Financial Results for the 2nd Quarter of Fiscal Year ... · Financial Results for the 2nd Quarter...

Financial Results for the 2nd Quarter ofFiscal Year Ending November 30, 2019

Money Forward, Inc.

July 16, 2019

1Contents

Money Forward Business P.17

Overview P.11

Money Forward X P.33

Money Forward Home P.27

FY11/19 Q2 Financial Highlights and Topics P.10

Highlights P.7

Other Strategic Initiatives P.42

Appendix P.45

Money Forward Finance P.37

Our Business P.2

Our Business

3Mission / Vision / Value / Culture

4Our Services

Cloud-based Bookkeeping Service

Cloud-based Business Analysis Tool

Practical Economic Media

Automated PFM Service

Platform for Comparing and Applying for Financial Services

Automated Savings App

Personal Finance Consulting Outlet*

Coupon App

for ○○

Customized Money Forward ME for Financial Institutions and its Clients

Cloud-based Services for Financial Institutions and its Clients

Passbook Apps

Passbook Apps for Financial Institutions and its Clients

MF Unit

Offering PFM Tools within Financial Institutions Apps

BPO and Factoring ServiceSaaS Platform for Back Office Operations

Cloud My Number

Cloud Invoice

Cloud Payroll

Cloud Expense

Cloud Tax Return

Cloud Accounting

Cloud Finance

Cloud Attendance

Cloud for ○○

Make everyone’s life convenient and prosperous.

Accelerate business growth.Create new financial services

with partners.Circulate money

towards right direction.

Money Forward. Move your life forward.

※ The outlet of mirai talk in Tokyo will be closed by the end of 2019.

Online Lending Service

BFMFinancial management service for financial institutions’ corporate clients

Cloud Series

5Our Business Model 5

Securities

Banks

ConnectedServices

Services

for 〇〇 seriesPassbook AppsBFM

CreditCards

ElectronicMoney

E-Commerce

Corporates

Individuals

Financial institutions

Corporates

Sole proprietors

Accountants

Customers

etc.

Technology

etc.

Connection with 3,500+ services

Account aggregation/API connection

Wide-ranging service lineup with strengths in UI/UX

Nationwide customer base

Da

ta

Infra

stru

ctu

re

Cloud

6Nationwide Partnership

Certified members: 187CCI: 11FI: 5Branch: Hokkaido and Tohoku

Certified members: 650CCI: 8FI: 2Branch: Kyoto and Kansai

Certified members: 392CCI: 17FI: 7Branch: Tokai/Hokuriku

Certified members: 2,071CCI: 15FI: 12

Certified members:114CCI: 15FI: 3Branch: Hiroshima

Certified members: 35CCI: 5

Certified members: 280CCI: 16FI: 1Branch: Kyushu/Okinawa

No. of Certified Members:

3,700+(Accounting firms andcertified social insurance and labor consultant offices)

No. of Financial Institutions (FI)Served with Our Products:

30

No. of Chambers of Commerce and Industry (CCI) that We Partner with:

87

Established offices in 8 cities across Japan through which we help reinvigorate regional economies leveraging on our technology and real-world community.

Hokkaido & Tohoku

Chubu

Kanto

Chugoku

Kinki

Shikoku

Kyushu & Okinawa

Highlights

8Financial Highlights in FY11/19 Q2

• Consolidated net sales for Q2 YTD increased by 53% YoY to ¥3.06 billion.Achieved record-high net sales in all of our domains.

• In Business domain, consolidated net sales for Q2 YTD increased by 56% YoY.

• Number of Money Forward ME users reached 8 million, with the number of premium paying users exceeding 190,000.Annual subscription plan increased to 11% of total paying users.

• X domain achieved record-high stock and flow sales.

• Consolidated gross profit margin was 62% while consolidated EBITDA was negative ¥0.53 billion in Q2, improving from Q1.

9Key Topics in and after FY11/19 Q2

• Completed transition to the new pricing plan for the Money Forward Cloud series. Associated churn was within the expected range. Stock sales in Business domain is expected to grow at a rate of 60%-65% YoY in 2H.

• Making steady progress in measures for tax reforms including the reduced tax rate.

• Plans to launch BFM, financial management service targeting financial institutions’ corporate customers.

• Expects full-year growth rate in net sales to exceed our initial forecast of 55%, and steadily making progress toward achieving our full-year net sales forecast.

FY11/19 Q2 Financial Highlights and Topics

11

1,997

3,059

0

500

1,000

1,500

2,000

2,500

3,000

18/11期

2Q累計

19/11期

2Q累計

Consolidated Net Sales (YoY Comparison)

Consolidated net sales continued to grow in Q2 YTD, increasing by 53% YoY.

11

（¥ mn）

+53%

YoY

FY11/18Q2 YTD

FY11/19Q2 YTD

12

272 354 401

477 533 599

715 833 853

919

172

211 212

311 265

304

299

397 370

403

65

126 117

173 102

178 97

197 125

263

2

3

7 17

36 48

74

510

693 732

965 906

1,091 1,130

1,469 1,398

1,661

0

200

400

600

800

1,000

1,200

1,400

1,600

Consolidated Net Sales (Quarterly Trend)

Achieved record-high net sales in all domains.

（¥ mn） ■Business ■Home ■X □ Finance ■ Other

※ Exclude labelling for Other net sales from above graph.

(YoY)

FY11/17(Consolidated)

1Q 2Q 3Q 4Q


1Q 2Q 3Q 4Q


1Q 2Q

+52%

YoY

+53%

+32%

+48%

+¥67mn

13Gross Profit / EBITDA (Quarterly Trend)

Gross profit reached a record high, while gross profit margin improved to62%. EBITDA loss decreased owing to an increase in net sales and decrease in marketing expenses.

Gross Profit EBITDA

※ EBITDA = Operating profit/loss + depreciation + amortization

(¥mn) □Gross profit ■Gross profit margin (¥mn) □EBITDA □ EBITDA (excl. advertising expenses)

610 709 672

792 746

1,022

67%65%

59%

54% 53%

62%

0%

20%

40%

60%

80%

0

200

400

600

800

1,000

FY11/18

Q1

FY11/18

Q2

FY11/18

Q3

FY11/18

Q4

FY11/19

Q1

FY11/19

Q2

△94 △67

△247 △246

△941

△525

53 47

△141 △162

△374

△246

△1,050

△650

△250

150

FY11/18

Q1

FY11/18

Q2

FY11/18

Q3

FY11/18

Q4

FY11/19

Q1

FY11/19

Q2

14

468 534 588 723

844 979 109

143 160

313 308

291

75 98

103

153 125

110

34

64 115

113 113

123

41

46

63

78 101

133

154

189

282

293

324

320

147

114

106

84

567 279

1,029

1,188

1,416

1,757

2,382 2,235

0

400

800

1,200

1,600

2,000

2,400

FY11/18

Q1

FY11/18

Q2

FY11/18

Q3

FY11/18

Q4

FY11/19

Q1

FY11/19

Q2

Personnel Expenses Subcontract Expenses Comission Fee Rents

Communication Expenses Other Advertising Expenses

Breakdown of Expenses (Cost of Sales & SGA)

Total expenses decreased due to the end of TV advertisement during the previous quarter. Continued active investments in marketing.

（¥ mn）

※ Other expenses for FY11/19 Q2 include recruiting/training expenses (¥66mn) and traveling and transportation expenses (¥31mn).

Advertising Expenses

Business domain:Captured demand for tax returns. Also focused on promoting Money Forward Cloud Attendance, a new addition to the platform.

Home domain:Continued active web marketing. Saw an accelerated increase in the number of Money Forward ME users.

15

120

177

24432

44

64

15

23

31

10

52

47

29

43

78

35

55

66

241

394

530

0

100

200

300

400

500

11/17 End

(Consolidated)

11/18 End

(Consolidated)

5/19 End

(Consolidated)

Business Home X Finance Other Engineer / Designer Corporate

Full-time Employees

Made firm progress in recruiting, with the number of full-time employees increasing to 530 (+136 from the end of FY11/18 and +81 QoQ).Transfer of all Money Forward Financial employees was determined by June 30.

※ Other Engineer/Designer includes CISO Dept., CTO Dept., Account Aggregation Dept., MONEY FORWARD VIETNAM etc.Corporate includes CEO’s Office, Corporate Planning Dept., Finance Dept., Administrative Dept., Human Resource Dept., Fintech Research Office, etc.

（# of people）

• tock pop, SiraTama etc. were transferred to Home domain

• Enhanced infrastructure/security

• Vietnam expansion

• Enhanced respective features

◼ Engineers◼ Designers◼ Sales◼ Marketing◼ Customer Success◼ Customer Support

Other Engineer / Designer

16

4,952

10,095

0

2,000

4,000

6,000

8,000

10,000

12,000

FY11/18

Q4 End

FY11/19

Q2 End

1,462

5,972

FY11/18

Q4 End

FY11/19

Q2 End

3,383

8,598

FY11/18

Q4 End

FY11/19

Q2 End

Maintain Balance Sheet for Further Investments

While continuing to invest actively in FY11/19, we maintain stable balance sheet. Equity offering was carried out in December 2018.

Cash Net Cash* Total Net Assets

（¥ mn）

※ Deducted amount of debt from cash amount.

Money Forward Business

Outlook for Japan’s Software Market Size

The software market size is expanding on the back of workstyle reforms and promotion of cloud. In particular, the Saas market is forecasted to expand rapidly to ¥641.2 billion (an increase of ¥254.1 billion).

18

※ Fuji Chimera Research Institute, Inc., 2018 New Software Business Market.

Software

¥1.3 tn

SaaS

¥387.1 bn

2017

2022

Software

¥1.7tn

(+¥445.9 bn)

SaaS

¥641.2 bn

(+¥254.1 bn)

Providing a Paradigm Shift - Integrated Back Office

Plans to facilitate a shift from a world filled with cumbersome manual back office operations to one which automatically connects back office functions through cloud.

19

Invoice

Payroll Statement

Attendance Sheet

My Number

Expense Statement

Conventional Back Office- Manual entries based on paperwork - Integration of back office functions

Attendance

Payroll

Invoice

Accounting

Expense

Cloud

Manual Entry to AccountingSoftware My

Number

New Pricing Plan for Optimizing Back Office Operations 20

Released a new bundled service which enables sole proprietors and corporates with 30 or less employees to use five services at attractive price.

Cloud Accounting

Cloud Tax ReturnCloud Invoice Cloud Expense Cloud Payroll Cloud My Number

Corporates Sole proprietors

Using 5 services at attractive price

Money Forward Cloud

Minimum ¥3,980/month

Minimum ¥1,280/month

Customer Feedback on New Pricing Plan 21

• It is difficult to streamline operations and raise productivity using only an accounting software.

• We are grateful that Money Forward has taken steps to provide this bundled service instead of only providing stand-alone products.

• Improved operational efficiency enables the accounting industry to provide a wider range of services.

Tomoaki Sato Tax Accountant Office (Hokkaido)

• We have been using another invoice service but want to take this opportunity to shift to Money Forward Cloud Invoice.

• We currently use Excel to calculate payrolls and were wondering what advantages Money Forward Cloud Payroll offers. We plan to use the service as it seems convenient.

Private company (Kanagawa)

Tax Accountant

Corporate

Chamber of Commerce and Industry

• Saving labor in the back office becomes effective by connecting managerial operations not only within the accounting division but also among various division. We therefore expect that the bundled service will produce even larger effects.

• This will open a new path for improved efficiency to businesses that were content with simply promoting the use of cloud in accounting operations.

The Mastuura Chamber of Commerce and Industry (Nagasaki)

Supporting Sole Proprietors, Pre-IPO and Listed Companies

Enhanced product functions have enabled us to support a wider range of companies.

22

Sole ProprietorsSMEs

Pre-IPO andListed Companies

Aims to enhance functions targeting pre-IPO and listed companies

(in Accounting this winter and Attendance this autumn)

Tax Return Invoice Expense

Payroll My Number

STREAMED

Accounting Invoice Expense

Payroll My NumberAttendance

ManageboardSTREAMED

Cloud Accounting

Cloud Attendance

Accounting Invoice Expense

Payroll My NumberAttendance

ManageboardSTREAMED

※ Consolidated with net sales from Knowledge Labo, Inc. and Wakufuri, Inc. which joined the Group in Jul. 2018 and Aug. 2018, respectively (from FY11/18 Q4)※ Flow sales include 1) fees for implementation of services, 2) development fees from Money Forward Cloud Series for corporates, 3) seminar ticket sales

(e.g. MF Cloud Expo), 4) consulting fees from Knowledge Labo, Inc. , 5) net sales of Wakufuri, Inc., etc. ※ In past disclosure, development and maintenance charges from Money Forward Cloud Series for financial institutions were categorized in “Alliance Businesses” of

“Money Forward Cloud Services”. From FY11/19 and onwards, the sales are excluded from Money Forward Business, but included in Money Forward X.

Net Sales from Money Forward Business 23

Stock sales continued to increase. Increase in ARPU due to shifts to the new bundled service would be reflected from 3Q, and 2H stock sales is expected to grow at a rate of 60-65% YoY.

（¥ mn）■ Stock Sales □ Flow Sales


1Q 2Q 3Q 4Q


1Q 2Q 3Q 4Q


1Q 2Q

Klavis Inc. which providingSTREAMED joined the Group

+53%

YoY

255 314

371 416 518

584 641

693 782

856

17 40

30

60

16

15 74

140 71

63

272

354 401

477

533

599

715

833 853 919

0

200

400

600

800

Measures for Consumption Tax Reform / Reduced Tax Rate 24

Customers can adapt to the consumption tax reform and reduced tax rate without purchasing new services or paying additional fees.

Money Forward Cloud enables automated journal entries based on the reduced tax rate*

*We will disclose new measures on an ongoing basis.

Accounting personnel/sole proprietor

e.g., Invoice

e.g., Receipt

sales

Exp-ense

Cloud Invoice Cloud Accounting

Cloud Accounting

Automated journal entry

Issue/book invoices or book sales from cash registers by linking Money Forward Cloud

Accounting and Money Forward Cloud Invoice.

Avoid cumbersome booking of payment requests and receipts with STREAMED and

Money Forward Clout Accounting.

Redesigning of Tax Return App by the End of 2019 25

Customers will be able to complete journal entries on the app based on statements or direct manual entries. Interface will be user friendly even for sole proprietors without tax return experience.

Select credit card statement

Enter details without deliberating journal entry

Confirm journal entry after entering details

※ Interface is still under development.

Partnership Spanning the Nation

Held an event with 300+ accounting and tax professionals by connecting five locations across Japan. Realizing corporate support and regional reinvigoration leveraging on technology and the real-world community.

26

Money Forward Home

28Net Sales from Premium Charges (Trend in Net Sales)

Number of paying users exceeded 190,000*. Approximately 20% of the new premium users selected the annual subscription plan. The churn rate is expected to decline further.

※ As of end of May 2019


1Q 2Q 3Q 4Q


1Q 2Q 3Q 4Q


1Q 2Q

Launched annual subscription plan

（¥ mn） □ Net Sales from Premium Charges ■ Number of Paying User （thousandpeople）

110 128 139

158 174

199 213

226 244

263

0

50

100

150

0

50

100

150

200

250

+32%

YoY

29

62

83 73

153

92 105

86

172

126 140

0

50

100

150

Net Sales from Media/Advertising (Trend in Net Sales)

Sales from events and seminars, including Real Estate 1 Day School, continued to be solid in Q2.

Money EXPO2017▼

（¥ mn） Money EXPO2018▼

※ Net sales from media/advertising include 1) advertising sales from MONEY PLUS - practical economic media, 2) sales from events (Money EXPO) and seminars (e.g., on real estate and DC plan), and 3) sales from other PFM services including mirai talk.


1Q 2Q 3Q 4Q


1Q 2Q 3Q 4Q


1Q 2Q

+33%

YoY

30Accelerated Increase in Money Forward ME Users

Number of Money Forward ME users exceeded 8 million.The effect of TV advertising campaigns among other factors contributed to the accelerated increase in number of users.

No. of Users Exceeded 8 Million Accelerated Increase in Users

650mn

May-18

700mn

Oct-18

750mn

Feb-19

800mn

May-19

Dec.2017 May.2019

6 months

5 months

4 months

▲TV ad

31

2014-01 2015-01 2016-01 2017-01 2018-01 2019-01

Money Forward ME - New Accounts Aggregated

TV advertising campaigns implemented during the year-end and new-year holidays contributed to sustaining large numbers of additional accounts and services aggregated by users.

FY11/14 FY11/15 FY11/16 FY11/17 FY11/19FY11/18

※ Total number of accounts that users aggregated into Money Forward ME, per quarter. Examples of accounts and services include bank accounts, securities accounts, credit card, pension plan, mileage and reward points.

TV ad▼

TV ad▼

TV ad▼

32Launch of SiraTama for Prepaid Cards

In collaboration with Credit Saison, the new app enables automatic saving for those who find it difficult to save. Savings are added to prepaid cards and can be spent on online shopping.

How SiraTama for Prepaid Cards Works

Save Spend

1. Credit Card

Linking with a credit card enables users to start saving spare change.

2. SiraTama for Prepaid Cards

Spare change is added to Siratama for Prepaid Cards.

3. Online Shop

Added money can be used to shop online.

Money Forward X

34Net Sales from Money Forward X

Stock sales rose steadily owing to increased provision of services to new business partners. Both stock and flow sales reached record-high levels on a quarterly basis.

（¥ mn） ■ Stock Sales □ Flow Sales

※ Flow sales from initial development charges are to be recorded at the acceptance by partner financial institution, not at service launch time.


1Q 2Q 3Q 4Q


1Q 2Q 3Q 4Q


1Q 2Q

49 55 64 71 79 84 82 79 84 93 17

71 54

103

23

94

15

118

42

170

65

126 117

173

102

178

97

197

125

263

0

50

100

150

200

250

+48%

YoY

35BFM (Business Financial Management) to Be Released

Plans to release a financial management service targeting financial institutions’ corporate clients. The service visualizes SMEs’ finances by consolidating balances and banking statements of multiple bank accounts.

Uses regularly

Online connection

Corporate client

Financial institutionAttracts client

to service

銀行と中小企業を繋ぐオンラインの場を作ります。

Consolidates bank account

info by connecting with

multiple financial institutions

Provides real-time financial

status of corporate

As a first step, the Okazaki Shinkin Bank plans to start providing BFMto corporate clients from autumn of 2019.

36Strategic Direction Pursued by BFM

In addition to visualizing corporates’ cash flow, the service will implement functions with an aim to improve efficiency. With our business partners, we aim to resolve issues regarding corporates’ finances.

Function provided by BFM at time of launchVisualize Current Cash Flow

Visualize Future Cash Flow

Connect with bank’s accounts/Connect with other banks’ accounts/(Connect with other services)

Direction 1:Evolution of financial management operations

Direction 2:Additional functions and services required by corporate clients(active collaboration with other companies)

Simulate Future Cash Flow

Secure funds, Automatic Lending

Manage future deposits and withdrawals/Create cash management graphs/Raise alerts

Forecast based on past behavior/Forecast based on other factors

Apply for loans/Obtain automatic lending within credit line

• Connect with other services

• Automatic lending

• AI banker

• Business Matching

Money Forward Finance

38Aiming to Support Corporates’ Cashflow

Step1 Step2 Step3

Streamline Operations

Enhance Added Value

and Profitability

Working Capital Support

Cloud

39

2 3 7 17

36

48

74

0

10

20

30

40

50

60

70

Net Sales from Money Forward Finance

MF KESSAI, business process outsourcing and factoring service, continues to drive growth in net sales.

（¥ mn）


4Q


1Q 2Q 3Q 4Q


1Q 2Q

Over 10x

YoY

40MF KESSAI Connected with CAINZ-DASH PRO

01 Enables shipping products immediately after orders are made

regardless of the payment method.

02 Prevents failed orders due to unsuitable payment methods or deposit

deadlines.

03 Ensures deposits using MF KESSAI.

04 Handles invoice payment (deferred payment) which is common

among inter-company transactions.

Advantages of CAINZ

Formed partnership with a product ordering service which targets construction workers and is operated by CAINZ CORPORTION.Started offering a deferred payment function. Completes credit screening within a few seconds at shortest.

41

Four Features of

Release of New Online Lending Service

Released Money Forward BizAccel *1, an online lending service which utilizes cloud accounting data and other data with an aim to support SMEs’ cash management. We plan to collaborate with financial institutions.

※1 The service is offered by Money Forward Fine, Inc., a subsidiary of Money Forward, Inc.※2 Payment will be made on the date of customers’ choice, 3 - 10 business days after the contract date.

2

No financial statement is necessary

Screening is conducted based on accounting data

Enables speedy payment *2

No guarantor or collateral is necessary

No need to submitcopy of company register

Company Register

Cloud Accounting

3 business days

Other Strategic Initiatives

43Participation in Promotion of Unified QR Code, JPQR, Led by the Government

Was certified as a “provider of interface for unified management of retail store sales.” Is committed to promoting the widespread use of unified QR code with an aim to help create a cashless society.

Future Investment Strategy 2018“Promoting the Shift toward a Cashless Society”

Period August 1, 2019 to January 31, 2020

Prefecture Iwate, Nagano, Wakayama and Fukuoka

“Promoting the widespread use of unified QR code, JPQR ”

44

Money Forward. Move your life forward.

Appendix

About Us

47CEO Profile 47

Yosuke TsujiRepresentative Director, President and CEO

Yosuke Tsuji worked at Sony Corporation and Monex Securities before establishing Money Forward, Inc. in 2012. He currently serves as an Executive Officer of the Japan Association of New Economy (JANE) and committee member of the METI Fintech Review Conference. Kyoto University Faculty of Agriculture (BS), Wharton School, University of Pennsylvania(MBA).

Awards (including awards to Money Forward)

Jan. 2014 US Embassy’s Award at the Entrepreneur Awards Japan (TEAJ) 2014

Feb. 2014 JVA Chief Judge’s Award at the Japan Venture Awards (JVA) 2014

Mar. 2014 Grand Prize at the Financial Innovation Business Conference (FIBC) 2014

Nov. 2016 Ranked in Forbes Japan’s “Japan’s Top 10 Entrepreneurs” for two consecutive years

Dec. 2016 Selected by Nikkei Business magazine as one of “The 100 Most Influential People for

Japan 2017”

Feb. 2018 Judges Association’s Special Award at the Japan Venture Awards 2018

48Executive Profiles

Takashi IchikawaDirector, Executive Officer and CISO

・Joined Money Forward, Inc. in 2012. Appointed as director in 2017.

・2011-2012: Major financial systems development company. Led the infrastructure division and launched a new FX transactions site.

・2000-2011: Monex Group, Inc. Developed and operated securities trading systems and engaged in project management for subsidiary mergers, etc.

Naoya KanesakaDirector, Executive Officer, Corporate Development


・2007-2014: Goldman Sachs (Tokyo and San Francisco offices). Engaged in advisory services for cross-border M&As and fund procurement mainly in the technology and financial industries, and in enhancing value of investee companies.

・Graduated The University of Tokyo (Faculty of Economics) in 2007.

Toshio TakiDirector and Executive OfficerHead of Money Forward Fintech Institute

・Appointed as director of Money Forward, Inc. in 2012.・Member of FSA panel of experts on FinTech start-ups.・2004-2012: Nomura Securities Co., Ltd./Nomura Institute

of Capital Markets Research. Engaged in research on household behaviour, the pension system, and financial institution business models etc.

・Graduated Keio University (Faculty of Economics) in 2004 and Stanford University (MBA) in 2011.

Hirokazu BanDirector, Executive Officer and Administration Division Manager


・2009-2015: SBI Securities Co., Ltd. Served in the Legal and Corporate Planning Departments. Launched SBI Money Plaza Co., Ltd. in 2012 and became director.

・Graduated Waseda University (Sociology) in 2001. After graduating Aoyama Gakuin University Law School, registered as an attorney in 2008.

Takuya NakadeDirector, Executive Officer and CTO

・Joined Money Forward, Inc. in 2015. Developed financial systems, and was appointed as CTO in 2016 and director in 2018.

・2007-2014: Simplex Inc. Developed stock trading systems catered to securities companies.

・2001-2007: Jupiter Shop Channel Co., Ltd. Led CRM system development as IT manager.

Our management team has in-depth expertise in finance and technology.

Masanobu TakedaDirector, Executive Officer and Money Forward Cloud Sales & Marketing Division Manager

Joined Money Forward in 2017 Inc after the acquisition of Klavis Inc., where he served as Director and CFO since 2016. Prior to joining Klavis, he served as Director at Macromill Group, in charge of corporate planning where he lead the company’s corporate and HR strategic planning, M&As, and new business development, and as Director and Head of Corporate Planning at eole Inc.

49Executive Profiles

Highly experienced leaders in the Japanese economy are appointed as External directors and Advisors.

Makoto HarutaAdviserRepresentative Director and CEO, betaCatalyst Inc.

Established betaCatalyst Inc. in 2015. Former Director and Chairman of DeNA Co., Ltd. During his time with DeNA, Mr. Haruta led DeNA’s IPO as CFO, established JVs wth major corporations, and oversaw M&As, including the acquisition of the Yokohama DeNA BayStars.

Nobuaki KurumataniExternal DirectorDirector, Representative Executive Officer Chairman and CEO, Toshiba Corporation

Former Representative Director, Deputy president and Executive Officer of Sumitomo Mitsui Banking Corporation. Former President of Japan, CVC Capital Partners.

Takashi MitachiAdviser (Former External Director)The Boston Consulting GroupSenior Advisor

External Director of Rakuten, Inc., and visiting professor at the Graduate School of Management, Kyoto University. Earlier in his career he worked for Japan Airlines, then Boston Consulting Group where he served as a member of the Global Management Committee for more than 10 years.

Akira KurabayashiExternal DirectorManaging Director, DNX Ventures

Joined DNX Ventures (former Draper Nexus Venture Partners) in 2015 where he currently serves as Managing Director. Engaged in venture capital businesses targeting Japan and the U.S. at Fujitsu Limited and Mitsui & Co., Ltd. Oversaw investments in Japan at Globespan Capital Partners and Salesforce Ventures.

Masaaki TanakaExternal DirectorExecutive Chairman of the Board, Nippon Paint Holdings Co., Ltd.

Former Director and Deputy President at Mitsubishi UFJ Financial Group and former President and COO of INCJ, Ltd. Current member of the Financial Services Agency (FSA) panel of experts on Fintech startups and other government-related panels. Appointed adviser to the FSA in February 2017.

Etsuko OkajimaExternal DirectorCEO, ProNova Inc.

Etsuko Okajima founded ProNova Inc in 2007, and currently serves as CEO of the company. Earlier in her career, she worked at Mitsubishi Corporation, McKinsey & Company, and Globis Group, where she served as President of Globis Managment Bank Inc. Ms Okajima holds an MBA from Harvard University.

50Money Forward Group Structure 50

*Knowledge Labo, Inc., Wakufuri, Inc. and MONEY FORWARD VIETNAM CO., LTD. were consolidated at the end of FY11/18 Q3.

Money Forward, Inc.

Ownership Main Service

MF KESSAI, Inc. 100％

MF HOSHO, Inc. 100％

BPO and factoring service: MF KESSAI

Obligation guarantee and credit inquiry forMF KESSAI

mirai talk, Inc. 90％ Personal finance consulting outlet: mirai talk

Klavis, Inc. 100％ Automated bookkeeping service: STREAMED

Money Forward Financial, Inc. 100％Blockchain / crypto currency-related research

Money Forward Fine, Inc. 100％ AI-based loan screening model

PFM service and Money forward Cloud service

Knowledge Labo, Inc. 51％ Manageboard and consulting service

Wakufuri, Inc. 56％ Assisting cloud software implementation

MONEY FORWARD VIETNAM CO., LTD. 100％ Product development center

51

0

1,000

2,000

3,000

4,000

5,000

Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19

1000

2000

3000

4000

5000

6000

Share Price and Trading Volume since IPO

※ As of July 12, 2019

July 12, 2019Close ¥3,430

（¥） ━ Share Price(LHS) ■Trading Volume(RHS) (‘000 Shares)

52Promotion of Fintech/SaaS by the Japanese Government

The Japanese government has set four KPIs to promote Fintech as part of its “Future Investment Strategy 2017.” It aims to raise the ratio of cloud-based back office operations to 40% by 2022.

Promote open banking APIsAims to promote the adoption of open banking APIs by 80+ banks within three years (by June 2020).

Double the cashless payment ratioAims to double the cashless payment ratio to some 40% of all payments within the next decade (by June 2027).

Migrate 40% of back office operations to cloud by 2022Aims to increase the ratio of SMEs that utilize IT and cloud services etc. to improve productivity of back office operations. Target at 40% within five years (by June 2022).

Improve cash conversion cycle by 5%Aims to improve Japan’s Supply Chain Cash Conversion Cycle (SCCC) by 5% until FY2020.

※ “Future Investment Strategy 2017 No.2-I-5 Promotion of FinTech,” June 2017

53Disciplined Investment Execution 53

Product Development/New Business Investments• Basic policy is to start with minimal investment to achieve product market fit, followed by the

decision to invest further.• Constant launch of add-ons and new businesses contribute to ARPPU increase, customer base

expansion and product competitiveness.• M&A is also considered as an effective means of entering new business, adding functions and/or

customers.

Investment in Sales, Marketing and Customer Success• Investment in sales, marketing and customer success to be accelerated as long as unit economics

metrics are reasonable and sound.• Investment decisions to be made based on the unit economics metrics described in next page.

Continuous Review and Revision of Product/Business• Businesses are assessed by growth, market opportunities/competition and profitability every quarter

to make appropriate decisions such as withdrawal.

54Unit Economics-Driven Investment

Unit economics per product and per customer channel are taken into account when making investment decisions, metrics which are commonly used by global SaaS companies.

54

Average Revenue per Paying User (ARPPU)

Marginal Costs per Paying User• Expenses required

to retain existing paying users

Customer Acquisition Cost (CAC)

MRR Churn Rate• MRR from existing user from previous month vs total

MRR in previous month• We have negative churn as the MRR gained from up-

or cross-selling is more than the MRR lost due to cancellation

Payback Period (month)• Period required for recovering the

cost of acquiring each new customer

Cumulative Earnings

※ For illustrative purpose only and not to size.

55FY11/19 Q2 Financial Summary

FY11/19 Q2 (2019/3-2019/5) FY11/19 Q2 YTD (2018/12-2019/5)

Actual

FY11/18 Q2 FY11/19 Q1

Actual

FY11/18 Q2 YTDFY11/19 Full-year

Forecast (lower end)

(¥ mn) Actual YoY% Actual QoQ% Actual YoY% Actual Progress

Net Sales 1,661 1,091 +52.3% 1,398 +18.9% 3,059 1,997 +53.2% 7,122 42.9%

Business 919 599 +53.3% 853 +7.8% 1,771 1,132 +56.4% 4,075 43.5%

Home 403 304 +32.5% 370 +8.9% 772 570 +35.6% 1,848 41.8%

X 263 178 +47.9% 125 +109.9% 388 279 +38.8% 860 45.1%

Finance 74 7 10.1x 48 1.6x 122 10 11.7x 339 35.9%

Other 3 2 +30.0% 2 +20.1% 5 5 +12.7% - -

Gross Profit 1,022 709 +44.3% 746 +37.0% 1,769 1,319 +34.1% - -

Gross Profit Margin 61.5% 65.0% △3.4pt 53.4% 8.1pt 57.8% 66.0% △8.2pt - -

EBITDA △525 △67 - △941 - △1,467 △161 - △2,420 60.6%

EBITDA (excl. advertising expenses) △246 47 - △374 - △621 100 - △1,031 60.2%

Products and Services

Money Forward Cloud Series - SaaS Platform 57

Money Forward Cloud Series is a SaaS platform for back office operations.

Tapping into the expanding cloud computing market, we provide products in the form of SaaS, reducing large initial investments that would otherwise be required.

We strive to provide the benefits of IT to businesses big and small.

Cloud Series

Cloud My NumberCloud InvoiceCloud Payroll

Cloud Tax ReturnCloud Accounting Cloud Expense

Cloud Finance Cloud Attendance

STREAMED - Cloud-based Bookkeeping Service 58

STREAMED is a cloud bookkeeping service, where operators promptly digitalize receipt data scanned by users. The service is provided by Klavis Inc., which joined the Group in November 2017.

Gathering evidence Importing data

User User

User scans receipts etc.

Operators digitalize the data within 1 business day*

User checksdata

User imports data to accounting software

** Data scanned during 10 am -7 pm of business day is digitalized within 1 business day.

59Manageboard - Cloud-based Business Analysis Tool

Improving operational efficiency Improving profitability

Accounting

processesData entry

Managerial

actionsBudget control

• AI-based audit (journal entries check)

• Automated data aggregation

• AI-based automated journal entries

• Visualization of financial data

• Budget control analysis

• Financial results forecast

• Cash flow forecast

• Budgeting and financing support

by Financial Strategy Advisers

Manageboard primarily offers functions which help SMEs improve their profitability.

Cloud Series

Sales Strategies Aligned with Customer Profiles 60

Accountants & their clients

CorporatesSole Proprietors(a) 31 or more

employees(b) 30 or less

employees

Primary Products

Accounting/Payroll/Attendance/STREAMED/

Manageboard

Expense/Payroll/Attendance

Business Plan Personal Plan

Distribution Field salesField sales/Inside sales

Mostly online(Inbound marketing)

Mostly online (Inbound marketing)

Price(Example)

(Monthly)Accounting ¥3,000STREAMED ¥12,000~MB ¥49,800~

Expense¥500/employeePayroll¥300/employee

Small BusinessMonthly: ¥3,980~Annual: ¥35,760~(¥2,980/month)

BusinessMonthly: ¥5,980~Annual: ¥59,760~(¥4,980/month)

Personal LightMonthly: ¥1,280~Annual:¥11,760~(¥980/month)

PersonalMonthly: ¥2,480~Annual: ¥23,760~(¥1,980/month)

MarketingSales visits through

field sales/Events and seminars

Sales visitsthrough field sales/ Phone calls through

inside sales/Events and seminars

Online ads/SEO/

Organic marketing

Online ads/SEO/

Organic marketing

61Money Forward ME - Automated PFM Service

Money Forward ME is the No.1 PFM app in Japan*1, reaching 8 million users. One in four PFM app users are using Money Forward.

61

No.1 coverage*2: integrates 2,600+ financial services/Automatically creates household accounting books by

aggregating multiple accounts

Credit card

Bank

Electronic money

PensionMobile phone

Online shopping

Miles

Securities

Connects Automatically classifies

Visualizes

No. of users and market share*1

No. of users

Market share

※1 Rakuten Insight, Inc., “PFM app currently used” (Mar. 23 to 27, 2017) Survey targets: 685 PFM app users in their 20s to 60s※2 Based on research by Money Forward, Inc. as of May 31, 2019

62MONEY PLUS - Practical Economic Media

MONEY PLUS delivers information on how to use money wisely as a tool to enrich one’s lives. Readers are encouraged to familiarize themselves with money and finance, a topic often considered complex.

62

A practical economic media that enriches readers’ lives now and in the future

63Money Forward Mall

Platform for comparing and applying for financial services such as credit cards and securities accounts.

63

64SiraTama - Savings App that Makes Life More Fun

SiraTama is an automatic savings app that enables users to effortlessly (“sira”zu) build their savings (“tama”ru).

64

65tock pop - Coupon App

tock pop is a coupon app which offers rewards and discount coupons for restaurants and retail stores, as well as fitness and leisure facilities.

65

Coupons available for the following stores and more!

6666MF KESSAI - Online Invoicing and Factoring Services

MF KESSAI is a business process outsourcing and factoring service.

2. Assignment of accounts receivable

5.Guaranteed payment

Insurance Company

1. Sale of Goods

3. Invoicing

4. Collection of funds

Insurance Fees

Insurance Coverage

Seller Buyer

Credit Screening

Revenue

67Alliance with Financial Institutions (APIs)

We are the most API-connected platform in Japan, in both Referential APIs and Money Transfer APIs. The Japanese Government targets the adoption of open banking APIs by 80+ banks by 2020.

67

*Red indicates additions from the FY11/19 Q1 presentation.

Financial InstitutionFor consumers For business

ReferentialMoney transfer


1 SBI Sumishin Net Bank ✓ ✓ ✓ ✓

2 Shizuoka Bank ✓

3 Gunma Bank ✓ ✓

4 Mizuho Bank ✓ ✓

5 Seven Bank ✓ ✓ ✓

6 Aichi Bank ✓ ✓

7Sumitomo Mitsui Banking Corporation

✓ ✓ ✓

8 Minato Bank ✓

9 Japan Net Bank ✓ ✓

10 Michinoku Bank ✓

11 MUFG Bank ✓ ✓ ✓

12 Tochigi Bank ✓

13 Chiba Bank ✓ ✓

14 North Pacific Bank ✓

15 Taiko Bank ✓

16 Keiyo Bank ✓ ✓

17 Iyo Bank ✓

18 Daishi Bank ✓

19 Kita Kyushu Bank ✓

20 Momiji Bank ✓

Financial Institution

For consumers For business



21 Yamaguchi Bank ✓

22 Jibun Bank ✓

23 Chugoku Bank ✓

24 Toho Bank ✓

25 Ashikaga Bank ✓

26 Kumamoto Bank ✓ ✓ ✓

27 Shinwa Bank ✓ ✓ ✓

28 Bank of Fukuoka ✓ ✓ ✓

29 Sendai Bank ✓

30 Hokuriku Bank ✓

31 Kyoto Shinkin Bank ✓ ✓

32 Shiga Bank ✓

33 JA Bank ✓

34 Sony Bank ✓

35 Daiwa Next Bank ✓

36 Chikuho Bank ✓ ✓

37 Akita Bank ✓

38 Musashino Bank ✓

39 Shizuoka Chuo Bank ✓

40 Hiroshima Bank ✓

68

Money Forward for X SeriesDeveloping customizedMoney Forward ME for financial institutions and its clients.

Alliance with Financial Institutions (For Individuals) 68

Passbook AppsDeveloping passbook apps for financial institutions and its clients

MF Unit SeriesOffering PFM tools within financial institutions appsAsset Monitoring Unit

SBI Sumishin Net Bank

Yamaguchi FG

Shizuoka Bank

Tokai Tokyo Securities

Toho Bank

Gunma Bank

Shiga Bank

Fukui Bank

Okazaki Shinkin Bank

Michinoku Bank

Tsukuba Bank

Tokyo Star Bank

Sumitomo Mitsui Trust Bank

Sompo Japan Nipponkoa Himawari Life Insurance

Tochigi Bank

North Pacific Bank

Mizuho Bank

Gunma Bank

Toho Bank

Tochigi Bank

Taiko Bank

Tsukuba Bank

JAL Card

Taiko Bank

Michinoku Bank

Sendai BankLending Manager*

Advising loan amounts and repayment plans.

*Lending Manager is a trademark of NTT Docomo

JA Bank

Hokuriku Bank

Kyoto Shinkin Bank

North Pacific Bank

Chiba Bank

JA Bank

Shiga Bank

Daishi Bank

Akita Bank

Chugoku Bank

Alliance with Financial Institutions (For Corporates)

Money Forward Cloud Finance : Lending platform utilizing Money Forward Cloud data.

Money Forward Cloud Accounting/Tax Return for BANK: Accounting and Tax return preparation service for financial institution clients.

69

Money Forward Cloud Accounting/Tax Return for The Fukui Bank

Money Forward Cloud Tax Return for North Pacific Bank

GMO Epsilon Transaction Lending

GMO Epsilon

Fast Pass (Loan for SMEs)

The Bank of Fukuoka

Q-pit (Loan for SMEs)

The Fukui Bank

70

Disclaimer

The forward-looking statements and other contents included in this material are determined based on information currently available, and may be subject to change due to macro economic trends, changes in the market environment or industry in which the Group operates, or for other internal/external factors. Money Forward, Inc. shall not represent or warrant the accuracy or completeness of the information contained in this material.

This material is an excerpt translation of the original Japanese material and is only for reference purposes. In the event of any discrepancy between this translated material and the original Japanese material, the latter shall prevail.

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