Just got home from work and having a proper read of this document. I dont particularly think there is much new information in this document that was not released in the quarterlies already. The ARPU is now defined, which is new. I personally had predicted around $1 ARPU per month also. Thankfully, the margins are better.
Given the rapid growth in user numbers in the last few months, it really shows the potential of this business to grow in a short period. All they need to do is replicate the same strategy employed with their other partners, and we could see user numbers accelerate further. This line from the announcement is quite promising. "Dropsuite’s team is bullish on continuing to grow the sales pipeline and expects to launch several key partnerships in the second half of 2018". Generally, from looking at past announcements, when they comment on possible partnerships, they are generally already in negotiation with the partners, and soon update the market with a confirmation of the partnerships. So hopefully we'll hear something soon about these.
It is also promising that churn remains lower than expected. Putting some figures out there, we have grown roughly 300k users in the last 3 months. Even if churn is sitting at 20% of our new customers, we would still be sitting at 540k remaining customers. At $1 per month ARPU, this is over $6mil forward looking revenue. We must be cash flow positive any moment now.
The update in the next few weeks will hopefully clarify user numbers, and perhaps if we are cash flow positive now or soon to be.
DSE Price at posting:
12.0¢ Sentiment: Buy Disclosure: Held
