I think the pullback whilst being quite substantial is a case of some end of week jitters, combined with momentum traders trying to orchestrate a bigger pull back in order to soak up shares.
There have been some good posts about revenue figures and without minimising the forecasts I simply think for a company that IPO'd in this quarter and is agressively rolling out trials and picking up tier 1 clients, revenue at this point is not why anyone is investing with a medium to long term view of the stock. I have a few reasons why I am not worried and why this quarterly will not matter in months or a year's time.
1. Jamie Pride has pedigree and if he thinks this will be a billion dollar company then that's why we are here
2. The technology is revolutionary, it improves HR efficiency in a transformative way, is easy and a pleasure to use.
3. We have a first mover advantage, have just acquired a complimentary business, and paid little for it. Most of the deal was in script, which should say it all (as the acquired wants to be part of this great story)
4. We are still developing products with the release of "Educate" next year.
5. Jamie is moving to the US in coming months and If we snag a big US company it will be on for young and old.
But most importantly,
6. We are not investing in a growing revenue company... YET. We are investing in a potential 'unicorn' who has disruptive technology that major corporates want and are enjoying, (we have heard great reviews and viral growth within the businesses). This company should not be measured on it's revenue after 3 months of being a public company. Reffind's success will come from it's ability to attract customers and build up sticky revenues with it's increased product suite. Reffind wants to become indispensable to a business' Human Resource Management. Too much money is wasted on wasted training and turnover from unmotivated employees. RFN solves a massive problem in this management space.
I don't think I need to repeat about the facebook's and the other billion dollar tech companies as we all know the revenue's didn't come or still haven't come in some cases. Make no mistake in this era it is solely about a land grab or a grab for users and businesses. Look at 1pG and how easy they raised 50m. I would rather them spend the money to get US clients than concentrate on revenue at this point. We are in a growth stage, not a mature business that needs to lower admin costs and chase revenues. That comes later.
Finally a couple of things on 'unicorns' and big tech companies:
From the FSB latest tech report.
We believe there is a ‘blueprint’ to look for when investing in a new tech listing. In addition to an attractive starting valuation, we consider it imperative that companies are seeking to list and raise capital to ‘accelerate’ rather than ‘create’ i.e. (not concept stage). We have witnessed share prices of many companies struggle due to being too early stage. Investors should target new listings where companies are preferable generating revenue (even if small) or that are on the verge of commercialisation (e.g. pilot contracts), together with a clearly defined revenue model. The market opportunity that the listing company is going after should also be large (i.e multi-billion dollar market). It is difficult to build a billion dollar business solely focused in Australia with a population of 25m people. An international focus is crucial.
From the AFR & Wilston HTM Analyst George **riel on valuations -
http://www.copyright link/technolog...watch--its-a-jungle-out-there-20151012-gk6skc
Although the labels might help investors to compare and contrast **riel says the most difficult aspect when considering remains how to determine their worth. "The challenge for investors is that traditional valuation metrics don't apply during the "land-grab" customer-acquisition phase," he says.
Given that difficulty, he suggests investors look for "qualitative" factors such as whether there are barriers to entry for newer rivals, how loyal a company's customers are and the experience of the management team. **riel says the "ideal mix" for a start-up's management team is a chief executive with industry or customer specific experience, a chief technology officer and a finance person with an operational background.
So the question remains back to holders, if you invested because of the points above or for similar reasons. What has changed? Were you expecting revenues to be out of the ball park? I wasn't... And if revenues matter for you right now, then perhaps this isn't the story for your risk appetite. It is for me, and I like many others I am sure will hang on for the ride, and I will bet that is an exciting one.
Lastly on a side note, I don't like targets, but I still secretly can see this getting back to $2 very easily before christmas. GL to all holders
(20min delay)