I attended the Ophir Meet the Managers event last night and they had a run down on their investment thesis in Life360.
The part I found interesting was they are selling it as it's making up too much of their portfolio. They also said it will run another 8 times... so a little conflicted with their comments.
I have 2 young kids and I don't like the idea of them knowing that I know where they are at all times. Trust with kids needs to be earnt and they need to be empowered to go down the road to the shops or whatever. I acknowledge there are cases where it is appropriate. It's a little different if you're lending your 17yr old your car when they're on their P plates and you want some piece of mind they're going to the right place and not being idiots on the road.
I won't be using the app on moral grounds, unless my kids turn out to be numbskulls...
Some of their summary from my notes:
- market expects MUA growth to slow, Ophir thinks the market is wrong. The adoption curve is still early in the global side.
- Subscription upside - Pets, Elderly, Driving behaviour. Life360 already know your data on where you go, what you do, if you have a pet, if you've been visiting your parents at the aged care home, etc. and then adding these upgrades to existing users is a slam dunk. Don't need to spend mega marketing money as they already know who you are!
- Advertising revenue - Highlighting Demand Side Platforms and the monetisation of the data. currently sits at $1.50 per MAU/year, Ophir thinks this will get to $5+. which equated to a $550 million EBITDA opportunity. Apparently this isn't priced in.
- They have raised $200m and expect strategic M&A.
Valuation wise, they are saying it could be an $800m USD revenue --> 30x EBITDA --> $24B AUD. currently $3-4B so 7-8x upside
