Direct Insite Investor Presentation 2013
Upcoming SlideShare
Loading in...5
×
 

Direct Insite Investor Presentation 2013

on

  • 517 views

 

Statistics

Views

Total Views
517
Slideshare-icon Views on SlideShare
382
Embed Views
135

Actions

Likes
0
Downloads
1
Comments
0

1 Embed 135

http://www.companyspotlight.com 135

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Direct Insite Investor Presentation 2013 Direct Insite Investor Presentation 2013 Presentation Transcript

    • Direct Insite Corp. (DIRI) Investor Presentation – September 2013
    • Safe Harbor Statement Some of the statements made in these materials may be forward-looking in nature. If you want to understand the risks associated with such statements, please review our filings with the SEC. All material contained in this presentation is the sole property and copyright of Direct Insite Corp. with all rights reserved. Certain statements, which are not historical fact, may be considered forward-looking statements that involve risks and uncertainties. Forward-looking statements include statements regarding future business results; future sales and profitability; customer demand; and industry and economic conditions. Various factors could cause actual results to differ materially from what is set forth in such forward-looking statements. These factors are set forth in our SEC filings. All are cautioned not to place undue reliance on these forward-looking statements as the Company does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect future events or circumstances, or to reflect the occurrence of unanticipated events. 2
    • Company Background and Highlights • SaaS model leader in financial supply chain AP and AR automation tools • Blue-chip customer base: IBM, HP, Siemens, St. Gobain, Citibank, Shell Oil, Hyatt. • Global vendor network of 300,000+ suppliers • Corporate restructuring in May 2011 – reconstituted Board and new management • Since restructuring, announced 11 new customer wins and moved from revenue declines to double digit revenue growth • Cash flow positive with net balance sheet cash of $1.5M and $27M in legacy NOLs • 60+% insider ownership • TTM revenues of $9.3M • Robust M&A environment valuing private peers at up to 5.1x TTM revenues (average is 3.3x) • Industry tailwinds favor move to transformation & automation • Continued growth opportunity with addition of new customers, new products, network monetization, and selective acquisitions 3
    • Significant Global Vendor Network Direct Insite Corporation Copyright 2009 Confidential & Proprietary 4 Direct Insite Supplier Network: 350,000+ Suppliers Transacting over $127 Billion Annually 4
    • Opportunity – Customer Benefit • Direct Insite provides cloud-based, ERP agnostic solutions that automate AP and AR invoice processes for Fortune 3000 companies. • Customers reduce costs, cycle time, and improve vendor/supplier/customer satisfaction. • Customers can eliminate call center inquiries on invoices and reduce human “touches”. • Customers can increase/decrease DSO’s by using a technology solution in coordination with a financing partner. 5 Source: Gartner AR Study Invoices On-Line™ Accounts Payable and Accounts Receivable Automation
    • Opportunity – The Market • In the Fortune 3000, only 40% have implemented automation tools. • Even those large companies with automation suffer from multiple legacy ERP systems with inconsistent automation capabilities requiring rework. Direct Insite estimates market is only 10% penetrated. • 90% of global companies manually enter invoice data and pay invoices with $30 trillion of paper checks. • Global regulation, anti-money laundering, and tax requirements accelerating move to electronic record keeping. • Technology’s use in supply chain financing in its infancy. 6 Conclusion: Automation will happen, not an “if”. The land grab has begun.
    • Primary Offering, Model, and Service 7 Invoices On- Line™ AP and AR Automation Invoice/PO Workflow Processing Payment Processing with Financial Partners Dynamic Discounting Scan/Capture Business Model Highlights • Cloud-based SaaS business model o No hardware or software capital expense o No IT resource burden • Integration with any ERP or legacy system • Ability to accept any invoice, in any format, from any source • Manage boarding process and supplier migration from paper to electronic • Transaction-based pricing Customer Profile • Invoice volume >10K per month • North American or global operations • Fortune 3000 with large shared-service centers • Multiple legacy financial/ERP systems • Inability to capture payment discounts • Payment card industry compliance issues • Initiatives underway to eliminate paper, streamline costs, improve customer/supplier processes Direct Insite Automates Financial Supply Chain Management
    • Product Roadmap 8 Invoices On- Line™ Core Data Processing Services Network Value and Monetization Invoice/PO Workflow Processing Payment Processing with Financial Partners Dynamic Discounting Scan/Capture Supply Chain Financing Regulatory/Compliance Monitoring Business Intelligence Current offerings Company Profile Management Network Participation with Partners Spend Management New Products Automate Compliance, Financing, and Intelligence
    • Business Goals  Automate AP invoice processing  Reduce inquiries from suppliers  Improve relationships with suppliers  Save money Business Results  Reduced Costs – Reduced average cost to process an invoice by 24%  Improved Staff Efficiency – Receives 73% of its invoices electronically and posts payments for 63% of its invoices without operator intervention  Increased Productivity – Reduced work flow time from a more than four days to less than 12 hours for electronic invoices and less than 2.5 days for paper invoices  Enhanced supplier relationships – Reduced supplier inquiries by 67% “Invoices On-Line has proven to be an effective tool in the transformation of our Accounts Payable automation initiatives with a goal of reducing paper handling, invoicing costs and supplier inquiries.” Roderick Fields, GSS NA Director of Disbursement Services Customer Profile: • Shared services environment for the global powerhouse • Supports more than 50 Siemens business units • Processes over 2.4 million invoices per year • 60,000 suppliers • 5,000 internal users Siemens Global Shared Services Case Study 9
    • Business Goals  Automate AR processing.  Enhance customer service.  Improve overall invoice processing efficiency.  Reduce Day’s Sales Outstanding (DSO). Business Results  Reduced Costs – Reduced paper invoices by 75%, slashing the cost per invoice on these items from between $600 - $1,500 per invoice to less than $25 per invoice  Improved Staff Efficiency – Reduced invoice disputes by 65 percent  Reduced DSO – Reduced DSO by approximately four days, resulting in a $50 million increase in treasury cash available and $4 million in annual savings in interest expense on these DSO funds  Enhanced supplier relationships – Customer satisfaction with IBM’s invoicing process jumped from 27% to 72% within six months of implementation Customer Profile: • 100 year-old company with approx. $100 billion in revenues • Generates millions of invoices each year across over 100 countries and 15 languages • Selected Direct Insite’s IOL platform to provide: Web-based line item presentment; dispute management; attachments IBM Case Study 10
    • Customer Wins and Implementations 11 Announcement Customer Description Implemented Current Revenue* July 2011 Multinational manufacturer of lighting products Yes Yes August 2011 Chain of auto supply stores Yes Yes August 2011 Global building products manufacturer Yes Yes October 2011 Multinational IT services provider Yes Yes November 2011 Global branded grocery products manufacturer Yes Yes May 2012 Global hospitality corporation In process No September 2012 Manufacturer of aviation components In process No September 2012 Human resources consulting firm In process No December 2012 Supermarket chain In process No January 2013 Debt settlement organization Yes Yes April 2013 Tier 1 global bank In process No * Customers currently contributing revenue as of July 2013, most may not be at full run rate.
    • Financial Highlights 12 7.8 8.0 8.2 8.4 8.6 8.8 9.0 9.2 9.4 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 TTM Revenues ($M) Note: FY 2011 and Q1 2012 revenues exclude pass through 3rd party scanning revenues from a client that ceased scanning services in January 2012. 0.4 0.6 0.8 1.0 1.2 1.4 1.6 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Cash Balance ($M) Customer Wins Providing Current Growth Growing Cash Balance for Future Flexibility
    • Adoption & Key Metrics 13 4 4.5 5 5.5 6 6.5 7 7.5 2011* 2012* Q1 13 Q2 13 Invoices Processed (millions) 0 50 100 150 200 250 300 350 400 2011 2012 Q2 2013 Vendors on AP Network (thousands) * 2011 and 2012 Invoices Processed are quarterly averages Over 350,000 vendors… Processed over 7.2mm invoices in Q2 2013
    • Company Strengths and Obstacles 14 Strengths • Recurring revenue business model • Robust and growing sales pipeline • Transparent, shareholder friendly management • Big spending from venture-backed startups to evangelize the market • New products coming & functional extensions to existing product suite • Robust and growing vendor network and plan to monetize • Automation is a given, financial supply chain will be automated Obstacles • Lengthy sales cycle of up to two years • Post contract execution, lengthy implementation timeline of up to a year+ • Venture backed startups creating noise and inflating expectations of potential sellers • Monetizing the network without endangering core franchise
    • Growth Objectives and Timeline 15 2012 • Invest in direct sales force, channel, and building a sales culture • Standardize product offerings to facilitate future new product introductions and cost efficiencies • Add new customers and drive usage amongst existing base 2013-2014 • Develop and introduce new products to sell to new and existing base • Identify, target, and become part of toolkit for additional channel partners • Identify new markets and applications for the company’s technology (debt settlement) 2015 • Create value from the “network effect” in valuable supplier network such as supply chain financing and compliance management • Explore opportunistic acquisitions to expand vendor supplier network Revenue Growth Target 10%+ Achieved 10%+ 10%+ Company goal is to reach and exceed 30% top line growth by 2015.
    • Conclusion Why invest in DIRI now? • Aggressive, focused management team that is revenue goal-oriented and shareholder friendly • Marketing, lead generation, and sales team producing largest pool of new customer opportunities in company history • Trading a lower multiple to peers, but with stronger core customers and offerings • As tax and additional regulation move into the US (starting with healthcare), incumbency is critical for long term and significant growth • Industry is fragmented and will continue to consolidate, own a benchmark company in the space today with upside tomorrow • No debt with accumulating cash • Opportunity to enter into the space with public company visibility, Fortune 3000 customer list, and a growing Global Vendor Network with several revenue opportunities growing out of the core business! 16
    • Matthew Oakes President & CEO matthew.oakes@directinsite.com 631-873-2932 www.directinsite.com Contact Information
    • Supply Chain Finance Automation M&A 18 Larger networks are consolidating invoices, customers, and supplier networks. Date Acquirer Target Revenues (in M) Price or EV (in M) EV/Revenues 2010 Ariba Quadrem 65 150.0 2.3 2011 Ariba b-Process 11 35.0 3.2 2012 Basware CertiPost 8.4 18.2 2.2 2012 Basware First BusinessPost 2.4 12.2 5.1 2011 Bottomline Technologies Logical Progression/IDT 1 2.9 2.9 2011 Bottomline Technologies DDL 3.5 10.9 3.1 2013 Readsoft Expert Systems 13 40.0 3.1 M&A Average 14.9 38.5 3.3 6/30/2013 Direct Insite 9.3 20.6* 2.2 * Closing price as of 8/14/13 Note: excludes venture financings at similar or higher multiples