Silver Bullet Data Services Group solid foundations and great traction (LON:SBDS)

Silver Bullet Data Services Group

Silver Bullet Data Services Group plc (LON:SBDS) Chief Executive Officer Ian James caught up with DirectorsTalk to discuss a solid set of results, their two divisions, the incredible list of clients, strategic partnership with Making Science and what we can expect from the company in the remainder of the year & into 2023.

Q1: Ian, it looks like a solid set of results for the half year. Could you talk us through the highlights please?

A1: I think solid is a great way to describe it. The big highlights are we’re pleased to report revenue growth up by 40% compared to first half of ‘21 and we’re in line with management expectations in that regard so we’re pleased with that.

That’s really underpinned by big highlights, as you know, we’re a services business on one hand and we have our product business 4D on the other, both business have contributed well into that growth, I’m pleased to say.

Really on the services side, we’ve won 12 new multi-market clients, which include Mars, which obviously is recognisable to everybody and BritBox if you’re a TV viewer and Entain Group, which a betting company. Those are three good examples of multinational clients that we’ve won during this period. That’s on top of consolidating our strong position with current clients such as Heineken, ITV and Channel 4, where we’ve extended contracts both geographically and with different scopes of work with those clients too. So, we’re really pleased with our services growth with over 12 client wins and consolidation of current base.

On our product side, the highlights are really around 4D. We’ve continued to develop the product and enhance the offering, which is a privacy first contextual insights and targeting tool, that’s what 4D does, which is very much in vogue in terms of the drive of our customers towards privacy first advertising. That technical development continues but I’m also pleased to report that we’ve got some good traction now with a large number of clients and agencies who are buying the product. Again, our expectations in terms of revenue have been met in the first half.

So, those are the real highlights from an operational standpoint, and also during the period we shored up our balance sheet by raising additional £4.6 million, which gives us, uh, confidence in our ability to continue to invest in the 4D product and drive forward with our already positive contribution services business as a positive contribution to the group. So, yes, a solid set of results, as you said.

Q2: You’ve mentioned this, but the company is split into two distinct divisions. Could you just tell us what each division does and for who it does that for?

A2: We founded about six years ago and really the basis of that was around what we call our data driven transformation services business. What that does really is it’s our expert services group that help clients to deliver data privacy first and consumer marketing so effectively we help big brands like Heineken, Mars, ITV and over 30 others to really get to grips with:

  1. what is the data strategy they need to pursue to meet their business goals from a marketing standpoint,
  2. ii) to find and employ new technology and techniques and capabilities around data. For example, we work closely with Salesforce ‘Marketing Cloud’ so we would help clients like Heineken and Mars and ITV to deploy Salesforce Marketing Cloud. That would be one example of the kind of work that we would do in that second bucket of implementation services, we describe it.
  3. we help those clients to manage all of the complexities around data for marketing as a managed service consulting business, which gives us retainers with those clients for long term contracts.

So, we really operate our service business and in those three key areas.

The second part of our business or the other side of our business is a product business called 4D, and 4D was really born from lots of conversations with our clients on the services side, who were concerned that the advertising technology that they were using was no longer compliant in a world where GDPR and other such legislation was coming into force. They were asking us to really look at how we could develop a product that could help them to take their privacy first approach into the advertising technology market. So, we launched a business called 4D.

4D is a business that uses contextual data enhanced by other data sets to get better insights and targeting for our clients advertising dollars. We work predominantly with media agencies to deploy that product, they are our customer but big global brands are now using 4D to get better insights and targeting for their advertising in predominantly video digital advertising across platforms like YouTube and other programmatic video platforms.

So, that’s the two sides of the business.

Q3: You’ve got an incredible list of clients with the likes of Mars and ITV, Heineken, and Channel 4. Why do they choose to work with Silver Bullet Data Services?

A3: First thing I’d say, we have a deep track record in first party data and understanding the role that first party data will play in their organisation so there’s no substitute for experience and talent.

I’m pleased to say that in Silver Bullet, we have over 70 plus professionals who all come from either technology, data or big marketing services, client and agency backgrounds. So, we’ve got a solid base of talent that also gives us a platform to be confident that we can build out new products like 4D that meet new market needs and enter white space so giving us good return for shareholders in terms of the potential revenue and business growth.

Fundamentally, why clients work with us is because we have deep experience in understanding the role of data for generating better return on investment for marketing. That’s a complex space. They work with us because we’re respected by the technology that they want to deploy, for an example, we have a deep partnership with Salesforce Marketing Cloud as I mentioned before, we also work with a company called Treasure Data very closely, another strategic partnership, they’re owned by SoftBank so  big backing on big tech investments.

Those companies trust Silver Bullet to work with their blue chip client base like Heineken and Mars, and ITV, they take us into those kind of deals because we are a trusted pair of hands to deliver on services.

On the product side, of course, we’re able to see things that others can’t by working very closely with those multinational clients, in order to develop products that are very, very appealing to the market and meet the future proofing of being privacy first in terms of advertising, insights and targeting as I described earlier.

So, it’s that deep experience really in a nutshell.

Q4: You mentioned strategic partnerships, you’ve just launched a new one with Making Science Group. Can you tell us who they are and what it means for the company?

A4: Making Science are a recognised Google reseller, that’s an important status to hold in the world that we operate, Google obviously are a significant player in the whole ecosystem that underpins the flow of data around any marketing really, whether that’s on mobile devices with Android or whether it’s in AdTech with companies like YouTube and of course search and all of the other data components that go around that area.

So, Google is a big part of our ecosystem, so it’s important to us to stay very close to Google, and a way that Google like to do that is by companies like ours working with their reseller partners and Making Science is one of those. That gives us better access to Google platforms, as described YouTube, 4D our product is available on YouTube and it’s available on Google’s AdTech product called DV360.

Also on our services side, clients are interested in using Google Cloud, which again is a big competitor to Amazon Web Services, for example.

So, on both sides of our business, the joint venture with Making Science enables us to offer better access to Google for our clients, and also gives us a new channel to market for 4D and our services business to Making Science clients and of course potential Google clients in the future.

Q5: Finally, what can investors expect from Silver Bullet Data Services in the remainder of the year and perhaps going into 2023?

A5: We remain confident about where we are, we’ve had a really solid start to the year, we’ve got good visibility on revenues for the rest of ’22 and we feel confident in our plan so that’s the first message.

I think the second one though is that no one is immune from some of the macro turbulence that’s happening across the globe right now. We are a global business working with global brands so clearly macroeconomics will potentially have an impact on our business. We remain optimistic about that given the sense that we are very much in the digital and data transformation space and even in recessionary environments, we found in the past that investment actually can flow further into those transformation projects, not away from them when times become tough. So even if we have downward pressures on marketing investments, we feel confident that we can deliver our plan.

2023 is a whole new world so we’ll see but again, we remain confident that 4D and our services business have got really solid foundations and great traction that should give us confidence for the future.

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