Bailador Technology Investments Ltd · ASX:BTI
Bailador Technology Investments — Investor Presentation (August 2015)
40 slides from Bailador Technology Investments's investor presentation, Aug 20, 2015
Slide 1: Investing in Technology the Smart Way
For personal use only Investing in Technology the Smart Way Bailador Technology Investments Limited (ASX:BTI)
Slide 2: Disclaimer
Disclaimer For personal use only Bailador Technology Investment Ltd (Bailador) does not accept liability to any person, organisation or company for any loss or damage suffered as a result of reliance on this document. All statements other than statements of historical fact are, or may be deemed to b
Slide 3: Technology is changing our lives
Technology is changing our lives For personal use only How we… 15 Years Ago Today Make a phone call Bank Search for business information Purchase a book Book a hotel or flight 3
Slide 4: We are all familiar with just how large some technology companies can become
We are all familiar with just how large some technology companies can become… For personal use only Description Market Cap US$ Year Founded Technology company, consumer $647BN 1976 electronics, personal computers. Search engine, advertising $463BN 1998 technologies, software. Manufactures, licenses
Slide 5: Tech giants you may not be as familiar with worth at least US$10 Billion
…and there are tech giants you may not be as familiar with that are worth at least US$10 Billion. For personal use only Description Market Cap US$ Year Founded Cloud-computing CRM software. $47BN 1999 Mobile app for on-demand taxi $40BN* 2009 services (using drivers own cars). Website to rent out pe
Slide 6: Overall technology sector returns have been strong
Overall technology sector returns have been strong For personal use only Return (% p.a.) for the period ended 30 June 2015 1 Year 2 Years 4 Years iShares Global Technology Index 8.8% 18.4% 13.1% NASDAQ Internet Index 8.4% 23.5% 17.9% NASDAQ 100 Technology Index 9.0% 23.8% 14.6% NASDAQ Internet Index
Slide 7: The technology sector is a credible portfolio allocation
The technology sector is well established as a credible portfolio allocation For personal use only Is some of your portfolio allocation to technology investments appropriate? 7
Slide 8: Foundations for technology sector development are solid macro drivers
The foundations for technology sector development are solid macro drivers For personal use only Sustained Technology Industry Growth – not a dot.com bubble Drivers Impact ü digitisation of information ü increased computing power Changing industry dynamics ü broadband proliferation General ü wide
Slide 9: Internet-related companies delivering far higher returns than traditional rivals
Internet-related companies in all sectors are delivering far higher returns than traditional rivals… For personal use only 3 Yr Price Appreciation, % Oroton MYER Wal-Mart Retail EBAY Barnes & Noble Overstock.com HTC Corp Mobile Apple Devices Hewlett Packard Flight Centre Priceline Group Leisure Corp
Slide 10: Investment in internet-related companies requires specialist knowledge
… but investment in internet-related companies requires specialist knowledge and expertise For personal use only Price appreciation since IPO of recently listed internet-related companies on the ASX and NZX 250% 200% 172% 200% 121% 150% 93% 89% 75% 65% 100% 58% 52% 43% 50% 10% 0% -5% -8% -50% -30% -
Slide 11: How to reduce risk when investing in the technology sector?
How to reduce risk when investing in the technology sector? For personal use only The probability of achieving consistent investment returns in the technology sectors is improved by the presence of the following factors: Specialist The appropriate technology sector stage of company expertise develop
Slide 12: Bailador is a specialist expansion capital investor in technology
Bailador is a specialist expansion capital investor in the technology sector For personal use only • Technology related businesses focusing on software, internet, mobile, data, online marketplaces Information and telecommunications related businesses Technology Sector • Changing industry landscape c
Slide 13: Bailador has a proven track record investing expansion capital
Bailador has a proven track record investing expansion capital in the technology sector For personal use only Returns Since 1 Year 2 Years Time Period Inception Annual Return Annual Return Annual Return Bailador portfolio annual 18.8% p.a. 30.3% p.a. 22.7% p.a. investment returns Returns: Gross port
Slide 14: How to reduce risk when investing in the technology sector?
How to reduce risk when investing in the technology sector? For personal use only Specialist The appropriate technology sector stage of company expertise development Capital structure Diversification and contractual through a portfolio protections of investments 14
Slide 15: Bailador is a specialist in the information technology sector
Bailador is a specialist in the information technology sector For personal use only Bailador has access to extensive deal flow by leveraging its reputation, relationships and track record High Value Education 370 Telco Information Apps and Internet Deal Leads Services Transactions 4%$ 2%$ Social Net
Slide 16: Bailador employs proven investment criteria
Bailador employs proven investment criteria For personal use only Bailador’s strong position in accessing high quality deal flow enables it to focus on investments which meet its key investment criteria: Highly profitable Proven unit Technology economics ü Huge Global × No start-ups Addressable Glo
Slide 17: How to reduce risk when investing in the technology sector?
How to reduce risk when investing in the technology sector? For personal use only Specialist The appropriate technology sector stage of company expertise development Capital structure Diversification and contractual through a portfolio protections of investments 17
Slide 18: Expansion stage companies provide an attractive balance
Expansion stage companies provide an attractive balance For personal use only Lower risk than start-ups while retaining the prospect of exceptional returns Return Start-up Early Stage Expansion Stage Large Listed Risk Size and stage of development determines the risk-return profile for internet rela
Slide 19: What does 'Expansion Stage' mean?
What does ‘Expansion Stage’ mean? For personal use only Companies in the expansion stage have proven that they are a genuine viable business usually with several million dollars in annual revenue Why Expansion Stage investing? • Technology is de-risked compared to early stage companies • Proven reve
Slide 20: What does a typical expansion stage investment opportunity look like?
What does a typical expansion stage investment opportunity look like? For personal use only Ability to 2-6 years of Proven business Run by Founders generate repeat operation model revenue Significant portion of Huge growth Key 2nd level Needs capital to revenue opportunity in management grasp opport
Slide 21: How to reduce risk when investing in the technology sector?
How to reduce risk when investing in the technology sector? For personal use only Specialist The appropriate technology sector stage of company expertise development Capital structure Diversification and contractual through a portfolio protections of investments 21
Slide 22: Bailador manages risk through capital structure seniority and contractual rights
Bailador manages risk through capital structure seniority, contractual rights and deep involvement with management For personal use only These protections are unavailable to retail investors in public companies Risk Management Implication Feature The Bailador Start Return approach reduces Up Seniori
Slide 23: Convertible Preference Shares allow exposure to full equity upside
Convertible Preference Shares allow exposure to the full equity upside… For personal use only As long as the business is sold for > Bailador’s entry Through its conversion rights, Bailador receives full cost, Bailador will receive all principal invested participation in equity upside achieved “Downs
Slide 24: How to reduce risk when investing in the technology sector?
How to reduce risk when investing in the technology sector? For personal use only Specialist The appropriate technology sector stage of company expertise development Enhanced Diversification structural through a portfolio protections of investments 24
Slide 25: A portfolio of investments diversifies risk
A portfolio of investments diversifies risk For personal use only Bailador currently has five portfolio investments which have been selected from nearly 400 investment opportunities reviewed Cash & Other 13.5% Straker1 5.3% SiteMinder iPRO 36.9% 8.6% Viocorp 27.6% SMI 8.1% Bailador anticipates makin
Slide 26: BTI provides immediate exposure to an established portfolio
BTI provides immediate exposure to an established portfolio with material upside prospects For personal use only Value Position & Upside Potential ($M) 25.0 World leader in travel distribution technology growing rapidly in a strategically valuable space 18.7 Regional leader in online video with prov
Slide 27: Multiple exit options for high growth internet related businesses
There are multiple exit options for high growth internet related businesses For personal use only Descriptions Examples • Legacy incumbents buying growth and/or Acquirer Target defensive positions • Established internet or software companies buy bolt-ons and/or defensive Trade Sale positions to larg
Slide 28: Summary
For personal use only Summary www.bailador.com.au Bailador Technology Investments Limited (ASX:BTI) 28
Slide 29: Investors now have access to expansion stage technology investment
With Bailador listing on the ASX, investors now have access to expansion stage technology investment For personal use only Unprecedented access not previously available to retail investors Expansion Start Up Early Stage Stage IPO Listed • Friends and • Friends and • Investment • Institutional Family
Slide 30: History of Bailador Technology Investments Ltd
History of Bailador Technology Investments Ltd For personal use only 2010 2011 2012 2013 2014 2015 Bailador Trust BTI founded founded $62.5M shares + $20M capital $62.5M options Investment Investment Bailador Investment Investment Technology TCV invest Investments $33M in (BTI) listed SiteMinder on
Slide 31: The Managers of BTI
The Managers of BTI For personal use only David Kirk, MBE Paul Wilson Chairman and Director and Portfolio Portfolio Manager Manager • Former Chief Executive Officer of publicly listed Fairfax • Director of CHAMP Private Equity in Sydney and New Media Ltd. York, and with MetLife in London. • Led succ
Slide 32: Dividends and Manager Remuneration
Dividends and Manager Remuneration For personal use only • Cash dividends will be paid when portfolio investments are sold. Dividends • Dividends will be franked. • The Manager intends to retain Franked dividends will enough cash to fund one year of be paid as investments investment. are realised. •
Slide 33: Investing in Technology the Smart Way
Investing in the Technology the Smart Way For personal use only Access to the high • Technology is reshaping almost every industry growth technology • Creating high growth companies with huge potential upside sector • Access to these companies is available through Bailador Reduced risk • Expansion s
Slide 34: Thank You
For personal use only Thank You www.bailador.com.au To keep up-to-date with Bailador and the latest news on our portfolio, follow us on LinkedIn. www.siteminder.com www.viocorp.com www.standardmediaindex.com www.iprolive.com www.strakertranslations.com Bailador Technology Investments Limited (ASX:BT
Slide 35: Appendix: Investment Portfolio Profiles
For personal use only Appendix Investment Portfolio Profiles 35
Slide 36: The BTI Portfolio: SiteMinder
The BTI Portfolio: For personal use only SiteMinder is the world leader in hotel channel management and distribution solutions for online accommodation bookings BTI Cost • $18.8m What excites us about « It is the world leader in its space for Current • $25.0m technology, market position, and scale.
Slide 37: The BTI Portfolio: Viocorp
The BTI Portfolio: For personal use only Viocorp is a leading platform provider for publishing and broadcasting video content through the web, IPTV and mobile services What excites us about BTI Cost • $16.4m « Viocorp has proven that its technology is as good as any in the world. Current • $18.7m V
Slide 38: The BTI Portfolio: SMI
The BTI Portfolio: For personal use only SMI is an independent aggregator of a unique source of advertising data in 53 countries BTI Cost • $5.5m What excites us about « SMI has exclusive access to very valuable Current • $5.5m data, and has developed sophisticated Value systems to extract and mani
Slide 39: The BTI Portfolio: iPRO
The BTI Portfolio: For personal use only iPRO is a specialised provider of cloud based vendor management software helping large corporates and government manage their contracting vendors BTI Cost • $5.5m What excites us about « It takes advantage of major industry trends: (1) Current • $5.8m outsou
Slide 40: The BTI Portfolio: Straker
The BTI Portfolio: For personal use only Straker is a leading provider of cloud-enabled translation services in more than 80 languages, leveraging its proprietary platform to scale globally BTI Cost • $3.6m What excites us about « A leading hybrid platform combining the Current • $3.6m efficiencies
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