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  "documentTitle": "Hims & Hers Health, Inc. (HIMS)",
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  "presentationDate": "2023-07-13 00:00:00",
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  "notes": "Includes a CEO quote to highlight the early-stage churn problem.",
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      "text": "Most sources suggest that average ANNUAL churn rates for enterprise SaaS companies are 5-7%. With HIMS likely over 50%, comparisons to enterprise SaaS are clearly not appropriate in our view. Moreover, as HIMS has noted, much of this churn occurs in the first few months, making HIMS even less \"SaaS-like\".",
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      "text": "Most sources suggest that average ANNUAL churn rates for enterprise SaaS companies are 5-7%. With HIMS likely over 50%, comparisons to enterprise SaaS are clearly not appropriate in our view.",
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      "text": "churn rate: 77%",
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      "kind": "paragraph",
      "text": "Multiplying period average retention by current monthly average revenue per customer reveals that HIMS' retention metric and performance relates to just 16% of estimated revenue through the end of year 3.",
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      "text": "Since coming public, HIMS has declined to disclose a specific churn metric other than saying that its average monthly churn, despite several references to improvement over time, remains in the mid-single-digit percentages. Based on HIMS' language used, we assume HIMS current monthly churn is approximately 6%. This equates to 77% churn by the end of year two.",
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      "kind": "quote",
      "text": "But most of that churn really takes place in the first couple of months of the consumer and patient getting acquainted with their medication and building that habit.",
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      "kind": "quote",
      "text": "\"But most of that churn really takes place in the first couple of months of the consumer and patient getting acquainted with their medication and building that habit.\" — CEO Dudum on Q3 2021 Earnings Call",
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      "kind": "source-note",
      "text": "Source: Spruce Point Analysis, HIMS Q3 2021 Earnings Call Transcript",
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      "text": "Year-End Churn Sensitivity Analysis",
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      "text": "Theoretical Revenue Retention Through Year 3",
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      "text": "Based On Our Analysis, HIMS' Actual Retention Is Poor And Its Churn Is High",
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