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Soulgate Inc. (SGI) operates Soul app which is an algorithm-driven online social playground. The app is targeted at the younger generations audience (usually born after 1990s) and it aims to provide a virtual space for users (often referred to as Soulers, we will still use users for the sake of clearer terminology) to connect and build social relationships through virtual identities and multi-media content.
SGI has demonstrated breakneck revenue growth as it had only just started monetization in 2019. The company is exploring various avenues for revenue generation and advertising services will likely be the next driver of revenue growth.
Even though MAU has been growing fast and paying ratio has improved too, the company doesn’t seem to be growing in a sustainable manner. It is spending more on advertising expenses than the revenue it is generating. Cash on hand before IPO proceeds can only sustain SGI’s cash burn for less than two years.
Soulgate Pre-IPO - Unsustainable virtual connection
Soulgate Inc (SGI) is looking to raise up to US$300m in its upcoming U.S. IPO.Soulgate Inc. (SGI) operates Soul app which is an algorithm-driven online social playground. The app is targeted at the younger generations audience (usually born after 1990s) and it aims to provide a virtual space for users (often referred to as Soulers, we will still use users for the sake of clearer terminology) to connect and build social relationships through virtual identities and multi-media content.
SGI has demonstrated breakneck revenue growth as it had only just started monetization in 2019. The company is exploring various avenues for revenue generation and advertising services will likely be the next driver of revenue growth.
Even though MAU has been growing fast and paying ratio has improved too, the company doesn’t seem to be growing in a sustainable manner. It is spending more on advertising expenses than the revenue it is generating. Cash on hand before IPO proceeds can only sustain SGI’s cash burn for less than two years.
Underlying
Soulgate Inc
Provider
Aequitas Research
Aequitas Research is a leading ECM research firm with a focus on IPOs and placements/follow-on offerings across the Asia Pacific with deal size of over USD100m.
Since 2015, we have covered 400+ IPOs and 450+ placements with a hit rate of 73% and 65%, respectively. We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic analysis.
Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis. We also provide a more quant driven analysis on placement/follow-on offerings.
Markets that we cover include:
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Zhen Zhou Toh
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