Segment Information

3 Months Ended

Mar. 31, 2023

Segment Information

Segment Information

14. 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:

	Three Months Ended March 31,
	2023		2022
Segment revenues:
Vertical Software	$	28,627	$	34,404
Insurance		58,742		29,163
Total segment revenue	$	87,369	$	63,567

The Company’s segment operating and financial performance measure is segment Adjusted EBITDA (loss). Segment Adjusted EBITDA (loss) is defined as revenue less the following expenses associated with these segments: cost of revenue, sales and marketing, product and technology, and general and administrative expenses. Segment Adjusted EBITDA (loss) also excludes non-cash items or items that management does not consider are reflective of ongoing core operations.

Currently, the Company does not allocate any shared expenses to the reportable segments. These expenses are included 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 the two reportable segments and reconciliations to consolidated financial information for the periods presented:

	Three Months Ended March 31,
	2023		2022
Segment adjusted EBITDA (loss):
Vertical Software	$	(396)	$	2,884
Insurance		(7,185)		216
Corporate and Other		(14,301)		(13,527)
Total segment adjusted EBITDA (loss)		(21,882)		(10,427)
Reconciling items:
Depreciation and amortization		(6,015)		(6,483)
Non-cash stock-based compensation expense		(6,894)		(5,854)
Acquisition and other transaction costs		(1,112)		(895)
Impairment loss on intangible assets and goodwill		(2,021)		—
Non-cash losses and impairment of property, equipment and software		—		(69)
Revaluation of contingent consideration		154		(3,205)
Investment income and realized gains		(758)		(197)
Non-cash bonus expense		—		(1,526)
Operating loss	$	(38,528)	$	(28,656)

The CODM does not review assets on a segment basis.

All of the Company’s revenue is generated in the United States, except for an immaterial amount. As of March 31, 2023, and December 31, 2022, the Company did not have material assets located outside of the United States.