Pci-Pal (LSE:PCIP) — Update on Fundraising

0:05 Good afternoon, ladies and gentlemen, and welcome to the PCIPAL update on the recent fundraising. To start with, if we could cover a couple of housekeeping items. Before we begin, we would like to submit the following poll, which you will see on your screens. Throughout this presentation, investors will be in listen only mode. However, questions are encouraged and can be submitted at any time via the q and a tab situated on the right hand corner of your screen or if anyone has dialed in via PCIPal at warbrookpr.com.

0:41 We will endeavor to answer all questions today. However, failing that, we will review all questions submitted and publish responses where appropriate. These will be available via your investor meet company dashboard. Finally, I'd like to remind you that this presentation is being recorded. I would like to now hand you over to chief executive, James Barham, and chief financial officer, William Good. James? Excellent. Thanks, Tom. Well, I suppose welcome back, everyone. Thank you for following us on IMC. We were just talking about how many followers we have on here now. So it's fantastic to see that because we are putting in the effort to reach out to our private investor base. And, yeah, thanks for taking the time today.

1:27 We do appreciate it. This update is gonna give you a little flavor for the recent fundraise that we just ran. It's a shorter presentation than we've been used to on here. So what I will say is if you're new to our story, please do visit our website, the investors pages or dig into the Investor Meet company portal where you can watch some of our previous presentations, which have you know, we have more time on those and we spend more on the background and the strategy. Also, our knowledge center on our website is great if you're just looking for more market information around our fairly specialist space and you want to get a look at what we're doing more generally on a sort of day to day tactical basis as well. So we will keep some time at the end for questions and answers too. Hopefully, we'll have plenty of time for that, but any that we don't get to, we'll also update to the portal.

2:22 So this is all about the fundraise, this presentation. Why now for the fundraise? Why was the timing that it was? It may not have come as a surprise to some of you, certainly, we'd had fairly consistent feedback from our half year roadshow just a month or two before the fundraise that there was quite a bit of support for pushing a bit harder from our investors. And as I stated in our last annual report, we're four years into the current five year plan that we set out since we really started on this journey with PCIPOW. And I've been working, not just myself, with William this on a refreshed version of that five year plan as well. And as part of that, naturally, we're looking out further in the next one, two years, which is what you've been able to see in the market forecasts that are out there. We're looking out to see how we can keep these rates of growth going with the same strength that we've shown in the last few reporting periods. And revenue today is growing strongly.

3:26 Our revenue growth rates at the half year exceeded 50% year on year with forecast to break 60% at the full year. The forecast already showing similar sorts of rates of growth for revenue next year, certainly 40% plus. And actually, we were getting very close and certainly within shooting distance of the first months of sustained cash generation and profit. So to get to that point and to be achieving these things, we've come a long way since we started on this journey over four years ago now. But as a SaaS business with a global opportunity, we're looking to really sustain those strong rates of revenue growth when we're looking out three, four, five years plus onwards.

4:14 And this is really and what this comes down to ultimately is how we deliver value back to our shareholders. And we see us and the best opportunity that we have to do that through the appreciation of our stock with the value of the company going up. So that's why we've done what we've done. And in terms of the timing right now, as we know from our revenue model and how IFRS 15 impacts our ability to recognize revenue, new sales bookings take some time to feed through into revenue as well. So acting right now ensures we're driving hard at those years further down the line to continue on this similar growth trajectory. But we're doing it from a much more stable base than when we first raised money, which, frankly, for this team is hugely exciting to be able to do it from this very different position of strength that we have today.

5:10 So more on that in a moment. But before I get into that detail, we'll give a bit more background and an element of the strategy as well so that we're completely devoid of that. And then we also have an update since the half year. It's the usual disclaimer. Now in terms of what we're all about, you know, our mission at PCIPow is to provide organizations anywhere in the world with secure payment solutions for business communications. So by this we mean companies taking payments by credit and debit card primarily across voice or phone as it's known, chat, social, email, messaging, any kind of communications that goes into what's commonly seen within the contact center mix or, as it was known, the call center mix or business communications as we we call it today.

6:02 And not only do we allow our customers to secure this data when they're handling payments across these channels, but importantly, we allow them to also comply with the latest data security governance and regulation that's out there. And in particular, the area we're particularly interested in is PCI compliance, but it does have a positive impact on broader regulation like GDPR, for instance. Now as a business, we're a true SaaS company, which means that whilst we're small, we can deliver our services anywhere in the world, and we can do that very cost effectively as well. And although we do talk about being global and serving customers across the world, very much our focus to date has been on The UK and The U. S. We are in our are currently in our third full financial year in The US right now, so UK business is slightly more mature.

6:52 But hence, the fundraise and and looking to expand on on these on these focus areas. Now in terms of what we do, and as I say, this is sort of simplified, so if you do need more information on this, please do look back at some of our previous presentations. But we're pretty simple on this front, so three core products. We're purposely what we call a pure play in what we do because we primarily sell through partners and in particular, resellers, many of which we're quite tightly integrated to. So we're very careful not to tread on the toes of those organizations that we work with. We're there to solve a very specific issue and to do it across all their communications channels and we make that messaging very clear to them to help us with that channel approach, which I'm gonna talk a little bit more about in a moment.

7:45 The the three core products that we have do cover the entire spectrum of business communications payments that occur. A term being used today is is this sort of term for conversational commerce. And we are able to cover that with the three core solutions that we have. Now the main one of those is agent assist, is the first one there you see on the left, which is secure payments for live agents. So this is a person who works in a contact center handling handling phone calls, so a live agent interacting with a customer by phone typically. And we sell this service more than more than any other. And then we have digital, which we launched in January just last year and is is is growing quickly for us, which is really an extension to agent assist and it enables secure payments for any number of digital channels as well. This is really catering for the fact that contact centers really handle the full omni channel mix now, so a single agent sitting in a contact center doesn't just answer phone calls.

8:42 They deal with interactions through web chat, through chatbots, through Twitter, through WhatsApp. However, that organization is communicating with their customers. So then we have a solution that covers the the full omnichannel mix. And then you have IVR as well, which is automated phone payments. So effectively, this is an auto attendant where there's no agent involved. So know it as press 1, press 2, these types of services. But we also have speech enabled as well for for IVR and also agent Assist. So we've got a bunch of features that tie into these core products as well and there's plenty more detail on that on our website.

9:22 Now as I've mentioned, we sell these products primarily through a channel sales model, which means we have resellers primarily and other partners through whom we obtain business. So I've got I have a slide on this in a moment, but we've got the most mature partner offering in our space. We committed to it very early in our market and we've continued to commit to it long term. As an example, and some of these companies are shown on that slide there, we're resold by over 50% of the Gartner Magic Quadrant for the CCaaS market in Western Europe and North America. So CCaaS is the term for contact center as a service, effectively cloud contact center telephony. So it's a very buoyant, fast growing market, and we've got a very strong presence there, which has been very successful to us so far and is growing.

10:17 The partner base in general continues to expand. We're very targeted about the organizations that we want to work with. And it's fair to say, actually, that most of these relationships have a lot more potential in them. Most of our partners are large organizations, a lot larger than us, certainly, and it does take time to, you know, engage with these organizations and get them moving. Sometimes signing the reseller agreement is is the easy part. It's actually engaging them, enabling them through sales, marketing, products, and then full education piece to to have them have them actually selling our services out to their customer base is the is the tricky part. In terms of the technology, so we are a cloud provider, as I've said. So we are a SaaS provider.

11:03 This is a real differentiator for us in

11:05 the market. We were the first to launch a true cloud solution available globally in our space, you know, some way ahead of other organizations in our market, and and we retained that position at the very front of our space in cloud today. To a degree, we had a first mover advantage, I suppose, and that's one of the key reasons we've been particularly successful with what we call our integrated resellers. So these are the cloud vendors in the CCaaS, UCaaS space that I was just referring to, so the likes of Vonage, 8x8, Talkdesk, who are primarily cloud organizations who do not want to work with hardware environments. So typically, they'll work cloud to cloud with any vendors that they choose to partner with. And we very much focused our product development efforts in the early days on our ease of integration with these partners and particularly the cloud to cloud light touch capabilities that we have. And we're very strong there from a partner perspective.

12:04 Now cloud's also the reason why we have the ability to service the breadth of the contact centre market. So I've talked extensively in our last update two months ago on one of these IMZ presentations about the market opportunity in contact centers in The UK and The US. And the vast majority of the market size is less than two fifty seats. So they're small to mid sized contact centers. So cloud gives us the ability to service those sorts of sized organizations cost effectively and to be able to do it at scale over time. So we have a lot of large customers too. So we have some of the largest contact centers in The UK and The US. The largest we have is certainly more than 5,000 seats in The UK, but actually we see the long term scale opportunity being the small to mid size end of the market and cloud really enables us to fulfill that.

13:02 Now, you know, we when we set out at the beginning of this journey with PCI Power, we set out to build a channel sales business selling primarily, as I've said, through reseller partners. I often say to our investors that channel selling is a big commitment for an organization to make. It's easy for anyone to get a reseller agreement signed. It's the work that goes in after that that is the key to making the business successful with a channel sales model. And and we've really invested in that and committed it to that in terms of in particularly in our sales and marketing side of our business where we we have hired people specifically for their experience in channel. And that's become a real differentiator for us in our market.

13:51 We typically see between 7080%, 85% of our contracts coming through channel partners. That's a range because it will vary from time to time. At the half year, we were at 74%. That's broadly where I'd anticipate seeing it. And that means there's still a quarter of our contracts that will come through direct, which is why we use the term partner first or channel first. And that's because we sell direct business too, and we retain the capabilities to be able to sell direct through sales and marketing structures that we have in place. The direct business that we do tends to be larger strategic deals, but we will also try to fulfill any direct business through partners if we get an opportunity to do so. We split our partners into four groups.

14:37 Now I'll focus mainly on the top two there, which are integrated partners and solution providers. These are our reseller categories. So the integrated partners, as you can imagine, where we've actually integrated to those partners' environments. And as I said earlier, typically, they're cloud vendors, so the likes of the CCaaS and UCaaS vendors where we have quite a repeatable integration model with them. So we'd integrate with them once and then they can sell that our services through that integration numerous times to their customers. And we'll typically integrate with their platforms globally if they are international organizations as well. That's actually one of the reasons why we have customers dotted all over the place even though our focus has been very much UK and US, we do get pulled into other regions, whether that be Mainland Europe, Canada or Australia.

15:25 And that's where we're seeing scale coming through as integrated partners. And then you have solution providers who are also very valuable resellers to us. They tend to be less numerous in the amount of deals that come through, but the sales themselves can be slightly larger, a bit lumpier. They're not custom as such, but they may have more custom elements to them. Have a number of very strong solution provider partners in The UK, particularly where our relationships are a little bit more mature with local partners because we've been here longer. So the likes of Civica and Capita, we've been very successful in. We're very strong in public sector in The UK. We have more than 50 local authorities using our services as well as two of the largest central government agencies as well.

16:10 Other solution providers of interest payment providers, there's a number that we work with, including the likes of Worldpay and Barclaycard. And then an interesting area for us is BPOs. So these are your large contact center outsources. Some of these organizations have many of them have tens of thousands of agents. Some of them might have hundreds of thousands of agents across the globe. You can see why they're interesting partners for us. And we did report at the half year that we've been quite successful in our targeted strategy to expand our relationships there, in particular with one or two major global U. S. Headquartered BPOs. The final two categories there are more introducer partners, so that introduces to business that we then sell direct.

16:57 And these sometimes can be where we start out a partner relationship and then we'll look to progress it to a reseller arrangement. But reseller arrangements aren't always possible and these two sectors cater for those scenarios. Okay, so I think it's important at this point to just take stock of where we've got to four years into this five year plan. It's important for reasoning for the recent fundraise. We've established a subscription based SaaS recurring revenue model and a business with very high customer retention and very low churn. So it's a very sticky SaaS business, as you might say.

17:43 Having launched in The UK effectively as an incubated start up that came out of the previous organization we were created in, in 2016, We then, just two years later, successfully launched our business into The US off the back of our first fundraise. Now that's going very well for us, but but no doubt, when we did that fundraise and we told investors that we were planning to launch in The US, that was seen as quite risky at the time given our our size and our stage, but I think that's worked out very well for us to date. And really across that time, as I said, we've established a market leading channel sales business which leverages this fantastic cloud platform that we've built and we have customers live across the globe on. So both of those things combined open up real opportunities for this business to grow further. But as I've said, whilst we talk about global, we very much have a focus and have done today for The UK and U. S, which is where all of our people resources are based today.

18:49 So I'm going to hand over to William, who is going to give a bit of a reminder of the half year and then an update on our Q3. Good afternoon, everyone. Yes. So as a finance director, the we did we have a set of key metrics that we want to follow, not only mapping out the year but into the future driven by, you know, standard SaaS based metrics. So, yeah, you want to have a business with strong revenue growth, you know, high gross margin, low churn, high contract wins, high recurring revenue, etcetera, etcetera. And we map these metrics out. And, yeah, if you look at the half year to December 20, we achieved a green headlights on all of those traffic lights for that period. So revenue grew by 56% year on year to 3,190,000.

19:43 86% of it was pure recurring revenue. Gross margins continue to improve from 67 to 73, and they will continue to improve into the future. The reason why we do have a cost of sales if we is we do have a first generation platform, which we still

20:01 use. It still generates about £1,800,000 worth of revenue, but it's a revenue share model. So we pay 50% of that out to our telco partner. Whereas the new AWS platform is all ours. We own the IP outright, and some of the deals are a 100% gross margin. And others where we do need to sometimes connect to the older type contact centers who still have PSTN type setups rather than cloud or VoIP setups. We do have a cost of sale a small cost of sales as we put telephony lines into there. But overall, we're expecting the margin to continue to grow as the Amazon platform grows to to reach 85%, 90% overall over the coming years.

20:46 TACV is a core number for us. That continues to grow strongly. As a reminder, TACV is the, the stack of all the contracts we have signed at any one particular time, whether they're actually installed or not within the business. So for instance, if we had signed a contract on the December 31 for a £100,000, we would have added that to our, our, TACV number. However, because of, the nature of our business and the accounting rules under IFRS 15, we are unlikely to start recognizing revenue on that contract for a four month, five month period while we go through the deployment because we're only allowed to start taking revenue once the contract has been materially delivered. However, I'm pleased to say that TACV continues to grow, continues to give us high revenue visibility of the next year's revenue.

21:40 This figure covers a lot of what we're seeing in FY 2022. And why is it growing? Well, we've continued to sign new annual contracts or new contracts. So we signed £1,680,000 worth. That was 100 clients, so an average annual contract value of £16,000 each. And that's that was a good strong performance on the period. More importantly, yeah, we have been a loss making company. We are we are edging towards cash breakeven. The the sustained cash break breakeven forecast was before we expand before this expansion was set at the end of this this calendar year. However, at the end of December, we had cash of 4,230,000.

22:27 And if you excluded our borrowings, we still had net cash of 2,110,000. So that's in the six month period, we had we had spent £900,000 worth of cash in spite reporting losses of $1.71800000 pounds. Why is that? Well, our business model allows us to charge, annual licenses up front where we can, and we were very successful in doing that.

22:53 Now during the fundraise, we just met yeah. We we updated the market on performance to the end of quarter three, and I'm very pleased to say that the the strong growth and strong performance has continued. So we've added another 51 new customers in the in the three month period, and those equated to another £830,000 worth of ACV, annual contract value, which is the recurring revenue elements of it. So, again, roughly £16,000 per contract. That allowed us to push our TACV up further to 8,900,000, which is a 33% increase on the from from the end of June twenty twenty. TTGL, one of our core metrics, for those who know us well, remains in line with the management expectations.

23:42 If you if you remember, it's around it takes us around four months to from signature to deploying a contract. Yeah. That's an average. Some are quicker, some are slower, but that's the that's the average, and that, remains in line with our expectations.

23:56 More importantly, cash continued to increase. So as at the end of March, we had £5,000,000 in cash in the business, so it's up £750,000. But more important, net cash had improved by a million pounds because I've been be paying back paying down some debt. So if you actually compare the 3,160,000 net cash figure you have there to the end of June, we've actually generated cash in the first nine months of the peer nine months of, trading, which was ahead of expectations. Just one word of warning, though.

24:28 The strong cash is from, not only our strong sales performance, but also renewals of existing contracts. And we do have a number of larger contracts, our larger clients renewing around the Christmas period, which we then collect in this in in this q three. But I'm expecting in q four, we will have a cash outflow and the beginning of q q one.

24:53 But we we were still on target to hit our sustainable cash breakeven as of the end of this calendar year. However, as James would explain in a minute, with the expansion, we are expected to push that out a little bit. And I'll I've seen there's a question already come in on that, so I'll answer that one later on. I'll just hand you over to James now. Thanks, William. Okay. So so, yeah, onto on onto that fundraise. So

25:21 we yeah. We we we've built a strong foundation having established our UK and US businesses, which, know, longer term, we see those being more the sort of cash cows for the organization given the size of the contact center markets in those those two countries. But we've built a built a strong base there now. We've we've a highly scalable cloud technology environment. It's proven. It's handling customers across the globe for us, high amounts of transactions going through that platform. And that platform continues to give us the opportunity for real operational gearing when it's paired up with our channel sales model as well. And then finally as well, additionally, we know that the opportunity that we have is a global one. Our value proposition is global.

26:09 PCI compliance, the problem that we solve is a global requirement. So this is a different foundation from which we're pushing on this time around. And this is a true step forward using growth capital through this fundraise. So it's a very different place for us to be to where we were previously. So we have now raised, as you're aware, pounds 5,500,000 to fund further expansion into new territories of Mainland Europe, Canada and Australia. So by doing this, we believe we're going to be growing our addressable market by more than 40%. So that's a substantial increase in growth of the addressable market. We've specifically chosen territories or countries with strong contact center markets and, I suppose, business cultural business operational similarities to The UK and The US.

27:07 They're markets that we know reasonably well already. We have availability of our services in those territories already servicing existing customers. So we already have instances of our platform in Dublin, Frankfurt, Montreal, Sydney as well as what we already have in The UK and The US. So we don't have to do that new. One of the reasons that we do have customers in these territories already is because, as I've said earlier, we have global partners. So we've had partners pulling us in these directions. And actually, as a result, in all three of those regions, in fact, numerous countries across Europe, whilst we don't have huge amounts of customers compared to The UK and The US, we do have referenceable customers. And we know from going into The US completely cold how important it is to have referenceable customers.

27:58 So we've got some great names that we can use in those regions. So for example, Queensland state government in Australia is a reference customer of ours and has been live for, you know, well over a year to eighteen months. And that carries a lot of value, particularly when a lot of the sales we're making are pretty greenfield. So it's the first time these organizations have procured these types of services. But to date, we've been very opportunistic, really. So this fundraise means we can be proactive into these territories. We can be more complete with our expansion plans. We can do it properly. And it will really allow us to stamp our ownership on this market that we're in globally, and that's been our vision since pretty much day one.

28:46 And we do look at this from a global perspective. Now in terms of how we're going to be investing the funds and the use of proceeds, there's three key areas really across sales and marketing, customer success and engineering and products. By majority, it's into sales and marketing, and that's because, you know, we have the cloud technology that means that actually the backbone is there. So we're really just layering on sales and marketing activity as needed, And we'll very much be using the strategies in sales and marketing that we've deployed successfully

29:21 in The UK and The US. I mean, it's not been perfect since day one, but we've learned a lot in that time. So, you know, we don't see we need to change it considerably, although clearly, we're gonna be adapting it for local considerations and obviously, languages is a consideration as well. But but we're well on the road to to what we need to do there. And then additionally, to continue to achieve low churn and driving, ideally, positive net retention, which is what we achieved today, ever so slightly above 100% net retention, we're going to be strengthening our customer success functions across, in the first instance, North America and EMEA. So churn and retention are key metrics for a SaaS business. They're metrics that we're going to start talking to investors a bit more about as well. So we intend to hopefully start doing that from the beginning of the next financial year. So you can use those in your assessments of us and how we're performing.

30:18 While we're adding ACV, as William has just described, the sales going in the top, we need to make sure we're not losing out at the bottom. So we need to make sure that we can sustain the sorts of rates we've got today. So we're going to be investing there. And then finally, we will, to a lesser degree, in terms of the amount of investment, we will continue to strengthen our product engineering capabilities to ensure that we are the best option for our partners and our customers and that we evolve our product set over time to meet demand. We really want to be on our toes in this respect. So it's not just being we certainly don't want to be reactionary. We want to spot trends before they become reality, particularly from a product perspective. So all in all, the main spend is people related in those areas plus some marketing.

31:07 We're looking at around 25 to 30 people over the next two years, making up that additional spend. And as a result of that additional investment, as William just said and as shown in FinCap's latest research note, we'll be pushing out our first months of breakeven from the back end of this calendar year by about twelve to eighteen months. But this will further fuel the long term rates of revenue growth that I've been talking about as we've been going through this presentation. So just to round up before we get to questions. We feel like we've got fantastic momentum with this business, and we want to keep that going. We could have sat it out and worked towards our first months of profit within the next six months. We can clearly see how we get to that point. And as you can see, the cash burn has really dropped off. In fact, we've generated cash in the last quarter, as William has just said. But in terms of delivering value for our shareholders, which is what we're here to do, when we look out over the next three, four, five years, we believe that it's the right thing to push harder now and expand the opportunity that we have in front of us to bring more benefits in the long term, which in turn will push back the value to our shareholders. So we're looking at maximizing this potential.

32:25 And from a sort of numbers perspective, as a minimum, we're looking at two years out, three, four, five years, minimum of 30% to 40% revenue growth to be sustained longer term into the future. Okay. So thanks for listening. Yes, we can definitely run through some questions now. We've got plenty of time to do that. Yes. Thank you, James. Thank you, William. Now if we return to the questions, we have a number of questions that were submitted ahead of the presentation. However, please do continue to submit your questions using the q and a tab situated on the top right hand corner of your screen. I'd just like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor meet company dashboard.

33:12 Additionally, your feedback is important to the company. So immediately after the presentation has ended, you will be redirected for the opportunity to provide feedback. While you're submitting questions, let us first have a look at those submitted ahead of the event. Now there there's one actually which was ahead and one which we've had submitted since. So I'm actually just gonna combine the two, if that's okay. Firstly, what plans does the company have to strengthen the management, both commercially and technically, to cope with all the new and diverse markets? And if you could combine that with the second question, which you did touch on actually, how do you see the company growing in terms of numbers of employees and regional offices? Yeah. Okay. I'll take that one. So in terms of the strength of management that we have, we've gone from 10 people to 75 in the last four years, roughly.

34:03 We've we've been very strategic, very particular about the people that we've hired. We have had the same vision statement for most of that time. So we've always been working towards this global market leadership position. So as such, we've been, you know, tactically hiring the right people into our management team across that time, certainly for the last three to four years. I I probably encourage you to go to our website and have a look at the I think it's the why us and our people section. Take a look at the management team that report into myself and William. You can look at their LinkedIn profiles, and you'll see that you've got some serious breadth of experience, very relevant to our our market as well, and also a lot of global experience in there as well. So I think we're pretty well set up, and and we have what made one on one or two additional management hires in in the last twelve months plus. Now we we also, in that time, have strengthened our board. So we had a new chairman come into place within the last eighteen months.

35:07 And Simon's got significant international software experience. He's also US based, although he's a a British citizen as well. So that's been beneficial for the business too in terms of fulfilling these long term ambitions that we've got. And some of you will be aware that in September just gone, we also formed the company's advisory committee. Now we only have one member on the advisory committee at the moment, a lady by the name of Nira Jones, who was a senior executive at Barclays Card, Santander. But that brings a wealth of experience from a payments perspective as well. And we've been very open about the fact that we do intend to grow our advisory committee. We see it as a low cost way for us to gain additional perspectives to myself and the board.

35:54 So we're going to keep doing that in line with the sorts of aspirations that we've got. But people are totally critical to this business. It's the you know, William would always tell you it's the majority of his costs going out the p and l. It's people related. But as with everything, we're looking at continuous improvement and whether that be developing existing people that we've got or hiring new skill sets and experience. We're always gonna be looking looking at it and, you know, that talent piece firmly firmly sits with me. So it's something I'm, you know, personally quite passionate about. The other question related to the amount of people and timing. Tom, can you just remind me? Have follow-up question. How do you see the company growing in terms of numbers of employees and regional offices? You did touch on the employee number. Yeah. Yes. The employee number over the next two years is something like 25 to to to 30 people. In terms of regional offices, we're very light on this anyway.

36:48 So so hence, I didn't really mention it. But we we have our head office in The UK is in Ipswich. We also have a small London office, which like everybody, we downsized. That's just in a WeWork location. Our US head office is in Charlotte, North Carolina, which is also in a WeWork location, and we intend to leverage WeWork for probably three additional offices in those three territories. But you're talking, you know, minimal spend to be able to do that. So we could set that up overnight if we wanted to. There was another question in around how long would it take us to get the territory set up. Well, we can actually move very quickly. So we already have the company incorporated in Australia and we have the ability to operate in Mainland Europe under The UK and also Canada under The US today. So it's really about the timing that's going to suit us operationally rather than any other blockers that might prevent us from moving any quicker.

37:51 Great. Okay. Quick one here. Now you have funding and shareholder support. What do you see as your biggest risk in the second half of twenty twenty one? Well, given given what we're about to embark on, it'll be it'll be the timing of that and getting the momentum moving with that. I you know, that that's probably the biggest risk based on this plan is that we get everything moving quick enough. That would probably be the the the risk that I would consider the one that could be most impactful if if we didn't respond to it in the way that we'd planned. But as I said, I think it's a minimal risk.

38:37 We are dealing with a lot of other aspects of the business right now that I maybe would have answered or offered up as an answer to that question previously. So we're very strong on the customer success side, and we're strengthening that now. The partner piece, we're not particularly dependent on individual customers. So I'd say it's really making sure we take this next step up and we do it in time with what we've assumed in our plans. But as I say, don't think there's too much in the way of us being able to do that. Great. Okay. Couple for you, William. The first one, you've done well to this point. When do you now expect the first months of sustained cash generation? There was a touch on that in in James' previous answer, but maybe you could just reiterate that point. Yes.

39:23 So, yeah, we've we've clearly been, yeah, on the cusp of cash breakeven through our business model currently. With the new expense expansion coming out, as James said, we're going to push the the profit breakeven point out twelve to eighteen months. However, with our business model and us invoicing in advance on licenses, it's normal that our cash generation will run, circa three months ahead of that. So you're looking at a a nine to fifteen month period before we hit cash breakeven under the new plan if all is if all goes to plan. Great. Okay. And one just in terms of the revenue patterns. Is there a seasonality to sales by quarter? And if so, what drives that?

40:13 Well, if I just cover off the ACV point. So, yeah, there there's a bit of seasonality. I wouldn't you know, there there's a the The US the the the quarter that runs up to Christmas is naturally a busy one for technology in The US, but I think we have not experienced strong trends so much in that, certainly not across this financial year so far. But certainly, in the past, it's probably more what you were gonna say, William, is that we we do have a smaller number of quite large customers. I mean, proportionate to our revenues, it's you know, they're they're not big numbers percentage wise now, but we for some reason, we have tended to sign those between sort of November and February time. So those renewals do impact cash, and they do impact recurring revenues as well.

41:06 I was just gonna add also that the pandemic has aided our business model over the last twelve months. People have realized that they need to be more cloud based. That's benefiting our partners, in the C Gas providers, and that has opened up other opportunities to to us, which has taken some of the seasonality out over the last twelve months because there's there's a constant demand for the for the products, which is which is good from our point of view. Right. Okay. Maybe we can just ask this question, which I know is is a hot topic for private investors in in many scenarios, but you chose not to include private investors in the fundraise. Why were we excluded? Check them on mute. Okay. Yeah. I mean, look. Since since I took over in the role of of CEO, it's been a particular strategy of ours to increase the amount of information sharing with with our private shareholders. You know, we've really tried to to step that up. That's why we use platforms like like IMC to do that so that we can be clear about our objectives and our goals, and and it's not just, you know, institutional investors that get to have have that access.

42:20 We we considered the whole open offer topic as part of the considerations we made around the strategy and the structure of the fundraise, both as a board. We did that with our advisers as well. But we made various considerations around it. We at the time, we wanna move quickly that, you know, we wanted to capitalize on the positive sentiment in the market at the time. And adding an open offer is adds a layer of complexity, which means it adds time as well. It also adds cost too. So the cost could be north of £75,000 to go through that process when, you know, gauging what the demand might be versus the cost. We had to weigh that up in amongst everything else. So, you know, if there had been a delay, for instance, as a result of doing the open offer, then we we were very sensitive at the time to the screen price, and we knew that with the raise that that we went through that we needed to get as close to that screen price as possible, if not that screen price. You know, we had something that we were aiming for because we didn't want, you know, the the price to to erode the value of those existing holders. So all these things kind of combined, and we did ensure that the price wasn't heavily discounted.

43:39 It was less than 10%. And we're in a really good position now to capitalize on the long term opportunity that we've got, which we think will really deliver value to our shareholders, all shareholders. And all of those shareholders have also benefited from the improvements and the execution that we've made over the last year. So we'll always consider all these options, and we'll discuss these things at length as a Board, and we'll make the decision based on what we think will work long term in terms of returns for shareholders. But we feel that we made the right decision at this time, and we did review it. I can tell you we reviewed it extensively and not just once either.

44:27 Yeah. Great. Okay. Well, thanks, James. A couple more that have just come in. You have a number of public sector customers. Can you explain why this is, and can we expect this trend to continue? So there's a that was a specific strategy in The UK. We started on that path quite some time ago. We knew it would be a slow burn. We particularly went out to win potential partners that would help us secure business in the public sector. We see public sector as a fairly reliable revenue source long term if we can get in and be well established. So we do sell direct into it. We have some large central government agencies that we've sold direct to, but we have a lot of customers through our partners, Civica and Capita, that we've built up over time.

45:14 Now we have been proactive in The US as well, I might add. So we did announce at the half year that we'd signed one of the largest IT service providers to government, Fed and SLED in The US in the period. And we also signed our first US state who actually went live two or three months ago. So we now have a state live in The U. S. Now it's a very slow burn, but we do hope to use some of what we've learned in The UK to explore more in The U. S. So yes, I'd say expect this trend to continue. We've got 45, 50 local authorities in The UK. I believe there are several 100, so there's plenty more for us to go at. And certainly, we see the value in government in other territories that we operate in. But all I will warn is they are slow.

46:05 And in all in every area of them, selling to them, delivering their projects, you know, all all of those things. Great. Okay. Just a quick one on the committee. And can you talk about how the development of the company in terms of its products, customers, and routes to market might change with the establishment of the advisory committee and the appointment of Nira Jones? Okay. So we're not planning any major changes anytime soon. But what we are making sure of is that given the investment we've made into our technology, into this business, into our positioning that we are now in, Now if we sit at this intersection between business communications providers, organizations and consumers that we're keen to look for opportunity and add value to what we do.

46:55 So we're ensuring that as a business that historically has been more expert, I suppose, in security and communications that given we touch several other areas, so payments being one of those, we're making sure that we've got some advisory expertise that can perhaps give us another angle on things. So we're exploring all angles all the time as to how we strategically can deliver value and give ourselves more opportunities in the future. But we're not going to forget our knitting, no way. We'll do that very carefully and cautiously. But it was pretty clear when we announced the advisory committee that we were raising our eyes to look perhaps just outside our core, but we're not planning any major changes anytime soon. But as a minimum, it allows us to understand our own relevance to our space from the perspective of the payments market in having having near onboard. But as I say, there should be we do expect to add more to the advisory committee in the coming two years.

48:01 Great. Great. So alright. Well, look. Last question before we close out, which might be a short one. Would you consider listing in The US at the right point in time? That's not something that we're considering at the moment. But as we stated in our fundraise, we we do have investors from North America now. Hence, we're doing this at 05:00 UK time. That's to try to cater for some other time zones that we know are following us right now. So it's not something being considered right now, but to say we do have interest in that region. So we're we're we're we're naturally having having conversations with existing investors just as we do with our investors in The UK. Great. Okay. Super. Well, that that's a nice close. Thank you both. Can I ask investors not to close this session as you will now be automatically redirected for the opportunity to provide your feedback?

48:52 If you access this meeting from our website, the feedback page will appear. If you access from the link sent to you by email, you will be asked to log in to submit your feedback. If anyone has any further questions or would like additional information on PCI PAL, please do get in contact via pcipal@walbrookpr.com. Alternatively, many thanks for attending today's presentation. We will update you again soon. Yep. Thank you. Thanks, everyone. Everybody.