Datagate Investor Update – May 2020

Datagate Innovation
Investor Update
May 2020
Mark Loveys, CEO
Commercial and in Confidence –do not distribute

Executive Summary
DearInvestors,
Firstly,thankyouforyourongoingsupportofDatagate.Ithinkyouwillbepleased
withtheprogressthatDatagatehasmadeduringourmostrecentfinancialyear
endingMarch31st,2020,duringwhichwebeganoperatinglocallyinNorth
America.
$1MARRtargetachieved.Internationalgrowthcontinuestoaccelerate
ARR(AnnualizedRecurringRevenue)hasincreasedby133%overtheyearand
similarlywe’vemorethandoubledournumberofsignedcustomers.Asyouwill
seeinthenumbersandgraphsofthefollowingpages,wehavedonemorenew
businessinthelastyearthanthetotalofallDatagate’sprecedingyears
combined.
Covid-19Impact
MarketdemandforDatagatehasnotsloweddownsincetheCovid-19
outbreak.Ourclientsareparticularlybusysupplyingadvancedunified
communicationssystemsandremoteworkingsolutionstotheircustomers,tohelp
themkeeptheirbusinessesoperationalatthisdifficulttime.DemandforDatagate
remainsstrong.OurbiggestmontheverwasApril2020.
AmericanPartnershipsWorkingWell
Datagate’ssuccessisbuiltonourpartnershipsandourabilitytoworkwellin
partnerecosystems.
ConnectWiseremainsourcornerstonepartnership.90%ofourcustomersalsouse
ConnectWise.
SkySwitchisaFlorida-basedwhitelabelwholesaletelecomproviderthatwe
signedupasaresellerofDatagateinJanuarythisyear.Sofar,theyhavesigned
up22Datagatedeals.
OurfiveUStelecomtax&compliancepartnerships,(includingWolters
Kluwer/CCHSureTax)continuetoworkwell,wherewereceiveaconstantstream
ofsalesintroductionsandwealsoreferdealstothem.
Datagate Investor Update -CONFIDENTIAL2
ConnectBoosterisapopularandsuccessfulpayment-portalsolutionthatmanyof
ourAmericanclientsuse,sowerecentlysignedapartnershipwiththemwhere
Datagatewillreceivecommissiononsalesreferralstothem.Wearealsointhe
processofofferingthemareciprocalarrangement.
ProductDevelopment
WecontinuetodeveloptheDatagateproductaggressively,addingnew
functionalityandintegrationstopartnerproducts.Thismakesusmorecompetitive
andopensmorepartnershippotentialandmarketopportunities.
InAprilwereleasedanothermajorupgradetoDatagate,thatmakesourrecurring
billingmoreflexibleandbettersuitedtolargerbusinesses.
GrowthProspects
ThegrowthprospectsforDatagateareexciting.Thepartnershipswehaveinplace
areworkingwell,deliveringongoingsalesopportunitiesatanincreasing
rate.Furthermore,wehavenewpartnershipslinedupforthisyearfromwhichwe
expecttomorethandoubletheopportunity-basewehavenow.Ourgoalisto
morethandoubleourARRagainthisyear.
FutureCapitalRaise
Datagateisclearlyinhigh-growthmodeandit’simportanttokeepourfocuson
growingrevenueandmarket-shareasaggressivelyaspossible.Asdiscussed
duringthelastcapitalraiseprocess,weplanalargercapitalraisethisyearto
accelerateourgrowthPleasestandbyforfutureupdatesonthisinthecoming
months.
ThanksagainforyourongoingsupportofDatagate.Welookforwardtobringing
youthenextupdatewithevenmoregoodnewsonprogress.
Mark Loveys
Chief Executive Officer

✓March annualised recurring revenue (ARR) at $1.1M (NZD) up 133% on last year and 31% in the quarter
✓Signed customers increased from 73 to 95 up 30% with another 10 customers added this April
✓International customers increased from 40 to 70
✓Datagate v2.6 rolled out with significant new capabilities for larger customers
✓Low customer churn maintained (no implemented Datagate customer has cancelled in 2019 or 2020)
✓New signed referral partnership with Connect booster and new reseller partnership with SkySwitch
✓Two new Canadian team members hired, and we're now in the process of hiring another
✓No noticeable impact on demand for Datagate due to Covid-19 situation
✓No staff turn-over
Datagate Investor Update -CONFIDENTIAL3
Highlights of the quarter

Datagate Investor Update -CONFIDENTIAL4
Number of signed customers by geography
0k
10k
20k
30k
40k
50k
60k
70k
80k
90k
100k
Jan-18
Feb-18
Mar-18
Apr-18
May-18
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20
TotalNZUnited StatesAustraliaUnited Kingdom
-
20
40
60
80
100
120
Jan-18
Mar-18
May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
TotalNew ZealandUnited StatesAustraliaUnited Kingdom
Monthly recurring revenue (MRR) by geography
MRR ($NZD)
Datagate Group –Recurring Revenue and Customer Count

Datagate Investor Update -CONFIDENTIAL5
Datagate Group Cash Movement and Cash BalanceTotal Revenue and Earnings Before Interest, Tax, Depreciation, Amortisation
Datagate Group –Profit and Loss and Cash
(150k)
(100k)
(50k)
0k
50k
100k
150k
Total RevenueEBITDA
(83k)
(136k)
(88k)
(57k)
(86k)
(109k)
(64k)
(92k)
(69k)
(112k)
(78k)
(59k)
(200k)
0k
200k
400k
600k
800k
1,000k
1,200k
MovementBalance
$NZD$NZD