service revenue.

The following table provides the Company’s revenue by segment:

	Year Ended December 31,
	2022		2021		2020
Segment revenues:
Vertical Software	$	154,915	$	137,150	$	63,799
Insurance		121,033		55,283		4,166
Divested businesses		—		—		4,334
Total segment revenue	$	275,948	$	192,433	$	72,299

During 2020, our insurance revenue was generated solely from commissions earned from third-party insurance carriers through EIG, which began its operations in early 2020.

Our segment operating and financial performance measure is segment Adjusted EBITDA (loss). Segment Adjusted EBITDA (loss) is defined as (i) revenue less (ii) the following expenses associated with our segments: cost of revenue, sales and marketing, product and technology, and general and administrative expenses, excluding (iii) non-cash items or items that management does not consider are reflective of our ongoing core operations.

Currently, we do not allocate any shared expenses to our reportable segments. We include these expenses in Corporate and Other. Corporate and Other includes shared expenses such as sales and marketing, certain product and technology, accounting, human resources, legal and general and administrative, and other income, expenses, gains and losses that are not allocated in assessing segment performance due to their function. Such transactions are excluded from the reportable segments results but included in reported consolidated results.

The reconciliation of segment Adjusted EBITDA (loss) to consolidated loss from operations below includes the effects of corporate and other items that the CODM does not consider in assessing segment performance.

The following tables provide financial information for our two reportable segments and reconciliations to consolidated financial information for the periods presented:

	Year Ended December 31,
	2022		2021		2020
Segment adjusted EBITDA (loss):
Vertical Software	$	14,678	$	20,733	$	12,718
Insurance		(5,499)		9,007		405
Corporate and Other		(58,780)		(53,760)		(30,001)
Divested Businesses		—		—		(1,441)
Total segment adjusted EBITDA (loss)		(49,601)		(24,020)		(18,319)
Reconciling items:
Depreciation and amortization		(27,930)		(16,386)		(6,644)
Non-cash stock-based compensation expense		(27,041)		(38,592)		(11,296)
Acquisition and other transaction costs		(2,334)		(5,360)		(311)
Impairment loss on intangible assets and goodwill		(61,386)		—		—
Non-cash losses and impairment of property, equipment and software		(637)		(550)		(611)
Revaluation of contingent consideration		(6,944)		2,244		(1,700)
SPAC transaction bonus		—		—		(3,350)
Investment income and realized gains		(1,174)		(701)		—
Operating loss	$	(177,047)	$	(83,365)	$	(42,231)

The CODM does not review assets on a segment basis. As of December 31, 2022, goodwill for the Vertical Software segment and the Insurance segment was $191.9 million and $52.8 million, respectively. As of December 31, 2021, goodwill for the Vertical Software segment and the Insurance segment was $182.8 million and $42.9 million, respectively.

All of the Company’s revenue is generated in the United States, except for an immaterial amount. As of December 31, 2022, and 2021, the Company did not have material assets located outside of the United States.