Today’s AGM Agenda
10:40 am
Business Review
10:30 am
Proxy
11:20 am
Q&A
10:00 am
Todays AGM Agenda Q&A Proxy 11:20 am 10:30 am 10:40 am - - PowerPoint PPT Presentation
Todays AGM Agenda Q&A Proxy 11:20 am 10:30 am 10:40 am Business 10:00 am Review Welcome 0 Forward-Looking Statements This presentation contains forward -looking statements or forward -looking information within the
10:40 am
10:30 am
11:20 am
10:00 am
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This presentation contains “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws (collectively, “forward-looking statements”). Forward-looking statements are generally identifiable by use of the words “believes,” “may,” “plans,” “will,” “anticipates,” “intends,” “budgets,” “could,” “estimates,” “expects,” “forecasts,” “projects” and similar expressions, and the negative of such expressions. Forward-looking statements in this presentation include statements about potential acquisition targets; product development and the plans of management; additional product sales opportunities; increased top line revenue; and extending existing product lines through internal development efforts, strategic business relationships as well as focused acquisitions. With respect to the forward-looking statements contained in this presentation, VIQ has made numerous assumptions regarding, among other things, the completion of the Offering; the ability to complete acquisition transactions; and additional product sales and extending existing product lines resulting in increased top line revenues. While VIQ considers these assumptions to be reasonable, these assumptions are inherently subject to significant business, economic, competitive, market and social uncertainties and contingencies. Additionally, there are known and unknown risk factors which could cause VIQ’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements contained herein. Known risk factors include, among others: there can be no assurance that VIQ will be able to complete any relevant acquisitions; there can be no assurance that the Company will not require additional financing, as well as the uncertainty as to the terms and to the availability of future financing; there can be no assurances that the Company can increase or maintain current top line revenue; there can be no assurances that the Company will achieve additional product sales; and there can be no assurances the Company can extend existing product lines through internal development efforts, strategic business relationships and focused acquisitions. A more complete discussion of the risks and uncertainties facing VIQ appears in VIQ’s most recently filed Annual Information Form, Annual MD&A, and other continuous disclosure filings which are available on SEDAR at www.sedar.com. VIQ disclaims any
forward-looking statements contained herein to reflect future results, events or developments, except as required by law.
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2018 2017 2016 1 yr. % Change 2 yr. % Change Total Revenue 11,463 11,730 8,626
+33% Recurring 10,101 9,145 7,422 +10% +36% Non-Recurring 1,362 2,585 1,204
+13% EBITDA (2,372) (552) (621)
Gross Margin 3,589 4,624 3,477
+3%
Financials USD
2019 2018 2017 1 yr. % Change 2 yr. % Change Total Revenue 6,359 3,006 2,885 +112% +120% Recurring 5,489 2,264 2,126 +142% +159% Non-Recurring 869 742 759 +17% +14% EBITDA 298 (12) 142 +2583% +110% Gross Margin 3,037 1,192 1,238 +155% +145%
Selected Q1 2019 Results USD
(Audited, in 000s) (Unaudited, in 000s)
Start of VIQ 3.0 2019- End of VIQ 2.0 2018-2018
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▪ VIQ is the global market leader in the capture, management and mining of sensitive digital evidence information ▪ Driving digital transformation within the highly compliant, security-focused and regulated public and private sector markets that we serve ▪ Diversified international company with customers, operations and partners distributed throughout the USA (60% by revenue), Australia (25%), EMEA (10%) and Canada (5%) ▪ First (and only) to bring artificial intelligence (AI) into end-to-end customer workflow across the entire capture and transcription value chain to our target market
Business Overview Company Highlights
~$25 million USD 2018 pro forma revenue* and >100% annual growth Global customer base with over 1,200 customers in over 25 countries Captures 400M minutes of audio and video through proprietary multi-channel, multi-speaker software Transforms 30M minutes of recordings a year to documents, forms and transcripts $8.5 billion Total Addressable Market (mostly non-security compliance) Rolling up the industry: 3 industry-leading companies acquired; others under review
* Pro forma revenue reflects full-year impact of 2018 acquisitions.
80% AI to Humans Collaboration 2021 80% SaaS Margins
VIQ’s AI Transcriptionists Collaborative Platform
0% AI to Humans Collaboration 2019 40% Services Margins
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Evidence
(1) Recording and Transcribing
Proprietary Software Products Machine to Humans Collaboration
(3) Machine Learning Applied (4) AI Simplifies Complex Analytics, Big Data (2) Creates Knowledge Graph
6 Nodes 100 Nodes
(1) (2) (3) (4)
Wide Range of Recording Devices
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North America EMEA Australia Law Enforcement
40% of client base
Judicial & Legal
35% of client base
Top 16 International Clients
1 U.S. Government 2 U.S. Insurance, Fortune 500 3 U.S. Insurance, Fortune 500 4 U.K. Government 5 Canadian Government 6 Law Enforcement Australia 7 U.S. Police 8 Police Australia 9 U.S. Courts 10 U.S. Insurance, Fortune 500 11 U.S. Insurance 12 Canadian Government 13 Scottish Government 14 Australia Lawyers 15 U.S. Police 16 U.S. Bankruptcy Courts
Insurance
25% of client base
Segmentation of client base
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Growing to $10.6 Billion in 2021: Explosion of highly regulated evidentiary content
Industry Vertical # of Audio Recordable Events Average Length Per Recording # of Transcribed Pages Per Year # of Agencies U.S. Total Addressable Market Law Enforcement
Interrogation, narratives, statements 31M 27 mins. 769M 17,985 Agencies 689,100 Officers Insurance Interviews, witness statements, claims 26M 12 mins. 646M 6,000 Companies Judicial Court reporting 4M 4 hours 923M 44,000 Courts Legal Lawyers’ case notes 150M 10 mins. 1.5B 47,562 Law Firms
Total U.S. Market >200 Million Recordings Average 72 Minutes per Recording >3.8 Billion Pages >100,000 Customers in Market
Source: Calculations based on IBIS World, The Insurance Information Institute and management estimates. $2.4B $2.1B $3.0B $1.0B $8.5B
Law Enforcement Insurance Judicial Legal Total
Growing to $10.6B in 2021
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Capture Manage Mine
Mobile app Capture multiple multi-channel sources in a single platform Dictation Platform
$0.80 VIQ Core Products $0.20 Add-ons
CyberCrypt
Ultra-secure Compliance
Cloud Hybrid Storage NetScribe Connect
Per incremental dollar of new business…
Cloud-based Transcription Workflow Collaboration Portal AI Analytics Engine
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Drive Financial Performance Cross-Sell End-to-End Solution Set Advance Technology Innovation Continue Accretive Acquisitions
▪ Drive quality and quantity of revenues toward recurring aiAssist revenue model ▪ Transition from 100% manual workflow to 80% AI Collaboration by end of 2021 ▪ Improve margins to drive business value ▪ Single source for customers’ full capture, management, mining and transformation needs related to digital content ▪ VIQ’s proprietary software & best-of-breed from Joint Ventures ▪ Safely capture and convert large volumes of audio and visual content into next generation of documentation and information ▪ Deliver a hybrid AI and human workflow platform where humans perform QA and improve machine results via machine training roles ▪ Deliver better results via market- and customer-specific vocabulary and custom language models ▪ Integrate next level of AI services for Automated Actions via knowledge graph, machine learning and complex analytics ▪ Close and integrate strategic & accretive acquisitions, continuing to grow and drive market share and consolidation efficiencies ▪ Engage selected partnerships and JV opportunities for collaboration, innovation and marketing relationships to accelerate growth and expand global presence
Highly curated and actionable M&A pipeline
Capture Manage Mine
PRICE COST OVERALL MARGIN
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Estimated Revenue Market Multiples
5.0x- 10.0x 3.0x- 5.0x 1.5x- 3.0x 1.0x- 1.5x
One-Time and Licensing Transcription Services Recurring SaaS AI
Increasing Margin VIQ 1.0 VIQ 2.0 VIQ 3.0
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>$20M >$50M >$100M Implied Enterprise Value(2) >$200M Revenue 2018 2019E(1) 2020E 2021E By Revenue Type One-time and Licensing $0.9 8% $1.8 7% 0% 0% Recurring Transcription Services 8.5 74% 17.1 62% <60% <50% Recurring SaaS Revenue 2.1 18% 5.9 31% AI Revenue 0.0 2.7 Total $11.5 100% $27.5 100% 40% 50%
(in millions USD)
> >
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2.4x 2.3x 4.8x 10.5x 8.8x 2.9x 13.7x 13.2x 4.2x 7.8x 0.6x 7.1x
Transcription Businesses
Average: 2.4x
Industry Vertical Service Providers
Average: 8.1x
AI-Enabled Business Services
Average: 8.4x Overall Average: 7.1x
Current VIQ Market Cap: $15 million USD Implied VIQ Market Cap²: $173 million USD
Equity Value / LTM Revenue¹
Current Implied
(1) Assumes VIQ shares outstanding of 188,022,523, using CAD/USD exchange rate of $0.75 and stock prices as of close June 7, 2019. (2) Based on average market multiple for comparable companies.
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2H
IR PR 1H IR PR
Brokers/Retail)
research
inbound inquiries
metrics, business updates, customer case studies
financial and local media
cyber security focus
communications materials
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Top tier coverage secured in AiThority and CFO Magazine
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AI tools have been proven to augment human processing by automating labor intensive processes that lead to greater
capabilities by acting on new knowledge created by AI tools. The future of AI will include knowledge graphs where things, places, descriptions, events, and people referenced in evidentiary data will be made available and analyzed to search for associations, more relevant facts and correlations between transcripts and evidence.