Orion Digital Corp. (ORIO) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by and welcome to the Mogo Q3 2020 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand it over to your speaker today, Craig Armitage, Investor Relations. Thank you. Please go ahead.

Thank you, Mike, and thanks for joining us today. Just a couple of quick notes before we get started. First, today's call will contain forward-looking statements that are based on current assumptions and subject to risks and uncertainties that could cause actual results to differ materially from those projected. The company undertakes no obligation to update these statements, except as required by law. Information about these risks and uncertainties are included in our Q3 filings as well as periodic filings with regulators in Canada and the United States, which you can find on SEDAR, EDGAR and our website. Second, today's discussion will included adjusted financial measures, which are non-IFRS measures. These should be considered as a supplement to and not as a substitute for IFRS financial measures. Lastly, the amounts today are discussed in Canadian dollars, unless otherwise indicated. And if this wasn't clear to people, we do have presentation slides available to accompany today's call. Those can be found under the Investor Relations section of the website. So with that, I'll turn the call over to Dave Feller to get us started.

Thanks, Greg. Thank you and good morning. Welcome to Mogo's Third Quarter 2020 Results Conference Call. I'm joined today by Greg Feller, our President and CFO. We're pleased to report another quarter of strong results in our key profit measures, including positive net income of $1 million, and a 346% increase in adjusted EBITDA. These results reflect the success of our efforts to quickly adapt to an uncertain environment this year, and really shine a light on the fundamental health, resilience and profitability of our business. In a world where many fintechs have unproven business models and no path to profitability, we have shown we do. I would also like to call out the team at Mogo for their great work in 2020. It's certainly been a challenging year in many ways, and the team has done a great job during these difficult times. And because of all of their hard work, we feel good about how the business is positioned heading into 2021. The adoption of digital banking, digital wallets and financial health are all powerful long-term trends that have accelerated in 2020, and Mogo is clearly positioned to benefit. We still have a lot of work to do and the team is hyper-focused on execution of our plan, and we're pleased with the things we are seeing, including an 89% growth in members from our previous quarter and a 237% growth year-over-year in Bitcoin accounts. Given the pandemic, along with the increased pressure on consumers' finances, the shift to digital continues to be in hyperdrive. The problem of financial stress has only gotten worse. It's clear that for most people, their existing banking solution doesn't solve their problem. So what does the next-generation banking look like? We believe it looks more like a gaming app than a banking app. We see gamification as one of the keys to winning in this space, and we're focused on making Mogo not only one of the best games to play, but a game that helps you get financially healthy and achieve your important life goals like getting out of debt, buying a home and saving for retirement. In fact, we believe this is one of the keys to solving the wealth gap in Canada. It's one thing to have a great product and it's another thing to have an engaging experience that makes it fun. The highest form of human motivation is doing things because they're fun, not just because they're good for you. As you'll see in today's presentation, gamification is a key element of our strategy and something we are proud to be pioneers of when it comes to personal finance. As you may have seen in the broader fintech landscape, players such as Cash App in the U.S. are seeing huge growth in demand for Bitcoin. PayPal also recently announced to its customers in the U.S. who will be able to buy cryptocurrencies, including Bitcoin directly from their PayPal account. While Canada typically lags the U.S. with these trends, demand is growing here, too. We are seeing it in our metrics. Mogo Bitcoin users are up 237% year-over-year. And in October, we're already seeing doubling from Q3 levels. What's more, we achieved this growth with little to no marketing around Bitcoin. As more and more Canadians look to participate in Bitcoin, we believe that Mogo is uniquely positioned. Unlike other crypto apps, we are only focused on Bitcoin, and we have a much broader value proposition. But perhaps most important is that we have the trust and credibility of being the only publicly traded company that offers everyday Canadians, a simple and low-cost way to buy and sell Bitcoin. We believe this can be an increasingly meaningful part of our member and revenue growth and are focused on increasing our focus on this product, including yesterday's announcement of our new Bitcoin rewards program as well as our new stacking sats campaign. Stacking sats is a term used to describe the active regularly accumulating small amounts of Bitcoin, also known as satoshis. We believe reward programs like collecting points and air miles are losing relevancy, especially among millennials and Gen Z, and Bitcoin is a perfect platform for a modern rewards program. There are 100 million satoshis in a bitcoin, which is a great structure for a rewards program. And unlike old school reward programs, satoshis offer the added benefit and excitement of being something that have potential to appreciate in value. If you are a gamer, you'll know that rewards are a key part of gamification. And we will now have a way to reward members for good financial behaviors as well as rewarding them for engaging with our products. We are starting off with rewards for improving your credit score as well as rewards for activating and funding your Bitcoin account, along with earning Bitcoin for referring friends to Mogo. This is just the beginning, and our plan is to bring this rewards program to all our products in a way that not only helps members improve their finances, but helps drive more engagement to all our products. We are excited about this new program. We believe it can be a meaningful driver of engagement, monetization and long term retention, similar to other successful reward programs. In order to participate, members must activate a Bitcoin account and download the Mogo app. Our free credit score offering continues to resonate with members, and our new rewards program helps to make it even more engaging. Every month, members will now have an opportunity to earn Bitcoin. Our credit score experience is evolving from simply monitoring someone's score to really helping them improve it, something that millions of Canadians are focused on doing. All members can now earn Bitcoin by achieving what we call Rockstar status, which is a credit score of 850 or above, something that only about 10% of Canadians currently have. We also have a category for most improved monthly player, i.e., the member that improves their credit score the most. This player can win 1 million sats, which is worth about $200. This now directly ties credit score with our Bitcoin account, i.e., to participate members need to sign up and activate their Mogo Bitcoin account. This new reward program is the only one of its kind in Canada, where Canadians who want to improve their score or simply just monitor it, can earn and win bitcoins, a truly differentiated and compelling value proposition. In Q3, we launched our new carbon offsetting feature for the MogoCard. This is the first card in Canada that helps you control your spending while also offsetting your CO2 as you spend and all for free. CO2 continues to be the primary cause of climate change and recent surveys show that it is a top concern of both millennials and Gen Z. Still early days in this new product, but we're very pleased with the initial results. We've seen a 66% increase in average spend per user. And this is especially impressive considering we took away a cash-back incentive and replace it with a more profitable carbon offsetting model. We're also excited about a new feature that we just launched called Rainforest Mode. Users who log into their dashboard, get to experience the sounds and even the visuals of the Amazon Rainforest. This brings our carbon offsetting project of protecting the Amazon Rainforest to life and creates a very cool experience. It also helps our members be more mindful around their spending. Think about it like a mindfulness app like Calm, integrated into our spending account. The initial feedback on this experience has been excellent. And it's something that until you experience it, you won't appreciate how impactful it can be. I promise you, this isn't anything like logging into your banking app and takes gamification and money to the next level. Also starting to get some really strong and positive feedback from users on how much they're loving this new experience. The market opportunity is massive with almost $1 trillion a year in spending happening between cash, credit and debit cards in Canada. We also believe that we will continue to see a shift in consumers moving away from credit cards towards the control of prepaid cards like a MogoCard, given the improved ability to control spending and avoid debt as well as the continued trend of moving away from cash and a prepaid card like Mogo is the equivalent of digital cash. Like our other products, we are also planning incorporating our new Bitcoin rewards program, beginning with rewarding new users for signing up and becoming active card users. Again, the goal is to reward members for becoming active users of our products while also helping them get control of their spending and financial health. As I mentioned earlier, free ID fraud protection launched in Q3 has been a key driver of helping us achieve a 79% increase in new member growth in Q3 versus the previous quarter. This is a must-have product for every Canadian as every one of us is a more at risk of ID fraud than ever before, as our lives continue to go more and more digital. And in fact, recent data shows that 75% of Canadians have had their data breached in the last 12 months. This is also something that you would have to pay about $240 a year to get from the credit bureaus. And Mogo is the first offer it for free. So if you haven't signed up for it yet, get on it. Today, there are about 20 million Canadians who are eligible for this product in the markets we serve, and we are currently protecting less than 2%, so lots of room for growth. To date, we've already sent out over 370,000 alerts, and 30% of our new members have received an alert in the first 60 days, and we're just beginning to hear from our members on how much they're loving this. Alerts let you know who has done an inquiry on your bureau, and it's here that you have a chance to stop ID fraud from mapping, i.e., stopping someone from getting a loan in your name. None of us can prevent ID theft, but we all have an opportunity to minimize the risk of ID fraud before it happens. And if you become a victim, it can cause a lot of problems, including preventing you from getting a mortgage or qualifying for a loan. We're also excited to see that given the nature of this product, we're actually seeing close to 100% retention rate. Lending is what our business was initially built on, and we believe remains one of our key strategic advantages. After selling our liquid loan book, we are primarily focused on growing loans through our partners. Our goal is to ensure we have a best-in-class loan offering across the full credit spectrum and expect partnership and referral models to continue to expand. The more we grow our member base and the more engaged these members are, the more opportunities we have to convert them into loans, which have great economics. We saw a 63% increase in partner loans to goeasy in Q3 over Q2. We're also planning on integrating our Bitcoin rewards program as another way to reward and incentivize members. This could also include earning Bitcoin for staying in good standing on their loan payments. Again, lots of opportunities to leverage this program. Another way we are monetizing members is through a partner referral program. During the quarter, we announced that we partnered with the EQ Bank to promote their industry-leading savings account. Although still early days, we have seen some really strong results from our initial tests with above-average conversion rates. Although not a primary focus today, this will continue to be something we look to grow and improve on and a great way to bring a broader offering to our ever-growing member base. As with our other products, we plan on bringing our Bitcoin rewards program to our referral product. So members can earn sats if they sign up with one of our partners. Our goal remains to secure best-in-class partners so we can offer best-in-class products to our member base. The high interest rate savings account from EQ is a good example of this, with rates that are up to 30x higher than other banks. We also recently announced that we were working on a new P2P product that we anticipate launching in the first half of next year. Although most Canadians have access to e-mail money transfer, the experience is a lot of friction and lacks many of the convenient features that the leading P2P solutions have in the U.S. market. We believe there's a big opportunity to bring this type of solution into the Canadian market and think that we are well positioned to do it. The road map for this product incorporates a lot more than just a P2P solution. There are many significant enhancements that are part of this plan and will dramatically improve the convenience of the Mogo app to our members and make accessing our other products a lot easier. This feature will also enable our card customers to do things like split the bill, so they can pay and have their friends easily pay them back. Lots of excitement internally for this new product, and we're working hard to bring it to life. We'll continue to keep you updated on it, as we move along. Perhaps the single biggest challenge for a startup in our space is customer acquisition. The reality is banks spend hundreds and even over $1,000 to acquire a customer. But given the long-term lifetime value, this still produces a positive ROI. We believe we have an advantage compared to many of our peers that enable us to have a relatively low customer acquisition cost. Our unique value proposition, including free credit score and now free ID fraud protection, along with our MogoCard and Bitcoin account, helps us acquire customers at a fraction of the cost of what banks pay. This is also helped by our unique partnership with Postmedia that gives us over $30 million a year in marketing spend. This helps give a halo effect to all our other marketing channels, which ultimately results in low customer acquisition cost. Improving our marketing performance continues to be a major focus of ours, and we have many initiatives helping us achieve this. We are also about to kick off a new influencer campaign, where they will begin promoting the Mogo app and various products. Obviously, influencer marketing is increasingly becoming important as many of the younger generation are making decisions based on the people they follow. Our business model continues to be driven by a formula that helps drive low-cost customer acquisition and engagement, combined with multiple ways to monetize. Our team is hyper-focused on executing this strategy, including a product road map that is designed to continue to increase utility of the Mogo app for our members, helping them improve their financial health, while also driving revenue and profitability growth. With that, I'll ask Greg to cover the financials in more detail. Greg?

Thanks, Dave, and good morning. Building on the strong Q2 results, we reported another excellent quarter across all our key financial metrics that once again highlight the underlying profitability and cash generation capability of our financial model. In addition, we also reported very strong growth in net member additions as well as Bitcoin account growth, which we believe is just at the beginning of the growth opportunities in those 2 areas. We also outperformed our guidance on revenue and adjusted EBITDA in the quarter. Specifically, revenue for the quarter of $9.8 million was above our guidance of $9.5 million to $9.7 million. Adjusted EBITDA of $4.8 million was above our guidance of $3.8 million to $4.2 million and represented a record 49% margin for the second quarter in a row at this level. This increase is primarily attributable to record gross margins of 93% as well as the second quarter of significantly lower growth-related operating expenses. Another highlight this quarter was positive netting about $1 million. Cash flow was also very strong with positive cash flow from operations net of investing of $4.4 million, which was at the high end of our guidance. Cash increased by $2.4 million in the quarter, ending with approximately $10 million of cash, which was after paying an additional $2 million on our credit facility. Total cash and investment portfolio ended the quarter at $26 million. As we look ahead, these metrics give us strong confidence in our plan to dial back our growth investments to support accelerating revenue growth in '21. As Dave mentioned, our model starts with a low-cost member acquisition strategy with new products and product enhancements. We saw an acceleration of new member additions in Q3, which were up 89%, and we ended the quarter with well over 1 million members. We expect to continue to drive strong member growth, and we're turning our attention to increasing engagement. Revenue for the quarter of $9.8 million, as I said, was ahead of our guidance, while core revenue was down year-over-year due to proactive measures that we took for COVID. As we look ahead, we see an acceleration of top-of-the-funnel activity with accelerating member growth and believe one of the best monetization models of any consumer fintech globally. Specifically, we currently have 8 distinct ways to monetize our member base, and we are just getting started. We plan to continue to expand our monetization model in 2021 and beyond. The underlying profitability of our business was again clearly highlighted in Q3 with record gross margins and adjusted EBITDA. Gross margin climbed to more than 93% in the quarter from 67% in Q3 last year. Adjusted EBITDA of $4.8 million was up from $1.1 million last year, and EBITDA margin was almost 50% in the quarter. In the last 2 quarters alone, we have generated approximately $10 million of adjusted EBITDA, clearly showcasing the underlying profitability of our model even at current levels of scale. This gives us increased confidence in resuming growth-related investment, in particular product development and marketing, as we take full advantage of the accelerating shift to digital banking and Mogo's unique position in the Canadian market. Although COVID focused us or forced us along with a lot of others to make changes in our investment plans in 2020, one important benefit of this was showcasing to the market both the resiliency of our model as well as the ability to adjust our growth levers to generate meaningful cash flow and profitability. Q3, as with Q2, clearly demonstrates this with us generating $4.3 million of cash from operations net of investing. Perhaps more impressive was the $3.3 million of cash flow generated from operations, excluding cash generated from loans, which was up 74% from Q2 levels. In addition to a leaner cost structure, our actions in 2020 have substantially improved the balance sheet as well. The main balance sheet highlights for 2020 were the sale of our liquid loan book reducing our credit exposure by approximately $32 million and reducing our credit facilities outstanding to $37 million, down from $77 million at year-end. We extended the remaining facilities to July 2022 and reduced our interest rate significantly. We amended our $12.5 million convertible debentures and extended the maturity to 2 years, to May 2022. Lastly, we amended our nonconvertible debentures, including reducing the average interest rate from 13.7% to 7% and extended the maturity base. Individually, these are all meaningful steps. Together, they allow us to move forward in a significantly stronger financial position. Clearly, we've had to take decisive actions in 2020 to strengthen our financial position in an uncertain environment. However, with a favorable backdrop for fintech, including accelerating demand for digital financial health solutions as well as leaner cost structure improved balance sheet and with clear proof that we can be profitable, we expect to renew our growth investments to support accelerating revenue growth in 2021 and beyond and take full advantage of industry tailwinds. With our unique and proven platform, we believe we are extremely well positioned going forward with multiple growth drivers, including the expansion of MogoCard, which as Dave mentioned, is already showing signs of ramping nicely. The expansion of our referral partner strategy, we are also quite excited about the traction we are seeing in our Bitcoin account without any real marketing investment. As we roll out the rewards program, we believe this can be the material driver of new members and revenue from transaction fees. Lastly, we introduced -- we will introduce the P2P solution and other new products as we move through 2021. Stepping back, we thought it would be helpful to take a look at the bigger picture opportunity for Mogo over the next 3 to 5 years. With the Canadian banks generating over $100 billion of annual net income and the move of the next-generation to a digital solution with products that help them make smarter financial decisions, we believe Mogo is extremely well-positioned to take full advantage of the massive market opportunity ahead of us. Specifically, over the next 3 to 5 years, we are targeting to grow our member base threefold to 3 million members, increase our average revenue per member from just under $40 today to a target of approximately $100, which we see as a very achievable target given the average revenue per member of a Canadian credit union is over $1,300. Using simple math, this would make us a $300 million revenue fintech business, which would create tremendous value for our shareholders and we believe would still be only scratching the surface of the opportunity in front of us. With that, we will open the call to questions. Operator?

[Operator Instructions] Your first question comes from the line of Doug Taylor from Canaccord Genuity.

Your decision to begin reinvesting more in your products, I wonder if you could help us think about how that's going to flow through financially and kind of parse it out into what you see as investment in some of the new product initiatives versus reinvesting in the loan book and the lending portfolio, which is something that you've kind of ramped down through the first part of this year.

Yes, sure. Thanks, Doug. It's Greg. So yes, the vast -- on the product development side, I would say close to 100% of the incremental investment we're planning to make there is going to be really related around new products, not around our loan product, but around -- P2P, obviously, is a big initiative for us, continuing to enhance and expand the features related to the MogoCard as well as the Bitcoin account and potentially additional new products. So really, any incremental spend of where we are there on technology and development is very much going to be around expanding our non-loan related product as well as investing in new products.

So is it fair to say from that, then the -- we should expect the loan book to remain static, continue to gradually, at least in terms of loans on your own balance sheet, continue to contract a little bit? Or what should we make the expectations of that business?

Yes. We think the loan book is going to stay relatively static, is not going to be a drag on our revenue going forward into 2021. But really, on loan side, as you know, our focus on the loan side is really through our partner lending program and our referral program for growth versus on balance sheet. Okay.

So do you expect then the investment -- can you help us quantify what you'd say is the level that you're expecting to reinvest? And is that -- it should just come through in R&D or marketing?

Yes. Yes, it's going to come through in R&D. I mean if you kind of look at levels that we were at in Q1 on the technology and development side, I think it would be reasonable to think that we're going to get back to those kind of levels.

Okay. There's certainly Bitcoin strength and some of the development new features that you put into your Bitcoin product is featured pretty prominently in both your release today and some of your recent product announcements. Can you help us understand to what degree those are contributing financially to your performance here?

Yes. So look, Bitcoin is still very early days for us. I mean as you know, we were really one of the pioneers in Bitcoin in Canada, launched the account almost 2.5 years ago. But shortly after launching the account, obviously, Bitcoin had a very quick retraction and sort of fell out of favor with a lot of investors. But we've seen over the last year or so, that credibility building and with not just Square in the U.S. but now PayPal coming into the space in a massive way. And increasingly, more and more of really some of the leading money managers around the world, talking about Bitcoin as the digital gold or 2.0, we believe in the long term, we believe in Bitcoin as a long-term asset class. And so we are going to continue to focus on that product as a core product that Mogo delivers. It's really something that competitively differentiates us from all the traditional financial institutions in Canada as well. We are coming at -- we are starting from a low base on those products. So today, there's still not a meaningful driver of revenue. But as Dave mentioned, we are seeing a very significant increase in those. So we do expect those to start becoming more meaningful as we move into the quarters in 2021.

Okay. Last question from me, and then I'll pass the line. Any update on the monetization efforts for some of the other assets that came with the difference capital transaction? We haven't spoken about those in some time.

Yes. So nothing specific to update. What I will say is there are a number of those -- the companies in that portfolio have seen positive signs in their business. And 2 of our big holdings have done growth related debt fundings in the last 6 months as well as one whose suite brought on a new CEO. So I think we're seeing a lot of -- and those 3 companies would make up at least 50% of our portfolio. So we are seeing some positive signs there, and we do think that we are likely to see a monetization opportunity in 2021 of at least one of those investments for us.

Your next question comes from Suthan Sukumar from Eight Capital.

Congrats on the quarter. First question from me is on your new ad campaign. So I mean, this quarter, you saw a nice lift sequentially in new member adds, and that was pre-rollout of the campaign. Can you touch on what early trends you're seeing now from a new member add perspective with the campaign live?

So this is Dave. When you talk about the new campaign, so again, one of the campaigns that we're -- we actually are about to kick off, we actually haven't kicked off is essentially the new Bitcoin campaign. So as we had mentioned, the growth we saw in Bitcoin, including going into Q4. So as I mentioned in my comments, October, we're actually seeing a significant increase from previous months. And we have yet to market Bitcoin. So we literally have just completed the creative and the ads. Obviously, just announced the new Bitcoin rewards program. We have yet to actually basically market that in any way, and that should be kicking off later this month. So we kind of see that as incremental growth from what we're currently doing. So all of our existing campaigns will continue, as we mentioned. Free identity fraud protection has definitely helped accelerate growth. So when we run these campaigns, we're always testing our value prop and seeing what actually performs better. And the addition of free identity fraud protection has significantly improved the performance from just marketing, say, free credit score. So we anticipate that adding in Bitcoin, especially with what we're seeing is going to obviously accelerate our member growth. And we also are -- have yet to announce this new Rainforest Mode that we just talked about in the presentation. So that's a new feature. We're actually expecting to do a release on that shortly and then also begin marketing that as well. So I'd say those are the 2 kind of net new campaigns that we plan on launching later this month that should help accelerate what we're currently seeing.

Okay. Okay. Great. And kind of with respect to this, call it, new cohort of users coming in via Bitcoin, the free MogoProtect offering, and obviously, the prepaid card; is there anything notable you guys could call out with respect to kind of user behavior in terms of engagement and other product adoption on the platform?

Yes. I mean as I mentioned, I think one of the most interesting things, quite frankly, we were surprised at the level of activity that we're seeing in terms of how many alerts we're actually sending out to new members. So the fact that 30% of new members get an alert within the first 60 days is great because that, obviously, if you sign up for free identity fraud protection, we're automatically sending out a biweekly alert. If there are no alerts, just it will let you know that all is clear. But for those 30% that are actually seeing an alert, you can imagine that definitely drives more engagement. And ultimately, also in the NPS, we're starting to do Net Promoter Score surveys, which is typically a precursor for even sharing, right? One of the channels from a marketing perspective we're really focused on is increasing word-of-mouth referral, et cetera. The precursor for that really is a strong Net Promoter score, right? So anything we can do to increase the actual experience, the value prop, especially, for example, on Protect, that's actually where essentially it becomes another way to monetize. Obviously, referrals are a lot cheaper than traditional marketing. A lot of referrals are obviously free. Free identity fraud protection is something that once you have it and you experience it, and it obviously helps you, you're literally going out of your way to tell your friends and family, hey, you have to get this thing, especially when others are charging $240 a year for it. So we're starting to see some of that. What we're also seeing, for example, in our card program is some really interesting data in terms of seeing what card customers turn into higher-value card customers. Obviously, still kind of early days there in terms of gathering this data, and we're obviously looking at cohorts. Every month, we look at different cohorts, July, August, September. We continue to see an improvement in those cohorts, and that continues to give us more and more data in terms of what are the kind of merchants and companies that the higher value users are shopping at, and that gives us the ability to kind of better target that in our marketing campaigns as well. So all of this data just gives us better information to better expand and target on our marketing side. And we expect that the other key point I wanted to mention again on identity fraud protection is the low churn, right? For example, credit score monitoring, there's a lot of people out there that have a credit score. Obviously, everybody has a credit score, but many people say, hey, it's never been an issue for me, and I've always managed to get the credit, don't really care about it. There's nobody if you talk to that once they understand identity fraud that says, oh, I don't need identity fraud protection. Everybody needs it, whether or not you're checking your credit score or not because if you become a victim, it's a real hassle, right? So the fact that, that product essentially almost has a 0 churn because once you have it, it's not something where you're saying, hey, I want to get rid of. So when you think about how difficult it is, especially in financial services, to acquire a customer, to give a customer a reason to download the app, give us their information. We're essentially getting, obviously, tracking their bureau as well for a lot of these alerts. That's a big deal, right? And it's from there that we obviously look to continue to kind of build up that trust and credibility. And also that then ties into even our Bitcoin rewards program, where just like credit score, we're now tying Bitcoin in, i.e., if you're attracting your credit score you now have a reason to get a Bitcoin account. Bitcoin account is also where we drive monetization. We're going to be doing the same thing with Protect, right? And it really is about building that trust and credibility. And we absolutely see. The other key thing is we see typically a 5x increase in retention and engagement as somebody downloads the app. And the nice thing about identity fraud protection, you have a much higher likelihood to download the app, given the nature of it. That's where you're going to get the alerts and obviously, the formula is simple. The more engaged and the more you retain that member, the higher the percentage of those members you end up converting and monetizing into those other products.

So Suthan, just to add to that, I mean, you know yourself if you're tracking Bitcoin or tracking a stock. And with Bitcoin, people are putting alerts on their phone, hey, tell me when it's over x or under y, you can get multiple alerts a day. And it's an engaging alert. It's something that you actually care about, right? So that really is from an engagement perspective, a huge product for us. You think that credit score as Dave said or even identity fraud protection, although those are great valuable products, you don't drive that daily user engagement and daily user engagement increases probability of monetization. Obviously, we've seen players like Square with a pretty similar value proposition in a lot of ways to the Mogo app in the U.S., leverage Bitcoin into driving more users and user engagement and monetization across the other products. And we believe we've got a similar opportunity.

Great. No, that's helpful. I want to touch on your growth investments next. Looking into fiscal '21, and you touched on it a little earlier, Doug, with respect to your thoughts around the investment in the technology side of the business. But what are your priorities in terms of investment areas have maybe outside of tech? And more broadly, how should we think about the impact to your OpEx and EBITDA margins going forward?

Yes. So I guess a couple of things. As you're well aware, if you look at really kind of the leading public fintechs out there, a number of them -- the majority of them actually are not even EBITDA positive. Or if they are, they're marginally EBITDA positive. But they're seeing a lot of investor interest because they are investing in their platform and driving growth in a massive market opportunity. And we believe that we have a very similar opportunity for Mogo in Canada. The key criteria, though, or a key element of that is that investors in the market have to believe in the underlying profitability of your model so that they will actually give you credit for investing in driving growth. And I think one of the big milestones over the last couple of quarters, which wasn't planned, but it happened because of COVID, is that fundamentally we believe we proved out the underlying profitability of our model. So if we're at close to a $10 million a quarter revenue with close to 50% EBITDA margins, I'd say that's unheard of. There's not a lot of companies that can generate that kind of EBITDA margin at that kind of scale. Now what we'd like to do is take some of that EBITDA and start investing it in driving accelerating revenue growth. And we believe that with the proof points we've had over the last couple of quarters, I think there was a view that maybe Q2 was a fluke. And now I think we're showing the market that Q2 wasn't a fluke from a profitability and cash flow perspective. But we believe that's going to give us the credibility to start investing more into taking advantage of the massive opportunity. As I mentioned, the banks in Canada make $100 billion of pretax profit. So that's just a massive pie, and we obviously are a very small piece of that today. So we want to take advantage of it. We think we've got a unique value proposition from a product perspective and scale. There's really nobody else in Canada that has that, and we want to take advantage of it. So we want to start investing more of our EBITDA and cash flow into growth. And so you're going to start to see us ramp that up in Q4. And we believe that if we can continue to show accelerating growth that the market is going to reward us for investing in this big opportunity, especially with the clear understanding of the underlying profitability of our model.