Investor deck march 2017 final

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  • 1Contains proprietary and confidential information owned by Synacor, Inc. / 2017 Synacor, Inc.

    DRIVING GROWTH IN ATTRACTIVE DIGITAL MARKETS

    M A R C H 2 0 1 7

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    SAFE HARBOR

    "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements concerning

    Synacors expected financial performance as well as Synacors strategic and operational plans. The achievement or success of the matters covered by such

    forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove

    incorrect, the company's results could differ materially from the results expressed or implied by the forward-looking statements the company makes.

    Synacor is under no obligation to, and expressly disclaims any such obligation to, update or alter forward-looking statements, whether as a result of new

    information, future events, or otherwise.

    The risks and uncertainties referred to above include - but are not limited to - risks associated with: execution of Synacors plans and strategies; the loss of a

    significant customer; the companys ability to obtain new customers; expectations regarding consumer taste and user adoption of applications and

    solutions; developments in Internet browser software and search advertising technologies; developments in display advertising technologies and practices;

    general economic conditions; expectations regarding the company's ability to timely expand the breadth of services and products or introduction of new

    services and products; consolidation within the cable and telecommunications industries; changes in the competitive dynamics in the market for online

    search and display advertising; the risk that security measures could be breached and unauthorized access to subscriber data could be obtained; potential

    third party intellectual property infringement claims; and the price volatility of Synacors common stock.

    Further information on these and other factors that could affect the company's financial results is included in filings it makes with the Securities and

    Exchange Commission from time to time, including the section entitled "Risk Factors" in the company's most recent Form 10-K filed with the SEC. These

    documents are available on the SEC Filings section of the Investor Information section of the company's website at investor.synacor.com.

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    INVESTMENT HIGHLIGHTS

    A Transformation Story with Multiple Profitable Growth Avenues

    STRONG OPPORTUNITIES FOR

    GROWTH

    RECURRING AND FEE-BASED REVENUE

    MASSIVE TRANSFORMATION

    ON A PATH:

    3 YEARS (2019)

    $30M EBITDA

    $300M REVENUE

    SEASONED MANAGEMENT

    TEAM

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    PORTALS EMAIL ANDCOLLABORATION

    MULTIPLATFORM VIDEO

    CLOUD ID

    ENGAGING CONSUMERS

    ADVERTISING

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    MISSION

    We enable our customers to better engage

    with their consumers

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    TWO PRIMARY SOURCES OF REVENUE

    SEARCH AND ADVERTISING RECURRING AND FEE-BASED

    Advanced Portal

    Experiences

    Email/Collaboration Video Platform/Cloud IDAdvertising Solutions

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    MULTI-PLATFORM PORTAL EXPERIENCES DESIGNED FOR ENGAGEMENT AND MONETIZATION

    Personalized, curated, and relevant content experience that drives engagement and reinforces ISP brand across devices

    Modern design, stream-based experience

    Hundreds of thousands of articles and videos

    Push notification for breaking news

    Flexible and customizable for customer needs

    Monetization through integration with Synacor Media

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    Combined Technorati with Synacor, creating direct and programmatic advertising platform at scale:

    Strong Monetization

    Search, display, video and mobile ad products

    Direct, programmatic, network monetization

    Publisher and Portal Network

    Operated and managed portals

    Publisher platform

    Targeting Expertise

    Proprietary and third-party data

    Ad Ops and Analytics

    Hundredsof Publishers

    SYNACOR MEDIA: COMPELLING AD PLATFORM AT SCALE

    200MUniques

    35M+Broadband Households

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    SEARCH & ADVERTISING GROWTH OPPORTUNITY

    Launch AT&T

    Win new portal customers

    Programmatic growth

    Grow publisher reach and products

    Expand mobile monetization

    Digital Ad Spending

    15%

    $72BTotal Market

    Source: eMarketer, growth for 2016 - 2020 9

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    EMAIL & COLLABORATIONOPEN, SECURE, PRIVATE PRODUCT SUITE

    Powering ~500M mailboxes

    one of the largest providers

    of white label email in the world

    Offered as open source, on-prem

    software, and as a fully managed &

    hosted solution

    Unmatched migration

    & hosting capability

    Serving service providers,

    government agencies, and

    business enterprises

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    EMAIL & COLLABORATION GROWTH OPPORTUNITY

    Open source program to monetize ~400 million existing mailboxes

    Open Source Support subscription

    Suite Plus (e.g. backup, admin tools)

    Grow government customer base focusing on security & privacy

    Leverage partner community to accelerate feature development and grow sales

    Market Growth

    24%

    $19BTotal Market

    11Source: Radicati, growth for 2016 - 2020

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    VIDEO PLATFORM/CLOUD IDEND-TO-END VIDEO AND IDENTITY MANAGEMENT PLATFORM

    Able to authenticate nearly all Pay TV households in US

    Selected to provide Cloud ID Authentication for HBO Go

    Supported deployment of Apples Single Sign-On platform

    Participating with CTAM & OATC on industry standards

    Debuted end-to-end TVE and OTT solutions for GVTC and Consolidated

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    VIDEO PLATFORM/CLOUD ID GROWTH OPPORTUNITY

    Win new video platform customers

    Win new content provider customers

    Extend Cloud-ID into new verticals and geographies

    Online OTT & Video Revenue

    76%

    $37BTotal Market

    13Source: Digital TV Research, 2010 - 2020

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    BLUE-CHIP CUSTOMERS AND PARTNERS

    Advertising and Content Partners

    Command and Simulation Solutions

    Chile

    120 Service Providers, 1,000 Government Agencies, 2,500 Businesses, 1,000 Publishers

    ADVERTISING

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    2016Won new portal customersWon new video platform customers2017Win new portal customersGrow government email customersWin new video platform & content provider customers

    2016Became a significant player in programmatic advertising2017Launch AT&T Programmatic growthExpand mobile monetization

    4-PILLAR GROWTH AGENDA BUILT ON OPERATING DISCIPLINE

    Increase value for existing customers by optimizing consumer

    experience & monetization

    Innovate on Synacor-as-a-platform for

    advanced services

    Win new customers in current and

    related verticals

    Extend product portfolio into international

    and enterprise

    PROFITABLE REVENUE GROWTH

    OPERATING DISCIPLINE

    2016Extended Cloud-ID into new content verticalLaunched Open Source Support offering for email2017Grow Open Source Support adoption

    2016Activated email partner community Introduced Synacor products in new geographies2017Leverage partner community to accelerate email feature developmentWin customers in new geographies

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    SYNACORS 3/30/300 PATHTARGETING $300M IN REVENUES AND $30M IN EBITDA IN 2 YEARS

    Revenue, $Millions Adjusted EBITDA*, $Millions

    *Please refer to the appendix for information regarding the reconciliation of GAAP net loss to adjusted EBITDA for twelve months ended December 31, 2015 and

    December 31, 2016 and for guidance for twelve months ending December 31, 2017. Guidance is as of March 15, 2017.

    INVESTING ~$10M BETWEEN 2H16 1H17 TO DEVELOP AND DEPLOY AT&T

    $106.6$127.4

    $160 - $170

    ~$300

    2015 2016 2017G 2019G

    $7.6

    $3.2

    $6 - $10

    ~$30

    2015 2016 2017G 2019G

  • 17

    INVESTMENT HIGHLIGHTS

    A Transformation Story with Multiple Profitable Growth Avenues

    STRONG OPPORTUNITIES FOR

    GROWTH

    RECURRING AND FEE-BASED REVENUE

    MASSIVE TRANSFORMATION

    ON A PATH:

    3 YEARS (2019)

    $30M EBITDA

    $300M REVENUE

    SEASONED MANAGEMENT

    TEAM

    17

  • 18

    THANK YOU

  • 19

    APPENDIX

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    ADJUSTED EBITDA RECONCILIATION

    Q1 2015 Q2 2015 Q3 2015 Q4 2015 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 2016

    Revenue 26,730 24,716 26,351 32,448 110,245 30,260 30,476 31,721 34,916 127,373

    Net loss (1,073) (1,082) (931) (388) (3,474) (1,565) (2,757) (3,365) (3,053) (10,740)

    Provision (benefit) for income taxes 4 16 10 209 239 144 260 379 436 1,219

    Interest expense 50 59 35 102 245 68 84 75 91 318

    Other (income) expense 16 (17) 32 (16) 16 (2) (242) 38 248 42

    Depreciation and amortization 1,496 1,660 1,560 2,185 6,901 2,098 2,270 2,414 2,453 9,235

    Stock-based compensation 742 800 810 764 3,115 737 687 680 667 2,771

    Loss in equity interest 32 25