Novatti - "aha" moments!

I wanted to write some down just some of the research I have done to get a better picture of my thoughts on Novatti. I have decided to share my personal opinions to get the thoughts and opinions of others.

None of this is financial advice nor has any of this been confirmed by Novatti. Do your own research and fact check everything for yourself.

An important factor when assessing a company is the competency of its employees. There doesn’t seem to be much discussion of this in relation to any company. Possibly too time consuming or people don't realize the importance.

The way I look at it is, behind all these businesses is human beings that drive the company to either success or failure.

I’m going to start by shedding shed light on a handful of employees at Novatti. (There are many more worthy of mention)

Craig Glendenning - Chief tech officer for Novatti's banking division. Craig is the inventor of BPAY and was responsible for the development of Visa’s PayWave, take a moment to reflect on what kind of person invents Bpay and payWave and how valuable that individual is. It doesn't get much better than this in Australia in regards to innovation and payments. He is an Elite software architect and technology specialist that’s good enough for the likes of Apple. Here is a list of some of Craig’s recent patents, these relate to “Bluechain” a company co-founded by Craig and some of his previous workings. The tech behind Blue chain is really quite advanced and these patents show what Craig is capable of.
https://patents.justia.com/inventor/craig-glendenning

Also note these are not just patents, these are innovations we all use!

Bear with me while we dive down this path a little bit further.
The last patent from the above link (Publication number: 20070118483), lists seven other names alongside Craig. One of those names is Anita Ochieano. If you look into Anita’s patents,
https://patents.justia.com/inventor/anita-ochieano you will find 5 patents, each with Craig Glendenning as a co-inventor. The interesting part is VISA is the assignee. This means visa has ownership interest in the legal rights the patents offer. To put it simply Visa has handpicked these individuals to invent this tech and Craig has been part of the team since the early 2000’s

This got me thinking about a bunch ofquestions:

Why is one of visa’s top inventors also novatti’s chief technology officer?

Why does Afterpay choose novatti for its visa issuing.

Why does square buy Afterpay

Why does Marqeta partner with novatti

Why was Visa a seed investor of Square and Marqeta

With further research into these questions I have come to opinion that Visa is the artist to the landscape of payments and Novatti is one of its finer brushes used in the part of the masterpiece that holds the Asia Pacific Region.

Guy carvalho the man leading novatti’s banking division. Guy was an ANZ exec and Head of Business & Payments Services at Australia post. Around the same time Guy joined Novatti there was a number of Securepay employees that also joined Novatti. I speculate guy’s influence is one of the reason Novatti was able to obtain a portion of key personal that built Australia posts payment system, SecurePay. Same group of geniuses that built Novatti’s crypto patent and built Novatti’s acquiring/online payments gateways and other technologies.

Crypto patent
http://pericles.ipaustralia.gov.au/ols/auspat/applicationDetails.do?applicationNo=2021900385

Noteworthy personnel:
Kian Jackson - General Manager (Previously General Manager SecurePay) led a 110 people at Secure pay which was processing 1m transactions per day worth 75bn.
Prasan Fernando - Head of Technology Acquiring at Novatti Group (Previously Head of Technology SecurePay)
Nalaka Gooneratne - Software Engineer Manager Acquiring at Novatti Group (Previously Software Engineering Manager SecurePay)
George Abraham - Chief Information Security Officer (CISO) at Novatti Group (Previous Head of Risk SecurePay)

Rhys D'Souza - Head of Risk Acquiring at Novatti Group (Previous Compliance Lead SecurePay)

These are incredibly talented individuals. This is not something that you read in a quarterly report nor something that is factored into the market cap.

A great idea, the right time and luck aren’t enough to ensure success. What’s needed is the right people, the right networks and the ability to execute, all of which I believe Novatti has.

Enett
Founded and still ran by Melbourne’s “Anthony Hynes”. The company is a highly successful global provider of payments solutions focused on the travel industry. Enett was bought by Wex a 7B dollar US IT company in 2020. Enett and Novatti have close synergies and what’s interesting about this is, Daniel Adams played a key role in Enett as Global Head of Delivery, assisting the company in growing its revenue 63% year-over-year to 315m USD in 2018. As of September 2021 Daniel, joined the ranks at novatti as head of transformation, along with Craig Hynes. Brother to Enett CEO Anthony Hynes.

Two key players in Enett’s success, one of them being the brother of Enett’s CEO are now a part of novatti. I think this industry connection is one worth noting and I see this as a seed to some form of alliance between Enett (wex) and novatti.

Visa
Looking at the connections Between Marqueta, Square and visa. Visa has a large stake in both Marqeta and Square and is a strategic partner to both. Square bought Afterpay and seeing as Novatti is a partner of Visa I speculate Visa actually assisted Novatti in the Afterpay deal. How else was Novatti able to grab them as a customer, if true this shows how much support and trust visa has in Novatti. Visa is one of the leaders in payments and they are in Novatti’s corner.

Visa is totally committed to growing their slice of the global payment’s monopoly and in order for that to happen alliances need to made. Smaller organisations need to make money along the way to sustain and grow visa’s network. In order to succeed in this space companies, need to work together.

To illustrate this point here’s an example: Mark Zuckerberg has recently given more insight into the metaverse and its goals. Part of the plan is to ensure that outside creators and third-party businesses have the opportunity to make a good living from the metaverse, that includes working in the metaverse or helping to build it. The metaverse business model actually revolves around third party businesses or individuals being able to contribute and quote “earn a living”. The reason is any business as large as Meta or Visa has to create financial opportunities for others that are outside of the organisation, otherwise these global networks would never take hold. Novatti’s success is in line with Visa’s goals and Visa has shown tremendous support.

It probably won’t come to much surprise that Visa and Wex have a partnership however Wex is a direct competitor to Marqeta.
Visa and Wex form alliance 2018
https://www.businesswire.com/news/home/20180724005130/en/Visa-and-WEX-Team-Up-to-Offer-Choice-and-Versatility-to-Commercial-Payments-Customers

This is just an artistic representation to illustrate how I visualize the payment companies written about in this comment. It would be interesting to see if anyone has come to a similar conclusion.





If you’re really into payments, watch this video with the developers from Visa, Marqeta and Square discuss changes that are coming in the payment space.

https://www.youtube.com/watch?v=Zmqb8kE21io

Regal

You can’t deny the fact regal are a nuisance, they have been raided. One of their top analysts has been banned from trading for manipulating Clearview. Now as much as despise them for the trading tactics they have been accused of, at the end of the day they coughed up 40m for novatti’s growth. Regal was an early investor in Novonix with an avg price of somewhere around 0.60, once they got in, it was bumpy and suppressed throughout 2020. NVX has just breached $8. Regal will supposedly short and use tactics to accumulate whether true or not they cannot hold down a good company forever and that is exactly what novatti is. A good company with a very experienced, well connected and methodical team.

Bank Licence
Without the bank licence they are still a growing payments company with a fortified foundation and multiple revenue streams. In my opinion we are going to see record breaking revenue next quarter, according the latest webinar we should see two dividend payments from reckon and further revenue from ATX added to the balance sheet. Now speculating I predict an increase in core business sales as everything has opened back up, spending is on the rise and the addition of new employees.

With the bank licence, well look at what judo did in 24 months, we have the right people to replicate if not beat Judo. Judo started with no customers. NOV already has their customer base & they also have access to RKN customer base. I believe Peter is anticipating the end of November for the bank licence and he has stated Novatti should obtain the full ADI in 6-9 months after the Radi is granted. The question “What are the chances of Novatti not receiving the licence” was asked in the presentation. Peter replied something along the lines of “I am 99% sure it will be granted and it is in the very final stage”

In my opinion Novatti has the goods and is going to play a role in integrating Australia into the global digital payment arena and as this becomes clearer to more and more investors, it will not matter what regal does.

Reckon
If your confused about the reckon stake, in my opinion it was an excellent move by Novatti. Peter has already said in the presentation they are in negotiations with reckon and discussing how their payment gateway will be integrated into Reckon’s software giving Novatti access to over 100,000 SME’s. Novatti doesn’t invest 22 million for a dividend. I trust they know what they are doing with the money. Novatti enables businesses to pay and be paid as well as launching a bank. They have spent the whole year employing personnel and as explained have some extremely talented people on board. I trust that these people know what they are doing. Visa the one of biggest payments company in the world, Afterpay one of the biggest BNPL’s trust Novatti, why shouldn’t ..?

Things that jump out at me.
100 odd million-dollar market cap with:
Tier 1 partnerships
Tier 1 backing
Tier 1 employees
Launching bank
Further Integration both Visa and Mastercard underway
Tentacles in crypto (Ripple/Stella partnerships)
Growing core payment processing business.
Half a dozen revenue generating subsidiaries.
Covid easing.
Globalisation not going away.
Employees in:
Serbia
China
Cyprus
London
Greece
Tunisia
Malaysia
USA

I have done similar dives into IOU,SMP, DOU, CRO, FFG,EML,TYR etc. Novatti isthe company I choose to back.

Risks:
WW3, Financial crash? I think risks are opinion based depending on informationsomeone has. It’s difficult to speculate on risks with the limited knowledgeinvestors have. If we know what Peter Cook’s knows it would be much easier tofully understand the risks. I can only play what’s in front of me.

It’s hard not to wonder who is behind the largest shareholding “Brayter group”!

I’m always looking for a reason to sell, especially when the chart isn't behavingbut truthfully, I can't see a reason to sell yet. Would I have loved to havesold at 0.79 and bought back in now? of course, but this is the market and I’mnot Nostradamus. Predicting the short-term swings of the market without insiderinfo is a game of chance. Either I let the emotions get the best of me and sell out, possibly reinvesting somewhere risky in attempt to reclaim the profit or reflect and invest based on reasoning, I choose thelatter.

None of this is financial advice and it just my opinions based off research from scouring the web.

Fingers crossed some of this is on the right track and Novatti continues to surprise us ; )