Verve Group SE (VRV) Earnings Call Transcript & Summary

A warm welcome to Media and Games Capital Markets Day here in Stockholm. It's great to see everyone back after summer. And I mean, this day is both online and also here at Opera [indiscernible]. So my name is Jenny Rosberg, ROPA. And I support MGI here on the ground in Stockholm. So I will facilitate today's session. And today's session is on the back of a very strong Q2 report released yesterday. And the company outperforms the already strong comparison quarter last year, right? And the management has been very active during the pandemic, doing deals and also financing deals. So today, we'll be all about getting to know the people behind the deals and also the growth strategy going forward. As usual, on Capital Markets Day, we will have lots of slides in the presentation. But we will also have Q&A sessions in between. So if you check the agenda, we will have a Q&A session after the deep dive in the games segment. So please engage all of those who are online and prep your questions, send them in and also here in the room, so we really get a live session here today. We will also have a Q&A session after the media, deep dive. And then at the end, we will also open up the phone line so you can dial in. And we will show the dial-in numbers on the screen. So I think actually, without further ado, I would like to welcome you up on stage, Remco. Great to have you here in Stockholm. And with that, I would also like to hand over...

Thank you, Jenny. Yes. Welcome, everybody, and thanks for coming here, and thanks for zooming in or how do you say it, interneting in. Great to be back in a life event. Yesterday, you had some live interviews, and that's really, really cool to see people moving again instead of on a Zoom conference, but really life and also here. So really happy that you're here. And sorry if I doubt that couldn't make it. And that's the reason you have a hybrid Hardie conference where also people can, of course, go and get in via Internet. I would like to get you through a bit of the more general things. And then after me, the people that are really doing the work will show what they're doing, what is happening -- what has been happening in the last quarter. And altogether, I can say we are really happy with the second quarter, and looking forward to do some more good quarters actually. So let me go through the presentation. As Jenny want already, it's a lot of slides, but here. What is the aim of the Capital Markets Day? Basically, to give a bit of an update to share deeper insights and also give you the possibility to ask questions because I know we are really asking a lot from our investors doing gaming, which is already not that easy and then also doing media, which is even a bit more complex and then even trying to -- or not trying even combining the two, which is even making it more challenging to understand. Then I'll provide an overview of the financials. Of course, actuals, outlook and getting to know the team. let's say, part of the people are here to start of where we are here today. And of course, we have many more, but I think that's a good opportunity. You all and most people here in the room know us, but for those that don't, maybe looking back a bit. It's always amazing how fast time goes. We started this in 2012. Gamigo was owned by Axel Springer. It was a distressed media company and an M&A adviser calling, do you want to buy the company, they want to get rid of it. Original idea was just restructured, sell it and do something else, but it was the start of where we are here today, and we really give me a great ride. We have now a combination of gaming and media. In both segments, we focus on sustainable revenue streams. So games that have long player lifetime over players are really in for a long time. And also on the media side, customers that stay with us for a long time in mostly SaaS models. That makes life a lot easier because if you have a business model where you have to acquire the customer all the time again, it's much more -- much less steady and much more expensive, of course, for a customer acquisition point. Then a bit of history. Yes, we started and that was really very well thought of in the beginning only to build critical mass. If you want to be successful in gaming, you need to have a certain size. If you're small gaming company, and that was what gamigo was when I came in, they had 2 games that we were preparing for launch. And I said, okay, today, the company sucks, but after this, we will be the kings. And then there are 2 failures. And that's really what's happening a lot in gaming. Gaming, you need a portfolio approach. There's over 2,000 game launches each month. And if you can only bet on 2 games to launch, you shouldn't get into gaming. So that's the reason that we said we need to build critical mass. And that's the easiest way was to just buy companies, integrate them and by that, to build it. So that's also the reason that the first 4 years after we started, we didn't have any organic growth. We didn't even focus at it. After that, we started to focus on it because, of course, investors are asking, yes, it's nice to buy. Everybody can do that but you need to show organic growth. And I think we have really been showing that we were able, since 2018, to have more and more organic growth each year. Then step 3 was [indiscernible]. The second success factor for gaming is users, getting new users in the game, launching games, where you also need users for, which is media. And that's the reason that we said, yes, we want to get stronger on the media side, on the user acquisition side, also selling ads. And that was when we started to build up the media arm. And now, let's say, the step 4, where we are is really an integrated gaming and media company, where there's still much more potential in further integrating and further working together. Some financials, Paul will go through that much more later. 40% year-on-year growth since 2014, over 70% year-on-year growth since 2018. Yes, EUR 109 million revenues in the first half year almost doubled versus the first half year last year. So we're really happy with the numbers. And it's not only about revenues, of course. It's also about EBITDA and also have been able to increase the EBITDA margin. listed since 2018 in Germany. That was a difficult right to really convince German investors that gaming is school and that the micro cap is worth investing in. It was not easy or let's say, we were also not so successful in it or whatever you look at it. So we're really happy that in October 2020, we did a listing in Sweden at NASDAQ here. And yes, we were really very well come. And that's also the reason that we're doing our Capital Markets Day today in Stockholm. We're really extremely happy to be on the stock market here. And also 3/4 our trading volume now is in Stockholm and only quarter in Germany. Yes, it's -- you often see me or you see Paul, but there's many more people in this company with over 900 employees in over 25 locations. And I want to give a little bit of guidance already. And of course, what's next? We're growing fast, but we would like to get to a kind of EUR 500 million revenue within the next 3 years. If you look at our speed of growth, that should be possible. latest in 3 years, we would like to be there, but we're working on it. So going into detail a bit of who is this company, the Board, quickly introducing colleagues, Antonios on the right. Our latest addition is a Board member at Freenet, a mobile company, marketing background. It's really strong on the marketing side, independent director; Elizabeth Bara, a Canadian national living in London -- sorry, undone living in Germany, a little bit background in fund management. So very strong on the financial side. And to be as living in Germany, Dusseldorf, also independent Board member and having a background mostly in company communication, governance and as such. We have a really nice team where I'm then the fourth person, but also the executive part, a bit deeper into the organization, where the work is done. Yes, our team, our top team, Jens over there. Paul, over there. Jens Christian Fritz, who just joined the company, but he has to work because we work in some M&A. So he wasn't able to join. Then Maren Fischer, our Head of Legal; Sabrina Gründemann taking care of all the operations or the offices Ester being here of Investor Relations and also ESG and Soren also being here, Investor Relations. And then we have, let's say, brought a company, we are integrating what we buy, but we have 2 units, the one is gaming and the odroneis media. And on the gaming side, Jens is heading the part with Andreas, Miguel, Mervin, Thomas and Ulrike joining HR. And on the media side, we have Sameer, Chief Revenue Officer, Ionut Ciobotaru, Chief Product Officer; and Stephanie Vandenberg, heading our sales based in the U.S. and Malgorzata Adamczyk officially heading HR part. So that's basically the top team managing the company, and let's say, many more than that. A bit about the owner structure. Yes, it's not very polite, but I'm still holding quite a bit of the shares of this company with also colleagues and also board members. So that's really nice to have ownership also here. There's a lot of light interest, I think. But we're really, really happy that companies like Oaktree, Janus Henderson, Avanza, but also now a BlackRock and even the Fidelity are, let's say, willing to invest in our company and are trusting us to make more out of their money. So also, thank you for that, and we are, of course, working on further increasing our investor structure. Factsheet, yes, this is boring. So I don't go through this too much. I mean this will be on the Internet. But office is in Malta, that's a point that I would like to emphasize. We are going to change that. That's something that we announced already. We want to get out of Malta because of the image of Malta and also we see that they are not that quick if something needs to happen on the more, I'd say, formal side. So relocation is a high priority for us. We wanted to move to Luxembourg, but then Euroclear has kind of killed that initiative because they have announced that they don't take any new countries that they will accept. And we don't want our investors to get CDRs instead of shares because that would have been the only alternative. So what we are doing now, we have choice out of 5 countries. And at the moment, we are with lawyers with tax specialists with governor specialists looking at what country it will be, but it will be, let's say, a more clean country than multi-imay say so. So that's what we're working on. That's really a high priority for us. Ideally, we would like to do it by the year-end because then we don't have to have different accountants during the book here, but that's a high height priority. Then we have Asia, that are the only shares that are listed we have B shares as a kind of reserve that we can use for M&A or for stock option programs, these kind of things. They were just allowed or, let's say, also got into the books this year. Market segments, Frankfurt and Stockholm. We have a German bonds, EUR 25 million, also a few words about that. That's an unsecured bond, we want to buy it back in October this year. So we can buy back prematurely, and we would like to make the structure a bit easier with only having bond in a secured bond in Sweden, which is the Nordic bond up to EUR 350 million, where we announced yesterday that we want to tap it. We now have, let's say, issued [ 270 million ], and want to go to the [ 350 million ]. Research coverage, yes, quite a lot. In the beginning, we had to pay for it. Now we get it for free, it's also better. And also the banks have come up. So yes, happy with that. And also thank you, analysts, and thank you, banks for supporting us and covering us. And indexes, yes, we are I'm not going to read it. So speakers today, maybe very quickly, Paul 2 words 3 words about yourself.

Paul, Media Games Investment were a start-up company, then investment banking. And since 2017, CFO of Media and Games Invest and leading the financing Controlling and Investor Relations part.

Jens?

COO of MTI and CEO of gamigo Group. I joined gamigo MGI back in 2012. I'm taking care of the whole game segment, Linen Hamburg, and I like it here the weather is very comparable to where I come from. So yes, happy to be here.

Ion?

Hi, everyone. Ionut Ciobotaru, I run product and engineering for the Verve, which is our media side. I joined 2 years ago through the acquisition of my start-up, which was a mobile SSP based in Berlin, and I'm based in Berlin and have been in adtech I don't know, over a decade or more.

And Sam?

My name is Sameer and I am the CRO for the Media Group Work Group. And I think one of the best decisions of my life that at Crazy times, I joined the MGI World Group last year. And I am really proud of that. I run the commercials, the marketing and the operations for the Verve Group, and we are on a role.

And then the people that are mostly in the background, and we therefore always forget to mention, but it's Esther, Investor Relations and Soren. Then business update. I'll go through this much faster because they gave me 20 minutes for 30 slides, which is, of course, not enough. But I'll go through. So over 35 M&A transactions. The market cap has gone up substantially since we are listed in Sweden. So we're really happy with it, but we now have the problem that in some portfolios, we have become such a big part that they even had to sell our shares because they were not allowed to have this. But that's a luxury problem, I would say. Employees, I mentioned the 2 segments, yes, games, overtime so-called massive multiplayer games, people in there for a very long time, really tied to the game, but we need to treat them very well, of course, and to give them always new content and to be really interacting with our gamers. Casual games, mostly in subscriptions or advertising based and allover 100 million registered gamers. On the Media segment, yes, the number is really huge. 166 billion ads delivered in the last 12 months. working for over 5,000 advertisers. We're talking about computers electronics. So this is not manual stuff, I mean, otherwise, this would, of course, not be possible. Revenue I talked about EBITDA also, Paul's going to go more into detail. And we are, at the moment, almost exactly 50-50 media and games. If you look at the Q2 segment, and we have almost become a U.S. company with 63% of our revenues in North America, where we really see that it's a huge market where scaling is much easier than, for example, in Europe, where you have all the different languages, all the boundaries and everything. But still, 24% in Europe. And also rest of the world, we are getting stronger. And in the end, we grow where we see good possibilities growth, of course. Yes, a bit of the history, we started in 2012, 8 years ago. Bodkamigo restructured it. And then instead of selling it, we decided to further grow it. Important points were, for example, in 2015, where we did quite some gaming acquisitions in 2016, we acquired [indiscernible] Games, which was on [indiscernible] big media house in Germany. Was burning EUR 1 million a month, so it was really a bit of a -- not really that risky because we knew that we could sort of restructure it, but it was exactly hitting our EBITDA a little bit when we bought it, but it was, let's say, cash flow positive in 3 months. But that was a really bigger step where we bet to make a bigger step forward. Then we got to bond, although we got an early bond already. First year as I said, only building critical mass doing acquisitions, over 20 acquisitions in the first 5 years. Then we decided to bring everything under a listed company, which is Media and Games Invest or we did basically back to our listing. That's -- so the majority of gamigo was brought in and the rest was acquired later. And yes, we saw first organic growth. So in 2018, we really -- 2017, we started focusing on it. And we have more and more organic growth initiatives, and that's also what we see now with 36% organic growth in the last quarter. We're really happy because Q2 last year was very strong already because of corona, so that we really were able to grow so fast is very nice. A lot of things in between, not going into detail. Otherwise, I will not make my too. The last 12 months, I think that's more important to talk about some acquisitions, platform 161, but the listing in Sweden, very important, of course, acquisition of liquid, acquisition of Kings acquisition of Beam Ray, acquisition of Smarter, which is not yet closed, but we just got the okay from the Chinese government. So we are now doing the last steps, and we hope that we can even close it by 1st of September, latest 1st of October. So that's what we're working on. But really nice acquisitions. Our acquisitions also -- the kind of acquisition changed a bit. We did a lot of distress when we started. Now with our higher valuation, it's easier to get -- well, let's say, it's less dilutive to get access to capital, and it really makes sense also to buy EBITDA-positive companies, which, of course, makes rose faster. That's what we're also seeing. A lot happened also on the capital markets side, the bond issue, tap-off the bond issue to bring that forward and not to forget also the ESG side, our governance report will be published most likely next week and sustaining ability report has already been published. So also there, we are working on becoming a more mature company actually. And I mean that's also what we see starting with a distress company. If I see what proliferation we have done, how the company really has been growing with many more shoulders that the management has shared on, really great to go forward, right? So strategy, yes, nothing changed here. We still buy, integrate, build and improve. That's what I'm telling, I think, for the last 6 years at least. Yes, what do we do? We look at markets. Markets are consolidating. Gaming markets consolidating. The media market is consolidating. There's many companies that are just subscale, too small, lots of targets in those markets. But of course, you need to look what you buy, does it makes sense. Then we integrate the companies. That's something that we have said also from the beginning because if you do so many acquisitions and each company would be stand-alone, you get all kind of kingdoms and you don't get the real synergies out of it. And then build and improve with what has been brought together has been integrated, it's about organic growth and going forward. Why do we integrate? Yes, technology is one of the big things. We really get big savings from individual data centers per company towards -- bring how to say, service into cloud. And we see that on the gaming side as well as on the media side that we are able to really get big savings on that. Trion World's an example of a distress case that we acquire. Here you see really -- yes, company was burning EUR 0.5 million a month when we took over, but we took only roughly 50 people out of 300. We stopped all the risky projects. We concentrated on only a few games, but we invested in those games. So we were able to really get the burn rate out very quickly, make the company profitable very quickly and also even bring it to organic growth in a very fast time. Yes, M&A, I mentioned already, we have so-called tick-the-box slides to show a bit what we are focusing on. We still should be realistic. I mean gaming is $170 billion worldwide market. We're not on a conquered world. So we need to also focus on segments that really makes sense. So on the gaming side, we go more for core games, for free-to-play games because you have less customer acquisition cost. Also built -- buy-to-play, also advertising base that has become more important since we have the media part as well because we can sell the ads better. And also some subscription base, so basically on the business model, we are having a combination between different ways of earning money because you don't want people to spend too much money in the game, but you can also make additional money with advertising or even give some extra perks if you give a subscription, a VIP club and things like that. On IP license. What we typically do is if we launch new games, we don't develop new games because that's still too risky. We think we're still too small for that. So we rather have third-party developers who develop the game. But if a game is successful, we like to have it in-house. So then we like to buy the IP. So that's what we also have done in the past. Also when we did acquisitions, we first buy the publishing rights. And then when the game is successful, we also like to have the development rights because then we can treat the game more in the direction where we want it. And mobile, to mention -- but Jens will also say quite a bit more about that. We will focus more on mobile games as well. We want to go deeper in there. Historically, I would say the valuations for mobile game companies were extremely high. That's the reason that in our M&A, we concentrated mostly on online companies and also console companies. But now with IDFA and a lot of spook in the market and people afraid, et cetera, we have seen that valuations for other companies are coming down substantially. And that's also the reason that you will see in our M&A list that we have quite a bit of mobile targets. On the media side, a bit different tick the box slide. Here, we're working on a full vertical integrated media house, digital programmatic, which means it starts from creative -- And then, let's say, you have brand and performance marketing, so 2 different ways of marketing and then the technology stack, which is DSP, DMP and SSP basically, with the exchange network in between. And that's, let's say, Ionut and Sameer will tell much more about it where I go into detail and yes, we double. And here also, we do that not only for in-app, but we also do it for web -- mobile web, for CTV, OTT and for digital out-of-home. Where you see, by the way, the green hooks, that's where we are already. Where you see the [ lila ] parts, we would like to be also and where, let's say, there's not available, we, of course, don't want to go, and there are certain things like in gaming, where we also decided not to go like virtual reality. There's a lot of talking about it but the market is still extremely small. User loyalty is not that big in the market. So at the moment, it's not a segment that we look at, for example. Yes, our M&A pipeline, the top 5 targets, they have changed since our last presentation. Normally, we see a 6 to 9 months period. If in that period, we are not closing a deal, the company has mostly gone or we're not interested anymore and it's off. From our last list of 5 companies, there was a big -- a big -- sorry, game company, online game company on top, a gaming mobile company. We decided not to buy it because their performance was not as we expected at the beginning. The second one, Smaato, we acquired. So that's -- and the other ones were smaller, the ones we're still talking to. But we have a new list here. Our current top targets are a mobile MMO publisher. EUR 90 million to EUR 100 million in revenues, a bit larger than what we normally look at with always the risk and valuations go up, but here, we are not in competition with others. So that would be a very nice addition. Then the demand side platform for the media side with EUR 6 million to EUR 8 million revenues. Supply-side platform, also for the media side, EUR 20 million to EUR 30 million revenues, both the media companies based in Europe, both only covering a limited number of European markets and therefore, extremely well scalable for us with nice technology both. And then to a bit smaller game companies, mobile game companies also, and that's what you see, there's all 3 game companies on this list are mobile game companies. So that's what we are working on. And as always, a word of warning, I mean what's on this list is what we'd like to buy, but there might be things in due diligence that we find out there might also be other people that pay much more for the company in the end. And then we don't do deals. We still want to stick to our very, how to say, conservative multiples where we buy companies. Combining games and media, yes, also already since a while in the presentation, we are extending the value chain. Value chain of gaming is user acquisition playing -- the user playing and then making money with item sale and advertising. And then we have the media for the user acquisition on the one side and also selling the ads, which is only part of the income, of course, of a game because there's also items here on things on the other side. Yes, we were not that happy with the media house that worked for us. And also we know that a lot of other gaming companies are not. That's the reason we decided to do it ourselves. A big advantage is on the cost side. a standalone game company pays more for its ads and gets less for its ads than an integrated company, there's just still got very good margins on the media side. And the other thing is that -- and that's even more important, which is data optimization to make a real good match between an advertiser and a publisher. So the one that has -- that wants to buy ads and the one that offers the ads, you need data to optimize and you need to buy much less ads if you can optimize better. And we're having a lot of data from our gaming side, having a lot of data from our media side. And because of having a full stack on the media side, also having full transparency there, it's much easier to target and much more effective and efficient to target. And then using that to further grow. So both segments, gamigo and Verve, that's those brands that we unify our activities under. On the gamigo side, it's adding critical mass when we do M&A, so buying further game companies, games. Always focusing on sustainable games for PC, console and for mobile as said already. On the media side, we want to further complete our tick-the-box slide. So there were still some things missing. And yes, also adding critical mass, Smaato is adding critical mass, of course, also. And then organic growth, yes, on the gaming side, for the current game portfolio, making sure that we have updates, smaller updates, large updates, DLCs, but also internationalization, player acquisition and new game launches, but not own game development. And then on the Verve side, cross-selling when we buy a new company, their customers take only part of the service that we have available in the group, so we can easily scale that. That's happening by connecting the platforms, product innovation and adding new customers. And the synergies, of course, cheaper media, full transparency, better fill rate, data, unique ad inventory, additional revenues, overhead synergies and know-how sharing. And one of the things that we haven't talked so much about is all the know-how that we built, of course, on the gaming side, we're doing M&A and integrating companies. We could use that, copy paste on the media side. That's also one of the things, of course, that was really practical when we started the media side. Yes, altogether, 36% organic growth in the quarter, 90% total growth, overall growth. I'm always saying a word, warning, the 36% is really great, and we're really happy with it and we're not promising that we will do this every quarter because this is the result of many growth initiatives. So it's not one game that we launched, and that is suddenly driving all the growth. It's joint from the media and from the gaming side, roughly 10% of the growth comes from the gaming side, 26% from the media side. Gaming was extremely strong last year in the second quarter because of COVID. Media was weaker last year in the second quarter because of COVID. So there's also a compensation in there. In the first quarter, we were more equal in the growth -- in the organic growth and also in the third quarter, we expect to be more equal again. Yes, and the market is growing slower than we do, but it's, of course, very nice and we're still very small compared to the total market. ESG, the last part of my presentation and taking -- a lot of things happening on the ESG side. A lot of things have happened -- have been happening in the past already, but we've not always communicated that much about it. But we are going to publish our governance report next week. Latest, the week after. Sustainability reward already has been published. This week, we announced that we are carbon neutral for 2020. And yes, part of it is really focusing on using data centers with low, how to say it, emissions or no emissions or even negative emissions like Google is working on at the moment. But the other thing is, of course, like a bit with the churches, if you have anyway done emissions, you can buy it off or you can pay for it, which we also did in a bit different way. There are a lot of good projects in the world, and we had our employees elect the projects that they wanted to really invest in. And those are projects that are really offsetting carbon and as such, we thought that's a good way of doing this. So happy with that. Then on the sustainability side, GDPR, of course, an extremely important topic for us as a media and gaming company. It's about letting the customer know what is done with this data. It's not about not using data, but it's about using them properly. Then, of course, also evolving our community. So we have in reforestation project, so where people can plant virtual trees in the games and for each virtual tree planted, a real tree is planted. We are doing now -- we're starting now the same thing with water, but Jens can say a bit more about it. There's at least in test running in one of the games. And yes, the other points, code of conduct, of course, gender diversification. So with our new hires, we were getting closer to 50-50. But it is as all the companies are trying to hire more female employees. It is, of course, a fight for the good talent and not always easy to get it. But we are doing pretty well on that, I think. And then on the governance side, yes, we have a lot of things that are there already. Sustainability Committee is there for quite a while already. But also corruption, 0 tolerance is logical. It's normal, I would say. But we have a new whistle blowing software, which has just been implemented for the employees, but also for our customers. Yes, of course, management conversation, independent Board members and a lot more than we can put on this slide. In the games, very important youth and child protection safe environment. So a lot of preventive measures, and I'm not going to read it all. It's all in the Internet available later as a presentation. A lot of controls and sanctions because it's nice to have rules and preventive measures, but there is still, of course, we're working with human beings and there's always a lot of creativity there. So we're really -- yes, there's consequences for bad behavior. So also in our games, we have a kind of our community managers, which are partly event managers, but also partly police and also, of course, seeing that there is positive behavior in the games. And then we have, of course, improvement targets where we are further working on improvement there. Yes, a lot of initiatives we are doing also on the sustainability side. [indiscernible] is a very good initiative where, let's say, x spots that are not sold -- are being used for good causes. In this case, for example, for making sure that people get COVID injections and also against misinformation about it. Also Black Lives Matters was one of the big topics they did. So that's really important. Then yes, Planetly, a company we work with for, let's say, evaluating the carbon footprint of things. So a lot of things going on there. And we have -- yes, our target defined environmental, social and governance. Carbon neutral, as said already, we beat the target a bit, which is really good. And even going into more detail, but not going through this slide now in detail. But there's a lot of initiatives that are going on in the company. The green ones is where we're actively working on the piece of projects that we just started. -- where we're also working on. And it's -- we try to spread it throughout the whole company because it's also an awareness thing to do these things. That was my part. I've not looked at the clock, but I guess I've beaten my 20 minutes a little bit. Jens, please.

Yes. Thanks a lot. Yes. To avoid that, I will turn around the laptop a little bit because there's a clock on it, which tells me what's the time and how much time I have. I will guide you today a little bit through the game segment and show you what happened in the past. I'll give you a little bit of an overview about the game segment and also give you a little bit of an outlook what will happen in the future. I'm going to start with an overview of gamigo. Yes, as Remco already mentioned, has started in 2012. The headquarter is based in Hamburg. We also have a big office in Berlin and also have a big office in Austin, Texas, where we mainly do development for our current games portfolio. This came with the Trion acquisition, and it's still the case that in U.S., you get quite professional game developers and therefore, we decided to keep and build that up in Austin. We have done since 2012 25 M&A transactions or more than 25 actually. There has also been some asset deals in there, where we did not acquire the full company. We started 2012 of 80 employees and only based on Hamburg, yes. Nowadays, it's over 500, round about 500So quite impressive increase over there. We have found about 10-plus top MMOs, 5,000 casual games, so casual games is more smaller games like hidden object games or [indiscernible] 3 games. And we have by now more than 100 million, which is that users. We have revenue split. So we are still quite strong in the European Union. So in EU, also in Germany, especially. But with the KingsIsle acquisition beginning of the year, North America and U.S. became our strongest market with 66% of the revenues. EU still very strong with 28%. Revenues by type, client games are still very strong on our side of 83% of total revenues, followed by mobile 5% and then other games and console games, 15%, Trove is our main game on consoles. Some of the major acquisitions you see on the bottom with Aeria games, WildTangent, Trion, freenet digital, KingsIsle, but also don't need to read all of them. We have -- in games, we have quite some different monetization strategies. One is free-to-play. free-to-play is the most common thing in online. It's -- the game access basically is for free and the game monetizes by selling virtual items, virtual goods and you can purchase them via in-game currency. So you go to the website, you're charging on currency and with in-game currency, then you can buy weapons, boosters, these kind of things. Buy-to-play, which is the more traditional way of monetizing games, so you buy the game, you have access to the game. You can play it until you are done with it and then you switch the game. But also as all the monetization strategies are evolving, it's possible nowadays -- and we also have that in some of our games that you combine free-to-play and buy-to-play. We call it a hybrid model. This means you buy the access to the game. But then within the game, you still can buy in-game items and other stuff. With an hybrid model, it's important to say that we usually you. We don't sell them some stuff, which makes people stronger. It's then more that people are -- can individualize theirselves. So other costumes, other haircuts, these kind of things. Then also getting more and more important these days is advertisement-based, especially in mobile, but also in the casual PC. So Yes, I think it says you show advertisement in the games. So the game basically is for free and the game monetizes just by showing ads. Subscription-based also a very interesting way of monetizing a game because we have very high lifetime revenue also and you have very recurring revenues, where you can really plan very good because you know how many subscribers you have. It's basically monthly subscription. I think World of Warcraft was the first one who did it at -- yes, really excellent. But there are also now new methods how to do it, giving subscriptions only for specific parts of the game or for specific boosters so that you get the beginning of the month always a package delivered. Yes. gamigo is -- where we are attractively positioned in the games industry. I think we are different from just being a publisher or just being a developer, which you can see on the slide of the portfolio diversification is to mention, we have a very wide portfolio from casual to MMO, to RPGs, to browse our client consoles. I think that's very unique in the market. Technology edge, we have a technology platform, which allows users to download the games where we connect all our platforms together, so that it's also much, much easier for users to jump from one game to the other. If they are bought in one game, they can try out another one. We are an M&A company, also parts of, so we also have an M&A platform. We are very good and very fast in integrating companies if we have acquired one. I think that's also where we -- not where we -- not super unique, but it's -- we are very good in it. And worth to mention is user acquisition. Now with the Media segment, we have in place, that's something which is really leveraging the games because we have access to our own user acquisition in-house. And I think some Sameer and Ionut will give a presentation later on, and I also will mention that a little bit later in my slides. We have an extensive quite a lot of game. As I said already, we have a very diverse portfolio. 80% of our total game revenues are coming from our own IPs. That is what Remco mentioned a little earlier that if we have launched the game successfully, we also try to get the development in-house. And now also with our Austin-based developments, so we feel very, very confident to further prolong the strategy. And as you can see on the left, 8 of our 10 top games are currently maintained in-house. And our Kingdom and Grand Fantasia, which are -- the Taiwanese developed by X-Legend is a licensing approach. 5,000 casual games. Casual is a total different approach. We upload per week 2 to 3 casual games in our platform. Casual game usually is a [indiscernible] hidden object games, very small games, with a subscription model or with buy-to-play model, you buy the game, you play it, the game takes around about 6 to 12 hours to play through. And then you play 1 or 2 per week. That's why we are uploading 2 to 3 per week. Also important to say here, the IP was on our side. So that's work for hire. The development studios deliver the games. We buy the games from them, we upload them to the portal. To show how MMO basically works, I'll give you an example of Wizard101 called by the press, not by ourselves. By the press, the Harry Potter of online games. I think the name fits very well. It's an MMO RPG and we have world of wizards. You play your wizard, you train your wizards. You have an open book. It's very family friendly. Also the graphic style, anime style, very timeless style. Community, you collaborate with the other wizards to get stronger and build lasting relationships. Some of our people -- players play the game over a decade, so quite over 10 years and still stick with the game. This also shows how stickiness these kind of games are. And we hope and we do everything that they play another decade. Thousands of hours of diverse and engaging game content, that's also key to success for bigger MMOs. You need to have that. And as you can see in the recurring revenues, 55% of the revenues of that game are coming from players who were with us since more than 5 years already. I don't know the exact number of people who were with us longer than 8 or 10 years, but it's also quite impressive. 50% of new players are converting to paying users. That's what you also see here. Only 1 year in the game, 21% of the revenues are generated by these users. This is also an effect of having worth on board, who is enabling a much more effective user acquisition. That's the challenge nowadays to get effective user acquisition in your games. And I think with these numbers, we can prove that we are able to do so. Substantial revenues. The game has generated already USD 430 million since it's launched and 55 million user accounts created since it's launched. But not only Wizard101 shows these numbers, although you see here, verity of our games, desert operations, 85% revenue comes from players older than 5 years in the game. Pirate101, 53%; Fiesta is 62%; But what you also see parts of our initiative the last 12 months, last 6 to 9 months, was to concentrate on getting new players in the game in combination with Verve. And that's what you see here, too. Last Chaos, 22%; Fiesta Online, 80%; Pirate, 24%; Wizard, 21%. Next, I want to show you some initiatives about organic growth and what we have done in the past and how we reached organic growth. So first, we need to talk about our portfolio approach. Part of our growth strategy is that we have a very diversified portfolio approach, too. So we are acquiring game IPs where we know the games are successful. Said it again, 80% to 81% are coming from these kind of games. We still are licensing games. That's also part of our core business. 19% are coming from it. And as you [indiscernible] as you can see on the bottom, our licensing department is very, very busy with screening these games. We get per year, 2,000 -- more than 2,000 games on the table to evaluate. 1,000 of these games are proceeding the first check. So the first check is really, you start the game, you have a first look and then already half of the games are out. So even there are sometimes 50 to 100 games, we get on the table, they even don't start, which is sometimes a little bit crazy. Then 53 business cases we create. So if a game is really, really of our interest, we start to create a business case. And we start to do focus groups with bigger groups and also with some external to get a better feeling, if not only our internal people like the games or also external people like it. And then we have signed -- out of these more than 2,000 games, we have signed 4 contracts. So -- and I remember the year before, we had similar numbers. And we signed 1 contract. So it's really -- there are so many games available in the market, but only a little piece of these games are really worth to publish. Then when we have decided to launch a game or that we acquire IP, then that's where worth again comes into the game. What to say about that? Yes, 50% cost saving for user acquisition because we use our internal user segment, I think that's a very impressive number. And we can increase our return of invest by doing this internal user acquisition. Some growth highlights. We are not only licensing and launching games. We are only working on our current game portfolio. So second half of 2020 and first half of 2021, I also don't go through all of them. I just highlight a few. One really, really big update was the Trove launch. We launched Delves on Trove, which was a huge expansion, also of our internal team in Austin. gamigo celebrated the 20th anniversary, which was we celebrated 1 month. So beginning until the end of different events, not only sales events, also a lot of events in-game. We even developed events for that. Also the Trove update was a big one, which was very requested by the players. So the team put a lot of effort in it to build that online. And also Fiesta Online celebrated its 14th birthday. So also quite long in the market, but also anime style, very timeless, very loyal community. It was a big party, I can tell you. In the first half 2021, major spring upgrade for Wizard101, where we are really proud of because that Wizard101 comes from KingsIsle, which we just recently acquired in January. So it's also important for us to see that we further can develop bigger content updates for that game. It went live. It was a huge success. Players were very happy about it, really good. Then a big one for us was Trove coming to Nintendo Switch. Also what Remco mentioned, we have a platform strategy that we know our proven games do all the work on different platforms. That's why we worked with an external studio to develop Trove for Nintendo Switch. We have launched 6 or 8 weeks ago. Servers are full. Players are happy, so really success, and we are now evaluating what kind of our -- which games from our games portfolio would be next for Switch. But maybe also other platforms like next-gen platforms from Sony and Microsoft. Cosplay event. We only do some -- we also do some cool stuff with the players in their, let's say, real life. So we hosted a Cosplay contest. We ask them to dress as characters from our games. I think everyone has seen Cosplay already. Then we ask them to send in pictures or videos, how they created the costumes and when they wear it, and then we -- yes, we gave a award out of it. It was also quite nice. I need to check the time a little. Outlook 2021. Strongest organic growth pipeline in history. We're going to launch a mobile game called Tales of Twilight It's announced already free-to-play, mobile, android endpoint iOS. Also referring to Remco said, we are concentrating more on mobile this year and also next year for sure. We have the worldwide license, that's important to say. And that's also a big step for us when it comes to internationalization and geographic extension. We have a Golf Champion swing of Chloe. It's a working title. The game is almost finished. It was built by a AAA studio called Behavior and Active. We took over the game and we're going to launch by the end of the year, the fourth quarter is now the target where we want to launch. It's also available on switch. I talked about that. Skydome, it's an MMO 4 versus 4 so-called tower defense battle arena game. It's launched since yesterday. So let's cross fingers that the game will be successful. One further MMO game, we just signed 2 weeks ago. It's an innovative open world sandbox MMO RPG. Yes, it has already a constantly growing community. I cannot announce the name yet because we have not announced it officially, but the game was already in an early access. It has shown really great results. After that we signed, it's a young, very motivated team. We are really, really happy to have that signed. One further mobile game signed. Also not announced yet, so I also cannot tell the name here, but it's a cashew [indiscernible] management simulation mobile game with a strong social network approach, in-app products and in-game advertisement and has already been successfully launched in Asia. We believe the graphic style and also the kind -- they monetize the game also fits very well for European and North American market. So we are also very happy to launch the first quarter of next year. We have more than 10 other projects in the pipeline. It's sequels of our games. It's new platform launches of existing games. Yes, with total development cost of more than EUR 10 million. We have in-licensing deals. So we have really a huge presentation with many, many games, which we could in-license if possible. We are working on out-licensing deals. This means that we will further bring our games towards Asia and other territories where they are not live yet. Russia, for example, and other numerous -- other organic growth initiatives. Synergies of media segment, as I -- here is a good example how we do that. So on the left, you see the advertisers. Advertisers want to advertise their products. On the right, you see WildTangent, which is our [indiscernible] unit. What usually happens is that you have feed DSP data, supply side platform. You have 2 or 3 external companies who deliver. They all take their margins. With an external company, the relationship is not always as good as with an internal. And what happens here is that we own the full funnel, so the advertisers, as I want to show, advertisement in your games. And we deliver the full funnel until the publisher consumers. Next one is reaching new audience across the open web. Here is important. We have been trying to acquire new users outside the walled gardens. We -- it was very challenging with worth on the table. This is also much, much more easier. Some impressive numbers, 10% to 15% conversion rate, which is very unusual for that 200,000 users reached already, and we have 100% to 200% return on advertisement spend. So really impressive and really happy to have the media segment. M&A, I need to rush a little bit, I believe. M&A, leading North American. KingsIsle at the glance, yes, we were very happy to acquire KingsIsle. It also did -- that's the more important slide about KingsIsle. We also did well above plan. We are trading 35 million -- plus USD 35 million revenues for 2021. That's the estimate numbers. Here in-game revenues, are $61 million That's the free-to-play monetization. Subscription revenues, 33%. And other, which is advertisement basically and some other minor stuff is 7%. Adjusted EBITDA of more than EUR 21 million. We will do this year, that's for sure, games is very stable. So we expect also very successful next year and the years after. EBITDA margin, 66%. And yes, purchase by us, EUR 126 million. Also KingsIsle has included one game called Pirate101. This is also showing organic growth, very nice, not only Wizard101. So we acquired the company in January. Since then, we were growing the game quite well, 27% year-on-year. We have now put more resources on the game. Also will internationalize the game. Currently, it's only live in the U.S. We will move the game also to launch the game also in Europe and other territories. We have developed the first content update after, I believe, 5 years. So you see there's a peak now. And yes, game -- that's quite good, and hopefully, we'll do quite good in the future. With KingsIsle, we have nice growth opportunities. We will expand the games in new territories, extend language versions. We are looking into the possibility to go to mobile with the game, which is quite a nice opportunity. We will -- we are looking in the opportunity to probe to console, most likely first switch and then Sony and Microsoft after that. And with, again, MGI's media expertise, we can leverage the users in the game. KingsIsle also was super fitting in our strategy. It's a core game. It's free-to-play, advertisement-based, subscription-based, own IP. So it was really adding a lot of our tick -- already ticked boxes, but just was adding a lot to that. This has been my last slide. I was in time, more or less.

Speed it up.

Speed it up at the end.

Thanks for that. So Remco, would you like to join on stage. And I mean you have had time to think about questions, right? So raise your hand, and you will be supported with the microphone here in the room. And I think I will show the first questions just to get you going guys, right?

So there are so many game segments. So why are you so focused on MMOs?

Good question. MMOs have a very loyal customer base and then also a very, very high lifetime of customers and players. That's what you have seen in the presentation. So revenues coming from customers longer in the game since 5 years, that's why we concentrate on MMOs. It's also online. So you have this community building. Community building is always leading to very high stickiness in the game. That's the -- That's the reason why we concentrate on MNOs.

Okay. And another thing, I'm curious to hear more about this really. In comparison to some of your competitors, you are integrating your acquisitions right? So I would actually like to hear a little bit more about that from the inside. So I mean, how do you actually do it? And also right now, I mean, what are the short-term prioritizations within the organization?

Yes. That's would -- maybe be for the whole day, if I now would -- if I talk about how we integrate them fully. But basically, we have a very strong M&A knowledge, and we have a very strong management on the first and second level management team. So what we do, we have a technical integration, which means we are connecting the platforms. We are moving everything into our infrastructure, which makes it much more efficient to manage. And the other thing, we also integrated teams into our infrastructure. This means we don't have like other companies, 5 different marketing companies or 5 different customer support companies. We have centralized companies. We integrate everything in there. This also gives you the flexibility. If you have a peak in one game, you can easily move the sources there. And if you have a peak in another game, you can easily move the resources there. And usually it takes us just a couple of weeks, 1 to 2 months, to integrate the company fully into our organization.

Yes. And what's also important is now home sharing. So role play games with different genres go in the same team, strategy and build teams go in the same team. So you have a lot of know-how in how we optimize the games. You can get things from one game, let's say, port it to the other game. So that's also, I think, a very important aspect.

Okay. So you managed to deliver organic growth here and also curious to better understand what are really the key 3 drivers behind this quarter organic growth?

Yes, the 3 main drivers. One of it is what I mentioned, the development approach. So that we really maintain our games with new content updates with our Austin studio where we had put a lot of effort in the last 12 years to build that really. And I'm really, really very happy with the studio. Second approach is that we get the user acquisition via worth. So we are able to get on a very nice, our IT users and our games. And I would say the third one is that we also have spent a lot of effort in the past 12 months on in-game ads. This was a field where we were lagging a little bit in the past years, but we have spent a lot of time, a lot of resource and that was also a field where we have seen a lot of organic growth.

Yes. And I think if I may add to that, that's number for themit's [indiscernible]. It's also spreading the number of initiatives, organic growth to just bet on one horse in gaming doesn't work. So what we've been able to do since we are talking about organic growth is really for each game have multiple initiatives, but also multiple new games to going to be launched. So we're talking about, let's say, 2030 and the number is increasing initiatives. And also to say a word of warning here, not all of them are successful. I mean, we're talking really about the portfolio approach. And just to give a negative example. When we launched Trove in Korea, we were really extremely bullish, optimistic, but it didn't work that well. I mean there's hardly any revenues coming from it. On the other hand, and it's still a bit young, but Trove on Switch. We had also very good expectation. Otherwise, we wouldn't do it in organic growth but, of course, if you wouldn't expect, but that is working extremely well. And that's only, let's say, 2 weeks into the last -- into the second quarter. So we will see more of that in Q3. But gaming is really -- if you want to do organic growth in gaming, it's about a portfolio approach. You need to have many projects, many different angles to grow your games. And the more you have -- you will always have a certain percentage that fills. And that's part of the game.

Yes. Over here.

Jamie here from Carnegie. First of all, it's been really informative so far. Jens, you quickly touched on the ESG side of things. And I'm wondering just how -- high level overview, how you are able to ensure that the younger users are not seeing inappropriate advertisements or ensuring that they're not playing the maybe more violent games?

[indiscernible]?

So first of all, we have a well-trained team of community managers, which is controlling -- already have age ratings for the game for the majority of our games, so we can make sure that also parents can control, if they play these kind of games or not. We also have specific mechanics in place where we can filter out if people play inappropriate games or not. And we also have tools in place, which make sure that we don't get any inappropriate traffic into the games or advertisement shown into the games. So we have really specific -- it's a wide range of initiatives and also a wide range of tools and technical solutions. And then also the human component with our trained community managers who take care of that.

Here, we have another one.

Marlon Varnik, Pareto here. So you mentioned or Remco mentioned that you're still too small to create own games from scratch. So it sounds it's on the agenda. So what's needed here to get there? And when can we expect you to build from scratch?

It's a matter of, let's say, looking at the total size compared to the company size. Just to make a very simple calculation, we talk about massive multiplayer games. I mean not talk about small games, but a massive multiplayer game to develop it, EUR 5 million at least, rather EUR 10 million or more. If you really want to have a certain likelihood of success, you should launch at least 10 games a year, which means you need to develop -- let's say, you need to put 10 x 10, it's EUR 100 million in development. And as it take 3 years to develop an MMO, a rough number, you need basically do that times 3. So we talk about the EUR 300 million invest if you really want to go into game development, and it's rather more on the low side than on the high side, I would say, to do this seriously. And looking at, let's say, our EBITDA and our size of the company, at the moment, I think that taking a EUR 300 million invest risk in doing that is still a bit on the high side, but it might change. I mean if you continue to grow like this, it would make sense probably to start this in 2 to 5 years to give a bit of a horizon there. But only to have the money to develop 2 or 3 games or to have one studio that's doing it, that's like going into the casino or like playing lottery, and that's what we don't want.

Just worth here. We have seen in several M&A cases we did in the past, exactly that approach that companies use their money to develop the next World of Warcraft or the next Clash of Clans or you call it. And then in the end, it didn't work out. And then they say, okay, now we do it and it didn't work out and it didn't work out. And I think the risk is just too high at the current stage for the given reasons Remco mentioned.

But as said, you need a portfolio approach in gaming and especially in game development. And now we have a nicer world because there's a lot of independent studios, a lot of game developers in Asia that publish themselves in Asia, but then look for somebody to publish the game in Europe or in North America. So they take the development risk, they take the EUR 10 million or EUR 20 million or even more. And let's say, we give them a certain guarantee of marketing if certain KPIs are met. But that's, of course, a lot lower risk for us than if we would do the full game development because it's the risk of game development and then of course the launch risk also because you have to spent a certain marketing budget and all other things. So that's the reason that at the moment, we just say we don't do game development from scratch. We let other studios do that. But then when the game is successful, we try to buy the IP. And then we're also willing to pay a bit more, but then it's much less risk.

Okay. We have a online question coming in. Can you discuss gross marketing of players' games and moving players from perhaps declining games to new games or new cash and mobile gains? And the question coming in is from Ken Rumph, MSM.

Yes, we call it customer retention. That's exactly what we do. So we -- if -- we do cross-marketing on games. But on the other side, it also makes no sense if you have an active player in the game that you cross-market him to another game because then he may stop the one game and he doesn't like the other game and then you lost him basically. But what we see if player gets getting inactive or playing less and less, then we try, first of all, to retain the player in the game. If we recognize this is not possible, then we try to convert him into another game. It's not always possible, but we although see good results in that.

Okay. Good. I think, yes, time to wrap up, right? Time for coffee or have one more...

We've got one question.

There's one more question.

Yes. One more question. Yes, let's go.

This is [ Oscar ] from [ UniCredit ]. Just -- congratulations on a fantastic quarter, and thank you for having us here. My question is about the mobile games valuations, where you clearly do not believe that the blip in the market from the data protection event is something that worries you because you are looking at acquiring it. I just -- without spilling any trade secrets, why you think the market is wrong? If you could elaborate on why you are looking at it. Is it just for diversification? Or is the market wrong in calling the multiple slower?

Yes. Shall I? First of all, why are we looking into mobile? It is because we believe that if you have a good IP, it makes sense to publish it in as many platforms as possible. Same as with the movie goes, video-on-demand, TV wherever and also where the game, it makes sense. But the game, it's a bit more complicated because there's much more technology involved. You cannot just put a game on another platform. So that's the reason that we really like mobile. And looking at the total overall market, mobile is roughly half or even a bit more than half of the total $170 billion that is spent on games worldwide. As with M&A, you can build critical mass. It's much easier to first do some M&A cases in a certain -- than to go fully greenfield in there. We here do a combination. So we have new mobile games that we launch. We have already some that run. But on top of it, we like to do acquisitions. In the past, we were talking about really extremely high prices for mobile games. And always the story like, "Yes, we have a new mobile game, and that's going to change everything." So one point is that there has become some, I would say, normalization in the market that people see that mobile games also came with a high-risk factor basically for the mobile game company. So that already helped bring the prices down a bit. And secondly, IDFA and also other cookies going out of the market is a point that is driving also -- is putting more risk on the mobile game company. And IDFA will impact mobile games or is already impacting, look at Facebook revenues, look at, let's say, also some game companies revenues. On the other hand, with our media part, we have so many good tools that we are not afraid of, let's say, not working with IDFA. And therefore, we see that the cost of acquisitions or the multiples for companies go down. While on the other hand, we don't estimate a risk for us as high as for a stand-alone mobile game company. So that's the background.

Okay. [ With that, we wrap ], right? So thanks a lot. So one kind of question to you, Jens. What's your favorite game?

First of all, all of our games are great games.

[Foreign Language]

That's what I can say. The personal one game, maybe not of our portfolio, I think almost everyone who's a guy played it, it's FIFA. But one game of our portfolio, which I've played quite a lot is Fiesta Online and just check it out, it's really nice.

Okay. So let's grab a cup of coffee, and we will actually kick off within a minute with the media deep dive. So yes.

See you later.

See you soon. [Break]

All right. Okay. I thought the media session is after lunch, the energy levels are going to go down, but I'll get started, guys. Let me give a glance of the Verve Group, that's a media section within MGI, as we are connecting the advertisers and publishers to people in real time. The group was started in 2016. We are headquarters based out of Berlin. We have done 10-plus acquisitions in the history so far, almost 400 employees now with Smaato as a recent addition. And we've talked about 166 billion ads that we've delivered in the last 12 months, which is going on and on. And 5,000-plus advertisers in the system. Every day, the advertiser base is actually increasing. We are a complete platform by definition, which is a full stack and self-service offerings. And the marketplace is active in 20 countries. With Smaato now, the reach is going to go further up. Again, key revenue splits. 166 billion ads delivered. One of the most important part that we're proud of is we have a 95% retention rate of customers who are more than $100,000 as a SaaS accounts. This is a great asset that we have. 21% increase in SaaS accounts in Q2 of 2021. And some of the major acquisitions, the biggest one, recent one is Smaato. We bought LKQD. Beemray is a DMP that we recently acquired based out of Finland, AppMonet, of course, PubNative and Platform 161. Full stack transparent advertising technology infrastructure. This is what -- this is who we are and in some of the media segments highlights with the ad tech value chain, which was recently covered, on the system, where the advertisers who are willing to participate and work with us, they get a full demand side platform and data is so important for optimizations for the KPIs and the goals that we define. And they are very different for brand advertisers versus performance versus different kind of ROIs. And then the SSP feature, which eventually plays a big role. Eventually, we are reaching the end consumer, which is coming through a publisher. So all the blue-chip customer base that you can see, a huge base of advertisers. And on the most premium working well publishers, that's the full stack transparent offerings that the platform is providing. Monetization strategy. Now again, one key factor is our monetization strategies are divided in 2 segments. One is SaaS-based revenue and the other one is non-SaaS revenues. Subscription-based platform fee is 10% of our current outstandings. And then we have revenue share platform has 75% of contributors. And the remaining 15% is basically guaranteed or flat CPM as we have -- we often cross -- hit across these customers when they're coming from CTV or OTT stack. The value chain, as we covered in past as well, right, the -- if -- and this is just an example, an anecdote here about we are -- with the DSP, the DMP and the SSP now a part of the Verve Group, and within the gamigo group as an example, if we were spending $3 -- EUR 3, half of it -- 50% of it is actually gone to other platforms in the mix. But now this is all in-house that we have. Verve Group at a glance. I think the biggest asset guys that we have is our people. And we -- it's a very experienced leadership as we are acquiring more and more companies. We are always looking to strengthen the management and executive level. But it's a very experienced global executive team. The number of engineers are 150, Ionut wants 200 more. And proudly -- we are proud members of IAB, MMA, Prebid organizations. The industrial excellence comes as we have all -- almost the top Fortune 500 advertisers working with us. We have -- there are just a few ones which are left, but we have the top-most performance -- direct performance demand, which is also a part of us. A lot is done in the proprietary algorithms and optimization, means in 5,000-plus direct publishers. And sky's the limit here. Now some major integrations with big platforms is going on. So this number is going to go further up. And we are proud to own and operate a lot of gaming supply, which is improving in our end-to-end stack. Who we are is a global omnichannel ad platform. So the complete stack definition is right there. Managed service ad platform. Mobile RTB ad exchanges, SSPs, et cetera. And open-source SDK, we are the second company officially to talk more about it, but we have an open-source SDK, which -- through which we earn a lot of trust out there from the developers and the competition. And in-app, mobile web, desktop, CTV, OTT is an extension that we're always working on. This is a very important slide where it describes MGI in the completeness. Remco did cover about the vertical completion, so -- which puts us in a comparison of some great companies out there competing against us in some of the other form. But when you talk about transparency and open standards, open-source projects, DSP, now we have a DMP, and of course, with Smaato, our SSP capabilities have further gone up. We have a full stack offering. We are 100% into mobile. Web is expanding, CTV, OTT. And owned and operated through our gaming portfolio. So you can see a lot of checks which MGI as a group has, and this gives a clear glimpse of where the competition is where we stand in. I was right on time. I'll give back.

So I'll give a quick glimpse of what's under the hood on the media side. How do we actually cover this value chain and what end-to-end actually means for a full stack platform. So we start from the advertiser side. And we have a few ways to let advertisers into our platform. The first one is managed. That's how we call it, means direct campaigns. They basically sign an IO and then we deliver the creative. Let's say, gaming creative, and then we deliver it in WildTangent games, right? That was the example from here. So that's one way. The other way is they already own a DSP. Either they own it in-house or they use a DSP, like The Trade Desk, right? In that case, they plan into our exchange or exchanges because we have a few. And then they can execute and deliver the campaigns on our own inventory or compete with the other advertisers. And the last way, but not least, is actually the exchange ways. Meaning that not only do we let advertisers directly all through their DSPs, but if they have an SSP of choice, let's say, Magnite or PubMatic, we let them compete. Those are marketplaces, right? PubMatic is a marketplace, Magnite is a marketplace. We let those marketplaces compete with ours in real-time to maximize the yield of the publisher, but at the same time, extend the reach for the advertisers, making sure that they can access our supply as well. So that's the demand side, right? Then we move into our bread and butter, what I would call, basically our technology platform. Has a few layers. I won't insist in all of the layers, but happy to answer afterwards. I'd say one of the more important ones is the controls there, basically, where we push the buttons. We, by we, I mean, the 200 people, 300 now people strong, that we have selecting demand, selecting supply, checking for ad quality, for example, if the ads are inappropriate and things like this, looking for flags, CCPA, GDPR and things like this, and then optimizing basically the ad delivery and the flow throughout the marketplace. But of course, controllers are not enough, right? So we're talking about automation, and we're talking machine learning to automate all of that decision-making in real-time, 2 million times per second at scale, right? At the scale of the open web. So that's the automation there. So we have algorithms at almost every layer that you see on the demand side, on the supply side, optimizing, which eventually is valuable, at which price, to whom to sell it and things along those lines. And we're constantly iterating on that part. Now last but not least, we are integrating with publishers. And Sameer already mentioned the open source SDK, which we're very proud of, but we also work with any other means of integrations, right? The way we reached 5,000 publishers and actually many more is that we integrate with other platforms, such as Amazon, such as Google and a few others are coming soon through APIs or JavaScript tags in order to be wherever the publisher is. So whatever software stack they have and ad serving stack, we're going to be there to serve their needs. So WildTangent, just an example, on the web or they will be on mobile, on MoPub/Twitter, we will be able to service them, right? Because that's basically our job: finding the right users for the right ads. And talking about the users and ads, our flywheel. It's actually rather simple, right? It's a marketplace play. We add more publishers, which add real estate, right? They have banners or videos that then we can sell to advertisers. The moment we optimize that through data, of course, and advertiser manage to buy the right users that they want, and we bring more and more advertisers, then we have more budgets to expand into new publishers. And we've been doing this for years and now you see the growth. The flywheel just gets bigger and bigger, right, almost like a snowball effect. And now we're able to organically add publishers like Zynga, like Activision and a few larger ones, right? While at the same time, adding more and more advertisers to the marketplace. Of course, this doesn't happen all organically. We're also doing it inorganically. For example, we got Trade Desk. I think we had LKQD connection, which is a DSP on the other side, right? So we -- I would say we doubled the acceleration pedal with these 2 types, organic sales and inorganic, connecting the dots, so to speak. So that's one part. Then the other part is, of course, levering synergies. I think we talked about integration in gaming. In media, it's a bit different. We actually can integrate commercially almost immediately. Sometimes even before we acquire the companies and generate revenues by, again, connecting the dots and filling in the gaps each of the companies we acquire have. So that's very, very important in how this flywheel actually moves. And that's not least, we have the other part, which are innovations as we get, let's say, closer and closer to our partners, either on the advertisers side or the demand side. We understand better their needs. And as we understand their needs, we can develop products to fit within those needs or fill in those gaps. And that's another part of the story on the organic growth. One of those products is called the hybrid cloud. What does it do? It basically takes most of the software that we've built and we give it to the publishers. This is a publisher product, so it fits at the bottom of the flywheel and let them manage their own demand and their own advertising stack, including with full transparency, open-source SDK, for operating tools, reporting, audience creation and activation. So a full stack that we can give, for example, our competitors in the gaming space if we saw these, which we actually do, by the way. So that's just one way in how we innovate. That's on the supply side. And there's more coming there, but that's early stages. And this product is already live, generating revenues but we haven't publicly launched it as of yet. Now before I move to the advertisers side, and maybe a way to connect the dots, iOS 14, there were some questions around. And it did have an impact, right, on the media side, and we've seen that impact. But to our surprise, and this is data from our marketplaces, I think, in the last couple of months, we've actually seen constant. Of course, it went down, right? It was 60%, 70% before, and now it's around 30%, 40%. But I would say that's a win because it means the users or half of them, or close to half of them, understand the value exchange between getting free products and getting advertising, right? And our job is to make that advertising as personalized -- as relevant as possible and not creepy and any other way, right? So it seems to be working and in fact, to be lower than initially anticipated. Still, there is an impact. It's around 35% between the CPMs on pre-iOS 14.5, which was more or less the limitator of post and pre IDFA and the versions before. But there's a key to this number, right? Because a lot of the advertisers started buying much more on the pre-iOS 14.5 versions, right? Because they haven't identified and know the user and they know how to optimize. But at the same time, on the previous versions, they started understanding how they can optimize. There are certain, let's say, technologies and frameworks that Apple put -- made available. So the optimization is slowly starting. The gap remains because there's still quite an increase in the previous versions, right? But we estimate we're going to be back at around 70%, 80% efficiency in a couple of quarters versus what it was before as the whole ecosystem adapts to what we call the privacy-first era in advertising or almost in a digital industry, if I may add. All right. Now what are we doing about it? And this, I think we presented before. And we've been working on this for a year, actually, at least a year. And actually, we had a hack it on running audiences own device 2 years ago. So what's super interesting here and fits with our [ ATOM ] story is that we combined our SDK development know-how. So we have one of the best mobile developers that I've seen or worked with, and I've built a few SDKs in my career. And some of the best data scientists building audiences in the cloud behavior audiences. It's not that unsimilar to what Facebook and Google are doing. And putting those 2 together in a room, virtual room, because it was COVID times, and working mostly nights because some people were in Europe, so people were in the U.S. over -- yes, a couple of months, I would say, 9 months, and we're still working and iterating on it. So there's a lot of blood, sweat and tears to make this work. Actually, our first version was launched internally in September when Apple was supposed to come down IDFA. So we were ready arguably, but at least we had a product then, an MVP. And now we're already iterating on the second version and hopefully, we'll share the results soon. They look quite promising. But let's see as it scales how good they really are. So that's how we try to bridge the gap for our advertisers, right? Because they want to continue finding the right audiences for their games or other products, and we need to deliver a way for them to continue to do that in the lack of an identifier. And what's super important here is that we don't store any PII. There's no PII on this device. We use device information, the app information and maybe the advertising that's being shown. And then we generate a segment, basically, a random number, you could say that would say if it's a male or a female or whatever interest you find. And we aggregate that as well, so you can never identify back a user. But at the same time, make sure that we know, hey, it's a 35-year-old auto intender, right? Things along those lines. Still driving the goals, but I would say, maximizing privacy and doing everything on device, if I didn't mention that. All right. Now one of my favorite slides, something that we're doing with our gaming unit. So traditionally, running ads on TV, it's a bit hard. You need to pay upfront. You will not know what's being served when and where. You need to measure it after the fact. It's a bit of interest-bearing in a black box. Also very similar to how you would do it on YouTube or with influencers, right? So it's a bit of a manual process, not as optimized as it could be, right? But programmatic is coming to connected TV, and we've seen it. While in Trade Desk, investor report, and we've seen that on other platform. So what we're doing now, and I think Jens mentioned slightly, we're actually re-activating users before we send them to our other games. We are re-activating users on our connected TV platform, which is a supply side platform. So we actually own -- let's say, have access to 25% to 40% of the connected TV houses in the U.S. which is a huge number. And we are able to figure out, hey, where our users are on that connected TV, show them a video, I would say drove, for example, and bring them back to the game. That's rather unique. The case study is coming, hopefully, in a couple of months, as it took quite a bit of work to put these things together. But I would say it's rather unique and rather high impact. Also goes to show the other part that most of the media spend from our gaming side flows through our pipes, the Verve Group part. And we ideally want to continue that and actually expand that, both from the retargeting part, UA part was already mentioned, and then, of course, monetization, which was also mentioned. So with that being said, I think I will hand it over to Sameer once again.

Thank you. All right, guys, I'm back. So very quickly talking about why Smaato was a very -- was a perfect strategic fit into the MGI M&A strategy. The investment rationale is very clear to us that it will help us in increasing our EBITDA. Of course, we get a ton of long-term client relationships within the family to represent. It brings a critical mass to existing MGI segments via additional demand and supply globally. And of course, there were substantial revenue synergies for the MGI games and the portfolios and the set of publisher base or the advertiser base that Smaato actually brings in. And there is a very strong SaaS IP. Smaato as a platform, it's a very heavy SSP-focused supply base solution, and it comes with a strong -- this SaaS IP solutions, which we will be now further navigating into the market. There are -- I won't to get the names. There are some top-notch publishers and verticals that we actually get them along with it in all gaming and news and media and utility and entertainment segments. The Smaato financials at a glance, again, it added a EUR 39 million as revenues. There is a strong EBITDA that is listed out there. It comes with 20% organic growth at an enterprise value of EUR 140 million, and the current 10.7x. And we are -- I mean it's -- going forward, it's going to be further beneficial to us at 6.8x. There are many other internal optimization that we are doing in order for us to actually get to that number. One simple example is when we talk about synergies is, we are immediately working on reducing like $200,000 to $250,000. We are cutting the cost on AWS usage. So there are tons of other tracks, which are already identified. It's just been like 3 weeks or 4 weeks of integration process that we have started. Revenue distribution. As Remco mentioned, we are now further strong. We jointly are seen as a very reputed, respectable marketplace that brings -- makes existing Verve Group with Smaato. Now there are 5 very important dimensions, which are future growth levers that brings -- that comes to us. See, we offer a platform and the platform is -- it has -- I mean the complete food chain is or the value chain is serving the publishers, advertisers across various segments. So publishers are getting more and more controls. And I'll tell you, in my 20 years of ad tech experience, publishers always wants to make more, right? They want to make sure the users are happy. There are platforms which has limitations which cannot get all the tools necessary for publishers to really optimize. So this brings -- this helps us to put us into the position and that competition. Advertisers, we extend the global reach of advertisers, preferred buying relationships. PMPs is something that we are really proud of. It's private marketplace. We have grown the business from 0 to like $25,000 a day, and sky is the limit now with the SSP tools that we actually get from Smaato. Video and CTT is integral to our growth. Smaato comes with CTV, OTT stack. And in the coming few months, we'll be sharing more public information. There are some exclusives also that we really, really are amazed of what has been built. Product, technology and scale. See, again, Smaato has been one group, which has been out there for 15 years or 15 years plus. It brings a lot of product and technology and scale value addition to our family. Efficiencies are again extremely important, not just the operating expenses, but one thing which we are proud as a group is we -- on the synergies. And we do -- as Ionut mentioned, we do integrations even before we actually acquire a company. So these are the 5 important dimensions that brings up. User base is so important. And this is -- the global reach of the MGI group was 1.4 billion. Smaato was 1.3 billion. I wish combined was 2.7 billion. But still -- this still gets us anywhere in the range of 1.8 million to 2 billion users. Global reach increases for us and it benefits our gaming business and it puts us, as a group, in a very substantial position of actually doing a global business. I will quickly wrap this one. The sales pipeline is extremely good. It's extremely strong. We -- it just gives a glimpse of who are we negotiating with, what are qualifying, what are the prospective clients. The qualification process is very well vet, and we have standards and processes around it. But you can see some top names, some very fancy logos, which we will be serving or which we are already serving. So we are proud of actually being able to -- just about to be closed. But yes, Smaato brings a lot of value add to our portfolio of companies. You would have seen this tick multiple boxes slide from Jens and Remco. This is so important for us, guys. Again, in terms of the vertical integration completeness, you can see where Smaato is a -- all right, technical glitch. You can see where Smaato is a check. But that doesn't necessarily mean that we did not had it. Some of the checks are actually real complements and it doubles down of the open-exchange network or the SSP capabilities that we've had. But this -- we wish that we are actually close towards where we have a lot of checks or almost everywhere. But Smaato really helps in a lot more ticks in the multiple boxes that we aspire to have. That was about it.

So time for some Q&As, right? Yes. Great. Come on up. So yes, here we go.

So I had a quick question about the publishers. Correct me if I'm wrong. You mentioned that you use other publishers as well as gamigo for the advertisers. What's the percentage of advertisers that you use gamigo versus the other publishing agencies? And also what is the kind of future strategy for -- is it to shift more towards increasing for gamigo? Or is it trying to maintain current figures? Or what's the strategy?