IPO of NYIAX: The Next Level of Trading Advertising
This article is dedicated to NYIAX, Inc., whose IPO is scheduled for 10 March on the NASDAQ. NYIAX has developed a high-tech online platform for the convenient and secure buying and selling of digital advertising.
We will go into detail about the issuer’s IPO, its business model, and the outlook of its addressable market; and also describe its financial situation, name its main competitors, and list its strengths and weaknesses.
NYIAX in brief
NYIAX, Inc. has created a digital platform where buyers and sellers of digital advertising can quickly find each other and make secure transactions. The product uses smart contracts and blockchain technology. The issuer strives to provide the advertising business with technical solutions for reliable, secure, and efficient transactions.
The company was founded in 2012 in the US by Carolina Abenante, Graham Mosley, and Mark Grinbaum. The headquarters are in New York. Its president, Christopher Hogan, is currently acting CEO. He previously held the same position at Southside Strategy LLC.
The competitive advantage of the NYIAX platform is that it is using the Nasdaq financial infrastructure and automated financial processes: this enables tracking the life cycle of contracts and optimises the terms for effective communication between advertising market participants in the US. The issuer plans to promote its services in other industries as well.
NYIAX, Inc has built its business model on a patented innovative technology for managing advertising contracts. It is implementedM in the cloud and uses blockchain. The patent belongs to NYIAX, Inc. and Nasdaq Technology AB, a subsidiary of Nasdaq, Inc. The parties have a long-term contract to maintain and support the developed product.
By 31 March 2022, the amount of investment NYIAX, Inc. has raised reached 39.2 million USD. Its main investor is Suwyn Investments, LLC.
Prospects of NYIAX target market
According to eMarketer, the global advertising contract market was valued at 455.3 billion USD in 2021 and is expected to reach 645.8 billion USD by 2024. The projected compound annual growth rate (CAGR) from 2022 to 2024 inclusive is 14.4%.
It is difficult to name the competitors of the issuer, as the technology of smart contracts is not widespread in the market of advertising services yet.
Financial performance of NYIAX
NYIAX, Inc.’s revenue in 2021 reached 0.59 million USD, which is more than 11 times bigger than in 2020. From January to September 2022 inclusive, the figure rose 8.5 times to 0.95 million USD compared to the same months in 2021. From October 2021 to September 2022 inclusive, revenue reached 1.43 million USD.
In 2021, the net loss of the issuer reached 13.5 million USD, which is 118.63% more than in 2020. From January to September 2022 inclusive, the figure decreased by 12.01% to 8.4 million USD compared to the same months in 2021.
By 31 March 2022, the net cash flow of NYIAX, Inc. was negative: 8.4 million USD. At that time, the company had 2 million USD on its balance sheet, while its total liabilities amounted to 11.2 million USD.
Strengths and weaknesses of NYIAX
- Promising addressable market
- Partnership with Nasdaq, Inc.
- Qualified management
- Innovative proprietary technology
- Declining net loss
- Patented product
- No net profits
- Rising operating expenses
- Low level of business diversification
What we know about the NYIAX IPO
The underwriters for the IPO of NYIAX are Boustead Securities, LLC and WestPark Capital, Inc. The ticker of the company’s stock is NYX. The issuer plans to sell 1.85 million common shares at a suggested average price of 5 USD per unit. Gross proceeds from the sale of securities will amount to 9.25 million USD, excluding the sale of options by the underwriter. The corporation might reach a market capitalisation of 78.3 million USD.
The P/S multiple of the issuer might reach 54.7, which is considered on the high side for the addressable market. However, growth during the lock-up period is still possible if the market situation is favourable.
* – Past performance is not a reliable indicator of future results or future performance.
The material presented and the information contained herein is for information purposes only and in no way should be considered as the provision of investment advice for the purposes of Investment Firms Law 87(I)/2017 of the Republic of Cyprus or any other form of personal advice or recommendation, which relates to certain types of transactions with certain types of financial instruments.