Tern Plc (TERN.L) Earnings Call Transcript & Summary

Well, good evening, everybody. I think most people have joined now. Good evening. My name is Tim Metcalfe, and I'm pleased to welcome you to the Tern Capital Markets Day presentations this evening, following the AGM earlier today. With me today, I've got Sir Al Sisto, the CEO of Tern; Alastair Williamson, the CEO of Wyld Networks; and Barry Downes from Sure Valley Ventures. Darron Antill from Device Authority, apologizes. He is currently traveling in the U.S., but Darron has prepared a presentation, which has been recorded, and that will be part of the proceedings this evening. We've also got Sarah Payne with us, but she's sharing the computer with Al. I can assure you that it is still Al and not Sarah as it says on the screen, but Sarah will be coming in later for the Q&A session. Given the number of people that we've got with us this evening, unfortunately, it's not possible to go to you individually, ask you to unmute and put your questions to the team. But we do really encourage questions. [Operator Instructions] So without further ado, I'll hand over to Al just for a few introductory remarks, and then we'll move on to the presentations. Al?

Thank you, Tim, and thank you, everyone, for attending and signing up for our first Capital Markets Day here in 2022. We're excited to have you here. And really, I think we've prepared an agenda that you'll find satisfying and exciting with regard to the information being delivered. As Ian Richie discussed at our Annual General Meeting this morning, the last 2 years have been really pivotal for all of us at Tern and at Tern's companies. If there's a silver lining from COVID, it is one that is all about the acceleration of digital transition of IoT devices and the software and the use cases for creating a contactless environment that our companies have been able to leverage and create growth vectors for now and for the foreseeable futures. These contactless environments are -- and the lack of human resources have really become the key market drivers for our company's growth and our current success in the businesses that they're addressing. Our companies from the get-go have been unfortunate. And as part of that fortunate outcomes, last year, we were able to launch Wyld Networks, Alastair's company who you'll hear from -- in an IPO on NASDAQ First North. This was an incredible opportunity that we took advantage of because of the success of Wyld and the team and business model that Alastair has put together and it's creating new value and unlocking value for us through the public participation in our larger shareholder position within Wyld. You'll also today be hearing from the other companies who also have stepped up in values today in this year from Device Authority and Alastair's company. But it's also important to know that at Konektio and in Talking Medicines, we were able to, again, in the year 2021 create third-party validations of the business models and the opportunities and create step-ups in value in those organizations as well. And I think this is from a shareholder point of view, important because with this third-party validation, we have been able to increase our net asset value by 35% year-over-year from 2020 to 2021 to about 32 -- a little over GBP 32 million. We believe that because of these fundings and because of this net asset value increase, we are and our companies are well positioned for the future. In particular, we're pleased to also have as part of the step up in values this year, the addition of Venafi as a strategic investor in Device Authority. These actions that we have had an additional uplift in value enable us to gain through our companies, significant commercial traction and grow their monthly recurring revenues. And as you know, we've been emphasizing monthly recurring revenues as a key metric for how companies are valued in the marketplace. And our companies have had significant impact of other monthly revenues or their annual recurring revenues through 2021 and now ended through 2022. And I believe it's important from your perspective and ours that we look at these monthly recurring revenues and the trends being created by our companies to evaluate the value of the business and understanding that value of the business, monitor it to make appropriate decisions to create value for you, our shareholders, through a trade sale or an IPO when the time is right or when the opportunity presents itself through an unsolicited offer. Our companies, we believe, are for sale every day, but we're not trying to sell them. And we're waiting for the appropriate moment to get the maximum amount of value for you, our shareholders. And I think we now have reached a position in our businesses where this recurring revenue is really having a serious impact to value creation that we believe will return handsome rewards for our shareholders and return in general. Lastly, in March, we agreed to participate in a new venture capital fund to Sure Valley Ventures, a U.K. software company with -- U.K. software technology venture firm that has, as its major partner, the British Business Bank and a series of other investors besides Tern. We believe our participation in this new silicon Sure Valley Venture fund is an excellent way for us to broaden our exposure to the marketplace that we share in our vision between Tern and Sure Valley Ventures and a way to, in effect, curate opportunities for us to coinvest with them either at the inception of an investment or later on as a follow-on to a Series A. We believe that with our modest capital involvement within Sure Valley Ventures, we have created a potentially significant opportunity to create benefits for our shareholders. But rather than have me go on about Sure Valley Ventures, we have today, Barry Downes, Managing Partner of Sure Valley Ventures, and we'll let him tell himself about Sure Valley Ventures, his vision, the synergies between our businesses and what he sees as the future for his fund and are working together. Following Barry, you will hear from Device Authority's CEO, Darron, who's recorded a presentation for you about the business and the current state of affairs. And then we'll close with Alastair giving you an update on Wyld. His experience being a public CEO on the NASDAQ North and what he sees is the future for that business. So without further ado, I'll turn the screen over to Barry, and Barry, please let them know about your exciting venture firm.

Thank you, Al. I really appreciate it. Just pop up a quick presentation here. I got that up. Can everybody see this? Great. Well, it's great to be here with Al and the team at Tern to tell you a bit about Sure Valley Ventures. So as Al mentioned, Sure Valley Ventures is a U.K. venture capital firm. And the fund that I was talking about is a new GBP 85 million venture capital fund, investing across the U.K. that's anchored by the British Business Bank. We have a team in London and also in Cambridge. And we also have one in Manchester as well, and we're shortly to officially open the Manchester office, and that's for on-the-ground origination of new software technology companies. And as I mentioned, we're anchored by the British Business Bank. They provided GBP 50 million of the GBP 85 million, and it's on a capital drawdown model. And this is effective, what this means is that the funds are only called as we're doing investments into new companies. And then cash is returned immediately to our LPs on the exits of those businesses. Now we're targeting key disruptive technology areas that have enormous potential over the next number of years. And those areas are very aligned with the Tern investment diaries as well. So things like Metaverse and immersive tech, AI and IoT and also security as well. And we have a particular focus on software. And then I think what's particularly interesting for LPs is that the British Business Bank model offers an exceptional profit share model to LPs such as Tern. And it's a model that's not generally available in the marketplace. So in summary, the BBB are putting in GBP 50 million of the GBP 85 million and taking 20% of the profits, whereby LPs such as Tern are putting in GBP 35 million of the funds or taking 60% of the profits. So there's kind of a leverage to return -- profit share return for our LPs such as Tern. And Tern themselves made, as Al made a capital commitment of GBP 5 million out of the GBP 85 million, and that's approximately 5.88% of the fund. And I guess the key reason for doing that is there's really fantastic synergies between Tern and Sure Valley. I'll talk about the synergies as we go through the presentation. So first of all, just a little bit of background on me and the team. So I'm a technologist. I go back over 25 years in the technology business, strong focus on software. My initial work experience was in the Boston area, which is one of the top tech hubs in the U.S., then Silicon Valley. And then when I came back to Europe, there's a couple of notable things I'd draw your attention to. I ran a research group called the Walton Institute, which was a leading European R&D center, looking into the future where technologies are being developed and how they evolve over medium term and long term. And then coming back to today and building out those technologies with some of the largest companies in the world, across Europe, U.S. and also Asia as well. And then one of the other things that I've done is I founded a software company. So I've had the full founder journey from founding a software company, building that company and ultimately selling the company to a Silicon Valley giant. And in this case, it's Red Hat, who are a global leader in open source and Red Hat recently sold themselves to IBM. And so my background is kind of tech, looking into the future, looking at where technology is going. And then, of course, we established Sure Valley in 2017 and doing investment management and selecting companies and investing in those companies. Brian, who is a co-founder in the fund has a 12-year investment management track record that covers venture debt, venture capital, special situations, has a lot of experience in the public markets in the U.K. as well. But also has a founder background and also -- and in fact, helped me with Feed Henry and also goes back and has a long technology background specializing in artificial intelligence. And Cian, who is our Head of Platform and platforms are value-add for companies. Cian has a contactless that's a who's who in Silicon Valley because he spent most of his career in Silicon Valley before moving back to Cambridge and Cian worked with a fantastic fund in Silicon Valley called SEG Global. And that was a fund, an accelerator and also consulting firm and ran a network of the top executives in Silicon Valley. And as you can imagine, that's very additive to and supportive of Al's experience in Silicon Valley as well. And then Isabelle runs our origination. Originally she's come up in the venture capital industry, originally Telefonica in London and Madrid then with Schibsted in London, which is the corporate VC and then she was with the Barclays FinTech Accelerator before coming to Sure Valley. And she won the Specialist Investor of the Year award in the 2019 Women in Finance Awards. And this team has worked together for a long period of time, particularly, I've worked with Brian and Cian for over 12 years in one venture or another. Now we've expanded the team. We've had Mel, we brought. Mel on as well, and Mel has a significant entrepreneurial experience as well, but has an amazing network in the north of England. She's based in Leeds and doing origination for us in the North, in particular. And then George based in Manchester, along with Cian, and George has again come up in the venture capital industry, started as an analyst in London with Shore Cap, and has worked through the industry and was recently with a fund in Manchester that has an amazing track record of work working with Angel Investors as well. And Greg is a very experienced CFO of financial services organizations and fund management and comes to us from Sharp Capital in London was his previous employer. And that team, I think, is going to support and augment the Tern team. And actually, there's great synergies here because Sure Valley is focused in London, Cambridge and the North of England. Obviously, Tern has -- based in London, but also has very strong connections in Scotland as well. And team members, such as myself and Cian also have great exposure to Northern Ireland as well. And actually, the first investment of this fund is a Belfast-based company called RETìníZE, which is a global -- which is going to become a global leader in the advertising space and also animation in that area. So just a quick overview of our strategy here. And again, this is incredibly aligned with what Al and the team are doing in turn. Going to the top left-hand corner, we're really focused on a number of key areas, which are almost identical to the areas that Tern is focused in, really super high-growth software areas, Metaverse, immersive tech. So for example, Tern has invested in VR. We're investing in VR and AR and Metaverse areas as well, AI, security and also IoT as well. Al mentioned earlier on, going to the top right-hand corner here, Al mentioned that one of the synergies here is on co-invest, but also a follow-on as well because we invest the seed stage. So one way to think about us is we're scaling the country. We're looking for the top emerging tech companies, and we get in at an early stage and lead those deals and Tern can come into any of those deals at that stage or can kind of hold back and come in at the next stage, which is a Series A stage. Our focus is on leading up the seed, getting really, really attractive valuations and then bringing in key partners such as Tern as we go through the scaling rounds for the company. As I mentioned, geographies, U.K. and there's a couple of approaches to origination. One of the approaches is traditional kind of on the ground, working the regions, finding the best companies. But also, we have a very strong, proactive outbound outreach where we're using a data-driven strategy to find the best new emerging companies and getting out to them to talk to them about their capital and financing needs at an early stage before anybody else. So by building that relationship at an early stage with companies and then investing in them at the right time. And then I think a very strong aspect of Sure Valley, which I think is getting a great synergy with Tern is we've got what we call the value-add platform. And this is all about getting in from day 1 in the companies and helping them build the ARR that I was talking about on the Tern companies. And really over a 24-month period, getting the companies to GBP 1 million in annual recurring revenue or similar. And sometimes, actually, the companies will accelerate much faster than that as well. So it's all about getting in and having a game plan for helping the companies create value in the first 3 months, the first 6, the first 12 and then after that, raising the next round to scale the company up. And this is one of the benefits for Tern as well in that they can come in either at this early stage or at the scaling round or both. I should say also, we're -- the plan is to invest in 25 companies through this fund over a 5-year period. So it's approximately 5 companies a year. And getting in an early stage and then scaling these companies up. Now in terms of the style of investment we do. So first of all, we're focused on this area of disruptive innovation. So disruptive innovation companies typically have significant intellectual property and software. But also it's not just about the tech. It's also about the creation of a new market. And these new markets ultimately will grow and develop such that the company can become the dominant company in that market and become a $1 billion company. And the strategy here is capturing these potential billion-dollar companies or unicorns at early stage at low valuations, typically GBP 2 million to about GBP 8 million getting in their herd and getting a good chunk of the equity in the company and then helping them with partners such as Tern scale up and ultimately become those unicorns. And to help with that, as I mentioned, we have this very strong value-add platform that's really based upon our experience as entrepreneurs and founders, but ultimate network of founders that we brought together to help the companies. So we have what we've -- what we call a platform advisory group, and that's over 50 people now across the globe or experts in their areas and previous founders that can come in and help those companies grow and scale as well. So it's really about expanding the network. Very large number of those executives are based in Silicon Valley. And then we've also got U.K. and Europe and then also Asia as well. And this is great. So for example, once these start-up companies get going and want to internationalize and trade outside the U.K. Quite often, the U.S. is the first target. Of course, Al has and the team have phenomenal Silicon Valley experience but we're bringing some extra experience to bear with key contacts in these regions to help that scaling and similarly for Europe and also for Asia as well. So a bit of background on the British Business Bank for anybody who's not familiar with. So this is a government-owned bank who's theme is to help British business to start up scale and stay ahead. And BBB post-Brexit is fulfilling its original mandate but also taking over from the European Investment Fund as well in the U.K. and is rolling out a whole series of programs directly for business, but also they fund and support venture capital funds as well. It typically runs at 2 divisions. A division called ECF division and then their Patient Capital division. So we -- our allocation of GBP 50 million from the BBB is through the ECF division. And ECF is kind of like the program where the British Business Bank supports emerging managers in the U.K. So these are the managers that they want to support become the next -- the next on capitals, for example, are notions or excess loans because they've all come through the BBB program. And I guess what's different about us is our focus on very specific areas that are aligned with Tern and also our whole of the U.K. approach as well. One thing just to note on this also is -- this is kind of a great stamp for LPs and that British Business Bank did a 2-year due diligence on the team and the fund and the plans and probably the most comprehensive due diligence in the industry. So it's great -- I think that's great reassurance to investors as well. So just a little bit on the deal that Tern was into. So BBB have committed GBP 50 million, and we'll receive a 20%, 20% profit share and a 3% of prioritized return and then LPs received a 60% profit share. So this is -- this kind of leverage return that all the investors are getting. So as the fund generates profits from selling companies, the LPs get a disproportionate return. The fund is new. So we closed the fund at the end of February 2022 at GBP 85 million. And we also did the first investment in RETìníZE at the same time. The fund is a hard cap of GBP 95 million. And as I mentioned earlier on, the LP signed what's called an LTA or an LP agreement to invest on a drawdown basis. And this is an example of how capital is drawn down over time. And this matches the profile of investing in new companies and then following on in those companies over time. And the great thing is it's very, very capital efficient because capital is only cold when we're making investments, and then it's returned immediately when we do an exit on a company as well. So super capital-efficient for LPs. So just as a summary, I guess, and we can talk about synergies as we're going through this as well. So we -- in terms of the team that's working on this project for Tern, first of all, we have proven -- a number of proven founders in the team who've gone full life cycle and that's very important for the stage of development for the companies we invest in. They like to deal with founders. They like to work with people who have been on the same journey as them. VC as it gets to later stages like B and C is more traditional finance. But at the early stage companies like typically, they're technically led, companies like talking to people who have technical backgrounds and founder backgrounds. And I think that adds a lot of value to the mix for our investors and for the companies. We have deep, deep experience in the areas that we're investing in. And also -- and this is very complementary and synergistic with Tern as well. We have been investing in these areas since 2017. I have personally been working in some of these areas going back to 2010. We know all of the major companies. We know the acquirers of companies. We can help portfolio companies with sales and with talent. So this experience in these areas, I think, is very synergistic with Al and the team in Tern. And also the team within this has experience across the gamut from preaccelerators to accelerators to venture capital, to venture debt and M&A as well. And we have demonstrated a capacity to win really high-quality deals and produce exits and a really strong track record. VC for me is also a network business as well. So we have offices in London, Dublin, Cambridge and Manchester for origination. We get out around the country. We meet investors -- sorry, we meet companies where they are based. Typically, where we take up offices, we take them up in accelerators where the companies are based. So really close connectivity to the entrepreneurial community across the U.K., but also these great connections across Europe and in particular, to Silicon Valley, again, very synergistic with the Tern team. So I think us working together will create great synergies and supercharge the results that we're both creating as a team. And then this platform that's all about delivering mentoring, networking, training to the companies we invest in. That's all about accelerating their development but also reducing our risk as well. And we have a tremendous track record of getting companies from those early stages to Series A, Series B and also IPO and trade sale as well. And then as I mentioned, for track record of getting these companies across these key stages. And a vision as to where these industries that we're investing are going. And we couldn't be happier and more thrilled to be working with Al and the team in Tern, and we really look forward to the next 12 months and doing some great deals together and briefing you on those deals.

Well, thank you very much, Barry, for that presentation. [Operator Instructions] Barry, if you can -- thank you, stop sharing now. As I mentioned right at the beginning, Darron Antill from Device Authority, is currently in meetings in the U.S. given the time difference so he's unable to join us at the moment. But he has provided a presentation, which is recorded for us. And I'm now going to play that. It's about 15 minutes or so, and then we'll move on with the rest of the agenda.

Hello, everybody. This is Darron Antill from Device Authority. Apologies I can't be there in person, but I'm traveling on the East Coast of the U.S. this week. However, I've got a short update for you. Hopefully, you find it useful and insightful. To kick off, what I want to do. Just by way of an introduction to everybody, especially for those who don't really know us is to just show you a short video that introduces Device Authority and effectively what we do. So we'll kick straight off now, and I'll be back. [Presentation]

Okay. So hopefully, some of you may well have seen that, but let me now jump into the presentation by the way of giving you a quick update. Okay. Right. So I guess there's a few takeaways today. And one of them, I think, is just to consider one of the progress we made of a fantastic quarter that we've just had, new logos in some new industries and some significant, I guess, phased rollouts as people are now moving from pilots through to production. So we've had a good quarter. We've got some good recognition, and I wanted to give you a bit of an insight into that. The thing to bear in mind because often people consider what we do in terms of the market. I just wanted to point out the whole -- the real challenge that we're dealing with here is how are we managing trust, that's device trust and data trust at scale for IoT devices that are typically not managed by humans and will be of a volume of magnitude that is just exponentially more than what has been dealt with over the last 25 years or so when people refer to identity and access management of the enterprise, i.e., people. So we're all focusing on things. The market is huge. Recent data suggests it's well over GBP 400 billion in terms of the amount of spend and COVID is really accelerating digital transformation. As CEO, I've seen COVID drive a number of new business models and a number of new markets. Medical seems to have accelerated further as people look to bring on more devices, both existing in the field and new devices to market. But also, we've seen, I guess, the 2.0 version of automotive, the sustainability, energy-efficient, EV-type initiatives as people are moving to new power-generated electric vehicles. So we've seen a number of new initiatives there and some new customers. So we see the market now continuing to accelerate specifically in some primary verticals. If you look at the market dynamics, I mean, growth is one thing, but there's also been significant consolidation. We've seen some of the partnerships that we effectively were that have been acquired by others, including the and Medicaid. You've also seen a significant number of increases. If it's not hacking Colonial Pipeline that has a significant -- that led to a significant shortage of oil last year in North America. There are more and more threat vectors to consider. There are more and more attacks, and we'll talk about that a bit later. And there's a significant uptake in the amount of legislation. It's not just about best practices that we saw really take the -- look, it's the early stage. -- and you've got specifications being driven by Mist and IoTSF and others. But now you've got things like the Biden executive order. And specifically, compliance and regulatory requirements coming down often being driven by North American regulatory requirements, which I think, again, are tapping in or extending effectively now into global requirements. And we've seen evidence of that, and I'll touch on that. But what's really good, I guess, from our perspective, if you look at PKI in the enterprise is a well-established security approach that's been used by many professionals for 25 years or so. But now that nearly half the drivers or the reasons for deploying PKI is for IoT solutions. And that's right in our wheelhouse, and we effectively enable people to automate that and manage that through the life cycle. So people are seriously considering PKI for IoT deployments. And the challenges for securing IoT are many. There is no one silver bullet here. There's no proven identity model. People often care and want to make sure they secure data end to end, in transit and at rest. Identity of things is becoming the new perimeter. The firewall days are long gone when you're considering devices connected to the Internet in very remote devices, on oil rigs, on cars, on trains, in the wild. And both applications have to interact and work with the devices. They need to be a trusted device. If you can't trust the device, you can't trust the data. And then it's not just onboarding that device once it's there managing that through the life cycle. And many of these business models or devices, you just take automotive examples we have. The life span of these are like 15 to 30 years. So there's a significant number of challenges. And then, of course, you've got more and more compliance and regulatory requirements, which, by the way, I think, is absolutely a good thing and it is well overdue that people have started to take this more seriously. The good news in the last, I guess, couple of months, I mean, analysts is always an important piece of our market. It's still a new market, large companies, customers get educated by what analysts effectively guide and advice. And ABI Research did a significant amount of research and absolutely recognized Device Authority as the leader in identity, device cycle management. And it's great to see that some of these cybersecurity or enterprise security companies were considered in that mix as they look to pivot and add IoT capability into their offering. But the IoT and securing those things is what we do, and we came out top right. And you've seen other examples of that from people like the Quadrant SPARK Matrix previously. But this is good for us. So just touching on some of the compliance. So people talk about the executive order, originally came out through the Trump administration now driven by the Biden executive order. And I think this is just really the start. And SBOM or software bill of materials is one of those things that's talking to people really to sort out they have visibility of their supply chain, being able to trust the components, the devices, the solutions they can choose. And specifically, if this isn't addressed in North America, it will become low, you will not be able to provide solutions to the military, defense or other government-based organizations. And commercial organization, we'll start to look at this. And we've seen people now starting to bring this up and talk to us about it. So the SBOM is an important thing, good example of being -- have been driven down through IoT and industrial IoT. Specifically, it's critical infrastructure becomes under threat. And with wars and other challenges we have now in the world, even more so in recent weeks, the Biden executive, again, has positively reinforced this, especially those commercial organizations that have critical infrastructure that is key to North America. And in recent weeks, we are aware as well, with North America lease in many ways, the National Cyber Security Center part of GCHQ is also considering similar things, and we are now involved in a dialogue with them and other key partners. Something else I just wanted to touch on because we often talk about the challenges in IoT, but I think it's also important to understand the life cycle and where many of the other organizations or some of the competitors, some of the partners sit because if I understand this is to see the route how you fundamentally solve the problem for enterprise customers. So we deal with many people on that top left, and you've seen that we've announced a partnership and Avnet will bring out its new solution, including KeyScaler as its security operations, credential management offering in the coming weeks. So step 1 and 2 is important, really, as people look to put secure by design or secure manufacturing capability, into the products as they go into the supply chain. And there, we work with people within our earlier technology or we work with them so we become KeyScaler ready. So they're ready for customers who look to deploy such devices with those technologies in so they can manage them through the life cycle of those specific projects or products. Onboarding is important. Once you got it onboard again, it's not just doing it onetime only, but it's doing it again over and over again. With new devices, again, to the -- because people typically roll out devices, it could be 300, 5,000, 10,000 over a 2- or 3-year period. So that's really important. So adopting standards becoming more important. But the key is really how you get those devices to interact on application, how do you consume the data or assess the data or use the data? How do you allow people sometimes to interact into that data securely? And that's really important because many organizations have already spent significant investment in their cybersecurity or their security operations for enterprise. So being able to manage the IoT use cases in the enterprise is important. So integration is important. Being able to leverage existing investments is important. And KeyScaler effectively pulls all that together. And some partners like Microsoft is referred to is the glue. So that's where we fit and that's where other people fit. And you've seen our solution before, and this is just a very simplistic model. We're very much close to be coupled to the application, onboarding and protecting that application and onboarding imagine credentials of those devices and then the data end to end. And then the reason I wanted to pull over then this picture out, just to give you this is a more realistic marketecture view about how people think about it. I've already talked about on the right how people integrate into their enterprises. How do they leverage investments they've already made. How do they make doctors and nurses, for example, engage with some of the data that comes from those devices. How do they engage with their cloud platforms which one would be KeyScaler in the little section in the data center. But more importantly, really on the left, how do you ensure these different industry types, these different big rise groups that you're able to onboard, manage their credentials, manage the secure data through the life cycle ongoingly for many years without human interaction. And where we operate really on the left-hand side is we clearly are on the device, and we engage with the Tier 1 device or we work with those KeyScaler-ready partners. So that's just another more detailed view of our fit. Now we touched on some of the use cases and industries, again off the back of a great quarter. We've seen some exciting things going on in the automotive space. We've got some new customers who have come on board specifically deploying powertrain solutions, replacing old diesel truck engines. We've got new connected cars now going through to production. And one of them share their champagne moment where they're able to automatically onboard and deploy secret keys in the cars in a matter of seconds because of KeyScaler at volume to several hundred cars at once, which has saved them one, a lot of money, but two, they will never secure solution. Other examples are in the medical space. We've talked about medical robots before. We now have a second organization talking about robots that they want to make sure they can onboard and secure using KeyScaler. But that effectively is a tip of the iceberg, and they look to then consider how they roll that to that for other device side groups. So we're going to a pilot with another organization in that space. And we're working with a sterilization equipment company now who's looking to roll out from its original pilot 1 device groups to 2, and then 3, if the device groups as they roll out through medical hospitals in North America and around the world. So good exciting use cases. And again, just building on that, I touched on automotive, industrial automotive or industrial engines is very important. We've had, again, new inquiries about how people secure specific gateways and data that comes from engines. PKI management on devices is very important. And these are very big sophisticated expensive engines and one pilot has successfully completed at the back end of last year is now looking to deploy up to 10,000 to 20,000 new devices this year. So we're starting to see people post-COVID now to accelerate their rollouts. So in terms of partnerships, more and more customers have been picking Device Authority, and I just wanted to let you know give you insight into some of this. Microsoft, we continue to work with. We're working very close to them in a number of sectors, and we are driving towards what's called our IP co-sell readiness, where customers will be able to get credit for consuming KeyScaler through the marketplace. Microsoft also, Microsoft sales reps will really get credit for when Device Authority KeyScaler is also consumed by their customers. Avnet will be launching our brand-new IoT Connect platform in the next quarter. There was a big event. This effectively aggregates the service for all of the chip vendors and there's a big event, which we're participating in May when they launched their products where the chip members will be present, and this really gives a great solution to chip vendors and device manufacturers. I know, as I said in the -- well, Boston and our Virginia area because I'm meeting Virginia Innovation Partnership Corporation. Only recently, we were invited to help present as part of the build that they're looking at in terms of the blueprint that they're looking to roll out, the U.K. Science Minister and the U.K. government were over for a briefing. We're actively positive anticipating that. And it's interesting because since then national center, the cybersecurity is also engaged with us, which I think is interesting as we were looking to adopt some of the standards and practices again being driven by North America. And what we really like about the Virginia State is creating a blueprint with government and other critical infrastructure projects. And again, we have insight into some new opportunities already from there. And then Venafi, clearly recognized as a brand leader. I'll touch on that in a minute. They invested in the company last year. They see a number of IoT use cases. And we will be going to the RSA event, the big global cybersecurity event in San Francisco week 1 with Venafi, and we're engaging now on an enablement plan for their sales force looking for new opportunities. But just to touch on Venafi. Venafi effectively has been creating an agenda as a leader of a new category called machine identity management, which really differentiates the human and nonhuman identities. This has been a high cycle in our new category defined by Gartner. There's a copy or a link to report, if you're interested in that. But the main component is people have been really securing identities around servers, apps or laptops for 20-plus years or so. And then there was mobile and there's MAM-type solutions. And now there's IoT devices so 3 really core components that get backed up on that. We're the experts and the leaders in IoT device management or life cycle management. And you can see organizations like Keyfactor and trust and AppView all vying for a place in this segment. So I just wanted to give you a perspective on that because I do get some inbound questions about that space and where we fit in it. And then I guess, finally, just before we wrap up, just to give you a flavor in terms of where we're moving the product. We continue to adopt a PLG product and growth strategy, where customers are asking us to advance and add more features, as we become stickier and as we look to roll out some more problems for our existing customers, and that's really important to us. But one big thing that we're looking at is how do we effectively adapt our solution and bring on board a new engine that has AI and ML capability that will be added later this year to give people proactive insights so they can detect when devices are compromised. Imagine a scenario where behavior was changing all the device and you were able to learn from that and effectively then block or turn that device off until something was done about it. So that type of capability will be looking to our platform. And then finally, as I wrap up, there's a number of new assets, one I've already shown in the video and some new information that's available. I know some people would like to download it and read it. These are the latest new things. So I just thought I would give you a quick summary, so you can click on any links and go and investigate for your benefit. Thank you very much for your time, and have a good event. Thank you.

Well, I hope you've found that presentation from Darron interesting. We'll now move on to Alastair, who's going to give you an update on Wyld. So Alastair, over to you.

Good evening, everyone. Let me just get my slides up. There you go. So my name is Alastair Williamson and I'm the CEO of Wyld Networks. And I just wanted to spend 15 minutes just taking you through who we are, what we do and how we make money and where we are today. So if I was to sort of look at terming Wyld Networks, what are we? Well, we're a virtual satellite network operator. And we look at sort of 3 key things, and one is contactless solutions, frictionless solutions and sustainable solutions. And I'll take you through how we sort of fit into all of those use cases. So what do we do? I talked about being a virtual satellite network operator. But what we do is we offer affordable satellite connectivity for the IoT anywhere in the world. And as you all know, or you've probably heard me say this before, only 15% of the world has wireless coverage. The -- the other 85% has no access to the Internet. And it's this lack of global connectivity that's actually holding back the growth of the Internet of Things from adding about $2 trillion to $3 trillion to global GDP in the next 10 years. So what we did at Wyld is we developed a solution called Wyld Connect. And what it simply is it's an affordable wireless solution to allow you to connect IoT and devices and sensors anywhere in the world directly to low-earth orbiting satellites to provide 100% global coverage. So we're going out to our customers with a solution that basically takes them from their 50% -- 15% access to the Internet to 100% global collectivity for their sensors and devices. So if I look at the 3 sort of key things when we're talking to customers and to shareholders and -- the first is what is our value to our customers, and it really is very, very simple. We offer our customers a 100% global coverage for their IoT devices and sensors. And I'm always asked about so what differentiates you to other satellite IoT solutions? Well, we went down a path of trying to address affordability for our customers. So we offer our customers low-cost terminals, and we also operate in free-to-use spectrum. And I say we operate in free-to-use spectrum. We use LoRaWAN as the technology to deliver data from our Wyld Connect module embedded into a sensor directly to the satellite. Now traditional sort of satellite IoT solutions used regulated and paid-for spectrum. So they have to pay governments in every country they want to deliver that data to a certain chunk of money every year. And that's been very prohibitive in trying to get an affordable solution. So we've taken that prohibitive costs out of the whole concept of satellite IoT by actually using LoRaWAN as a technology to connect IoT devices directly to low-earth orbiting satellites. In respect to the business model, the business model is also very, very simple. I think you've heard the word reoccurring revenue throughout this presentation. But the way our model works is very simple. We're selling our customer a terminal or an IoT module, which is a piece of hardware and a piece of firmware that they can embed into their sensors and that product called Wyld Connect allows data to be transferred or delivered to satellites and then we charge our customers a monthly fee for operating that service. So that's where the reoccurring revenue comes in, in our business model. Obviously, as we're focusing primarily on that 85% of the world service where there's no access to the Internet. Our markets, our transportation, agriculture, environment and maritime. And sort of just to let you know where we are at the moment, we launched Wyld Connect in Q1, which is our IoT module and terminal. And we're launching the service in the second half of 2022. But already, the hardware piece has been launched to the market. And we're actually in sort of commercial test phase with I believe there's about 20 to 22 customers. We're going through commercial test phase with. There are launch customers and then customers such as Bayer, Fujitsu and Chevron. As I said, the service -- this actual service is going to be launched in the second half of 2022 when we start to charge that reoccurring fee for actually using the service. At the moment, we're basically building a pipeline and a pretty robust pipeline of purchase orders. And to date, in Q1, we launched Wyld Connect and to date, we've gathered purchase orders of about DKK 28 million. So what does it look like? And I talked about satellite IoT. And -- but our solution is more just satellite IoT. We're providing a hybrid terrestrial LoRa satellite IoT solution. So you see a picture of Wyld Connect. It looks like a terminal. And natural fact, that's a third part. That's a Wyld terminal. But in reality, it's the electronics inside it that we're integrating into sensors. Now that device Wyld Connect will not only just connect you to a terrestrial LoRa network. As I say, once you moved out of coverage about 15% of the world's surface, it will then look for a satellite and deliver that data to satellite. That satellite will then basically deliver the data back down to a ground station and into a product that we have called Wyld Fusion. And Wyld Fusion is our provisioning platform and the payment platform. So that's the platform that our customers will log into to get their data to visualize their data, and that's the platform that provisions Wyld Connect and also is the payment platform for our recurring revenue. So where's Wyld going with satellite IoT, and I've just outlined a few verticals and quite a number of different applications. But there are multiple applications in agriculture and environment, energy, maritime, transportation and logistics. And so the market reports point to a market that's started in 2021, growing to about GBP 5.9 billion in 2025, and that's focusing primarily on satellite IoT. We're basically looking at a number -- if you take that $5.9 billion, we have done our own work and looking at what does that mean for Wyld? Well, for Wyld itself, we're looking at about a market by 2025 of revenues of about USD 650 million. And as I said, we're actually in the test phase with our launch partners and looking to launch the full end-to-end satellite service in the second half of 2022. And I just want to go through 3 different use cases. I showed a lot of use cases on the previous slide, but one of the use cases and where we've already collected orders for so far in Q1 is in agriculture, in integrating our IoT module into soil moisture sensors. And this is really about sustainability about how to increase yield, reduce and optimize inputs and improve sustainability. And as you all know, the world's population is set to grow by about over 2 billion people by 2050. And thus going from 7 billion to 9 billion people. And today, we can't even feed ourselves. The other data point is agriculture is responsible for about 30% of the waste and water globally. So it's a big problem that needs to be addressed. How we can feed this population and how we can do it sustainably. So we're working with customers, and we are seeing purchase orders integrate our connectivity solution, our satellite IoT solution into their soil moisture sensors. And already, they've actually proven that by actually collecting data from soil moisture sensors and actually optimizing the irrigation in farming can actually increase the yield of crops by up to about 37% and also reduce the consumption of water by about 30%. So there's huge gains to be made out of taking this technology and deploying it into agriculture. So that's sort of a sustainability use case. I want to move to the sort of contactless use case, and this is one that we're doing with a large oil and gas or energy provider in the U.S. And just to give you an indication of some of the costs that some energy providers are actually paying through spillage of oil. BP paid up to $60 billion in 2010 through quite a substantial oil spillage and that didn't actually include the cost and the massive impact on the environment. So what we're doing with these energy providers is basically looking at how we can use our technology to monitor corrosion within all pipes so that we can do preventative maintenance. So we can -- our customers can understand when they need to go out and look at replacing parts of pipes, ensuring that they can actually reduce the downtime and ensuring they can actually reduce the amount of spillage. So that's sort of one type of use case that we're sort of engaged in, in the energy sector, which is really corrosion monitoring. As you can imagine, a substantial number of these assets and oil pipes and gas facilities are in locations where there is no connectivity through traditional terrestrial coverage. And as you know, this is a deal that I want to just talk a bit about, and this is a consortium that we put together in January this year. And this is all about frictionless use cases. This is about the supply chain, this is tracking assets and the supply chain. And just to give you some pretty incredible numbers, $2.4 billion of cargo was lost or damaged each year just at sea. That's a huge number, $30 billion worth of cargo was stolen and 81% of businesses experienced one supply chain disruption each year. So -- we put together a consortium, it's called the MIMIC consortium, and it includes Eutelsat 2, who I'm pretty sure you all know is our satellite partner. But also included a company called Senate in the U.S. and Senate is one of the largest or is the largest LoRa terrestrial provider in the United States, and they also operate in another 72 countries around the world. And so we put this consortium together where Eutelsat has the low-worth opting satellite solution. Senate has the terrestrial LoRa capability and Wyld provides the communication. So we're providing all the communication from all of the sensors to satellite and basically going to our customers with a complete 100% global solution with a hybrid terrestrial and satellite IoT solution. So I talked a bit earlier about who our launch partners are. And we've got a substantial number of launch partners. And launch partners are customers that are testing our solution at the moment, and we're also engaged with these launch partners to actually convert them from testing our solution to actually getting purchase orders ahead of the launch of the commercial service. So we're working with some pretty large companies from Chevron, Bayer, Fujitsu, Senate, as I talked about earlier on. And these are customers that have signed contracts with the Wyld to test our solution or pilot our solution and engage with us commercially so that when we launched the service in the second half of 2022, we're actually got paying customers on the network. So customers so far, I talked a bit earlier about the fact that we launched Wyld Connect, that's our satellite IoT module. That's the hardware and the firmware piece that gets embedded into sensors. So we launched that in Q1 this year. We've got orders. There's a list of customers there. We've got orders so far in Q1 of about DKK 28 million. And those orders don't include the monthly service. So that doesn't include the 5 month -- the $5 a month service fees. That's simply for the Wyld Connect IoT module. And when we launched the service, then obviously, these companies will be paying us a monthly service fee for actually using the network. So at the moment, we're going through all of this testing. We're converting these customers who are testing our solutions into purchase orders, and we're going to continue to generate further purchase orders through Q2, Q3 and to when we actually launched the end-to-end service. So in summary, I just like to sort of say a few things. One is we are solving a real-world problem. We're providing connectivity for access to the Internet anywhere in the world. We're launching the commercial service in the second half of 2022, and that's the commercial service of not just providing the Wyld Connect connectivity piece but providing the global coverage to the satellites, so there's actually a complete service that we're offering our customers. We have, as I said earlier, a business model that has a one-off fee for the hardware IoT module, which we're basically selling at the moment. And then there's the reoccurring revenue model through the service or the monthly service fee that our customers will pay when we actually launch the service. With signing agreements, we're securing purchase orders, taken to filed. I talked about us working in a large market, and that's a market that's forecast to grow to about USD 5.9 billion in 2025. And we believe with the work that we're doing at the moment that, that sort of puts us in about USD 670 million in 2025 market that we're going to try to go after. So hopefully, you've got a better idea of what Wyld Networks is doing and an update on where we are with the market. And I'll hand back to Tim and questions and answers.

Well, thank you very much, indeed, Alastair. Fascinating presentation as always. We've had a fair few questions through, but there is a little bit of time for a few more. We've got sort of 10, 15 minutes for the Q&A session. [Operator Instructions] As you just finished, Alastair, we might as well start with a couple of questions for you, if that's okay. First question asks about some data security. You mentioned that Wyld Connect uses a free spectrum. How do you ensure that the data for users is actually secure?

So we use -- it's a good question. So we use LoRa as a technology or LoRaWAN as a technology and it has its own encryption built in as a standard. But we've actually done more than that. We really want to go to our customers with secure connectivity. So Wyld Fusion itself is a platform that I showed on a previous slide, actually generates keys and those keys are rotated amongst all the devices, the Wyld Connect devices on the ground. So we provide some pretty secure security across the whole end-to-end solution.

Okay. And the question here asks about the cost competitiveness of what you're offering. Obviously, massive benefits can save people an awful lot of money. But do you think it's going to remain cost competitive for the benefits they can provide as technology moves on in the coming years?

The cost -- with the Wyld technology, there is cost pressure. Let's be clear about this. But our goal at the moment is to offer a significant return on investment for our customers, and that's already been proven. People are placing substantial purchase orders on Wyld. And as I said earlier, we have basically taken out of the cost equation, the whole cost of paying for regulated spectrum. So as I said, our competitors that are offering a solution using regulated spectrum. I have to pay each country all over the world, a big chunk of money every year to actually use that spectrum. We've taken that cost out of our offer. So we are way ahead when it comes to offering a competitive satellite IoT solution to our competitors. But I'd say that pressure will continue, but our ambition is to have billions of these devices out there. So at the moment, we're offering our customers a price of $5 a month to actually use the service. But yes, we will see pressure on that. But that pressure is good because we're looking to deploy, as I said, millions of devices out there.

Excellent. Well, thank you for that. You talked about the launch of the service. Can you just give us a little bit more detail on what's actually in place at the moment in terms of everything from satellites to sensors and what you've been doing with your particular customers?

Yes. So at this moment, we launched Wyld Connect. Wyld Connect is our IoT module. So that module is a satellite terminal, and it gets embedded into sensors. So we're already selling that product to sensor manufacturers, and that's where the orders we got in Q1 came from. So Wyld Connect is already in the market, we've got customers buying it and those customers are integrating that product into their sensor that device sends data from the sensors to the satellites. So -- that's already commercial, that's being sold. Customers are buying it. And obviously, what we want to do is to get as many of those deployed into sensors as soon as possible before we actually launch the service. So at the moment, there's satellite availability and there's about 4 satellites at the moment that are providing connectivity. And obviously, we're looking to launch the service, deploying more satellites, launch a service second half of this year and continue to launch more satellites. Our sort of concept on where we're going is to have about 24 satellites deployed. And that would basically give us connectivity anywhere in the world every 1 hour. So you understand where we're focusing on. We're focusing on those use cases where data is very important. But it's data that has a relevancy of about 1 to 2 to 3 hours every day.

So when you talk about global coverage, you mean global coverage. So even remote areas, polar regions, you've got well, have polar orbiting satellites. We're talking about the whole world here potentially to be?

Absolutely. These are low-earth orbiting satellite. Each one of them goes around the world in a different plane every hour. So each satellite will cover the whole globe. 100% in 24 hours. So if you have 24 satellites up there, then you basically providing connectivity anywhere in the world every 1 hour.

Thank you. It's often a question I get that when you say the whole world, do you mean the whole world and obviously, you do. So thank you very much for that. Barry, I've had a couple of questions for you. We talked about the synergies with Tern and the partners working together. Could you just give us a little bit more color on those and where you see the benefits of the relationship.

Yes. Of course, I'd be delighted to. And perhaps I might start, Al, you might jump in as well as we're talking about synergies. I mean, I think the starting point is we have very similar investment strategies and very similar visions, covering the entirety of the U.K. in these massively high-growth sectors, and we've seen today IoT and security and also we're interested in AI and Metaverse as well. And so one of the ways in which I think we add value is we can be seen as, if you like, a scale for Al and the team for co-invests, but also sometimes catching companies at an earlier stage and as they develop, then Tern can come in and come in at the Series A route. But similarly, on a synergy point of view, we've already met the team a number of times, and we're talking about how we can share contacts, share leads, share opportunities. So it's a genuine kind of team coming together to go out there and find the best and best of technology opportunities. In addition to that, in terms of sharing networks as well, we all have networks across the globe, which can help the companies that we're investing in and bringing together the best of Tern's network and our network reaching from Silicon Valley to London to Asia as well. So we see that as very important also. And then actually, one of the things that we love to do is to encourage our portfolio companies to collaborate with each other. So there's a larger group there of companies working together as well, sharing knowledge, sharing opportunities as well. And then, of course, we've got our advisers. We've got a very large adviser group that can come in and help companies also. So we'll be adding to Tern's and Tern will be adding to ours as well. Now Al, if you want to add to that?

Yes. I think what's important here is what you just pointed out in that we have a belief in having a synergistic portfolio. Portfolios of companies or the companies in the portfolio, they can share technologies. And one quick, for example, is, if you look at the recent investment in RETìníZE by Sure Valley Ventures, there are aspects of that technology that we believe can and will give fundamental surgery, potentially a huge competitive advantage because understanding the movement of the eye and really creating this capability that RETìníZE has can accelerate the programs that fundamental is putting into place. So we have an overlapping network. We have technologies that are components of other businesses within our portfolio. And I think as we progress and learn more about each other's businesses, this has tremendous value for our shareholders and for each of the investors in Sure Valley Ventures. So it's, I think, something that will have impact for years to come.

And just another one for you, Barry. You mentioned the Metaverse, something that we're reading lots about. It's obviously -- Facebook having changed their name. People are talking about it. what do you see the potential there? And what sort of companies might be of interest to Sure Valley value in that area?

Well, that's a really interesting question. I mean the Metaverse in many ways is a kind of a catch-all term these days as well. I mean I don't know if anybody saw the kind of Facebook event that Mark Zuckerberg ran where he presented one version of the Metaverse, which is a very Facebook-centric version. But for example, it does include VR sort of fundamental, for example, would be part of that. It includes AR as well. And it's also starting to bring in decentralized technology or Web 3 technology as well. So I saw a report recently that estimated that over the next 5 years that Metaverse could grow to be a $1 trillion business area. So there is really massive market potential there. But in terms of what I think I see near term, it kind of breaks down into we're seeing a dramatic acceleration of VR, and we see that fundamental is a great example of that. We're seeing a dramatic acceleration of AR. So one of the previous companies we've invested in is a groundbreaking AR technology company based out of Cambridge. It's a spin out of Cambridge University. And so over the next couple of years, you're going to see phenomenal VR and AR devices. There's new headsets coming from Meta and from Oculus. Everybody knows Apple has got an amazing product coming out later on this year. And that's going to drive -- and that's a mixed reality product, so that's VR and AR. So that's really going to accelerate the market as well. But also, you're seeing also a gaming merging with these technologies as well. So if you think about that vision that Zuckerberg showed, it has a lot of gaming technology built into it as well. And gaming as an industry is bigger than music and movies put together. And it's not just video games, but the underpinning technologies are important as well. So you're going to see opportunities in advertising, in animation, and in enterprise uses of both Metaverse, kind of Facebook-style Metaverses and also enterprise AR as well. And then longer run, I think we are going to see more and more of these Web 3 decentralized technologies integrated. And you're starting to see that on the fringes of gaming already would have an area of gaming called Play-to-Earn games. So right now, the biggest area of gaming worldwide is free-to-play, driven by mobile. That's where you can download a game for free and play it. That now turning in on the Web 3 side into you play the game and you actually earn by playing that game. Typically, you're earning some sort of cryptocurrency. So other areas we see growing are end-user tools as well. And AI in -- for animation and also in terms of AI, industry around AR as well. So -- whilst it is a catch-all term, it does encompass a lot of what Tern already does and what we're interested in. We tend to be interested in more concrete technologies that can be sold as a platform to generate ARR. But there's lots and lots of opportunities in that space. And I do think we're starting to see it become prime time and starting to see the acceleration of technologies to create a very, very large market opportunity. But lots of -- it's kind of the modern convergence space. When I founded Feed Henry, that was in the last wave of innovation, which was mobile innovation. And what came together to make the iPhone that was an amazing convergent product that brought together chip technology and optical technology and wireless networks and software technology into something that grew exponentially. It's one of the fastest-selling products ever. We're now getting to the point where all these technologies are coming together from Metaverse. So I see very shortly, we're going to see that exponential growth as well. Wonderful opportunity for all of the companies that Al and the team have invested in and all the ones that are going to invest in -- together over the next couple of years.

Thank you, Barry. That's very helpful indeed. I've certainly learned something there. Alastair, just going back to you. Just got one question if you're still there? Yes. Excellent. We've got a questioner here who says, obviously, heavy dependence on Eutelsat. In the event that Eutelsat was acquired by a competitor or there was a reason why you couldn't use their satellites. Is there any redundancy? Is there other satellites that you could use should there be any issue with Eutelsat?

We -- first of all, our technology works with all the Eutelsat satellites, and we'll continue to do so. So it uses a standard technology. But yes, we are engaging with other satellite operators as well to broaden our reach into other use cases.

Okay. Thank you. I think that's addressed that one. Al, I've had a few questions as we often do at these sorts of events on more general turn points, a few of which were covered at the AGM, but I recognize that a large portion of the attendees here weren't able to make the AGM this morning. The first one is an often asked question about why isn't more financial information provided on the return companies. Could you just give us a little comment on that perhaps in the same way as the comment was given earlier today at the AGM?

I think to be crisp and clear and Barry can vouch for this as a fund manager of a venture fund. The companies that we invest in are rapid growing companies that are in very, very competitive markets. And as part of what we do in making the investment in the company and getting the companies and in some cases, the existing investors in the companies to allow us to be part of the business is to, in effect, guarantee that we won't release sensitive financial information about the company and the business. These nondisclosure elements of the share purchase agreements are a critical component that young startups and their legal firms look for because it's very damaging to them if their competitor picks up on some of the information. And as we said this morning, even at Companies House, the information that Companies House requires here in the U.K. is de minimis in information that would reveal to a competitor significant information and strategy about what's happening within the business. So as we help develop these companies, we also think it's important that we adhere to the policy and practice that is what is the way of investing and seed an A-round businesses as they become bigger businesses and hopefully returns for our shareholders.

Yes. Thanks, Al. And Barry, I presume you would agree with that and the information that an investor in Sure Valley would get, would be similar to an investor in turn.

Yes. I mean it's always -- I would agree with Al. It's always a very fine balance. The companies generally don't like to put out a lot of information. They'll -- they're quite happy to talk about the products that they're developing and where those products are going. But generally, they don't like to give out customer information or financial information, whilst our growth companies because of competitive reasons. I totally agree with that. So it can always be -- and it's great actually that being for the Wyld gate, for example, Device Authority gate because they give a lot of customer information out. It is something that we do work with companies we invest in to try and encourage them, but the companies are kind of private for a reason that they want a period of time where they can build and experience rapid growth without giving too much away to their competitors. And software is a hypercompetitive area. So the companies are always paranoid about confidential information for good reasons.

Sure. Sure. Thanks, Barry. That's very helpful. And now moving back to you. We often get a lot of questions. I've got a few types in today about time lines. And obviously, great progress being made by all of the companies. But how do you, as a Board, balance that and the value tomorrow with value for shareholders? Is that something that's obviously been regularly considered, but do you have any metrics that you're using to balance those 2 things?

Well, I think the key metric that we look at is MRR or ARR, the recurring revenue. If you look at some of the recent reports from Morgan Stanley and Goldman Sachs, particularly in the SaaS software arena, the multiples or the baseline multiple for valuing a software company is in the range of 10x the annualized recurring revenues. So at Tern as a Board and as investment managers of the portfolio companies that we're in, we are constantly on a monthly basis, looking at both the recurring revenue, the trend in the recurring revenues, the monthly recurring revenues as well as the long-term value of the contract. They're also part of the -- Darron, for example, talked about a customer in the medical arena. Those contracts are generally 5 years in length. There's a scope of rollout within the nature of that contract that we generate revenues on a quarterly basis. We evaluate them on leading their forecast on a quarterly basis, annualizing that, looking at the value of the business and then trying to determine when the customers -- that organization also beats another metric that we use the Rule of 40, and the Rule of 40 is an area of where the revenue growth minus the EBITDA is 40 or better. So as we go through that phase we can fine-tune where we believe a company is at a place where growth is now going to require some bigger brother to get it force multiplication. And that would be the opportunistic time to bring that company to a sale or to an exit. But what also we do is our companies are for sale every day. And one of the ways to exceed that 10x multiple is to have an unsolicited offer come in for the business because every one of our customers, we work very hard to create partnership arrangements like again, we'll use Device Authority's, arrangements within trust. There's some arrangements now in a strategic investment from Venafi. There's arrangements with Microsoft. When an unsolicited offer comes in, and this is why we do these partnerships and why we try to create these co-marketing arrangements and co-selling arrangements. It creates attention between the unsolicited offer and the other critical components of the partnerships that we have, such that hopefully, a bidding situation arises and when a bidding situation arises, we can exceed that 10x sort of standard and get 15, 20x multiples on the revenues. So we are focused every day, every month, every quarter on the trends within the recurring revenues and the trend in the Rule of 40 to make sure that we don't miss an opportunity. But we're also in our relationships and how we drive the Board meetings because again, we don't run the companies where advisers as board members to the companies we invested how we help motivate them to create a dependence and a tension between their partnership arrangements such that at some point in the future, if someone should pull the trigger on an unsolicited offer. We're in a position to maximize the value we can generate from that potential sale or opportunity to our shareholders. And again, the other side of this, as we did within the case of Wyld, there's also a function here where the capital required becomes so rich that an IPO becomes the real answer because an IPO letter stay as shareholders as in the case of Wyld. But now Alastair has been able to go to the public markets on NASDAQ North, raise additional capital without diluting our position. So there is a case where looking at the deployment of the satellite business and creating the virtual network operation that's going to be required to make this business go picking a place like NASDAQ North with a rich history in telecommunications and strategic investment is strategic institutional investors there to back it, created a better opportunity for us to maximize our returns by not having to sell our shares but by bringing the public markets to create value for our shareholders. So that exit I think we'll have many, many, many more returns for our shareholders without us having to invest any additional dollars. So that's the trajectory and the balance we use in evaluating when and if to pull the trigger on the sale or when and if to pull the trigger on an IPO to create value for our shareholders and not lose the opportunity to continue to have that value developed and deliver. Yes. I hope that helps.

I think so. I think so. I've had a couple of questions just in if that value is created, how is it returned to shareholders? And I think as you said at the AGM, it depends on specific circumstances but dividend, share buybacks, and that's why we've got the authority today, or whatever is appropriate at the time, but never prejudge it.

We're not as clever as the HMRC to try and take away returns. So we will deal with it at the time.

Absolutely. Well, thank you very much. I'm conscious that we're now a minute past the close time, so I'd like to thank Alastair very much for the Wyld presentation. But most of all, Barry, thank you very much for you joining us this evening. I think I found that extremely helpful. Al, thank you. I'll pass on my thanks to Darron for the presentation that he's provided. But as always, there's obviously a few questions there that we can't answer for regulatory reasons. There are a few that we probably haven't answered in the depth that you would like. So if you have anything further, please do contact me at any time, contact details on the bottom of any of Tern announcements. [email protected], and we will endeavor to come back. But most of all, I'd like to thank everybody for joining us this evening and wish you an enjoyable rest of the evening. Thank you very much.

Thank you.

Thank you.

Thank you.