Recruitment technology provider AD1 Holdings (ASX: AD1) has added new clients and reported a significant revenue increase for its Software-as-a-Service (SaaS) business, Art of Mentoring.
The company today provided a performance update in relation to the mentoring platform, which it acquired late last year for $1 million in cash and $500,000 in shares.
It said 15 new customers have been added to its portfolio since the start of the 2021 financial year (July 2020), with eight of these having been acquired since the acquisition.
The platform has also achieved a 100% renewal rate, successfully renewing all 16 clients that were due for renewal since the start of the financial year.
In addition, the subsidiary is trending around 80% above its revenue for the same first half-year period of the previous financial year.
“Art of Mentoring has built a strong sales pipeline, which is expected to continue to support its new business momentum,” AD1 stated in today’s announcement.
“The 100% renewal rate is a validation of the confidence that Art of Mentoring’s customers have in the product offering and further demonstrates the strength of its recurring revenue stream.”
AD1 said it expects the business to continue to achieve a strong renewal rate throughout the second half of the financial year.
Art of Mentoring acquisition rationale
Art of Mentoring is a SaaS platform that designs, implements and provides mentoring services to organisations and is backed by evidence-based programs, expert consultants and software.
When first revealing the acquisition, AD1 chief executive officer Prashant Chandra described the business as a “compelling strategic fit for the company with a cutting-edge SaaS product, diversified recurring revenue and strong growth prospects”.
“Our complementary customer base will enable the company to expand its footprint within both the government and professional association sectors,” he added.
Some of Art of Mentoring’s most notable customers include Toyota Australia, Fair Work Ombudsman, Aurizon and the Royal Australian Navy.
In October, AD1 undertook a share placement to raise $2.5 million to fund the acquisition and integrate the platform, with remaining funds to be reserved for future acquisitions.