Getbusy (LSE:GETB) — Interim Results

0:02 Good afternoon and welcome to the GETBUSY PLC Interim Results Investor Presentation and apologies for the short delay today. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the Q and A tab situated in the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question it receives in the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. And I'd now like to hand you over

0:33 to Daniel Rabi, CEO. Good afternoon, sir. Good afternoon. Thank you very much for having us, and thank you everyone for joining this afternoon. And welcome to GETBUSY h one twenty twenty two results in which we accelerated our ARR growth and upgraded market expectations. I'm I'm Daniel Rabi. I'm the CEO of GETBUSY, and with me today is Paul Howarth, our CFO. Our mission as a company is to build software to make people productive and happy.

1:11 This first half of the year was, in my opinion, the our best results to date. I think we are building substantial scale and proving growth in very large and very valuable addressable markets. To be more specific around that, we now have two over 2,000,000 collaborators using our applications. We handle 250,000,000 documents annually. We do over 3,000,000 esignatures annually, which if we were just a standalone esignature company, would be pretty good considering it's a small part of our application. It gives you some indication of how much usage we get. We've done a 114 product innovations, which shows our capabilities to continue to innovate in the future.

2:03 Our ARR hit 18.1, which is 21% growth on the previous period. We're 94% recurring revenue. We have over 70,000 73,000 paying users. Our net revenue retention is over a 100, which means that if you just look at our our customer base at any point, and remove new sales growth, just look at the revenue we get through that customer base relative the amount that churns, we grow through in our through our existing client base. We have a 145 people in our organization across three geographical locations, The UK, US, and Australia. We have twenty years of track record in what we do.

2:49 We're very, experienced in b to b productivity software, and we spend 23% of our revenue in r and d.

3:01 Our business model is a highly valuable business model. As a result of that, we are targeting significant shareholder returns through compounding the high value of recurring revenue. Recurring revenue is, very predictable. It enables us as an organization to be very data driven. We're very clear on what our return on investment is. So, typically, for $1 of cost to acquire a customer, we get $4 back over the lifetime of that customer. We're pretty confident with or we're very confident with the 94% recurring revenue, and our net revenue retention over a 100 of what our next twelve month growth will be. And therefore, we can manage costs in a very proactive way.

3:55 And it's the subscription revenue provides a solid foundation for future growth. So it enables you to invest in the future and continue to build up that sustainable and scalable nature that recurring revenue gives you. Long term, it's extremely valuable because it creates a whole a path to significant cash generation. So we're in very scalable markets. There is favorable working capital. There's very high margins. And all of those scalable characteristics enable ultimate value within a business like ours. So typical multiples of seven times ARR

4:45 in our space, generally greater than that. Effectively, what they are, proxy for future cash flow through DCF model. So the valuations, because of how predictable and scalable our business model are, are well justified.

5:03 We have successfully, and we'll continue to do continue to broaden our capabilities to underpin medium and long term growth. So we have, established products which are, driving the growth you've seen today, and we think that there's long term growth out of those existing products through continued successful edge, execution on our strategy. We then are complementing that by emerging products, into new, markets. So we feel that the problems we're solving for professional service firms through our SmartVault and our virtual cabinet, products are consistent with the problems that ERP users have or financial services in The US has, and we have the capabilities to solve these problems. So, we're gonna leverage off those capabilities to create new addressable markets, which ultimately will result in, continued and higher, long term growth.

6:09 In summary, what we do is we create a productivity layer on top of core business applications. So as an example, I'll use the one in which we are most familiar with, which is tax preparation. If I'm an accountant, I traditionally create a tax return in my tax software. And the tax software then is very limited when I wanna go in a store, file that tax return, or send that to a client to get esigned or, make sure that there is a task around that top tax return internally or wanna book an appointment with a a, customer to talk through that tax return. So core applications are generally very good at creating value in the core functions of the business.

7:00 And where we come in is we deeply integrate into those core mission critical applications, and we add this layer of productivity software around that. And that started as document management, but that's evolved over the last couple of years into chat, e signature, client portals, appointment booking, quotes, and proposals. And we can see multiple different, productivity components that over time we can solve to ink. Ladies and gentlemen, just do bear with us while we just bring Daniel back into the room.

8:06 Paul, I'd I'd we're just waiting for Daniel to dial back in. I've just lost connection briefly. Yeah. Absolutely. I can I can I can pick up from here? My apologies to everyone. We are having some challenges today. So you can't see me or can you hear Daniel at the moment? But, Trina, hopefully, we'll get through this. So as Daniel was explaining, our software creates a layer of productivity for core business applications. And amongst the professional services firms that we serve, typically, those core business applications comprise things like tax preparation software, practice management software if you're an accountant, CRMs, like customer relationship management, applications like Salesforce, or ERP systems, which often run entire businesses, ERP like NetSuite or SAP.

8:59 Typically, those applications are very good at what they do. They're very good, for example, with ERP at managing procurement processes and with CRM at managing customer relationships and marketing activities. But typically, they're not built with productivity in mind for the user. So if those activities involve, for example, documents or approvals or signatures, typically, they're not built with that in mind. So our products overlay a layer of productivity onto those core features of functionality. And increasingly, what we're seeing is professional firms building stacks of specialist software that talks to each other in order to optimize productivity within businesses.

9:50 Moving on to the next slide. This shows our product suite. So we have two established products, which comprise the majority of our revenue at the moment. Those products are SmartVault and Virtual Cabinet. Roughly in revenue terms, they're about fifty-fifty. SmartVault recently slightly eclipsed Virtual Cabinet and is growing at the fastest rate. These products initially were aimed at the SME and enterprise accounting professional services market. And they help customers to manage their document workflows, to manage interactions with clients in a very secure and very efficient way. SmartVault typically is aimed at the SME end of town, so typically accounting firms with fewer than, say, 20 users, whereas Virtual Cabinet goes from single user customers all the way up to just under the big four in terms of accounting firms.

10:45 Those products comprise both cloud hosted and on premise solutions, and we have a suite of mobility applications around them to enable people to be able to access their documents and their data from anywhere and from any device. And those products principally operate in The UK, in The US, and in Australia and New Zealand. We then have two emerging products. Workhero, which some of you will know used to be called GETBUSY, is really our next generation document management product. It's aimed specifically at the ERP space. So we're starting with an integration with Oracle NetSuite. And it creates, again, a layer of productivity, particularly around the handling of documents and tasks and signatures within the ERP interface.

11:35 NetSuite has a customer base that ranges from SME to enterprise clients. So that very much is our target audience. NetSuite itself has about 31,000 installed customers. Worth noting as well that Workhero, the Workhero technology, is also a core part of the virtual cabinet cloud offering. There is a deep integration between Workhero and virtual cabinet. Certified Vault is a product that we launched towards the end of last year. It is essentially an iteration of the SmartVault platform aimed at helping customers in the asset finance space in The U. S. To secure digital chattel paper. So effectively, certified Volt Act as a custodian of that digital chattel paper in asset finance transactions. An example would be a business that leases, say, plants and machinery to end customers.

12:32 So the clients there are both the secured lenders, so the banks essentially, and the borrowers in an asset finance transaction. And then we have three new technologies, which were all acquired last year. And ultimately, two of them will be integrated into our established products. Knockdown is a form fill and data capture piece of technology, which will help clients to or help our customers to onboard their clients. Quotas is a quoting and proposal tool to help accountants issue much quicker, much more efficient and more professional looking quotes and proposals. Both of those applications are in the process of being integrated into our smart vault application, And we expect to be taking those to market later on this year.

13:24 HelloPlan is a technology that we acquired and are building on the back of within The UK at the moment, and that is that enables professionals to manage the scheduling and the hosting of meetings. So effectively, more proactive role for the application by travel meeting. Paul, if I may just interrupt, Daniel is now back on the line, sir. So thank you for for stepping in. And Daniel, if I may just hand back to you in the meantime. You're welcome. Thank you, Mark. And and and thanks, Paul. Apologies, everyone. Technical issues. So following on from what Paul just described around each one of our products, we're now very embedded within the working day of the professional.

14:13 And we solve really practical problems like scheduling a meeting or sending a quote or onboarding new clients, creating and managing work, and collaborating and signing. So it's this core value which is why we are so sticky and our churn rates are so low. It's why we're so in demand because these functions are only increasing in necessary, especially considering the macro environment, and professional firms looking to be productive, and it also why we've got so much expansion opportunity in the existing base. So, if a company has SmartVault or Virtual Cabinet, we, in future, will look to sell to them, dock down, quotas, and Hello Plan as well.

15:02 As discussed earlier, we have, really deep integrations into the core software that our professional service firms use. Just pulling out some examples. For accountants in The UK, TaxCalc is an, a disruptor in the tax cloud cloud tax space, with over 9,000 accounting practices. They resell us as a document match management module, with SmartVault. Turnkey, is a leading provider for the insolvency market. I think it has approximately 80% of the insolvency market, and, they've got a referral relationship with Virtual Cabinet where they refer, Virtual Cabinet clients who need document management.

15:53 ERP users will be familiar with NetSuite. We've done a lot of work with NetSuite over the last eighteen months to fill productivity holes within their application, and we are now building value within that ecosystem and brand recognition within the ecosystem so that we've got a strong referral channel through NetSuite. And those who are familiar with The US market will know that Intuit is probably the largest provider of small business accounting software in the world and also has a large practice management division that where they sell products including tax to accountants. They refer SmartVault. So you can go on the Intuit website, and you will see SmartVault as a product in which, is essentially part of their portfolio.

16:43 So we we've created there there's many more of this, and and we've created this competitive advantage by these deep integrations into this mission critical software that are unique to us in many cases and in which is very, very difficult for, anyone else to come into and disrupt or, get access to the same sort of APIs that we've had to create these deep relationships. So, that gives us great confidence that we've got this unique, position to grow on. And we know the sizes of these customer bases, and we know that there's a lot more growth within them. So even if we just continue to execute effectively on the areas in which we've got competitive advantage, then we should be able to see significant growth over the next couple of years.

17:36 And I think we've now been very well proven. So our applications, meet the requirements of high quality professionals. We've got over 70 thou 3,000 paying users. We've got 30% of the The UK top 100 accounting firms. I think recently, we just made an announcement that we won another really large insolvency firm. We think that there's there's many more of the top one hundreds that we can win over the next couple of years. So, you know, with the the brand recognition now we've got the proven case studies, the unique integrations, that gives us great confidence that the existing applications we got plus the new ones in which we've acquired or built over in the last couple of years will drive more adoption of of more customers well into the future.

18:31 Great. Thanks, Daniel. So we're doing all this in some very attractive, large, resilient markets. Just worth noting at this stage that we're not seeing any material impact from the current economic uncertainty on our customer base. Our view is that with inflation specifically, that is a net enhancer to our growth drivers. The wage inflation that we're seeing within professional

19:03 services firms ultimately improves the ROI of our products. That combined with the tight employment market for a lot of our customers is also driving them to look at options to improve the productivity of their existing staff rather than necessarily bringing on additional staff. So ultimately, we see that as helpful to the markets we operate in. Very specifically within the insolvency market, of course, some of the financial distress that companies are finding themselves under is directly beneficial to that market. So the markets we're in have some very favorable tailwinds associated with them, and I'll come on to those in just a second.

19:52 But these this slide defines the markets that we operate within.

19:57 The accounting and professional services market in The U. S, UK, Australia and New Zealand, we expect that to be roughly a seven fifty million pounds opportunity for

20:11 the markets there. If you divide that down into smaller chunks, The U. S. Small and medium sized accounting and tax preparer market, so again, that's anything from 20 to 30 users and down, We estimate that that's about £200,000,000 ARR space. So we are around about 5% penetrated in that space. We still see a lot of greenfield opportunity. Many of the customers who come to us are coming from potentially a Windows file structure. Some of them even still come from physical files, say paper files, and some of them come from generic solutions like Dropbox and Box. So we see still see a very strong opportunity for our products in these specialized markets.

21:00 The financial services market in those four territories, we estimate to be in excess of GBP 1,000,000,000 ARR opportunity. Specifically within that, we're looking at the

21:12 mid market banking space in The U. S. And again, with our certified Vault product, we're looking very specifically at the asset finance space there. And with Workhero in the ERP enabled business space, we see that as around about GBP 1,000,000,000 opportunity at least. The initial focus there is on NetSuite. NetSuite has about 31,000 customers. And that in itself is worth many hundreds of millions of dollars. There are opportunity for us. So what drives those markets? We believe there are four very strong and structural drivers to the markets that we serve. First of all, professional services firms and most notably accountants have come under a lot of cost pressure over the last few years, not only from wage inflation more recently, but also from the increased regulatory burden. So as those firms build out their compliance departments

22:13 and as they recruit people who are generally more used to using technology, we're seeing some very significant digital transformation programs taking place within those firms. And we believe that will continue right up and down the market for many years to come. Privacy legislation has been increasing around the world, obviously, or five years ago. The headline piece of privacy legislation was GDPR within the European Union.

22:42 That provided a very nice tailwind at the time for our UK business. We don't solve all of the GDPR or proceed puzzle, but we're a core part of knowing where your information is, who has accessed it. And if you're subject to a subject access request, then our software helps you to respond to that in a very efficient way. Now we're seeing GDPR like legislation being rolled out across the world. And specifically in The US, this is being rolled out in slightly different flavors from state to state.

23:14 Currently, there's about five states who have actually enacted legislation. The most notable of those is California with the California Consumer Privacy Act. And we're seeing similar legislation work through the statute books in most of the other states in The U. S. Now this just provides a favorable tailwind for us that raises the awareness of keeping your data secure, of knowing how to access data about a specific subject and knowing who has had access to your data and documents in the past, all of which are favorable themes for our business.

23:53 We've been seeing a shift towards hybrid working amongst businesses for many years. COVID, for very obvious reasons, accelerated that significantly. We now believe there's a structural change in the professional services market where to recruit and retain top people, hybrid working is here to stay. Our products help professionals

24:15 to work from anywhere, whether it's in the office or anywhere else in the world, securely and productively. So we see that as another favorable trend for our business. And more generally, the increased awareness and response to cybersecurity threats, again, is helpful for our business. We our products act as one of the first lines of defense for keeping sensitive data and documents secure. So we see as the wallet sizes for cybersecurity start to increase, that we will share in some of that.

24:48 So all of this enables us to bring on board very sticky customers. And this is an example of how we can sometimes apply a land and expand strategy with our customers. This particular example is for a top five accounting firm in Australia and New Zealand. We initially won the Christchurch office in this particular firm back in the beginning of twenty sixteen and very swiftly rolled out the virtual cabinet application to Queensland, Auckland, and the East Coast Sydney office as well within the following few months. Over the following year, Adelaide and Perth were also added to that. So from the moment we installed that first office in Christchurch to where we are today, we see a 17 fold increase in the annual recurring revenue from that particular customer.

25:43 And as that firm itself grows, we also benefit from that as well. So taking those six sites, we initially installed just over 1,200 users. As of today, that number is about 63% higher, just under 2,000 users. This is an example of how the sorts of clients we win, we can initially land and then expand within those firms and build out reasonably large enterprises.

26:13 So looking to the future, we announced last year our plan to at least double ARR within the next five years. We believe we have the right team, the right products, and we're operating in the right markets to do that. So you can expect from us, sustained double digit growth in annual recurring revenue. ARR will remain our focus.

26:37 Over time, whilst we'll be reinvesting for growth in the short to medium term, over time, there is nothing within our business that structurally shouldn't enable us to become a 30% plus EBITDA margin business as we reach maturity. Now we've already proven that with our Virtual Cabinet business, which on a stand alone basis has an EBITDA margin in excess of 50%. So we've already tried and tested that model. From a cash point of view, we operate at a broadly neutral operating cash flow position, and that enables us to reinvest with a lot of confidence for growth. So as we just summarize the results for the first half that were published this morning. Annualized recurring revenue, or ARR, which is our revenue run rate, our subscription revenue run rate and is absolutely key to any subscription software business like ours, was up 21% at constant currency to £18,100,000 That now means, just over 94% of our revenues are recurring in nature, and that's actually the highest on AIM. We expect that to increase a little

27:47 bit further over the next few months as well. So that ARR growth came from a combination of an 8% increase in our paying users and a 15% increase at constant currency in our annual revenue per user. So a combination of volume and pricing drove that growth. The bottom left there, our average revenue per customer, average revenue per account, was just over GBP 2,000. That's actually up about 29% at constant currency on the same time last year. Our churn rate improved from 1% per month to 0.9% per month. So to be clear, that is the proportion of our revenue base that disappears from customers who are leaving us every month.

28:33 And that compares very favorably to the typical SME churn rate, which is around about 3%. So with more than half of our business selling into the SME market, we're very pleased with that level of churn. It's more of a testament to the fact that the customers we sell to are very sticky and also the fact that our products tend to be relatively infrastructural in nature once they've been implemented. Our net revenue retention improved from 99.3% to 100.6. Churn has obviously helped with that, has had expansion revenue and as has our fair price monetization efforts, where we've been pricing and packaging customers in a fairer way.

29:19 Our LTV to CAC ratio is a measure of customer acquisition efficiency. So that's, as Daniel was saying earlier, if we invest GBP 1 in acquiring new customers, so sales and marketing costs, over the lifetime of that customer, we get £4 back. That's a very predictable number. We've got very predictable churn rates. We obviously know our pricing. And that, for us, is the reason why we continue to invest for growth. So taking a look at how our ARR has moved over the course of the half. We started the year with £15,800,000 of ARR. We acquired £900,000 of new customers, and that's down ever so slightly on the first half last year, but against the backdrop of a very much COVID rebound at the beginning of last year.

30:14 Our monetization efforts led to an extra $1,500,000 of ARR. Roughly twothree of that has come from our SmartVault business and about onethree from virtual cabinet. We started smart vault monetization back in November last year. Virtual cabinet was started in April, of this year. So we're still quite early on in that virtual cabinet journey. Churn led to a reduction in GBP 900,000. That compares to GBP 800,000 in the previous year and is better in terms of run rate. And the stronger U. S. Dollar, with just over 50% of our revenues being denominated in U. S. Dollars, led to a GBP 800,000 increase as well. So looking at our P and L.

31:03 Our recurring revenue was up 19%. Total revenue is up 18%. We expect our nonrecurring revenues, and this includes things like migration fees or consulting revenue, to be flat to slightly down in the future. Our focus is very much on subscriptions. We now package much more work into the pure subscriptions that we get from our customers. So our focus is very much on that recurring revenue line. Our gross margin at 90.4% was down slightly in the first half last year. That's a product of the mix, so greater volume of our business in our pure cloud products where we bear the cost of operating those products. Typically, those products are operating at about 85% margin. So as the mix moves more towards products like smart vault, you'll see ultimately our gross margin normalizing to somewhere between 8590%.

31:56 Our adjusted EBITDA in the half was roughly at breakeven. Adjusted EBITDA includes 0.7% of capitalized sorry, 700,000 of capitalized development costs. So we present both an adjusted EBITDA number and adjusted loss number, which effectively is the sort of pure see through P and L number. We've shown this cost base breakdown on the right before. Very roughly 75% of our costs, as with many software businesses, are related to the people that we have and incentivizing those people. So there hasn't been any structural change, to the makeup of our costs there. Looking at cash, there are two structural components that help us to operate in the long term at a small accounting loss position. And that's the benefit we get from deferred revenue. So well over 65% of our customers pay us annually in advance.

33:00 As we grow, that funds an awful lot of growth. Typically, we see deferred revenue benefits, are slightly better in the second half than the first half. And the second structural benefit we have is we are a recipient of UK R and D tax credits that typically derive us about £750,000 benefit annually, net of other taxes we have to pay around the world. So at the end of June, our cash of $2,100,000 was up 7% compared to the same period last year. We've got a GBP 2,000,000 loan facility with Silicon Valley Bank, which is completely undrawn, giving us just over GBP 4,000,000 of cash firepower. So just worth stressing at this point, we consider ourselves to be adequately funded.

33:46 We don't see a need to raise additional capital. The structural advantages you get from a SaaS business where you are selling to customers who pay annually in advance is extremely powerful to fund future growth. So just moving on to the outlook. Our focus, unapologetically, remains building our base of recurring subscription revenue, which we consider to be highly valuable. It's a very predictable revenue base. It enables us to invest with confidence for growth. Our customer acquisition process is very scalable, so we know that investing in that. We know what the return is that we'll get off the back of that.

34:34 And we believe that our customer base is in a very valuable and attractive market with some very favorable tailwinds behind it. So our strategy is very clear. We aim to build long term growth in those recurring subscription revenues. We have a portfolio of SaaS software solutions, each of which operates in some very large markets. Our gross margins are high, and we have profitability proof points within the business. So Virtual Cabinets EBITDA margin in excess of 50%. That gives us confidence that we have a road map to cash flow positivity and ultimately strong EBITDA margins in the future.

35:24 As Daniel said earlier, very typically in businesses like ours, SaaS multiples are ARR multiples that are applied are typically somewhere between five and ten times. Ultimately, our aim is to get the business where it is perceived with such quality that it starts to attract those kinds of multiples as well. So just before I wrap up, just worth flagging that Pammiour Gordon, our new broker, initiated coverage on us today. You can find on our website, getbusyplc.com, a summary of our analyst consensus if you need numbers for the next few years. And of course, as always, we are always available for questions. You can contact us through our website if if there's ever anything which you need to understand better. And with that, thank you very much.

36:18 Daniel, Paul, thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions just using the q and a tab situated in the top right hand corner of your screen. Just while the company take a few moments to review those questions submitted today, I'd like to remind you that recording of this presentation along with a copy of the slides and the published Q and A can be accessed via your investor dashboard. Daniel Paul, as you can see we've actually received a number of questions throughout today's presentation, and thank you to all the investors for submitting those. Could I just please ask you to read out those questions and give responses where it's appropriate to do so? And then I'll pick up from you both at the end. Of course. Excellent. Thank you very much. So should Paul and I will share the questions, one each. Paul, do do you wanna start? Yeah. That sounds good. Apologies if there's any clunkiness to these people.

37:07 Daniel and I can't see each other at the moment, so we're gonna be trying to guess who's doing which questions. But first question, here are a few pre submitted by Alessandro. I understand that a recent presentation said new round of monetization started in November 2021 and will continue for two years. What proportion of subscribers have had their monetization completed so far? And what proportion will have it completed at the end of October twenty twenty two? So I talked about this a little bit earlier, Alessandro. So our SmartVault monetization kicked off in November last year. That is now got a couple of months left to run essentially. So a good proportion of that those customers are already on new pricing. Virtual Cabinet kicked off in April and probably less than 20% of customers there have migrated onto e pricing. So that's still got some way to run.

38:04 Your next question, I think, is actually dealt with by my answer just then. So I'll move to your next question, which is Document Vault, as you mean, Certified Vault and GETBUSY. As you are aware, they could have a big potential, especially Certified Vault. I understand your rationale for not presenting all the future sales details in the different products with GETBUSY PLC. However, could you include an update in each half yearly report on the ARR from these two businesses? That will allow people to gauge how these new activities are scaling as well as their future potential. So in summary, we don't plan to disclose separate ARR for those products at this stage. That simply isn't fair on the teams that are taking those products to market. They don't need to be doing that, frankly, in the full scrutiny of the public markets.

38:57 But also at such an early stage in SaaS businesses, you know, you can get a lot of false positives and false negatives. So it's simply not helpful to anybody at the moment. You can rest assured that the moment that we have interesting strategic things to report on either of those businesses that we will we will do so through r and s announcements. Cool. Next question's from sorry, Paul. Were you were you finished with that one? Yeah. Yep. Okay. Next next question is from Mazin. It says, what makes you confident that you will not need to raise more capital? Well, I think, Mazin, thank you for your question, first of all. A couple of things make us extremely confident that we won't need to raise additional capital.

39:46 One is, if you look at over the last probably eighteen months and look on a twelve month, basis, we've been cash generative. So as Paul described earlier, there's some core structural components of our business that enables us to generate cash even if we have a accounting loss. And then on top of that, because our revenue is so predictable and our return on investment is so consistent, we are well in advance able to understand what kind of cash we would generate from the cost in which we're putting into the business today. So as a result of that, and because of the numerous proof points of SaaS companies moving to high operational leverage of twenty, thirty to 40%, we are extremely confident that we will not need to raise raise any capital.

40:46 And we think that in the near term, we'll start to generate a lot of cash. Superb. So I'll take the next question, Dan. This again is from Maazin. How productive has the additional sales and marketing related investment in SG and A been? Should we expect SG and A to flatten out next year or is more investment planned? So specifically in sales and marketing investment, our LTV to CAC ratio, I think, the impact of that. So that four:one LTV to CAC ratio has been very robust over the years. So incrementally increasing sales and marketing spend absolutely makes sense for us as a business at the moment.

41:39 Other SG and A, we would ultimately expect to flatten out, but I would say not yet. As we build out the infrastructures for specifically certified Vault, We see that as a very substantial opportunity, but not one that we can do without putting in place certain sort of regulatory and compliance capabilities within that business as well. So you'd expect to see us ultimately still reinvesting most of incremental revenues back into the business over the next couple of years. It's from Alan. Hi, Alan. Well, I think I'm sorry, Paul. Sorry to jump in. I think I think we've missed one from Ben b. So do you mind answering that one? And then I'll jump on to Alan's two questions.

42:30 Yeah. I'm trying to see that. Alright. So down a bit further down. Here we go. I'm sorry. Your order is probably slightly different than mine. Yeah. Sorry. Your analyst consent to suggest No. No. There's one before that. Oh, sorry. There's one before that. It says, can I ask why trade payables have increased by approximately 1,300,000 over the last twelve months? If you put aside tax leases and deferred revenue for the moment, it leaves net cash at effectively point 2,000,000. With your 2,000,000 facility available, of course, do you believe that is a little tight? Yes. Great question, Ben. So in summary, no, we don't believe that tight. Within that number is an element of the Social Security accrual that we have to make alongside share option costs.

43:20 So there is zero chance of all of those liabilities crystallizing at the same time, if you like, but we have to report them within our current liabilities number. In addition, there's incremental sales commissions and those sorts of things within there. So the current liabilities number, the trade and the payables number, which is also impacted, by the way, with currency for our U. S. Payables, is simply will not unwind overnight. So we're able to forecast out those cash flows with a high degree of confidence. So to answer your question, is that a bit tight? We certainly don't believe so. And specifically, when you layer on the cash generation we get from new customers and also the debt facility we have in place with Silicon Valley, which is completely undrawn, we have no concerns around that.

44:18 Excellent. I'll jump on to the question from Alan f. Beyond the additional additions of resellers, are you able to share examples of tangible project progress with, e e g winning a large customer or current number of customers? Great question, Alan, and one of my favorite ones to answer. We've we've definitely seen some real tangible progress in the as you've alluded to, the most tangible progress is winning customers. A really good example is, as per our announcement last week, a top 200 sorry. Top 100 accounting firm took on both Work Hero and Virtual Cabinet, and we're seeing more and more of that where work virtual cabinet clients are starting to see the value in Work Hero and buying both of our applications.

45:12 We're also starting to see some significant wins within the NetSuite client base. So it is another good example of that. I won't name the company because it's not right to do so, but that company started with one of their divisions, and I think we've grown out to three other divisions since then. And and their customer sentiment has been very, very positive. So, we have loads of of active customers now. We're continuing to monitor their usage and the value in which we're providing and all of those leading indicators are pointing in the right direction. Another question from Alan f. Appreciate focus is on future growth, but when should shareholders expect to see the scale efforts discussed produce significant free cash flow, short, medium of five year greater than five years?

46:08 Well, Allen, I think that's dependent on what kind of return on investment we get for our customer acquisition spend. So it makes a lot of sense for us to continue to invest when we're getting returns of £4 for every £1 in which we acquire customers. And the value of that over a medium long term means a substantially more cash generative business. So we we we are confident that both SmartVault and Virtual Cabinet are at positions of scale now, and I think we've seen significant cash come out of Virtual Cabinet. I think in the short term, we're gonna start to see significant cash be generated from SmartVault.

46:59 And then from our perspective, the operational platforms we've got in place are relatively mature. So it is, very much a discussion of whether that additional cash, is best used by investing in new customer acquisition or flowing down into profits to be distributed to shareholders or used for acquisitions. So we are very much at that place of maturity where we're we as a board are discussing that regularly and constantly evaluating what the best use of the capital we are generating is. There's one more here from Alan F, and then I'll let you jump on to Paul L's questions. Does the company provide its own digital signature technology or just resell DocuSign?

47:49 If it makes, can you explain why? Great question, Alan, again. So for Virtual Cabinet and Work Hero, we use our own, and we build our own e c signature technology. Yeah. For SmartVault and CertifiedVault, we use DocuSign. And there's a couple of reasons behind that. First of all, DocuSign's brand recognition within The US is highly valuable for us. Second of all, there's some unique functionality that DocuSign does for US customers, which our current esign, products don't do. And then, finally, there there is quite a bit of work to integrate, the esignatures solutions that we got in Virtual Cabinet and Work Hero into SmartVault and Certified Vault. So, it's something which we're monitoring closely.

48:44 We know that our margin on our signature solution is far greater than that of DocuSign. So over time, we expect to, move away from DocuSign into our own applications, but we'll only do that when that makes sense and when our applications are mature enough to deal with customer requirements. Great stuff. Thanks, Daniel. So a few questions here from Paul. Actually, Paul, I think some of your questions might have just been answered through some of Alan's there around what level investments we expect in product and customer acquisition over the coming years. If that hasn't answered your question, you'd have to get in touch with me. There's another question here, though, around talk about the significance of adding four value added resellers to Work Hero.

49:33 And to what extent are these intermediaries proven revenue generating products like Work Hero? And to what extent are they maybe a growth option? So the value added resellers are a very core part of the NetSuite ecosystem. So typically, these resellers have sometimes very large bases of existing customers who use NetSuite and who they provide additional technology options consulting projects and and that sort of thing. So all of the resellers we operate with sell other products into the NetSuite ecosystem as well. So to that extent, it's a very well proven path. We also sell directly through NetSuite and directly ourselves as well. So NetSuite is a is a reseller of the Work Hero application.

50:24 Work Hero appears within the SuiteApp app store. So we have a number of channels through to to to that market. Cool. Alright. I'll sorry. Go for it, Paul. No. Go for it. I was gonna jump under Dave's question. Have you finished with Paul L? I'm not gonna take the blockchain one, so you can definitely take this one. This is a great topic. We're gonna probably need another hour or four. But is there a risk to venture cabinet from the advancement in blockchain tech? Dave, great question. And as I said, I would love to take that offline and talk in more detail with you about it. But, no, there there's no risk in that.

51:12 In future, if blockchain matures to a point in which it's, as efficient and more secure than how we're currently storing customers' information, then we can rearchitect our product to talk to a blockchain back end. So we're monitoring it very closely and understand the technology extremely well. And so we think it'll be advantageous for us in the future rather than disruptive. There's another one here from okay. Go go from Martin. You're taking the other one from Dave. So am I correct in that you do not have any of the top UK four UK accounting firms' clients? Do they have their own proprietary solutions? And and what are the chances of you securing one or more as a as a customer?

52:02 So I think first thing to say is, yes, usually, these guys do have their own proprietary solutions. They're very different beasts to sell into and to serve than anything from, you know, number five down. They're also not homogenous organizations. So typically, you know, an organization like Deloitte or PLC is an amalgamation of of of lots of, you know, different service lines that usually operate on different technologies. A great example would be, you know, within a larger counseling firm, you might have different practice management provider for the tax team. It might be Iris or something like that. Then you would have to the insolvency team, which might be Turnkey IPS. Now where we have had some success is where some of those large accounting firms have spun off their insolvency divisions in order to create independence between the or to remove the seed conflicts between audit and and insolvency.

53:04 We have been able to pick up some of those recent spin offs as well. So whilst they don't have the big four brand anymore, they are, you know, very substantial insolvency operations in their own right. But it's not a market that we are actively going after the big four. K. I've got a question here from Martin s. How significant is Work Hero's revenue? How quickly can this grow? What is the relative price of Work Hero versus SmartVault? So as Paul, explained earlier, we don't disclose Work Hero's ARR at the moment. It could grow extremely quickly. It's the largest addressable market in which we're currently playing in, with, what seems to be the most significant problem to be solved.

53:54 So I I think over time, Work Hero can be bigger than both our smart vault and virtual cabinet businesses combined. And what is the relative price? Work Hero currently is, a lower average sale price than SmartVault. That's because it's new to the market, given the size of the customers, and as significance within their tech stack, I expect Workera to be priced higher than SmartVault, but that will likely take a couple of years. Good stuff. I think we're going to to to be very selective on the question, because I don't think we'll get through all of them. So I'm going to try and batch them into some themes. We've got a couple of questions here on certified Vault. First of which is from Catherine T. Could you give us a bit more detail on the response you've had to the certified Bolt solution to date?

54:45 And what extra work you're doing to prepare the product for its wider launch? And a related question here from Sebastian. Can you expand on the reasons why you pulled back from promoting the certified Vault product? So Catherine, to answer your question, the response we've had to certified Vault today up to date has been very, very encouraging. We saw that towards the end of last year. This is a market which is crying out for digital solutions to help them do business in a more efficient way. There's currently only one other provider of any scale in that market. So, you know, we provide very useful optionality for prospective customers. So, so far, the response has been very good. However, it is a market where we need to make absolutely know what we're doing before we really push our foot to the floor of the accelerator.

55:40 We are building out some of the compliance elements to the product. The security requirements of some of these larger enterprises are very different to the security requirements of our SME base. And we want to make sure we're getting those absolutely 100 right before we push very, very hard for growth in that product. So we were very pleased with the reception that the prototype product got towards the end of last year. We will be moving the product on over the next few months and anticipate being able to launch the product in a, you know, a much more aggressive way during the course of of next year. Cool. Paul, should I quickly try and bash through some of the business questions and then leave you to finish on the questions around the analyst consensus?

56:33 Yep. Go for it. So there's a question around paying users with static half and half. Please explain. Well, static users were actually up sorry. Users were up 8%. Said more growth came from average revenue per user increase than only 8% in paying users, rising prices, one trick pony. Paul, I think sorry, Alan. I think it's important to acknowledge that, the average revenue per user increase was not just a price rise. It was about providing additional capabilities and features to the existing client base. So and it was moving old client bases onto new onto current pricing. So, a lot of it's not just related to price rises about adoption, a greater adoption within our customer base of applications, and that we can do over and over again for many, many years, especially as we build out more capabilities.

57:31 There's a question here about what kind of uplift was there in ARR due to inflationary. I think we've answered that around the the average revenue per user. The last three halves have shown you ARR growth of 0.8, 1.6,900,000. Is this seasonality or was h two exceptionally high? I think it is a function of having a really good half and us affecting us being very effective on our monetization, new customer growth, and protecting churn strategy. I think there's another one around average price that we've got, and then Sebastian's asked around, appreciate you have signed five new NetSuite partners.

58:22 And then I think that's a question again around customer wins. And and as I explained earlier, we've we've seen a good number of those come through recently, and, we expect that to continue. I'll jump on one final one from Mark. Is there interest in the business from private equity or historically had liked by SaaS players? Really great question. The we're we're building up strategic significant strategic value in core client bases for very large organizations and our access to competitive clients or a big percentage of their clients is material. And we know that the kind of multiples applied to SaaS businesses are healthy because those who work a lot with SaaS businesses know the future cash generation of them. So we understand our strategic and potential value, we're too way too early to materialize that.

59:24 We wanna continue to build and scale. In the future, we will look at lots of different ways to maximize shareholder return. Paul, do you want to hand over to you for the analyst questions? Yes, absolutely. I'll take so Ben has asked, your analyst consensus suggests you'll be still loss making for FY 'twenty four. I'm surprised we're still looking at another two point five years runway to profitability and cash generation, nor have I misunderstood. So I think we've addressed this earlier, Ben, with our approach of reinvesting incremental revenues back into growth. Key for us is that LTV to cap ratio. Whilst we're still seeing that at four:one, it 100% makes sense for us to reinvest all we can back into growing the business.

1:00:11 So we have additional products within the portfolio that we'll also be looking to scale to basically fuel long term or add to long term growth as well. So P and L profitability for us is not a focus in the near to medium term. Using the cash resources that we have and managing our cash flow with the advantage we get from customers paying in advance is absolutely a focus of ours. And the final question, if the investment company team will allow me, from Sebastian. Appreciating that our analyst forecast rather than yours, Pamir Gordon are forecasting revenue growth in 'twenty three, dollars 500,000 of EBITDA, consuming 700,000 of cash. Can you explain why the profits and cash performance is forecasted to diverge in 2023?

1:01:00 So you're looking there at EBITDA number, Sebastian. You'll need to look through the adjusted PBT number in that Panmure Gordon note as well. And I think you'll see that we are cash additive to that as well. Ultimately, all of the workings there in the Panmure note. So you'll be able to you'll be able to see how they have modeled out cash flow over the next couple of years. Daniel and Paul, I think you've actually managed to address every question from investors there and of course the company will review all questions submitted today and will publish those responses on the Investor Me company platform. But just before redirecting investors to provide you with their feedback, which I know is particularly important to the company, Daniel, could I just ask you for a few closing comments? Yeah. Thank you everyone for your time. We we greatly appreciate it.

1:01:50 We're very ambitious and optimistic about our future and remains committed and confident that we will double our ARR in the next five years as we've set out as a strategic initiative. Perfect. Daniel, Paul, thanks once again for updating investors today. Could I please ask investors not to close this session as as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of GETBUSY PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.