Net Element, Inc. (NASDAQ: NETE) is a technology-driven group specializing in mobile payments and value-added transactional services that add convenience to mobile phone users’ lives and everyday commerce. The company’s innovations enable consumers to conduct commerce transactions from their mobile device, while online and offline payment capabilities allow merchants to reliably transact business anywhere and anyhow.
The company owns and operates TOT Group, Inc., a global mobile payments and transaction processing provider. TOT Group companies include Unified Payments, which was recognized by Inc. Magazine as the No. 1 fastest growing private company in America in 2012; Aptito, a next-gen cloud-based point of sale (“POS”) payments platform; and TOT Money, a mobile billing solutions provider and Russia’s top-ranked SMS content provider, according to Beeline, the country’s second largest telecommunications operator.
Net Element has headquarters in Miami, Florida, with international presence in selected emerging markets. Utilizing its global development centers and high-level business relationships, Net Element has positioned itself for continued growth in the mobile commerce and alternative payments environments.
Key Investment Highlights
- Using proprietary technology to transform global mobile, online and offline commerce
Management team with extensive backgrounds in technology, payment processing, finance and marketing
Recently expanded board of directors contributes strong, additional guidance to company initiatives
Subsidiary portfolio of industry leading, top-ranked companies contributing to overall growth
Resilient business with strong recurring revenue, diversified customer base and good visibility
Family of Brands
Net Element is focused on creating and delivering innovative, end-to-end payment solutions to enable commerce around the world with focus on emerging markets. The company achieves this object in symphony with a strong family of companies that share a passion and vision of driving innovations that enable commerce.
TOT Group, Inc. is a multinational mobile payments and transaction processing holding company which provides a range of flexible online and offline payment solutions. Clients include mobile operators, content providers and merchants. TOT Group delivers comprehensive, end-to-end payment solutions to enable merchants to reliably accept cashless transactions at the point of sale ("POS"). From processing of electronic payments at the POS to processing mobile commerce transactions to managing merchant terminals and providing information management services, TOT Group offers innovative solutions which allow its merchants to streamline their payments resources.
TOTmoney.ru is a mobile payment gateway for Premium SMS and Mobile Commerce in emerging markets. The market is growing rapidly and Net Element is positioned to be a major player. As the mobile commerce market expands, the company will also be leveraging its development staff and IP to deploy advanced commerce applications.
Unified Payments has been recognized by Inc. Magazine as fastest growing private company in America for 2012 and is a leading socially responsible provider of payment processing services to small, medium, and large-size merchants across the United States.
Unified Payments provides comprehensive turnkey, payment-processing solutions to merchants across the United States. By utilizing the products and services offered by Unified Payments, merchants are able to accept both traditional card present and non-card present payments, as well as other forms of cashless payments such as prepaid cards, gift cards and other forms of non-cash payments.
Aptito is a next-generation, cloud-based payments platform, which creates an online consumer experience into offline commerce environments via tablet, mobile and all other cloud-connected devices. The solution is a tablet-based POS that combines traditional POS functionality with mobile ordering, payments, social media, intelligent offers, mobile applications, loyalty, and transactional data all-in-one solution; with Aptito's cloud-based payments platform at the center of it all.
Proprietary technology drives competitive advantage
Sales Central – Provides real-time comprehensive reporting on merchants and sales partners
TOT Platform – Omni-channel transactional platform and mobile payments billing system makes payment solutions possible across multiple channels and markets
Apito – Next-gen, patent pending payments platform creates an online consumer experience into offline commerce environments
Payment Browser – Unique Internet browser-based software platform that allows rapid integration of secure payment processing services into an existing web application
Broad and comprehensive suite of service offerings – able to accept payment from any device, anywhere
- Credit/Debit Acquiring
DataCapture & Analytics
- Reporting Tools
Customer Support Security & Risk Management
Market Opportunity & Strategy
Large and Growing Market with Favorable Economic Trends
Mobile Commerce Revolution: Internet commerce changed how we do business, and now the rapid expansion of mobile is morphing the retail environment again.
- $796 billion - global m-payments market by 2014
$1.792 trillion - global e-commerce market by 2014
58.5% annual growth of m-payments market
18.1% annual growth of e-commerce market
TOT Group’s next-gen, cloud-based payments platform creates an online consumer experience in offline commerce environments via tablet, mobile and all other cloud-connected devices. The solution is a tablet-based POS that combines traditional POS functionality with mobile ordering, payments, social media, intelligent offers, mobile applications, loyalty, and transactional data with the TOT Platform at the center of it all.
$195 Billion Opportunity in Emerging Markets
Net Element is also exploring immediate opportunities in CIS with prospects in Russia, Ukraine and Kazakhstan.
Sales and Marketing Strategy
For full-year 2013, Net Element recorded net revenues of $18.7 million, marking a significant increase above prior year revenues of $1.3 million, reflecting the partial year of operations of Unified Payments and a full year of operations of TOT Money in 2013.
Net Element has amassed the building blocks to deliver sustainable organic growth complemented by strategic acquisitions.
- Opportunity to acquire 50-70%
Immediate impact to bottom-line and future production
Indirect channel comprised of independent sales organizations and independent sales agents across the United States
Significant growth with ISO’s which signed up for production commitments to the company
Proven organic growth model for Unified Payments during three calendar years
Double digit year-over-year merchant growth
Various distribution channels provide positive merchant growth
Level 1 outsource
Centralized customer relationship management
Innovative partner programs were launched during past years, which directly attributed to distribution
Emerging technology roll-out includes: mobile payments, alternative payments and integrated solutions
Large & Growing Industry
- Large and growing market with favorable economic trends
The use of non-cash forms of payments including mobile payments has steadily increased over the past ten years and continues to climb
Recurring Revenue Business Model
- Focused on fast growing and highly profitable market segments
Proved transactional business in the United States with recurring revenues
Diverse, low-risk, recession proved recurring revenue stream
Strong established customer & partner base
Resilient Operating Leverage
- Resilient business with strong recurring revenue, diversified customer base and good visibility
Full front and back office operations including risk, underwriting, deployment, activation, client services, data entry and retention
Significant, untapped opportunities for expansion and growth
Proven Management Team
- Proven track record of scaling businesses and delivering shareholder value
Proven achievements in new product launch
Proven achievements in new market development and establishing market presence
Relentless focus on value creation and growth
Oleg Firer CEO & Director
- Award-winning entrepreneur and financial services executive
Co-founder of Unified Payments
Chief Legal Officer
- Seasoned legal executive
Member of the Massachusetts Bar Association
- CFO of NETE since March 2008
CPA with more than 25 years of experience
Chief Technology Officer
- Seasoned software developer
Expert in creating and implementing business and technology strategies that exceed company objectives
President, Merchant Services TOT Payments
- More than 15 years of experience in the payment industry
Co-founder of Unified Payments and Merchant Processing Services Corp.
- Experienced entrepreneur with track record in bringing products to emerging markets
Experience in e-wallet, acquiring and money redemption
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