Founded in 2000, software and services company IMlmobile provides mobile engagement solutions to customers globally. Last September, it snapped up Archer Digital, the MMS solutions leader in South Africa. CEO Jay Patel tells Telecom Finance about the company’s projects and his predictions for the wireless market.
Pauline Renaud: Could you tell us about IMlmobile’s business?
Jay Patel: IMimobile is a software and services company and our business is to help our customers, which are mainly telecoms operators and blue chip organisations, to better communicate with their own customers using mobile and digital technologies.
These communications include different types of customer services such as fraud alerts, appointment reminders, billing notices, etc.
And these messages can be delivered via SMS, voice calls, emails and push notifications. With 02, for instance, we are responsible for coordinating all their digital communication.
PR: You were initially a venture capital investor in the company and you are now the CEO. Why did you decide to make the transition?
JP: As an investor, I believed we needed to take the company further in this very fast moving environment. IMimobile started doing business properly in 2003, even before smartphones came along. A lot has changed since.
The essence of our business has remained the same but the devices and the interface have changed and will continue to do so, becoming even more complex.
Our strategy is to make long-term investments and make sure we remain a well-diversified business.
PR: Talking about investments, you bought Archer Digital in September for US$5.6m. Why this purchase?
JP: Archer Digital is the leader in MMS and marketing solutions in South Africa and they’ve been very successful with banks. They have access to all the big banks and large utilities in the country.
Although more than 50% of our customers are telecoms operators at the moment, an increasing number are in the banking sector. That’s why Archer was an attractive proposition for us.
PR: Are you considering other such acquisitions? Would they be financed with debt, equity?
JP: We are always open to new opportunities but we would be looking at a company with quite a few customers and where there are integration and cross-sell opportunities. IMimobile is already present in the UK, India, Africa, and the US and we’re not planning to expand outside of English speaking countries. But we’ll continue to focus on our core markets, especially the US to capitalise on the strong competition among operators there.
We have a strong cash position – since 2010, £30m of free cash has been generated – we are debt-free and we’re not planning to raise more debt at present. Our main objective, when we listed on AIM in 2014, was to get access to cash.
PR: In terms of revenues, where are you the strongest?
JP: In the six months to September 2015, our performance remained particularly strong in Europe, while in the Middle East and Africa, we secured and renewed some very large customer contracts. In India, we have felt the impact of regulation and licence fees that did not repeat.
Overall, our revenues increased 29% in the six months to September 2015 to £27.8m year-on-year and our operating profit grew 25% to £3.4m.
PR: What trends do you expect will impact your business?
JP: Voice, as an interface, is going to be the next big thing, with the rise of voice recognition technology. The nature of telecoms operators is also going to change dramatically and it’s very hard to predict how they’ll look like in the next few years
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