mac equity partners - home - pointerra...geospatial analysis is an approach to applying statistical...

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Mac Equity Partners Equity Capital Markets CAPITAL STRUCTURE GICS Sector Internet Software & Services Shares on Issue (m) 326 Current Share Price ($) 0.027 Market Cap ($m) 8.8 Cash ($m) 3.7 Debt ($m) 0 52 Week High/Low ($) 0.053/0.017 POINTERRA LTD (ASX:3DP) | EQUITY RESEARCH KEY MANAGEMENT Rob Newman Non Exec. Chairman Ian Olson Managing Director Graham Griffiths Non-executive Director Shane Douglas Chief Technology Officer SURVEYING THE GLOBE FOR FUTURE SHAREHOLDER VALUE The global geospatial industry is booming. New and more affordable scanning technology and a desire from organisations to visualise their projects in 3D is creating massive amounts of data. So much in fact, that storing, managing, visualising and sharing the data has become extremely difficult and costly for businesses. Pointerra is solving this problem. Their unique, patent pending technology allows anyone anywhere in the world to access, manage and visualise terabyte sized datasets on a secure cloud-based system all from a web browser on their computer, tablet or mobile. Pointerra has an undiluted market cap of ~$8.8m with $3.7m in the bank and are aggressively capitalising on their global first mover advantage by partnering with some of the largest geospatial companies in the world. ü MoU signed with WorleyParsons | The partnership will promote 3DP’s tech as a digital asset management solution to clients in the hydrocarbons, infrastructure, chemicals, and minerals and metals sectors. ü Partnership with Blue Marble Geographics | 3DP’s technology integrated into established and widely used “Global Mapper” software. ü Significant partnership for sale of 3D data | One of the largest LiDAR surveyors in the world will use 3DP’s technology and web browser interface as a shop-front to sell ten years of historical 3D data. ü ESRI Partnership | 3DP’s technology will be integrated into “ArcMap” and promoted to Esri’s worldwide customer base. ü World first online market place | 3DP have developed a world first online market place where owners of 3D data can monetise their previously unused datasets. ü Successfully converted trial licenses to paying customers | Terrestrial and aerial data capture organisations operating in the surveying geospatial sector are now paying customers and resellers of 3DP’s Data as a Service solution. ü Presentation at major LiDAR Conference | 3DP recently unveiled their ‘Open Government Data’ capability at the annual LiDAR Conference in Denver Colorado. MAC EQUITY PARTNERS Jason Skinner | M: +61 439 975 723 [email protected] Matthew Sheldrick | M: +61 417 923 155 [email protected] Josh Chadwick | M: +61 439 986 902 [email protected] Hugh Pilgrim | M: +61 449 581 256 [email protected] 0 2 4 6 8 10 0 0.005 0.01 0.015 0.02 0.025 0.03 0.035 0.04 0.045 0.05 Vol(m) P($) PERFORMANCE SINCE LISTING KEY COMPANY MILESTONES SINCE LISTING ABOUT THE COMPANY Pointerra listed on the ASX in July 2016 through a backdoor listing and $5m capital raising. The Company’s innovative cloud-based 3D data technology allows users all over the world to access, analyse and share massive amounts of previously unmanageable data instantaneously over a secure network. 3DP is managed by an experienced Board, headed by Managing Director Ian Olson and overseen by non-exec Chairman Rob Newman, who is also CEO of Nearmap Ltd a successful ASX listed geospatial company.

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Page 1: Mac Equity Partners - Home - Pointerra...Geospatial analysis is an approach to applying statistical analysis and other analytic techniques to data that has a geographical or spatial

Mac Equity Partners Equity Capital Markets

CAPITAL STRUCTURE

GICS Sector Internet Software & Services

Shares on Issue (m) 326

Current Share Price ($) 0.027

Market Cap ($m) 8.8

Cash ($m) 3.7

Debt ($m) 0

52 Week High/Low ($) 0.053/0.017

POINTERRA LTD (ASX:3DP) | EQUITY RESEARCH

KEY MANAGEMENT

Rob Newman Non Exec. Chairman

Ian Olson Managing Director

Graham Griffiths Non-executive Director

Shane Douglas Chief Technology Officer

SURVEYING THE GLOBE FOR FUTURE SHAREHOLDER VALUE

The global geospatial industry is booming. New and more affordable scanning technology and a desire from organisations to visualise their projects in 3D is creating massive amounts of data. So much in fact, that storing, managing, visualising and sharing the data has become extremely difficult and costly for businesses. Pointerra is solving this problem. Their unique, patent pending technology allows anyone anywhere in the world to access, manage and visualise terabyte sized datasets on a secure cloud-based system all from a web browser on their computer, tablet or mobile. Pointerra has an undiluted market cap of ~$8.8m with $3.7m in the bank and are aggressively capitalising on their global first mover advantage by partnering with some of the largest geospatial companies in the world.

ü MoU signed with WorleyParsons | The partnership will promote 3DP’s tech as a digital asset management solution to clients in the hydrocarbons, infrastructure, chemicals, and minerals and metals sectors.

ü Partnership with Blue Marble Geographics | 3DP’s technology integrated into established and widely used “Global Mapper” software.

ü Significant partnership for sale of 3D data | One of the largest LiDAR surveyors in the world will use 3DP’s technology and web browser interface as a shop-front to sell ten years of historical 3D data.

ü ESRI Partnership | 3DP’s technology will be integrated into “ArcMap” and promoted to Esri’s worldwide customer base.

ü World first online market place | 3DP have developed a world first online market place where owners of 3D data can monetise their previously unused datasets.

ü Successfully converted trial licenses to paying customers | Terrestrial and aerial data capture organisations operating in the surveying geospatial sector are now paying customers and resellers of 3DP’s Data as a Service solution.

ü Presentation at major LiDAR Conference | 3DP recently unveiled their ‘Open Government Data’ capability at the annual LiDAR Conference in Denver Colorado.

MAC EQUITY PARTNERS

Jason Skinner | M: +61 439 975 723

[email protected] Matthew Sheldrick | M: +61 417 923 155

[email protected]

Josh Chadwick | M: +61 439 986 902

[email protected]

Hugh Pilgrim | M: +61 449 581 256

[email protected]

0

2

4

6

8

10

00.0050.010.0150.020.0250.030.0350.040.0450.05

Vol(m)

Millions

P($)PERFORMANCESINCELISTING

KEY COMPANY MILESTONES SINCE LISTING

ABOUT THE COMPANY

Pointerra listed on the ASX in July 2016 through a backdoor listing and $5m capital raising. The Company’s innovative cloud-based 3D data technology allows users all over the world to access, analyse and share massive amounts of previously unmanageable data instantaneously over a secure network.

3DP is managed by an experienced Board, headed by Managing Director Ian Olson and overseen by non-exec Chairman Rob Newman, who is also CEO of Nearmap Ltd a successful ASX listed geospatial company.

Page 2: Mac Equity Partners - Home - Pointerra...Geospatial analysis is an approach to applying statistical analysis and other analytic techniques to data that has a geographical or spatial

MAC EQUITY PARTNERS | Equity Research

Geospatial analysis is an approach to applying statistical analysis and other analytic techniques to data that has a geographical or spatial context. Analysis typically employs software capable of rendering maps, processing spatial data, and applying analytical methods to terrestrial or geographic datasets, including the use of geographic information systems and geomatics. One form of geospatial data is ‘Point Cloud Data’. Point cloud data is a set of data points usually defined in an X,Y and Z coordinate arrangement. Point cloud data is an important source for 3D geo-information. Modern big data acquisition and processing technologies such as laser scanning from airborne, mobile or static platforms have the potential to generate point clouds with billions (or even trillions) of 3D points.1 Data is viewed in 3D on high powered computers and software to enable surveyors, mining, oil and gas, construction and numerous other companies to manage, analyse and accurately measure projects. HOW IS DATA COLLECTED? Primarily, point cloud data is collected using aerial LiDAR or Terrestrial Laser Scanning (TLS). LiDAR and TLS are optical remote-sensing techniques that uses laser light to densely sample the surface of the earth, producing highly accurate x,y,z measurements represented as point clouds. The real benefit of LiDAR and TLS when compared to other traditional surveying techniques such as photogrammetry is that they produces highly accurate cloud datasets.

Figure 1: Aeronautical LiDAR data capture

The volume of 3D point cloud data from LiDAR, TLS, multi-beam echo sounding, and dense image matching from photos is rapidly increasing as technological advancements continue to make acquisition cheaper and easier. Once collected, point cloud data has had to be stored on data management systems and viewed through expensive software and computer systems.

WHAT IS GEOSPATIAL DATA?

POINTERRA LIMITED

Point cloud data is complex (multi-dimensional), large in size (billions to trillions of points) and require special software handling for efficient access and analysis. As new technology has evolved, increasing the size of point cloud data, datasets have become too massive to be handled efficiently and cost effectively by current widely used software and computer systems. As volumes of point cloud data have increased, performance has become critical, both with respect to data storage/transfer size and to speed (for rendering and quickly visualising 3D data). Many 3D datasets have become so large that they can only be viewed in their entirety using high performance computers, expensive specialised software and a spatial data expert that knows how to operate the systems. Other widely used and cost effective methods of storing, visualising datasets are not delivering the performance companies demand. As a result, much of the data that is captured by Government agencies and private companies is increasingly underutilised because the datasets cannot be cost effectively managed or visualised.

Pointerra has developed an innovative cloud-based solution that gives anyone, anywhere in the world the ability to store, visualise and share entire 3D datasets, all from their computer, tablet or phone. The system has inbuilt privacy protocols, allowing users to confidently share data with staff, customers or partners across the secure cloud network. The web browser user interface has many of the features and capabilities of traditional geospatial software and can display all forms of point cloud data. For a fraction of the cost and from any device anywhere in the world users can take advantage of modelling and analysis functions (measuring height, volume, area etc) as well as cross sectional and multi point cloud visualisation options including, intensity, elevation, RGB and point density. Data owners can also monetise previously underutilised, cumbersome data sets through Pointerra’s world-first online market place at no up-front cost. Third parties are able to view and purchase curated datasets from online catalogues managed by Pointerra, and extract desired sections or whole datasets as and when required. Storing and viewing point cloud data in the cloud is considerably cheaper and faster than storing data on physical storage devices. Using Pointerra’s AWS deployed cloud solution, users can analyse their data in real-time at very high speeds and in resolutions not previously possible using traditional computer-storage device combination.

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POINTERRA HAS THE SOLUTION

A GLOBAL DATA PROBLEM

Page 3: Mac Equity Partners - Home - Pointerra...Geospatial analysis is an approach to applying statistical analysis and other analytic techniques to data that has a geographical or spatial

MAC EQUITY PARTNERS | Equity Research

GLOBAL MARKET OPPORTUNITY

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POINTERRA LIMITED

ADDRESSABLE MARKETS Pointerra is targeting high-value channel partners and end-user sectors. 3D point cloud data is applicable to a variety of industries. Potential clients are extensive and include surveyors, government agencies, construction and engineering, infrastructure and utilities, oil and gas and mining. INDUSTRY SIZE and FUTURE GROWTH The global geospatial and GIS markets are large and growing. The geospatial analytics market is expected to grow from US$30.71 billion in 2016 to US$73.91bn in 2021 operating at a compound annual growth rate (CAGR) of 19.2%.2 Global GIS market is expected to reach US$14.6bn by 2020 operating at 11.4% CAGR.3 The global 3D scanning market will be US$5.7bn by 2021 at CAGR of 13.6%.4 The growth rates exhibited by these industries are some of the highest of any market and are proof of the increasing usefulness of 3D geospatial data in our technological and connected world. The blue sky potential for 3D point cloud data to be integrated with classified conditions, artificial intelligence and holograms is real and not remote. As 3D technology becomes increasingly sophisticated and embedded with more and more analytical information, the size and applicability of the market to numerous industries will only grow.5 NO DATA IS TOO BIG 3DP’s compression algorithm and cloud-based delivery of point cloud data allow big business and Government to visualise terabyte-sized 3D datasets in a web browser. Aerial LiDAR and TLS scanning companies often have to reduce the number of data points being scanned in order for their customers to be able to cost effectively manage, view and store the data. Pointerra’s unique compression/rendering algorithms and cloud based web solution can utilise LiDAR and TLS’ maximum scanning capability. The subsequent 3D data produces a clearer, almost photo like quality. There is no detrimental effect to rendering speeds and no matter how big the dataset is it can be stored in the cloud without the need to increase capital expenditure on storage devices. This is a huge competitive advantage to Pointerra, and expands an already substantial and established market segment. CREATING A NEW MARKET PLACE Pointerra’s online market place gives businesses the ability to turn what is traditionally a liability collecting dust on a hard-drive into a money-making asset with no upfront costs to the company. Terabytes of 3D point cloud data can be uploaded to the online market place by geospatial companies all over world. Surveyors and other geospatial participants can view and purchase data directly from Pointerra’s online market place, rather than spending considerable time and money on scanning and rendering a 3D dataset that may already exist.

The ongoing success of LiDAR, the adoption of technology for conversion of other sources to point cloud data, and the increased awareness that 3D data provides will continue to propel interest in the collection and storage of point cloud data. Pointerra’s technology is in the unique position of being able to be adapted and integrated into multiple segments within the geospatial and GIS industries. The vast and ever increasing quantities of unmanageable point cloud data present a global opportunity for Pointerra to capitalise on.

Figure 2: 3D dataset of a stadium captured using TLS

Pointerra’s unique Data as a Service business model provides diversification in revenue. A diversified revenue model reduces cash flow risks commonly encountered by newly listed companies. Seven defined revenue streams have been identified by management. Initially, Pointerra will target revenue generated from Data Capture Professionals and Reseller Customers of Data Capture Professionals as the most important revenue streams in the short term. The ‘low hanging fruit’ from strategic revenue share and on-sell arrangements with global Data Capture Professionals has the potential to generate sizable revenue in the short term. With two revenue streams generating cash flow, management then have the ability to turn their full attention to the other five lucrative revenue streams to gradually build an established Data as a Service business with a diversified revenue and customer base.

DIVERSIFIED REVENUE MODEL

Page 4: Mac Equity Partners - Home - Pointerra...Geospatial analysis is an approach to applying statistical analysis and other analytic techniques to data that has a geographical or spatial

MAC EQUITY PARTNERS | Equity Research

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POINTERRA LIMITED

COMMERCIALISATION THROUGH STRATEGIC PARTNERSHIPS ASX COMPARISONS

Nearmap (ASX:NEA) uses a specialised camera, super-computers and its own Hypervision software to create what Nearmap calls “Photomaps”. Detailed visual and topographical formats are sold to users who survey and measure locations remotely. The latest version of Nearmap’s technology allows it to provide 3D models. Nearmap have 7,500 customers globally and $41m annualised contract value.7 Spookfish (ASX:SFI) operates a similar business model to Nearmap, but is at a less commercialised stage.

Figure 3: Nearmap aerial imagery

The difference between NEA/SFI and 3DP is that 3DP uses point cloud data to create a 3D model, whereas NEA/SFI are using high-resolution aerial imaging. Pointerra’s 3D point cloud image is less detailed as an image but is considerably more useful for geospatial modelling, analytics and engineering purposes. The market size for 3D point cloud imaging is also orders of magnitude larger than the aerial imaging market.8

Figure 4: Point cloud derived 3D image from terrestrial LASER

Company Share Price

Market Cap

Commercialisation stage

Nearmap $0.55 $200m Commercialised Spookfish $0.093 $80m Advanced Pointerra $0.027 $8.8m Intermediate

Pointerra’s market cap is a fraction of Spookfish and is a minnow in comparison to Nearmap. Pointerra’s cloud based technology is first in class and globally significant for the 3D geospatial industry. It is conceivable that signing large licensing and revenue share agreements could see Pointerra’s market cap on par with the likes of Spookfish and approach Nearmap’s in the longer term.

Pointerra’s commercialisation strategy is to partner with large established geospatial organisations to gain direct access to end users and customers of Pointerra’s technology to fast track revenue with minimal marketing expenditure. The low cash burn strategy is scalable across multiple target industries and ensures shareholder value is not diluted through regular capital raises. Pointerra has already secured a number of important partnership agreements with private and public sector organisations both in Australia and overseas. The Company also has a number of existing trial licenses of their technology in multiple industry sectors including a bulk commodity company, two oil and gas companies, a road network owner and a geospatial technology company. ESRI – ArcMap Integration Environmental Systems Research Institute (ESRI) has been creating GIS software for over 30 years and is recognised as the leader in GIS software. It has been estimated that 70% of GIS users use Esri products.6 Pointerra and strategic partner NGIS Australia have recently completed the integration of Pointerra’s technology into Esri’s ArcMap. The plug-in browser service is now being marketed to both NGIS and Esri customers, providing sales opportunities to government and tier one customers. Pointerra has also signed an MoU with Advisian Digital Enterprise, a subsidiary of Australian Engineering company Worley Parsons. Pointerra’s Data as a Service technology will be added to Advisian’s digital asset management offering. Advisian will promote the technology to their international clients in the hydrocarbons, infrastructure, chemicals, and minerals and metals sectors. Revenue will be generated from direct sales to Advisian’s project clients. Advisian’s consulting expertise and direct access to some of the biggest 3D data users in the world represents a valuable path to commercialisation and recurring revenue. Blue Marble Geographics – MoU Blue Marble and Pointerra’s technical teams have integrated Pointerra’s 3D point cloud data technology into Blue Marble’s widely used “Global Mapper” GIS software. The parties will co-market and promote the integrated solution to Global Mapper’s significant international customer base and global sales channels through a revenue share model. The Blue Marble partnership provides Pointerra with extremely valuable direct marketing to global geospatial 3D end users. Pointerra is in discussions with government agencies in the US and some of the largest and most influential companies in the global aerospace, engineering and technology industries. Strategic partnerships to develop, promote and sell 3DP’s DaaS technology within these industries will fast track the global adoption and commercialisation of 3DP’s cloud based service within the booming 3D geospatial market.

Page 5: Mac Equity Partners - Home - Pointerra...Geospatial analysis is an approach to applying statistical analysis and other analytic techniques to data that has a geographical or spatial

Rob Newman Non-Exec. Chairman

Rob Newman has established a unique track record as a successful high technology entrepreneur in both Australia and Silicon Valley. Rob’s focus is on identifying disruptive technologies with global potential. Rob is an active director on a number of high technology companies including CEO and Managing Director of Nearmap Pty Ltd. Rob has been the inventor and founder of multiple high technology companies with a combined established market values of over $200M.

Ian Olson Managing Director

Ian is a Chartered Accountant and professional company director with a 25 year career in finance and the capital markets. Ian was until recently the owner of WKC Spatial, a geospatial business that specialised in the capture, processing, modelling and management of 3D point cloud data. Ian started his career with Ernst & Young and has worked in London and New York with global investment banks. He is also the Non-executive Chairman of Gage Roads Brewing Co Ltd.

Shane Douglas Chief Technology Officer

Shane is a graduate in physics and computer science with over 30 years experience in software development. Shane created the core technology behind Pointerra and continues to be involved in further development. Since 1989 Shane has been developing software in 2D and 3D spatial environments for large organisations such as the Water Corporation of Western Australia and Rio Tinto.

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MAC EQUITY PARTNERS | Equity Research

DISCLAIMER | This document has been prepared by the Sales, Trading and Investment Advisory department and not by a Research department. Mac Equity Partners seeks to and does business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this as only a single factor in making their investment decisions. The company featured in this document should be considered speculative in nature and carry a high degree of investment risk. Please consider if investments in these types of companies are appropriate for your personal circumstance.

This document accurately expresses the personal view of the Author at the time of writing. Mac Equity Partners Pty Ltd (AFSL 338731, ABN 32 126 369 640), its directors, associates and employees advise that they may hold securities, may have an interest in and/or earn brokerage and other benefits or advantages, either directly or indirectly from client transactions arising from any advice mentioned in publications to clients. Directors, associates and employees of Mac Equity Partners Pty Ltd from time to time may hold shares in the security/securities mentioned in this Research document and, therefore, may benefit from any increase in the price of those securities.

This research note has been prepared for and is intended for Wholesale Investors only as defined by Section 761G of the Corporations Act, 2001. In accordance with Section 949A of the Corporations Act 2001, this document contains unsolicited general financial information only. In preparing this document Mac Equity Partners Pty Ltd did not consider the investment objectives, financial situation and particular needs (‘financial circumstances’) of any particular person and no recommendation (whether express or implied) contained in this document should be considered reliable. Accordingly, before acting on any information contained in this document, you should assess whether the information is appropriate in light of your own financial circumstances or contact your Mac Equity Partners Pty Ltd adviser.

Mac Equity Partners Pty Ltd believe that the information herein is accurate however no warranty of accuracy or reliability is given in relation to any information or information contained in this publication and no responsibility for any loss or damage whatsoever arising in any way for any representation, act or omission, whether express or implied (including responsibility to any persons by reason of negligence), is accepted by Mac Equity Partners Pty Ltd or any officer, agent or employee of Mac Equity Partners Pty Ltd.

© 2015. No part of this report may be reproduced or distributed in any manner without permission of Mac Equity Partners Pty Ltd

POINTERRA LIMITED

MAC EQUITY PARTNERS PTY LTD AFSL: 338731 ABN: 32 126 369 640 SUITE 7, 29 THE AVENUE, NEDLANDS, WA 6009, AUSTRALIA

T: +618 9386 9577 F: +618 9389 1464 E: [email protected] WWW.MACEQUITY.COM.AU

BOARD & MANAGEMENT

1. Point cloud data management, Peter van Oosterem: presentation abstract at IQmulus Workshop on Processing Large Geospatial Data

2. Markets and Markets: Geospatial Analytics Market – Global forecast to 2021

3. http://www.prnewswire.com/news-releases/global-geographic-information-system-gis-market-expected-to-grow-at-11-cagr-during-2015---2020-ps-market-research-567650721.html

4. Allied Market Research: 3D Scanning Market, 2012 -2021

5. http://www.clearedge3d.com/classified-point-cloud-future/

6. https://www.gislounge.com/gis-software-applications/

7. Nearmap Half Year Presentation to 31 Dec 2016

8.AlliedMarketResearch:AerialImagingMarket,forecast$2.8bnmarketsizeby2022.

REFERENCES KEY RISKS

Commercialisation risk: 3DP are commercialising through partnerships. Without the ability to sign large groups commercialisation is hampered. Competing technology: Competing cloud based technology could pose a threat to 3DP. Funding risk: Although low on cash burn the ability for the company to remain going concern relies on funding from capital markets. Management risk: The successful commercialisation of the technology relies on management’s ability to execute their business plan and sign partnership/licensing agreements.