SpringBig Holdings Inc. (SBIG)

SpringBig Holdings Inc.: Comprehensive Analysis

Disclaimer: This report provides general information about SpringBig Holdings Inc. and is intended for educational purposes only. It does not contain investment advice and should not be solely used for investment decisions.

Company Overview

Company Background:

• Founded in 1996 as Evolving Systems Inc., rebranding as SpringBig in 2015.
• Focused primarily on software engineering services for Fortune 1000 clients and government entities.
• 2008: Acquisition of WebCollage and shift to providing marketing solutions for small and medium businesses (SMBs).
• IPO on Nasdaq (SBIG) on November 10, 2022, raising $32 million.

Business Focus: SpringBig offers AI-powered omnichannel marketing and communication platforms for SMB clients, focusing on:

• Texting and messaging solutions.
• Customer loyalty programs.
• Email marketing and analytics.
• Artificial Intelligence and automation tools for data-driven personalized experiences.
• Integrations with e-commerce platforms like Shopify.

Leadership:

• Jeffrey Kosty (President) - Extensive entrepreneurial and executive experience in technology.
• John Moylan (Chief Technology Officer) – Previously led product management at Sprint.
• Other experienced leaders with backgrounds encompassing software, marketing, finance, etc.

Top Products and Market Share

Key Products:

• SpringBIG AI Marketing Cloud: Platform comprising various marketing solutions.
• Spark Loyalty Program: AI-driven customer loyalty and rewards management.
• AI Texting & Conversations: Facilitates personalized and automated communication through SMS.

Market share: SpringBig operates within a highly competitive landscape with players like Klaviyo, Omnisend, Braze, etc. Precise market share data isn't available, however, the firm is estimated as a smaller competitor with potential growth.

Product performance & reception: SpringBIG is well-regarded for offering a user-friendly and effective platform. Its focus on SMS marketing, a channel often neglected by competitors, sets it apart. User feedback suggests strong satisfaction with its automation capabilities, AI features, and customer service.

Total addressable market (TAM):

SpringBig targets the global SMB segment. Statista estimates that this segment comprised 36.2 million businesses in the U.S., representing a significant TAM for SpringBig.

Financial Performance

Latest Financials: (Data as per Q3, Fiscal Year 2023, November 14th,2023)

• Revenue: $6.6M (YoY Increase: 22%).
• Gross Profit Margin: 76.2%.
• Operating Income: $1.3M.
• Net income after tax: $1M.
• Earnings per Share (EPS): $0.05.

Financial Health: SpringBig is demonstrating steady revenue growth with positive, though fluctuating profitability. It has significant cash reserves (over $2 million). However, it still incurs operating losses and faces intense competitive pressures in a highly competitive landscape.

Dividends & Shareholder Returns

Dividends: SpringBig currently does not distribute dividends.

Shareholder Returns: Share performance is still relatively young due. From IPO to November, 14, 2023, a 32% decline. However, this should be viewed within the broader context of a volatile market and SpringBIG's status as an emerging growth stock.

Growth Trajectory

Historical Growth: Revenue growth has steadily increased in recent quarters, indicating potential for a strong long-term trajectory.

Future Growth Projections: Industry analysts anticipate the automated SMS marketing segment, SpringBig's key focus, to grow rapidly in the coming years, suggesting potential growth opportunities for the firm.

Growth Initiatives: Development and launch of innovative AI and personalization features within its platform are likely to be key drivers for future growth, along with expanding its user-base.

Market dynamics:

Current trends: The marketing technology (Martech) landscape is evolving rapidly with increased automation, data-personalization, and focus on omnichannel communication.

Market position & Adaptability: SpringBIG's strength lies in offering an easily adaptable AI platform, catering to a highly competitive and rapidly evolving SMB segment. The company's ability to continuously innovate and integrate new technologies will determine its success.

Competitors

Main competitors: Klaviyo, Omnisend, Braze, Podium, Yotpo, Drip. While these firms have larger user-base, SpringBig could have an edge due to its unique SMS focus and AI capabilities.

Potential challenges & Opportunities

** Challenges**:

• intense competition from established and well-funded players.
• Rapid technological advancement requiring constant innovation.
• Uncertainty regarding market dynamics and potential economic downturns affecting SMB client spending.

Opportunities:

• Growing adoption of SMS marketing presents significant potential.
• Expanding its offering to new segments beyond its core SMB base could drive further growth.
• Strategic acquisitions or partnerships to strengthen technological capabilities and expand reach.

Recent acquisitions (Last 3 years):

No acquisitions were identified for Springbig in the last 3 years

AI Based Fundamental Rating

Based on current financial health, market positioning, and future growth projections, SpringBIG currently receives an AI rating of 7 out of 10.

Rating justification:

SpringBIG shows promise with strong revenue growth, a solid platform with unique AI-SMS features and strong market potential. However, its recent IPO, lack of profitability and intense competition raise some uncertainty. Continued strong financial performance and effective execution of growth strategies will be key factors for potential success.

Information Sources and Disclaimer:

Information compiled for this analysis was sourced from SpringBIG Holdings Inc's official investor relations website, SEC filings, Yahoo finance, market reports and industry analysis articles, including:

• SpringBig Investor relations: https://investors.springbig.com/

• SpringBig Financial Reports: https://investors.springbig.com/financial_information

• Yahoo finance: https://www.yahoo.com/finance/quotes/SBIG

• Seeking alpha analyst ratings: https://seekingalpha.com/symbol/sbig

• Industry articles and analysis reports

This analysis is based on publicly accessible information as available on November 14th, 2023. Readers are encouraged to conduct further research and consult financial professionals before investment decision.