When it comes to ‘tech’ centric sectors or platforms, human resources is rarely the first thing people think of.
But, in recent years, ‘HR tech’ has been making steady progress. Cultivating platforms and ideas that are cultivating new avenues for this budding field.
And one such company pioneering in this field is AD1 Holdings Ltd [ASX:AD1]. Better known as Apply Direct. At the time of writing the AD1 share price is up 6.67%, thanks to some promising updates from its latest HR tech venture…
Mastering an artform
Back in October, AD1 acquired a small business known as ‘Art of Mentoring’ (AoM).
A unique venture that provided mentoring services to select professionals and corporations. All of which were branded as ‘best-in-class’ services delivered via a ‘cutting-edge SaaS solution’.
Effectively, they are trying to turn AoM into the premier digital mentor resource. A one-stop-shop for businesses looking to add new insights and learning pathways for their teams. And so far, they’re tracking nicely towards that goal.
As AD1 shared today, AoM has had 15 new clients since the start of the financial year. With eight of those coming after the acquisition was concluded.
Furthermore, they have posted a 100% renewal rate from existing clients for FY21. Granted, they still only have a small user base, but strong levels of retention is a good sign.
Most important of all though, YTD revenue for FY21 is up roughly 80% year-on-year. A fantastic sign as to how well received and promising AoM has been.
As the company notes themselves:
‘The 100% renewal rate is a validation of the confidence that AoM’s customers have in the product offering and further demonstrates the strength of its recurring revenue stream.
‘It is the Company’s expectation that AoM will continue to achieve a strong renewal rate throughout the financial year. AoM is embedded well within Government, Corporates and Professional Associates with notable customers including Toyota Australia, Fair Work Ombudsman, Aurizon and Royal Australian Navy.’
What’s next for AD1?
The challenge now for AD1 is to back up this result and ambition.
Not only by retaining the high renewal rate they currently have, but also by continuing to on board new clients. A prospect that will be vital to growing their business and their service offerings.
For shareholders though, today’s news is certainly welcome. Perhaps a sign of more great things to come.
And for any investors who aren’t AD1 shareholders, it is perhaps even more noteworthy. As this could be the start of a much bigger trend for ‘HR tech’ in 2021. A sector that may finally be emerging as the next big small-cap trend.
Either way, it is definitely something our editors at Money Morning will be watching closely. After all, we’re always on the lookout for small-cap news that the mainstream isn’t able or willing to talk about. Telling our readers about the big trends before they happen.
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For Money Morning