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Overview

Red flags

Following our review, there is nothing that would appear to us to be a dealbreaker.

Key points to note

Revenue model is top-down based on MoM growth - expectation in the US is for 100-130% growth in fist 6 months (20-30% elsewhere).
Growth is expected to come from new clients (70%) and expansion of current client sites (30%). 16 new clients ready to go live - the three largest of which they expect to add £3.6m in ARR (90% closed).
Staff costs as % of gross revenue appear very low in the model (from >50% historically to 1%) - due to Gross Revenue increasing exponentially but costs being grown out linearly.
There is slow cash collection due to waiting for invoices from suppliers to be able to put on mark-up (high trade debtors in Dec 2019 - £1m). The process needs to be updated urgently to meet growth.
High burn rate but at status quo (Dec 2019) revenue/ costs £7m raise (plus NWC) gives a 2 year runway.

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