Thanks for joining us today for the SRAX first quarter 2021 earnings call. It was another record quarter for SRAX and our Sequire platform. First, I want to cover some of the major accomplishments for the quarter. Revenue growth was up 1,400% year-over-year on a consolidated basis and 2,800% for Sequire alone.

Revenue growth quarter-over-quarter was up 20% on a consolidated basis. Sequire on its own is up 31% quarter-over-quarter. We beat our guidance of $5 million in Q1 and are reaffirming our Q2 guidance of $7 million. We continue to need to consolidate Big Token until we fall below certain ownership thresholds and other criteria.

But on a standalone basis, Sequire has an EBITDA 500,000 for the quarter. We've now seen nine consecutive quarters of continued revenue growth for Sequire. We've grown the number of clients that have joined this Sequire platform to 200, a 9% increase since our call just six weeks ago and 294% year-over-year..

Thank you, Chris. Before we review the first quarter operating results, I'd like to remind everyone that, during the quarter, we closed on the transaction to move our Big Token business into its own publicly traded company.

Although Big Token is now a separate entity with a separate board and a balance sheet, for the time being, due to consolidation accounting principles, we're required to consolidate the business and its accounts within SRAX.

As Chris mentioned earlier, we're continuing to see substantial revenue growth at Sequire, which drove our quarterly revenue to $5.4 million or 1,400% over prior year and 31% over the fourth quarter of last year. Our Sequire business continues to represent the majority of our revenue growth through the continued growth of its subscription base.

Revenues for the quarter finished at $4.5 million, up from $100,000 in the prior year and up 31% from last quarter. Our profit margins continued to perform in line with expectations. For the quarter, they were 70%, which is up slightly from the prior year. Operating expenses were $5.3 million as compared to $4.1 million in the prior year.

The increase in operating expenses for the quarter is primarily driven by increased sales and operational costs associated with the rapid expansion of the Sequire platform and its associated revenue growth. Our resultant operating loss for the quarter was $1.5 million as compared to an operating loss of $3.9 million.

When excluding the Big Token business operations, we had positive operating income for the quarter of $52,000 as compared to a loss of $1.6 million and EBITDA of $500,000 as compared to an EBITDA loss of $1.5 million over the prior year. Now moving to a few highlights from our consolidated balance sheet.

As of March 31, we had cash and marketable securities totaling $13.5 million and $18 million respectively. And during the quarter, our debt reduction continued as our outstanding debt decreased from $9 million to $3.1 million as of March 31, 2021.

At this time, we're still working through the accounting related to the financing and transactional elements with the FPD transaction and we'll be including further discussion in our upcoming 10-Q. And now, I'd like to turn the call back to Chris..

. First question comes to us from Mike Crawford..

First, let's ask about the business. And then I have a question about the balance sheet. But on the business, well, first of all, it's great to hear that you expect to exceed the $10 million of Sequire bookings from last quarter and this quarter. That's phenomenal.

But you also teased about forthcoming features to be added to the platform that you are more excited about then Audience and some of the other features you've unveiled so far.

So, can you say what these forthcoming features are that you're developing and when we might see them?.

We have a big pipeline of stuff that's going to be released in this quarter. So I think that the best opportunity would be just to wait for those press releases to come out during this quarter. The stuff that we're releasing in this quarter is some of the best stuff that we've built into the platform. They won't have to wait long..

That would help the Sequire platform companies do better at interpreting, managing engaging with their investors.

Is that basically the idea?.

Yeah, a lot of room around that, around financing, around communication tools. And, obviously, Audience is a big feature that we completed with Zoom. So, I think that all of these things together. I'm more excited about the stuff that's coming up in the next – the rest of this quarter and then also the rest of the year..

I guess we'll stay tuned.

Is it still around 30% of these now 200 companies on the platform are subscribing to ancillary services?.

Yes. Approximately..

And do you see a lot of repeat buyers there?.

Yeah, we're at that time of time of evolution of the business. We're starting to see a lot of repeat business from the people that were buying media previously and are continuing to buy media now..

Historically, you've had this data driven company where you've helped companies find insights about their businesses or reach new audiences. And I think you're doing some of that now for these companies, but primarily, it's been investor outreach focused as opposed to reaching companies, customers or suppliers..

That's where our data sets are. We have a lot of data on who's willing to invest in OTC companies, who's willing to invest in NASDAQ companies, who is interested in pharma companies, technology companies, and so on. So, we've gathered a ton of information through all of us.

And that's really why the community piece is very important to us and tying that all together with LD Micro..

Of the new companies that are coming on, are they still a good mix of OTC or is it swinging more towards listed?.

No, it's around half and half..

Okay. One last question and then I'll turn it over.

Thank you, Mike, for giving the cash and debt data from the end of the quarter? What about the share count, say, average for Q1 and maybe diluted shares outstanding as of today?.

The shares outstanding at the end of the quarter were approximately 23 million and the weighted average is just over 19 million that we'll use in the calculation which will be obviously included in the Q.

On a fully diluted basis, we would add approximately additional 10 million warrants and then approximately 1.2 million in employee options on top of that. So, you're going to get to, call it, 34 million shares..

But that's warrants that have $7.50 strike price and a bunch of other warrants in between?.

Yeah, the majority of which are the $7.50s. Approximately 5.5 million, 6 million of them are the $7.50s. .

But on an undiluted share count basis, Mike, can you give that number?.

At the at the end of the quarter, we had issued an outstanding of approximately 23 million shares. And then, on a weighted average basis, Mike, for purposes of calculating EPS, it's just over 19 million..

Okay, I got it. And so, maybe half of those 10 million warrants, unless your stock goes over $7.50, don't exercise. And if they do, then you pull in all that cash. And then I can figure out the strike on the other. .

If all the warrants got exercised, it'd be around $54 million in cash..

Our next question comes to us from Dave at TrickleResearch.com. We have C. Rostad at EpsonWoodCapital.com. I see that you're unmuted, but we're not hearing you. We have K. Kapas at the ForensicEdge.com. .

All right. Well, looks like there's some issues with getting through the computer people..

All right. Well, we have the LD Micro conference that's coming up here in June 8 through the 11th. And we hope you all can make it. We have around 300 companies that will be presenting at that conference. And we're really excited about that.

We're finding that there's a direct correlation between the companies that are signing up and the people that are joining the Sequire platform. We look forward to seeing you there. We hope to be back to getting in-person meetings at some time by the end of this year with LD Micro. Like I said earlier, there will always be a virtual element to that.

But we're creating this community where people can participate in person or at these different events. So, we appreciate you being with us today. We'll post this video up on to our website very shortly. So, if you wanted to watch it again, you can take a look at it there. Thank you very much..