The delay between reported ACV & cash receipts has obviously been discussed a lot on the 3DP threads, and it has clearly divided shareholders on this thread
It is a fairly complex issue, and as mentioned there is definitely a certain amount of trust in management involved.
This has been mentioned before (so apologise in advance for rehashing this), but the main issues in the approximately "18 month lag" between the signing of the contract (when the ACV is calculated / announced) and the actual cash receipts reaching this level of ACV are:
1. The time it takes to onboard the company's data onto the Pointerra platform. Sometimes the "new client / company" already has the data, and sometimes the company is still collecting the data (which significantly lengthens the onboarding process as 3DP have to actually wait for this data collection process to take place first).
And once Pointerra actually have the data, they then need to onboard it - so as Ian mentioned today in the interview, this onboarding process often takes months (and it has taken nearly a year with one US utility company)
3DP obviously can't invoice until they have onboarded the data for the new client - hence this onboarding process can cause significant & unexpected delays for invoicing & revenues & cash receipts.
2. And then Pointerra apparently have a few different payment cycles for many of their clients (eg monthly, quarterly, yearly etc), and this can also make the quarterly cashflow reports "lumpy".
3. And then finally some of the big US utility companies are notoriously very slow in making payments, and as others have mentioned, it is sometimes hard to "go to war" with your largest clients over an outstanding payment.
The lag between reported ACV and cash receipts is too long, and clearly all shareholders want this "lag period" to shorten.
But it does give us a great indication of future cash flows & revenues.
From Ian's interview today, I definitely took encouragement from the discussion about the new contracts, "that there was lots of pending invoices & deployments", he re-iterated that Q3 & Q4 cashflow would be better, and he also stated "if cashflow is quieter in one quarter, then the next one makes up for it".
