At the small end of the Australian share market, there are a number of companies with the potential to grow materially in the future.
Two that investors might want to get better acquainted with are listed below. Here’s what you need to know about these small caps:
Pointerra Ltd (ASX: 3DP)
The first small cap share to look closer at is Pointerra. It is a growing technology company with a focus on the commercialisation of 3D geospatial data.
Pointerra’s technology solves the entrenched problems that are associated with digital asset management workflows and allows very large 3D datasets to be managed and analysed without the need for expensive and time-consuming high-performance computing.
The 3D data is processed and stored in the cloud by Pointerra for instant, on demand user access, anytime, anywhere, on any device. The company notes that this provides actionable 3D information to power digital asset management solutions across a range of sectors.
Demand has been growing for its services, leading to Pointerra reporting an 18% month on month increase in its annual contract value (ACV) to US$5.82 million in November. This is scratching at the surface of a market opportunity that management estimates is worth a staggering $500 billion.
Whispir Ltd (ASX: WSP)
Another small cap to watch is Whispir. It is a growing software-as-a-service communications workflow platform provider which automates communications between businesses and their workers and customers.
This allows users to improve their communications through automated workflows that ensure stakeholders receive accurate, timely, useful, and actionable insights.
Whispir was a very strong performer in FY 2020. For the 12 months ended 30 June 2020, it recorded a 25.5% increase in revenue to $39.1 million and ARR growth of 34% to $42.2 million. This strong form has continued in the first quarter of FY 2021, with its ARR lifting to $43.7 million.
As with Pointerra, this is still only a very small slice of its market opportunity. Management estimates that the Workflow Communications platform as a Service market could reach US$8 billion per year by 2024.
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More reading
- The Pointerra (ASX:3DP) share price has skyrocketed 900% since July
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- This is the latest speculative ASX tech buy from Citigroup
- 2 exciting small cap ASX shares growing fast
- 2 more small cap ASX shares to watch in 2021
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Whispir Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointerra Limited. The Motley Fool Australia has recommended Pointerra Limited and Whispir Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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