I'm Aziz Rahimtoola. I'm the CEO and founder of Sabio. With me is our EVP of finance, Sam Wang, and making sure I'm keeping myself honest with numbers here. Then, of course, the disclaimers for our friends who are lawyers. Thank you. I'm going to play a little video, explain what we do.
The world of TV advertising is complicated. Not too long ago, there were only a few television channels people could watch. Running ads were simple because brands knew where to find the eyeballs. But now, traditional TV is becoming a thing of the past, and as people continue to cut the cord, brands know that streaming television and streaming apps are the future, but there are countless streaming apps people can watch, and on more devices than ever before. This makes it hard for brands to connect with the right audiences on the right devices, on the right streaming apps. Sabio makes this easier. We built a completely unique analytics platform based on audience viewing behavior on mobile devices and streaming TV devices. Brands use this platform to better understand where their target audience is watching content.
This doesn't just help them find eyeballs, but allows brands to advertise to people who would actually want their product. So how does Sabio make money? When a brand pays Sabio to run advertising campaigns, some of those funds are used to run the ads, and Sabio keeps the rest as profit. Sabio helps brands understand their consumers, run effective advertising campaigns, and make the complicated world of advertising simple.
So basically, to sum that up, what we do is we work with brands and agencies, and the agencies represent them, to run ad-supported streaming ads. And why that's important is it's an emerging market. Now, if you can imagine, no one's waking up in the morning and saying, "Hey, I really like my cable bill. I really want cable." No, that's not happening. What's happening is people, especially I have an eight-year-old daughter. Many of you might have kids, or you might have younger people in the house. Anyone under the age of 23 doesn't even know what NBC is, in most of the case. They don't know what most of the channel networks are. And so what they do know is they know YouTube, they know Hulu, they know Tubi, they know a lot of these other streaming apps. And that's really what we're capitalizing on.
And then you add to it the diverse nature of the U.S. today. More than 50, almost 50% of Gen Z is diverse. And so that creates another opportunity: a fragmented media marketplace and then opportunity to that. And so we have a strong footprint across the U.S., 55 million validated households. You need access to diverse audiences and a recurring business model. That's recurring business model. That basically means the ability to, you know, the first half of last year, we had 91% of those same advertisers return with us the first half of this year, with 120% revenue growth since 2021. So we're really hitting on all gears, and we're providing, delivering adjusted EBITDA profitability. And Sam, make sure we do that. We have a great team, key people, leadership, experience that dates back. My own experience was Fox, NBC, AT&T. Sam and I worked together at Opera.
Sabio Premji, our CFO, is a TD Securities guy. And so the combination of all this, and same with Jason Tong, worked with me at Opera. So we have a lot of great deep understanding of space and technology understanding. And it's a massive market, right? The streaming opportunity is big. We're talking about $45 billion and growing. So it's going to continue growing. Cord cutting is going to increase, and the opportunity continues to grow, especially for small companies like ourselves. And really what's happening too, as I mentioned, is the diverse nature of the U.S. ecosystem continues to become more and more diverse. And brands are trying to identify how do you reach those audiences more effectively and validate that. And so that's really what we're about. We're about not only helping them reach the audiences, but validate the fact that they are effectively reaching them.
How do we do that? So I was born in India, came to the U.S. at five. I live here in Los Angeles, actually a few exits away. And Sam has, you were born here, right, Sam?
Yeah.
Oh, sorry.
Right.
Didn't you learn anything every day? Anyways. You know, what we have never been effectively reflected in the media ecosystem. Most consumers under the age of 25 don't feel like they have. Nielsen doesn't do a great job. They have a 40,000 panel that really creates that represents billions and billions of dollars. We, on the other hand, have a 55 million panel. How this works is we have 280 million mobile devices that flow through our system every month. We cross-reference it with 110 CTV devices. These are all devices that are TVs, right? So we come at 55 million households. Why that's important is this: the phone was the first computer Hispanic consumers have, the first consumer Black consumers have, the first consumers Asian consumers have, especially the younger consumers. That's why it's important.
Because our data helps us more granularly understand that consumer place, marketplace, and helps the brands reach them effectively and validate those audiences. And so we take this data, and then we run ads on some of those platforms and those apps on behalf of the brands and agencies we represent. Here's an example of some of the brands and agencies. And, you know, the question I get asked is, how does a small company your size work with some of the biggest brands in the world? Because we're solving a problem. We're solving the issue that no one else is dealing with effectively. And we've been on this mission. I forgot to mention, when I started the company, I named it Sabio. Sabio means wise or intelligent in Spanish.
When I started the company 10 years ago, the U.S. population for Hispanics and diverse nature was roughly around 20%. Today, once again, half of all Gen Z is diverse. These brands need to deal with that and adjust accordingly. Example being, and you could actually Google a press release we did with McDonald's. McDonald's is faced with a challenge. There are challenges I have to reach Gen Z consumers who are 12-24. How do I do that? We help them reach their multicultural audiences on mobile apps and streaming apps. Why we win? We've built our own end-to-end solution. We validate footprint, which really authenticates who these people are and these households, diverse understanding, and then finally delivering strong results.
Because once again, you can't have a 91% recurring revenue model with brands as big as we work with without the ability to execute and do it consistently. Business execution, I'm going to hand it over to Sam.
Thanks, Aziz. Before we dive into the numbers, I would like to take a step back and reflect on how far we've come since going public. As some of you in this audience might remember, we made debut on a Canadian exchange about three years ago, and back then, we raised about $8 million, a very modest amount comparing with our public peers here. Through the laser-focused execution and also, you know, the strategic deployment of that capital, we emerged as one of the fastest-growing independent ad tech companies in the OTT and CTV space, as you can see from those kind of amazing growth numbers on this slide. Now, so I wanted to talk about, you know, how our business model thrives in both election cycle and the non-election cycles.
On the left, as you can see, in the non-election years, our growth was really powered by the branded core business, right, led by the major customers such as McDonald's, AT&T, GMs, and they were able to help us deliver this consistent 37% kicker. Now, that growth rate is even more pronounced when, you know, we are in this election cycle, thanks to our unique ability to target the diverse audiences. As Aziz mentioned earlier, you know, there is, you know, definitely a renewed appreciation for how important that ability is within our political clients over the last few years. Now, turning to our most recent performance, we announced our Q2 results a couple of months ago. We grew the revenue by 11% on the top line. But the CTV OTT was really the primary growth driver.
So if you look at the numbers we deliver in Q2, we grew the business by almost 40%. And the industry was growing about, you know, 15%-16%. So that basically means we are not only riding the wave, we're actually taking the market share from someone in the space. Now, Aziz talked about, you know, 91% recurring revenue rate, which is certainly very impressive. But what is even more compelling is that 70% of the top brands who did business with us last year actually came back with more spending on a year-over-year basis this year. Now, CTV OTT, as I mentioned earlier, you know, is a primary growth driver. So as of Q2, 77% of the revenue we have came from the OTT and the CTV.
And if you kind of go back in time, you know, three or four years before we won the IPO, so that percentage was only 8%. So that's a remarkable transformation of our business model and the sales mix. And last but not least, 20% of the brands we onboarded in the first half of this year were actually the new brands that had never done business with us in the past. So if you put this together, you know, with the 70% expansion of the deal size of those existing customers, that created a very compelling opportunity for us to expand the share of the wallet for our customers for the quarters to come. Now, you know, I definitely sound very excited about our top-line growth, but we are also very proud about the bottom-line transformation we had over the last few quarters.
So we definitely know how to run a profitable business. You know, as some of you might remember, we delivered a positive EBITDA for three consecutive years going back to 2020, 2021, also 2022. So we hit a bit of a speed bump last year in 2023, I mean, in part due to some of the microeconomic headwinds like UAW strike and the, you know, writers' strike. So we took those, you know, we turned those challenges into opportunity to really start to streamline our cost structure. So we implemented almost a $4 million worth of annualized cost saving back in Q3 last year. And that result and impact is pretty evident, you know, in the first half result in this year. So we were able to basically improve our EBITDA by $2.4 million on a year-over-year basis in the first half of this year.
As some of you might have seen in our pre-release for Q3, we are going to grow the revenue by at least 75% with $60 million. We feel confident enough that the positive EBITDA we generate in Q3 is going to more than offset the $1.6 million EBITDA loss incurred in the first half. Now, I want to pause here and address a key question on investors' mind. Some people might be asking, you know, hey, this year is a political year. You know, you guys are doing great. What is the revenue outlook for 2025? Now, you know, if you unpack the first half number, what you will realize is that, you know, due to the last moment switch at the top of the ticket, you know, we did not really get much of the political spending at all in Q2.
So despite that, you know, our core business actually grew more than 20% on a year-over-year basis. And that momentum actually continued into Q3. So we are seeing strong double-digit growth on the core business alongside with the political and advocacy sales. So those, you know, those factors combined with the fact, you know, we have the new programmatic TV offering on the table, and now we have an optimized cost structure, you know, that's put us uniquely positioned, you know, for the future growth going into 2025. Let's see what's going on. Do you know how to? Yeah, it looks like it's frozen. Yeah.
It's not our attempt to just focus it on that slide.
Yeah, yeah. It's a good slide.
Oh, no.
Yeah.
There we go.
Interfering with that, so I want to do it.
Okay, try again.
Yeah, okay, I'll try again.
Yeah.
Yeah. Now, this is perhaps the most compelling aspect of the Sabio story I want to talk about today. It's the valuation. We believe there is a striking disconnect between the valuation we are getting on the public market and the business fundamentals. Let's put this into perspective. Our current market cap is about $18 million. If you look at the consensus revenue estimate for this year, it's about $47 million, close to $50 million, right? We are definitely trading at a steep discount on the sales basis. Now, you know, before we get into additional valuation metrics, it's also worth pointing out 60% of the company is currently owned by the insiders, right, like Aziz and the management team. Aziz himself actually owns 47% of the company at this point.
This substantial insider ownership creates a perfect alignment between the management and the investor like you guys, right? You know, we win when you win. You know, we are definitely very committed to the success of the Sabio story. As I talked about earlier, we are trading at a discount on the sales basis. I know there are investors out there who, you know, don't really care too much about the revenue growth. I mean, they care a lot about the profitability. If you look at this comparison against our public peers, I mean, we are trading at a discount on the EBITDA basis as well.
For those of you who are, you know, seeking to gain some exposure to the fastest-growing CTV and OTT channel in the marketing space, we believe the stock price we have right now offers a very compelling entry point, yeah, for the investors. With that, I'm going to hand it over to Aziz.
All right. Thank you, Sam. Thank you, Sam. And I'd like to, you know, the question comes up quite often, and I think it's important to address is, well, you talked about how your revenue is all U.S.-based, mainly U.S.-based. We have a little percentage now growing internationally. So why did you list in Canada? Why did you not just take VC round here in the U.S.? And why? The reason being is because when I looked at my options across the board, and at that time, we had a total coming out of COVID, we had $12.2 million EBITDA positive that year, despite COVID. We then had, you know, roughly $3.2 million of debt. And when I looked at my options here in the U.S., the VCs wanted a big chunk of the company to do it.
On the other hand, when I looked at the opportunity that the Canadian market presented, we got a higher valuation. We said to that, we said to the investors who were still part of, a lot of them were still part of the story, some major institutional ones, that, look, when we get this $8.2 million, we're going to transform this company. We're going to take it from a mobile display company because we see the opportunities ad-supported streaming has. Today, more than 70, 77% of our revenue comes from ad-supported streaming. That allowed us to do that. Look, we are still a U.S.-based company. We still, you know, we do have this public trading stock in Canada. We find it advantageous.
And I think it also does create, as Sam points out, the disconnect because sometimes public markets in Canada operate a little differently. They don't necessarily understand ad tech, which is fine. Because at the end of the day, what we're focusing on is executing on the business fundamentals and making sure the company continues to be profitable and growing. And that is really our objective. So on that note, I'll take some questions. Oh, sorry.
A couple more slides.
Oh, a couple more slides. Oh, sorry. We, yeah. And then we have, despite the, you know, and the importance of having a great board, especially when you have such high inside ownership, is critical. So on our board, Paula Madison was the former owner of the L.A. Sparks basketball team, head of, you know, a senior person at NBCUniversal and was a GE officer. Carl Farrell was a chief, former chief revenue officer of the SAS Institute. Moz Kiraj had just recently switched companies, but he was, he is now, right, he's now managing director of Kascade Digital, which is out here. It's a capital firm. Gonzalo Del Fa is the president of GroupM Multicultural. This is the largest holding group in the world.
And then finally, Matt Hoehl, who just recently joined our board, is the Chief Data Analytics Officer for Chamberlain Group, which is a company that Blackstone Group purchased for $5 billion. So, you know, we got an amazing board that really helps us continue our trajectory and keeps us on point. And then finally, the investment summary. We have unique value proposition, high growth, and profitable business. And then finally, landscape and opportunity is great. As I mentioned, between $43 and $44 billion is going to be spent in streaming the next couple of years, and we're going to take advantage of it. Great. On that note, happy to take some questions.
Sure. Given the last two years in the U.S., both commercial and television industries with the SAG strike, the DGA strike, and also given the fact that many different companies' production, also distributors, are leaving the United States and North America as a whole, how is Sajid adjusting to somewhat of a fluid situation in that workforce? And I mean, if you could speak to it and what you guys have done on the ground for what's called the last 18 months.
Actually, there's a product we're working on. We're going to be launching a streaming channel called Creator TV. Creator TV is utilizing the new business model, which is creators, influencers in the social media space. We already have distribution on two networks. We're having conversations with another. I mean, when I say, sorry, these are streaming channels and platforms that we have finalized distribution on. Where we see the opportunity is fundamentally, and I had a production company years ago, about 10 years ago, one of the first companies I founded was a production company. The fundamentals of that business continue to change. There's no going back because viewership continues to dive for the traditional TV market and movie markets. So what the new industry opportunity is the creator economy. That's what we're capitalizing on.
As we are not going into the production game, but what we're doing is we are leveraging creators and bringing them into streaming TV. And we see that as the future of the dynamics. I mean, just here in L.A., for example, TikTok is doing a lot of business in production and creators. You know, Meta, Facebook out here. And we believe we can play in this space. And our clients are eager for it. And the creators we're talking to are eager to diversify their business model as well. So great question. Hope that answered it.
No, you did.
Cool.
I knew you.
Awesome. All right.
Are a lot of your competitors also focusing on that multicultural space?
The question is, are a lot of our competitors focusing on multicultural space? They weren't initially. I will tell you, they are starting to take notice, and they still lack a deep understanding, and they still have a lot of catching up to do. The benefit we had is we started this with the focus in 2015. We have data, and everyone talks about AI. But the key premise of AI is the data and the machine learning components that you put behind it. We've been doing this since 2016, so while competitors will enter the space, and they will certainly do their best to go after a diverse market, we have quietly started becoming the leader, de facto leader, not only for running campaigns, for the insights connected to diverse audiences, and we continue to grow that momentum.
So certainly, there's going to be a lot of people jumping in and going after that marketplace. But we're the only ones with the kind of tech, end-to-end tech in the space today that's in that area. You have a lot of bigger players who do everything. We're the only ones that are like positioning ourselves really well in that. Sure.
Next question.
Sure.
Based on the current trends now, North America versus, like, let's say, South America, Latin America as a whole, do you see Sabio planting a bigger flag in comparison, let's just say, to your competitors into the Spanish-based market, say, into the Spanish-speaking market? And how are you looking to kind of open? Because that's the next major that is the major market. That's the next major market.
The question is, you know, is Sajid going to plan a deeper existence in the Spanish-speaking market? I will tell you that from my own experience, I was born in India, came here when I was five. The context of predominant Spanish-speaking or Indian-speaking or any other language speaking is kind of going away. The idea is, while they will continue to hold on to their language and identities, that this idea of multiculturalism, and it is the idea of full market, there are more biracial families now than in the history of this country. That will continue to progress. And so while we believe that we can reach, it's not about, you know, when we reach diverse audiences, we're reaching them with a mindset of understanding who they are, not necessarily targeting them based off of like, simply that they're diverse.
It's the mindset that we're trying to get to. So their apps, their location, and nuances of their culture allow us and that brand to reach them more effectively.
Question.
Do you have to find specific FAST channels or content via FAST channels to then suggest directly to the brand to place the ads? Or are you giving them a sweep to go to the ad marketplace themselves with your analytics?
`Yeah, the latter. The question is, are we identifying, providing data to the brands for them to go target, or are we ourselves doing that and providing them a platform in which they can go and reach that? Today, most of our campaigns are done through us. So they come to us. We then run the campaigns. But what we're doing is we are, there's new products we're launching, which allows them to do it themselves, and we will provide the insights and the data to go out within that ecosystem and identify and reach those people.
Is your FAST channel going to reach a platform or a single TV channel?
It's going to be on an existing platform, and so it'll be a single channel on that platform. So.
TV, video, really few.
Plex, for example. Plex, it'll be a channel, Creator TV channel on Plex. We're having conversations with Roku, Vizio, and Samsung and LG, and everyone's interested in it. Because the idea is we, having been in the production game, I recognize the challenges that I face. I also recognize the challenges I face with distribution. So what we're solving for there is here is great content that needs to be fine-tuned for the bigger screen, which we're helping assist in that, but then providing the insights, analytics, and the know-how of modernization.
And so not developing your own CTV app?
So there is a long-term plan. The idea is first, you know, we're smart enough to know building an app is the easy part. Getting people to download it is the hard part. And so that's nation-building. And so what we want to do is give people exposure to the CTV channels, the apps on these channels, because they already have built-in viewership. As we get following and we fine-tune that business model, we could then launch our own app.
If you see some creators, they've got the following.
That's exactly right. That's exactly right. And the business model is you can't compete with Google, Facebook, and Instagram when they get content for free. Going back to that question, you can't compete on any business model unless you figure out how to leverage that same kind of thinking. So it's not, you can't, if you're not going to beat them, you better imitate them. And that's kind of what we're doing.
Thank you. That's all the time we have.
Okay. Thank you.