GetBusy PLC (LON:GETB) Chief Executive Officer Daniel Rabie caught up with DirectorsTalk for an exclusive interview to discuss their half-year report.
Q1: Daniel, could you remind our listeners what you do?
A1: We provide document management solutions to predominantly accounting firms but lots of professional service firms. Effectively, what we do is streamline firm’s ability to deal with documents, so we enable them to search, file, store, share their documents in a sophisticated intelligent way, streamlining a lot of their existing operations.
Q2: You’ve just announced your first-half results, what have been the highlights of the H1?
A2: We’re really proud of what we’ve achieved in the H1 results.
For us, a key focus is growing our recurring revenue line and we achieved 23% growth in the constant currency basis in our recurring revenue., that growth was made up of high growth across all three of our regions.
So, the UK was probably our strongest performer where it jumped from what we felt was underperforming last year 5% to 16% recurring revenue growth this half. The US grew at 26% on a constant currency basis and Australia at 45%.
So, all our regions grew well, our top-level recurring revenue grew well and underpinning that is now a mature and scalable customer acquisition model. So, our intention is, on the back of these strong results, is to continue to invest in our growth initiatives to accelerate growth into the future and I think the underlying data of really positive LTV CAC ratio in SmartVault of 5:1 underpins it, that’s an opportunity for us. Beyond that, the results weren’t just strong on the top level, that also flowed down to the lower level results.
So, for us, if we remove development and corporate costs which is essentially just the listing costs of last year, we increased our EBITDA line at 33% so for us, we’re scaling the organisation and moving towards profitability as well as investing in growth. We think we can achieve greater short-term growth by doing what we’re doing, just more of it and better and then ultimately, we’ve clearly identified some longer-term growth strategies which we feel as if we’ve got enough money in the bank, £2.4 million, to underpin future growth activities.
Q3: You talked about the transition in the business model in the UK., what does it mean and why are you doing it?
A3: So, as I said, our core focus is growing our recurring revenue line. Traditionally, we sold our software in an upfront model and with a subscription which was a lower average revenue per user, what we’re trying to do is evolve that into a true subscription model where we don’t charge upfront and we just charge the customer on an ongoing annual/monthly basis. The advantage of that is that the lifetime value of these customers are going to be higher for us and that’s proven by low churn rate that we’ve got so, for us, this model is about investing in the future and having greater lifetime value. The implications is that short-term, it’s going to affect our cash flow, but we will see that cash come back over the period of the contract of the client.
Q4: So, what will the focus be in H2?
A4: As I said, I think for us it’s about additional investment in what we’re doing and doing more of that. For us, a regulatory or compliance changes, it’s favourable and clearly PR was a clear growth driver for us in the first half of the year, I think there’s still longtail results we can get out of that, so it’ll be continued to try and capitalise on that.
With the changes in the inappropriate way a lot of larger companies for example, Facebook are doing data, we’re seeing a lot of regulatory requirements coming into the market so there’s the privacy and security laws which are coming into Australia and we hope to capitalise on that.
Beyond that we’re looking at what is bringing SmartVault, which is our cloud-based document management software which is predominantly sold out of the US, we’re looking at bringing that into the UK, Australia and New Zealand. So, we’ve already got existing infrastructure set up in those locations, we’ve got really capable teams who understand document management and understand the markets we’re going to sell into.
Beyond that, we’ve got 836,000 customers that use our digital signatures across our two platforms, we don’t monetise the SmartVault component of those digital signatures so Virtual Cabinet is bundled into the portal which we sell our customers but SmartVault is an add-on that they buy separately. So, we just announced the partnership with DocuSign, that revenue was immaterial in the first half and we’re hope it becomes material in years to come.
Beyond that, we hit over 1 million portal users this half and that’s obviously a big milestone for us and that talks to greater adoption of our application and the low churn rate, it also talks to a big unmonetized potential. So, we’re building our new application ‘GetBusy’ and for us GetBusy is a logical complementary product to our existing products where hopefully we can add additional average sale prices and additional value into our existing clients. Beyond that, it hopefully enables us to monetise those portal users and a greater addressable market.
So, for us, we’ve got lots of clear growth strategies that we’re looking to execute effectively over the next period of time.
Q5: Finally, you have mentioned a little bit about this but what’s the situation with the new product, GetBusy?
A5: As I said, GetBusy for us is really exciting to add additional value to existing clients and we feel that we can sell it through our existing channels. Beyond that, I think we’ve learned, through customer behaviour, that the problems that we want to solve for our existing clients are not just problems at accountants and their clients have its problems that multiple industries have.
So, what we’re trying to do is build a product which supports client communication, workflow and document sharing in a simple and more intelligent way that will hopefully solve really practical workflow problems for multiple industries including our own that we sell into today.
So, we’re at that really exciting phase with GetBusy where we’re moving into the customer validation stage, we’re start to build out our go-to-market model, we’re going to start to build out our commercial model supporting the go-to-market and the customer validation. So, for me, we’re in that really exciting phase where we’re starting to see light at the end of the tunnel when we can actually start to monetise this product.