<aside> <img src="/icons/calendar_green.svg" alt="/icons/calendar_green.svg" width="40px" /> This November 2023 update reviews our performance from October 2023.

You can expect to see our next update on December 20, 2023, reviewing performance for November 1-30th, 2023.

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<aside> 💡 After 12 months, all historic Investor Updates, Friday Forums, and other inside the company content can be found here:

Inside Levels - Friday Forums and Investor Updates

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Overview

Loom

https://www.loom.com/share/ce239d002d42430a9440aec78436b8ca

Letter

<aside> <img src="/icons/circle-dot_green.svg" alt="/icons/circle-dot_green.svg" width="40px" /> Levels Investors & Team –

Our goal for October was to shift our strategy to improving contribution margin and decreasing burn while we work on delivering a path to non-linear growth.

Through adjustments to our performance marketing spend, migration to new hardware with stronger unit economics, and overall efforts to improve operational efficiency, we were able to reach this goal ahead of target. Revenue reached an all-time high of $1.9M ($22.8M annualized) in October, and we were able to achieve a positive contribution margin of $143k.

Product & Engineering efforts to improve the Levels app experience continued with the release of Quick Logging, Levels Library, and overall performance improvements. This feature velocity comes off the heels of a few months of refactoring, maintenance, and bug fixing.

Within Operations, we’ve shifted a majority of our subscribing members to the latest available hardware, which comes with improvements to support, replacement rates, shipping spend, and overall product experience.

In Growth, we reduced our performance marketing spend by 80%, saving $100k and achieving a blended CAC of $96 for the month. This adjustment reduced lower intent top of funnel traffic and improved our overall blended conversion rate. Overall conversions were up for October, and we’ll continue to watch for any lagging impacts from this adjustment in performance marketing spend.

We continue to experiment with offering Monthly App Subscriptions to Levels (alongside our existing Annual offering) and are collecting cohort data on conversion rates (~65%), LTV, and CAC to determine long-term sustainability of a monthly offering. We’ll continue to explore how we can offer Levels at lower price-points as well as increase average order value by bundling offerings such as Labs.

<aside> <img src="/icons/arrow-right-basic_green.svg" alt="/icons/arrow-right-basic_green.svg" width="40px" /> Looking ahead to November:

We’re planning to run Early Bird + Black Friday campaigns, which have had historically strong performance. With feedback from previous years, we are also extending an offer to existing members (through a Labs offering).
We’ll continue to migrate existing members to the newer sensor hardware offering, further improving our unit economics and overall experience.
Our focus on Contribution Margin across the business will continue, but we expect more modest improvements as compared to October’s step change.
Our product development velocity and feature releases are expected to continue, with iterations on features that support Accountability, Logging, as well as in-app order management for CGM ordering, a long requested improvement. </aside>

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<aside> 🙏 Special thanks this month to Bucky Moore, Nick Krasney, Joey Roselli, Kyle Kallaway, Leah Brueggemann, George McGraw, Matthew Knight, and Shaun Arora.

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Table of Contents

Metrics

| | August 2023 Result | September 2023 Result | October 2023 Result | | --- | --- | --- | --- | | ⭐ Contribution Margin | ($91,430) | ($25,729) | $142,912 | | Total Revenue | $1,794,110 | $1,741,543 | $1,898,798 | | Burn Rate | ($886,275) | ($867,222) | ($526,672) | | Runway | 18 months | 17 months | 21 months | | New Customers | 1,556 | 1,551 | 1,549 | | Retention (Annual) | 21.8% | 25.0% | 25.6% | | Lifetime Value (LTV) | $252 | $233 | $199 | | Customer Acquisition Costs, Blended | $171 | $162 | $96 | | LTV/CAC | 1.5 | 1.4 | 2.1 |

Goals

| | September 2023 Result | October 2023 Objective | October 2023 Result | November 2023 Objective | | --- | --- | --- | --- | --- | | ⭐ Contribution Margin Owner: Growth, Ben | ($25,729) | $7,880 | $142,912 | $120,000 | | Total Revenue Owner: Growth, Ben | $1,794,110 | $1,841,469 | $1,898,798 | $1,824,002 | | Burn Rate Owner: Finance, Ryley | ($867,222) | ($1,000,000) | ($526,672) | ($800,000) | | Runway Owner: Finance, Ryley | 17 months | 16 months | 21 months | 20 months | | New Customers Owner: Growth, Ben | 1,551 | 1,551 | 1,549 | 1,551 | | 12-month Retention Owner: Product, Cosima | 25.0% | 23.0% | 25.6% | 23.0% | | Lifetime Value (LTV) Owner: Growth, Ben | $233 | $250 | $199 | $200 | | Customer Acquisition Cost, blended (CAC) Owner: Growth, Ben | $162 | $154 | $96 | $110 | | LTV/CAC (blended) Owner: Growth, Ben | 1.4 | 1.6 | 2.1 | 1.8 |