|By Marketwired .||
|August 15, 2014 08:30 AM EDT||
SCOTTSDALE, AZ -- (Marketwired) -- 08/15/14 -- Spindle, Inc., (OTCQB: SPDL) ("Spindle"), a leading provider of mobile commerce solutions, today released the following letter to its shareholders:
Dear Fellow Shareholders,
As part of our ongoing outreach, I want to recap Spindle's activities over the recent quarter. It has been an extremely busy period as we made significant progress on productizing our technologies, and building out our distribution channel to ensure that Spindle has the reach and resources to attack its markets.
With the acquisition of Yowza!!, we began to merge the MeNetwork and Yowza!! platforms, integrate staff, and release to market a powerful product which combines two dynamic -- but completely separate industries -- payments and marketing. This is the founding vision of the company, and it remains its mission today. It is critical that we use all of our resources and capabilities to fortify Spindle's leadership position in the mobile commerce ("M-commerce") sector. Goldman Sachs estimates that M-commerce will become nearly a $700 billion industry within four years. Projections like these clearly illustrate the vast growth that exists in this sector, and certainly validate Spindle's vision in delivering a comprehensive, turnkey solution that serves merchants and consumers with the most compelling features available.
Executing a plan to merge two industries is not without challenges, and to succeed in a rapidly evolving market a company must continuously innovate and quickly embed new technologies that help establish and fortify its leadership role. Thus Spindle, like others in this market, must remain nimble, flexible and attentive to succeed. That has always been, and will remain, Spindle's approach.
I am happy to share that we continue to make notable progress in fulfilling our objectives by bringing together the necessary pieces which will evolve into the industry's first comprehensive mobile marketing and payment acceptance solution, designed specifically for the rapidly expanding retail and mobile commerce sectors. We fully expect to bring this comprehensive solution to market this Fall. As a complete, end-to-end mobile engagement platform, our technology uniquely addresses the varied demands of providers, retailers and consumers.
Among our recent highlights:
-Spindle bolstered its internal sales and marketing resources by bringing in seasoned professionals who have the means and contacts to generate substantial revenue.
-Spindle continues to build one of the most expansive channel networks in the payments industry for merchant aggregation services. For example, the company signed agreements to provide merchant aggregation to a roster of gateway providers, such as Acculync, iConnect and RisePay; expand into new markets like telecom through business services provider Allcom, and MMIT; partner with independent sales organizations such as Moolah, LLC; and engage the developer community through our own developer portal and our relationship with Slim CD, a gateway provider that lets solution developers add payment services through a streamlined configuration portal.
-Many of these new partners have already boarded a sizable number of merchants to our platform. In fact, we've seen an approximate 50 percent uptick in the past quarter alone.
-Spindle introduced the Yowza!! Cloud POS solution, which provides merchants with a low-cost and flexible platform to manage their business operations through a cloud infrastructure. This platform became the foundation for our unique ability to integrate mobile marketing and payments services through a single console.
-Spindle streamlined its marketing activities by sun-setting the MeNetwork brand. We've now consolidated our efforts under the Yowza!! banner, which has greater recognition in both the merchant-facing and consumer-facing sectors. We regularly provide offers on behalf of the 17,000 brands currently on the system, with acceptance at over 120,000 outlets around the nation. This represents an approximate 25 percent increase since the acquisition of Yowza!!. Most notably, Yowza!! delivers a very significant 25 percent conversion rate for coupons presented to consumers through our mobile app. Advertisers can reach consumers who are in store and making buying decisions.
While we are pleased with the overall progress of the company, we made a conscious decision this past Spring to focus the majority of our resources on platform integration and development at the expense of short-term revenue generation, realizing that it was more important to bring a full-featured comprehensive platform to the market, rather than trying to sell a piecemeal solution.
The decision to embed new and innovative features in our platform, along with the increased complexities of integrating the YOWZA!! and MeNetwork platforms, delayed our sales efforts relative to our internal plan. The good news is that our platform development has now reached the stage where we can begin to aggressively sell our solutions to the market. We expect to overcome the lag in revenues by bringing to market our full platform more quickly than would have otherwise been possible, and in a much more methodical and strategic manner.
Due to the foundation that Spindle has now built, we expect to reach the following milestones by the end of 2014:
-Merchant aggregation services, which is the backbone of our revenue, is expected to escalate by the end of the year. In fact, we anticipate doubling our existing merchant base.
-Channel acquisitions are expected to continue to accelerate from this point. We are looking to double the current number of reseller channels over the remainder of the year.
-Downloads of the Yowza!! consumer app, which is currently just over two million, are targeted to reach 2.5 million by the end of the year, as a result of our more aggressive marketing activities.
-Most excitingly, we are on track to deliver our new beacon-ready technology this Fall. This potentially game-changing innovation promises to redefine how merchants and consumers find each other, interact, and ultimately, transact. Deploying low energy Bluetooth beacons in retail locations allow merchants to recognize and communicate with customers when they enter the store -- all through the customer's mobile device. This means that merchants can instantaneously greet customers, identify purchasing behaviors and propensities, and send relevant offers and coupons on the spot. It also lays the foundation to transform the mobile device into a mobile point of sale, which lowers costs and frees up floor space for the merchant, and heightens customer service by eliminating time-consuming check out queues.
Our beaconing solution is expected to provide Spindle with a hyper-growth component to our customer base. Currently, we are deep in discussions with several major brands to begin deploying our beaconing innovations this Fall.
Spindle's foundational technology, combined with its expansive go-to-market strategy, are the primary reasons that the highly respected market research firm Frost & Sullivan elected to give its coveted Customer Value Enhancement award to our company. Frost recognized that Spindle's ability to deliver a 'frictionless commerce' experience is a major differentiator in the market. In its report, Frost wrote that Spindle is "...pioneering new ways for businesses to rapidly integrate mobile payment acceptance and mobile marketing services. With Spindle, merchants can manage customized marketing campaigns from a single interface, and facilitate payment processing as an integrated service. This allows merchants to deliver solutions that take consumers from the discovery stage, to a variety of marketing and engagement activities, to transaction; all within a single app."
We are certainly grateful for this award, and welcome this validation, but frankly, we are even more excited at the opportunity we believe awaits us in the next several months.
There's no doubt that our company has achieved a great deal since we last spoke, but it pales compared to what we believe may lie over the horizon. As I stated in our previous communication with you, all of Spindle's activities are predicated on fulfilling three fundamental objectives that are inherent for building shareholder value: expanding our base of merchants and consumers, delivering advanced, market-leading technology that will serve customer needs well into the future, and protecting our intellectual property through all available and appropriate means.
I am proud of where we are today, and the effort that that our team puts forth every day to achieve these goals. Of course, I'm grateful for the trust and confidence you've placed in our company. The next few months have the potential of being an extremely exciting time for Spindle, and none of which would be possible without your ongoing support.
Chief Executive Officer
About Spindle, Inc.
Spindle is an innovator of mobile commerce solutions for financial services providers and consumer-facing merchants of all sizes. Spindle is focused on pioneering new ways for businesses to rapidly integrate mobile payments acceptance and mobile marketing services while empowering location-based merchant discovery, fulfillment and frictionless mobile payments for consumers. Spindle is dedicated to expanding beyond traditional electronic payment boundaries by offering cutting-edge solutions that allow clients, partners, merchants and consumers to take full advantage of the rapidly emerging mobile economy. Spindle has an extensive proprietary intellectual property portfolio -- which includes patents pending -- that encompass networks, mobile payments, and security. For more information, visit www.spindle.com
This release includes forward-looking statements. All statements regarding our expected future financial position, results of operations, cash flows, financing plans, business strategy, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements, as described in our reports filed with the Securities and Exchange Commission which are available for review at www.sec.gov, to differ materially from anticipated results, performance, or achievements. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
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