MyRewards International has been featured in Stockhead discussing the company's live IPO and future plans for global expansion, with a recent contract signed with Ria Financial.
The ASX will welcome its latest fintech entrant early next month when customer loyalty platform My Rewards International (ASX:MRI) joins the boards.
The company is looking to raise $5m from investors at 20c per share, as it eyes global markets for its digital rewards solution through a recent contract with international payments group Ria Money Transfer.
My Rewards International
Brief History
My Rewards International was founded more than 20 years ago as a provider of discount coupons for retail buyers and incorporated a corporate customer base with its 2009 purchase in employee benefits platform Pegasus.
The combined group followed a consistent business strategy until 2015, when technological developments caused "the market for loyalty rewards become more sophisticated", chairman David Vinson said.
CEO Maitreyee Khire joined the firm and became a substantial investor the same year.
According to Vinson, MRI's ability to stay agile in a shifting digital world has been proved during the last six years.
“That was the start of our evolution to becoming a tech-based loyalty reward company, with integrated systems built for adoption in line with the growth of e-commerce.”
David Vinson, Chairman, My Rewards International
Next Steps
The article states:
"After buying 50% of Pegasus in 2009, MyRewards bought out the company in 2017 to vertically integrate its corporate client base.
The company serves a network of around 4,500 suppliers across sectors such as ecommerce, major grocery chains, hospitality, entertainment and travel.
Heading into 2022, its operational focus is on the launch of an integrated digital wallet to generate revenue from members’ in-store transactions."
My Rewards also mentioned a recent partnership with Ria Money Transfer in its prospectus, which would let it extend out its customer rewards programme to six countries in the Ria network.
The article states:
"Based in California, Ria specialises in global money remittances with annual revenues of just over US$1bn.
Domestically, MRI also provides its employee rewards programs to a suite of large corporate clients such as Telstra and MLC, the company said.
In line with the changing tech landscape, Vinson said the company is also focused on building out its AI and machine learning capability via the data generated from e-commerce transactions."
“ The whole idea is to be leading the charge in having a marketplace with a relevant and personalised experience for users.”
David Vinson, Chairman, My Rewards International
David Vinson adds:
“So the company’s really focused on that tech underpinning where we’re going as an end-to-end provider of employee benefits, discounts and redemptions. And the next goal is to do that on a global basis through the links we’ve got with suppliers.”
Listing Rationale
Vinson noted that the company's move to the ASX boards marks a great opportunity to capitalise on steady growth in the broader rewards sector.
The article states:
"In that context, it will deploy capital to consolidate its footprint across online and physical retail channels."
Vinson says:
“The last 18 months or so have been very beneficial to the online side of our business.
“Although one way we’re differentiated is that we’ve built market share for two decades across thousands of in-store suppliers — hairdressers, cafes, health providers etc.”
“ I think the pandemic demonstrated the power of online models and in that sense it helped to heightened awareness of our style of business, but we’re also broader than that. We’ve got a fully integrated network and that in-store component is also a key part of what we do.”
David Vinson, Chairman, My Rewards International
In regards to the MRI’s $5 million raise, Vinson explained that the group isn’t looking for a large cash-flow injection – partly because it’s scaling the model with steady per-unit economics.
In comparison to fintech peers, Vinson believes the valuation is conservative.
Vinson adds:
“If you look at recent listings in the space, they’ve generally gone out somewhere between 5x and 8x revenues,” he said.
“We’re going out at around 1.3x pro-forma revenues, so we think it’s a favourable valuation and we wanted to price it at a level that would look compelling to incoming investors – not just pre-IPO investors.”
The article states:
"The company is also tracking towards EBIT breakeven as it taps new markets through the Ria partnership, after booking an underlying loss of -$1.195m in FY21 on revenues of $27.316m (FY20: -$1.521m, $27.059m)."
“We’re not far off a breakeven position already, particularly relative to other companies where you see much bigger losses. So we’re very close to economies of scale on that global basis.”
David Vinson, Chairman, My Rewards International
Looking ahead, the company's goal is to grow its customer base from current levels of 4.6m through Ria’s global 30m-strong customer base.
Vinson states:
“We want to take the members we’ve got and look at how we can make them more active. Then when they are active, look at how we can increase sales and the margin on those sales.
Those developments in AI and data analysis are a key part of that, giving us insights into where we can promote more products.
So those operational goals are the key deliverables the management team will be focused on in 2022 post-listing.”
Read the full Stockhead article here.
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