It was only
a few years ago, in October 2012, that Nasdaq-listed Net Element stepped into
the public market and aggressively set out to operate a sustainable,
revenue-generating business model built on cutting-edge technologies. In
2013-2014 the company divested its non-core assets and turned its focus to
mobile and e-commerce, both of them burgeoning markets with favorable economic
trends and trajectory for continual growth.
What do
these “favorable trends” look like? Net Element is part of the $796 billion
global m-payments market, which is expected to achieve annual growth of 58.5%
in years to come. Add to that the company’s parallel participation in the $1.79
trillion global e-commerce market, which is expected to gain 18.1% annual
growth, and you get a tremendous playing field. The figures are just figures,
however, until you add into the equation Net Element’s strategy to capitalize
on this market.
The use of
non-cash forms of payments, including mobile payments, has steadily increased
over the last decade and continues to climb and outpace cash transactions.
Taking advantage of this trend, Net Element divided its business into three key
segments: mobile payments, value-added services, and payment processing. Within
these segments, Net Element works through four brands (TOT Group, Unified
Payments, TOT Money and Aptito) and across all payments channels, including
mobile, online and offline transactions, to offer services to brick and mortar
businesses, the hospitality industry and the broader payments market.
Net
Element’s business model has two facets that are well worth noting. The first
is that all company revenues are recurring from a strong established customer
and partner base, which includes more than 100 independent value-added dealers
and agents in the U.S. alone. The second is that the Net Element doesn’t carry
all its fruit in one basket; success is not contingent on one customer – in fact,
the largest customer/merchant represents only 3% of revenues. On that note, Net
Element in November reported Q3 revenues of $6.03 million, debt reduction of
$15 million, and a narrowed quarterly loss.
To keep the
recurring sales wheel in motion, Net Element continuously greases the wheels of
its revenue drivers with the continual expansion of its merchant base, emerging
technology roll-outs and strategic portfolio acquisitions. A bit of brand
association doesn’t hurt, either. Net Element recently went straight for the
heart of the payments industry with an agreement to provide Apple Pay services
to its secure mobile-transaction platform. The deal made it possible for
merchants with Net Element’s transaction platform to handle and process the
increasingly popular Apple Pay.
Maintaining
an aggressive pursuit of its share of the mobile and e-commerce markets in 2015
and beyond, Net Element keenly recognizes its position in the market and is
working to embolden its key advantages. In its brief history as a publicly
traded company, Net Element has demonstrated its ability to introduce
innovative products and solutions, employ a successful sales strategy,
establish valuable partnerships and take advantage of fast growing markets.
For more
information, visit www.netelement.com
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