NowVertical Group Inc. (5XQ.F) Earnings Call Transcript & Summary

The purpose of today's presentation is to give our audience a better understanding of the business, and then we'll take questions with management. The presentation is going to be led by Sandeep Mendiratta, CEO, who is also joined by Christine Nelson, CFO; and Andre Garber, Chief Development Officer. Also joining me today is Stefan Eftychiou with Bristol Capital. You should see the presentation in the room in the Zoom webcast. If you'd like to get a copy of this deck simply e-mail me at [email protected]. We'll break for questions at the end of the formal remarks. [Operator Instructions] I will not read the forward-looking statements, but I do state that they apply and I reference them on Page 2 of this presentation. With that said, once again, thank you for joining us. Remember, this is fairly informal, and we do encourage questions to help you better understand the business and its growth path. And now I'll turn the call over to Sandeep to start his part of the discussion and presentation.

Thank you very much, Glen. Welcome, everyone, to this webinar of NowVertical. Where Christine and I would like to take you through the journey that we are on and what kind of exciting things are happening within NowVertical, what's our growth story, some of the key metrics that we would love to share with you and how incredible they are, how this journey is evolving basically. Fundamentals first, what we do for our clients. We help our clients transform their data into tangible business value, and we do this with data and AI. We do this really fast. We transform this data with 600-plus strong teams that are operating in 2 markets. That's how we are structured. The 2 markets that we operate in are North America and EMEA and the Latin America market. We focus on bringing in the scale from some of these hyperscalers like the Google Cloud, Microsoft Azure, AWS, some of the niche data platforms like Snowflake and Anaplan, and we also work with Qlik, who were the pioneers of the visualization platform. These are some of the key technologies we leverage when we deliver these solutions and services for our clients and when we are transforming this data into tangible business value for our clients. What is incredible is the portfolio of large enterprise clients that we have on board. These are some of the clients Adobe, Sky, Disney, the Economist, Informa, Palo Alto Network. They all come from various industries, but primarily from financial services, technology, media and entertainment, energy sector. These are some of the industries that we focus on. What this focus has translated into is some of these key KPIs or the metrics. As of Q3 2025, our year-to-date revenue is $27.7 million and our EBITDA is $5.4 million. This is just a proof that our operating model produces strong margin even as we go through the transition into the next phase of our growth. Our top 30 strategic accounts have delivered $19 million revenue year-to-date. That healthy concentration on large long-term enterprise clients is our key differentiator and we will talk about this a lot more. And it's why we can confidently say that we can transform data into business value fast. So what's the market opportunity and how we are positioned in this market? So very first thing here is generating artificial intelligence ROI is quite complex. And we have seen this in multiple layers where the organizations in their own processes, how they struggle with their data, their technology as well and how it is becoming more and more difficult for the enterprises to deliver that ROI on their own. At the same time, we also know that these enterprises are going to be spending about $125 million to $170 million per annum on the solutions and services that bring the appropriate return on investment on these AI solutions and the technology. Over half of the executives are expecting returns in just next 3 to 5 years. The expectations are surging quite significantly. So what's happening is because of this demand, they are turning towards these third parties and the third parties likes of say NowVertical, what our business is, and they are looking for that support. And that support has doubled in the last 2 years itself. So why it's complex to deliver this ROI? First of all, most enterprises we work with struggle with the same symptoms. We see this all the time with all of our clients. Their data is fragmented. The governance is quite inconsistent. Their processes are quite manual and the systems cannot scale. The scalability is very poor. This makes it -- this is the reason and these are the symptoms that make it incredibly hard to realize any return on their AI investment. What they aspire to be is completely opposite, though. They want -- and these are some of the characteristics of the modern enterprise and what data standards they want to carry in their business. So first of all, they want to be automated and efficient. They want to have those trusted intelligence flowing through the organization and the agility to innovate at scale. In other words, they want AI impact at scale and not just experimentation. That's where our solutions and services come in. We work in 2 layers. First, we ensure that data management and governance is right, consolidating and cleansing data, so it's AI ready. And this is how we enable AI by building and operationalizing the machine learning models and integrating them with our clients' system. That's the foundation work with all the data operation that we deal with and we work with for our clients. Secondly, we apply the AI. Once the data is structured and it's ready, we apply AI in the most critical business functions. They could be in the marketing, they could be in the sales, customer service and finance. This is basically to drive measurable improvements. So these are the 2 layers that we really work on. And on the screen, you can also see how these 2 layers interact. The data management feeds the enabling layer, which feeds the application layer. And it's an orchestrated process that transform raw data into the actionable intelligence. And we don't do this alone. We are premier partners with Google Cloud. We'll talk about this a little bit more. We are also partners with Microsoft Azure, AWS, and like I said, some of the other very niche data platforms like Snowflake and Anaplan. We also focus on the most critical assets and the most important assets, if you like, within the enterprise, which is the customer data and the finance data. What this does is our solutions and services then deliver these real business outcomes like for Read Exhibitions, we have been able to uplift their revenue from the exhibitors by 11%, very tangible business outcome. And for Palo Alto Network, which is very large technology sector company, we improved their partner effectiveness by 50%. These are not just theoretical models. These are tangible business outcomes that we are delivering for our clients. And this is where I was talking about, this is the differentiator that we create when we work with our enterprise clients. Just a little bit of a history about NowVertical. We grew out of acquisitions. We acquired about 12 companies in a very short span of time over a period of 3 years. And as you can imagine, all these acquired companies had mixed profitability. They were all operating within their own regions and with their own strategy. And of course, they had very limited scalability because they were just operating on their own with their own strategies. We have evolved from an acquisition roll-up business to a sustainable growth engine. This is where we brought in our One Business, One Brand strategy that has -- this approach has that unified approach towards bringing all the teams and the platforms together, these acquisitions together, which has then improved our execution and the client experience also. While bringing all of these acquisitions together, we also cleaned up the balance sheet and strengthened the income from operations, which is one of our key KPIs. And this gives us the flexibility to invest and position us for the next stage of the expansion. What I would also like to talk about is the 3 key pillars of our One Business, One brand strategy, which we are developing and these are the foundation of our strategy as well. First of all, the strategic accounts. What do we mean by strategic accounts? And like I said, we have delivered $19 million revenue year-to-date from the strategic accounts. These strategic accounts, what we mean by them is they are large multibillion-dollar companies that we work with. But it's not just the scale and the size of these clients, it's also the type of business they bring us. It's the solutions and services that we can deliver for them. It's the value that we can offer to them. That's also quite critical. So these 2 combination of things, which is the size of the account, which are the enterprise accounts and what kind of business they are bringing to us, that's what makes us -- makes these accounts as the strategic accounts for us. We expect these strategic accounts to be delivering $1 million of revenue for us a year. It takes a while for us to grow these strategic accounts to that $1 million revenue, but many of these accounts have already delivered more than $5 million of lifetime value for us. So that's the gravity of these strategic accounts for us. Many of these strategic accounts have got more than 5 years of tenure. So that's the longevity that we have on these strategic accounts. Currently, we have got more than 100 enterprise accounts on our portfolio, but we are focused on developing and growing 30 strategic accounts. And we will talk a little bit more about what are those characteristics, what kind of growth stories are we developing out of these strategic accounts. The next pillar is the technology partnerships. And we will talk a little bit more about the Google Cloud partnership that we have developed. First of all, these technologies, the technology partners, we leverage their technology in the data and AI space, where we bring in these high-value innovative solutions to our strategic accounts. That's the importance of these technology partnerships for us. The key thing is these strategic partnerships or the technology partnerships, they refer the enterprise clients to us, which we then develop into strategic accounts over a period of time by bringing those high-value solutions and services to them. And this, in turn, creates that reliable revenue stream, which is mutually beneficial for both the technology partners like Google Cloud and for us, of course, as we build these strategic accounts from these enterprise clients that they refer to us. The third pillar is the integration. Like I said, we acquired 12 businesses. What we wanted to do under this One Brand, One Business strategy was bring in the synergies from all these 12 acquisitions that we have brought together. How we do that is by primarily cross-selling and upselling all the key solutions and services that we have created into our proposition catalog. We have also brought in a lot of delivery efficiencies by bringing India and Argentina as our delivery powerhouses and creating that seamless delivery mechanism and engine between those 2 countries. This has also translated into improved profitability, both in gross margins as well as the EBITDA for us, which we will share in a second. One of the things that we said early on when we brought in this One Brand, One Business strategy is we will convert everything into one single brand. And what I'm also pleased to announce is that all these acquisitions that we have now consolidated and integrated, we are now on one brand, one website. Back office has already been integrated for the whole market to our clients, to our partners and to our employees, we are now operating as one single NowVertical brand. Let me give you one real-world example of how these 3 pillars are helping us expand within our strategic accounts. Bayer, as you know, which is a multinational company, multibillion-dollar pharmaceutical and health care business, headquartered in Germany. our initial engagement with Bayer was only in Chile, in Latin America, and it was limited to reselling the Qlik licenses. We now are delivering services to them from Argentina. We have opened up new relationships in Colombia. We are working both with business stakeholders as well as the IT stakeholders within Bayer. And majority of our revenue now comes from the GCP or the Google Cloud-related services. And this Bayer account has turned into one of the top strategic accounts as well for us, and it's part of the top 30 strategic accounts. This is what the focus on these 3 pillars has brought to us and developed us into such a growth trajectory and giving us that impetus to grow further. These 3 pillars are maturing very nicely, and we are already steering us -- these are already steering us towards a higher-margin recurring revenue base, and I'm really delighted how they have come together. I'll come back shortly for any of the questions as well. But first, I'm pleased to hand the call over to Christine to walk us through our growth story and share some of the metrics as well. Christine?

Thanks, Sandeep, and welcome, everyone. I'll now walk you through how these key pillars of growth are translating into real results. And just a reminder that all the amounts referenced in this whole presentation are based in USD. So one of our key revenue KPI performance measures is the growth of our top strategic accounts. So these strategic accounts are enterprise companies, many of which are multibillion-dollar companies. And so as you can imagine, these come with large budgets with huge opportunity for growth, which we have proven. Our top 30 strategic accounts have grown 23% year-over-year, reaching 69% of our total revenue. This translates to about $846,000 in average account size over the trailing 12 months. Also, 10 of these strategic accounts have now actually exceeded over $1 million in spend over the past 12 months compared to only 3 in the prior year. How are we growing these accounts through the cross-selling and upselling, capitalizing on our technology partnerships and thirdly, of course, our efficient delivery model. This 23% growth highlights that our underlying core business is strong, driven by the growth in our top strategic enterprise accounts. Another key pillar of organic growth is the focus on our technology partnerships. And while we are growing all of our technology partnerships, our relationship with Google has been a key specific driver of growth over the past year and is something we just want to highlight. We have grown our GCP partnership revenue by 42% year-over-year. So back in 2024, our Google partnership was primarily concentrated in Argentina. Now we have focused on our integration and integrating that partnership globally. So it has grown across LATAM into North America and EMEA. This has given us new leads, new clients and of course, the ability to upsell and bring new innovative solutions to our clients. For example, so far this year, Google has already brought us 19 leads. We also now have 3 specializations with Google, data analytics, machine learning and of course, the ever so in demand GenAI. We are incredibly proud of how fast we achieve these and the fact that we are only 1 of 15 partners that have these GCP credentials worldwide, like globally. And on top of that, we are a Google Premier partner in North America and EMEA as well as LATAM. And of course, we won GCP Partner of the Year in LATAM earlier this year, which we're incredibly proud of. The next and third key pillar of growth has been the integration of our global business through the One Brand, One Business strategy that Sandeep mentioned. Integration means leveraging our global positioning to win new opportunities, growing our technology partnerships globally and capitalizing on our global technical expertise and efficient delivery powerhouses in Argentina and India. So how are we measuring our integration growth? So we measure it by how much are we cross-selling and upselling within our clients, net new technology partnership revenue and utilization of our efficient delivery cost centers globally and how much we're utilizing those globally. So overall, we've seen an 82% increase in integration revenue year-over-year, going from about $1.9 million last year to $3.4 million this year. And we're incredibly proud that this is now 12% of our total year-to-date revenue. Now that we are a globally integrated business, we're able to offer our clients more solutions and services from one part of the business to another, capitalizing on our global positioning and global technical expertise. For example, we recently closed a contract valued about $1.3 million in Argentina, which is fantastic. But one of the big reasons we were able to close this was our ability to leverage on the capabilities and expertise that our Brazil team can offer. So without that integration of our workforce, this wouldn't have been possible. Our technology partnership integration has also enabled us to upsell existing clients that did not previously engaged with us for the GCP delivery. For example, we have a big media enterprise client in North America and EMEA, which is one of our strategic accounts. We've worked with them for a number of years, has a lifetime value of over $5 million. But for the past few years, we were able to win on their GCP contracts. Now that we're a premier partner, we're winning off them on their GCP delivery, increasing our footprint, growing revenue. Another key foundation of integration is being able to service our global clients with our efficient delivery powerhouses in India and Argentina. These delivery centers are increasingly servicing our North America and EMEA market. Not only does that allow us to maintain high best-in-class gross margins of around 50% quarter after quarter, it also allows us to win certain contracts and accounts that otherwise just would not have been possible. Tying these 3 key pillars of growth all together, we're really starting to see a multiplying snowball effect on growth. As we focus on our technology partnerships globally, we see an increase in our strategic account revenue. We also see potentially new strategic accounts coming through leads from our technology partnerships. And then as we focus on our strategic account growth, we're seeing the positive impact that has with our technology partners. So each of these key pillars are benefiting each other, creating a strong foundation for a snowball effect on revenue growth going forward. And as we're globally seeing increasing demand for GenAI expertise, companies wanting to onboard technology quickly, we intend to capitalize on that demand and utilization this foundation has created and growing that snowball impact. Next, I will give just a financial overview of our recent Q3 year-to-date results. So while we dealt with some unexpected macros this year, we are still delivering $27.7 million in revenue year-to-date. We have grown our EBITDA by 17% to $5.4 million year-over-year, and we have grown our operating income by 55% to $2.5 million this year. As mentioned earlier, we have seen some strong growth in our key strategic KPIs. Strategic account revenue is up by 23% to $19 million. Partnership revenue is up by 42% to $3.9 million. Integration revenue is up by 82% and of course, our year-to-date gross margin and EBITDA margins are both best-in-class at 49% for gross margin and 20% for our EBITDA margin year-to-date. One big focus of management for the past 2 years has been cleaning up our balance sheet. And we've made incredible progress in reducing our cash obligations. As of Q3, we have reduced our short-term liabilities by $4.7 million since December of 2024. Also in October, we completely paid off our convertible debentures, removing a potential dilutive issuance of shares if the convertible notes have converted, all of which is setting us up for success in 2026. In 2025, and this includes up until the end of this December, we will have cleared up over $8.9 million of acquisition and long-term debt obligations this year. So next year, we'll only have $2.8 million of acquisition and debt obligations. This is a 69% decrease and is fantastic for the business by reducing our nonoperational cash flow liabilities, we have increased capacity to fund our own future growth by investing in our sales team and looking at potential accretive acquisitions as well. So now back to you, Sandeep, for final remarks and the Q&A. Thank you, everyone.

Thanks very much, Christine. Just before we open it up for Q&A, I just wanted to summarize what are the key considerations for our investors. One is our strong enterprise revenue base. Like I said, incredibly proud of the portfolio of the enterprise clients that we have and how we are turning them the focus into the top 30 strategic accounts, on average, they are delivering $846,000 of revenue. And we have got more on our portfolio. We have got that global scalable delivery model that's delivering best-in-class profit margins, 50% gross margin and 20% EBITDA. These strategic partnerships that we are developing with the likes of Google, the position that we have, 1 of those 15 partners globally in the data and AI space. That is a super incredible position to have for our size of the business in the market. And what we also are differentiated by is by offering that business outcome, the focus that we carry to deliver the business outcomes are not just our technology. But at the same time, we have deep technical expertise on data and AI across many industries. And one thing that we all are very proud of is that the management team we have has been invested quite nicely, and we have developed our investment over a period of time and we now own 27% of the business. which is basically completely aligned with the shareholders and their objectives. With that, I'll open it up for questions.

[Operator Instructions] We do have quite a few questions in the queue already. So I'll just get going. Sandeep, how are you thinking about the overall macro environment for AI spending right now? Do you expect these high spending numbers to keep up for the foreseeable future?

I think if anything, these numbers are going to grow quite significantly. This is for the first time in the history of the technology evolution where we are seeing technology wave like the Agentic AI and GenAI which is not concentrated only in one part of the business. This is going to go across the business and every industry and how the industries and every business is going to leverage that is going to define what their future is going to look like. So although we are projecting $125 million to $170 million of investment per annum by these large multibillion dollar enterprise clients. This investment is only going to grow with the evolution of the technology. And in my opinion, we are at very early stages of this evolution of the GenAI and Agentic AI technology.

Can you dive a little deeper into your actual technology and how that might be differentiated from your competitors? What are you doing different? Or what are you offering different that your competitors are not.

First of all, if you look at this on the screen, like I said, our key differentiator is that we are focused on business outcomes. The couple of metrics that I talked about, there are so many different examples of those metrics. The ones that I talked about for Reed Exhibitions and Palo Alto Networks, we have got hundreds of those examples. And what that means and what that does is when we are business outcome focused. Everything else that we do upstream is very different than many of our other competitors who are focused only on a particular -- delivery of a particular technology. And this is what our clients have come back and told us that this is what they really enjoy in terms of the experience of our engagement with them and how they can then cherish the outcomes that we are delivering over a period of time. So this is one of the key differentiator, I would say. The second differentiator is the credibility and the credentials we have got with the technology vendors like Google. And what this does is positions us very uniquely when we go to the market along with Google when they bring us into these enterprise clients, just the experience and the credentials that we carry mean a lot and then it clears off our way from all the competition that may be there. That's another area. And this is -- these credentials don't come overnight. These are really wide and deep technology expertise that we have developed over many years. And these credentials also have many certifications and very strong center of excellence we have developed on these technologies. So that's some of the differentiators that we have in the market. Every business has to also think about how would they scale. If there is growth on the table, can we actually deliver that growth. And what we have also got is very nicely running delivery capability which is very scalable, and that's between India and Argentina, like we said. And what we have also baked in is hyper elasticity in that delivery model that we have. These are some of the key differentiators, I would say, which puts us in that top 1%, 2% category of the partners that these enterprise clients are looking for.

You've got a couple of case studies that you mentioned, and this specific question is, can you give some specific examples of problems a client has and how you solve those problems and add value for customers. So maybe use those or any others you could think of?

So just the example that I took for Reed Exhibitions, for example. Reed Exhibitions is a multibillion-dollar company they run about 500 events, the exhibitions and the conferences across the world. They operate in many different industries, operate in 30 countries, they bring in millions and millions of visitors or you call them as the audience to these shows. And 70% of their revenue actually comes from the exhibitors who come to these shows and they buy the space and they hold their stance and they are looking for the buyers there. The visitors are the buyers for -- from these exhibitors. So that's the business model. Their key objective is to create that matchmaking between the exhibitors and the buyers. That's why they exist in the market. What we have created is how do you ensure that the return on their exhibitor investment, when they are paying Reed Exhibitions for the space at these shows is really justified. And this is where we brought in our technology, our understanding, machine learning, AI models, all of the data structuring together so that we can understand what the buyers are really looking for and what kind of exhibitors are selling what products and create that matchmaking in such a seamless way so that it's very low friction. It's a very nice experience for the buyers who are coming there to meet with these exhibitors. And how can they identify who's the best fit exhibitor for me? When the exhibitors then see that, these leads that they are getting, the buyers that they are seeing, they are converting into proper business for them. That's the win for the exhibitors. And this is what we have done for Reed Exhibitions and many other events companies like Reed Exhibitions to bring in that matchmaking and bringing that effectiveness in that matchmaking between exhibitors and the buyers. And that's where I was talking about that 11% uplift in the revenue where the exhibitors have chosen Reed Exhibitions to come to their shows and pay them more over a period of time because of the value they have seen in meeting the right kind of buyers. That's just one particular example of how we provide that tangible business outcome and grow the revenue for our clients we work with.

Perfect. Then I got a couple of questions regarding the Palo Alto case study, maybe we could go to that now. What exactly is meant by improving partner effectiveness by 50%?

Very good question. I love to talk about this. So Palo Alto Network in the technology sector, technology sector has a very peculiar business model, where they rely a lot on the partner channel. So a lot of their revenue, in some cases, more than 60% to 70% of their revenue comes from the partner channel who then resell their products in the market because of their own positioning. Palo Alto Network and many other technology companies, they spend millions of dollars on marketing via the channel partners. What they fail to understand is, who are my right partners, what kind of leads and opportunities am I getting from various partners in the channel that they have hundreds of partners in those channels. Who are the most effective partners for me, who are bringing in the most meaningful opportunities to me, who are very effective in converting those opportunities into real revenue, how long are these partners taking to convert those opportunities? What's my effectiveness of spending those marketing dollars with these partners. And this requires so much of data points. This requires so much of analysis work and structuring all of that data across the whole pipeline of hundreds and thousands of the partners in that channel and ensuring that you understand every stage of that opportunity and the sales life cycle. That's what I mean by the effectiveness of the partner channel where you are measuring what is who are the best partners for me, what are the reasons under criteria for choosing those best partners and so that I can then move my marketing dollars in the most appropriate ways and they work for me. And that partner effectiveness, what was not at all understood very well understood by Palo Alto Network, and we have created those solutions, which are very reusable and repeatable solutions for the technology sector, which we are looking to amplify in the market now.

Super. Can you provide some examples of the types of AI applications you're delivering to your enterprise customers? What is the most prevalent applications and demand for AI enabling?

There are many of those, but we are focused more on the customer and the finance data and any of the use cases that are driven by customer and finance data primarily, like we said, that's our specialization. Just to give you some examples, customer services, it's a very common example. Every enterprise wants to really become very efficient with their customer services. And that's where they see a lot of demand and the need for scale. So think about hundreds of customers coming up with any of their queries via various channels. It could be social media. It could be e-mail, it could be website. It could be third parties. It could be phone calls. It could be many of -- it could be WhatsApp. There are so many different channels that you have got and enterprises, they really struggle to understand which customer is coming from what channel and what has been the history of interaction with those customers. Doing it manually or infusing that into every interaction touch point with different technologies that they have deployed makes it even more complex. So one of the AI solution that we have is to really automate all of those processes and bring it all in one place so that they get to see the 360-degree view of their customer. No matter where the customer is coming from, they can understand that customer instantly. If they are coming from, say, website channel, if they are coming from social media, if they are coming from third party, if they are coming from whatever the channel may be, they can really understand instantly what that background and the history and the behavior of that customer has been, is that a high-value customer? Is that a medium value customer? Is that a low-value customer? Is that a new customer? Is that already a troubled customer? And then you offer the right kind of experience to that customer by joining these thousands of data points using the AI technology that has made it very easy and very efficient, cost-effective to interact with the customers like that. And that then can scale across the whole customer services platform. So that's the -- that's just one of the use cases where we have been able to just condense all of those customer services interactions into one solution. Marketing, marketing department is another very good example. How do you personalize every interaction with the customer, whether they are at -- before the acquisition of them before they even become paid customer for you. Or they are your customer for the last 6 years, and they have been interacting with you on many different channels through the last 6 years or so. Personalization, targeting them, understanding their behavior, understanding their preferences, understanding the change in the behavior over a period of time that, again, requires you to collect hundreds and thousands of data points and be very accurate almost making them feel that you care about them so much you understand everything about them and then you offer the products and the services and the experience based on their preferences. This is where a lot of the AI solutioning is happening, where we are bringing all of these data points together very efficiently by using the AI technology, which was very expensive earlier to do, and it was very time consuming but AI is making it so much easier and it's self-learning, it's automating all of these processes and offering that personalized experience to the customers.

I guess I've got a few questions around this topic. So I'll just try to generalize it for you. And the general comment is you've got 30 strategic accounts, what -- and they're doing approximately $1 million a year. That represents a $30 million business. So help investors understand how you scale within the existing account and what an actual -- a strategic account in terms of total dollar spend over the lifetime of working with you means to you as an organization.

I can talk about this for whole day. But this is such a great topic, and this is what we have been developing as a differentiator and the strength, if you like. Just to give you an example of our top-notch client, if you like, has delivered more than $25 million lifetime value. And that's not all done. We are still working with that client and that lifetime value is going to grow over a period of time. Many of our accounts have got more than $5 million lifetime value. The journey begins with a very small engagement. Our initial engagement with these enterprise clients could be anywhere between $50,000 to $150,000. And it could be 4-week engagement, it could be 6- to 8-week engagement back initially, where the clients bring one problem statement to us and we advise them, we consult with them. We go and discover things for them and we envision the road map, the target operating model for them. We give them the pathway. We show them what's possible really within their business and how we can help them scale their revenue, solve their problems, achieve their goals, achieve their objectives over a period of time. Once they see what is -- what's possible with the technology that we bring to them then begins the next phase where they bring us in to say, okay, prove it to me that you can really deliver this particular use case for me based on what you have said. That engagement could be say anywhere between $100,000, $0.25 million to even $0.5 million. That could take anywhere from 3 months to 12-month period. But that's the litmus test. That's when the clients say, okay, I understand what you said you are able to walk the talk and you have been able to deliver tangible business outcome to me. That's when the flood gates open for us. Once the client is convened and they are confident in the delivery that we have shown them in the business outcomes we have delivered. After that, they could be opening up tens of use cases. We could be going from 1 department or 1 function like marketing to customer services, to sales to finance we could be going into different business units. We could be going across different geographies because these are all multinational global businesses. So that's how the journey begins, very small. It could turn into -- prove that one use case and then go and deliver complete scalability within the business. And that's how we go from, say, $100,000 initial engagement to multimillion dollar revenue for us in a year. That's what an engagement or a journey with strategic accounts look like. And this is not just one particular example. There are multiple examples like that. All of our 30 strategic accounts are going through this journey. They are in different phases of the journey. Some of them have been there with us for 3 years so far, some of them more than 5 years. Many of them are also more than 8 or 10 years with us. So that's the typical journey that we see and this is a repeatable, reusable journey, and we have created the framework to focus on these strategic accounts and expand them.

And I guess sticking with this theme, can you comment on how much incremental revenue that you sense you can generate from your partnerships with the Google Cloud as they ramp GenAI.

Most of the opportunities that we are getting from Google Cloud now are on that data and AI teams where some of the clients are looking to experiment. Some of the clients have failed. They don't know how to approach this journey. They may not have the right skill sets. They may not have the right tools and the technology they may not have the right organization structure in-house. And they, of course, do not have experience in delivering these kind of outcomes with AI technology. So a lot of these opportunities that we talked about and Christine also referred to those 19 opportunities that we got from GCP, they are mostly the theme -- the underlying theme there is on data and AI. Many of them on Agentic AI and GenAI technologies. Majority of our clients, they come into the experimentation phase, either they have failed or they have not even understood how to deliver this particular road map. And that's where we get engaged with them. And many of our clients now are going into the scaling of those AI solutions as well with us. So yes, a lot of the themes that we are getting and the opportunities we are getting is with that AI theme.

How does the business model scale efficiently with top line growth? Given the correlation with headcount, how challenging is it currently to attract and retain necessary qualified talent.

Well, this is something that we have solved over many years. The businesses that have been acquired by NowVertical, they have been operating for -- many of them have been operating for 10, 15, almost 20 years as well. So this ability to acquire the right talent, nurture that talent retain that talent and cross-train that talent. That ability already exists, and we have scaled that ability. We have amplified that ability across the business. And that's why I said one of our differentiator is our global scalable delivery model that you see on the screen. That's between the Argentina and India, and that head count is pretty strong. We have got very, very low attrition in the business, way lower than the industry standards. And that's because we are working on those high-tech technologies, high-tech solutions, the talent that we have, they enjoy, how we are evolving the solutions and services for our clients as well. So this is one of the areas of the capabilities of the business that we are very strong in.

So to double revenues from where you are today, how much more CapEx and staff do you think you need?

With the Agentic AI and the GenAI wave, not a lot. What we will see in the future is without really increasing the head count in the same proportion as revenue, we may be able to double the revenue or quadruple the revenue over a period of time. But we may not have to increase our head count in the same proportion. That's the beauty of the Agentic AI technology. We are not just delivering the Agentic AI technology for our clients. We are also infusing that in our internal processes. So every time we are delivering these projects and engagement for our clients, these solutions and services we are delivering are becoming smarter and smarter, and they are all getting infused by the Agentic AI and the GenAI technology.

How exactly do partnerships work with GCP and others? Are you delivering the service using GCP or that specific service? Or are they just simply referring business?

No, we leverage their technology quite a bit. That's why we are the premier partners. One of the criteria for our premier partners is how much consumption Google sees from our solutions and services that we are delivering for our clients. So that partnership is mutually beneficial when we deliver our solutions and services, leveraging Google Cloud platform. Google Cloud gets the consumption revenue on that. And one of the key metric is that I should share here is for every dollar of the Google Cloud platform consumption, we get almost $8 to $10 of the services or the solution revenue. That's how to think about the scalability of it. That's why Google is interested in bringing us those leads because they know our depth and breadth on the technology and how we deliver those business outcomes using their technology. We also have that confidence because Google has got a phenomenal road map with their Agentic AI and the GenAI technology. And we believe their technology is also a differentiator and makes it quite easy for us to embed into our solutions and services and how we deliver those business outcomes for our clients. So very mutually beneficial relationship where we are leveraging each other's capabilities to bring that business outcome and the value to our clients.

I think this question maybe more for Christine, but I'll let you guys decide. As revenue scales, what is the expected long-term EBITDA margin range? And how much operating leverage is going back into the business? What percentage of your EBITDA is converting into operating cash flow or if you have a target?

Yes. Christine, do you want to take that and talk about our thresholds that we have on EBITDA?

Yes, sure. For EBITDA thresholds, we're really targeting best-in-class, which is about 15% to 20%. So right now, seeing a 20% is fantastic. As we mentioned, we're going to be generating more operational cash flow in 2026. Now that we have less -- we're spending less on our acquisition liabilities and our long-term debt, our cost of capital is decreasing. So we do expect to see a bit of a decrease in that margin as we invest in our sales teams over the next year or 2 years. But really, we're trying to stick to that target of 15% to 20%.

And also to continue along this line. With your revenue base remaining heavily skewed in Latin America, what specific contractual geographic or strategic changes are you implementing to diversify and grow this mix?

Our revenue is -- if you look at the overall revenue, yes, there is a 70-30 split, 70% revenue is coming from LATAM. But then when you start running it down into the strategic revenue that's coming from the strategic accounts, that's becoming more and more balanced between Latin America and North America and EMEA. We have, in North America and EMEA's, the average revenue from the strategic accounts is already crossing $1 million. And we've got that strong momentum already and the tailwinds that we are seeing for the solutions and services in North America and EMEA. What we also have now is the opportunity and the ability to start delivering more and more services from Latin America. And like we said, the scalable delivery model between Argentina and India, will be delivering more and more revenue that we will be delivering in North America and EMEA market and the clients that we are going to be onboarding and scaling. So over a period of time, it will become more and more balanced for sure. But we want to leverage all these technology capabilities and the expertise that we have acquired and developing and nurturing within Latin America. And it's pretty strong revenue that way with the strong technical capabilities that are underlying there.

Can you spend a little bit of time on the competitive landscape? And specifically, who would you consider your key competitors?

We come across many different categories of the competition, and we have done a lot of work around understanding these different categories of the competition. One is we come across the big 4, all of these top-tier consulting companies, the likes of Accenture, Deloitte, EY, KPMG, PwC, we come across them a lot. As you can imagine, our client base is the enterprise multimillion dollar brands. And many of these big 4s and top-tier consulting companies are also working with them. We win a lot against these big 4 as well. Even just in 2025, just rough numbers, we have on probably 5 large programs against some of these big 4 consulting companies and one of the reason one being against Accenture and NTT Data. We know where our niche exists, where our specialization exists with the customer and finance data specialization, understanding of the technology that we bring to our clients and some of the industry and domains like marketing, sales, customer service and finance functions that we focus on. We know if we are up against one of these large consulting companies then what's our pitch and what's our winning formula, we understand that really, really well. I'm not saying we win all the time against them, but we win a lot against them. Then we have got the large outsourcing companies, the likes of say Infosys, Wipro, Cognizant, TCS and all. And although they bring scale to the clients, they fail to really bring that niche, deep wide technology focus to deliver the business outcomes. And this is where we, again, win against the outsourcing large outsourcing style companies. Of course, we lose when the client is only looking for scale, and they kind of are compromising on the quality of the business outcomes that they get delivered. But we, again, understand very, very well where we operate and how to win against these large outsourcing companies and what our differentiator is. The third category is some boutique companies, local regional companies. We know when the enterprises are working with these regional small boutique companies, they cannot scale. They do not have the scale of NowVertical that we bring and the different variety of expertise that we can bring to solve these complex challenges around data and AI. So these are the 3 different categories that we come across, and we have defined very well-laid formula for each 1 of these category to win against them.

Can you talk a little bit about your acquisition strategy? And maybe first start by discussing the historical acquisitions and what you spent to acquire those businesses. And then as you go forward, what type of businesses are you looking to add, if at all? And what is the sort of focus between organic growth versus M&A growth.

Yes. Very wide question, I would say but...

I combined like 4 or 5 into that, so.

Historically, I think the initial roll-up strategy was to bring in these brilliant businesses that are in solutions, services and even the technology product space that we're focused on data and analytics area. So these phenomenal businesses have come together within NowVertical. Now what we paid for them was all kind of different areas and different specific situations where we pay different value for them. But they were all primarily driven by if you look at the framework for the acquisition or the deal structuring, they were all driven by what's their EBITDA, what's their profitability and then applying kind of a multiplier to them. And of course, when we were buying a business, how small or how large it is, how sustainable that revenue and EBITDA is all of that were considered when we acquired these businesses. Roll-up strategy works with a very different mindset. You first want to really gain that critical mass and that revenue and profitability revenue, our top line being the key factor, getting the right capabilities on board being another key factor. Now that we have consolidated all of those acquisitions, and we are One Business, One Brand going forward, our strategy is going to be a lot more focused in terms of how we can acquire a business and integrate that very quickly. Does it add that scale? And does it add -- does it complement the capabilities that we already have? Does it bring in more of the strategic account base to us that we can develop, expand into and turn them into multimillion dollar revenue accounts for us. We will be looking at those kind of things. And even, let's say, Google Cloud platform, is there another partner, value-add partner that we can bring on board, is there a Microsoft Azure partner that we can bring on board, who could be adding a lot more value to our business. So the focus is going to be a little bit different. And one of the key things that we are also focused on is ensuring that we can integrate that business right away. For example, we can integrate that business in the next 2 quarters and gain that organic momentum, organic growth momentum with that acquisition. In terms of the organic and inorganic growth, of course, the organic engine that we are creating is a very long-term engine. This is going to become that foundation of our business over a period of time. And creating that very healthy year-over-year growth rate that we can sustain over many years to come. That's our key agenda. What it will also see is as some catalyst is the inorganic growth, where we can keep adding on some of these value-add businesses like I described from time to time so that we get that step up in our growth journey. So that's the way to think about our organic and inorganic growth. Organic growth being the long-term foundational engine and inorganic growth offering that catalyst and just that step up over a period of time for us.

Super. Thank you. I guess I'm doing a time check, we're 3:00. So we've got a few questions still in the queue, but I think we've covered most of them in some way, shape or form. I'll maybe ask this one last question, and then I'm going to ask you for some closing remarks to end the presentation. So the last question is, as you sort of start to look at the company, what key indicators would you advise to monitor for the inflection into this sort of strategic sustained growth over the next few quarters and as you get into 2026.

I think the best way to look at it is the flywheel that Christine short which basically shows how we are growing our strategic accounts revenue, what we call as the strategic revenue for us. How are we going from making them as average $1 million, $1.5 million, $2 million revenue accounts for us on average. How we are converting that focus from top 30 accounts to top 50 accounts to top 100 accounts over a period of time, that's going to be one of our strategic KPIs for years to come. And how we gain that momentum, how we gain some of the catalyst into that while we are in this whole Agentic AI and GenAI evolution of the technology phase, that's going to be very interesting to watch what kind of growth rate we can achieve. So that's one of the key KPIs. The partnerships, the technology partnerships, GCP is just one of those partnerships that we have right now. There are other that we have got a lot of credentials with. There are so many other partnerships that we are also working towards which will again then give us multiple channels for us to catalyze the growth within the business. These 2 areas, I would say, are going to be the key factors of growth that can add -- keep adding that momentum to our growth rate. What we want to make sure is the foundation of our gross margin and EBITDA is sustained over a period of time. So these are the 3 areas of our measurement and the KPIs that we are absolutely going to be focused on. But these are the macro KPIs. Of course, from time to time as we are developing our growth journey, we will also have our micro KPIs that we are going to be focused on internally so that we can impact and influence those macro KPIs all the time.

Super. Thank you. I'll ask you for some closing remarks, and then we'll end the presentation.

I would say this is a very exciting time in NowVertical's journey. We have gone through a massive transformation of consolidating and integrating all the 12 acquisitions that we have had and that journey has been refreshing and very rewarding. It's rewarding to see where we are as a business and how this business has come together with the management team that's so committed and dedicated on the vision of the business. The interesting part is now beginning, and we are going to go through some more cycles of the transformation of how we commercialize this and how we capitalize on the position that we have created in the market. and then create that growth journey for us over years to come. And this is where we believe we are going to come across as those superstar consulting companies, superstar delivery capabilities that can compete with the best of these big 4s, like offs, Accentures and all and create its own differentiator in the market. by leveraging this Agentic AI and GenAI technology internally as well as externally. This is what is really exciting for us.

Super. Thank you, Sandeep. Thank you, Christine. And most of all, thank you to your audience. This concludes this presentation.

Thank you very much.

Thank you.