Conversation 156:
Why Gefen Technologies ASX IPO is no laughing matter.
Did you hear the one about the lawyer and the fighter pilot who walked into a bar?
I know it sounds like a joke but essentially that is how Gefen Technologies, a recent IPO announcement for the Australian Stock Exchange came into life.
After a thirty minute initial meeting turned into a five hour strategy session, David Nash [mild mannered lawyer] and Orni Daniel [ex-F15 fighter pilot, both from Israel] hatched the idea of Gefen.
Like one of the more popular ASX technology stocks, BigTinCan [ASX:BTH}, Gefen’s Software as a Service [SaaS] platform, targets tier one organisations and allows them to turn a traditional sales force into a digital network.
This creates an infrastructure pipeline that allows the latest marketing and sales information, along with data on how it is playing in the field, to flow between HQ and staff on the ground.
So far, Geffen has focused on insurance and finance but with the money from its float, the company plans to take a broader approach.
Since March last year, the already listed BigTinCan and its similar service has more than doubled in share value. The company's recurring revenue has grown from $7 million in 2016 to $35 million in 2019. The company is still tipping 30% to 40% growth this year.
So one thing is clear, there's a great market for this type of product.
Going after a broader market is one of the key things Gefen says it will use its fifty million dollar IPO for, along with a strong appetite for mergers and acquisitions.
Gefen claims a 100% increase in productivity and a Net Promoter Score of 8.4, which is a reflection of how strongly customers feel about referring the product, and is well above the industry norm.
A second player with an established proven technology in a market that is clearly popular and growing, shouldn't have any trouble raising interest in an IPO starved market.
I caught up with the two founders from their homes in Tel Aviv recently.
