Nvni Group Limited (NVNI) Conference Transcript

Summary of NuVini Group Limited (NVNI) Conference Call - May 22, 2025 Company Overview - Company: NuVini Group Limited (NVNI) - Industry: Software as a Service (SaaS) in Latin America, specifically Brazil - Business Model: Acquires profitable, cash-generating B2B SaaS companies, focusing on niche markets similar to Constellation Software's approach [2][8][12] Core Insights and Arguments - Market Position: NuVini is positioned as a unique M&A platform in the Latin American SaaS market, which is currently valued at $9.2 billion and expected to double by 2030 [12][13] - **Growth Metrics**: - Organic growth of approximately 14% last year - EBITDA margin at 26% with a 30% growth in EBITDA [11][20] - 20,000 customers with no single customer contributing more than 0.25% of revenue [10][22] - **Acquisition Strategy**: - Focus on established, profitable companies rather than startups - Targeting companies with annual revenues between 10 to 30 million reais (approximately$ 2 to $6 million) [30] - Current acquisition multiples range from 4 to 6 times EBITDA [43] - Financial Performance: - Achieved first operating profit recently - Adjusted EBITDA increased by 30% [20][37] - 72% conversion ratio from EBITDA to cash, indicating strong cash flow generation [37] Industry Dynamics - Market Growth: The Latin American SaaS market is growing faster than the global average due to being underserved, with significant opportunities for companies transitioning from traditional methods (e.g., Excel) to SaaS solutions [13][14] - Economic Environment: - High interest rates in Brazil (14.5%) are creating a lack of liquidity and a unique acquisition environment, as no IPOs have occurred since 2021 [26][27] - The current economic climate is seen as an opportunity for NuVini to acquire companies at favorable terms [59] Additional Important Points - Management Team: The management team has extensive experience in tech and investments, enhancing the company's ability to execute its strategy [38][39] - Investor Value Proposition: NuVini offers investors access to a diversified portfolio of profitable SaaS companies in Latin America, emphasizing predictable revenue streams [20][22] - Future Reporting Plans: The company plans to transition from annual to quarterly reporting to enhance transparency and visibility for investors [48] - Market Perception: The company believes it is undervalued compared to peers due to a lack of visibility and understanding of its business model as a capital allocator rather than a traditional software company [65][66] Conclusion NuVini Group Limited is strategically positioned to capitalize on the growing SaaS market in Latin America through a disciplined acquisition strategy, strong financial performance, and a focus on creating value for both investors and acquired companies. The current economic environment presents unique opportunities for growth and expansion.