UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-40949

Enfusion, Inc.

(Exact name of registrant as specified in its charter)

Delaware

87-1268462

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

125 South Clark Street, Suite 750

Chicago, Illinois 60603

(Address of Principal Executive Offices)

(312) 253-9800

(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol	Name of Exchange on which registered
Class A common stock, par value $0.001 per share	ENFN	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐	Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 7, 2023, the registrant had 116,286,201 shares of common stock outstanding, consisting of 75,087,434 outstanding shares of Class A common stock and 41,198,767 outstanding shares of Class B common stock.

Table of Contents

TABLE OF CONTENTS

		Page
	GLOSSARY	3
	SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS	4
Part I.	FINANCIAL INFORMATION	6
Item 1.	Condensed Consolidated Interim Financial Statements (Unaudited)	6
	Condensed Consolidated Interim Balance Sheets	6
	Condensed Consolidated Interim Statements of Operations	7
	Condensed Consolidated Interim Statements of Comprehensive Income (Loss)	8
	Condensed Consolidated Interim Statements of Stockholders’ Equity	9
	Condensed Consolidated Interim Statements of Cash Flows	10
	Notes to Condensed Consolidated Interim Financial Statements	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29
Part II.	OTHER INFORMATION	31
Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31
Item 3.	Defaults Upon Senior Securities	32
Item 4.	Mine Safety Disclosures	32
Item 5.	Other Information	32
Item 6.	Exhibits	33
	Signatures	34

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GLOSSARY

As used in this Quarterly Report on Form 10-Q, unless the context otherwise requires:

●

“Award Units” refers to Management Incentive Award Units issued under Enfusion Ltd. LLC’s Change in Control Bonus Plan.

●

“Change in Control Bonus Plan” refers to Enfusion Ltd. LLC’s former Change in Control Bonus Plan for certain members of management that provided for the payment of a cash bonus based on a specified number of Award Units in the event of a change in control transaction, as defined in Enfusion Ltd. LLC’s operating agreement. In October 2021, Enfusion Ltd. LLC’s board of managers elected to terminate such plan (and all Award Units issued thereunder) upon effectiveness of the registration statement for our IPO.

●

“Common Units” refers to the new class of units of Enfusion Ltd. LLC created by the reclassification of the LLC interests of Enfusion Ltd. LLC as part of the Reorganization Transactions.

●

“Enfusion,” the “Company,” “we,” “us” and “our” and similar references refer: (1) following the consummation of the Reorganization Transactions, including our IPO, to Enfusion, Inc., and, unless otherwise stated, all of its direct and indirect subsidiaries, including Enfusion Ltd. LLC and (2) prior to the completion of the Reorganization Transactions, including our IPO, to Enfusion Ltd. LLC and, unless otherwise stated, all of its direct and indirect subsidiaries.

●

“IPO” refers to the Company’s initial public offering, completed on October 25, 2021.

●

“Pre-IPO Owners” refer to the equity holders who were the owners of Enfusion Ltd. LLC immediately prior to the Reorganization Transactions.

●

“Pre-IPO Common Unitholders” refer to Pre-IPO Owners that held Common Units following the Reorganization Transactions.

●

“Reorganization Transactions” refer to our IPO and certain organizational transactions that were affected in connection with our IPO, and the application of the net proceeds therefrom. See “Initial Public Offering and Reorganization Transactions” in Note 2 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021 for a description of the transactions.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations, financial condition, business strategy, plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” or the negative of these words or other similar terms or expressions. These forward-looking statements are based on management’s current expectations and assumptions about future events, which are inherently subject to uncertainties, risks, and changes in circumstances that are difficult to predict. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements concerning the following:

●

our future financial performance, including our revenues, costs of revenues, gross profit or gross profit margin and operating expenses;

●

the sufficiency of our cash, cash to meet our liquidity needs;

●

anticipated trends and growth rates in our business and in the markets in which we operate;

●

our ability to maintain the security and availability of the products and services that comprise our solution;

●

our ability to increase the number of clients using our solution;

●

our ability to sell additional products and services to and retain our existing clients;

●

our ability to successfully expand in our existing markets and into new markets;

●

our ability to effectively manage our growth and future expenses;

●

our market opportunity and the potential growth of that market, our liquidity and capital needs and other similar matters;

●

our ability to maintain, protect and enhance our intellectual property;

●

our ability to comply with modified or new laws and regulations applying to our business;

●

the attraction and retention of qualified employees and key personnel;

●

our anticipated investments in sales and marketing and research and development;

●

our ability to successfully defend litigation brought against us;

●

the increased expenses associated with being a public company;

●

the impact of the COVID-19 pandemic and other global financial, economic, and political events on our business and industry; and

●

our ability to compete effectively with existing competitors and new market entrants.

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You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in Item 1A. Risk Factors in this Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K for the year ended December 31, 2022. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q. And while we believe such information provides a reasonable basis for such statements, such information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and you are cautioned not to unduly rely upon these statements.

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

ENFUSION, INC.

Condensed Consolidated Interim Balance Sheets

(dollars in thousands, except per share amounts)


	As of		As of
	March 31, 2023		December 31, 2022
	(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	54,598	$	62,545
Accounts receivable, net		24,356		25,855
Prepaid expenses		5,600		6,105
Other current assets		2,093		2,303
Total current assets		86,647		96,808
Property and equipment, net		16,879		15,759
Right-of-use-assets, net		13,438		6,732
Other assets		4,529		4,484
Total assets	$	121,493	$	123,783

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	1,290	$	1,685
Accrued expenses and other current liabilities		7,403		11,665
Current portion of lease liabilities		5,013		4,030
Total current liabilities		13,706		17,380
Lease liabilities, net of current portion		8,642		2,959
Total liabilities		22,348		20,339
Stockholders' Equity:
Class A common stock, $0.001 par value; 1,000,000,000 shares authorized, 74,081,623 and 70,859,711 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively		74		71
Class B common stock, $0.001 par value; 150,000,000 shares authorized, 41,198,767 and 43,198,767 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively		41		43
Additional paid-in capital		240,075		244,260
Accumulated deficit		(176,012)		(178,863)
Accumulated other comprehensive loss		(473)		(504)
Total stockholders’ equity attributable to Enfusion, Inc.		63,705		65,007
Non-controlling interests		35,440		38,437
Total stockholders' equity		99,145		103,444
Total liabilities and stockholders' equity	$	121,493	$	123,783

See Notes to Condensed Consolidated Interim Financial Statements.

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ENFUSION, INC.

Condensed Consolidated Interim Statements of Operations

(dollars in thousands, except per share amounts)

(Unaudited)


	Three Months Ended March 31,
	2023		2022
REVENUES:
Platform subscriptions	$	37,998	$	31,551
Managed services		2,744		2,230
Other		229		360
Total revenues		40,971		34,141

COST OF REVENUES:
Platform subscriptions		11,675		9,311
Managed services		1,564		1,615
Other		63		57
Total cost of revenues		13,302		10,983
Gross profit

SEC Form 10-Q filed by Enfusion Inc.