ASX:SWF Emergence 2019 - Trade Smarter, Every Time - SelfWealth
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Trade Smarter, Every Time
ASX:SWF
Emergence 2019
Discussion outline SelfWealth overview - History - Profitability drivers - Results and trajectory - Key initiatives ETF business launch Investment opportunity
Who is SelfWealth?
▪ SelfWealth (ASX: SWF) is an exciting FinTech pioneer – providing investment solutions to
Australian self-directed investors
▪ Investment solutions are unique - driven by data and crowd intelligence
▪ High-value community of 60,000+ portfolios provides members with invaluable insightsinto
peer portfolios, including holdings, risk and return relative
▪ Leading the market as Australia’s lowest-cost, flat-fee ASX share trading provider
▪ Currently launching the SelfWealth Adviser Portal (SWAP) - a platform for financial advisers to
access cost-saving tools and the famous low-cost brokerage (currently in Betarelease)
▪ Entering the ETF market – launch of unique, high performing portfolio built on the best of SMSF
investors, seeding terms for $100m investment agreed with ETFS Capital (GrahamTuckwell)
3
Groundwork is complete – accelerating growth
SelfWealth platform reflects 5 years / $15m of investment
2012: 2014: Introduced Sep 16: Launch of
Ron Lesh (BGL) seed unique re- SelfWealth trading Jan 18:
investment balancing and platform and first trade execution
managed account 2015: ASX trade revenues May 17: shifted
SelfWealth established - functionality execution added Mobile App
(Pershing ) FTSE/Russell SelfWealth launch Dec 18:
A$2.3m cap via ASSOB
200 Index launch ~$1.5m placement
2012 2013 2014 2015 2016 2017 2018
Mar 17:
SelfWealth
2013: BGL 2015: Washington H PREMIUM offer
Strategic agreement - Nov 17: IPO Dec 18:
Soul Pattinson officially released
incorporating ASX listing (SWF) SELF ETF seeding
introduced to the
SelfWealth into BGL’s $7m raised terms with Graham
register
SMSF cloud solution 60% via Tuckwell announced
SelfWealth users
Target marketing for
Technology, systems and infrastructure development, testing and launch
customer growth
4
SelfWealth’s unique premium investor product
▪ Benchmarking against other investor portfolios - holdings, risk adjusted returns
WealthCheck & SafetyRating
▪ Community sentiment / actions on individual stocks
5
Business model - revenue
Current Key drivers
Premium Membership
Interest on Cash ▪ Customer acquisitions
Trades
Balances
▪ Activity levels
▪ Flat-fee $9.50 / trade ▪ Unique investor ▪ Income from client ▪ Premium members
toolset cash accounts (ANZ)
▪ Price leader ▪ Client cash balances
▪ $20 per month ▪ NIM ~1.7%
Imminent ▪ ETF Marketing
▪ Business Development
SelfWealth Adviser
ETF Revenue
Portal
Future ▪ Feature development
Margin Lending Data Licensing
6
Current
Imminent
Future
6Investment Platform Performance
Current State of Play
Our Business Validation Recognition
Market Leading $9.50 Flat-fee 10,000+, 87% up on July
Brokerage 2016 Winner
Active Trading Members
Optus My Business Awards
Fintech Business of the Year
2 x Money Mag Winner
Cheapest Online Broker
Highly Valuable Peer Investing A$745m
Community Total value of client HINs (Jan 19)
2017 Finalist 2016 Finalist
Fintech Business Awards Ifa Excellence Awards
Innovator of the Year
Increasing Traction in a Growing A$72m Investment Innovator of the Year
A$1.7bn+ Market Total client cash holdings (Jan 19)
Strong Team Executing on a Clear Plan +115% Trade Growth 2016 Winner
Australian Business Awards 2016 Finalist
Software Innovation Benzinga Fintech Awards
Current financial year
9
9KPI Traction – Member Holdings and Revenue
Member Securities and Cash Holdings ($m) Quarterly Revenue ($'000s)
60% growth of cash holdings, current FY 130% growth in revenue, in current FY
$72
$61 522k
$52 $56
$62
$47
$45
$741 $745
$663 $678
$648 $300k+
$618
$552
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19
FY 19 Q2 FY 19 Q3 to Date
Holdings Cash
10KPI Traction – Active Traders & Trades
Total Active Traders Total Trade Volume
88% growth, current FY 115% growth on monthly trades, current FY
10,058
9,369
8,721 34,029
7,875
6,965
6,236
5,360
20,000+
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 FY19 Q2 FY19 Q3 to Date
11Winning market share
2% of online market, capturing 15% of contestable pool
Price Comparison of Online Traders Online Share Trading Market
Our low-cost, flat-fee brokerage continues to beat competitors…
10%
Trade Size SelfWealth Comm Sec ANZ Bell Direct 3%
3%
< $1,000 $9.50 $10.00 $19.95 $15.00 5%
$5,001 $9.50 $19.95 $24.95 $15.00
48%
8%
$10,001 $9.50 $29.95 $29.95 $25.00
$100,001 $9.50 $120+ $110+ $100
10%
$1,000,000 $9.50 $1,200+ $1,100+ $1,000
Note: Other brokerage costs based on the following companies – CommSec, ANZ, WBC, NAB, Bell Direct, IG Markets. 13%
Assuming one trade only (i.e. no volume discounts). Current as of March 2018.
CommSec ANZ Westpac NAB
CMC Macquarie Bell Direct Other
Source : 2017 Investment Trends publication.
12ETF - SMSF Leaders
NB: Launch of ETF on the ASX subject to due
diligence and regulatory sign off
SMSF Leaders ETF
SELF ETF
▪ First crowd-sourced portfolio using collaborative intelligence from SMSF investment portfolios
▪ An Australian representative ‘SMSF ETF’
▪ Sourced from a large SMSF data base (BGL Simple Fund 360), ~60,000+ portfolios and growing
▪ Act as a reference portfolio for 600,000 SMSFs
▪ Seeding terms for $100m investment agreed with ETFS Capital (GrahamTuckwell)
▪ Available upon final DD and listing on ASX
▪ Achieved over 450bps outperformance vs ASX200 (Sharpe 1.0) since inception Dec 14 (as at
October 2018)
SelfWealth will target the 600,000 SMSFs in Australia
✓ 1% Market Penetration of the $250 billion listed equity asset allocation is $2.5 billion
✓ SMSF investors dominate ETF investment
✓ This represents potential annual net revenues of $12 million
✓ SELF ETF will generate a major uplift in the core business (subject to successful launch)Investing in SelfWealth
Summary ✓ IIR research – 23c target
Available on our website at
http://investors.selfwealth.com.au/Investors/
✓ Quarterly cash burn falling rapidly
– marketing efficiency, and strong growth in trades
✓ Register much stronger
✓ New revenue streams imminent
- SWAP
- SELF ETF
16Disclaimer The material in this presentation has been prepared by SelfWealth Ltd ABN 52 154 324 428 (“SelfWealth”) and is general background information about SelfWealth’s activities as at the date of this presentation. This information is given in summary form and does not purport to be complete. Information in this presentation, including forecast financial information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information having regard to these matters, any relevant offer document and in particular, you should seek independent financial advice. All securities and financial product or instrument transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments and, in international transactions, currency risk. This presentation may contain forward looking statements including statements regarding our intent, belief or current expectations with respect to SelfWealth’s businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward looking statements. SelfWealth Ltd does not undertake any obligation to publicly release the result of any revisions to these forward looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside SelfWealth’s control. Past performance is not a reliable indication of future performance. 17
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