Chief
Executive
Officer
INVESTOR PRESENTATION
October 2015
Craig O’Neill
David Chan
2
Forward Looking Statements
This presenta,on contains “forward-‐looking informa,on” which may include, but is not limited to, statements with
respect to the ac,vi,es, events or developments that the Company expects or an,cipates will or may occur in the
future. Such forward-‐looking informa,on is oBen, but not always, iden,fied by the use of words and phrases such
as “plans,” “expects,” “is expected,” “budget,” “scheduled,” “es,mates,” “forecasts,” “intends,” “an,cipates,” or
“believes” or varia,ons (including nega,ve varia,ons) of such words and phrases, or state that certain ac,ons,
events or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved.
These forward-‐looking statements, and any assump,ons upon which they are based, are made in good faith and
reflect our current judgment regarding the direc,on of our business. Management believes that these assump,ons
are reasonable. Forward-‐looking informa,on involves known and unknown risks, uncertain,es and other factors
which may cause the actual results, performance or achievements of the Company to be materially different from
any future results, performance or achievements expressed or implied by the forward-‐looking informa,on. Such
factors include, among others, risks related to the specula,ve nature of the Company’s business, the Company’s
forma,ve stage of development and the Company’s financial posi,on.
Forward-‐looking statements contained herein are made as of the date of this presenta,on and the Company
disclaims any obliga,on to update any forward-‐looking statements, whether as a result of new informa,on, future
events or results, except as may be required by applicable securi,es laws. There can be no assurance that forward-‐
looking informa,on will prove to be accurate, as actual results and future events could differ materially from those
an,cipated in such statements. Accordingly, readers should not place undue reliance on forward-‐looking
informa,on.
Current State of A/R Management
3
Supplier Creates
Invoice
Sends invoice to
buyer
(Paper or Email)
Buyer routes for
internal
approval
Supplier sends
reminder email
Buyer requests
new invoice
4
Complicated and Costly
§
Frustrated customers
§
Wasted time
§
High bad debt expense
§
Organizational inefficiencies
§
Late Payments
5
Financial technology company delivering integrated
cloud-‐based payment solu,ons for businesses
VersaPay
6
2006
Company Founded
2010
#1
Rank in Profit Top 50 in 2009
IniJal Public Offering
What Versapay Delivers
7
POS Merchant Services
Business SoluJons
§
Reseller of credit card terminals
§
Track record of new account growth
§
Recurring fees generated on
transacJon volumes
§
Long term relaJonships with
customers and technology partners
§
Cash flow posiJve
§
SaaS-‐based electronic invoice and
payment system
§
Designed to streamline accounts
receivable management
§
Product is delivered to end users
through direct sales and partnership
arrangements
Versapay Solutions Products
ARC
-‐ Supplier portal
-‐ Customer portal
Gateway
-‐ Payment Processing Services
-‐ Payment Gateway Services
-‐ Applica,on services (users, logging, etc)
-‐ Creden,al Vault
-‐ No,fica,on Services
PayPort
-‐ UI for individuals /
small businesses to
make and receive
payments
Future apps
-‐ Payment API
-‐ Invoice API (future)
-‐ File import
-‐ Processor connec,vity
-‐ AR connectors
-‐ AP connectors (future)
Admin
Console
-‐ Admin tools
ARC: Accounts Receivable Cloud
9
COMPANY:
§
Publish invoices and
supporting documents
§
Collaborate with customers
§
Track and analyze
customer behavior
§
Auto reconcile and clear
CUSTOMERS:
§
One-click access
§
Convenient and secure
§
Collaborate with you
§
Choice of payment options
ARC Advantage
§
Invoice and collect more efficiently
§
Get paid electronically, get paid faster
§
Reduce costs vs manual or on premise systems
§
Sa,sfy customers desire to pay electronically
§
Make credit cards a cash flow tool
§
Eliminate security issues with customer data
§
Get started quickly and easily
10
The Opportunity
(Selected Verticals)*
11
125,000
U.S. firms with $50M to $1B
in revenue
>$5B
USD
In annual recurring revenue
88%
Percent of U.S. firms rely on
paper invoices
Selected Ver,cal Industries:
•
Media
•
Trucking / Logis,cs
•
Commercial Realty / Property Managers
•
Wholesale / Distributors
•
Manufacturing
•
Professional Services
*
1,582
3,845
1,120
50M-‐100M
100M-‐500M
500M-‐1B
12
A/R Automa*on/Outsourcing
•
BillTrust
•
TransacJs
•
Kubra
•
HighRadius
•
Banks
A/P Automa*on/Outsourcing
•
Oracle
•
SAP
•
Esker
•
Corcentric
•
Ariba
•
Bobomline Technologies
•
Banks
Email-‐based Invoicing
•
Freshbooks
•
Wave
•
Intuit
•
Sage
•
Invoice2go
Procure-‐To-‐Pay
•
Cortex
•
Esker
•
Corcentric
•
Ariba
Ecosystem & Competition
L
ar
g
e
SU
PPL
IER
Sm
all
Small BUYER Large
13
ARC:
Positioned to Grow Rapidly
§
A compelling value
proposi,on
§
A large untapped market
with limited compe,,on
§
Our approach overcomes
historical obstacles
§
Experience in the market has
proven our story is
compelling
§
Addressable market is
es,mated to be at least 5B
§
Limited compe,,on
§
The solu,on, pricing and
implementa,on approach
takes away reasons to say no
14
ARC:
Positioned to Grow Rapidly
§
A compelling value proposi,on
§
A large untapped market with
limited compe,,on
§
Our approach overcomes
historical obstacles
§
Partnerships with major industry
players give us significant market
reach
§
Several trends are leading
towards change
ü
Experience in the market has
proven our story is compelling
ü
Addressable market is es,mated to
be at least 5B
ü
Very limited compe,,on
ü
The solu,on, pricing and
implementa,on approach takes
away reasons to say no
ü
Heartland, TD, Visa, MasterCard,
more on the way
Growth Profile –
The Early Adopter Phase
15
09/13-‐06/14
ARC
Development Phase
07/14-‐04/15
Pilot Phase with
early adopters
05/15-‐12/15
Graduate from early
adopters
2016
-‐
Expand Sales and
Partners to scale-‐up
“First 5”
“5 to 25”
2013
16
Early Adopter Phase Progress
24
12
Suppliers signed
Suppliers live
Excellent Customer Feedback
$~900K
Annual recurring revenue from
current signed customers
$5-‐7M
Annual recurring revenue from
current pipeline
Customers registered
8,500
*
17
Recent Highlights
§
Three banks interested in
reselling ARC
§
ERP vendor agrees to use ARC
and refer customers
§
First unsolicited leads received
§
RFP (from large US
manufacturer)
§
First 1M invoice/month
opportunity
$6,400,000
In paid invoices
24%
Percent of invited end-‐
customers registered
Customer Success Stories
§
Municipal government pays 22 outstanding invoices da,ng
back 6 months. A/P user calls in to say “how much everyone
loves this new system”
§
Buyer pays $68,000 of overdue invoices in response to ARC’s
automa,c 30-‐day overdue reminder
§
Buyer logs in, signs up and pays all outstanding invoices
within 5 minutes of ARC sending invita,on
§
Buyer automa,cally opts-‐in for AutoPay within days of
feature being introduced
§
Agency buyer pays all outstanding invoices with one click
using Pay All feature
19
Revenue Model
Business SoluJons
POS Merchant Services
Monthly
subscripJon fee
Credit card
transacJon fee
Sale of credit
card terminals
Credit card
transacJon fee
>95%
Recurring Revenue
21
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
$100,000
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2013
2014
2015
Profitable
Stable
POS Volumes Continue to Grow
Cr
ed
it
Ca
rd
$ V
al
u
e
(in tho
usands)
22
Revenue:
Growth Expected From Business Solutions
Re
ve
n
u
e
(in tho
usands)
23
Financial Summary
($000
’
s)
Q2
’
15
Q2
’
14
FY
’
14
FY
’
13
Revenue:
$1,407
$1,410 $ 5,165
$ 4,819
Gross Profit
813
876
3,210
3,212
Gross Margin
58%
62%
62%
67%
Adjusted EBITDA
(1,159)
(570)
(2,717)
(670)
Net income (loss)
(1,294)
(706)
(3,556)
(1,110)
24
Corporate Information
Ticker (TSXV)
VPY
Market CapitalizaJon
(09/28/15)
$26.5M
Stock Price
(10/9/15)
$1.04
Shares Outstanding (Basic)
25,500,990
OpJons
3,641,618
Fully Diluted Shares Outstanding
32,994,680
Year End
December 31st
Cash and cash equivalent
(06/30/15)
$5.2M
Management Team
Craig O’Neill – Chief Execu,ve Officer and Director
Craig O'Neill was appointed to the posi,on of Chief Execu,ve Officer at VersaPay Corpora,on in September 2013. He has also been a Director on the company’s board since November 2013. He has more than 20 years of experience delivering enterprise soBware. Prior to joining VersaPay, Craig was the co-‐founder and CEO of Xeye, where he directed the company’s growth of more than 40% per year and sale to Odyssey Financial Technologies, and ul,mately to the Temenos Group, where he became SVP Strategy and Development. His background includes management of large development groups, designing and building founda,onal components of corporate system architectures and applica,ons, overseeing enterprise CRM implementa,ons and driving strategic business ini,a,ves. Craig holds a B.Sc. from the University of Toronto in Computer Science and Mathema,cs.
David C W Chan – Chief Financial Officer and Corporate Secretary
David has served as VersaPay’s CFO and Corporate Secretary since 2011. He has over 24 years of experience working with high growth technology companies. Prior to VersaPay, David was an M&A and corporate finance professional and advised on over 30 transac,ons with a total value of over $1 billion. David has also been an investor and principal in several soBware start-‐ups. He is a Chartered Accountant, and previously worked with Ernst & Yong. David is also a CPA and CFA charterholder and has an MBA from the Schulich School of Business at York University.
John McLeod – Vice President, Marke,ng
John McLeod joined VersaPay in October 2014 responsible for crea,ng and delivering the company’s brand and marke,ng strategy. John was formerly Vice President, Marke,ng at Desire2Learn, a global SaaS based learning solu,ons provider. During his tenure he was instrumental in its growth from 35 employees to a global enterprise of nearly 900 employees serving 13 million learners. John has been a key member of senior management teams driving growth in both start-‐up ventures and large technology companies including MetroNet Communica,ons, AT&T Canada and Allstream. John holds a BBA from Wilfrid Laurier University, an MBA from the Ivey School of Business at Western University and a CMA designa,on.
Geoff Couss – Vice President, Sales
Geoff Couss has over 25 years experience with such notable technology companies as Samsung, Verizon and Hewles-‐Packard. In his role as VP Sales, Enterprise Business, at Samsung Canada he was responsible for managing the sales of mobility and IT related products and services to businesses. Prior to Samsung, Mr. Couss was the VP & General Manager for Canada for Verizon Enterprise Solu,ons. He joined Verizon aBer a long career with Hewles-‐Packard Canada, where he progressed from business unit manager to eventually become VP Sales, Enterprise Services.
Mislav Majic – Vice President, Sales Engineering
Mislav Majic joined VersaPay in October 2011 and is responsible for leading the sales team to deliver on the company’s solu,ons vision. He brings with him 15 years of experience building and leading soBware solu,ons business in the financial services technology sector. Prior to joining VersaPay Mislav was a partner at Facta Vera, a payment automa,on and cash management solu,on provider for enterprise level organiza,ons. In that capacity, Mislav oversaw the vision, strategy and growth from start up onwards, ul,mately serving hundreds of Fortune 1000 customers throughout North America. He has a Bachelor of Business Administra,on degree from Ryerson University.
Management Team
Andrea Peaue – Director, Client Services
Andrea Peaue-‐McWaters joined the VersaPay team in February 2012. As the Director of Client Services, she is commised to making a difference in the lives of VersaPay’s customers, and her coworkers! She leads the support and implementa,on teams as they strive to exceed the expecta,ons of our clients at every opportunity. Before joining VersaPay, Andrea worked at Book4Time, the first cloud based soBware in the health and wellness market. She was instrumental in the company’s growth, building the Client Services department from the ground up while working with interna,onal luxury brand hotels and the world’s most exclusive spas. With over 15 years of service experience, in various management roles, Andrea’s focus is to bring customer service excellence to VersaPay.
Garry Chan – Vice President, Products
Garry Chan joined VersaPay as Vice President, Products in January 2014. He has more than 20 years of experience as a technology entrepreneur and leader. Prior to VersaPay, Garry was founder of goodiest.com, a cloud-‐based technology start-‐up for small business and before that, Managing Partner at Procase Consul,ng Inc., a Toronto-‐based IT professional services company. Garry holds a B.Sc. from the University of Calgary, an MBA from the Rotman School of Management at University of Toronto, and a M.Sc. from Carnegie Mellon University.
Frank Opat – Vice President, SoBware Engineering
Frank Opat joined VersaPay Corpora,on in February 2014 and leads the soBware engineering group. Over the past 15 years, he has brought enterprise scale soBware solu,ons to market globally, as a consultant, product architect, product manager, and entrepreneur. Prior to joining VersaPay, Frank held senior product leadership roles at Temenos through acquisi,ons of Odyssey Financial Technologies & Xeye. He co-‐founded and designed several products servicing the CRM & document management needs of the Canadian mortgage industry. Frank holds a Bachelor of Mathema,cs & Honours Computer Science from the University of Waterloo.
Patrick MacDonald – President, POS Group
Patrick MacDonald joined VersaPay in January 2010 and leads the company’s na,onal POS sales and account management teams as well as the merchant sales support team. Patrick has 18 years of business development experience. Prior to joining VersaPay, he partnered and worked with one of Canada's leading ATM distributors, rapidly becoming the number one distributor across Canada. He served as the Director of Na,onal Sales for a na,onal marke,ng company, where he was instrumental seeing it become one of Canada's largest marke,ng and fulfillment houses.
Kevin Short – Co-‐Founder and Chief Informa,on Officer
Kevin Short co-‐founded VersaPay Corpora,on in 2006 and serves as its Chief Informa,on Officer. Prior to VersaPay Kevin developed the security architecture and oversaw the security design and implementa,on for the Vancouver 2010 Olympics for Bell Canada. Kevin has been involved in designing, securing and implemen,ng banking infrastructure for Canada's leading financial ins,tu,ons for more than 13 years. In his career, Kevin has served in a senior capacity for Sun Microsystems, Nortel Networks, TELUS, Shaw Communica,ons, Bell Canada, Enbridge and TransCanada Pipelines.
