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https://www.birminghammail.co.uk/travel/new-travel-rules-testing-start-21843908

Thanks Danl

If so , was this his SoftBank valued Ingenuity at £4.5B

Say £200M ARR ?

Put aside the theoretical ‘ double ‘ booking of revenue if this is the case you can kind of see how the grand plan break up stacked on desk top presentation

Alchemy

Danl

Including inter Co trading was Ingenuity £88M ARR for interims - £18M external clients

Or have I got that wrong ?

Enjoyed the sharing of views on this Board, refreshing.

Danl, agree, websites & £cash is the only tangible asset to value after yesterday’s presentation.

Ingenuity will require funding in its current state, how much of the free cash from the web sites will need to be diverted to Ingenuity? No one really knows?

As such is it 1X revenue value plus cash - very best 1X as the uncertainty of how much Ingenuity actually requires is unknown and the websites producing the cash will be restricted of ongoing investment, it’s a vicious circle.

That puts a share price of around £1.70, I can’t see how the market after yesterday will afford THG a premium with so much uncertainty.

Interesting thesis Danl

Hindsight
They should have done the split before the IPO

Any ideas ? With back up explanation ?

Am going for £2B m/cap
1 times Sales

Backwardization

£2.75 offer

Market frozen

Dust down overnight Danl - bale
This one is going much lower

Guess the problem is at £5B m/cap on £2B Rev

At what value does the market put on the websites - as such
Ditto Ingenuity ?

If it’s 1.5X for the former or even less - as it’s funding Ingenuity so can’t be measured accurately

Where does it stop ? No idea but feel this has a lot more to go yet before thinking of a top up

It’s not pretty to watch

Cheers Danl

Looks like this is going to take a pasting

Thanks for updates Danl

Hi, Notry

Yeah, SoftBank tend to go in on a Series C round then bring a business to the market, they bypass Series A, B.

Decent description below - suggest it’s fair to say Ingenuity fits this description with say £40M ARR end of year
The model is proven but it needs scaling / funding

What is Series C funding?
Series C funding has the goal of preparing a company to be acquired, go public on the stock market or undergo significant expansion. It is usually the last stage of fundraising a startup goes through, although some businesses pursue additional rounds to raise more capital.
Companies that go to this round of investments that already have proof of their success and a high valuation averaging $115 million. While previous rounds of funding use investment money to start making money and carve out their space in the market, Series C funding funnels large amounts of cash into profitable businesses to scale them up as quickly as possible and get a fast return for the investors.
Businesses that seek out Series C funding are not startups anymore, but established, mature businesses with a dedicated customer base and strong brand recognition

Mars,

It looks highly likely that we have to pass EU HUA to come back into the U.K. through the back door for U.K. Home Use - in this case Airport passengers

Unless the Airports carry out the testing themselves then it’s CE accreditation

EU HUA is key now.

Thats my take on the situation as it stands today.

Danl
Just on the cash … will SoftBank convert at £4.5B ?
They have an option to, that’s it.

If you were SoftBank you would get to understand the business model, treat this recent transaction as a Series C round - which is what they specialise in

It’s Softbanks MO

Push for the Demerger ( already started the process )and underwrite the IPO? Not sure if that’s £4.5B but I guess it will be lower, can’t see Ingenuity being worth more than £1B - as you and I have discussed

If Matt wants to avoid scrutiny on the model he could reverse into a SPAC / Shell on Nasdaq with SoftBank underwriting.

Some merits in the above for all parties

Comp

Not sure that’s fully correct ?

We know Mologic failed PD for whatever reason?

Both parties must have agreed for Omega to apply via EU HUA and come back into the U.K. vIa the back door - which stacks with the disclosure from the Government that there are tests out there seeking alternative routes than PD

Suggest this is the clear pathway for Omega, but it appears it’s all on EU HUA, they secure that and they hope to convince DHSC to instruct them to produce the Vistech test.

It’s took longer than Colin thought it would and included a Userbility Trial

We are were we are, we await the EU HUA

As £ARR is based on forward reoccurring revenue we can evaluate the monthly external revenue from Ingenuity is around £3M a month max
This division needs some serious £money to scale up, Matt has known that hence the SoftBank JV - in effect

Will SoftBank convert at £4.5B value on a £3M a month £ARR or sit back and push for Ingenuity to be demerged and they fund at that point - at whatever price the market sets at the time?

Personal opinion

Demerge Ingenuity has to be the only solution

Separate quote on Nasdaq where it has a better chance of being understood/ raising funds.

The £2B Rev from the vertical supply chain / web site model can then be valued by the market

The main issue to me how much ££ does Ingenuity require to scale the business ? It’s current external £ARR was just
£18M at the interims.

It will require £cash from the Web site operations and or use the £200M cash held and this potentially leaves the websites restricted for capital.

Ingenuity raises its own capital and at same time opens its books in terms of its revenue stream

Without the above the market will put a lowly rating on the annual revenue from the Websites