EVERCOMMERCE INC. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q)

Unless the context requires otherwise, references in this Quarterly Report on
Form 10-Q to "EverCommerce," the "Company," "we," "us" and "our" refer to
EverCommerce Inc. and its consolidated subsidiaries. The following discussion
and analysis of our financial condition and results of operations should be read
in conjunction with our unaudited condensed consolidated financial statements
and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and
our consolidated financial statements and related notes included in our Annual
Report on Form 10-K for the year ended December 31, 2021 (the "Annual Report on
Form 10-K"). Additionally, our historical results are not necessarily indicative
of the results that may be expected for any period in the future.

Insight

EverCommerce is a leading provider of integrated, vertically-tailored
software-as-a-service ("SaaS") solutions for service-based small- and
medium-sized businesses ("service SMBs"). Our platform spans across the full
lifecycle of interactions between consumers and service professionals with
vertical-specific applications. Today, we serve over 600,000 customers across
three core verticals: Home Services; Health Services; and Fitness & Wellness
Services. Within our core verticals, our customers operate within numerous
micro-verticals, ranging from home service professionals, such as home
improvement contractors and home maintenance technicians, to physician practices
and therapists within Health Services, to personal trainers and salon owners
within Fitness & Wellness. Our platform provides vertically-tailored SaaS
solutions that address service SMBs' increasingly specialized demands, as well
as highly complementary solutions that complete end-to-end offerings, allowing
service SMBs and EverCommerce to succeed in the market, and provide end
consumers more convenient service experiences.

We offer several vertically-tailored suites of solutions, each of which follows
a similar and repeatable go-to-market playbook: offer a "system of action"
Business Management Software that streamlines daily business workflows,
integrate highly complementary, value-add adjacent solutions and complete gaps
in the value chain to create end-to-end solutions. These solutions focus on
addressing how service SMBs market their services, streamline operations and
retain and engage their customers.

•Business Management Software: Our vertically-tailored Business Management
Software is the system of action at the center of a service business' operation,
and is typically the point-of-entry and first solution adopted by a customer.
Our software, designed to meet the day-to-day workflow needs of businesses in
specific vertical end markets, streamlines front and back-office processes and
provides polished customer-facing experiences. Using these offerings, service
SMBs can focus on growing their customers, improving their services and driving
more efficient operations.

•Billing & Payment Solutions: Our Billing & Payment Solutions provide integrated
payments, billing and invoicing automation and business intelligence and
analytics. Our omni-channel payments capabilities include point-of-sale,
eCommerce, online bill payments, recurring billing, electronic invoicing and
mobile payments. Supported payment types include credit card, debit card and
Automated Clearing House processing. Our payments platform also provides a full
suite of service commerce features, including customer management as well as
cash flow reporting and analytics. These value-add features help small- and
medium-sized businesses ("SMBs") to ensure more timely billing and payments
collection and provide improved cash flow visibility.

•Customer Experience Solutions: Our Customer Experience Solutions modernize how
businesses engage and interact with customers by leveraging innovative, bespoke
customer listening and communication solutions to improve the customer
experience and increase retention. Our software provides customer listening
capabilities with real-time customer surveying and analysis to allow standalone
businesses and multi-location brands to receive voice of the customer insights
and manage the customer experience lifecycle. These applications include:
customer health scoring, customer support systems, real-time alerts, NPS-based
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customer feedback collection, review generation and automation, reputation
management, customer satisfaction surveying and a digital communication suite,
among others. These tools help our customers gain actionable insights, increase
customer loyalty and repeat purchases and improve customer experiences.

•Marketing Technology Solutions: Our Marketing Technology Solutions work with
our Customer Experience Solutions to help customers build their businesses by
invigorating marketing operations and improving return on investment across the
customer lifecycle. These solutions help businesses to manage campaigns,
generate quality leads, increase conversion and repeat sales, improve customer
loyalty and provide a polished brand experience. Our solutions include: custom
website design, development and hosting, responsive web design, marketing
campaign design and management, search engine optimization ("SEO"), paid search
and display advertising, social media and blog automation, call tracking, review
monitoring and marketplace lead generation, among others.

We go to market with suites of solutions that are aligned to our three core
verticals: (i) the EverPro suite of solutions in Home Services; (ii) the
EverHealth suite of solutions within Health Services; and (iii) the EverWell
suite of solutions in Fitness & Wellness Services. Within each suite, our
Business Management Software - the system of action at the center of a service
business' operation - is typically the first solution adopted by a customer.
This vertically-tailored point-of-entry provides us with an opportunity to
cross-sell adjacent products, previously offered as fragmented and disjointed
point solutions by other software providers. This "land and expand" strategy
allows us to acquire customers with key foundational solutions and expand into
offerings via product development and acquisitions that cover all workflows and
power the full scope of our customers' businesses. This results in a
self-reinforcing flywheel effect, enabling us to drive value for our customers
and, in turn, improve customer stickiness, increase our market share and fuel
our growth.

We generate three types of revenue: (i) Subscription and Transaction Fees, which
are primarily recurring revenue streams, (ii) Marketing Technology Solutions,
which includes both recurring and re-occurring revenue streams and (iii) Other
revenue which consists primarily of one-time revenue streams. Our recurring
revenue generally consists of monthly, quarterly and annual software and
maintenance subscriptions, transaction revenue associated with integrated
payments and billing solutions and monthly contracts for Marketing Technology
Solutions. Additionally, our re-occurring revenue includes revenue related to
the sale of marketing campaigns and lead generation under contractual
arrangements with customers.

Our business benefits from attractive unit economics. Approximately 95% of our
revenue in the six months ended June 30, 2022 and 2021 was recurring or
re-occurring, and we maintained an annualized net revenue retention rate of more
than 100% for the quarter ended June 30, 2022. We believe the retention and
growth of revenue from our existing customers is a helpful measure of the health
of our business and our future growth prospects. Our ability to cross sell
additional products and services to our existing customers can increase customer
engagement with our suite of solutions and thus have a positive impact on our
net pro forma revenue retention rate. For example, we have leveraged our land
and expand strategy to cross sell solutions to our existing customers, which has
supported our high net pro forma revenue retention rate by increasing customer
utilization of our solutions, educating customers as to how our platform and
synergies can support their businesses and, in turn, improving customer
stickiness.

Our calculation of net pro forma revenue retention rate remains consistent with
prior periods. This rate for any fiscal period includes the positive recurring
and re-occurring revenue impacts of selling new solutions to existing customers
and the negative impacts of contraction and attrition among this set of
customers. Our net pro forma revenue retention rate may fluctuate as a result of
a number of factors, including the growing level of our revenue base, the level
of penetration within our customer base, expansion of solutions, new
acquisitions and our ability to retain our customers. Our calculation of net pro
forma revenue retention rate may differ from similarly titled metrics presented
by other companies.

We acquire businesses to deepen our competitive moat in existing verticals, and enter new verticals and

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geographies. We have acquired 52 companies since our inception. We have an
established framework for identification, execution, integration, and onboarding
of targets, which leverages our significant acquisition experience and utilizes
internal criteria for evaluating acquisition candidates and prospective
businesses. We have developed and refined our internal criteria over time with
our acquisitions, which has helped us to more readily identify attractive and
complementary targets that can be efficiently onboarded. These acquired
solutions can bring deep industry expertise and vertically-tailored software
solutions that provide additional sources of growth. We believe that our
methodology, track record, and reputation for sourcing, evaluating, and
integrating acquisitions positions us as an "acquirer-of-choice" for potential
targets.

Impact of COVID-19

The COVID-19 pandemic has caused economies, businesses, markets and communities
around the globe to be disrupted, and in many cases, shut-down. In the interest
of public health, many governments closed physical stores and business locations
deemed to be non-essential, which caused increased unemployment levels and
businesses to permanently close. Many SMBs have been adversely impacted by the
COVID-19 pandemic, and as a result, certain of our business operations were
negatively impacted, while others have benefited from customers shifting to
technology-focused, digital-first business models. A McKinsey survey from
October 2020 revealed that global business executives have accelerated the
digitization of their customer and supply-chain interactions by as much as three
to four years. Although we cannot predict the COVID-19 pandemic's future impacts
on the global economy, we believe that our business is well positioned to be a
partner-of-choice for new customers, to capitalize on the growing trend of
digital transformation and to benefit from the revival of the SMB economy.

Given that the COVID-19 pandemic continues to evolve, the extent to which it may
further impact our financial condition, results of operations, or liquidity
continues to be uncertain and difficult to predict. Any further impact is likely
to vary by specific verticals, solutions and geographies, with the diversity of
our customer base potentially moderating the overall effect. For more
information regarding the potential impact of the COVID-19 pandemic on our
business, refer to Part II. Item 1A. "Risk Factors-Risks Related to our
Business-The outbreak of the novel strain of coronavirus disease has impacted,
and a future pandemic, epidemic or outbreak of an infectious disease in the
United States could impact, our business, financial condition and results of
operations, as well as the business or operations of third parties with whom we
conduct business."

Key factors affecting our performance

We believe that our performance and future success depends on a number of
factors that present significant opportunities for us but also pose risks and
challenges. For discussion of these factors, please see "Key Factors Affecting
Our Performance" in the Management's Discussion and Analysis section of our
Annual Report on Form 10-K.

Main commercial and financial parameters

In addition to our results and measures of performance determined in accordance
with GAAP, we believe the following key business and non-GAAP financial measures
are useful in evaluating and comparing our financial and operational performance
over multiple periods, identifying trends affecting our business, formulating
business plans and making strategic decisions.

Pro forma revenue growth rate

Pro Forma Revenue Growth Rate is a key performance measure that our management
uses to assess our consolidated operating performance over time. Management also
uses this metric for planning and forecasting purposes.

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Our year-over-year Pro Forma Revenue Growth Rate is calculated as though all
acquisitions closed as of the end of the latest period were closed as of the
first day of the prior year period presented. In calculating Pro Forma Revenue
Growth Rate, we add the revenue from acquisitions for the reporting periods
prior to the date of acquisition (including estimated purchase accounting
adjustments) to our results of operations, and then calculate our revenue growth
rate between the two reported periods. As a result, Pro Forma Revenue Growth
Rate includes pro forma revenue from businesses acquired during the period,
including revenue generated during periods when we did not yet own the acquired
businesses. In including such pre-acquisition revenue, Pro Forma Revenue Growth
Rate allows us to measure the underlying revenue growth of our business as it
stands as of the end of the respective period, which we believe provides insight
into our then-current operations. Pro Forma Revenue Growth Rate does not
represent organic revenue generated by our business as it stood at the beginning
of the respective period. Pro Forma Revenue Growth Rates are not necessarily
indicative of either future results of operations or actual results that might
have been achieved had the acquisitions been consummated on the first day of the
prior year period presented. We believe that this metric is useful to investors
in analyzing our financial and operational performance period over period and
evaluating the growth of our business, normalizing for the impact of
acquisitions. This metric is particularly useful to management due to the number
of acquired entities.

Our Pro Forma Revenue Growth rate was 16.1% and 18.0% for the three and six
months ended June 30, 2022, respectively, reflective of the underlying growth in
our business including new customers and providing more solutions to existing
customers.

Non-GAAP Financial Measures

Adjusted Gross Profit

Adjusted Gross Profit is a key performance measure that our management uses to
assess our operational performance, as it represents the results of revenues and
direct costs, which are key components of our operations. We believe that this
non-GAAP financial measure is useful to investors and other interested parties
in analyzing our financial performance because it reflects the gross
profitability of our operations, and excludes the indirect costs associated with
our sales and marketing, product development, general and administrative
activities and depreciation and amortization, and the impact of our financing
methods and income taxes.

We calculate Adjusted Gross Profit as gross profit (as defined below) adjusted
to exclude depreciation and amortization allocated to cost of revenues. Adjusted
Gross Profit should be viewed as a measure of operating performance that is a
supplement to, and not a substitute for, operating income or loss, net earnings
or loss and other GAAP measures of income (loss) or profitability. The following
table presents a reconciliation of gross profit, the most directly comparable
financial measure calculated in accordance with GAAP, to Adjusted Gross Profit
on a consolidated basis.

                                     Three months ended                   Six months ended
                                          June 30,                            June 30,
                                    2022              2021             2022              2021
                                                         (in thousands)

Gross profit (1)                $   96,542   (2)   $ 75,521   (3)   $ 183,820   (4)   $ 140,166   (5)
Depreciation and amortization        5,601            4,673            11,154             9,260
Adjusted gross profit           $  102,143         $ 80,194         $ 194,974         $ 149,426



(1)Gross profit is calculated as total revenues less cost of revenues (exclusive
of depreciation and amortization), amortization of developed technology,
amortization of capitalized software and depreciation expense (allocated to cost
of revenues).
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(2)For the three months ended June 30, 2022, gross profit represents total
revenues of $157.2 million less cost of revenues (exclusive of depreciation and
amortization) of $55.1 million, amortization of developed technology of $4.1
million, amortization of capitalized software of $1.2 million and depreciation
expense (allocated to cost of revenues) of $0.3 million.
(3)For the three months ended June 30, 2021, gross profit represents total
revenues of $121.1 million less cost of revenues (exclusive of depreciation and
amortization) of $40.9 million, amortization of developed technology of $3.5
million, amortization of capitalized software of $0.8 million and depreciation
expense (allocated to cost of revenues) of $0.4 million.
(4)For the six months ended June 30, 2022, gross profit represents total
revenues of $300.8 million less cost of revenues (exclusive of depreciation and
amortization) of $105.8 million, amortization of developed technology of $8.3
million, amortization of capitalized software of $2.3 million and depreciation
expense (allocated to cost of revenues) of $0.6 million.
(5)For the six months ended June 30, 2021, gross profit represents total
revenues of $226.0 million less cost of revenues (exclusive of depreciation and
amortization) of $76.5 million, amortization of developed technology of $6.9
million, amortization of capitalized software of $1.6 million and depreciation
expense (allocated to cost of revenues) of $0.8 million.

Adjusted EBITDA

Adjusted EBITDA is a key performance measure that our management uses to assess
our financial performance and is also used for internal planning and forecasting
purposes. We believe that this non-GAAP financial measure is useful to investors
and other interested parties in analyzing our financial performance because it
provides a comparable overview of our operations across historical periods. In
addition, we believe that providing Adjusted EBITDA, together with a
reconciliation of net loss to Adjusted EBITDA, helps investors make comparisons
between our company and other companies that may have different capital
structures, different tax rates and/or different forms of employee compensation.

Adjusted EBITDA is used by our management team as an additional measure of our
performance for purposes of business decision-making, including managing
expenditures, and evaluating potential acquisitions. Period-to-period
comparisons of Adjusted EBITDA help our management identify additional trends in
our financial results that may not be shown solely by period-to-period
comparisons of net income or income from continuing operations. In addition, we
may use Adjusted EBITDA in the incentive compensation programs applicable to
some of our employees. Our Management recognizes that Adjusted EBITDA has
inherent limitations because of the excluded items, and may not be directly
comparable to similarly titled metrics used by other companies.

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We calculate Adjusted EBITDA as net loss adjusted to exclude interest and other
expense, net, income tax (benefit) expense, depreciation and amortization, other
amortization, acquisition related costs, stock-based compensation, and other
non-recurring costs. Other amortization includes amortization for capitalized
contract acquisition costs. Acquisition related costs are specific deal-related
costs such as legal fees, financial and tax due diligence, consulting and escrow
fees. Other non-recurring costs are expenses such as system implementation costs
and severance related to planned restructuring activities. Acquisition related
costs and other non-recurring costs are excluded as they are not representative
of our underlying operating performance. Adjusted EBITDA should be viewed as a
measure of operating performance that is a supplement to, and not a substitute
for, operating income or loss, net earnings or loss and other GAAP measures of
income (loss). The following table presents a reconciliation of net loss, the
most directly comparable financial measure calculated in accordance with GAAP,
to Adjusted EBITDA on a consolidated basis.

                                         Three months ended             Six months ended
                                              June 30,                      June 30,
                                        2022           2021           2022           2021
                                                          (in thousands)

Net loss                             $ (12,881)     $ (24,334)     $ (26,190)     $ (40,329)
Adjusted to exclude the following:
Interest and other expense, net          6,702         13,165         12,180         26,114
Income tax (benefit) expense                75            367         (5,662)        (3,160)

Depreciation and amortization           27,520         24,224         54,911         47,921
Other amortization                       1,028            677          1,970          1,277
Acquisition related costs                   44          1,142            641          2,240
Stock-based compensation expense         6,508         11,201         12,643         12,104
Other non-recurring costs                1,753          1,131          3,218          2,716
Adjusted EBITDA                      $  30,749      $  27,573      $  53,711      $  48,883

Description of certain components of financial data

Revenue

We derive our revenue from three primary sources which are described in detail
below: (i) Subscription and Transaction Fees, which are primarily recurring
revenue streams, (ii) Marketing Technology Solutions, which includes both
recurring and re-occurring revenue streams and (iii) Other revenue, which
consists primarily of the sale of distinct professional services and hardware.
Our revenue recognition policies are discussed in more detail under "Critical
Accounting Policies and Significant Judgments and Estimates."

Subscription and Transaction Fees: Revenue includes (i) recurring monthly,
quarterly and annual SaaS subscriptions and software license and maintenance
fees from the sale of our Business Management, Customer Experience and Billing
and Payment solutions; (ii) payment processing fees based on the transaction
volumes processed through our integrated payment solutions and processing fees
based on transaction volumes for our revenue cycle management, chronic care
management and health insurance clearinghouse solutions and (iii) membership
subscriptions and our share of rebates from suppliers generated though group
purchasing programs. Our revenue from payment processing fees is recorded net of
credit card and ACH processing and interchange charges in the month the services
are performed.

Marketing Technology Solutions: Revenue includes (i) recurring revenue for managing digital advertising programs on behalf of our clients, including website hosting, search engine management and optimization, media social

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blog management and automation; and (ii) recurring fees paid by service professionals for leads generated through our various platforms.

Other: Revenue includes (i) consulting, implementation, training and other professional services; (ii) website development; (iii) income from various business development partnerships; (iv) event revenue; and (v) hardware sales related to our business management or payment software solutions.

Revenue cost

Cost of revenue (exclusive of depreciation and amortization) consists of
expenses related to delivering our services and products and providing support
to our customers and includes employee costs and related overhead, customer
credit card processing fees, targeted mail costs, third party fulfillment costs
and software hosting expenses.

We expect that cost of revenue as a percentage of revenue will fluctuate from
period to period based on a variety of factors, including the mix of revenue
between Subscription and Transaction Fees and Marketing Technology Solutions,
labor costs, third-party expenses and acquisitions. In particular, Marketing
Technology Solutions revenue generally has a higher cost of revenue as a
percentage of revenue than our Subscription and Transaction Fee revenue. For the
three and six months ended June 30, 2022, revenue from Subscription and
Transaction Fees increased 35.8% and 39.5% compared to the three and six months
ended June 30, 2021, respectively, whereas Marketing Technology Solutions
revenue increased 10.0% and 13.4%, respectively. To the extent our Marketing
Technology Solutions revenue grows at a faster rate, whether by acquisition or
otherwise, than our Subscription and Transaction Fees revenue, it could
negatively impact our cost of revenues as a percentage of revenue.

Sales and Marketing

Sales and marketing expense consist primarily of employee costs for our sales
and marketing personnel, including salaries, benefits, bonuses, stock based
compensation and sales commissions. Sales and marketing expenses also include
advertising costs, travel-related expenses and costs to market and promote our
products, direct customer acquisition costs, costs related to conferences and
events and partner/broker commissions. Software and subscription services
dedicated for use by our sales and marketing organization, and outside services
contracted for sales and marketing purposes are also included in sales and
marketing expense. Sales commissions that are incremental to obtaining a
customer contract are deferred and amortized ratably over the estimated period
of our relationship with that customer. We expect our sales and marketing
expenses will increase on an absolute dollar basis for the foreseeable future as
we continue to increase investments to support our growth. We also anticipate
that sales and marketing expenses will increase as a percentage of revenue in
the near and medium-term.

Product Development

Product development expense consists primarily of employee costs for our product
development personnel, including salaries, benefits, stock-based compensation
and bonuses. Product development expenses also include third-party outsourced
technology costs incurred in developing our platforms, and computer equipment,
software and subscription services dedicated for use by our product development
organization. We expect our product development expenses to increase in absolute
dollars and remain generally consistent as a percentage of revenue for the
foreseeable future as we continue to dedicate substantial resources to develop,
improve and expand the functionality of our solutions.

General and administrative

General and administrative expense consists of employee costs for our executive
leadership, accounting, finance, legal, human resources and other administrative
personnel, including salaries, benefits, bonuses and stock-based compensation.
General and administrative expenses also include external legal, accounting and
other professional
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services fees, rent, software and subscription services dedicated for use by our
general and administrative employees and other general corporate expenses. We
expect general and administrative expense to increase on an absolute dollar
basis for the foreseeable future as we continue to increase investments to
support our growth and due to increased costs as a result of being a public
company. As we are able to further scale our operations in the future, we would
expect that general and administrative expenses would decrease as a percentage
of revenue.

Depreciation and amortization

Depreciation allowances mainly relate to intangible fixed assets, tangible fixed assets and capitalized software.

Interest and other charges, net

Interest and other expense, net, primarily includes interest expense on long-term debt, net of interest income. It also includes the amortization expense of financing costs and discounts, as well as realized and unrealized gains and losses.

Tax benefit (expense)

We account for income taxes in accordance with ASC 740, Income Taxes. ASC 740
requires deferred tax assets and liabilities to be recognized for temporary
differences between the tax basis and financial reporting basis of assets and
liabilities, computed at the expected tax rates for the periods in which the
assets or liabilities will be realized, as well as for the expected tax benefit
(expense) of net operating loss and tax credit carryforwards. Income taxes are
recognized for the amount of taxes payable by the Company's corporate
subsidiaries for the current year and for the impact of deferred tax assets and
liabilities, which represent future tax consequences of events that have been
recognized differently in the financial statements than for tax purposes.

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Operating results

The following tables summarize key components of our results of operations for
the periods presented. The period-to-period comparisons of our historical
results are not necessarily indicative of the results that may be expected in
the future. We operate as a single reportable segment to reflect the way our
chief operating decision maker ("CODM") reviews and assesses the performance of
our business. For additional information concerning our accounting policies, see
Note 2 to our consolidated financial statements included in our Annual Report on
Form 10-K.

Impact of Acquisitions

The comparability of our operating results is impacted by our business
combinations and acquisitions. In our discussion of changes in our results of
operations for the three and six months ended June 30, 2022 compared to the
three and six months ended June 30, 2021, we quantitatively disclose the impact
of the growth in certain of our revenues where such discussions would be
meaningful. Expense contributions from our recent acquisitions for each of the
respective period comparisons generally were not separately identifiable due to
the integration of these businesses into our existing operations, and as such
the discussion is focused on major changes in components of costs.

Comparison of three and six months ended June 30, 2022 and 2021

                                                        Three months ended                     Six months ended
                                                             June 30,                              June 30,
                                                      2022               2021               2022               2021
                                                                             (in thousands)

Income:

Subscription and transaction fees                 $ 115,648          $  85,136          $ 223,649          $ 160,331
Marketing technology solutions                       35,160             31,976             65,064             57,364
Other                                                 6,438              3,938             12,109              8,261
Total revenues                                      157,246            121,050            300,822            225,956
Operating expenses:
Cost of revenues (1) (exclusive of depreciation
and amortization presented separately below)         55,103             40,856            105,848             76,530
Sales and marketing (1)                              29,946             22,802             60,091             42,491
Product development (1)                              17,423             12,047             35,060             22,372
General and administrative (1)                       33,358             31,923             64,584             54,017
Depreciation and amortization                        27,520             24,224             54,911             47,921
Total operating expenses                            163,350            131,852            320,494            243,331
Operating loss                                       (6,104)           (10,802)           (19,672)           (17,375)
Interest and other expense, net                      (6,702)           (13,165)           (12,180)           (26,114)

Net loss before income tax benefit (expense)        (12,806)           (23,967)           (31,852)           (43,489)
Income tax benefit (expense)                            (75)              (367)             5,662              3,160
Net loss                                          $ (12,881)         $ (24,334)         $ (26,190)         $ (40,329)



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(1)Includes stock-based compensation expense as follows:

                                             Three months ended            Six months ended
                                                  June 30,                     June 30,
                                             2022           2021          2022          2021
                                                             (in thousands)

Cost of revenues                         $       87      $      4      $    169      $      5
Sales and marketing                             419           113           747           142
Product development                             496           105           888           138
General and administrative                    5,506        10,979        10,839        11,819
Total stock-based compensation expense   $    6,508      $ 11,201      $ 12,643      $ 12,104



Revenues

                                        Three months ended
                                             June 30,                     Change
                                       2022           2021          Amount          %
                                                   (dollars in thousands)

Revenues:

Subscription and transaction fees $115,648 $85,136 $30,512

       35.8  %
Marketing technology solutions         35,160         31,976         3,184        10.0  %
Other                                   6,438          3,938         2,500        63.5  %
Total revenues                      $ 157,246      $ 121,050      $ 36,196        29.9  %


                                         Six months ended
                                             June 30,                     Change
                                       2022           2021          Amount          %
                                                   (dollars in thousands)

Revenues:

Subscription and transaction fees $223,649 $160,331 $63,318

       39.5  %
Marketing technology solutions         65,064         57,364         7,700        13.4  %
Other                                  12,109          8,261         3,848        46.6  %
Total revenues                      $ 300,822      $ 225,956      $ 74,866        33.1  %



Revenues increased $36.2 million or 29.9% and $74.9 million or 33.1% for the
three and six months ended June 30, 2022, respectively, as compared to the
corresponding periods in 2021. These increases were primarily driven by
increases in Subscription and Transaction Fees of $30.5 million and $63.3
million, respectively, and Marketing Technology Solutions of $3.2 million and
$7.7 million, respectively. The increases in Subscription and Transaction Fees
related to growth in our customer base, higher transaction volumes processed
through our payments platform and revenue earned from acquisitions completed in
2021. The increases in Marketing Technology Solutions related to growth in
customers using our digital marketing applications and an increase in consumer
leads generated by our platforms. Included in revenues for the three and six
months ended June 30, 2022 is $17.7 million and $34.8 million, respectively, of
revenue from acquisitions closed subsequent to June 30, 2021.
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Cost of Revenues

                                                      Three months ended
                                                           June 30,                                Change
                                                    2022               2021              Amount                %
                                                                        (dollars in thousands)

Cost of revenues (exclusive of depreciation and
amortization presented separately below)        $  55,103          $  40,856          $  14,247                 34.9  %
Percentage of revenues                               35.0  %            33.8  %


                                                       Six months ended
                                                           June 30,                                Change
                                                    2022               2021              Amount                %
                                                                        (dollars in thousands)

Cost of revenues (excluding depreciation shown separately below) $105,848 $76,530 $29,318

                 38.3  %
Percentage of revenues                               35.2  %            33.9  %



Cost of revenues increased by $14.2 million or 34.9% and $29.3 million or 38.3%
for the three and six months ended June 30, 2022, respectively, as compared to
the corresponding periods in 2021. These increases are primarily comprised of an
additional $3.9 million and $8.1 million of media spend, respectively, $2.0
million and $4.9 million of personnel and compensation expense, respectively,
$2.2 million and $4.9 million of outsourced services, respectively, and $2.3
million and $3.8 million of application programming interface fees,
respectively. As a percentage of revenue, cost of revenues was 35.0% and 33.8%
for the three months ended June 30, 2022 and 2021, respectively, and 35.2% and
33.9% for the six months ended June 30, 2022 and 2021, respectively.

Sales and Marketing

                             Three months ended
                                  June 30,                     Change
                            2022           2021         Amount          %
                                        (dollars in thousands)

Sales and marketing      $ 29,946       $ 22,802       $ 7,144        31.3  %
Percentage of revenues       19.0  %        18.8  %


                              Six months ended
                                  June 30,                     Change
                            2022           2021          Amount          %
                                        (dollars in thousands)

Sales and marketing      $ 60,091       $ 42,491       $ 17,600        41.4  %
Percentage of revenues       20.0  %        18.8  %



Sales and marketing expenses increased by $7.1 million or 31.3% and $17.6
million or 41.4% for the three and six months ended June 30, 2022, respectively,
as compared to the corresponding periods in 2021. These increases were primarily
driven by an additional $3.3 million and $9.4 million of personnel and
compensation expense,
                                       34
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respectively, $1.2 million and $3.0 million of advertising spend, respectively,
and $1.0 million and $1.6 million of conference expense, respectively, due to
the continued investment in growth through personnel and various marketing
channels. As a percentage of revenue, sales and marketing was 19.0% and 18.8%
for the three months ended June 30, 2022 and 2021, respectively, and 20.0% and
18.8% for the six months ended June 30, 2022 and 2021, respectively.

Product Development

                             Three months ended
                                  June 30,                     Change
                            2022           2021         Amount          %
                                        (dollars in thousands)

Product development      $ 17,423       $ 12,047       $ 5,376        44.6  %
Percentage of revenues       11.1  %        10.0  %


                              Six months ended
                                  June 30,                     Change
                            2022           2021          Amount          %
                                        (dollars in thousands)

Product development      $ 35,060       $ 22,372       $ 12,688        56.7  %
Percentage of revenues       11.7  %         9.9  %



Product development expenses increased by $5.4 million or 44.6% and $12.7
million or 56.7% for the three and six months ended June 30, 2022, respectively,
as compared to the corresponding periods in 2021. These increases were primarily
driven by additional product development-related personnel expenses of $3.4
million and $9.6 million, respectively, as a result of investments in our
technology teams to support our various solutions as well as centralized
security operations, information technology and cloud engineering. As a
percentage of revenue, product development expenses were 11.1% and 10.0% for the
three months ended June 30, 2022 and 2021, respectively, and 11.7% and 9.9% for
the six months ended June 30, 2022 and 2021, respectively.

General and Administrative

                                 Three months ended
                                      June 30,                    Change
                                2022           2021         Amount         %
                                           (dollars in thousands)

General and administrative   $ 33,358       $ 31,923       $ 1,435       4.5  %
Percentage of revenues           21.2  %        26.4  %


                                       35
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                                  Six months ended
                                      June 30,                     Change
                                2022           2021          Amount          %
                                            (dollars in thousands)

General and administrative   $ 64,584       $ 54,017       $ 10,567        19.6  %
Percentage of revenues           21.5  %        23.9  %



General and administrative expenses increased by $1.4 million or 4.5% and $10.6
million or 19.6% for the three and six months ended June 30, 2022, respectively,
as compared to the corresponding periods in 2021. These increases were primarily
driven by an additional $2.2 million and $4.2 million of personnel and
compensation expense, respectively, $0.9 million and $1.9 million of insurance
expense, respectively, $0.8 million and $1.2 million of travel expense,
respectively, and other miscellaneous expenses, including but not limited to,
software subscription costs and professional fees. These costs increased due to
the continued investment in infrastructure required to support our rapid growth,
scalable operations and being a public company. These increases were partially
offset by decreases of $5.5 million and $1.0 million of stock-based compensation
expense. As a percentage of revenue, general and administrative expenses were
21.2% and 26.4% for the three months ended June 30, 2022 and 2021, respectively,
and 21.5% and 23.9% for the six months ended June 30, 2022 and 2021,
respectively.

Depreciation and amortization

                                    Three months ended
                                         June 30,                     Change
                                   2022           2021         Amount          %
                                               (dollars in thousands)

Depreciation and amortization $27,520 $24,224 $3,296

 13.6  %
Percentage of revenues              17.5  %        20.0  %


                                     Six months ended
                                         June 30,                     Change
                                   2022           2021         Amount          %
                                               (dollars in thousands)

Depreciation and amortization $54,911 $47,921 $6,990

 14.6  %
Percentage of revenues              18.3  %        21.2  %



Depreciation and amortization increased by $3.3 million or 13.6% and $7.0
million or 14.6% for the three and six months ended June 30, 2022, respectively,
as compared to the corresponding periods in 2021. These increases were primarily
driven by an additional $2.8 million and $6.0 million, respectively, in
intangible assets' amortization as a result of intangible asset additions from
our 2021 acquisitions. As a percentage of revenue, depreciation and amortization
expenses were 17.5% and 20.0% for the three months ended June 30, 2022 and 2021,
respectively, and 18.3% and 21.2% for the six months ended June 30, 2022 and
2021, respectively.
                                       36
--------------------------------------------------------------------------------

Interest and other charges, net

                                      Three months ended
                                           June 30,                     Change
                                     2022           2021          Amount          %
                                                 (dollars in thousands)

Interest and other charges, net $6,702 $13,165 ($6,463)

   (49.1) %
Percentage of revenues                 4.3  %        10.9  %


                                       Six months ended
                                           June 30,                      Change
                                     2022           2021          Amount           %
                                                  (dollars in thousands)

Interest and other charges, net $12,180 $26,114 ($13,934)

    (53.4) %
Percentage of revenues                 4.0  %        11.6  %



Interest and other expense, net, decreased by $6.5 million or 49.1% and $13.9
million or 53.4% for the three and six months ended June 30, 2022, respectively,
as compared to the corresponding periods in 2021. These decreases were primarily
due to an overall lower outstanding debt balance in 2022 compared to 2021, as
well as a lower effective interest rate. As a percentage of revenue, interest
and other expense were 4.3% and 10.9% for the three months ended June 30, 2022
and 2021, respectively, and 4.0% and 11.6% for the six months ended June 30,
2022 and 2021, respectively.

Income Tax Benefit (Expense)

                               Three months ended
                                    June 30,                      Change
                             2022               2021        Amount         %
                                         (dollars in thousands)

Income tax expense       $    (75)            $ (367)      $ (292)      (79.6) %
Percentage of revenues          -   %           (0.3) %


                             Six months ended
                                 June 30,                    Change
                            2022          2021        Amount          %
                                       (dollars in thousands)

Income tax benefit       $ 5,662       $ 3,160       $ 2,502        79.2  %
Percentage of revenues       1.9  %        1.4  %



Income tax expense decreased by $0.3 million or 79.6% for the three months ended
June 30, 2022 and the income tax benefit increased by $2.5 million or 79.2% for
the six months ended June 30, 2022 as compared to the corresponding periods in
2021. The increase for the six months ended June 30, 2022 was primarily driven
by discrete items, including a California law change and an intercompany
intellectual property sale.

                                       37
--------------------------------------------------------------------------------

Cash and capital resources

To date, our primary sources of cash have been net cash provided by operating activities, proceeds from equity issuances and proceeds from long-term debt.

Our primary use of liquidity has been acquisitions of businesses. For a
description of our recent acquisitions, see Note 3 in the notes to the unaudited
condensed consolidated financial statements included in this Quarterly Report on
Form 10-Q. Absent significant deterioration of market conditions, we expect that
working capital requirements, capital expenditures, acquisitions, the Company's
stock repurchase program (discussed below), debt servicing and lease obligations
will be our principal needs for liquidity going forward. During the year ended
December 31, 2021, we completed five acquisitions for total consideration of
$367.1 million.

As of June 30, 2022, we had cash, cash equivalents and restricted cash of $109.1
million, $190.0 million of available borrowing capacity under our Revolver (as
defined below) and $545.9 million outstanding under our Term Loans (as defined
below). We believe that our existing cash, cash equivalents and restricted cash,
availability under our Credit Facilities, and our cash flows from operations
will be sufficient to fund our working capital requirements and planned capital
expenditures, and to service our debt obligations for at least the next twelve
months. However, our future working capital requirements will depend on many
factors, including our rate of revenue growth, the timing and size of future
acquisitions, and the timing of introductions of new products and services. We
expect to consummate acquisitions of complementary businesses in the future that
could require us to seek additional equity or debt financing. Market and
macroeconomic conditions may, from time to time, impact our ability to raise
capital. If we are unable to raise additional funds when desired, our business,
financial condition and results of operations could be adversely affected. See
Part II, Item 1A."Risk Factors."

Cash flow

The following table sets forth cash flow data for the periods indicated therein:

                                                                 Six months ended
                                                                     June 30,
                                                                2022          2021
                                                                  (in thousands)

Net cash provided by operating activities                    $ 24,002      $   3,832
Net cash used in investing activities                          (9,057)      

(75,825)

Net cash provided by (used in) financing activities            (2,507)      

175,999

Effect of changes in exchange rates on cash (850)

237

Net increase in cash, cash equivalents and restricted cash $11,588 $104,243

Cash flow from operating activities

During the six months ended June 30, 2022, net cash provided by operating
activities consisted of net loss of $26.2 million, offset by net non-cash
adjustments to net loss of $63.9 million and net changes in operating assets and
liabilities of $13.7 million. Non-cash adjustments primarily consisted of
depreciation and amortization of $54.9 million and stock-based compensation
expense of $12.6 million, partially offset by deferred taxes of $6.2 million.
Changes in working capital during the six months ended June 30, 2022 were
primarily driven by accounts receivable, net of $9.5 million and prepaid
expenses and other current assets of $8.3 million, partially offset by accrued
expenses and other of $5.2 million.
                                       38
--------------------------------------------------------------------------------

During the six months ended June 30, 2021, net cash provided by operating
activities consisted of net loss of $40.3 million, offset by net non-cash
adjustments to net loss of $61.6 million, and net changes in operating assets
and liabilities of $17.5 million. Non-cash adjustments primarily consisted of
depreciation and amortization of $47.9 million and stock-based compensation of
$12.1 million. Changes in working capital during the six months ended June 30,
2021 were primarily driven by prepaid expenses and other current assets of $13.5
million and accounts receivable, net of $7.1 million, partially offset by
deferred revenue of $7.2 million.

Cash flow from investing activities

During the six months ended June 30, 2022, net cash used in investing activities
was $9.1 million. The cash used was driven primarily by costs to develop
software of $7.5 million. The remainder was used for purchases of property and
equipment.

During the six months ended June 30, 2021, net cash used in investing activities
was $75.8 million. The cash used was driven primarily by acquisition of
companies, net of cash acquired, of $69.0 million. The remainder was used for
costs to develop software and purchases of property and equipment.

Cash flow from financing activities

During the six months ended June 30, 2022, net cash used in financing activities
was $2.5 million. The cash used was primarily driven by payments on long-term
debt of $2.8 million and the repurchase and retirement of shares of our common
stock of $2.7 million, partially offset by proceeds from common stock issuance,
net of $1.8 million and exercise of stock options of $1.1 million. For
additional information regarding our repurchase and retirement of shares of our
common stock, refer to Note 10 in the notes to the unaudited condensed
consolidated financial statements included in this Quarterly Report on Form
10-Q.

During the six months ended June 30, 2021, net cash provided by financing
activities was $176.0 million. The cash provided was driven primarily by net
proceeds from preferred stock issuance of $109.8 million and proceeds from
long-term debt of $69.2 million. The net proceeds from these financings were
primarily used for acquisitions.

Credit facilities

Prior to our Initial Public Offering (the "IPO"), subsidiaries of the Company
were party to a credit facility that provided for (i) a term loan in an
aggregate principal amount of $415.0 million (the "Legacy Term Loan"), (ii)
commitments for delayed draw term loans up to an aggregate principal amount of
$385.0 million (the "Legacy Delayed Draw Term Loans"), (iii) commitments for
revolving loans up to an aggregate principal amount of $50.0 million (the
"Legacy Revolver") and (iv) a sub-limit of the Revolver available for letters of
credit up to an aggregate face amount of $10.0 million, or the letters of credit
(the Legacy Term Loan, Legacy Delayed Draw Term Loans and Legacy Revolver are
referred to herein as the "Legacy Credit Facilities").

In connection with our IPO, on July 6, 2021 we refinanced our Legacy Credit
Facilities and EverCommerce Solutions Inc., as borrower, and EverCommerce
Intermediate Inc. entered into a new credit agreement (the "Credit Agreement")
in an aggregate principal amount of $540.0 million, consisting of (i) an
aggregate principal amount of $350.0 million (the "Initial Term Loans"), (ii) a
revolver with a capacity of $190.0 million (the "Revolver") and (iii) a
sub-limit of the Revolver available for letters of credit up to an aggregate
face amount of $20.0 million. We used the net proceeds of the Initial Term Loans
and a portion of the funds available under our Revolver, together with the net
proceeds from the IPO, to repay all amounts outstanding under our Legacy Credit
Facilities. In November 2021, the Company drew an additional $155.0 million on
the Revolver to fund an acquisition. Subsequently, in November 2021, the Company
drew an additional $200.0 million (the "Additional Term Loans," and collectively
with the Initial Term Loans, the "Term Loans") as permitted by the Credit
Agreement. The Company used the proceeds of the Additional Term Loans to repay
all amounts outstanding on the Revolver and for general corporate purposes.
                                       39
--------------------------------------------------------------------------------

The Initial Term Loans, Revolving Loans and Additional Term Loans are collectively referred to herein as the “Credit Facilities”.

Simultaneously with the execution of the Credit Facilities, we and various of
our subsidiaries entered into a collateral agreement and guarantee agreement.
Pursuant to the guarantee agreement, EverCommerce Intermediate Inc. and various
of our subsidiaries are guarantors of the obligations under the Credit
Facilities. Pursuant to the collateral agreement, the Credit Facilities are
secured by liens on substantially all of our assets, including our intellectual
property and the equity interests of our various subsidiaries, including
EverCommerce Solutions Inc.

The Credit Facilities contain certain affirmative and negative covenants,
including, among other things, restrictions on indebtedness, issuance of
preferred equity interests, liens, fundamental changes and asset sales,
investments, negative pledges, repurchases of stock, dividends and other
distributions, and transactions with affiliates. In addition, we are subject to
a financial covenant with respect to the Revolver whereby, if the aggregate
principal amount of revolving loans (excluding letters of credit) outstanding on
the last day of any fiscal quarter exceeds 35% of the aggregate commitments
available under the Revolver, then our first lien leverage ratio as of the last
day of such fiscal quarter must be 7.50 to 1.00 or less.

Borrowings under the Credit Facilities are available as ABR or Eurocurrency
borrowings. ABR borrowings under the Credit Facilities accrue interest at an
alternate base rate plus an applicable rate, and Eurocurrency borrowings accrue
interest at an adjusted LIBOR rate plus an applicable rate. The ABR rate
represents the greater of the prime rate, Federal Reserve Bank of New York rate
plus ½ of 1%, and an adjusted LIBOR rate for a one month interest period plus
1%. The applicable rate for the Term Loans and the New Revolver loans is 3% for
Eurocurrency borrowings and 2% for ABR Borrowings, in each case subject to
change based on our first lien net leverage ratio.

With respect to ABR borrowings, interest payments are due on a quarterly basis
on the last business day of each March, June, September and December. With
respect to Eurocurrency borrowings, interest payments are due on the last
business day of the interest period applicable to the borrowing and, in the case
of a Eurocurrency borrowing with an interest period of more than three months'
duration, each day prior to the last day of such interest period that occurs at
intervals of three months' duration after the first day of such interest period.

The Revolver has a variable commitment fee, which is based on our first lien
leverage ratio. We expect the commitment fee to range from 0.25% to 0.375% per
annum. We are obligated to pay a fixed fronting fee for letters of credit of
0.125% per annum.

Amounts borrowed under the Revolver may be repaid and reborrowed until the Revolver matures by July 2026. Term loans mature in July 2028. Term loans can be repaid or prepaid but cannot be reborrowed.

From June 30, 2022there was $545.9 million outstanding under our credit facilities, all of which were related to term loans, as no amount was outstanding under the revolver. The effective interest rate on term loans was approximately 4.3% for the three months ended June 30, 2022.

From June 30, 2022we complied with the covenants of the credit facilities.

Stock Repurchase Program

On June 14, 2022, our Board of Directors approved a stock repurchase program
with authorization to purchase up to $50.0 million in shares of the Company's
common stock through the expiration of the program on December 21, 2022.
Repurchases under the program may be made in the open market, in privately
negotiated transactions or otherwise, with the amount and timing of repurchases
to be determined at the Company's discretion, depending on market conditions and
corporate needs. This program does not obligate the Company to acquire any
particular amount of common stock and may be modified, suspended or terminated
at any time at the discretion of the Board
                                       40
--------------------------------------------------------------------------------

of administrators. The Company expects to fund redemptions with existing cash. The Company repurchased and withdrew 296,046 common shares for
$2.7 million in the three and six months ended June 30, 2022.

Contractual obligations

There have been no material changes to our contractual obligations as of
June 30, 2022 from those disclosed in our annual report on Form 10-K.

Refer to Note 9 in the unaudited condensed consolidated financial statements
included in this Quarterly Report on Form 10-Q and notes thereto for a
discussion of our debt. Refer to Note 16 in the Financial Statements and
Supplementary Data section of our Annual Report on Form 10-K for a discussion of
our commitments and contingencies.

Critical Accounting Policies and Significant Judgments and Estimates

Our financial statements are prepared in accordance with GAAP. The preparation
of our financial statements in conformity with GAAP requires us to make
estimates and assumptions that affect certain reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period.

Our critical accounting policies are described in Part II Item 7, "Management's
Discussion and Analysis of Financial Condition and Results of
Operations-Critical Accounting Policies" in our Annual Report on Form 10-K.
During the six months ended June 30, 2022, there were no material changes to our
critical accounting policies from those discussed in our Annual Report on Form
10-K.

Recent accounting pronouncements

See Note 2 in the Notes to the Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for a discussion of recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted and their impact potential on our financial statements.

Election under the Jumpstart Our Business Startups Act of 2012

The Company currently qualifies as an "emerging growth company" under the
Jumpstart Our Business Startups Act of 2012, or the JOBS Act. Accordingly, the
Company is provided the option to adopt new or revised accounting guidance
either (i) within the same periods as those otherwise applicable to non-emerging
growth companies or (ii) within the same time periods as private companies.

The Company has elected to adopt new or revised accounting guidance within the
same time period as private companies, unless management determines it is
preferable to take advantage of early adoption provisions offered within the
applicable guidance. Our utilization of these transition periods may make it
difficult to compare our financial statements to those of non-emerging growth
companies and other emerging growth companies that have opted out of the
transition periods afforded under the JOBS Act.

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