Iveda (OTCQB:IVDA) - Investor Presentation

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Bob Brilon, President & CFO INVESTOR PRESENTATION October 2015 Common Stock 27.7 MM Shares GO Enabling Cloud Video Surveillance Stock Symbol: IVDA

Transcript of Iveda (OTCQB:IVDA) - Investor Presentation

Bob Brilon, President & CFO

INVESTOR PRESENTATION

October 2015

Common Stock 27.7 MM SharesGO

Enabling Cloud Video Surveillance

Stock Symbol: IVDA

This presentation contains forward-looking statements that represent our beliefs, projections and predictions

about future events. These statements are necessarily subjective and involve known and unknown risks,

uncertainties and other important factors that could cause our actual results, performance or achievements, or

industry results, to differ materially from any future results, performance or achievement described in or

implied by such statements, including statements relating to: (a) Iveda’s future revenue, expenses, margins,

profitability, net income, taxes, adjusted net income, adjusted operating expenses and other measures of

results of operations; and (b) Iveda Solution's ability to capitalize on industry trends. Actual results may differ

materially from the expected results described in our forward-looking statements, including with respect to:

development and acceptance of Iveda’s services; competitive risks, including competing technologies,

products and services, and the competitive activities of our competitors; risks associated with the introduction

of new products and services; risks inherent in strategic relationships, and technology and service integration

efforts. The preparation of our financial statements and forward-looking financial guidance requires us to

make estimates and assumptions that affect the reported amount of assets and liabilities and the reported

amounts of revenues and expenses during the reported period. Actual results may differ materially from these

estimates under different assumptions or conditions.

Iveda assumes no obligation to update any forward-looking statements or information, which are in effect as

of their respective dates. Due to the risks, uncertainties and assumptions inherent in forward-looking

statements, prospective investors in the Iveda Solutions' securities should not place undue reliance on these

forward-looking statements.

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FORWARD LOOKING STATEMENT

Enabling, Disruptive Technology− CLOUD based - NO On-Site SYSTEMS or DVRs

− License SERVICE PROVIDERS to compete for Market Share

INVESTMENT HIGHLIGHTS

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SENTIR - Internet-based video surveillance PLATFORM Enabling

Plug and Play Video Surveillance

Proprietary and Efficient Software Platform− Proprietary cloud based architecture – Patented components

− Storage and Compute efficiency for Big Data

Defined Path to Profitable Growth− Service Provider Contracts in place achieve profitability

Extremely Scalable Recurring Business Model− LICENSE large Service Providers to deliver to Millions of established customers

Large & Growing Market− Nearly $60B Internet based video surveillance market

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Iveda® - CLOUD video surveillance

Access from your phone, tablets, and

computers anywhere in the world

• Alerts – Email and SmartPhone

Notifications

• Live and recorded video

CLOUD is the Disruptive Technology

Displacing DVRs and traditional on-site systems.

IVEDA ENABLES Service Providers to compete for Market Share

(Telcos, ISPs, Data Centers, Cable)

We LICENSE our CLOUD video surveillance software platform

They SELL Security/Peace of Mind to their millions of subscribers

• Plug and play cameras

COMPANY OVERVIEW

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Simple Revenue Model - Extremely Scalable

Service Providers pay IVEDA a monthly fee per Camera

Service Providers Install SENTIR in THEIR Data Center

• THEY have the COST of hosting and storage

License per camera for SENTIR

Customer User Interface; Billing & Admin Tools

Data Center Storage and Compute Optimization; Free Mobile Apps

REVENUE MODEL

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Telecom Data Center

MARKET OPPORTUNITY

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Sources: IDC, Allied Market Research

Estimated CAGR for global

sales for IP video surveillance

from 2013-2020

Global IP Video Surveillance Market by 2020

International VSaaS

North America

$38.6B

$18.7B

$57.3B

37%

User

Friendly

Access live &

recorded video from

your computer or

mobile device.

No On-Site

DVR

Data Stored and

Accessed in the

defined CLOUD

Easy to

Deploy

Devices are

Plug and Play.

Camera

Compatibility

Firmware can

enable any IP

camera.

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Cloud-Based Video Management Platform:

Proprietary and Patented components

SALES STRATEGY

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Telecoms

Data Centers

Cable Service Providers

ISPs

Service

ProvidersEnd Users

Home

SMBs

Enterprise

Government

License Revenue

Camera Revenue

END USER APPLICATIONS

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Home Small & Medium Businesses

(SMBs)Enterprise Government

Sentir’s flexibility and cost-effectiveness provides an almost endless

number of applications.

BABY & PETS

SECURITY

DELIVERIES

EMPLOYEE &

CUSTOMER

Surveillance

MARKETING DATA

SECURITY–OFF HOURS

VANDALISM

REMOTE INSPECTION

MONITOR PRODUCTION

EMPLOYEE SAFETY

SCHOOLS

TRAFFIC

PUBLIC

BUILDINGS

STRATEGIC BENEFITS

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For IVEDA For Service Providers

Scale

Service Providers - Millions of

Customers.

Established Infrastructure

Service Provider will handle billing,

hardware distribution, and data

center for hosting Sentir on their

cloud.

Average Revenue Per User

(ARPU)

Revenue from existing customers

Simple And Cost-Effective

Sentir is designed to utilize and

optimize existing data center.

Pay Per Device Model

No up front fees, immediate positive

cash flow for service providers is an

easy purchase decision and builds

annuity for Iveda.

Infrastructure Utilization

Increased revenues for bandwidth

and data storage in tandem with

video surveillance service.

REVENUE MODEL

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Re

ve

nu

e S

ou

rce

s

Software Licensing Fees - Perpetual

$3/camera/month

Hardware

Service Providers expected to charge $5-$10/per camera

IVEDA generates additional revenue from sales of its

branded cameras

90%

25%

Gross Margin

TELECOM CONTRACTS

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Philippines Long Distance

Telecommunications - PLDT

Philippines Largest Telecom

TELMEX Telecom

Part of America Movil

Vietnam Post

Telecommunications-VNPT

Vietnam’s Largest Telecom

Viettronics – Vietnam’s

Largest Electronics

Manufacturer

FPT – Third Largest

Telecommunications

Provider in Vietnam

RECENT TELECOM PARTNERS UPDATE

• Philippine Long Distance Telephone Co - PLDT• 10,000 unit PO ($1.33MM)

• Vietnam’s Largest Telecom - VNPT• Signed Framework Agreement in December 2014

• Final licensing agreement – Executed April 2015

• 50,000 unit commitment

• Hundreds of units per month per 63 provinces projected

• July – Four Data Centers Installed with SENTIR

• P.O.s and Deposits in Process

• Viettronics • 50,000 camera license commitment first year from June 2015

• Agreement represent at least $1.8 Million in Annual Recurring Revenue

• In process for deposits and P.O.s (end customer is state owned telecom)

• FPT • Agreement signed for 10,000 devices next 12 months

• VIETNAM TWO OTHER MAJOR TELECOMS IN PROCESS

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ILLUSTRATIVE FINANCIALS

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Activations Hardware Hardware

Margin

Annual

License Fee

Estimated Annual

Cash Operating Expense

250,000 $30 M $7.5 M $9 M $4 M

500,000 $60 M $15 M $18 M $4.5 M

1,000,000 $120 M $30 M $36 M $5 M

CASHFLOW ANALYSIS EXAMPLE

Accumulated

ActivationsMonthly

License

Fee

Hardware

Monthly

8k-10k units

Hardware

Margin

Monthly

Cash Op

Exp.

Positive

Cash Flow

30,000 $90K (A) $1 - $1.2M$250K -

300K (B)$225K (C)

A + B - C

$115K to $165K

MONTHLY CASH BREAKEVEN ANALYSIS

ILLUSTRATIVE FINANCIALS

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Customer First Year

Camera

Activations

Average

Camera

Revenue

First Year

Camera

Revenue

Monthly

Sentir Fee

per

Camera

End of First

Year Sentir

Fee Annuity

PLDT10,000 $130 $1.3 Million $3 $0.36 Million

VNPT50,000 –

150,000$120

$6.0 Million -

$18 Million$3

$1.8 Million -

5.4 Million

VIETTRONICS 50,000 $120 $6.0 Million $3 $1.8 Million

FPT -

IvedaHome

10,000 $200 $2.0 Million $3 $.36 Million

Vietnam

Telecom #3

Vietnam

Telecom #4

REVENUE

2015 PROJECT-BASED CONTRACTS

MEGAsys (100% owned Taiwan System Integrator)

• Secured $1.8 M contract with Chunghwa Telecom

• Secured $1.4 M contract with Taiwan Stock Exchange

• Secured $500K contract with Taiwan International Airport

• Secured $1.5 M contract with Chunghwa Telecom

• Secured $544K contract with Chunghwa Telecom for 2015

MEGAsys anticipated to be positive cash flow and

profitable for 2015 with just these announced projects.

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CORPORATE ROADMAP

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With the launch of Sentir in 2014,

Iveda is on course to execute on its

licensing strategy culminating with an

up list to Nasdaq and Profitability.

Path to Profitability

Sign Additional Service Provider

Agreements

NASDAQ Uplist

Achieve Profitability

Sentir Launch April 2014

Existing Service ProviderContracts

EXPERIENCED LEADERSHIP

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David Ly Chairman/

CEO

• 10 years cloud video technology within the security

industry

• 14 years Sales Management, Telecom industry

Bob Brilon President/

CFO

• 30 years’ as CEO, President, and CFO of NASDAQ

technology companies

• InPlay (NASDAQ:NPLA); Duraswitch (NASDAQ:DSWT);

Rental Service Corp. (NYSE:RRR) and Go-Video

(AMEX:VCR)

Dr. Joseph Lee Cloud

Architect

• Cloud computing expert

• CTO at 21Vianet, largest data center in China

• Sr exec at Microsoft, Lucent Technologies, Exxon and

Owens Corning

Dr. Eric Chen Cloud

Storage

• Founder/CEO of CA-based ProphetStor Data Services

• Big Data storage architecture expert

• Sr exec at FalconStor Software (NASDAQ: FALC), IBM

Management

Technology Advisors

Enabling, Disruptive Technology− CLOUD based - NO On-Site SYSTEMS or DVRs

− License SERVICE PROVIDERS to compete for Market Share

INVESTMENT HIGHLIGHTS

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SENTIR - Internet-based video surveillance PLATFORM Enabling

Plug and Play Video Surveillance

Proprietary and Efficient Software Platform− Proprietary cloud based architecture – Patented components

− Storage and Compute efficiency for Big Data

Defined Path to Profitable Growth− Service Provider Contracts in place achieve profitability

Extremely Scalable Recurring Business Model− LICENSE large Service Providers to deliver to Millions of established customers

Large & Growing Market− Nearly $60B Internet based video surveillance market

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GO

APPENDIX

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• Easy to set up

• Excellent video quality at an

affordable price

• See all your cameras on a single

dashboard

• View from your computer, tablet or

smartphone

• Cloud hosted, 24/7 Web access to

live & recorded video

• Off-site cloud storage for video

security

True Plug & Play