Xref (ASX:XF1) FY19 results & outlook


by Rachael Jones

Xref Limited (ASX:XF1) CEO & Co-Founder, Lee-Martin Seymour, talks about the company's candidate reference checking solution for HR departments, partner integration and expansion.

Rachael Jones: Hello, I'm Rachael Jones for the Finance News Network. Joining me today from Xref (ASX:XF1) is CEO and co-founder, Lee-Martin Seymour. Lee-Martin, welcome to the network.

Lee-Martin Seymour: Nice to meet you.

Rachael Jones: Now first of all, Lee-Martin, can you start by giving us an introduction to the company?

Lee-Martin Seymour: So we've been around nine years. Whenever an employer, wherever they are in the world, wants to check out a potential candidate... When I say check out, I mean, has the candidate been where they've said they've been, have they done what they said they'd done and are they who they say they are? So we answer those three questions wherever you are in the world in whatever language or whatever time of day to help protect companies from things like privacy, discrimination and fraud.

Rachael Jones: Now let's talk about your financial year 2019 results. What were the highlights?

Lee-Martin Seymour: But I think anybody that knows Xref knows that we've got two key metrics. We've got our sales of Xref credits and we've got our usage of Xref credits. The big thing out of last year was the fact that our usage of credits was thundering along. And what we tend to have in our business is a huge amount of advocacy. So our clients don't just use our platform. They absolutely love it.

Rachael Jones: Now let's talk about your platform in more detail. What can you tell me about the key features?

Lee-Martin Seymour: So I think when people use Xref for the first time, they love the fact that they don't have to revert to the alternative, which is taking references over the phone and in a manual way. So they get stuck on the Xref button and requesting references and they click the button and they walk away and they feel delighted that this platform is off doing its thing. But on top of the platform, we have things like template builder. We have a library of questions that are the best performing questions in the world translated into 20 different languages in a free builder that the industry can use. Our clients love it. But also we're found by the template builder. And that generates leads for us.

The other product that is quite new to the fold is people search where we actually get our referees to opt in to be contacted as candidates as well. So a lot of our candidate clients use the people search product and these are added revenue streams as well. In the 1st of July this year we announced that we bought RapidID. So we have the ability to check IDs, driving license, passports, any sort of document by the document verification service on a global scale. So that whole question about are you who you say you are, we can do that via RapidID.

And most recently we've integrated the checking services, police checks, working with children checks through our partner CV Check in Australia, Checkr in the US and Ucheck in the UK.

Rachael Jones: Who are your partners and clients?

Lee-Martin Seymour: So we have been on a bit of an integration journey for the last three or four years. We chose to, as part of our global growth story, to integrate with some of the world's leading ATS systems. Commonly a recruiter HR will use what everybody would understand as a CRM, but it's called a ATS, applicant tracking system, and the likes of smart recruiters, Taleo, iCIMS, Bullhorn, JobAdder, PageUp, which is an Australian based ATS. We've integrated with those services so that there's no excuses to not verify a candidate. You can do it within your chosen business as usual platform. What that's meant over the last three or four years is that 20 per cent of our revenue comes through our channel partners. There's a hundred people working at Xref but there's thousands of sales people that work for our partners. So to get our message out globally, it's a fantastic strategy and it's part of our growth journey.

Rachael Jones: Now Lee, let's talk about your strategy and share price. What can you tell me about that?

Lee-Martin Seymour: We have three very clear buckets of growth. Our traditional direct sales team, feet on the ground, banging on doors, and doing demos of Xref for all around the world. The second one is our channel partnerships, 20 channel partners with big sales teams and every region that we're in, marketplaces that we can advertise through, and our channel partners give us really nice, safe carriage into regions that are new to us. And then thirdly, our marketing. Our marketing is just getting better and better.

We used to acquire a client in 90 days from lead to paid four years ago. Last year we got that down to 35 days.I think that our stock is very tightly held. Tim and I, the founders have got 40 per cent of the stock. We have a collection of large instos that are in it for the long haul and what's left is very small. So there's not an awful lot trading on our share price, and Tim and I have a number one goal and that's to bring this public company back to profit as well as retaining our growth metrics over time. So I think we can have the cake and eat it, and our strategy is on that client acquisition to drive revenue globally. We want to be number one. We're best in breed. Our technology outstrips any of our competitors, and it's a very fun time to be both an Xrefer and a shareholder.

Rachael Jones: Excellent. Lee-Martin Seymour, thanks so much for the updates.

Lee-Martin Seymour: Thank you.