ackroo investor deck · certain written and oral statements included in this presentation may...

Copyright 2020 Ackroo Inc. All rights reserved.

Ackroo Inc.TSX Venture: AKROTC Pink: AKRFF

AUGUST 2020


ACKROO INC. DISCLAIMER

Certain written and oral statements included in this presentation may constitute “forward-looking information” which reflect thecurrent expectations of Ackroo. This information reflects Ackroo’s current beliefs with respect to future events and are based oninformation currently available to management. Forward-looking information involves significant known and unknown risks,uncertainties and assumptions. Many factors could cause actual results, performance or achievements to be materially differentfrom any future results, performance or achievements that may be expressed or implied by such forward-looking information.Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-lookinginformation prove incorrect, actual results, performance or achievements could vary materially from those expressed or impliedby the forward-looking information contained in this presentation. Although forward-looking information contained in thispresentation is based upon what Ackroo believes to be reasonable assumptions, management cannot assure Users that actualresults, performance or achievements will be consistent with this forward-looking information and cautions that undue relianceshould not be placed on the forward-looking information. The forward-looking information is made as of the date of thispresentation and Ackroo does not assume any obligation to update or revise it to reflect new events or circumstances, except asrequired by law.

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What we do

Our Vision

To simplify, consolidate and improve the merchant marketing and payments landscape

Our Mission

Through industry consolidation we help Automotive, Petroleum, Hospitality and Retail merchants of all sizes attract, retain and grow their customers and their revenues

Our Solution

▪ An easy to use, self-serve marketing platform that manages important currencies including loyalty, gift card, promotions and payment.

▪ An open solution that integrates seamlessly into a merchant’s point-of-sale or customer engagement application

▪ A data focused product that provides merchants with key insights and tools to help shift, lift, retain, and engage their customers

▪ An in-store and online solution that will continue to evolve through product and industry consolidation

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Gift Cards Loyalty Marketing PaymentsData


How we do it

We provide a closed loop in-store and online automated marketing & payments solution

We also provide additional services to help our clients grow

Process gift card, loyalty & promotional transactions at

the point-of-sale

Provide merchants with important administrative

and marketing data

Allow consumers to access and manage their gift card &

loyalty accounts

Help merchants sell their gift cards at

other retailers

Distribution Marketing

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Email Marketing

Direct MailGift Card Mall

Payments

Credit & Debit Transaction processing

Data

Business Intelligence


$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

2012 2013 2014 2015 2016 2017 2018 2019 2020*

Our Results – Revenue

Fiscal Year Amount +/-%

2012 $681,142 N/A

2013 $1,284,016 89%

2014 $1,328,166 3%

2015 $1,822,224 37%

2016 $2,224,165 22%

2017 $2,737,830 23%

2018 $4,435,019 62%

2019 $5,233,227 18%

2020* TBD X%

Annual Revenue Revenue Data

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Note: 2020* #’s are based on annualizing YTD announced results


-$4,000,000

-$3,500,000

-$3,000,000

-$2,500,000

-$2,000,000

-$1,500,000

-$1,000,000

-$500,000

$0

$500,000

$1,000,000

$1,500,000

Our Results - EBITDA

Fiscal Year Amount +/-%

2012 - $3,421,920 N/A

2013 - $2,509,484 27%

2014 - $1,608,162 36%

2015 - $853,021 47%

2016 - $607,466 29%

2017 - $502,315 17%

2018 + $406,427 N/A

2019 +$614,034 51%

2020*(TBD) +$X X

Annual adjusted EBITDA EBITDA Data

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Note: 2020* #’s are based on annualizing YTD announced results

2012 2013 2014 2015 2016 2017 2018 2019 2020*


Financial Highlights

✓

Proven Execution

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36% Revenue CAGR

Closed 9 M&A deals

95% Retention Rate

88%Gross Margins

EBITDA Positive as of 2018

77% EBITDA CAGR

✓ ✓

✓✓

✓

✓

✓ ✓81%

Recurring Revenue

Cash Flow Positiveas of Q2 2019

19% EBITDA Margin


•Founded & listed on TSX-V

Our Story – Major Milestones

•Rebuilt Ackroo technology•Defined commercial model

•Steve Levely as CEO•10-1 Share consolidation

•Acquired PhotoGIFTCARD & Dealer Rewards

•Acquired OnTab, D1 Mobile & Loyalint

•Acquired KESM/LoyalMark

•First EBITDA positive year

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2015

2017

20122014

20162018

2019

•Acquired IQ 724•Added AckrooPAY

2020

•Acquired WinWin & BNA•Added Ackroo BI

2013


Ackroo will continue to differentiate in the future by expanding into other

aspects of the industry’s ecosystem

Market Positioning

Marketing

Payment

P.O.S.

Data

Gift/Loyalty

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Ackroo Today Industry Ecosystem

Companies within all 5 areas are partnering, competing and

consolidating

Ackroo Future

Ackroo is differentiated today by providing expanded marketing,

data & payments services

Marketing

PaymentsData

Gift/LoyaltyMarketing

Payments

TBD

Data

Gift/Loyalty


The North American Gift Card & Loyalty market is estimated at $180B

Estimated 20% CAGR

Addressable Market

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Automotive Petroleum Hospitality Retail

Ackroo’s current % penetration of the CDN & US Market

CDN Market US Market

SIGNIFICANT ROOM FOR GROWTH

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Client Benefits

Gift cards increase merchant revenues and cash flow

Loyalty protects margin, attracts customers, creates lift and drives behavior

Marketing platforms provide key insights and actionable tools to drive results

Other Ackroo platform benefits for merchants

✓ Removes manual labor, fraud and theft from paper

based options

✓ Centralizes data and reporting for gift card and

loyalty programs

✓ Enhances their customers experience

✓ Provides a self-serve platform allowing for swift

changes to marketing strategy & admin setup

✓ Provides a centralized solution for all primary

merchant currencies

✓ Provides significant cost savings for debit and credit

card processing

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Payment Processing is a necessary service needed for all merchant types

Data increased merchant knowledge to drive behaviors


Large/Enterprise Merchants:

Medium Sized Merchants:

Small Sized Merchants:

Some of our Clients

ACKROO SUPPORTS OVER 4,800 CLIENT LOCATIONS AND GROWING

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Some of our Partners

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2. Monthly Subscription

Revenue (MRR)

•$83 per month avg.

3. Variable Subscription

Revenue (MRR)

•Payment & specialty services commissions

1. One Time Services Revenue

(OTR)

•Platform Setup, Cards/collateral & Custom Dev costs

4. Marketing & Data Services

Revenue (OTR)

•E-mail & direct Mail marketing•BI setup & services

Business Model

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$25 - $500 a month per location

•Platform access, development & support

•7% + of customers •$19 per month avg. •10% + of customers

Varies based on usage/needs

$250-$1000 per location

Varies based on usage/needs

81% + of all revenue is recurring


Via new partners + offerings

Organic Growth

Specialization

Sales ChannelProduct Partners

Cross Sell Customers

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ProductApproach

Gift

Geography

Product = Self Serve SMB + Advanced Mid-large Market offering

Services = Marketing, Data & Payment

Increase # of POS

Expand Services

Expand Product

US Expansion

CDN Expansion

MSLoyalty

PromoE-Gift

PSDS

Grow revenues by 10% + each year organically


Deal # 1 2 3 4 5

Company Photo GIFTCARD Dealer Rewards OnTab D1 Mobile Loyalint

Rev Mult Paid 2.5x 2x N/A 1.5x 2x

Structure 100% stock 80% cash | 20% stock Cons Ag 100% stock 80% cash | 20% stock

Integration Time 3 months 24 months 6 months 5 months 8 months

Inorganic Growth History

Extra WINS from M&A over and above of customers, revenue and talent:

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PGC added Gift Card

fulfillment

Deal # 6 7 8 9

Company KESM LoyalMark IQ 724 WinWin Marketing BNA TBD

Rev Mult Paid 1.5x 2x 1.5x 2x TBD

Structure 10% cash | 90% stock 100% cash 100% cash 100% cash TBD

Integration Time 18 months TBD TBD TBD TBD

DRC & Loyalintadded

Automotive Specialization

IQ724 & WinWin

added BI and Digital

Marketing tech

BNA added payment services

OnTab & D1 Mobile added

Mobile

KESM added Petroleum

Specialization and

profitability


Inorganic Go forward Strategy

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Acquire 1 -2 Per Year

Add customers, tech + talent

40%+ of rev adds to EBITDA

Expand solution & reach

Focus on accretive deals

Consolidate a fragmented market

Grow revenues by 20% + per year inorganically

Normalize within 12 months


Gift Card/ Loyalty Marketing/ Mobile

• Lots of companies in each area• Most companies are private companies• Each company has their niche’s they focus on (size and/or vertical)• Many are starting to develop and sell products/services into other areas• Ackroo is focused on consolidating this marketplace

Some direct & indirect Competition

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Payment Point of Sale


Some public market peers

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AIM.TO: Focus on enterprise coalition loyalty programs AKR.V: Focus on small to mid sized direct loyalty, gift card and payments programs

LSPD.TO: Focus on SMB point of sales solutions for hospitality & retail + offer basic loyalty, gift and paymentsAKR.V: Integrate with point of sale solutions like LSPD + offer advanced loyalty, gift, data and payment services across Hospitality, Retail, Auto & Petroleum

SHOP.TO: Focus on small e-commerce business point of sale solutions primarily in retail + include payments AKR.V: Integrate with e-commerce solutions like Shopify + offer advanced loyalty, gift, data and payment services for SMB & large merchants

NYSE.PAR: Focus on point of sales solutions for enterprise hospitality & retail and is US basedAKR.V: Focus on all sized merchants in loyalty, gift, data and payment services for Hosp, Retail, Auto & Petroleum

QIS.V: Focus on consolidating automotive software and services industry including DMS systemsAKR.V: Focus on consolidating the loyalty marketing, gift, and payments industry across Hosp, Retail, Auto & Petro


How we differentiate today

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Focus: Loyalty marketing, gift card and payments for all merchant sizes

Partnerships: Deeply integrated selected strategic partners

Platform: Latest technology, open architecture and self-serve

Affordability: Priced for all merchant sizes

Go to market: Channel & Direct sales approach + tech first – services second

Specialization: Petroleum, Automotive, Hospitality & Retail

Geography: Based in Hamilton, ON, Canada with North American focus

Other services: Distribution, marketing and payment services

Public Currency: Access to growth capital & liquidity draws interest for M&A


Additional Investor Checklist

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Market Leadership: Vendor consolidator for merchants + Industry consolidator

Cloud SaaS provider: Highly scalable technology infrastructure and approach

E-commerce & in-store: Omni-channel platform

Payments: New and emerging payment options – contactless etc.

Big Data: Multi-channel business intelligence tools

Digital/Mobile Marketing: Expanded product and services offerings

Proven M&A Results: 9 accretive deals and counting

Large TAM: $180B market and growing at 20% + per annum

Strong Revenue Growth: 36% CAGR since founding in 2012

Recurring Revenue: 79% of all revenue is recurring

Earnings Positive: 9 consecutive positive earnings quarters

Attractive Valuation: Trading @ 1.5x revenue and 9x EBITDA


• 77 millionShares

Outstanding1

• 7.2 millionOptions

Granted 2

• 10.4millionWarrants3

• 95 million Fully Diluted

• $9.3 MillionMarket Cap4

• Approx. 50% Insiders &

Management

• 10 % of i/o Options Pool

1. As of August 4th 20202. Average weighted options strike price is $0.13 3. Strike is $0.10 for 10,375,364 warrants expiring July 2022 4. As of August 4th 2020

Share Structure & Ownership

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Senior Management

▪ Steve Levely | CEOSales, Marketing and Executive leadership expertise; Pitney Bowes, Maritz, and Ackroo

▪ Derek Schaaf | CFOFinance & Executive leadership expertise; CMC Distribution, Great Blue Resorts and Ackroo

▪ Ihab Kazem | Director R&DEngineering & Product Management expertise; Bridgewater Systems and Ackroo

Board of Directors

▪ Steve Levely | DirectorSales, Marketing and Executive leadership expertise; Pitney Bowes, Maritz, and Ackroo

▪ Sam Cole | DirectorCorporate securities law expertise; ASKD Law and Cassels Brock & Blackwell LLP

▪ Wayne O’Connell | DirectorPublic and Private accounting expertise; Jones & O’Connell LLP

▪ Kristaps Ronka | DirectorTechnology founder, investor and executive; AdParlour and Namesilo

▪ Jason Donville | DirectorCapital markets research and investment expertise; Cormark Securities and DKAM

Our Team

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Ackroo Inc.Steve Levely

(416) 360-5619 x730

[email protected]

HAMILTON OFFICE

1250 South Service Road, A3-1

Hamilton, Ontario L8E 5R9

Contact Information

Simplify, Consolidate & Improve!

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mailto:[email protected]

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