Now presenting Duncan McCready, IC Group.
I didn't see a standing ovation or any clapping or anything, but I do appreciate you joining today, and welcome to this presentation on IC Group. We're in the business of scaling a consumer engagement platform. We do it at scale. What does that mean? What we know is that when large brands, large enterprises like PepsiCo, McDonald's, Microsoft, Kimberly-Clark, those types of organizations. Oh, perfect.
Thank you. Those types of organizations, when they engage their audiences, they drive more product sales, they build longer-term value with their customers. They drive more market share, ultimately. Ultimately, we know that they are more valuable than those customers or those brands that don't do that effectively. That's really what we do for those types of organizations as well as professional sports teams in a number of different sports leagues.
The key for us is helping simplify that whole process for those brands. There's a lot of complexity when it comes to consumer engagement, whether it be regulatory, technology, data, privacy. There's a whole host of solutions that come together to make that magic happen.
That's what we do, is we simplify that process and we do it at scale. As we go through this, you'll get a better sense of who we do it for, how we do it, and how our business is growing. I'm going to show a quick video here first. IC Group is a consumer engagement company. We help companies build real relationships with the people they're trying to reach. Not attention, relationships. We do it through three business segments that work as one.
Companies spend billions getting in front of people. Almost none of it sticks. An ad is rented attention. The second it ends, the person is gone, and you know nothing about them. What every company actually wants is the opposite. A person who chose to hear from you and comes back. Nobody sells the whole path to get there. We do.
It starts with the prize. We enable a brand wants to offer something big enough that people stop and play. We insure it. A CAD 100,000 prize costs a brand a few thousand to offer because we manage the risk. That makes the offer possible.
Then we build the moment. A game on the big screen, 20 seconds on your phone, thousands of people playing at once. It is fun. When someone plays, they choose to tell the brand who they are. Over 100 teams across North America and Europe run our platform.
Then we keep the connection alive. We are the company in the middle that delivers messages to every phone in Canada. Your bank code, your gate change. That is the whole system.
A prize worth playing for.
A moment worth remembering.
A relationship that keeps going.
This isn't an idea. It's running. More than 100 professional teams, programs in over 30 countries, some of the biggest brands in the world, and more than 70% of what we earn already comes from outside Canada.
We're the only Canadian-owned company that connects directly to every carrier in the country. Financial institutions, healthcare, and government, they all need their data to stay home. We're the only ones that can promise that.
We are a Lloyd's of London Managing General Agent. That is the oldest insurance market in the world. They do not hand out that authority. You earn it over decades. A competitor cannot start tomorrow and have either one.
In February of 2025, two important things happened. We acquired Fannex, bringing live events into the picture and helping close the engagement loop. We went public. Together, they marked a new chapter for IC Group, helping brands move from getting attention to creating engagement, building relationships, and driving commerce. We are built to connect the whole journey.
The expensive part is already built. The next country is a decision. It is not a decade.
This company was built one client at a time, built through resilience, innovation, capability by capability, and through billions of consumer engagements. We are just getting started. The business itself, just in terms of giving you a bit of scope on the business. The last 12 months, we did about CAD 30 million in revenue. Our recurring revenue is about 68% of that.
We are very fortunate to work with some of the top brands in the world that push us every day to be innovative. We are delivering programs in over 30 different countries for some of our biggest customers and working with over 100 different sports teams across North America and Europe. Last year, we did over 2 billion consumer engagements, and that forces us to learn every day and be innovative every day and simplify our solutions every day.
We have revenue that really comes from three areas of our business. One is what we call IC Engage, and that's really where our promotions, our loyalty, our fan engagement occurs, and that's all about taking audiences and converting them into customers. The next piece is our mobile business, and that's really about messaging, about reaching every consumer in Canada and North America, and being able to deliver instantly to the handset messages that are critical.
Whether it be transactional-related messaging or marketing-related messaging. Then finally, the last division is our insurance division, which obviously is a smaller segment, but it's a unique piece of the pie, which really manages the risk that sits in behind all these solutions that we bring to the table. How we think about it, IC Engage is really about turning audiences into active customers. It's that conversion point.
It's getting them to buy. It's that last mile. It's critically important. The next is mobile, as I mentioned. It's about reaching every consumer message by message. I'll get into a little bit further, but we're a Tier 1 aggregator in Canada, and we deliver somewhere between 1.5 billion messages and 2 billion messages annually right now.
The last piece is we underwrite the offers that really drive that conversion from that consumer engagement, whether it be in live events or it be with big brands that are trying to drive conversion with their customers. Where we operate is in the bottom of the funnel. We take audiences that are typically awareness, consideration, and in our perspective, that's where ad tech lives.
We're in the bottom of that funnel, helping convert those audiences into customers in that last critical mile by providing rewards, incentives, and promotions that help drive that conversion, as well as help build the retention and the loyalty with those consumers over the course of time. Because what that does is it drives reoccurring revenue for the brands that we work with and it increases their value.
Ultimately, we're really focused in on that monetization phase, working with customers and consumers over the lifespan of those consumers. We have a small but powerful team. Our business itself, we have about 70 employees, some based in Toronto, a large number in Winnipeg, Manitoba, some into the U.S., and out on the East Coast as well. Recently, we just made a recent announcement.
We did a repositioning of some of our leadership team, which results in fourth quarter restructuring charge of about CAD 1 million, as well as annualized savings of about CAD 900,000 a year. It really just helps simplify our business and positions us for some focused growth going forward. In terms of our business, this cap table, the Directors, Officers, and Executives are really focused on the business.
In terms that we own 53%, are very much aligned to the other shareholders and the value that we're trying to drive in the business. Myself, personally, I have about 28%-29% of that, myself and my family. So I can tell you, I'm very motivated. I have three boys, and I'm very motivated for us to be successful. We also have other insiders. That was a group that helped us when we did a management buyout in 2015.
They supported that initiative. We have employees and retail investors. We do have some debt. Our debt is about CAD 8.5 million. It consists of three things. First is a mortgage. We have a very small mortgage on a building that we acquired prior to COVID, before going public, which is about CAD 1.5 million. We have about CAD 5.5 million when we acquired a mobile messaging business in Canada.
The remainder is shareholder debt that happened when we acquired the Fannex live engagement platform in 2025. That debt sits with the True North Sports & Entertainment Group, which is the Thomson and the Chipman Group. They are currently shareholders of our business and have invested in the rounds that we have done. This gives you a good sense of the market that we play in. It is a strong market.
It grows at 20% annually right now. In North America, it represents about 34%. We have some strong tailwinds behind us. It is kind of that end of that third-party data shift to measurable outcomes. These are things that we do every day for the brands that we work with and the customers we work with. Mobile first. My observation, I rode the GO Train down today, and everyone had their head down, was into their mobile device.
Mobile first is becoming increasingly important, and that is why we made that acquisition as a mobile aggregator in Canada. It positions us really well to leverage some of the tools and some of the networks that we built there. Obviously, into live sports and entertainment space. It continues to grow. There is a lot of investment in this space.
We know that teams that understand their fan audiences really well and connect with their customers in that space are valued way more than teams that do not. What we are seeing now is you see a lot of investment going into fan engagement, into engaging consumers on a regular basis, both inside the arena as well as outside the arenas. Data security and privacy. These are areas that should be table stakes for a lot of organizations, but it is not.
This is something we are very good at. We are an ISO 27001 certified company. We focus on making sure that our data is secure, privacy perspective. Because we are operating in 30 different countries, we have a lot of different regulations we need to keep track of and manage.
We do that to ensure the brands we work with trust us and understand that we are really focused on protecting their brand integrity. Q2, we had strong growth. It continues to scale. We had 26% revenue growth in Q2. 97% of that was organic-driven. You also see on our adjusted EBITDA line that we are starting to move to positive EBITDA. This is starting to normalize. We went public in Q1 of 2025, so we are making some good progress there.
We continue to pay down the debt and strengthen that balance sheet. The way we think about our business is in three buckets right now. 2024, 2025 was about bringing everything together, getting some proof points on our business in terms of our customers and getting market validation and taking it public, as I said, in Q1 of 2025. We had significant growth in that year.
We achieved over 50% growth over the previous year, and that was on the backs of 68% recurring revenue, which is very strong. 2026 for us is starting to scale, again, organically and profitably. We are doing some things to really improve some of our profits in some of the different segments that we work in. That is starting to appear in terms of positive operating leverage. Then 2027 beyond is continuing to scale that organically.
We do see opportunities for M&A activity, but that is not our primary focus. Our primary focus is organic growth, and that is upside for us if we can find businesses that are accretive to our business. This is our Engage business line. You can see the types of customers we are working with are all large brands, leagues that we work with.
Microsoft, for example, we have been working with for over 10 years. Last year, I think it was in June, we announced that we had an extension for another five years out to 2030. We work campaigns in 30 different countries with them. We are deeply embedded into their Xbox, Microsoft Bing, which is their search, Microsoft Store, their social channels.
These are all channels in which we engage their consumer audiences to help convert them into customers and improve their data view on their different consumers that they work with. On the right-hand side, you can see some of the sports teams we work with. The Blue Jays, if you are ever down at Rogers Centre, you will see up on the big screen ways to engage through QR codes and participate through your mobile device.
Those are all mechanisms to get consumers to move from audience to actually buying customers, capturing their data through proper opt-ins, and moving them into marketing as well as commerce channels. Three really quick examples. On the left-hand side, one of our big customers is X, formerly Twitter. We have been with X now, actually, for probably 12, 13 years, we have been going on.
We have platforms that are embedded within the X ecosystem, and those platforms are used by big brands, big global brands, to promote and engage those consumer audiences that live within the social environment of X. And the whole intention is to put up promotions, incentives, and rewards to drive them into their channels and convert them into customers. This is an example of DraftKings that leveraged that platform.
The one in the middle is the customer ecosystem, Microsoft, which I spoke about. This campaign ran in seven different jurisdictions. We recently ran one that ran in 29 different jurisdictions. So you can think of regulatory compliance, data security, technology, languages, culture, delivering prizes in all those different jurisdictions, delivering incentives in those different jurisdictions. It is not easy.
It is complex, and that is our role is to simplify it and make it easy for the brands so they can deliver this at scale, reaching millions and millions of consumers. And the last one on the right-hand side is Hockey Canada. We do work with Hockey Canada. They use our live fan engagement platform whenever they run the World Juniors, over the Christmas break. This one happened to be in Ottawa, I think it was two years ago.
When it is in Canada, it is leveraged to engage the consumer audiences and drive them into marketing and commerce channels. The way I view this business, it is a really strong, profitable business. It has good margins. It is very much tech-enabled. It is highly efficient. It continues to scale. Our opportunity is how do we scale this faster? Those are some of the things we are working on.
We have done some new partnerships, which we announced in, I think it was in June, with a large U.S. technology company to embed our Fannex fan engagement solutions in their technology. They are currently embedded in local arenas, and arenas around the world in terms of their technology solution for digital displays. So, our solution goes hand in hand with digital displays and engaging fan audiences. Our next segment is our mobile messaging segment. This is a really unique asset for us.
We bought this in 2023, the end of 2023, and that business, we are a Tier 1 aggregator. We have direct connectivity to every carrier in Canada. Any enterprise level customer that wants to deliver messaging through to an end consumer has to go through a Tier 1 aggregator. As I said, we are one of three. We are the only Canadian one that is Canadian-owned and processes all our data in Canada.
So we have data sovereignty when it comes to regulated industries, so financials, banks, governments, those types of organizations. So we earn money on every transaction that goes through our system. You can see the types of customers that run traffic through our system. We have wholesales like Twilio of the world, which are very large communications companies, and others like Interac, who is a direct customer of ours and runs traffic through our platform.
Typically, the types of messaging are security authentication, notifications at scale, or marketing and promotional messages. Currently, 99% of our traffic is SMS. Our goal is we just announced that we integrated Bullet Messaging, which now enables us to do MMS, SMS, toll-free, WhatsApp, Apple Business Messaging. These are all new channels that we now can offer out to our customers, which will help us drive some margin and scale. So this business is a scaling business. Where we need to continue to work and focus right now is on our margin.
That is an area that we are focused in. Historically, that margin is around 20%. Right now, we are going through a transition. We are operating on two platforms right now. In Q4, one of those platforms disappears, so we will get some operational efficiencies, and you will start to see that margin come back up again.
The last piece is our insurance business. We are a Lloyd's MGA. We have binding authority in global jurisdictions. What this enables us to do is help manage all the risks that sits behind all of these different programs that we run, whether it be a live event, for example, event cancellation insurance, event liability insurance, or whether it be a large prize pool.
An example of one that is in the market today, we are not insuring it today, but one that is in the market would be McDonald's Monopoly. In the past, we used to underwrite those types of large-scale promotional opportunities. We continue to do that in various jurisdictions around the globe. So the way we make money in this space is we make money by our gross written premium that we get. We get commissions off that.
We also get a profit commission based on how well we underwrite our book of business. These are the types of programs we run, live event coverage, liability, which is more of a reoccurring product. You will see in our space, we have a very low reoccurring revenue in this segment of our business. It is about 10%. Our goal is to accelerate that, and this liability product line will help us do that because that becomes an annual reoccurring event.
Then we do, as I say, performance incentives and promotional prizing. The business here is a smaller piece of the business, but it is still healthy. It has got a strong gross margin, and it continues to scale and grow well. With the new product lines, we are starting to see some significant growth and liability, which is pretty powerful for us.
This gives us a good sense of when we look at our competitive landscape. We have got some really unique tools in the drawer and very powerful assets that differentiates us. Our experience, our ability to deliver in 30 different countries right now, that continues to grow. We scale every year. We add a few more countries to it. We are working with over 100 + different teams. We start to create a live event network effect.
We did a trial in March of this year where we have one brand was able to execute across 15 different sporting arenas and targeted over 80- 90 different games during that time frame, executing on one platform. They did not have to go to each arena and create a licensing agreement with each of those different arenas or each of those different teams. They were able to do it through our platform.
This is where we get some scaling effect opportunity for us. Obviously, I mentioned our carrier access and our one of three as a Canadian aggregator. That is a very powerful position, and our Lloyd's MGA status is something unique and different. When we are out pitching to customers, it gives us a unique twist to our solution, and becomes very powerful.
Just kind of winding up. Three things are important to us is the insider alignment. We have three ways to sell to our customers right now, and we have a strong reoccurring revenue base, which just gives us really strong visibility into coming quarters and a good base to grow from. I am going to stop there, and are there any questions? Yes.
The nature of your reoccurring revenue, I guess most of it is in messaging.
Yeah, it's a great question. Across the three segments, messaging would be about the highest, would be about 95%. Our Engage segment was about 50%, and our Insurance segment is about 10%.
What's the nature of your current contracts? Is there any customer concentration in the recurrence business?
Yeah. Across the business, we do have some large customers. There's probably about 10 large customers, that 80/20 rule. And they're long-term contracts. They're typically three years or more. Our tenure is 7+ years with all our customers. Microsoft, we're on 15, going up to 20 years. X, up to 12- 15 years. So they're long-term contracts.
There's nothing in their contracts, however, to be transparent, there's nothing in our contracts says if they cancel the contract, they owe us a bunch of money. It's all based on activity that happens throughout those contract periods. Does that help?
Yeah. Yes.
Just to continue with that, what are these agreements? Are these providing bulk messaging services for a fixed fee and then if you go above a number of messages, there's a variable?
On the messaging side, it's a per transactional fee, and based on certain levels or volume levels, you'll get some pricing discounts in some of those scenarios. On our Engage side, we have SaaS agreements with all of our teams. So those are on three-year license agreements typically. So those are reoccurring revenue streams. We also do a lot of promotional, or sorry, professional services that lay over top of that in those different jurisdictions.
We also have, because of the rewards incentives we do, last year we did about 50 million in rewards and incentives. That doesn't sit on our books in terms of revenue. What we do get, though, is we do get some commissions or some rebates based on the volume of buying that we do. So that piece of revenue would fall within our revenue streams.
Sorry.
Yeah.
There was a lot there. Back to the telecom.
Yes.
The nature of the revenues, it sounds like the customer engagement is recurring in nature.
Not necessarily the revenue, because if it's per transaction, then they're paying for 10 fees, right?
It's a three-year, like three-year agreements, and those transactions happen monthly, and you actually get a continual increase every month. Typically, that business grows kind of 4%-7% organically without us touching anything. Just because of the volume, more apps being used, more consumers using their phones. That just sort of grows naturally on that side. Yes?
You engage product by providing business process, maybe to process payments. What kind of people and resources need to deliver typically?
Yes. Our platforms are very tech-enabled platforms. We have a lot of technology resources in-house, like delivery, quality control, operational resources. That is kind of the expense part. It is mostly labor on that side. They are highly, as I say, they are highly operational and efficient. All good?
Sorry to interrupt. This is our last question. Please, this mic is for me.
Okay. Thank you. Last question. Sorry.
Typically on the Engage side, what is the typical engagement in terms of dollar value and what is recurring and what is varied?
Yes. On our enterprise customers, it is probably CAD 500,000 and up. On our teams, it is CAD 30,000- CAD 100,000.
Right.
Yes. Our goal is to kind of stretch that.
Okay.
Thank you very much.