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Direct Insite Corp. (OTC QB:DIRI)
Investor Presentation
Electronic Reverse Lockbox for Banks and Billers
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
Some of the statements made in these materials may be forward-looking in nature. If you wantto understand the risks associated with such statements, please review our filings with the SEC.
All material contained in this presentation is the sole property and copyright of Direct InsiteCorp. with all rights reserved. Certain statements, which are not historical fact, may beconsidered forward-looking statements that involve risks and uncertainties. Forward-lookingstatements include statements regarding future business results; future sales and profitability;customer demand; and industry and economic conditions. Various factors could cause actualresults to differ materially from what is set forth in such forward-looking statements. Thesefactors are set forth in our SEC filings. All are cautioned not to place undue reliance on theseforward-looking statements as the Company does not undertake any obligation to releasepublicly any revisions to these forward-looking statements to reflect future events orcircumstances, or to reflect the occurrence of unanticipated events.
Safe Harbor Statement
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
A powerful Unified Working Capital Management platform for banks and corporations.
Currently deployed with > 375,000 Global Network Participants
• Global Receivables solutions for IBM, HP (Shell, Kraft, Mondelez, DWP), Adecco and Carlson• Global Payables solution for Siemens, BE Aerospace, St. Gobain and ATOS• White-label receivables solution for Tier 1 global financial institution (Live Q4 2014)
Competitive Advantages & Opportunity:
• First-mover status in an underserved $2.9 billion segment of the receivables market• Channel Sales Strategy with banks creates viral sales opportunities with corporations• SaaS/Cloud environment / Web-enabled self service tools / ERP Agnostic solution• Strategic multi-million dollar platform investment in PAYBOX™ Generation 4• Regulation, IT security concerns and DSO demands will require automation!
About Us
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
DI facilitates 7 Million B2B transactions worth $160 Billion annually. Growing supplier/customer network of 375,000+ companies.
Expanding Global Commerce Network
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
for Banks
Banks are investing in working capital solutions and offer unique viral access to corporations!
Rationalize Payments Infrastructure
Improve Bank Integration for Payables & Receivables
Enhance Client ExperienceImprove Sales and Product P&L
Top Bank Lockbox Priorities
Electronic payment growth is diverting bank payments revenue. Banks must:▫ Replace revenue lost to declining B2B check volumes ▫ Find a way to preserve their lockbox franchise
PAYBOX™ preserves bank treasury management business:▫ Lockbox is a $1 trillion business (fees/float/deposits) ▫ Lockbox is the second-most lucrative bank treasury product behind lending
Bank market provides opportunity for viral effect with each new client!
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
for Corporates
The Accounts Receivable Market
$1.3 trillion global market is spent annually on receivables solutions
15.5 billion business-to-business invoices generated in the U.S. annually
60% of U.S. corporations are dissatisfied with their receivables and payments processes
– Only 50% of receivables in the U.S. post without human intervention
– 75% of U.S. corporations have too many receivables with incomplete or inaccurate data
– 74% of U.S. corporations have a growing number of receivables that require human intervention
E-invoice
Presentment
Invoice Inquiry
and Approval
Workflow
Electronic
Payments (ACH,
Credit Card)
Dynamic
Discount &
Supply Chain
Financing
Payment
Reconciliation
Unified Working Capital Management
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
The Challenge: IBM wanted to improve its order-to-cash processes to achieve three objectives: Improve the efficiency of generating 4.1 million invoices annually Enhance customer service Reduce Days Sales Outstanding (DSO)
Direct Insite Solution Web-based electronic invoice presentment generating 4.1 million invoices annually Fully automated dispute management Support for 113 countries, 15 languages and 100+ currencies
Working Capital Results Reduced DSO by approximately four days $50 million increase in available cash $4 million annual savings in interest expense 65% fewer billing disputes Nearly three-fold increase in trading partner satisfaction with invoice process
“Transforming IBM’s AR processes with Invoices On-Line™ resulted in a 90 percent reduction in transaction costs, 65 percent fewer billing disputes and calls, and a 10 percent reduction in DSO. These benefits have annually delivered tens of millions of dollars in savings to IBM.”
—Ellie Mahoney, Invoices On-Line Americas E-Business Advocate for IBM
for Corporates Case Study
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
Channel Opportunity
Annual paper business-to-business invoices from corporates with $1 billion+ revenues that go through a bank lockbox
5 billion
Total available market of PAYBOX™ from large corporate volume through bank lockboxes² $1.25 billion annually ~$100 million monthly
DIRI Revenues from 2% bank market penetration $25 million annually
DIRI Revenues from 3% bank market penetration $37 million annually
DIRI Revenues from 4% bank market penetration $50 million annually
1: Analysis of data from PayStream Advisors and the U.S. Department of Commerce 2: Remittance Coalition, based on 5 billion total annual B2B lockbox transactions
Total Available Market
Direct Corporate Opportunity
Annual paper business-to-business invoices among corporates with $1 billion+ revenues that does not go through a bank lockbox
6.78 billion
Total available market for PAYBOX™ from large corporates that do not use a lockbox $1.7 billion annually
Total Market Opportunity: Channel and Direct Corporate
Annual paper business-to-business invoices among corporates with $1 billion+ revenues¹ 11.78 billion
Total available market for PAYBOX™ from large corporates – via a bank lockbox & in-house $2.9 billion annually
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
The Accounts Payable Opportunity
Using Direct Insite's Accounts Payable platform:▫ Improves working capital management with dynamic discounting and supply chain financing▫ Enables corporations to capture more discounts through accelerated invoice processing
turnaround▫ Provides visibility required for liquidity management and cash flow analysis
Direct Insite has deployed its Accounts Payable solution across four global enterprise customers
PAYBOX™ will integrate with any legacy electronic Accounts Payable solution
Vendor Lynx Express
Scan and Capture
E-invoicing & Workflow Processing
Payment Processing
Dynamic Discount Management &
Supply Chain Financing
Unified Working Capital Management
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
The ChallengeSiemens wanted to improve their Accounts Payable processes by achieving the following:
Reduce supplier inquiries and related call center costs
Take invoicing beyond transaction processing into strategic “value-added” activities
Direct Insite Solution
Electronic invoicing platform processing over 2.4 million invoices annually
Supports more than 50 Siemens business units
Backbone of Accounts Payable shared services environment
Servicing 60,000 suppliers and 5,000 internal users
Working Capital Results
Posts payments for 63% of its invoices without operator intervention
Reduced workflow time by two thirds for electronic invoices and one third for paper invoices
81% of invoices are received electronically
Facilitates dynamic discounts
Supplier inquiries reduced by 67%
Integrated with supply chain finance company
“Invoices On-Line has proven to be an effective tool in the transformation of our Accounts Payable automation initiatives with a goal of reducing paper handling, invoicing costs and supplier inquiries.”
-Roderick Fields, GSS NA Director of
Disbursement Services
Siemens Shared Services Case Study
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
• Deploying PAYBOX™ in Tier 1 global financial institution (Q4).
• Contract renewals of our existing core revenue customers (7 Accounts).
• Multi-million dollar investment in technology, infrastructure and resources.
• Assist and drive viral growth in customer base of our first Tier 1 bank.
• Develop and sign three additional banking partnerships.
• Target direct corporate customers with bank interfaces.
• Target and develop strategic relationships with Bank solution providers.
• Continue viral growth in all customer channels and begin to monetize network benefits.
• Identify strategic technology partners in banking industry.
• Expand profit margins through extension of PAYBOX AR capabilities.
• Expand profit margins through integration of e-invoicing and e-payments.
2016
2015
2014
Focus & Objectives
Direct Insite Corporation ∙ Copyright 2014 ∙ Confidential & Proprietary
Why invest now? First-mover offering of a private-label AR solution for banks
▫ Opens door to underserved $2.9 billion segment of receivables market
Globally deployed solution for corporates
Recurring revenue SaaS business model with “sticky” long-term evergreen contracts
DIRI trades at lower multiple to peers, but with stronger core customers and offerings
Recent market valuation less than 1X TTM revenue
Corporate Financial Highlights: Debt free $3.0 million in cash and receivables $27 million in Net Operating Loss Carry Forwards Board/management/associates aligned with investment community
Conclusion
Matthew E. OakesChairman & Chief Executive Officer
www.directinsite.com
Contact Information