Logiq, Inc.
Q3 2021 Earnings Call Transcript

Published: 15 Nov 2021

[Operator:]

Good morning. And thank you for joining us today to discuss the results for Logiq's Third Quarter ended September 30, 2021. Joining us today are Logiq's President, Brent Suen, its Chief Executive Officer, Tom Furukawa; and Chief Financial Officer of the Company's DataLogiq subsidiary, Rod Granero. Following their remarks, we'll open the call to your questions. Then before we conclude today's call, I'll provide some important cautions regarding forward-looking statements made by management during today's call. I’ll also like to remind everyone that today's call is being recorded and it will be made available for telephone replay following the instructions provided in today's press release. Now, I would now like to turn the call over to Logiq's President, Bret Suen. Sir, please go ahead.

[Brent Suen:]

Thanks, Adam. Thanks, everyone, for joining us. We just reported our financial results for the third quarter ending September 30. We had an 11% increase in revenue over the same year ago quarter, reaching $7.8 million. The growth this quarter demonstrates that we have pivoted back to the year-over-year revenue growth after coming out of COVID and refocusing our efforts on higher margin, higher quality revenue streams. So as a result, our gross margins expanded to more than 29.5%, which was nearly double from the gross margins of 15.8% in the same year-ago quarter. Over the last several months, we have also established a stronger foundation for addressing the e-commerce opportunities worldwide. And we believe the progress that we've made, particularly with the expansion of our gross margins, puts us well on the path to profitability and unlocking greater shareholder value. As a further means of unlocking shareholder value, we recently announced the Board's approval of our plans to separate DataLogiq and AppLogiq into two independent publicly traded companies. We believe that by creating two standalone businesses, DataLogiq and AppLogiq, the business will be in a better position to capitalize on their respective growth opportunities in the rapidly evolving e-commerce and FinTech landscape. We also believe that the separation will create higher pure valuations as compared to where Logiq is today, with AppLogiq and DataLogiq combined. Based solely on our review of comparable public market valuations as private equity funding that we're seeing for companies in emerging markets FinTech, we believe the standalone valuation for AppLogiq could be as much as $100 million or more upon completion of the split transaction. There are other initiatives for increasing shareholder value that we're pursuing, but first, I'd like to turn the call over to our DataLogiq CFO, Rod Granero, who will take us through the financial results for the quarter. Rod?

[Rod Granero:]

Thank you, Brent, and good afternoon, everyone. Earlier today, we issued a press release with a result for our third quarter of 2021, a copy of the releases available from the Investor Relations section of our website. As many of you know, we manage our business under two reportable segments. AppLogiq is our mobile commerce enablement and DataLogiq is our consumer marketplace and digital marketing platform. Now starting with our statement of operations for the third quarter. Our consolidated revenues for the quarter ended September 30, 2021 totaled $7.8 million. This compares to $7 million in the same period a year ago, an increase of 11%. As Brent stated earlier, the revenue and most importantly, our gross margins, demonstrates the continued positive trends based on the key strategic decisions made by management. AppLogiq contributed $2.8 million or 36% of our consolidated revenues in the third quarter as compared to $3.2 million for the same period a year ago, a decrease of $0.4 million or 11%. The decrease was primarily due to this return shipped to target high margin and -- customers compared to low margin high volume white label resellers. DataLogiq contributed $5 million or 64% of our consolidated revenues in the third quarter. This compares to $3.8 million or 54% of our consolidated revenues for the same period a year ago. An increase was due to an increase in data monetization revenue. Our gross profit more than doubled from the same quarter a year ago to $2.3 million or 29.5% of revenues, compared to $1.1 million or 15.8% in the same period a year ago, an increase of $1.2 million or 108%. AppLogiq’s gross profit increase 133% to $0.9 million or 31.7% of its revenues in Q3 2021, up from 0.4 million or 12.1% of its revenues in the same period a year ago. The improvement was primarily due to the company's strategic shift to target high margin and customers compared to low margin high volume white label resellers. DataLogiq gross profit increased 94% to $1.4 million or 28.2% of its revenues in Q3 of 2021 compared to $0.7 million or 18.9% of its revenues in the same period a year ago. The improvement was due to an increase in data monetization revenues, and an overall decrease of customer acquisition costs. Our total operating expenses in the third quarter of 2021 increase 104% to $8.1 million compared to $4 million in the same period a year ago. The increase in operating expenses was primarily due to increases in depreciation and amortization expense of $0.6 million, as well as due to general and administrative expenses of $3.2 million. The increase in G&A included increases of $0.5 million due to the Fixel and Rebel acquisitions, which we acquired in November of last year and Q1 of this year, respectively. Increasing operating expenses was also between increases in R&D expense of approximately $429,000, which was partially offset by a decrease in sales and marketing expense of $68,000. Of the increase in R&D approximately $0.3 million was due to Fixel with the remainder of the increase to AppLogiq. Our Q3, 2021 consolidated net loss total $5.8 million or $0.25 per basic and fully diluted share, as compared to a net loss of $2.9 million or $0.23 per basic and fully diluted share in the same period a year ago. AppLogiq incurred a net loss of $3 million in the third quarter of 2021 as compared to a net loss of $2 million in the same period a year ago. DataLogiq incurred a net loss of $2.8 million in third quarter of 2021 as compared to a net loss of $0.9 million in the same period a year ago. The increase is due to the additional net losses from the Fixel and Rebel acquisitions of $1.2 million offset by a decrease in the net loss of the legacy business. Now looking at our performance for the first nine months of 2021. Consolidated revenues totaled $24.2 million down 23% versus the first nine months of 2020. The decrease from the same period a year ago was primarily due to a decrease in the company's AppLogiq platform revenues, which was partially offset by an increase in DataLogiq's revenues which include a revenues from Fixel AI and Rebel AI. For the first nine months of 2021, our AppLogiq platform contributed $8.1 million or 34% of consolidated revenues, a decrease of 61% as compared to $20.6 million or 66% of consolidated revenues in the same period a year ago. DataLogiq contributed $16.1 million or 66% of consolidated revenues in the first nine months of 2021, which increased 51% from $10.7 million or 34% of consolidated revenue in the same period a year ago. DataLogiq revenues in the first nine months of 2021 exceeded all of the revenues generated last year. Consolidated gross profit increase 40% to $7 million or 28.8% of revenues, compared to $5 million or 15.9% of revenues in the same period a year ago. AppLogiq’s gross profit decreased 19% to $2.5 million or 31.2% of AppLogiq’s revenues in the first nine months of 2021 from $3.1 million or 15.2% of AppLogiq revenues in the same period a year ago. The improvement in gross margins was the result of the change in strategic focus from bulk white level distributors to direct marketing end users. DataLogiq’s gross profit increased 141% to $4.4 million or 27.6% of DataLogiq revenues in the first nine months of 2021 compared to $1.8 million or 17.3% of DataLogiq revenues from the same period a year ago. The increase is due to an increase in data monetization revenues and a decrease in overall customer acquisition costs. Total operating expenses for the first nine months of 2021 increase 84% to $22.3 million, compared to $12.1 million in the same period a year ago. The increase in operating expenses was due to an increase in general and administrative expense of $8 million, depreciation and amortization expense of $1.4 million, sales and marketing expenses of $0.5 million, and research and development expense of $0.4 million. Consolidated net loss, total $14.8 million or $0.76 per basic and fully diluted share in the first nine months of 2021, compared to a net loss of $7.4 million or $0.60 per basic and fully diluted share in the same period a year ago. Now turning to our balance sheet. As of September 30, 2021 cash, cash equivalents and restricted cash totaled total $5.3 million, compared to cash and cash equivalents and restricted cash of $5.8 million as of June 30, 2021. We believe our current cash levels are sufficient for the foreseeable future. This wraps up our financial review. Now I’d like to turn the call over to Brent for an update on our business development. Brent?

[Brent Suen:]

Thanks Rod. All-in-all, great trends emerging across our business lines, setting the stage for a strong finish to the year and an even greater 2022. I'm going to take a little different approach here. There's an entire script that was painstakingly prepared by CMA, our IR firm, and they did a terrific job. That being said, I actually want to get a little personal here. I've been doing this for almost seven years now. I turned down a job as head of Asia Pacific for one of the largest telecommunications companies in the world. And I took the low-market salary for years and so as my team. Sometimes there's actually none. We were paid in equity or shares. And we've bought shares in the open market. Over this timeframe, we've met companies that were raising venture capital and private equity funding that has turned into multi-billion dollar enterprises. Some of them are public recently like, Grab which is going into the AGC SPAC. Gojek, I know their founders. They're going public in the U.S. this year. In mean while, we are struggling fight for every little scrap, most of the time, we get outbid, we get beaten to the punch, we lose the opportunity, for whatever reason, yet we still keep coming back for more. One of the latest things that's happened and I think some of you who know us well, I have heard this story is that our IPL and the NEO which instead of getting us more attention and visibility, has instead created a scenario where there has been the ability to manipulate our share price downwards, every time it tries to go up. Even today, and this past week, I see the zoning in pressuring it lower and then forcing others to lose hope and so. I unfortunately, bear the brunt of this with people calling me, emailing me, and messaging me, asking me, what the heck's going on? And I'm not complaining. I just want to tell you guys, what we're doing. For months now, and also, most of you know this, if not all, I've been doing virtual road shows. I've been doing interviews, live streams, participating in market awareness campaigns. I've invested company money in IR, PR, and frankly, go out on a limb even further than most company leaders, even to the point where some of the public market awareness is considered low-browar and sophisticated, all for the sole goal of helping build stock value, which in turn will enable further growth of the business through M&A and expansion. Our loyal and long-term shareholders have seen this over and over again. And literally, yesterday, I was on the phone with one of them and you know what he said? He said, Brent, you know what, every time you get to the one yard line, something happens and it blows up. You just can't seem to get a break. And you know what he's right. And again, this isn't a complaint session. It's a here's what we're doing session. So I've been talking about valuation, and where ours is, and how it's so much lower than our peer group. How are we going to narrow it? And we've been trying to narrow that for a long-time. So trying to try to narrow it to where we should be trading in terms of price and market value is literally going to be done by either forcing it or creating a scenario where value is achieved. So when we talk about AppLogiq and spinning off the business through an IPL or merger with a public company, we are absolutely doing that. On DataLogiq, I just found out this past Friday, when I had a call with an investment banker. They're recommending that we do a direct IPL of DataLogiq directly to NASDAQ instead of up-listing. So we can actually do that. And in terms of up-listing, I'm going to tell you guys where we are right now. We did reapply. Our application as in. We meet all of the criteria, okay? We just sent the 10-Q just now. And our shareholder list to them. So hopefully, we know quickly. So whether we up-list or whether we take the IPL route of DataLogiq. And we're absolutely going to spin off AppLogiq through an IPL or merger with public company. We believe that in any of those cases, it will help move the valuation upwards to where we should be. And with that, we believe that we'll see greater attention paid to us by analysts, investors and institutions. So for now, I'll just say this, and then we can go into questions. Our team has believed in the goal of getting to $1 billion company for years and has stuck with us. We have a core group of investors, who I see many of you all on the list who are on right now. And I thank you, thank you for believing in us. We're going to keep working hard on getting to where we want to be and I really appreciate you guys sticking with us. So with that, we can open it up for questions.

[Operator:]

Thank you, sir. Thank you, sir. We'll take our first question from Steven Wildstein, a private investor, please go ahead.

[Unidentified Analyst:]

Hi, Brent. It’s Steve, how are you?

[Brent Suen:]

I'm great. How are you?

[Unidentified Analyst:]

I'm fine. Thank you. First of all, if I make your – if I may make a quick comment relative to your statement regarding the ultimate thing, whichever route you choose, I think that is without question proper, most beneficial and more expeditious way to go further in terms of increasing the value separate from of course on the corporate side of development. There's no question as you all know that by going to either NASDAQ or the NYSE that will allow and accommodate for a much more sophisticated investor, whether the – some funds, institutions, you know, research writers, et cetera, et cetera, that I think will come a long way, providing a much longer-term investor and not many of the traders that have basically taken hold in your company and the stock. The other quick question I have Brent is, in terms of the spin-off, at what point will you be able to do a or state publicly a data records for that spin-off because that itself could create some additional accumulation of the shears and also have sort of a carrot stick out there for the – those that are in terming the stock not to sell.

[Brent Suen:]

Wow, thanks. No, I appreciate that. Well, we – I think we have – we have stated that we intend to complete the first phase of the spin-off by – before the end of the year. Setting a record date, we would like to do along with that. So hopefully, before the end of the year, I feel quite comfortable that we can get there.

[Unidentified Analyst:]

Okay, that would be wonderful. I think that would go a long way in you know, basically giving a comfort level to the current investors and potential new investors as well.

[Brent Suen:]

Wonderful. Thanks, Steve.

[Unidentified Analyst:]

Welcome.

[Operator:]

And we'll take our next question from Lisa Thompson of Zacks Investment Research. Please go ahead.

[Lisa Thompson:]

Hi, guys.

[Brent Suen:]

Hey, Lisa. How are here?

[Lisa Thompson:]

Good. I'm so happy to see we're back to revenue growth. It's been a long year.

[Brent Suen:]

Yes. It's -- yeah, the team's done an amazing job. They've really done well.

[Lisa Thompson:]

Good, Maybe you could talk a little bit more about what's going on. I saw that DataLogiq has added some verticals and I'm wondering if that's going to change, maybe seasonality or we're going to have a big Christmas or it doesn't matter because you're not really doing that? And then also talk about AppLogiq and where you are as far as rolling out new services?

[Brent Suen:]

Sure, yes. You know what I would love for Tom to discuss DataLogiq. I know he's been spending a lot of time with the team and should be able to speak to that pretty well.

[Tom Furukawa:]

Yes, sure, thanks. I know, Lisa we -- you asked that question last Q and my answer was we're adding fund. That’s all. I actually have..

[Lisa Thompson:]

Right

[Tom Furukawa:]

So we did. And, you know, in terms of Q4, this is for us it's all about Medicare and open enrollment. And that is doing really, really well. So that'll really continue to allow us to have another, I would say, I'm very, very optimistic on ending the year really, really strong. The other verticals, we add in the Q3 which is -- we're starting to see growth is in the insurance space. So things around home insurance, auto insurance. Now those are very tangential to Medicare and many of the consumers that we have in our data, very -- we can quickly adjust and create the profiles to be able to go after these tangents full segments. One thing that's nice about the verticals we're adding is they are evergreen, right. Something like Medicare does have seasonality. And some of these have small you know, seasonality here and there, but no at this point in time, I think we were comfortable with the total number of verticals that we have, and we'll continue to increase revenues within those.

[Lisa Thompson:]

Do you think eventually you're going to start seeing some more maybe eCommerce purchasing kind of Christmas stuff going on?

[Tom Furukawa:]

Yes, yes, I think so. But I think that's going to be more on the LDM-side of the business, I think going forward or we see no agencies really pushing the big consumer marketing. No -- whereas DataLogiq, you know, in the consumer marketplace side, we see really these evergreen verticals of people wanting to fix up their house or renew their insurance. And these are things that some of them, we still have a lot of growth in those areas. And then there's also different channels as well and so we've also added additional ways to increase revenue in each of those verticals. And so we've implemented those in Q3. We're starting to see new revenues from different channels in the lead gen space starting to bear fruit.

[Lisa Thompson:]

Right. And since we're halfway through the quarter, do you have any insight as to what the fourth quarter is going to look like?

[Tom Furukawa:]

It's going to be bigger than Q3.

[Lisa Thompson:]

Bigger than last year.

[Tom Furukawa:]

Yes, bigger than last year. And I think a lot of cool statement. If you combine our DataLogiq revenue, Q1, Q2 and Q3, they're greater than all of last year. Right? So you know, Q4 is for us, but yes, it'll quarter-to-quarter growth and then year-over-year growth is what we're expecting.

[Lisa Thompson:]

Okay. Great. And what, kind of margins can you improve to? Are you – where you're going to be or is there more room?

[Tom Furukawa:]

Yeah. I think so. We're going to probably flirt in the – in the 30% to 32% margins. For – for – actually, I'm sorry, but 29% to 31% margins roughly in that area as a whole. And then in data logic, we're actually seeing, kind of some improvements here and there. But, this is where, where we have a nice level, right? If we want to grow revenue, we kind of know stabilize the margins, we actually doing really well in certain verticals and other verticals have bigger margins than others. And we can adjust spending there. But I think if you see historically, we're in the 29% to 31%, 32%. I think we'll continue to play in that area.

[Lisa Thompson:]

All right. Can you just talk a little bit more about cookies going away? Is that going to change anything?

[Tom Furukawa:]

Yeah. Yeah, so cookies itself is really going to affect more on the digital marketing side our LDM product line. And it is going away. We're starting to see it not affecting all products, because we are future proofing it. And the things that you've seen, I think, in the past with things like some testing, Geofencing, GumGum, Pier39, all of those are cookie-less solutions to get to where we have almost zero reliance on a browser site cookies. And so we are future proofing our platform. And these partnerships, along with our own internal AI, will allow us to effectively not have to rely on cookies at all. And that's been our overall strategy that we've been focusing on this year.

[Lisa Thompson:]

Have you seen the industry shifting at all, because I keep seeing those cookies every time I go to a website?

[Tom Furukawa:]

Well, it's starting to become, if you think about the devices, it's really starting to affect that area, right. And you saw those little warnings, even today, where it says, hey, do allow this app to be able to track you and its partners. There's a significant amount of people saying decline to that. So on the mobile space I think you've seen the impact. Desktop browser's not quite yet, but every browser asks the user to say, hey, do you allow this cookies on this website? Majority of people are saying yes to that one. So I think that's been okay. But, mobile's where it's at streaming videos, where it's at, and so you know, I think as a general marketing product, you want to be able to hit mobile you want to be able to hit streaming video services, and not so not be reliant on desktop computers and browsers going forward.

[Lisa Thompson:]

Okay. Great.

[Tom Furukawa:]

Cool.

[Lisa Thompson:]

Brent, can you tell us about app logic?

[Brent Suen:]

App logic, indeed. Yeah. So you're asking about new product offerings and what we're doing, right?

[Lisa Thompson:]

The ones that you've been announcing and stuff, have they started to roll out or is everything shut down or what's going on?

[Brent Suen:]

That's a great question. And I'm happy to elaborate on it since I went-off script here. Okay. So – so on – I want to frame this, because I think, I think those who are listening have been with us for a long time. And they've – they've heard – they've heard me talking about how companies in Southeast Asia are raising all this money. They're going to be coming public here in the US. It's the hottest region in the world for FinTech and for app businesses and in e-commerce and it literally is, and I'm not saying this in a boastful way, but everything that I said a year ago, two years ago, is clearly happening. Last week, there was an IPO of a Vietnamese company that is in FinTech and it's got a multi-billion dollar valuation. Okay. Grab is up 40% in the past week, because they're getting closer to the SPAC. So, the point of this is, are we smaller? Yes. Are we operating in the region? Absolutely. And what this tells people clearly is there is real interest in businesses that are operating there. Okay. So, going on to the product mix. We've been operating new wallet side of things, COVID actually didn't hurt that, so we continued on. It's competitive, margins are small in that space, but what we've always pointed to, is that that was an entry point into doing business in Indonesia and certainly in the region. And so that paved the way for AtozGo the delivery app, which got really great traction in a short period of time pre-COVID. Again, I'm sure everyone's heard the story, but COVID did hurt it. It hurt us a lot, primarily because our area of focus is in the central business district. And so Jakarta being a very highly concentrated area in terms of population downtown, hurt us significantly because most of our business actually all of our business was deliveries to office buildings. So the shutdown hurt us. I think certainly the positive part of it is that it enabled us to look around and see what other areas represented growth. One of those is the area that we announced last year in the fall. The partnership with the folks over at KMSB, which have provided in an entry way into the Social Security Administration for micro finance, so payday loans, borrowing against savings, taking out loans for small businesses, who are all part of the Social Security Administration, that pilot had been pushed out. We are actually in testing phase now. So it got pushed out a lot, pushed out about nine months, but we're doing it now. We -- with that what's really exciting is some of the banks in fact, one that we recently announced BPRS Insan Cita, saw that and they came to us and said could we do something just like BPJS is going to be dealing with you guys and of course we moved ahead with that. And there are a number of other ones that are coming to us. So I think that if you look at where we've come from, just operating new wallet and then rolling out a delivery business that is still different from the way that other people operate, and then segwaying into micro finance. It's all been a natural progression. We've always said that those are the three areas we're going to go into. We will continue down that path. What I can say is that we are looking at other markets as well. We announced Nigeria. We are talking to people in Vietnam. We're talking to groups in Malaysia, Thailand, and even some other emerging markets as well. And as part of the spin-off of AppLogiq, we are also in talks with people for merger and acquisition, who are either current partners or have looked at us on a strategic basis in the past, and they're seeing other companies from the region go public here in the US, and they want to be part of that. So, I think there's a lot of really great stuff that's going on not only with us, but also just in the region. And people cannot sit and say, wow, what's going on over in Southeast Asia, is -- are there real opportunities there and Wall Street's clearly showing it.

[Lisa Thompson:]

Okay. Do you expect that to be sequentially up, that business?

[Brent Suen:]

I think -- well as the risk of getting in trouble. I think it's going to be explosive is there's just -- there's just no way that it can't. The population base, the smartphone penetration, the need for this, the need for real government mandated programs is absolutely there. And we're part of that. So, I would say that, that growth is sequential may not be it, it may be more like exponential, especially if we layer on other partnerships and acquisition opportunities which we are absolutely going to do.

[Lisa Thompson:]

But that stuff hasn't quite kicked in right now. Right?

[Brent Suen:]

We are we are in pilot, but we're heading in a direction.

[Lisa Thompson:]

Okay. All right. Good. And then my -- I guess my final question is you talk about splitting it off and splitting. Have you made a decision as to whether you're going to be the majority owner or a minority owner?

[Brent Suen:]

Have we? Okay, well when we talk in terms of shareholdings, it will be the Logiq shareholders who are the owners of it. It will start off as majority owners and as we see opportunities to merge in a creative businesses, we might -- we will end up being minority owners, but I can comfortably say that we will aim towards minority ownership of a much greater and much larger company and platform.

[Lisa Thompson:]

Just wondering if you know, we're going to consolidate revenues for the time being still, right?

[Brent Suen:]

We'll see, yeah. Will do it in the past…

[Lisa Thompson:]

Yet or we haven't decided yet…

[Brent Suen:]

We haven’t decided because there's two ways we can do it. But in terms of speed and efficiency, which I think is first and foremost. So, we can either do it in an asset acquisition or an actual acquisition of the business. So, I think we're going to choose the faster route because what Logiq shareholders should get and what they deserve is the fastest path to getting this up and running within a listed vehicle here in the US.

[Lisa Thompson:]

Okay. So it's we would see by a year and right so hopefully emotional one.

[Brent Suen:]

We are emotional.

[Lisa Thompson:]

Okay. Good to hear. All right. Thank you. That's all my question.

[Operator:]

We'll take our next question from Chris Laquisha , a private investor. Please go ahead.

[Q – Unidentified Analyst:]

Hi, Brent. Thanks for taking my call. My question has to do with the Indonesian branch. I read the PR after hours here on the Super App, that's why I'm really excited about. With the SPAC happening right now, big buzz of AGC and Grab going on. It could be very, very bullish for us as a company, if you can launch that super app near term. How soon before we can see that super app actually come online?

[Tom Furukawa:]

That's a good question. So to put it in context, when we say super app, what that is, is an aggregation of a number of underlying apps. And I would say comfortably that's probably at least three. So if we say, are we well on the way to having a super app I think we're already there in terms of the base offerings an e-wallet logistics and delivery app and then a micro finance platform as well. The goal I think is to bring in things that are relevant to consumers. And I think what makes the most sense is small businesses, because whether it's in the Indonesia press or Vietnam or Thailand, small businesses, they’re really, really the whole lifeblood of business overall, because they don't have -- they have a handful of enterprises and then everyone else is a small business. So that's where the attraction lies in terms of rolling out a super app. You want to be able to offer things that are going to be used, things that are relevant and things that are sorely needed. What we're trying -- what we are doing is we are finding areas of growth and then things that are needed in either layering them into our existing, we can call the super app platform, or acquiring it through partnerships or actual M&A opportunities. Did I answer your question?

[Q – Unidentified Analyst:]

No, it did. That's excellent. My follow-up question to that is, it's amazing to think as an investor of a company that's valued at $75 million roughly that we're going to be going head-to-head to Grab Taxi. And if I have read it correctly in the news recently, Indonesia halted all FinTech permits, and they just granted you a percentage that you'll be able to lend at so that's a huge -- that's in our cap. It just amazes me as an investor that this hasn't caught on that little Logiq CreateApp over there has FinTech license granted with the Government of Indonesia and they're giving you a lending rate, something has to happen there, you know, I mean, someone else to click eventually.

[Tom Furukawa:]

Yes. Yes. As you're telling me that and I'm listening to it, and I'm thinking wow, where do I sign up? No, it does. It sounds great. But okay. In all seriousness, and I'll just -- I'll frame this out for everyone else. When Chris is talking about going head-to-head that's a tremendous undertaking. These companies like Grab, Grab has raised, I think, $12 billion in five years. They've got a $60 billion market cap right now with the fact that they're about to go into $60 billion. I mean, we're just a little rounding error to that. But I’d say this because when you look at an opportunity, okay, so you look at Indonesia, you look at Southeast Asia, there's only two ways to succeed, either you go in with scale and you raise a ton of money, which the top 20 companies there have done. Or you find a way to get defensibility and an opportunity by way of being very unique and very clever. Or you have entrees into government people who can help enable that. It's not easy to do. The first two endeavors we did with the e-wallet and then with the food delivery, I mean that -- there's a lot of competition there, tons and very well-funded competition. I think we did really well in the e-wallet side because instead of attacking head on in the Tier 1 cities, we just took the approach that we're going to go to the poorer areas, because although they may not be immediately attractive in terms of revenue generation, over time, as these emerging markets bloom, what happens is they become very relevant. And then the big guys come down the chain and they want to acquire the businesses that have gone in focus on that instead of trying to compete with them head on. Taking the approach on the food delivery business, we cut the delivery time by a third because we had guys and gals on foot down in the central business district that could run and pick something up without having to get on the scooter or motorcycle and park it and take off the helmet and all that other crap. And instead, they could get the meals up into the -- to the buyers in 15 minutes. So, that was a novel approach on those. With the whole social security micro-finance platform that was more relationship-oriented, the group that we partnered with, has and has had governmental relationships with the police force, the military, Ministry of Telecoms and then the Social Security Administration. So, even though that wasn't up for grabs for any of these unicorns to go after, we ended up getting it and it's -- these things happen in emerging markets we aim to create more defensive positions in a couple of other areas as well. So, I hope that long spiel of comment summed up what you're asking.

[Unidentified Analyst:]

That does. Thank you. My last question and start to a prolongate this was the NewCo of the Indonesian division. Now understand how many public companies are actually traded that do business in Indonesia? Do you know off your head? I mean, we know like you said Gojek is going to get public, SE, not many?

[Brent Suen:]

There -- okay, there's SE which is Sea Ltd. There's AGC which is the ticker symbol for the SPAC that Grab is going into. Gojek and Tokopedia are merging together and they're in late-stage negotiations with a certain SPAC of whom I know very well. FinAccel just came public through a SPAC last month. I also know that their IPO discussion is going on with all the major investment banks and we will probably see another two or three come out before the end of the year. There's also a number of companies that are listed in Singapore and in Indonesia. So, there's not a lot, but there's about to be more. One thing I can say is that their valuations that are coming out are all multi-billion dollars in size. So, maybe that opens things up for us being a micro-cap and investors on the retail side, go wow, I'd rather invest in something at $100 million than $40 billion, so we'll see. But we're really excited about it.

[Unidentified Analyst:]

No, thank you.

[Brent Suen:]

Thank you. Awesome.

[Operator:]

We'll take our next question from Christian Galatti from Phase IV Research. Please go ahead.

[Christian Galatti:]

Thank you for your question. My question at the very high -- at the very end of the press release, it says that there's a potential for 55 million or let's say 50 million to 75 million. If everything goes right on the data logic side, and if you could just kind of expound or talk about how that could work, or what kind of deals it would be.

[Rod Granero:]

Okay, cool. And I'm actually glad you asked that because I like to talk about it a lot. But what's the whole ready SD thing and what I'm supposed to say or not supposed to say? I actually want to talk about it. So thank you. Okay. So organically, we haven't come out and given guidance as you know, being an analyst. But I think in terms of targets from the existing business as is, what we like to target for next year is somewhere around the $40 million mark, and I hope I'm not putting too much pressure on my teammates out there. And with that, I think what Tom was referring to earlier on the margin side, being in the low 30s, Tom is very conservative, which is great. We have accumulated push Rebel and Fixel through M&A. During the process, we have seen other companies that are in the space. Some of them are very big. Some of them are medium sized. Some of them are smaller, and there's a number of them that our revenue being profitable that would be a great fit. We were looking mostly for defensible IP. In the recent initiative that we've undertaken is, let's go after some creative revenues and even EBITDA we see it, so we really stepped that up and on a daily basis, Christian, we're having one to three calls a day. I went to Chicago last week and I met with two companies. And we liked both of them. They're another more -- there's more than 20. I'd say we like all of them. We'll probably end up doing business with most of them. But there's a good number on there that would be great merger acquisition candidates. So, I think that targeting another call it 10 million to 35 million in a creative acquisitions that we can pick up at an attractive valuation, given where we are in the pipeline, and given the speed at which we're moving is very doable. It's very doable. So I think…

[Christian Galatti:]

Is a benchmark helping you as organic? Is it a mix of introductions? How is that kind of landscape being introduced to you? So you could take advantage of faster kind of roll up revenue growth? Go ahead.

[Rod Granero:]

Glad you asked. Benchmark is helping us and so are 11 other groups, whether they specialize in software and SaaS sell side representation, or they are brokers on the business side or they are friends of mine and Tom and Hague and John's from Silicon Valley or Silicon Alley, or Hong Kong. Their targets are plenty and there are introducers of plenty

[Christian Galatti:]

Thank you. Looking forward to the split. Thank you for your time.

[Rod Granero:]

Cool. Thanks, Christian.

[Operator:]

We'll take the final question in line from Tony Forte, a Private Investor. Please go ahead.

[Unidentified Analyst:]

How are you, Brent?

[Brent Suen:]

Hey, Tony, how are you sir?

[Unidentified Analyst:]

Great. I think this was the best conference call you've had since you've been doing these things. Excellent presentation.

[Brent Suen:]

Thank you. Thank you because I thought I was cringing.

[Unidentified Analyst:]

I know that you're doing everything possible to enhance shareholder value. And I know that you don't have to really answer this, but I know the problems inherent in the any of your offering in terms of what they did to how they placed the stock and what they did to the price as a result of placing the stock in those hands over the last four and a half months. I assume that if you do a public offering on DataLogiq, you probably will not do it the same way. You don't really have to answer that. The other thing…

[Brent Suen:]

No, you're right. You're right. We will not replicate that.

[Unidentified Analyst:]

The other thing I want to mention was that I know you're talking about the possibility of spending with AppLogiq. I know you're also talking about the possibility of doing a new public offering in DataLogiq, I also assume you might even have other alternatives. Do you have a personal feeling about the way you want to go?

[Brent Suen:]

I do. I do. I think that what we learned in the NEO IPO route is that we cannot put our -- we will not put ourselves in a position where we are either beholding to or at the mercy of certain arbitrage viewers or hedge funds that prey on micro cap stocks. And at the same time, I think that what's happened recently with all the introductions we've gotten is we've met some very capable people on the investment side and the advisory side that I think can create a lot of value with us whichever route we go. So I've been…

[Unidentified Analyst:]

You expect to make a final decision within the next week or two?

[Brent Suen:]

I think you're going to see some things happening in that timeline, yes.

[Unidentified Analyst:]

Okay. Well, thanks very much and great job today.

[Brent Suen:]

Terrific. Thank you. Thanks Tony.

[Unidentified Analyst:]

Okay. Bye-bye.

[Operator:]

At this time, this concludes our question-and-answer session. I would now like to turn the call back to Mr. Suen. Please go ahead.

[Brent Suen:]

Thanks Adam, and thanks everyone for bearing with me. I hope that wasn't too arcane. But that's how I feel and I think everyone deserves to hear that. It's been really frustrating. And at the same time, it's been incredibly exciting to see the opportunities that are coming up in the things that we're pursuing right now in the way that our teams are executing. And I absolutely believe that over a short period of time, we will reward everyone's patients. So with that, I will start to read the script and tell everyone we had a very strong third quarter, highlighted by the fact that we have finally pivoted back to year-over-year growth after emerging from the severe impact of the global pandemic. We believe this reflects how we have established a stronger foundation for addressing the abundant ecommerce opportunities worldwide for the rest of the year and beyond. We look forward to keeping you updated on our progress. And in the meanwhile, please feel free to reach out to us with any questions or thoughts you'd like to share. Thanks, everyone. And Adam, if you want to go ahead and wrap-up the call, that's great.

[Operator:]

Before we conclude today's call, I would like to provide the Company's Safe Harbor statement that includes important cautions, regarding forward-looking statements made during today's call. Statements made by management during today's call may have contained forward-looking statements within the definition of Section 27A and the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934 as amended. These forward-looking statements should not be used to make an investment decision. All statements, other than statements of historical fact included herein, are forward-looking statements, including statements regarding the continued growth of eCommerce segment and the ability of the Company to continue its expansion into that segment, the split of AppLogiq and DataLogiq into two separate publicly traded companies, including the structure of such transaction, the ability of the Company to attract customers and partners and generate revenues, the ability of the Company to successfully execute its business plan, the business strategy, plans and objectives of the Company and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology, such as believes, expects, hopes, intends or similar expressions, and involve known and unknown risks of uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks, and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this conference call. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressively qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume any duty to update these forward-looking statements. Before we end today's conference call, I would like to remind everyone that this call will be available for a replay starting later this evening. Please refer to today's press release for dial-in replay instructions available via the Company's website at www.logiq.com. Thank you for joining us. This concludes today's conference call. You may now disconnect.