Fast growing small caps such as iSignthis Ltd (ASX: ISX) are often trying to disrupt the way a current process is done. While their method may well be better than current practise, there is no certainty it will be taken up by the targeted industry. Inertia is a very powerful force.
iSignthis Ltd ISX (ASX) first came to my attention when I read its latest quarterly cash flow report. As you can see below the large jump in revenue from previous quarters is the stand out feature. As I wrote here revenue growth is not the only thing to look for but it does highlight if the company’s product is gaining traction.
From the 4C, it appears that for the last month of the quarter, iSignthis may have actually been cashflow positive, a big achievement for any small cap.
Source: iSignthis 4C report
The question you must be asking yourself by now is what does iSignthis do, and why such a weird name?
To be honest the first time I heard its name I was a bit turned off, but it aptly describes what iSignthis does. Rather than me struggling to describe what they do I suggest watching their clip below.
Now that you understand what iSignthis does, lets take a look at its CEO and his background. This interview was done after iSignthis came onto the ASX back in 2015.
Conclusion
I won’t sugarcoat this, iSignthis operates in a very competitive market. Regtech is one of the fastest growing tech sectors and for a very good reason. When you think about how many transactions are processed around the world everyday, you can start to understand the prize on offer.
I have included a list here of regtech companies that you may like to investigate. While they do not all operate in the same space as iSignthis, it gives you an idea on the scope of the sector.
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Disclosure and warning.
Please Note: None of the above should be considered investment advice. These are my own opinions based on a number of years market experience. Please do your own research and consult a qualified financial advisor if you wish to invest.
At the time of publication Alonzo owned shares in iSighthis. Price at time of publication 15.5 cents.