MARTELLO INVESTOR OVERVIEW...any forward-looking statements, whether as a result of new information,...
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Transcript of MARTELLO INVESTOR OVERVIEW...any forward-looking statements, whether as a result of new information,...
Forward Looking Statements and Confidentiality
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No Offer to Purchase Securities
These documents are provided in the necessary course of business to prospective investors in respect of a potential private placement of the Company’s securities. These documents are not an offering memorandum, prospectus, public offering or any other offer of the Company’s securities, and any subsequent offer of the Company’s securities shall comply in all respects with all applicable securities laws and regulations. The information in this presentation is intended for use only by persons resident in jurisdictions where such use is lawful. Nothing in this presentation constitutes, and under no circumstances is to be construed as, an offer or solicitation to purchase securities of, or advertisement for, securities of the Company. The securities of the Company have not been registered under the United States Securities Act of 1933, as amended or any state securities laws.
Forward Looking Statements
Certain statements contained in this presentation (including information incorporated by reference) are "forward looking statements". Our forward-looking statements include, without limitation:
• Estimates of future costs and other expenses;• Estimates of future capital expenditures and other cash needs, and expectations as to the funding thereof;• Statements regarding future transactions; and• Estimates regarding timing of future capital expenditures and production activities.
This list is not exhaustive of the factors that may affect our business, our value as a company, and our forward looking statements. Where we express an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are subject to risks, uncertainties, and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by those forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on our forward-looking statements. All subsequent written and oral forward-looking statements attributable to the Company or to persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. The Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Use of Information
These documents are CONFIDENTIAL. They may not be reproduced and the information disclosed therein may not be made available to anyone who has not signed a confidentiality agreement with the Company without the prior written consent of the Company. Any information communicated to the Company through this presentation becomes the Company’s exclusive property. The Company shall be entitled to use any such information for any purpose without restriction or compensation to any person. Such information provided by the user shall be deemed to be non-confidential.
TSXV: MTLO
FOUNDED IN 2009
90% RECURRING
REVENUE
$13M REVENUES
(FY20)
REACHING 175+
COUNTRIES
120 EMPLOYEES
IN 5 COUNTRIES
5000+ CUSTOMERS
RECOGNIZED DIGITAL
EXPERIENCE MONITORING
VENDOR
Martello at a Glance
$
M
Key Metrics
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$13.1MRevenues
90% Recurring Revenue
94%Gross Margins
$990kMRR
Martello FY20
Martello Q4 FY20
FY20
Martello Q4 FY20
User Experience is Moving up the CIO Value Chain
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DIGITAL TRANSFORMATION IS ACCELERATED BY COVID-19
Surge in Microsoft Teams usage in one month during COVID-19.
74%
70%
Of businesses will make some of their employees permanently remote post COVID-19.
CIOs NEED TO MANAGE THE CLOUD USER EXPERIENCE
As businesses adopt commercial cloud stacks to run applications, I&O leaders are becoming
blindsided because of the lack of control and visibility this creates. This is especially the case with
SaaS applications, where monitoring teams have no visibility into the infrastructure layer and cannot
instrument the application.- Gartner
By 2023, 60% of digital business initiatives will require operations to report on user’s digital experience, up 15% from today.
Source: Gartner
Industry’s Deepest Insight into User Experience
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Competitors tell you when a problem has happened. Martello tells you when a problem is going to happen and why.
COMPETITORS MARTELLOTell you a bad voice
call happened.Proactively tells you a bad call
is GOING TO HAPPEN and correlates multiple data sources to tell you WHY.
COMPETITORS MARTELLOTell you a bad Teams meeting happened.
Proactively tells you a bad meeting is GOING TO
HAPPEN and correlates multiple data sources to tell
you WHY.
Jane has a bad Teams meetingJohn has a bad voice call
As applications and services move into the cloud, user experience is critical – but hard to understand and address.
Martello gives businesses the clearest picture of the user experience with DIGITAL EXPERIENCE MONITORING.
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Monitor quality of the user experience for Mitel voice services and Microsoft Office 365.
Analyze Microsoft Office 365 performance and the underlying IT infrastructure.
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Digital Experience Monitoring (DEM)PRODUCTS MARKET
MONITORING
ANALYTICS
200M MONTHLY ACTIVE USERS
75M DAILY ACTIVE USERS
70MUSERS
KEY COMPETITORS
Financial & Banking
Education
Other
Who Needs Martello? ALL BUSINESSES USE CLOUD SERVICES
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History of Martello
COMPANYFOUNDEDApril 2009
ACQUIRED ELFIQ NETWORKSDECEMBER 2017
2017 20202018 2019
$7.5M PRIVATE PLACEMENTJUNE 2018
$4.5M OVERNIGHT MARKETED PUBLIC OFFERINGSEPTEMBER 2019
LIST ON THETSXVSEPTEMBER 2018
ACQUIREDSAVISIONNOVEMBER 2018
ACQUISITION OF GSX
MAY 2020
$6.9M BOUGHT DEAL
MAY 2020
TODAY
[email protected] 11May 28, 2020
Better Together: SaaS + DEM Growth
MARTELLO BRINGS:
Cloud based multi-tenant SaaS expertise.Breadth across the whole DEM spectrum.Larger team with better access to capital through public markets.
GSX BRINGS:
Growing DEM player: MS Office 365 revenue growth increased 34% in FY2019.Deep Microsoft Office 365 digital experience monitoring expertise.Customer base with minimal overlap.
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What Martellodoes for Mitel, GSX does for Office 365
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200M O365 monthly subscribers(In addition to Mitel 4.7M cloud seats and 70M end customers).
3M new O365 subscribers every month.
By 2023, 40% of new enterprise telephony purchases will be based on a cloud office suite — either Microsoft Office 365 or Google G Suite.
About half of all Office 365 problems are network-related.
Financials
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• GSX generated €4.4MM of revenues in FY2019 (CDN $6.6MM).
• Pro forma consolidated revenues on a trailing twelve-month basis are approximately CDN $19.7 million.
• Approximately 89% of total GSX revenue during FY2019 was recurring, with Monthly Recurring Revenue (MRR) of approximately €0.3MM (CDN$0.45MM).
• GSX billings from sales of Microsoft Office 365 digital experience monitoring increased by 34% in FY2019.
• GSX’s gross margins are approximately 90%.
• Once synergies are realized from integration, Martello believes that GSX can deliver positive adjusted EBITDA contribution.
Note: All figures above per December 31, 2019 unaudited financial statements prepared by GSX.
Martello Enables Remote Work“We’re being forced into the world’s largest work-from-home experiment and, so far, it hasn’t been easy for a lot of organizations to implement”
- Saikat Chatterjee, Senior Director, Advisory at Gartner.
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INDUSTRY TRENDS
• Surge in network bandwidth usage: Vodafone reports 50% increase in internet usage in some European countries, as more people are at home (streaming, working from home, etc.)
• Increased video conferencing: Microsoft reported a 34% increase in MS Teams usage during the week of March 16th.
• Communication reliability becomes mission critical: for hospitals, for businesses to compete and remain productive.
Remote Work Use Cases
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• Know how your network will perform under the strain of increased voice and video calls, streaming at home: UCScore.com web-based site qualification.
• Ensure remote collaboration and communication tools work when you need them: UC Performance Analytics monitoring, troubleshooting and alerting for these key services.
• Visualize the health and availability of Office 365 and other key services on a 24/7 basis: IT Operations Analytics single pane of glass consolidating IT performance data.
Q4 and FY20 Financial Highlights
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• $13.1M FY20 revenues
• 90% of revenues recurring
• Adjusted EBITDA nearing breakeven ($151K) in Q4
• Monthly Recurring Revenue (MRR) $990K
• Gross margin 94%
• 9% organic growth
Period ended December 31, 2019
Subsequent Events:
• Acquisition of GSX• $6.9M bought deal led by PI
Financial and Eight Capital.• Debt Financing:
• US$8M Vistara Capital subordinated secured term loan: acquisition of GSX
• National Bank revolving facility up to $7.5MM: currently undrawn
March 31, 2020
Key Financial and Market Information
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(1) As at July 7, 2020
All $ figures in CAD, as of 31 March 2020 unless otherwise indicated
CapitalizationShares outstanding (basic)(1)…..264.0MShare price (1)……………………………………..$0.22Market Cap (1)………………………………….$58.1MInsider Ownership(1) ……….....……………….19%
Balance SheetWorking Capital…………………………….$3.9MDebt…………………………………………………...$2.5MCash……………………........................…………$5.9M
Leadership Team
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Management BoardJohn ProctorChief Executive Officer
ICT Executive previously VP Cyber Security for CGI.
Sir Terry MatthewsCo-Chairman
Founder and Chairman of Wesley Clover International. Has founded or funded 100+ companies since 1972, including Mitel and Newbridge.
Erin CroweChief Financial Officer
20+ years CFO experience with oversight of $130M+ revenues.
Bruce LintonCo-Chairman
Co-founder and former Chairman of Canopy Growth Corporation. Responsible for the acquisition and/or disposition of 6 billion dollars in business assets.
Doug BellingerChief Technology Officer
20+ years telecom software product development.
John ProctorChief Executive Officer
ICT Executive previously VP Cyber Security for CGI.
Rob DoucetteVP Product Management
Mike DanforthVP Global Partnerships & Sales
Tracy KingVP Marketing
15+ years software product development.
15+ years direct and channel B2B software sales leadership.
20+ years B2B technology marketing and communications.
Niall GallagherCo-Founder
Mike Michalyshyn
Colley Clarke
Don Smith
Mike Galvin
Jennifer Camelon
30 years telecom industry experience.
Seasoned technology lawyer with experience in embedded software with QNX Software Systems and BlackBerry.
Experienced CFO with financial leadership of TSX, NASDAQ and AIM listed technology companies.
General Partner at Wesley Clover International, CEO of Mitel 2001 to 2011.
32 yrs BT PLC, responsible for design, deployment and management of the largest broadband networks in the UK.
Technology industry finance and business executive leading transformation initiatives for QNX
Why Invest in Martello
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Recurring revenue provides stability and upside in times of uncertainty• 90% of revenues recurring• $1.5M MRR base entering 2021• 94% gross margins
Based on Q4 FY20 Results, and Proforma TTM estimates combining GSX
Market opportunity validated by Gartner, Lenders and other third parties
• Demand for remote, real-time services is surging (Teams, Zoom, Mitel collaboration etc), and Martello ensures a solid user experience for these services.
• MS Office 365 dominates the business application market, and Martello has the leading tool to ensure a strong user experience.
• Martello’s breadth of capabilities differentiate it from competitors attempting to disrupt traditional network monitoring with Digital Experience Monitoring (DEM).
