Tiny Ltd. Class A · TSX:TINY
Tiny Ltd. Class A — Merger or Acquisition (March 2025)
25 slides from Tiny Ltd. Class A's merger presentation, Mar 31, 2025
Slide 1: Acquisition of a Majority Interest in Serato
Acquisition of a Majority Interest in Serato March 31, 2025
Slide 2: Cautionary Language
Cautionary Language A final base shelf prospectus containing important information relating to the securities described in this document has been filed with the securities regulatory authorities in each of the provinces of Canada. The final base shelf prospectus, any applicable shelf prospectus supp
Slide 3: Legal disclaimer
Legal disclaimer This presentation (the “Presentation”) has been prepared solely for informational purposes from information supplied by Tiny Ltd. (the “Company”) and is being furnished through ROTH Canada, Inc. (“Roth”) and Canaccord Genuity Corp. (“Canaccord”) solely for your information and does
Slide 4: Legal disclaimer
Legal disclaimer Third-Party Sources This Presentation may contain quotes, information, data (including references to market, industry or peer group data) which has been obtained from or is based upon third party sources, including industry publications, reports and websites. Third party sources may
Slide 5: Legal disclaimer
Legal disclaimer Non-IFRS Financial Measures and Serato Financial Information This Presentation refers to certain financial performance measures that are not defined by and do not have a standardized meaning under International Financial Reporting Standards (termed “Non-IFRS measures”) such as “EBIT
Slide 6: Tiny Co-Founders & Leadership
Tiny Co-Founders & Leadership Andrew Wilkinson Chris Sparling Jordan Taub Mike McKenna Austin Singhera CO-FOUNDER & CHAIR CO-FOUNDER & VICE CHAIR CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER VP, INVESTMENTS OF THE BOARD OF DIRECTORS OF THE BOARD OF DIRECTORS Public face of Tiny, driving Oversees
Slide 7: Tiny: A Leading Technology Holding Company
Tiny Founded: 2016 A Leading Technology LTM Q3’24 Revenue: Tiny Fund 1 Capital Raised: Holding Company C$198M US$148M TINY KEY BUSINESS UNITS Q3’24 Adj. EBITDA Margin(1): Q3’24 ARR(1): ~16% C$39M Software & Apps - Creative Platform - Tiny Ltd. WeCommerce Dribbble & Creative Market Q3 2024 Revenue →
Slide 8: Transaction Highlights
Transaction Highlights Tiny plans to acquire a 66% stake in Serato Audio Research Limited ("Serato"), a global leader in DJ Software 1 Leader in DJ Software with Majority Recurring Revenue Business Model 2 Founded in 1998, Long Track Record of Consistent Growth and Profitability 3 Strong Moat with H
Slide 9: Serato At A Glance
Serato At A Glance DJ Software 2M+ US$31M Run-Rate Revenue(1,2) Users Globally Production Software ~34% 165+ Adj. EBITDA Margin(1,2) Employees Strong growth in subscription revenue (Year ending March 31) ~62%2 Successfully executing on strategy to shift #1 US$31M 57% ~62% in DJ Software Market busin
Slide 10: Proven Record of Revenue Growth
– Proven Record of Revenue Growth $31M FY10A FY11A FY12A FY13A FY14A FY15A FY16A FY17A FY18A FY19A FY20A FY21A FY22A FY23A FY24A Run-Rate Notes: (1) Serato FY ending March 31st. (2) “Run-Rate Revenue” is a Non-IFRS Financial measures. See "Legal disclaimer" and "Non-IFRS Measures" for additional inf
Slide 11: Industry Leading Product Offering
Industry Leading Product Offering AUDIO RESEARCH (1,2) ~13%(1,2) Music Production Serato DJ of~87% software revenue of software revenue Approach Approach Industry leading brand for DJs: Software built for modern music making: ▪ Popular software suite for DJs: perform, mix, sample, etc. ▪ Digital aud
Slide 12: Why Serato?
Why Serato? A proven market leader powering the global entertainment industry for the last 25 years Adopted by Millions Constant Product Innovation Attractive Financial Profile Leading DJ Software by market share Further solidify market leadership in DJ High degree of visibility on revenue and with
Slide 13: Transaction Details & Strategic Alignment
Transaction Details & Strategic Alignment(1) ⚫ Acquisition of 66% of Serato’s outstanding shares for US$66 million (US$100 million on 100% basis) — ~9.6x run-rate Adj. EBITDA — Upfront consideration settled ~64% in cash and ~36% in shares of Tiny ⚫ Potential performance based earnout payment in 2027
Slide 14: Expected to be a Transformational Acquisition for Tiny
Expected to be a Transformational Acquisition for Tiny Expected Pro Forma Impact(1,2,3,4) Greatly Enhanced Financial Profile Post-Transaction(1,2,3,4,5) ~21% increase in revenue Revenue C$198M ~C$240M ARR C$39M ~C$66M ~68% increase in ARR Software Revenue % of Total ~27% ~35% Recurring Revenue % of
Slide 15: Compelling Transaction Rationale
Compelling Transaction Rationale Tiny can achieve operational efficiencies around pricing, payment, digital marketing attribution, and cost consolidation ⚫ Various avenues for organic growth including mobile release Several Growth (increasing top of funnel), USB export (professionals need), cloud Le
Slide 16: Serato Directly Aligns with Tiny's Strategic Priorities
Serato Directly Aligns with Tiny’s Strategic Priorities Making sure that Tiny continues to be a great home for wonderful businesses Focus on recurring Increasing cash flow through Managing and reducing Incentive plans aligned to revenue platforms disciplined investment in debt levels across the orga
Slide 17: Additional Transaction Details
Additional Transaction Details ⚫ US$66.0 million base consideration for a minimum of 66% of the fully diluted issued and outstanding securities of Serato Transaction — Base consideration consists of US$42.4 million cash and US$23.6 million in Tiny shares Summary ⚫ Potential earnout payment in 2027 p
Slide 18: Appendix A
Appendix A
Slide 19: Tiny Fund I
Tiny Fund I GENERAL PARTNER INITIAL ACQUISITION FUND ACQUISITION DATE OWNERSHIP COST Tiny Ltd. Tiny Ltd. holds 20.34% LP interest August 2021 93.8% US$64.7M CAPITAL RAISED September 2023 60.0% US$36.0M US$148M March 2022 85.0% US$14.8M TERM January 2024 100.0% US$9.4M 10 year, with one 1-year extens
Slide 20: Focus on Debt Repayment
Focus on Debt Repayment NET DEBT TO ADJUSTED EBITDA(1) RATIO SEPTEMBER 30, 2024 DECEMBER 31, 2023 Cash $18.6M $26.9M Position 3.8x Debt 3.5x $115.0M $131.2M 3.1x 3.2x Outstanding Net Debt $96.4M $104.3M 2023 Q4 2024 Q1 2024 Q2 2024 Q3 Total debt outstanding on September 30, 2024 was During Q4 2024,
Slide 21: Serato is Uniquely Positioned Amongst Its Peers
Serato is Uniquely Positioned Amongst Its Peers ⚫ Globally recognized brand for over two decades with a loyal user base ⚫ Used by many top DJs and producers: Timbaland, Constant Product Innovation Disclosure, Khalil, Melo-x, DJ Jazzy Jeff, A-Trak, Diplo, Lil Jon and many more ⚫ Multi-year product ro
Slide 22: Non-IFRS Measures
Non-IFRS Measures NON-IFRS MEASURES Investors are cautioned that the non-IFRS measures used below should not replace net income or loss (as determined in accordance with IFRS) as an indicator of the Company’s performance. These are supplemental measures management uses in managing the business and m
Slide 23: Non-IFRS Measures (Cont'd)
Non-IFRS Measures (Cont’d) NON-IFRS MEASURES Investors are cautioned that the non-IFRS measures used below should not replace net income or loss (as determined in accordance with IFRS) as an indicator of the Company’s performance. These are supplemental measures management uses in managing the busin
Slide 24: Non-IFRS Measures (Cont'd)
Non-IFRS Measures (Cont’d) Adjusted EBITDA Margin (Serato) for the Q3’24 ARR (Tiny) nine months ended September 30, 2024 Net income C$5.5M Recurring revenue C$9.8M 21% Income tax expense C$2.5M Non-recurring revenue C$36.9M 79% Depreciation and amortization C$0.8M Total Q3 2024 revenue C$46.7M 100%
Slide 25: Non-IFRS Measures (Cont'd)
Non-IFRS Measures (Cont’d) LTM Adjusted Revenue and EBITDA (Tiny) Q3 2024 Q2 2024 Q1 2024 Q4 2023 Trailing Total Adjusted EBITDA C$7M C$7M C$7M C$10M C$31M Revenue C$47M C$51M C$49M C$51M C$198M % Margin 16% Net Debt to Adjusted EBITDA (Tiny) Q3 2024 Q2 2024 Q1 2024 Q4 2023 Total debt C$115.0M C$121