Rapidly Growing SaaS revenues in the

digital marketing anti-fraud segment

STOCK SNAPSHOT - Company Overview – 3 Nov 2019 Stock and Capital Structure Overview
Adveritas Limited (ASX:AV1) provides anti-fraud software-as- Management & Board own 22%: Mark McConnell
a-service (SaaS) solutions to the global digital marketing sector. 11.6%, CEO 7.2%, COO 2.8%. Top 20 own 51%.
Key Product – TrafficGuard software-as-a-service (SaaS) Ordinary Equity 2019A

TrafficGuard® is AV1’s flagship anti-fraud SaaS, blocking Shares on issue (m) 187.6
Share price (A$) – close Wed 30 Oct 2019 0.16
attempted mobile phone app install fraud at the click level. It
Market cap (A$m) 30.0
is internally developed, patent-pending and 100% AV1 owned. 12mth high-low (A$)
0.195 - 0.08
Large and Rapidly Growing Addressable Market High - 2 Apr 19; Low – 25 Jun 18
Exercise price
TrafficGuard® addresses digital marketing fraud, such as Expiry No. options issued (m)
(cps)
“human click fraud farms”, which defrauded advertisers of 10 (1) 25 Oct 2021 55.5
US$42 bn in 2019³, forecast to grow to US$100 bn fraud by 2023. 10 7 Dec 2020 1.0
15 24 Dec 2020 2.95
Marquee Global Customers 20 27 Mar 2022 3.0
Go-Jek –US$9.5 bn valuation, backed by Google, Visa, Tencent, 45 30 Mar 2020 1.5
45 25 Aug 2020 0.5
JD.com, Temasek and Blackrock, active in 144 cities across Asia, 15 19 Aug 2021 0.4
A$300k annual 12-mth minimum contract. Total no. options issued 64.85
Source: Adveritas ASX releases. Notes: 1. ASX-listed AV1O series.
Rappi – Latin-American US$2.5 billion food-delivery business;
Growing Annualised Recurring Revenues (ARR)
min A$32k per month, 24-month contract (>$750k total value)
AV1 commenced active commercial sales in Jan 2019.
Low-Cost, High Sales Leverage Model
ARR has grown rapidly to ~A$1.6m, with key trends:
TrafficGuard’s integrations with strategic partners (ie. agencies • 19% ARR growth in the month of October 2019
and CMPs) provide access to multiple potential clients.
• 78% ARR growth in the 6 months to October 2019
Agencies – MUV is a key client, a subsidiary of the world’s
• 157% ARR growth annualised year to date.
largest global agency, WPP PLC (market cap US$12.3 billion)
Campaign Management Platforms (CMPs) – this is where the Share Price – Absolute Performance
digital marketing ecosystem collaborates. TrafficGuard® has Share price is up ~3.6x from 4.5cps rights issue (Oct
integrated with the 2 largest CMPs – Partnerize and HasOffers 18) to 16cps (30 Oct 2019) driven by revenue growth.
Contracted Revenue Upgrades - Revenue Growth Option The market appears to be factoring in zero value for the
pipeline or potential contracted revenue upgrades.
Upgraded client contracts is a growth option across the
customer portfolio. Recent upgrades include Rappi (up from CHART 1: ADVERITAS SHARE PRICE

US$15k to US$22.5k/mth) and MUV (up from US$2k to AV1 Stock Price
20

US$10k/mth), demonstrating client satisfaction.

SHARE PRICE (CENTS PER

Key Recent News

SHARE)
10

Date Event
15-Oct-19 Strategy Presentation released
10-Oct-19 Rappi upgrades its contract to 2 years and min US$22.5k/mth
0

29-OCT-18 29-JAN-19 29-APR-19 29-JUL-19 29-OCT-19

09-Oct-19 MUV increases contract to 15 months and US$10k/month
20-Aug-19 New sales team hired in USA CHART 2: AV1 RELATIVE TO
ASX SMALL INDUSTRIALS INDEX
01-Jul-19 Signed A$300,000 1-year contract with GO-JEK
AV1 Relative to ASX Small Industrials
11-Apr-19 Signed a 2-year contract with Rappi AV1 Relative to base index = 100
ASX Small Industrials Relative to base index = 100
400

25-Mar-19 Integration with Partnerize campaign management platform

BASE INDEX

28-Feb-19 Integration with HasOffers campaign management platform

McConnell buys on-market and takes placement of 3,333,334
200

8-Nov-18 shares for 7.5 cps (67% premium to 4.5cps rights issue).

23-Oct-18 Successful tech entrepreneurs Mark McConnell & Adam Schwab

underwrite 4.5cps rights issue with listed call options AV10
0

(10cps exercise, 2021 expiry). 29-OCT-18 29-JAN-19 29-APR-19 29-JUL-19 29-OCT-19

Source: Reuters

This document does not constitute investment advice to any reader and is not a recommendation to buy or sell any securities o f any company.
We do not accept any responsibility for updating or correcting any errors or omissions which may become apparent after this has been is sued.

BLETCHLEY Park
Capital
Level 5, 1 Collins St, investors@bletchleyparkcapital.com.au
Melbourne, VIC 3000
 Rapidly Growing SaaS revenues in the
digital marketing anti-fraud segment

Balance Sheet Analysis – September Quarter 2019 Key Investment Considerations

September quarter 2019 cash balance was A$2.3m, with 1. Highly scalable global B2B Software-as-a-Service
an additional $2m expected from R&D refund (~$1m) and (SaaS) product called TrafficGuard® .
additional investment from Directors in recent placement 2. Best of breed SaaS product – Rappi and Go-Jek
($1m). selected TrafficGuard® after extensive global review
If listed AV1O options are fully exercised (currently 3. A$1.6m ARR, growing quickly with strong pipeline
>60% in the money), an additional ~$5.6m would be 4. Proprietary tech, patent-pending, 100% owned.
received. Existing large holders have demonstrated 5. High growth markets, with total digital marketing
appetite to continue with follow-on investment. spend forecast to rise from US$294bn in 2019 to
US$520bn by 2023 (Juniper Research).
Revenues are continuing to accelerate as the prospect
6. Highly aligned management and board, with
pipeline converts to contracted customers.
CEO/Co-Founder owning 7.2%, COO/Co-Founder
Sales and Marketing Strategies owning 2.8% and NED Mark McConnell 11.6%.
7. Low-cost, high sales leverage model through agencies
AV1 released a Strategy Update outlining 6 key sales and Campaign Management Platforms
strategies:
8. Visible path to cash positive given ARR growth
momentum and strong pipeline
1. Sector Education – showcasing TrafficGuard through
9. Proprietary big data from previous marketing
white papers, industry events and journal articles.
campaigns creates competitive entry barriers.
2. Campaign Management Platforms (CMPs) – major 10. Corporate potential: venture capitalists are actively
brands and networks use CMPs to manage their digital investing to create a “one-stop shop” for digital
advertising campaigns. TrafficGuard® is now directly marketing. Sector investors are well capitalized. For
integrated with several CMPs and other platforms, so example, investors in leading Campaign Management
their clients can easily access TrafficGuard® . Platforms HasOffers and Partnerise include Mithril
3. North American Expansion – a key target region for Capital Management LLC Greycroft DN Capital
international expansion, given it is 38% of global ad Accel, Icon Ventures and android co-founder Andy
spend. Recently appointed sales team can service Rubin's Playground Global.
clients in the USA during local hours. 11. Consolidating sector: Another anti-fraud player
Forensiq was acquired by IP Radius.
4. Emerging Markets Expansion – clients include Go-Jek
(APAC), Rappi (LatAm), Centauro (Brazil), Bukalapak CEO Performance Rights
(SE Asia). The CEO is incentivised to grow revenues, grow
5. Agency Channels – agencies provide exposure to EBITDA, and achieve break-even. CEO Performance
dozens of potential clients through their existing Rights vest in the event of an acquisition of AV1.
TABLE 2: CEO PERFORMANCE MILESTONES
clients, allowing AV1 to grow its pipeline quickly and
efficiently. No. AV1
Tranche Milestone
shares
6. Account Growth – as TrafficGuard® processes more 1 First 10 TrafficGuard clients 250,000
traffic for growth clients, client contracts are revised 2 First three Tier 1 clients 500,000
3 $1m revenue 500,000
and subscription tiers upgraded, improving revenue
4 $3m revenue 1,000,000
per client. 5 $5m revenue 1,500,000
6 Break-even cash flow year 1,000,000
Equity Analyst. Coverage 7 $1m EBITDA 1,500,000
8 $3m EBITDA 2,000,000
1. No stockbroker research coverage. Total 8,250,000
2. See other BPC research notes: Source: Notice of General Meeting, ASX Release dated 24 May 2019
• Understanding the mobile app install ecosystem and cashflows Outlook and Key Catalysts
• Show me the money – Tracking high profile investors in the
digital marketing ecosystem 1. Growing annual recurring revenue
2. New enterprise level SaaS clients
3. More campaign management platform integrations
4. North American sales revenue growth
Email for any questions –
5. Product expansion including programmatic
investors@bletchleyparkcapital.com.au 6. VC/PE consolidation of CMPs and sector generally

BLETCHLEY Park
Capital
Level 5, 1 Collins St, investors@bletchleyparkcapital.com.au
Melbourne, VIC 3000
 Rapidly Growing SaaS revenues in the
digital marketing anti-fraud segment

Board Executive
Diverse Board skills with ability to drive global APAC appointments highlight AV1’s focus on
commercialisation of AV1’s proprietary technology scaling TrafficGuard® globally

Stephen Belben | NON-EXECUTIVE CHAIRMAN Mathew Ratty | CO-FOUNDER & CEO

• 9 years as senior corporate and audit • Previously held multiple roles with AV1 including
assurance partner at EY NED, Executive Director Business Development.
• 20+ years experience in executive and NED Executed pivot to SaaS model and signed marquee
roles at public and private companies. clients including Rappi and Go-Jek
• Chartered Accountant • Strong sales and transactional experience
• Experienced active tech investor, Co-founder of MC
Mark McConnell| NON-EXECUTIVE DIRECTOR
Management (venture capital firm)
• Co-founded ASX-listed Citadel Group (ASX: • Bachelor of Commerce (1st class honours in finance)
CGL) in 2007, a leading software and
technology company that specialises in Luke Taylor | CO-FOUNDER & COO
secure enterprise information management. • Involved across the Company from global
• Currently NED of CGL, NED of Viva Leisure operations to overall technology strategy
Limited (ASX: VVA) and advisor to HOF • 20+ years of experience in building and
Capital, a global technology investment firm growing technology businesses
Renaud Besnard | NON-EXECUTIVE DIRECTOR
Fiona Muir | CFO
• Senior Director, Global Marketing, @Twitter
• Former director of APAC Marketing at Uber • Experience in corporate transactions with
and a former Google executive prior roles at ASX listed companies
• Brings a global network through past and • Chartered accountant with 15+ years global
current roles on strategy in order to assist experience in South Africa, UK and Australia
the global commercialisation of TrafficGuard®
• Bachelor of Commerce, Masters in Dave Cox | REGIONAL MD APAC (SALES)
International Business, MBA from Oxford • Extensive international experience in sales
University (UK) leadership and product commercialisation
• Prior senior sales leadership roles with large
Andrew Stott| NON-EXECUTIVE DIRECTOR
global digital advertisers
• Previously Asia Managing Partner and
regional head of corporate of a global law
firm, advising >$20bn in transactions. Further Research Resources
• Significant experience in global tech M&A for 1. http://adveritas.com.au/
listed and unlisted companies. 2. https://au.linkedin.com/company/adveritas-hq

• Was until June 2018 a Board member of the 3. Future Digital Advertising – AI, Ad Fraud & Ad Blocking 2019-23 (Juniper
Research)
Asia Video Industry Association (AVIA), an 4. https://www.youtube.com/watch?v=qABaKfGOaJk&feature=youtu.be
industry lobbying association representing 5. https://itunes.apple.com/au/podcast/asx-company-deep-dive/id1450368565?mt=2
the video industry in Asia, with 130-member 6. https://partnerize.com/en
7. https://www.hasoffers.com/about/
organisations including leading advertising
8. www.rappi.com
& marketing agencies and media groups. 9. www.go-jek.com

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BLETCHLEY Park
Capital
Level 5, 1 Collins St, investors@bletchleyparkcapital.com.au
Melbourne, VIC 3000