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August 15, 2016
Research #1
Tactical Technology
A money-printing technology
Rockstone wouldn’t wander from mining into the...
2
arketing experts know
all to well that the best
recommendation for a
product is happy customers doing
word of mouth mark...
3
The main difference to the old business
model is that from now on continuously
recurringrevenuesarepursued,whereas
the f...
RAMPartners SA
Bvd Georges-Favon 19, 1204 Geneva, Switzerland
Email: info@rampartners.ch
Analyst Email: ey@rampartners.ch
...
RAMPartners SA
Bvd Georges-Favon 19, 1204 Geneva, Switzerland
Email: info@rampartners.ch
Analyst Email: ey@rampartners.ch
...
RAMPartners SA
Bvd Georges-Favon 19, 1204 Geneva, Switzerland
Email: info@rampartners.ch
Analyst Email: ey@rampartners.ch
...
RAMPartners SA
Bvd Georges-Favon 19, 1204 Geneva, Switzerland
Email: info@rampartners.ch
Analyst Email: ey@rampartners.ch
...
RAMPartners SA
Bvd Georges-Favon 19, 1204 Geneva, Switzerland
Email: info@rampartners.ch
Analyst Email: ey@rampartners.ch
...
RAMPartners SA
Bvd Georges-Favon 19, 1204 Geneva, Switzerland
Email: info@rampartners.ch
Analyst Email: ey@rampartners.ch
...
RewardStream Investment Opportunity
RewardStream specializes in the tactical execution of referral marketing programs that...
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REW:TSX Venture Exchange
Referral Marketing Industry
A recent survey by RewardStream s...
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REW:TSX Venture Exchange
Why Referral Marketing - Trust
With a small cost to the marke...
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REW:TSX Venture Exchange
Perhaps the best part of the referral process is that it can ...
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REW:TSX Venture Exchange
2. How many people do I need actually making referrals (custo...
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REW:TSX Venture Exchange
However if one of the existing customers, already happy with ...
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REW:TSX Venture Exchange
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REW:TSX Venture Exchange
RewardStream & Telecom Companies
One of the biggest challenge...
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REW:TSX Venture Exchange
RewardStream’s Growth Engine will mainly be from E-Commerce
S...
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REW:TSX Venture Exchange
Share Price as of August 8th
, 2016: $0.38
Market Capitalizat...
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REW:TSX Venture Exchange
- that processed millions of transactions per month, totallin...
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REW:TSX Venture Exchange
Appendix: Demand Metric Benchmark Report (June 2016) Key Figu...
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REW:TSX Venture Exchange
DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the
views of e...
24
Disclaimer and Information on
Forward Looking Statements:
All statements in this report, other than state-
ments of his...
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RewardStream: A money-printing technology

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Rockstone wouldn’t wander from mining into the tech space, unless there is an outright opportunity based on a proven and second-to-none money making growth model, one that just started to trade publicly but is already poised to take off immediately. As a matter of fact, Vancouver-based RewardStream Solutions Inc. (TSX.V: REW) is on track to bank revenues of $1.75 million CAD in fiscal 2016, which ends in September. Is this the end of the line or just a foot in the door?

Well, if you have custumers that evidentially make money in multiples of your invoice to them, you have pretty happy customers. And happy customers get addicted to you, while others take notice and want the same – the main ingredients for a viral buzz, as based on a pull rather than push strategy. There’s nothing more powerful than word of mouth. If you have a technology that can convert this power into cash, you not only hit a jackpot but own a pilfer-proof goose perpetually laying golden eggs. If you spend 1 buck a day on keeping your goose alive and she returns a daily yield of 1 gold(plated) egg worth $86, you should consider cloning (and if feasible get publicly listed). Basically, that’s what RewardStream does (and did 7 days ago when it started trading on the TSX.V under the symbol REW): The company has produced $300 million CAD in new business for its customers in the last 24 months (now you do the math).

The kind of companies, recurrently streaming this much business from newly generated customers, have chatoyant names like Envision, Bell, Bark, Sprint, Telus, or Rogers – and literally have what it takes to spread the word. Alone Boost Mobile adds over 20,000 new customers via RewardStream’s technology each month. Everybody wants to get rewarded.



Loyal shareholders of RewardStream are sure to have catched a high-profile tech company with a proven track-record and blue-sky growth potential; in order to be made happy, too, as that’s what the company does. Last Friday, Geneva-based analyst Erenik Yzeiraj from asset managing RAMPartners S.A. initiated coverage on RewardStream, targeting a price of $1.93 CAD per share by next year. Last recorded price was $0.42 CAD. The word is getting out now. Get rewarded, too.

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RewardStream: A money-printing technology

  1. 1. August 15, 2016 Research #1 Tactical Technology A money-printing technology Rockstone wouldn’t wander from mining into the tech space, unless there is an outright opportunity based on a proven and second-to-none money making growth model, one that just started to trade publicly but is already poised to take off immediately. As a matter of fact, Vancouver-based RewardStream Solutions Inc. is on track to bank revenues of $1.75 million CAD in fiscal 2016, which ends in September. Is this the end of the line or just a foot in the door? Well, if you have custumers that evidentially make money in multiples of your invoice to them, you have pretty happy customers. And happy customers get addicted to you, while others take notice and want the same – the main ingredients for a viral buzz, as based on a pull rather than push strategy. There’s nothing more powerful than word of mouth. If you have a technology that can convert this power into cash, you not only hit a jackpot but own a pilfer-proof goose perpetually laying golden eggs. If you spend 1 buck a day on keeping your goose alive and she returns a daily yield of 1 gold(plated) egg worth $86, you should consider cloning (and if feasible get publicly listed). Basically, that’s what RewardStream does (and did 7 days ago when it started trading on the TSX.V under the symbol REW): The company has produced $300 million CAD in new business for its customers in the last 24 months (now you do the math). The kind of companies, recurrently streaming this much business from newly generated customers, have chatoyant names like Envision, Bell, Bark, Sprint, Telus, or Rogers – and literally have what it takes to spread the word. Alone Boost Mobile adds over 20,000 new customers via RewardStream’s technology each month. Everybody wants to get rewarded. Loyal shareholders of RewardStream are sure to have catched a high-profile tech company with a proven track-record and blue-sky growth potential; in order to be made happy, too, as that’s what the company does. Last Friday, Geneva- based analyst Erenik Yzeiraj from asset managing RAMPartners S.A. initiated coverage on RewardStream, targeting a price of $1.93 CAD per share by next year. Last recorded price was $0.42 CAD. The word is getting out now. Get rewarded, too. Company Details RewardStream Solutions Inc. Office 250 - 2985 Virtual Way Vancouver, B.C. V5M 4X7 Canada Phone: +1 877 692 0040 Email: dean@rewardstream.com www.rewardstream.com Shares Issued & Outstanding: 37,787,115 Free Float: 4,448,603 (12%) Canadian Symbol (TSX.V): REW Current Price: $0.42 CAD (August 12, 2016) Market Capitalization: $16 million CAD German Symbol / WKN: JL4L / A2APX1 Current Price: €0.22 EUR (August 12, 2016) Market Capitalization: €8 million EUR Chart Canada (TSX.V) Chart Germany (Frankfurt)
  2. 2. 2 arketing experts know all to well that the best recommendation for a product is happy customers doing word of mouth marketing. Conventional advertising congests the channels, is increasingly perceived as annoying and tends to lose effectiveness. Numbers confirm that consumers used to digest some 500 advertisements per day in the 1970s – nowadays it’s more than 5,000 ads a day, still with an increasing tendency. Even a giant like Facebook cannot with- draw from this trend of advertisement dilution: The opening rates of product specific company news stood at a terrific 30-40% during the first years – by now, these have dropped to only 4%. Accord- ingly, the company’s euphoria has been brought back to earth. The Vancouver-based software company RewardStream, which has raised $2.1 million CAD from investors a few days ago when going public on August 8, is finally offering a solution for marketing people. Clients not only from the telecom- munications sector are already book- ing phenomenal results thanks to the automated referral marketing technol- ogy from RewardStream; and include Johnson&Johnson, RBC Royal Bank, First West Financial Services, BC Hydro, AT&T, Telus, Boost Mobile, Koodo Mobile, or Cricket Wireless amongst many others. Ajaw-dropping900qualifiedbusinesses from the telecommunications and financial services sectors are currently in the company’s pipeline. A highly increased newsflow can be expected. RewardStream anticipates further growth especially with the integration of its app in very large eCommerce platforms like Magento or WooCommerce. Such integration will enable the access to thousands of websites, which cannot afford expensive marketing programs on its own, not to speak of developing own systems and learn about effective tactics over time. RewardStream is taking advantage of consumers which react less to “brand- ed advertising“. On the other hand, the direct referral from a friend – aka word of mouth – works highly effective. Re- wardStream has successfully managed to translate this principle into a software architecture and offers the simple inte- gration of its app, enabling consumers to communicate directly to each other. Experience has shown that the opening rates of referral email campaigns stand at a record-breaking 80% (in contrast to 14% from conventional marketing emails). About half of all receivers are actually getting active, again an exceptionally high number. The incentive for the recommending person is lucrative: As the software is capable of directly assigning a generated lead, the person sending its recommendation will profit instantaneously in case its referral results in new business. Depending on the company and the sector, this can be a discount on the phone bill or a monetary present. Each marketing department can decide by itself. From a company’s perspective, including its shareholders, success is what counts the most, followed by an easy handling and efficiency to produce revenue. The entire referral process, including feedback loops and reminders, is completely automated and easily integrable into own individual designs. RewardStream has developed a revenue model which provides the marketing clients a low-threshold flat rate of $2,000 USD for example. Only if this level is exceeded, success fees are due for each successfully placed new customer. It’s especially attractive that the quality of the customers, which are won with direct referrals, can be classified as high, because experience has proven that loyal customers tend to recommend others that have a similar profile. However the strongest argument is the cost per newly generated customer. North America’s telecommunications sector typically incurs costs of $140 USD or more for each new customer. Reward- Stream is capable to reduce these costs to $50 USD and less. RewardStream is not a typical start- up company. The company actually existed as a private provider as early as 1999 and was financed through private equity. In the beginning however, the business model was focused on loyalty programs for companies. Not until a new management team took over the company about 2 years ago, the focus has been put on referral marketing. One can say that the company has re- invented itself, yet it was able to build on its intimate knowledge of customer needs, and on a greatly enhanced state- of-the-art software architecture. M Research #1 | RewardStream Solutions Inc.
  3. 3. 3 The main difference to the old business model is that from now on continuously recurringrevenuesarepursued,whereas the former loyalty business was more of a campaign-driven business. Typical for the business, the margins for the “Software as a Service“ (SaaS) business stand at 60%. For the first fiscal year, which end in September 2016, RewardStream expects a revenue of an estimated $1.75 million CAD. This significant number includes already some 80% of recurring revenues. About 70% of the revenues originate from business in the USA, the biggest growth market for RewardStream. Until 2020, the company wants to generate revenues exceeding $30 million CAD, with margins that are expected to be as high as 80%. The industry multiples currently stand at 6x and as such, a market value between $150-200 million CAD appears plausible. Applause to the share structure of the company; as it has been designed that management will own 50% of the com- pany after going public – not immedi- ately but over a period of 3 years. This represents an enormous incentive to reach, or even exceed, its corporate goals; not to speak of providing invest- ors a very low float vehicle to participate (4.5 million unrestricted shares), poten- tially without many capital raises in the future). Investors who buy RewardStream pri- marily bet on its management, which also participated in the financing. CEO Rob Goehring impresses with year-long experience as a “serial entrepreneur“. He was the Chief Marketing Officer at the public company Tio Networks Corp. (TSX.V: TNC; market capitalization: $205 million CAD), and a co-founder of Con- tigo Systems Inc., a private company successfully sold to Vecima Networks Inc. (TSX: VCM; market capitalization: $230 million CAD). So far, Goehring has raised some $20 million CAD in venture capital. His goal for RewardStream is straight-forward: “Wecompetedirectlyagainstthenoisein advertising and want to offer our clients a way to deliver optimal satisfaction.“ Goehring does not shy away comparing with other powerful competitors. He be- lieves that RewardStream’s technology can not only compete with US compan- ies like Marketo Inc. (NASDAQ: MKTO; market capitalization: $1.6 billion USD) or Hubspot Inc. (NYSE: HUBS; market capitalization: $1.9 billion USD), but will gain market shares directly from them. It will be interesting to follow at what valuations RewardStream’s manage- ment may get pushed into an exit, in case RewardStream can continue to grow strongly. The team is complemented by a num- ber of high-profile industry experts with impressive experience in the fields of marketing (Neil Parker), Operations & IT (Devin Redlich, MBA), VP Finance (Charles Abel, CPA, MBA), Software Technology (Kevin Cambell, BSCE) and Sales (Buzz Hemphill). The average age of management is in the mid-thirties; for everyone it’s at least the second or third company for which they work. Hungry young guns. Bottom-line: RewardStream offers a second-to-none opportunity to participate, from scratch on, in a strongly growing segment of online marketing. In stark contrast to most other start- ups, the business model is already fully established, running efficiently, and generating solid and recurring revenues with formidable chances of additional growth thanks to additional channels to be integrated to shortly, besides happy customers. I have personally met management in Vancouver and I am confident that they can exceed the conservative business plan by heaps and bounds. Investors should follow closely a potentially very strong newsflow going forward, which in turn will help to spread the word and may advance it as one of the most respected stocks in the junior tech space, primarily thanks to happy shareholders. Research #1 | RewardStream Solutions Inc. Click on above image (or here) to watch a short video on RewardStream Source: RAMPartners S.A., Switzerland
  4. 4. RAMPartners SA Bvd Georges-Favon 19, 1204 Geneva, Switzerland Email: info@rampartners.ch Analyst Email: ey@rampartners.ch Telephone: +41223108602 RewardStream Solutions Inc. Author: Erenik Yzeiraj, Analyst 10.08.2016 August 2016 INVESTMENT HIGHLIGHTS Stellar Management Team: highly successful entrepreneurial and corporate level experience combined in one team Referral Marketing: most trusted, most efficient, and less expensive marketing program – cuts through the noise and overwhelm Profitable Business Model (flexible cost structure with scalable revenues) and High Value Proposition (complete solution tackling a real need in the market) Market penetrated (with reputable corporate customer base) and on track to grow exponentially THE INVESTMENT OPPORTUNITY: Considering all factors and arguments analyzed in this report, we believe REW truly represents a highly profitable investment opportunity at a very attractive current valuation. Research, analysis and valuation of all possible factors influencing REW’s future performance represent a solid framework for a potential super-success. Nevertheless, we would like to attract investors’ attention to the potential risks affecting this investment opportunity: notably REW’s ability to retain and grow a solid customer base, to generate scalable revenues and control costs, technology and product risks, market and sector risks and the ability to obtain required financing. Investors are invited to conduct their own analysis of the factors presented in this report in order to estimate the profitability worthiness of this opportunity. SECTOR: SaaS Referral Marketing Solutions Software Applications Valuation and Research Report RewardStream Solutions - REW TSX Ticker: REW Frankfurt Ticker: JL4L WKN No: A2APX1 RewardStream Solutions Inc. (REW) is a SaaS company specialized in the tactical execution of referral marketing programs that help brands to acquire, engage and retain new customers, by leveraging their existing customer base. The company is based in Vancouver, Canada. It has already penetrated the market and is currently working with prestigious brands like Virgin Mobile, Wind, Rogers, Boost Mobile, AT&T, TotalProtect, First Calgary Financials, etc. Initiating Coverage Strong Buy Price at 10.08.2016 CAD 0.41 Price target 12-months CAD 1.93 52-week range 0.08 - 0.65 Stock InformationStock & Trading InformationMarket Cap (CAD) 15.85 million Shares Outstanding 38.66 million Fully Diluted 43.32 million Corporate Highlights:  Recently closed an Amalgamation with Musgrove Minerals Corp. (MGS) on the TSX Venture Exchange  Major brands like Virgin Mobile, Wind, AT&T, Rogers, etc. as corporate customers  Closed 10 corporate customers in the past 6 months and in late discussions to close 9 more  CAD $21.2 million projected revenues for 2019 REW: CN – 1 Year Price Chart Source: Bloomberg
  5. 5. RAMPartners SA Bvd Georges-Favon 19, 1204 Geneva, Switzerland Email: info@rampartners.ch Analyst Email: ey@rampartners.ch Telephone: +41223108602 RewardStream Solutions Inc. Author: Erenik Yzeiraj, Analyst 10.08.2016 VALUATION Discounted Cash-Flow Model (DCF): Our DCF model attributed RewardStream a value of CAD $2.10 per share today. REW has been generating revenues since at least 2013 (only public information available). In 2013 they had revenues of CAD $2.08 million, CAD $1.86 million in 2014 and approx. CAD $1.5 million in 2015. Based on our assumptions, REW’s Management team with its expertize, track-record and the right Marketing & Sales, REW will be able to generate CAD $1.75 million in revenues in 2016. According to the Management’s projections, which we find reasonable considering the current pipeline, the company will be able to generate CAD $3 million in 2017, CAD $8.5 million in 2018 and CAD $21.2 million in 2019. We assumed a year-on-year revenue growth estimation for years 2019-2026 at 30% (industry standards plus a premium for REW’s Management), then by attributing a perpetual revenue growth of 7% for the second 10 years. We assumed a COGS level at 40% of revenues, as general industry standards are between 35%-50%. R&D (software development & enhancement) is estimated to stay steady at an average of CAD $2 million per year, as REW’s software has low ongoing work requirements compared to other complex architectures. In order to achieve the optimistic revenue targets, REW will need to spend 35% of Revenues in Sales & Marketing. Then we estimated the appropriate risk discount factor for REW at 15% (WACC=10% plus a 5% risk premium for the early commercial stage). REW has currently CAD$2,000,000 in cash. Hardware depreciation is assumed at CAD$15,000. Sector-standard Net Working Capital is: Accounts Receivable are 13.68% of Sales, Accounts Payable at 4.95%, Inventory at 2.08% and Non-Cash Working Capital at 11.45%. We estimated CAPEX at negligible levels for our horizon, as the necessary expenditures for the operations has been already used in the past. We assumed the company will need another financing of CAD $1,000,000 (assumed at CAD $0.50/share) before cash-flow positivity. This will result in a total shares outstanding of 40,657,069. Comparables - Market Pricing: Our peers’ universe selection criterion was primarily the product/service offered (SaaS in Internet Marketing) target customers (e-marketers, online businesses) and geographical market exposure (North America and Europe). Companies satisfying these criteria are believed to be influenced by the same forces and market trends that REW will be, in our scenario. Revenue based multiples (EV/Sales and P/Sales) were used for our Comparables model, as an important portion of SaaS or Internet Marketing companies have negative or insignificant EBITDA. We averaged (equally weighted) the average EV/Sales and P/Sales multiples and divided the outcome with the projected number of shares outstanding (40,657,069). That gave us a future share price of CAD $3.55. We used the same risk factor as in our DCF model (15%) to discount back to 2016. The target stock price, based on our model, is CAD$ 1.76. Sensitivity Analysis: In order to get a variation of key elements to REW’s future share price, we have decided to perform a Sensitivity Analysis for both our valuation models. For both DCF and Comparables, the main factors that we decided to vary are the projected Revenues and the discount Risk factor. We believe these are the most sensitive variables. All factors were varied on the range -40%, -20%, +20%, +40%. We have averaged both valuation models (equally weighted) to compute our final valuation for REW. The outcome is CAD $1.93 per share. Our price target reflects the successful breakthrough of REW’s solution in an environment that desperately needs it. DCF Value per Share: CAD $2.10 Comps Price per Share: CAD $1.76 Source: Bloomberg Peers' Universe Enterprise Price Company Name EV/Sales P/Sales 1.Shopify 10.6 11.24 2.Snipp Interactive 1.68 2.27 3.YuMe 0.31 0.67 4.Wix.com 5.98 6.38 5.TubeMogul 1.44 1.77 6.Rocket Fuel 0.26 0.23 7.Tremor Video 0.21 0.51 8.HubSpot 8.7 9.22 9.Marketo 6.16 6.56 10.GoDaddy 3.28 3.07 Average 3.86 4.19 Variation -40% -20% 20% 40% Target Stock Price 1.10 1.60 2.60 3.10 Target Stock Price 1.65 1.84 2.46 3.03 Target Stock Price 12.37 4.05 1.28 0.85 Target Stock Price 1.06 1.41 2.12 2.47 Target Stock Price 2.31 2.01 1.55 1.37 Discount Factor Revenues 2021 DCF Sensitivity Comps Sensitivity First 5 Years Revenue Projection Discount Factor Perpetual Revenue Growth (2026+) EV (Present Value FCF) CAD 83'246'641 Cash CAD 2'000'000 Debt CAD 0 Total Equity Value CAD 85'246'641 Shares Outstanding 40'657'069 Value per Share CAD 2.10 REW DCF Valuation 2016 CAD 1'750'000 2017 CAD 3'000'000 2018 CAD 8'500'000 2019 CAD 21'200'000 2020 - 2026 30% YoY 2026 + 7% YoY COGS 40% of Sales R&D 10% of Sales Sales&Market. 35% of Sales DCF Horizon 20 Years Beta 1.4 Acc. Rec 13% of Sales Acc. Payable 4.9% of Sales Inventory 2.1% of Sales Non Cash WC 11.5% of Sales NWC Assumptions & Rationale Growth Operational Expenses Revenue Projection Sales 2021 Median Multiples Valuation Model Valuation Shares Outstanding Future Stock Price Risk Factor Price per share 1.76 15% 3.55 REW Comparables Valuation CAD 35'828'000 EV/Sales= 4.54; P/Sales= 4.79 Sales*(Sum of Average Multiples/2) 144'279'356 40'657'069
  6. 6. RAMPartners SA Bvd Georges-Favon 19, 1204 Geneva, Switzerland Email: info@rampartners.ch Analyst Email: ey@rampartners.ch Telephone: +41223108602 RewardStream Solutions Inc. Author: Erenik Yzeiraj, Analyst 10.08.2016 GLOBAL INDUSTRY ANALYSIS Overview: Referral Marketing is the disruptive sub-market of the global Internet Marketing industry. Referral Marketing relies on the potential of promoting products to new customers, through existing customers’ recommendation. Trends, Facts and Forces: Recent studies have displayed the tremendous advantages and value add of referral marketing. A global survey conducted by Nielsen in 2016 shows that 92% of consumers trust recommendation from people they know. Nowadays we are more and more overwhelmed by the over-abundance of advertisement and products. Recommendation cuts through this noise, quickly and effectively. It is estimated that a well handled referral program guarantees a response ratio up to 70% and conversion rates of 0.8-1.5 new customers acquire per active campaign. Referred customers, as they’re less price sensitive and ready to purchase, they represent buying with higher profit margins for businesses (estimated at 25% higher). A referral marketing survey conducted by REW and Demand Metric concluded that 72% of consumers have made a purchase on recommendation and 52% have recommended. Opportunities for profitability: Despite highly sophisticated algorithms and databases that can predict when a customer will make a future purchase, the value of any customer does not reside only in what that person buys. How the customer feels about it and what he’s willing to tell others about your product impacts Revenues and Profitability just as much. Approximately 41% of businesses don’t have a specific referral marketing program (RewardStream Solutions and Demand Metric, 2016). 48% manage referral marketing in-house. Half of the 41% without a program have no specific plans on the program implementation and the other half intends to launch very soon. The main obstacles for marketers is budget, marketing resources, expertise and executive support – all surmountable by outsourcing to referral marketing specialists, like REW. These statistics reflect a tremendous profitability opportunity. A very important aspect of referral marketing is the multiplier effect: referred customers will bring in more referred customers if they value positively the product. While costs are kept under control, revenues are increasing tremendously. Market performance: We believe REW’s performance will be influenced by the same forces shaping SaaS companies’ performance, especially in the Marketing & Advertisement space. Despite the high SaaS companies’ valuation in 2013 and the following correction in 2014, SaaS stocks have generally out-performed NASDAQ composite in the past four years. SaaS growth rates are three to five times those of traditional public software companies. Companies with YoY revenue growth of less than 25% have been trading at around 4x revenues whereas those with YoY growth of +50% have shown revenue multiples of around 13x (Bloomberg, S&P Capital IQ, Morningstar). After the important decline in LinkedIn (LNKD) and Tableau (DATA) in early February 2016, followed by a selloff in other stocks as well, the overall sector bounced back and showed signs of solid performance. Most of the active SaaS stocks covering the selloff were SalesForce (CRM) +3.53% YTD, ZenDesk (ZEN) +16.26% YTD, DST Systems (DST) +6.54% YTD and also the best performing Ebix (EBIX) +67.89% YTD and Model N (MODN) +23.30%. S&P Advertising Index YTD Performance S&P Advertising Index Nasdaq Composite S&P Composite Source: Software Equity Group 2015 Source: RewardStream Solutions & Demand Metric, 2016 Source: RewardStream Solutions & Demand Metric, 2016 “Referral Marketing is an effective channel for acquiring new customers” How do you manage your Referral Marketing program? Implementation plan of Referral Program Source: RewardStream Solutions & Demand Metric, 2016 Recent SaaS Index Performance (2014-2015) Source: Bloomberg
  7. 7. RAMPartners SA Bvd Georges-Favon 19, 1204 Geneva, Switzerland Email: info@rampartners.ch Analyst Email: ey@rampartners.ch Telephone: +41223108602 RewardStream Solutions Inc. Author: Erenik Yzeiraj, Analyst 10.08.2016 COMPANY ANALYSIS Business Model: The company’s operations have been generating +$1 million revenues since at least 2013 (only public information available). In 2013 REW had revenues of $2.08 million, $1.86 million in 2014 and approximately $1.5 million in 2015. The decline in revenues is explained by the shift in technology and positioning the company went through. From a loyalty program vendor, the company became a SaaS referral marketing solutions provider. Employing the SaaS model, REW provides execution and overall management of referral marketing programs allowing businesses to monetize their existing customer base by acquiring new referred customers. REW generates revenues in three ways: Launch Fees, Monthly Fees and Success Fees. It targets Enterprise (E), Medium (M) and Small (S) businesses. The Revenue model is straight-forward: Launch Fees of $10k-$20k to setup the program (only for entreprise); Monthly fees: E [$5k-$10k]; M [$500-$1,000]; S [$99-$199] to keep the program running with full functionalities; Success Fees: $1 to $25 per new customer or a percentage of total sales. Basically, REW becomes an outsourcing service for handling the referral marketing program of businesses, through its SaaS model. Products & Technology: The software, called Spark, is highly configurable and semi- custom. The technology and architecture behind is fully patented and fully compliant with digital communication law. The marketer does pretty much nothing, the application itself and REW’s team will do 99% of the work. Along with the software, REW provides a full range of services: hosting, security, fraud prevention, member care, best practices, built-in promotion functionalities, reward analytics and dedicated account management. In overall, REW has two offerings: the software on one hand side and the full range of complementary services on the other. Competitive Advantages: It is one of the most complete, time saving, efficient, cost optimized solutions out there. With a smooth and elegant interface, it offers ease of use to marketers. It allows any Marketing Manager to highly customize the referral program, to analyze the results and improve the overall marketing efficiency, all in a highly secure way. While keeping marketing budget under control and at low levels, the marketer can reach out to prospective customers cutting through the confusing and overwhelming noise around consumers. It can rely on REW’s team’s support to optimize the program and generate warm quality leads to convert into revenues. Commercial Stage: REW has generated $300 million in new business for its clients so far. Its customer base is composed by prestigious brands like RBC, Sprint, AT&T, Virgin, Wind, etc. In the past 6 months REW’s team have already closed 10 enterprises and is in late discussion with 9 more. The company has already penetrated the market with existing customers and ongoing sales. With the trust of reputable brands, REW will find it easier to further develop its business. Its current achievements reflect a solid proof of concept and market need for its solutions, as well as a successful overall sales effort. Profitability & Margins: We estimate COGS are comprised of Advertisement & Customer Acquisition, Software Implementation and Customization, Help Desk Support, Hosting and Maintenance. Operating Expenses usually concern Overhead (salaries, software development & enhancement), G&A, Marketing and Sales. REW’s current Gross Margin are at 60%. We estimate EBITDA and Net Margin should constantly grow to reach the 20% and 15% respectively. The SaaS model in the Internet Marketing space is typically characterized by high COGS requirements but usually moderate and steady OPEX. We believe REW’s business model has the ability to generate and expand substantial cash-flow. Considering the company’s current sales pipeline, cost structure and offerings, projected margins in this report are realistic. Capital Structure & Financing: The company recently closed a non-brokered Private Placement at CAD $0.25/share for net proceeds of CAD $2,028,500. A prior Convertible Note of CAD $217,488 was fully converted (principal and interest) into 869,954 shares with 1 year hold. 20% of the converted shares were released on Closing of the financing and every three months there will be 20% more released. There are currently 38.6 million shares outstanding. The company has 4,057,000 Warrants at an exercise price of CAD $0.50 and 603,925 others at various prices (historical warrants). In total, REW has 42,448,040 fully diluted shares. The current capital structure reflects a solid situation with no substantial obstacles to potential share price appreciation. The Referral Marketing Funnel Revenue Generation RewardStream’s Current Clients To what extend do you trust the following forms of advertising? Ownership:  Management: 16%  Friends and Family: 12%  1 Year Voluntary Pool: 26%  New Investors (Placement): 21%  Existing Investors: 13%  Float: 12%
  8. 8. RAMPartners SA Bvd Georges-Favon 19, 1204 Geneva, Switzerland Email: info@rampartners.ch Analyst Email: ey@rampartners.ch Telephone: +41223108602 RewardStream Solutions Inc. Author: Erenik Yzeiraj, Analyst 10.08.2016 MANAGEMENT Our Management analysis framework is based on Management’s “skin in the game”, incentives, track-record, reaction to turbulence and business priorities within the company.  “Skin in the game”: REW’s management team represents the third largest shareholder in the company (16%). They have participated in the recent financings of the company. Their personal financial involvement in the company’s equity reflects what every investor is looking for in a management team: belief and conviction in the company’s success.  Incentives: Since the amalgamation was closed very recently, there are no publicly available audited financials up to date yet. Therefore, we cannot derive any executive compensation policy from the company so far.  Track-Record: REW is led by a stellar management team. The team brings a combination of successful entrepreneurial experience (Contigo Systems, Class Software Solutions and PayByPhone) with corporate involvement (TIO Networks, Sierra Wireless, Contractually). The current CEO, CFO, VP Operations and VP Product & Marketing have met each other at their experience within Contigo. Successes and achievements include: o CEO: designing the strategy of TIO’s payment Wallet (over $1 billion per year in payments), o VP Sales: helped grow PayByPhone from start-up to acquisition by PayPoint for $43 million o CFO: has raised over $20 million for tech and biotech companies o VP Operations: launched first consumer telematics solutions at Contigo and oversaw full delivery system at TIO Networks o VP Product and Marketing: brought successful products to market for Glenayre, Infowave, Sierra wireless, Vision Critical, Contigo and Contractually. o Software Architect: Software Engineer at CAE and OpenText With this successful track record rich in marketing, sales, technology and business expertise, REW’s team is on the right track to make REW its next success.  Reaction to turbulence: The combination of entrepreneurship with corporate background gives a management team the necessary creativity and discipline it needs to react to external and internal pressures. With the existing business complexity, markets’ volatility, investors’ impatience, customers’ unpredictability and constant commercial environmental change, we almost always need to see experienced grey hair alongside with hands-on adventurous dynamism. The current team has what it takes to handle potential problems.  Business priorities: Our research indicates that REW’s executives do not currently hold any executive positions in any other project or company. Therefore, their time, energy and focus are fully dedicated in providing revenue growth, profitability and shareholder value. We conclude that REW Management has the necessary skills, ability, devotion, focus and “skin in the game” to do everything in their hands to make this project work. Management Analysis: Our in-house model shows that management has the necessary skills, ability, devotion, focus and “skin in the game” to do everything in their hands to turn RewardStream into a big success and ultimately provide value for shareholders. RewardStream’s Management Team
  9. 9. RAMPartners SA Bvd Georges-Favon 19, 1204 Geneva, Switzerland Email: info@rampartners.ch Analyst Email: ey@rampartners.ch Telephone: +41223108602 RewardStream Solutions Inc. Author: Erenik Yzeiraj, Analyst 10.08.2016 Disclaimer Copyright 2016 RAMPartners SA. All rights reserved. This report has been prepared and issued by RAMPartners. All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report. Opinions contained in this report represent those of the analyst at the time of publication. The securities described in the Investment Research may not be eligible for sale in all jurisdictions or to certain categories of investors. RAMPartners does not offer or provide personalized advice. We publish information about companies in which we believe our readers may be interested and this information reflects our sincere opinions. The information that we provide or that is derived from our website is not intended to be, and should not be construed in any manner whatsoever as, personalized advice. Also, our website and the information provided by us should not be construed by any subscriber or prospective subscriber as RAMPartners’ solicitation to effect, or attempt to effect, any transaction in a security. This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. This document is provided for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. RAMPartners has a restrictive policy relating to personal dealing. RAMPartners does not conduct any investment banking business with the company and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of RAMPartners may have a position in any or related securities mentioned in this report. RAMPartners was not compensated for this report. RAMPartners or its affiliates may perform services or solicit business from any of the companies mentioned in this report. The value of securities mentioned in this report can fall as well as rise and are subject to large and sudden swings. In addition, it may be difficult or not possible to buy, sell or obtain accurate information about the value of securities mentioned in this report. Past performance is not necessarily a guide to future performance. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations. The distribution of this document is not a “personalized service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by RAMPartners (i.e. without taking into account the particular financial situation or goals of any person). To the maximum extent permitted by law, RAMPartners, its affiliates and contractors, and their respective directors, officers and employees will not be liable for any loss or damage arising as a result of reliance being placed on any of the information contained in this report and do not guarantee the returns on investments in the products discussed in this publication.
  10. 10. RewardStream Investment Opportunity RewardStream specializes in the tactical execution of referral marketing programs that help brands to acquire, engage, and retain customers. The company’s platform uses innovative marketing insights and proprietary technology to turn the existing customer base into a powerful new sales channel for clients. To put this into perspective, RewardStream has acquired $300M in new business for clients in two years. Given the importance for companies to acquire new customers in an overly complicated marketing space, RewardStream presents a proven and innovative way to ‘Rise above the Noise.’ According to Yankelovich Consumer Research: “We’ve gone from being exposed to about 500 ads a day back in the 1970’s to as many as 5,000 ads today.” Why Referral Based Marketing? The main reason for the success behind referrals and RewardStream is: Recommendations Build Trust + Drive Action Consumers are 4x more likely to buy when Recommended by a Friend RewardStream Successes RewardStream has focused on securing clients in the Telecom, Financial Institution, and E-Commerce industries. Key customers include AT&T, Telus, Boost Mobile, Rogers, WWE, Envision Financial, and more. Key Statistic: Boost adds over 20,000 new customers via RewardStream each month. Drove over 900 Qualified or higher leads in last 6 months Delivered $300 million in new business to our clients (and counting...) Over $1.7M in new annual recurring revenue in pipeline Go-public fundraising proceeds of $2m proceeds could result in a 3 to 4x increase in sales funnel within 2 quarters ‘Pioneering the Referral Marketing Space’ Inventure Capital Markets Gurinder Sandhu RewardStream Inc. REW.TSXV On target to close over $1.75M in revenue in Fiscal 2016 with over $1.4M in recurring revenue and 60% gross margins August 2016
  11. 11. [Type here] [Type here] [Type here] REW:TSX Venture Exchange Referral Marketing Industry A recent survey by RewardStream showed that 71.9% of people surveyed had purchased something which was recommended to them by a friend – and with 88% of marketers believing that referral schemes help them to acquire new customers, it’s no surprise that nailing a great referral program will help to underpin many a successful marketing strategy. Dropbox, for example, built their user base from 100,000 to 4,000,000 in 15 months, by offering a bonus of extra storage space to anyone who referred a friend – that’s over 250K new users a month on average. The Dropbox referral campaign was influenced by Paypal, who led the way by offering a cash reward, and gaining 7-10% daily growth in the early years of their business.
  12. 12. [Type here] [Type here] [Type here] REW:TSX Venture Exchange Why Referral Marketing - Trust With a small cost to the marketer and a high potential for reward, referral marketing can deliver one of the highest returns on investment by leveraging your most loyal customers to become active brand evangelists. Direct incentives (gift cards, discounts, free prizes, etc.) were the most popular incentives among a survey group, with more than 60% of respondents saying they would be at least “somewhat more likely” to refer a friend if they received something tangible or of monetary value in return. However, when a referral marketing program is working, it’s found that it has the lowest cost per customer acquisition of any marketing strategy. More importantly, referral customers bring robust value to businesses. A Harvard Business Review study looked at a German bank to assess the value of clients attained through their referral marketing program. The study found that customers who came from referrals were 18% more likely to remain with the bank indefinitely and would generate 16% more in profits than non-referral clients.
  13. 13. [Type here] [Type here] [Type here] REW:TSX Venture Exchange Perhaps the best part of the referral process is that it can repeat over and over again. If referred customers are more loyal and valuable than other types of customers, then they are also top candidates for being referrers themselves. As a result, over time, referral marketing can slowly improve the quality and loyalty of your entire customer base. RewardStream’s Value Proposition RewardStream encourages companies to look at their current marketing tactics and the conversion rates of each. RewardStream then shows how companies can get, on average, 35% more new customers with minimal extra investment. Also, these customers are expected to be more loyal to the brand, more likely to stick around for years, more liable to spend money on products and services, and more likely to refer their friends and family members to the business. Most companies would take the opportunity to apply those numbers and analyze the trends to their bottom line. Word of mouth marketing (WOMM) is one of the oldest forms of referral marketing, and optimizing its conversion rate has been a business priority for centuries. RewardStream’s referral programs track many different metrics for customers, including:  how many existing customers were attracted to the program to become advocates  how many people (advocates) make a referral (and how many referrals they make)  how many leads are generated (potential new customers who have been referred) and finally …  how many actual new customers are generated from the program. Statistics on other forms of Online Marketing: According to the direct marketing association, the median return on investment for digital marketing methods ranges from 6% for internet display ads, to 23% for email marketing. The click-through rates of display ads is reported to be around 0.17%. That means companies’ ads needs to reach 588 people for one to click through. Pretty abysmal conversion. Average email click through rates are around 3%, meaning companies need to reach about 33 people for one to click through. And then, those that do click through still need to make a purchase decision, which further dilutes the conversion rate. Key RewardStream Referral Program Questions: 1. How many people do I need to attract to my referral program in order to generate one new customer? o Snapshot: 4:1 average  This means that across a sampling of clients (across industries), on average they attracted 4 potential advocates in order to generate a new customer.  This is an average conversion rate of 25%
  14. 14. [Type here] [Type here] [Type here] REW:TSX Venture Exchange 2. How many people do I need actually making referrals (customers who became advocates) in order to generate one new customer?  Snapshot: 2:1 average  Across that same sampling of clients/industries, they generated an average of one new customer for every two advocates who made a referral.  This is an average conversion rate of 50% Other Key Referral Marketing Metrics:  92% of consumers around the world say they trust earned media, such as recommendations from friends and family, above all other forms of advertising.  84% of global consumers say word of mouth is the most trust worthy source of product recommendations.  77% of consumers are more likely to buy a new product when learning about it from friends or family. Why Referral Marketing Fees are lower than Traditional Methods A recent study from Demand Metric indicates that 71% of marketing professionals feel that referral marketing fees are lower than most traditional customer acquisition methods. We continue to be oversaturated by traditional and digital marketing methods that advertisers employ. The fact is, the more of those messages seen, the more those messages are irrelevant to you. The marketers who created the message aren’t likely people that you know personally; there are many degrees of separation between you, the audience, and them. This separation creates a gulf that must be crossed with some form of familiarity. Hence the performance of these wide-gulf marketing programs is poor, while the costs can be relatively high. When the marketer is someone you trust, someone you know personally, or perhaps even someone you love, that marketing message suddenly carries more importance. This is the heart of referral marketing, and it occurs when the recommendation to buy a product or service comes from someone who is separated from you by only one degree; someone you know personally. And, perhaps not surprisingly, referral marketing fees are well below the average cost of other methods of customer acquisition. Value of Referral Marketing Example: A company is trying to acquire a customer who will spend $25 per month on a subscription service. Let’s say that the average client has a lifetime-value of 3 years, or $900 to the business. Let’s say that the company generated a direct email campaign to reach that customer, and converted successfully. Market statistics say that it will have cost an incremental $775 in advertising fees to acquire that one customer.
  15. 15. [Type here] [Type here] [Type here] REW:TSX Venture Exchange However if one of the existing customers, already happy with the service, recommended a friend, and that friend signed up, the costs would have been significantly lower. In fact, for the cost of the referral marketing program itself, as well as paying a small reward to the referrer and the new customer, net incremental costs would be closer to $75 in referral marketing fees, or about 90% less than traditional methods. Referral marketing will also provide the lowest cost per acquisition that will provide 15x the conversions of email, affiliate, site visits, or keyword searches. 92% of people trust recommendations from their friends and family over all other forms of advertising. According to Ken Krogue, the President of InsideSales.com: A direct referral lead is “36 times more valuable than a lead generated by a cold call, ten times more valuable than a trade show lead, and four times more valuable than a web lead.” RewardStream & Financial Institutions How Does Referral Marketing Fit In? Rewardstream’s current Financial Institution clients share these traits:  They are very modern but have a limited proven track record  They are quite niche  They target a specific market – one that tends to skew young, is tech savvy and open to risks but tends to be marginalised by traditional financial services  The institutions involved are also open to risk-taking behaviour  Service providers are deliberately going after disenfranchised markets  Referral marketing has also proven to be a very successful customer acquisition tool within industries that have a small or specialized customer base.
  16. 16. [Type here] [Type here] [Type here] REW:TSX Venture Exchange
  17. 17. [Type here] [Type here] [Type here] REW:TSX Venture Exchange RewardStream & Telecom Companies One of the biggest challenges facing telecommunications services today is churn—the intense competition to keep customers while also enticing dissatisfied customers away from your competitors. RewardStream’s referral program makes it easy to motivate customers and employees to refer their friends and family and, then, to reward everyone for participating. Testimonial from Boost Mobile: “A year since launching the Spark referral program, we have seen continued growth in the number of new customers. The referral program has proven to be a powerful way for our customer base to share Boost’s attractive deals and pricing with their friends and family members.” “The referral program has proven to be a powerful way for our customer base to share Boost’s attractive deals and pricing with their friends and family members.” Boost’s New Customers growth with RewardStream Platform: RewardStream’s New Client Acquisition in last Six Months:
  18. 18. [Type here] [Type here] [Type here] REW:TSX Venture Exchange RewardStream’s Growth Engine will mainly be from E-Commerce Significant growth will come from making the referral platform available as an “app” in existing platforms that serve millions of businesses which Magento and WooCommerce already in development. There are many online application plug-ins which quickly achieve around 5,000 E-commerce with no marketing, and in a short period of time. Given RewardStream knows marketing, it is exciting to track how fast the platform rolls out to the E- commerce Ecosystem with marketing and a great push from the RewardStream team. This can result in quick scale and quick revenue increases. Capital Markets Info (REW.TSXV) Unrestricted Float: 4,448,603 + Friends and Family: 4,500,000 + 1 Yr Voluntary Pool, from Investors: 9,708,818 + Non-Insider 3 Yr Escrow: 5,016,184 + Mgmt/Insider 3 Yr Escrow: 5,999,510 + Private Placement @ $0.25, raising $2,028,500: 8,114,000 = Total Issued POST Closing: 37,787,115 + Warrants @ $0.50, adding a potential $2,028,500: 4,057,000 + Historical Options, various prices: 603,925 = Total Fully Diluted: 42,448,040
  19. 19. [Type here] [Type here] [Type here] REW:TSX Venture Exchange Share Price as of August 8th , 2016: $0.38 Market Capitalization: $14.36M Sales Analysis  2016-19 Sales CAGR: 87%  Current Recurring Revenue: 85% of Current Sales  Clear increase in gross margins. For the quarter ended Dec.31, 2015, it is impressive to note 60% margins with healthy revenues.  Rob Goehring, CEO, and the other seasoned veterans on the management team (below) took over RewardStream in 2014. RewardStream used to be a one-time service fee company, however, this team has transformed the company into a recurring revenue, SaaS based Referral Marketing company. In 2015, the company flash sold the legacy lines and today we see a 85% recurring revenue company with good consistent cash flows. Management Team Neil Parker: VP Product Management and Marketing Neil has 20 years experience in Product Management and Marketing at companies such as Glenayre, Infowave, Sierra Wireless, Contigo Systems and Contractually. He has also spent the last 30 years as a semiprofessional drummer and plays with a number of acts you’ve never heard of, but it keeps him off the streets at night. Neil just wants to work every day with amazing people to deliver applications that become stitched into the fabric of everyday life. Rob Goehring: Chief Executive Officer Rob is seasoned technology executive with over 17 years of experience leading early stage, high growth, scalable companies. As the co-founder of Contigo Systems Inc., Rob lead marketing and product strategy for five different product launches. Rob was also responsible for establishing the company’s B2B channel partnerships where he built out channel marketing programs, tools and training for Contigo’s independent VAR channel. Most recently as the Chief Marketing Officer at TIO Networks, Rob led the B2B teams for Marketing, Sales and Account Management. He was also responsible for the strategy for TIO Wallet - TIO's cloud based digital wallet 2014 2015 FY2016 FY2017 FY2018 FY2019 Sales $1.86M ~$1.66M $1.75M $3.0M $8.5M $21.2M Gross Margins 43% 57% 60% 63% 65% 70% Dec 31, 2015 (3Months) Sales 436,309 Gross Margin 60%
  20. 20. [Type here] [Type here] [Type here] REW:TSX Venture Exchange - that processed millions of transactions per month, totalling over $1 billion per year in bill payments via our self-serve kiosk, over-the-counter, web and mobile payment solutions. Charles Abel: Chief Financial Officer Charles is responsible for managing RewardStream's financial operations. He has held financial positions of increasing responsibility throughout his professional career, for both public and private companies in the high tech and biotech industries. In his various roles, Charles has raised over $20 million in equity and debt financings and managed company budgets in excess of $10 million. Charles holds a CGA-CPA designation and has an executive M.B.A. from Simon Fraser University. Charles was most recently the VP Finance for Contigo Systems, where he was also responsible for the integration of acquired companies and assisted in the sale of Contigo to Vecima Networks. Buzz Hemphill: Vice President of Sales As the VP Sales for PayByPhone, Buzz helped grow the start-up company to acquisition by PayPoint plc for approximately $43 million. In the 9 years at PayByPhone, Buzz oversaw growth from 10,000 to over 2 million transactions a month and from 8 to 120 clients organization in over a thousand locations including the City of San Francisco, New York City (pilot) and City of Miami. Previously as the VP Sales of Class Software Solutions ltd., Buzz helped maintain a 35% growth rate and grew the company to $18 million in revenue. He expanded Class into multiple vertical markets: recreation, City Hall, universities and YMCA and grew the sales team to twelve people, increased the average deal size by 30%, averaged 80 new customers annually. Devin Redlich: VP of Operations As a senior Operations executive, Devin has spent the past 18 years managing and tooling technology based organizations for scalability and growth in IT, Customer Support, Logistics, and Service Delivery. Most recently as EVP, Operations for TIO Networks, Devin led a complete re-architecting of a multi-datacenter service delivery environment, oversaw a multi-tiered customer support division including overseas call centers, and managed the operations and logistics of a nation-wide network of self-serve bill payment terminals. In addition to the oversight and management of operations, Devin has led the launch of a number of major strategic projects. Most notably, as Director of Operations for Contigo Systems, Devin led the launch of Contigo’s first consumer telematics solution in partnership with the largest telematics brand in the automotive industry. Devin is actively involved in all elements of RewardStream Operations, from strategic initiatives to hands-on involvement in day to day operations. Kevin Campbell: Senior Software Architect Kevin is the lead software architect at RewardStream, having designed and lead development of the Spark referral platform for the last 5 years. During this time, Kevin has designed, developed, and launched successful loyalty and referral marketing solutions for clients around the world, and has overseen the design and implementation of core platform improvements, websites, social media integrations, and API framework. Kevin is a passionate technologist, with deep interest and understanding of software architecture, modern web frameworks, mobile devices and tech policy. Prior to RewardStream, Kevin spent time at CAE and OpenText as a software engineer and holds a bachelor’s degree in Mathematics and Engineering from Queen’s University.
  21. 21. [Type here] [Type here] [Type here] REW:TSX Venture Exchange Appendix: Demand Metric Benchmark Report (June 2016) Key Figures
  22. 22. [Type here] [Type here] [Type here] REW:TSX Venture Exchange
  23. 23. DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: www.equities.com/disclaimer [Type here] [Type here] [Type here] REW:TSX Venture Exchange
  24. 24. 24 Disclaimer and Information on Forward Looking Statements: All statements in this report, other than state- ments of historical fact should be considered forward-looking statements. Much of this re- port is comprised of statements of projection. Statements in this report that are forward looking include that RewardStream Solutions Inc. or any other company or market will per- form as expected; that RewardStream will complete transactions; that RewardStream or its partner(s) can and will start growing or ad- vancing its technology to other platforms and customers; that the company can raise suffi- cient funds for future transactions, develop- ments and other corporate matters; that any of the mentioned plans, comparisons with other companies, regions or numbers are valid or economic. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual re- sults or events to differ materially from those anticipated in these forward-looking state- ments. Risks and uncertainties respecting new technologies and software companies are generally disclosed in the annual financial or other filing documents of RewardStream and similar companies as filed with the rel- evant securities commissions, and should be reviewed by any reader of this report. In addi- tion, with respect to RewardStream, a num- ber of risks relate to any statement of projec- tion or forward statements, including among other risks: the receipt of all necessary ap- provals and permits; the ability to conclude a transaction to start or continue generating revenues; uncertainty of future market regu- lations, capital expenditures and other costs; financings and additional capital require- ments for maintenance, development, con- struction, and operating of its platforms and corporation; the receipt in a timely fashion of further permitting for its legislative, political, social or economic developments in the juris- dictions in which RewardStream carries on business; operating or technical difficulties in connection with production or development activities; the ability to keep key employees, joint-venture partner(s), customers and oper- ations financed. There can be no assurance that such statements will prove to be accur- ate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. Rockstone and the author of this report do not undertake any obligation to update any statements made in this report. Disclosure of Interest and Advisory Cautions: Nothing in this report should be construed as a solicitation to buy or sell any securities mentioned. Rockstone, its owners and the author of this report are not registered broker-dealers or financial advisors. Before investing in any securities, you should consult with your financial advisor and a registered broker-dealer. Never make an investment based solely on what you read in an online or printed report, including Rockstone’s report, especially if the investment involves a small, thinly-traded company that isn’t well known. The author of this report is paid by Zimtu Capital Corp., a TSX Venture Exchange listed investment company. Part of the author’s responsibilities at ZimtuCapital Corp. is to research and report on companies in which Zimtu Capital Corp. has an investment. So while the author of this report is not paid directly by RewardStream Solutions Inc., the author’s employer Zimtu Capital Corp. will benefit from appreciation of RewardStream Solutions Inc.’s stock price. The author also owns shares of RewardStream Solutions Inc. as well as shares of Zimtu Capital Corp., and thus would also benefit from volume and price appreciation of its stocks. Hence, multiple conflicts of interests exist. Therefore, the information provided herewithin should not be construed as a financial analysis or recommendation but as advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. Rockstone and the author of this report do not guarantee the accuracy, completeness, or usefulness of any content of this report, nor its fitness for any particular purpose. RewardStream Solutions Inc. has not reviewed all of the content of this report prior to publication. Lastly, the author does not guarantee that any of the companies mentioned in the reports will perform as expected, and any comparisons made to other companies may not be valid or come into effect. Please read the entire Disclaimer carefully. If you do not agree to all of the Disclaimer, do not access this website or any of its pages including this report in form of a PDF. By using this website and/or PDF report, and whether or not you actually read the Disclaimer, you are deemed to have accepted it. Information provided is educational and general in nature. Analyst Profile and Contact Stephan Bogner (Dipl. Kfm. FH) Mining Analyst Rockstone Research 8050 Zurich, Switzerland +41-44-5862323 sb@rockstone-research.com Stephan Bogner studied at the International School of Management (Dortmund, Germany), the European Business School (London) and the University of Queensland (Brisbane, Australia). Under supervision of Prof. Dr. Hans J. Bocker, Stephan completed his diploma thesis (“Gold In A Macroeconomic Context With Special Consideration Of The Price Formation Process”) in 2002. A year later, he marketed and translated into German Ferdinand Lips‘ bestseller („Gold Wars“). After working in Dubai for 5 years, he now lives in Switzerland and is the CEO of Elementum International AG specialized in duty-free storage of gold and silver bullion in a high-security vaulting facility within the St. Gotthard Mountain Massif in central Switzerland. Rockstone is a research house specialized in the analysis and valuation of capital markets and publicly listed companies. The focus is set on exploration, development, and production of resource deposits. Through the publication of general geological basic knowledge, the individual research reports receive a background in order for the reader to be inspired to conduct further due diligence. All research from our house is being made accessible to private and institutional investors free of charge, whereas it is always to be construed as non-binding educational research and is addressed solely to a readership that is knowledgeable about the risks, experienced with stock markets, and acting on one’s own responsibility. For more information and sign-up for free newsletter, please visit: www.rockstone-research.com Research #1 | RewardStream Solutions Inc.

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