Safe-T Group Ltd's (SFET) CEO Shachar Daniel On Q4 2021 Results - Earnings Call Transcript

Mar. 29, 2022 11:25 AM ETSafe-T Group Ltd (SFET)
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Safe-T Group Ltd (NASDAQ:SFET) Q4 2021 Earnings Conference Call March 29, 2022 8:30 AM ET

Company Participants

Steve Gersten - Director-Investor Relations

Shachar Daniel - Co-Founder and Chief Executive Officer

Shai Avnit - Chief Financial Officer

Conference Call Participants

Jason Kolbert - Dawson James

Brian Kinstlinger - Alliance Global Partners

Richard Molinsky - MAX Ventures

Disclaimer*: This transcript is designed to be used alongside the freely available audio recording on this page. Timestamps within the transcript are designed to help you navigate the audio should the corresponding text be unclear. The machine-assisted output provided is partly edited and is designed as a guide.

Operator

00:02 Greetings and welcome to the Safe-T Group Fourth Quarter and Full-Year 2021 Earnings Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

00:35 I would now like to turn this conference over to your host, Mr. Steve Gersten, Director of Investor Relations. Thank you, sir. You may begin.

Steve Gersten

00:44 Thank you, operator. Good morning, ladies and gentlemen. Welcome to Safe-T Group’s fourth quarter and year-end 2021 earnings results conference call. I’m Steve Gersten, Director of Investor Relations for Safe-T Group.

00:58 Before we get started, I will read a disclaimer about forward-looking statements. This conference call may contain, in addition to historical information, forward-looking statements within the meaning of the Federal securities laws regarding Safe-T Group.

01:15 Forward-looking statements include statements about plans, objectives, goals, strategies, future events or performance and underlying assumptions, and other statements that are different than historical fact.

01:32 These forward-looking statements are based on current management expectations and are subject to risks and uncertainties that may result in expectations not being realized, and may cause actual outcomes to differ materially from expectations reflected in these forward-looking statements.

01:52 Potential risks and uncertainties include those discussed under the heading Risk Factors in Safe-T's annual report on Form 20-F filed with the Securities and Exchange Commission on March 29, 2022, and in any subsequent filings with the SEC. All such forward-looking statements, whether written or oral, made on behalf of the company are expressly qualified by these cautionary statements, and such forward-looking statements are subject to risks and uncertainties, and we caution you not to place undue reliance on these.

02:34 At this time, I'd like to turn the call over to Shachar Daniel, the company's CEO. Go-ahead Shachar.

Shachar Daniel

02:43 Thank you, Steve and welcome everyone to today’s fourth quarter and 2021 year-end corporate update conference call for Safe-T Group. With me is Shai Avnit, our Chief Financial Officer.

02:55 Our main goal for 2021 was the focus on substantial growth and I am happy to share our financial results for the year, which clearly demonstrate the achievement of this growth. The actions we implemented during 2021 enabled us to achieve more than 100% growth in annual revenue, compared to last year and to expand our business quarter-over-quarter and year-over-year.

03:20 Our efforts resulted in another record quarter with revenues increasing 191%, compared to the last quarter of 2020 lifted by strong organic growth of our privacy business, as well as our penetration into the exciting consumer market. In addition to record financial results other annual highlights include the expansion to new markets worldwide, including penetration to new sectors such as privacy for the NFT sector and the launch of [few] [ph] [ph] and exciting products including an anti-malvertising solution and more.

03:59 I would like to summarize our accomplishments in 2021 and year-to-date and then discuss our roadmap for the remainder of 2022 and beyond. Over the last few years, the global pandemic and more recently international geopolitical events emphasize the need to prepare for unforeseeable situations and elevate the need for data security and privacy. Against this backdrop, we believe that the current environment requires advanced privacy and cybersecurity solutions now more than ever.

04:31 Looking back at 2021, Safe-T was well positioned to address a wide range of requirements and demand for such solutions. In 2021, we introduced several new offerings focused on cybersecurity and privacy, which addresses enterprisers on the one end and consumers on the other end.

04:50 In July 2021, we acquired CyberKick, a transaction that significantly contributes and complements our overall offering within the large consumer market space. Our technology is based on a business IP Proxy platform, which [weren’t] [ph] incorporated in the second half of 2019.

05:11 Our privacy solutions for organizations, based on an IP Proxy platform, is the world’s fastest most advanced and secure business network providing our clients with accurate, transparent and tailored personal data driven from public online sources. During the year, we launched our next generation IP Proxy network targeting largest business and B2B customer markets.

05:35 We also launched a new enterprise data collection solution or Data Collection-as-a-Service, DCaaS, enabling unlimited collections of online, public, web-based data for business analytics and secured a first DCaaS project with a global data services company.

05:52 Our enterprise privacy business continues to grow rapidly recording 63% annual growth in 2021 and gaining more momentum in the Asia Pacific region with over 75 new clients, including e-commerce and NFT organizations.

06:08 Our privacy solution for consumers includes thousands of paying users that utilize our IP Proxy platform today. As mentioned before, the acquisition of CyberKick significantly expanded and boosted our privacy for consumer business with the integration of thousands of CyberKick customers.

06:26 Our privacy solutions for consumers continue to gain traction, and in the beginning of 2022 our first product is nearing the 15,000 subscriber milestone. In addition, we launched a new malvertising protection product for Apple iOS devices, named Ad Blocker Pro. We believe that the privacy market for consumers has a great potential and we plan to accelerate our offering and efforts in this segment during 2022.

06:56 As planned, we launched the first generation of iShield, our most advanced cybersecurity product for consumers, quickly adding a new layer of protection to help consumers and small and mid-sized businesses defend against emerging ransomware attacks.

07:11 During 2022, we are planning to introduce a significant upgrade of the iShield product that would include new important features according to market research, the digital and security consumer market is expected to reach 19 billion by 2024 and we believe that cybersecurity in this segment will be one of the catalyst for our growth in 2022.

07:34 In 2021 and the beginning of 2022, global events reinforced the growing demand and need for solid tools for overcoming new cyber threats. The number and the increasing scope of cyberattack taking advantage of remote access to [organizations] [ph] causing unpresented damage to organizations. That is why after we established a worldwide network of enterprise channel partners, we made a strategic decision to collaborate with TerraZone, a global information security specialist who will accelerate global sales, marketing, and the further development of our ZoneZero Zero Trust network access software technology.

08:15 Through our collaboration with TerraZone, we expect to lower our operational expenses commencing for the third quarter of 2022, while still benefiting from the huge untapped potential of this product.

08:29 More recently, we partnered with TerraZone and DreamVPS, a global provider of cloud services to launch a first-of-its-kind virtual private workforce cloud service, and new solution provides a secure, flexible way to conduct and manage remote R&D teams and programs.

08:47 Through this kinds of creative partnerships, we believe we can more quickly and cost effectively expand our footprint in the global enterprise market. As an innovative company with advanced technologies, we believe that we have a social responsibility to support organizations dedicated to driving positive change in our world.

09:07 As such, in February 2022, we launched the Net Bridge program to provide a pro-bono service and support academic and non-profit research organizations involved in among other things detection and prevention of criminal activities, including violations of human rights.

09:24 Shortly after we added the Washington-based center for advanced defense studies as a first partner to join our Net Bridge Social Responsibility Program. We are committed to expanding this initiative to drive positive global chain to web data collection and research by adding additional partners to our program.

09:44 During 2021, our products gained validation for consumers that download and paid to use our tools for privacy and protection, as well as enterprise customers in new market sectors and geographic, maybe those will choose our solutions.

10:00 We were also named leaders by several international market research organizations including Gartner and Forrester. All of these market validations help drive our performance achieving a record of more than $10 million in revenue.

10:15 I would like to address a subject that impacted the company's expenses during 2021. Alongside calculated operational efficiency, we did [Technical Difficulty] ongoing legal proceedings brought by Luminati Networks now Bright Data.

10:30 In the last two years, Bright Data has filled several intellectual property related complaints against various players in the IP Proxy sector and we believe that this claims our end finally to weaken the profit and loss with significant legal expenses and hinder innovation.

10:47 We already demonstrated that their first complaints against us was without merit and it was dismissed without prejudice with no monetary payment paid by us to Bright Data, and with no effect on our ongoing services for customers. In June 2021, Bright Data filed another action against and this case is still ongoing and as in the first case, we disagree with each of Bright Data’s claims both against us in this second compliant and we are consistently challenging the patentability of Bright Data patent.

11:19 To-date, each of United States Patent and Trademark Office, USPTO, challenges has reached a preliminarily decision on the merit and in each decision the USPTO is preliminary grid with our position that Bright Data patent are likely and patentable.

11:37 Although patent litigation in the United States is expensive, we believe that our position [indiscernible] intend to continue to defend our operations while offering our unique technology and solutions, despite Bright Data tactics.

11:51 Now, before going further, I would like to turn the call over to Shai, to discuss the financials for the year. Shai, go-ahead.

Shai Avnit

12:00 Thank you, Shachar. I will begin with a summary of our fourth quarter and year-end 2021 financial results, which are compared to our fourth quarter and year-end 2020 results unless otherwise stated.

12:15 Revenue for the full-year of 2021 totaled $10.3 million of which $3.7 million were earned in the fourth quarter. This represents a 110% decrease, compared to the revenues of $4.9 million for the full-year of 2020, of which $1.3 million were earned in the fourth quarter. This sharp growth in revenues is attributed to the increase in enterprise privacy business revenues and the consolidation of CyberKick’s revenues following the completion of its acquisition on July 4, 2021.

12:53 Gross profit for the full-year of 2021 increased by 115% to $5.1 million of which the fourth quarter contributed $2.1 million. This compared to gross profit for the full-year of 2020 of $2.4 million of which the fourth quarter contributed only $0.5 million, representing increases of 106% and 335% respectively. These significant increases in the gross profit were primarily driven by the increase in revenue.

13:31 Research and development expenses totaled $4.8 million, compared to $2.2 million in 2020. The increase is due to the consolidation of CyberKick’s expenses that were consolidated over the second half of 2021, as well as the expansion in overall development activity of our other business segments.

13:52 Sales and marketing expenses totaled $8.3 million for the full-year 2021, an increase from $4.2 million in 2020. The increase is primarily attributed to the consolidation of CyberKick’s sales and marketing costs, as well as the increase of the enterprise privacy sales team and its related costs.

14:15 General and administrative expenses totaled $7 million in 2021 and $4.2 million in 2020. The increase is mainly due to the patent litigation cost in collection with the legal proceedings brought by and filed against Luminati Networks, now Bright Data as Mr. Daniel just mentioned.

14:38 As a result of the above changes in revenues and expenses, net loss for the full-year of 2021 was $13.1 million or $0.48 per share, as compared to a net loss of $7.8 million or $0.71 per share in 2020. Net loss in the fourth quarter of 2021 totaled $4.5 million or [$0.15] [ph] per share, compared to a net loss of $5 million or $0.28 per share in the fourth quarter of 2020.

15:14 Non-IFRS net loss, which represents the IFRS net loss after [indiscernible] effect of the noncash expenses and income for the full-year of 2021 totaled $10.3 million as compared to a net loss of $6.2 million in 2020. While the non-IFRS network for the fourth quarter in 2021 [was $3 million] [ph] versus $2.2 million in the equivalent quarter of 2020.

15:43 Cash and cash equivalents balance and short-term investment balance totaled to $9.7 million on December 31, 2021 as compared to $11 million on September 30, 2021.

15:57 And lastly, I wanted to touch based on our share count as it stands today. On an outstanding basis, we have around 30.4 million ordinary shares, representing an equivalent number of [financials] [ph]. On a fully-diluted basis, we currently have around 40.7 million shares or ADS’ outstanding.

16:19 With that, I'll turn the call back over to Shachar.

Shachar Daniel

16:23 Thank you very much, Shai. In summary, we are extremely proud of our many achievements in 2021. Our business strategy is clear and focused on providing comprehensive solution for the privacy and cybersecurity markets. Looking forward, we are confident in reaching our goal of $50 million in annual revenues in 2025, which equates to at least 50% top line growth on an annual basis over each of the next four years. We are planning on reaching this target to accelerated growth in every business segment of the company.

16:56 With that, I would like to open up the call for any questions. Operator, please go ahead.

Question-and-Answer Session

Operator

17:02 [Operator Instructions] Our first question comes from the line of Jason Kolbert with Dawson James. You may proceed with your question.

Jason Kolbert

17:36 Congratulations on the quarter. I'd like to talk a little bit about that guidance you just gave, which is great by the way, 50% CAGR to hit 50 million in 2025 and you set across all segments. I understand that, but if we can pin you down a little bit, given what's going on in the world, the number of cyberattacks, where do you want to focus the company's resource and what segment looks the most attractive to you? Thanks.

Shachar Daniel

18:06 Okay. Thank you very much for your question. We intend to continue growing as you mentioned, especially in the large consumer market where individuals are increasingly seeing the need for new and generative security and privacy products in response to [indiscernible] in a [tax data breacher] [ph]. This is especially by the way to now because of geopolitical issues. Because of this, we are constantly investing in R&D and product development programs, and expect to launch a variety of new products and services over the next few months, not few years, few months, which we believe will continue to [indiscernible] growth.

18:43 We feel new products will be available from mobile Apple iOS devices and as well as android and include the first design for Windows Desktop PCs. Hope it answered you question, Jason.

Jason Kolbert

18:57 Yes. Thank you. But I'd just like to follow-up a little bit, which is – and this might involve Shai chipping in, which is, given where you are financially, and that's 50% CAGR, how much of that is organic growth? Is there any inorganic growth in there? And what is the limiting resource? I mean, it strikes me that with more cash, more capital, you could probably build a bigger footprint. So, if you could talk a little bit about that, it would be helpful.

Shachar Daniel

19:33 Okay. Okay. Thank you. I will take it Shai. So, first of all, this projection is based on organic growth, on the current company, okay. The current company is four business lines, two for cybersecurity, and two for privacy, each of them is the consumer business lines, and organizations business line. This projection is based on our current company, our current business lines as we demonstrated this filed for example in our privacy business, we grew more than 65% organically.

20:02 So, the 50% CAGR year-over-year for the next four years in order to achieve the 50 million is our target organically. Second, for the second question, regarding the investment. Yes. So, this year, by the way, you can take a look back in our projections. We demonstrated that we’re mature enough and we have the machine that knows how to generate revenues from investments.

20:29 Now, in the next four years, it's little bit difficult to project the amount of cash that we will have, but I'm sure that as investors and funds will see the amazing growth in this company, the amazing machine that we build moved from $1.4 million in 2018 to more than 10 in 2022. I'm sure that they will trust us and we will have the right fight, the right fund, in the right time, in the right price, we want to keep our investors in order to take this company to the sky and to meet even more than these numbers.

Jason Kolbert

21:05 Perfect. Thank you so much for answering the questions.

Shachar Daniel

21:09 You’re welcome. Appreciate it. Thank you.

Operator

21:12 Our next question comes from the line of Brian Kinstlinger with Alliance Global Partners. You may proceed with your question.

Brian Kinstlinger

21:20 Hey, great. Thanks so much for taking my questions. First in response to Jason's question, you mentioned consumer as an area of focus with the political events going on, Russia, Ukraine, I guess I would have thought that the biggest benefactor would have been enterprise you’re looking to protect, not necessary consumers. So, just want to make sure I heard that right, that consumers are the ones right now spending more on cyber not enterprises?

Shachar Daniel

21:49 No, Brian, so, I took this answer regarding Safe-T, not in general. In general, I think that the effect is on everybody because there are a lot of privacy issues by the way in these countries now, okay? A lot of cyber issues for individuals and organizations. And the effect is, I think goes across all level because, but when the previous question, I've been asked about Safe-T focus for the next year and the effect of the geopolitical events, I said that we see an amazing fluctuation in two sectors.

22:23 One in our services solution for organization and the second in the consumer, and my answer was regarding the investment as I see today by the way, for the next one or two years, I guess that over the time if something goes better, maybe we can make some amendments to this strategy, but this strategy is focused on the consumer and privacy business.

Brian Kinstlinger

22:48 Okay. And then which geographies are you seeing the strongest demand for these products? Is it U.S? Is it Israel? Is it international, talk to us about where that demand is coming from right now?

Shachar Daniel

23:02 Okay. So, basically, the best geographies for us now is U.S. versus Europe and Asia Pacific. We already announced that we achieved a great milestone more than 75 customers, not consumers, but customers, organizations joined our privacy solution in the end of 2021 and since then I can tell you that the number is significantly higher. So, we see a great traction and the great demand for our products in these areas.

Brian Kinstlinger

23:33 And you mentioned your privacy solution has 15,000 subscribers. First of all, what's the monthly fee on that and which solution is that?

Shachar Daniel

23:43 This is our Armo, the name of the Apple Armo for iOS at this stage. So imagine yourself that we will lift only one product for mass production and the second is just still in the early stage and only one flavor for the iOS, it's almost in 15,000 paying subscribers in monthly and annually rate, where at this point of time, we are focusing on monthly rate, according to our research, and it's around $20 per month.

Brian Kinstlinger

24:17 Great. And then, can you quantify the legal expense for the IP Proxy claims in 2021 and maybe a forecast on what you're budgeting for 2022?

Shachar Daniel

24:28 Okay. So, Brian to be honest with you, I don't know who is on this call from the other side, and not from the capital markets, to protect this, I prefer to keep these details confidential due to the legal case that we are just – in this legal case in this moment.

Brian Kinstlinger

24:47 Okay. And then lastly – no worries. Lastly, the quarter is two days from being complete, is there seasonality we should [indiscernible] in your business or is the first quarter going to be stronger than the fourth quarter? Just maybe help us at a high level understand what's going on in the March quarter?

Shachar Daniel

25:05 We will announce the unaudited numbers, I guess between the third to the second week of April. It will be okay. Okay.

Brian Kinstlinger

25:18 Right. I mean, I'm not asking you for a number, but is there seasonality we should think about in your business?

Shachar Daniel

25:26 If it is [seasonal] [ph] – okay.

Brian Kinstlinger

25:27 Seasonal like, [indiscernible] software businesses are...

Shachar Daniel

25:32 I [didn't understand] [ph], you know in the enterprise business, yes, the second and the fourth quarter are basically in the cyber, so enterprises basically are stronger because there are budgets in the fourth quarter that the organization, especially government organization need to utilize etcetera.

25:54 In the consumer business, due to the fact that it's kind of recurring or [indiscernible] recurring revenues, I don't think that we'll see [seasonality] [ph]. It depends in many other events. They are big sport events, geopolitical events, you know for example the COVID for us, you know changed dramatically the numbers from positive perspective lockdowns, etcetera, but I don't think at this stage that we will see seasonality, we are planning to grow to see the growth quarter-over-quarter.

Brian Kinstlinger

26:24 Okay. And actually I have one more question on the expense side. In the fourth quarter, your peak of operating expenses, but I thought I read quickly in your comments on the press release, I think if you are looking at cost cutting or measures, synergies maybe from the acquisitions, how should we think about operating expenses as you move into 2022?

Shachar Daniel

26:49 Okay. So, as mentioned in the PR and also now in the investors call, I mentioned, we made a significant transaction. I worked on this transaction a few months. We convinced a group of veterans from the cybersecurity space. The name is TerraZone. And they are totally huge deliveries in our products, also they are, kind of made a new offering for our previous product, which is the secure e-mail and secure vaults.

27:18 And together with DreamVPS they took our products and they are in-charge on the R&D marketing and sales. So, meaning this transaction sometime takes time, you know slowly, slowly it will go down, but from the third quarter, we need to see a change of a significant, kind of transaction from the expenses from Safe-T to TerraZone and we have a rev share agreement with them.

27:44 We already announced it and we will bear fruit from this successful, but the expenses will be on the other side. We will be focusing the privacy and the consumer from R&D and sales and marketing perspective.

Brian Kinstlinger

27:56 That's great. So, how long do you think that takes to transition from your books to theirs? Is that going to be probably after the second quarter or are we going to see that right away in the first quarter just maybe…?

Shachar Daniel

28:08 So, the cut, the final cut will be in the third quarter, but we need to start to see it from now, but the final cut would be third quarter of this year.

Brian Kinstlinger

28:18 Great. Alright. Thanks so much.

Shachar Daniel

28:21 Thank you, Brian.

Operator

28:23 Our next question comes from the line of Matt Jenkins, Private Investor. You may proceed with your question.

Unidentified Analyst

28:31 Hi, Shachar. You know, I've been a long-term shareholder and can’t tell you how happy I am with this report, it really seems like we are on the cusp of something special. And just want to say keep up the great work and I hope that…

Shachar Daniel

28:46 Thank you very much.

Unidentified Analyst

28:47 …your comments today spread across the investment community, because I think that currently not many people see the value that I'm seeing, but that being said, when you talk about investing and consumer customer acquisitions, does that mean the growth in your consumer business? And is it all online? Is the majority of that revenue monthly recurring revenue?

Shachar Daniel

29:14 Yes. So, just to make sure that I understand your question, Matt, so first of all, yes, at this stage from the consumer in the consumer business line, at this stage, we will change this maybe very soon to have an annual recurring revenue, it's monthly recurring revenue, our paying strategy or paying method is monthly payment. So, it's monthly recurring revenues as I mentioned to the previous question by Brian, it's around $20 per month.

29:43 And this is one of our major focuses in this year because we see a huge demand, and a great team. By the way we have one of the best teams, maybe in Israel, maybe globally for consumer acquisition in the consumer space and we think that it can touch the sky in the next year. So, this is why we are focusing here. And of course, also in the privacy business for enterprises because the demand is amazing, although we have the legal issue we think that it will be behind us as I mentioned, and we can take it also further.

Unidentified Analyst

30:19 Great. Based on this growth that I'm witnessing, I mean, I'd be surprised if you guys are not in acquisition target for some of these larger cybersecurity companies. I know you can't say that you've been contacted or anything, but I hope that we don't get acquired because this growth is stunning and looking forward to many years to come.

Shachar Daniel

30:45 Thank you very much. By the way for your comment. So, yes, the industry is already in a consolidation part. Take a look, for example, just lastly, there is a $90 million acquisition of Express VPN by Kape, okay. In fact, given the fact that we made successful acquisitions, the last two years, we certainly believe that this is not our strategy, okay.

31:11 We want to grow, we want to establish a big company, but our company is very interesting, also now, and I’m sure in the future for interesting creditors that will want to larger business and to get a greater technology with, kind of a great recovery revenues.

Unidentified Analyst

31:29 Great. Thanks a million.

Operator

31:32 Our next question comes from the line of [Bobby Keiser] [ph] with Dawson James. You may proceed with your question.

Unidentified Analyst

31:41 Hey, guys, first off, congratulations. And then you mentioned a couple of times now just the consumer side of the business, which is around $20 a month and revenue. And then if you could just maybe comment and touch upon the enterprise side and maybe what you see as an average contract size?

Shachar Daniel

32:01 Okay. So, we have two business lines in the enterprise side of the company. One is a privacy that they discussed in length about it now? And the second one is the cybersecurity, which I will also mention now, but I will repeat to summarize. So, by the way, from revenues perspective, at this point of time, our projection is around 60/40. 60 from consumers, 40 from the enterprise business.

32:31 In the enterprise business, we totally are progressing in the privacy. As I mentioned, from 2020 to 2021 we have an organic growth of more than 65%, and we project that this growth is a trend and will go on for the next year. And in the cybersecurity, we partnered with TerraZone and DreamVPS and we have a very unique new offer of secure e-mail, secure vaults, and secure remote access.

32:59 We are offering this product now at this stage of the penetration to DreamVPS customers, which most of them are small-medium business because they need one-stop shop to keep their data and to exchange their data and they have a lot of regulation on the headline for example Lawyer Officers, Legal Officers, [PCAs] [ph], etcetera.

33:19 Regarding the average deal price. So, I can tell you that I don't want to mislead because the variation is huge. I can tell you, for example, that in the last month, we have one deal of $75,000 and one deal of $1,000 because we are pricing our product in the privacy according to capacity and throughput not according to end users and sometime it's totally changed between customer need to other customer needs.

33:49 So, I don't want to mislead, but you saw the numbers, you saw the growth and this is, I think can give you the most accurate picture of the company.

Unidentified Analyst

34:04 Okay. Thank you. So, is it priced more on like – how do you get those two different sizes? I mean, usage basis or is it more of a, like products you're using?

Shachar Daniel

34:19 Of course usage and features, okay? But not according to end users. It’s usage and features. We have premium, we have lower levels, it depends in your need and in the amount of data, okay? It's what I call usage or throughputs, okay, gigabyte, megabyte terabyte, etcetera?

Unidentified Analyst

34:46 Okay, awesome. Thank you, guys.

Shachar Daniel

34:49 You're welcome.

Operator

34:51 Our next question comes from the line of Richard Molinsky with MAX Ventures. You may proceed with your question.

Richard Molinsky

34:59 Yes. Well congratulations. Quick question, you mostly answered it anyway, but I'll just ask it anyway. How you maintain your topline growth and what areas of the company will bring you this growth? That's it and congratulations again.

Shachar Daniel

35:16 Okay. So, I think everybody asked about it, but I don't – I will repeat, okay?

Richard Molinsky

35:25 Yes.

Shachar Daniel

35:26 So, first of all, we intend to continue growing especially in the large consumer markets and in the privacy for organizations, because we implicitly see the need for new and innovative security and privacy products, okay? Especially in response to the market increasing in the attacks and data breachers [just lastly] [ph] because of the geopolitical issues, but in general, it grows higher and higher every year, okay? Because of this, we are constantly investing in R&A and product development programs and expect to launch a variety of new products and services over the next few months, which we will be able to continue to drive this growth, and to fuel this growth.

36:08 Additional products will be available in mobile app iOS and android and especially, we will launch the first design for windows, desktop, and PCs. So, this is how we will fuel our growth with new products, new features, innovation, disruptive technology. We have one of the best sales and marketing teams as I mentioned, and they know how to sell it. We just need to have the right product. We have great product guys. Great research team that know to predict the next market need.

36:36 For example, I can tell you that I'm very proud to say that we started to discuss about securing more taxes in the enterprise side, but it's the same guy, okay? Much time before COVID, then COVID came and proved everybody why secure, why remote access and of course secure remote access is so important, it’s so crucial. This is my answer.

Richard Molinsky

36:58 Appreciate. Thank you so much. Appreciate it. Keep up the great job.

Shachar Daniel

37:02 You’re welcome. Thank you.

Operator

37:04 Our next question comes from the line of Brian Kinstlinger with Alliance Global Partners. You may proceed with your question.

Brian Kinstlinger

37:11 Hey, Shachar, one follow-up. So, when I look at [Armo] [ph], 15,000 subscribers at $20 a month, puts you at around $3.6 million a year, want to make sure that's right. That sounds right to you? But then second, as I think the math is pretty sound, can you talk about how many – first of all, when was this product launched? And how many subscribers did you have say six months ago and say a year ago? I'd like to assess the growth rate of that product?

Shachar Daniel

37:42 Okay. So, basically, we started with this product something like, even before the acquisition, okay. The guys started with this product, I think in [March] [ph] or something like this [story] [ph]. Sorry, I will be totally honest, I don’t care to send it to you if you send me – I don’t have the exact number of subscribers in front of me now at this stage of each month. But I can tell you, for example that in the end of the year, we announced, by the way, we were in around 10,000 and now we are almost in 13,000, okay. And it depends totally Brian in the amount of investment.

38:25 You know, as much as we will invest in acquiring consumers, we will see totally different numbers. We have the machine. Machine is the formula. We know how to generate revenues and consumers for media buying, okay? [Depends] [ph] on us in the amount of cash, etcetera.

Brian Kinstlinger

38:46 So, if I understand it was launched in March of 2021. You were at 10,000 by the end of the year, and you are at 15,000 today and growing rapidly, and essentially it’s how much capital you want to put into acquiring customers? Do I have that right?

Shachar Daniel

39:05 Yes.

Brian Kinstlinger

39:05 Okay. Great. Thank you.

Shachar Daniel

39:08 You’re welcome.

Operator

39:10 Ladies and gentlemen, we have reached the end of today's question-and-answer session. I would like to turn this call back over to Mr. Shachar Daniel for closing remarks.

Shachar Daniel

39:20 Thank you very much. So, to close today's call, I want to say that our vision has always been to become a leading provider of privacy and cyber-security solution. And we plan to continue investing to achieve it.

39:34 We are investing into upgrading and refining our products, as well as introducing innovative new solution for consumers and enterprisers. We believe that Safe-T today is better positioned than ever and then market opportunity is even greater than we imagined.

39:50 Our board and management team are committed to take this company to the next stage in terms of market solutions and revenues in 2022. If you have any further questions, please contact Steve Gersten, our Director of IR. Thanks a lot for joining us today. We look forward to continuing to update you on our progress and we're really exciting from our results and for the future. Thank you very much.

Operator

40:14 This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation. Enjoy the rest of your [Ends Abruptly].

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