@Tezzdog thanks for putting this one on the community radar screen. Its also nice to have a new company to screen on my first days back after holiday. So, here is the fruit of 60-minutes' quick research ... so, maybe I've not got everything quite right in what follows.

Clearly, its SP progression in the last year has been amazing, up over 200% CYTD and - if you'd timed it right in the last 16 months, you'd be sitting on a 10-bagger!

The recent track record of strong revenue growth with good gross margins (c 60%) and expense control is impressive, and so getting to positive FCF (at it is still at tiny scale) is a great achievement, made possible by a capital light business model. From a quick look at the accounts and annual report it looks like their are two elements to the business model (which are not unusual in this space):

• Performing R&D via a partnership network, including various universities - avoids some of the fixed costs of a large R&D capability
• Outsourced manufacturing

This is, I think, a model we have seen elsewhere, making the business an interesting hybrid between a fast-moving consumer brand company and a biotech.

Clearly, with a Cap/Rev = 11, $BIO is not cheap. So, the question is - can they continue to scale at 70-80% revenue growth p.a., while controlling expenses?

They've proven their business model in Australia, and are now going global with marketing entry in the UK and Canada and with EU and potenitally USA also on the horizon.

Probiotics Market

Depending on how you measure it, the global probiotics market is already huge: anywhere from US$50-$75bn, and forecast to grow annually at 7%-9%. There is a lot of scientific research going on to better understand the relationships between gut health and wider human health. So, there are strong macro-tailwinds behind this business.

However, there are also a lot of established players in probiotics, including some ofthe world's largest consumer companies. Just look at some of the names in the list below.

Even Probi - a Swedish specialist, has a market cap of c. A$0.5bn and snnual sales of c. A$0.1bn.

$BIO's Position

If you go on to any pharmacy website, there are a lot of brands competing for space. While $BIO have achieved a toehold in the Australian market, with 4000 outlet points (there are c. 6,000 comunity pharmacies in Australia) and several large agreements with major chains, a key question is whether they can replicate this success in the global roll-out they'v started.

I have no idea how good the clinical evidence is behind their product portfolio, compared with other offerings in the market. A core part of their marketing strategy is educating nutritionists, pharmacists etc. Education will clearly need to be part of their global marketing strategy, so a key question is, how well can they do this internationally?

Cash Position

While having achieved cash flow positivity, a global roll-out will require building out their sales and marketing presence and supply chain. That's going to require an expanded expense base and working capital. Brand-building will be required in each local market, so they'll need to repeat what they've done in Australia.

With $2m in the bank, given that they are rolling out on so many fronts, I imagine a capital raising will be inevitable. And with such a strong share price, now would be a good time for them to do it. How much? Well, I'd expect them to go for at least $20m, which give their market cap today of $135m; so that's not such a bad dilution, and would help them set up the teams needed in the EU and North America.

They've indicated saying something about the US market in FY25, so I think such an announcement would be wrapped up with a capital raising.

Board and Management

The CEO looks like an interesting guy. Background in fashion marketing, then moved into healthcare and founded $BIO in 2018.

The other Board members have experience in a range of entrepreneurial companies with the chairman focused in small IT businesses.

Gayle Fisher AM has some large cap board experience, but also mainly appears to have experience in the venture capital / entrepreneurial space.

So an orange flag for me is that the board lacks any experience in driving a global brand-building venture, and also lacks experience in healthcare and FMCG.

The concerns are increased when I look at the management team. For example, the Chief Scientist is a part-timer!

Conclusion

This business has done very well to get this far and become cash generative, with strong revenue growth. But it is a minnow playing in a dynamic, global market already occupied by some of the world's largest consumer goods corporations, and well as several much larger nutritional-specialists.

My big questions are:

1. How good is the product portfolio - as there needs to be some differentiation in a crowded space, where the big boys play?
2. Is this Board and Management Team capable of a successful global rollout?

10 x revenue is a lot to pay with these question marks.

However, if they can demonstrate product-market fit in a European market (UK being the first), then you'd have to believe that several years of 50-100% revenue growth becomes possible, and then all bets are off for the valuation.

So, this one is definitely on my watchlist. (In terms of timing, I might consider it in a SP pull-back that could well follow a capital raising, and with some more data on UK/EU sales progress, provided I can get comfortable with what I consider an insufficiently experienced board and management team. That's a major sticking point for me.)

Disc: not held