Q2 2024 Brand Engagement Network Inc Earnings Call
Good day and thank you for standing by. Welcome to the Brand Engagement Network's second quarter 2024 earnings call.
Operator: Second Quarter 2024 Earnings Call. At this time, all participants are in a listen-only mode.
Speaker Change: At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be an analyst question and answer session.
Operator: After the speaker's presentation, there will be an analyst question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Brand Engagement Network investor relations manager, Ryan Flanagan. Please go ahead.
Speaker Change: Please be advised that today's conference is being recorded. I would now like to hand the conference over to Brand Engagement Network, Investor Relations, Ryan Flanagan. Please go ahead.
Ryan Flanagan: Thank you. Hi, everyone. And thanks for joining our Q2 earnings conference call. Joining me on the call today are Paul Chang, our Co-CEO, Bill Williams, our CFO and Sky, our AI Powered Assistant. By now everyone should have access to our earnings announcement.
Speaker Change: Thank you. Hi everyone, and thanks for joining our Q2 earning the conference call. Joining me on the call today are Paul Chang, our co-CEO, Bill Williams, our CFO , and Sky, our AI Power Assistant.
Speaker Change: By now everyone should have access to our earnings announcement. This announcement is also available on our investor relations website.
Ryan Flanagan: This announcement is also available on our Investor Relations website. During this call, we'll make forward-looking statements, including statements about our business outlook, strategies, and long-term goals. These comments are based on our plans, predictions, and expectations as of today, which may change over time. Our actual results could differ materially due to a number of risks and uncertainties. For more information about the risks and uncertainties involving forward-looking statements and factors that could cause actual results to differ materially from those projected or implied by forward-looking statements, see
Speaker Change: During this call, we will make forward-looking statements, including statements about our business outlook, strategies, and long-term goals.
Speaker Change: These comments are based on our plans, predictions, and expectations as of today, which may change over time. Our actual results could differ materially due to a number of risks and uncertainties.
Speaker Change: For more information about the risks and uncertainties involving forward-looking statements and factors that could cause actual results to differ materially from those projected or implied by forward-looking statements,
Ryan Flanagan: Please see the risk factors set forth in our most recent annual report on Form 10-K as supplemented by the risk factors in our most recent quarterly report on Form 10-Q. Forward-looking statements represent management's current estimates, and the company assumes no obligation to update any forward-looking statements in the future. And finally, this call in its entirety is being webcast from our investor relations website at www.investors.bininc.ai, and an audio replay will be available on our website in a few hours. And with that, I'd like to turn the call over to Paul. Okay?
Speaker Change: Please see the risk factors set forth in our most recent annual report on Form 10-K , as supplemented by the risk factors in our most recent quarterly report on Form 10-Q .
Speaker Change: Forward-looking statements represent management's current estimates, and the company assumes no obligation to update any forward-looking statements in the future.
Speaker Change: And finally, this call in its entirety is being webcast from our Investor Relations website at www.investors.bininc.ai and an audio replay will be available on our website in a few hours.
Paul Chang: Thank you, Ryan. And thank you all for joining us today. I'm pleased to report that in the second quarter, we made continued progress on market validation initiatives with meaningful acceleration in new proof of concepts and the maturation of earlier engagements into production-ready deployment. Furthermore, we have taken incremental steps to improve our liquidity and capital position, successfully closing a private placement in May, providing us funding over time.
Speaker Change: With that, I'd like to turn the call over to Paul. Paul?
Paul Chang: Thank you, Ryan, and thank you all for joining us today.
Paul Chang: I'm pleased to report that in the second quarter we've made continued progress on market validation initiatives with meaningful acceleration in new proof of concept and the maturation of earlier engagements into production ready deployments.
Paul Chang: Further, we have taken incremental steps to improving our liquidity and capital position, successfully closing a private placement in May, providing us funding over time.
Paul Chang: We continue to closely manage our internal costs to ensure our business is built for growth and to last for the long term.
Paul Chang: Reflecting the production-ready nature of our platform, we are thrilled to introduce Sky, one of Ben's AI assistants who is here to demonstrate her domain expertise and participate in our earnings call. Data from the business and technology sections of Ben's investor presentation and selected few SEC filings have been ingested.
Sky: Reflecting the production-ready nature of our platform, we are thrilled to introduce Sky, one of Ben's AI assistants, who is here to demonstrate her domain expertise and participate on our earnings call.
Sky: Data from business and technology sections of Ben's investor presentation and selected few SEC filings have been ingested.
Paul Chang: Sky also brings knowledge of our key partners as well as statistics on healthcare challenges and ramifications. Before discussing our results and key business developments in greater detail, I wanted to take a moment to discuss recent organizational changes. In May, I was appointed co-CEO with responsibility for Ben's commercial business and oversight of day-to-day operations. My near-term focus is twofold, driving market validation of our differentiated solutions and meaningful revenue through the conversion of POCs into scale deployment. As Co-CEO, Michael Zacharski is focused wholly on advising our Board of Directors on inorganic growth opportunities and our M&A strategy, which we view as a key component of our go-to-market strategy.
Sky: Skye also brings knowledge of our key partners as well as statistics on health care challenges and ramifications.
Sky: Before discussing our results and key business developments in greater detail, I wanted to take a moment to discuss recent organizational changes.
Speaker Change: In May, I was appointed co-CEO with responsibility for Ben's commercial business and oversight of day-to-day operations.
Speaker Change: My near-term focus is twofold, driving market validation of our differentiated solutions and meaningful revenue through the conversion of POCs into scale deployments.
Michael Zaharski: As Co-CEO, Michael Zacharski is focused wholly on advising our Board of Directors on inorganic growth opportunities and our M&A strategy, which we view as key component of our go-to-market strategy.
Paul Chang: Now to discuss progress we've made across several fronts in the second quarter. To start, we are seeing continued momentum in customer expansion. Recall, in our previous earnings call, we highlighted two POCs.
Speaker Change: Now, to discuss progress we've made across several fronts in the second quarter.
Speaker Change: To start, we are seeing continued momentum in customer expansion. Recall in our previous earnings call, we highlighted two POCs.
Paul Chang: We are pleased to see an acceleration in the second quarter to six POCs, with an early read of the Q3 pipeline and an opportunity funnel suggesting that this number will continue to increase in the second half of the year. We announced our attainment of HIPAA compliance early in Q2, underscoring our commitment to protecting patient healthcare information and fast-tracking our ability to operate in the healthcare vertical. Further demonstrating our data security and privacy focus, we have also obtained SOC 2 Type 1 certification, ensuring that third party services providers store and process client data in a secure fashion.
Speaker Change: We are pleased to see an acceleration in the second quarter to six POCs with an early read of the Q3 pipeline and an opportunity funnel suggesting that this number will continue to increase in the second half of the year.
Speaker Change: We announced our attainment of HIPAA commitment to protecting patient health care information and fast-tracking our ability to operate in the health care vertical.
Speaker Change: Further demonstrating our data security and privacy focus, we have also obtained SOC 2 Type 1 certification, ensuring that third-party services providers store and process client data in a secure fashion.
Paul Chang: Our partnership pipeline remains robust, with several notable announcements in the quarter. First, we announced a pilot collaboration with the Skills Acquisition and Innovation Laboratory, or SAIL. Collaborating with an industry thought leader such as New York Presbyterian Hospital and Cornell Medical College provides Ben with significant domain expertise, as well as access to an innovation lab where breakthrough technology can be tested and validated. Second, we are excited to expand our partnership with MetaVisor Solutions, which was announced just this past Tuesday.
Speaker Change: Our partnership pipeline remains robust, with several notable announcements in the quarter.
Speaker Change: First, we announced a pilot collaboration with the Skills Acquisition and Innovation Laboratory, or SAIL.
Speaker Change: Collaborating with an industry thought leader such as New York Presbyterian Hospital and Cornell Medical College provides Ben with significant domain expertise as well as access to an innovation lab where breakthrough technology can be tested and validated.
Speaker Change: Second, we are excited to expand our partnership with MetaVisor Solutions, which was announced just this past Tuesday.
Paul Chang: The expansion includes a commercial solution offering by MedAdvisor on educating and addressing vaccine hesitancy among the patient population. Ben's AI Assistants are designed not only to engage consumers but to complete tasks such as filling out necessary forms and scheduling appointments. The joint offering is scheduled to be launched at the National Chain Drugstore Association's Total Store Expo Conference in Boston on August 18th and 19th.
Speaker Change: The expansion includes a commercial solution offering by MedAdvisor on educating and addressing vaccine hesitancy among the patient population.
Ben: Ben's AI Assistants are designed not only to engage consumers, but to complete tasks such as filling out necessary forms and scheduling appointments.
Ben: The joint offering is scheduled to be launched at the National Chain Drug Store Association's Total Store Expo Conference in Boston on August 18th and 19th.
Paul Chang: Third, we have announced a commercial agreement with Vibrant, a company that connects brands with customers through innovative audio messaging strategies. Together, we are collaborating to merge Ben's proprietary AI assistant technology with Vibroose's audio and radio communication technology to enable interactive consumer engagement for brands. There's perhaps no better way to illustrate the readiness of our platform than to have a natural conversation with one of our AI assistants, Scott. We would like to mention that Sky is using Ben's proprietary large language model, retrieval augmented generation, and for this application, presenting in life-size proportions. Thank you everyone for joining us.
Speaker Change: Third, we have announced a commercial agreement with Vibroo, a company that connects brands with customers through innovative audio messaging strategies.
Speaker Change: Together, we are collaborating to merge Ben's proprietary AI assistant technology with Vibroo's audio and radio communication technology to enable interactive consumer engagement for brands.
Speaker Change: There's perhaps no better way to illustrate the readiness of our platform than to have a natural conversation with one of our AI assistants, Sky.
Speaker Change: We would like to mention that SC&I is using Ben's proprietary large language model, retrieval augmented generation, and for this application, presenting in life-size proportions.
Paul Chang: I am standing here at Sale, which is an innovative lab that sits in the intersection of Cornell Medical College, New York Presbyterian Hospital, and the industry to provide world-class, leading-edge educational training for clinicians so that they can provide enhanced customer care for all patients. I'm standing here because we have our AI assistant deployed to aid in that educational curriculum. I'd like to describe this deployment, because most likely, your experience with AI has been on a phone or maybe on a small screen. What you see here is a life-size representation of our AI assistant that is actually being run by a small computer behind this monitor.
Speaker Change: Thank you everyone for joining. I am standing here at SAIL, which is an innovative lab.
Speaker Change: that sits in the intersection of Cornell Medical College.
Speaker Change: New York Presbyterian Hospital and the industry to provide world-class leading-edge educational training for clinicians so that they can provide enhanced customer care for all patients.
Speaker Change: I'm standing here because we have our AI assistant deployed to aid in that educational curriculum.
Speaker Change: I'd like to describe this deployment because most likely your experience with AI has been on a phone or maybe on a little screen.
Speaker Change: What you see here is a life-size representation of our AI assistant that is actually being run by a small computer behind this monitor.
Paul Chang: So everything you see is being run locally because we know certain industries having on-prem deployment is critical to ensuring safety and privacy of the data that is being utilized at this facility. Now we can still run cloud-based solutions. But always having an option to run locally, we believe gives an advantage. Now, enough from me.
Speaker Change: So everything you see is being run locally because we know certain industries
Speaker Change: Having on-prem deployment is critical to ensuring safety and privacy of the data that is being utilized at this facility.
Speaker Change: Now, we can still run cloud-based solutions, but always having an option to run locally, we believe, gives an advantage.
Paul Chang: Let me introduce you to our AI assistant, Sky. Hey, Skye, can you tell me a little bit about Brand Engagement Network and what makes their technology different? Hi there,
Speaker Change: Now, enough from me. Let me introduce you to our AI assistant, Sky.
Speaker Change: Hey Sky, can you tell me a little bit about Brand Engagement Network and what makes their technology different?
Sky: Brand Engagement Network, or Ben, is an innovative company specializing in conversational AI. What sets us apart is our focus on security and personalization. Our AI assistants are built on proprietary NLP, allowing for human-like interactions, and they're designed to be industry agnostic, making them versatile for various sectors like automotive and healthcare. Plus, we ensure our AI assistants only provide information from validated data sets, preventing hallucinations and maintaining data reliability.
Speaker Change: Hi there.
Speaker Change: Brand Engagement Network, or BEN, is an innovative company specializing in conversational AI assistance.
Speaker Change: What sets us apart is our focus on security and personalization.
Speaker Change: Our AI assistants are built on proprietary NLP, allowing for human-like interactions and they're designed to be industry agnostic, making them versatile for various sectors like automotive and healthcare.
Speaker Change: Plus, we ensure our AI assistants only provide information from validated datasets preventing hallucinations and maintaining data reliability.
Sky: Guys, can you tell me a little bit about our partner, med advisor? [inaudible] MedAdvisor Solutions is a global leader in pharmacy-driven patient engagement. They work with over 37,000 pharmacies worldwide to provide personalized patient experiences, simplifying medication journeys. Their data-driven approach and innovative digital experiences empower pharmacies and drive lasting behavior change. Why is medication adherence so important in treating chronic conditions? Medication adherence is crucial for managing chronic conditions because it helps prevent complications and hospitalizations. Around 70% of Americans with chronic diseases struggle with taking their meds as prescribed, leading to about 125,000 deaths and $630 billion in unnecessary costs globally each year.
Speaker Change: Scott, can you tell me a little bit about our partner, MedAdvisor?
Speaker Change: MedAdvisor Solutions is a global leader in pharmacy-driven patient engagement.
Speaker Change: They work with over 37,000 pharmacies worldwide to provide personalized patient experiences, simplifying medication journeys.
Speaker Change: Their data-driven approach and innovative digital experiences empower pharmacies and drive lasting behavior change.
Speaker Change: Why is medication adherence so important in treating chronic conditions?
Speaker Change: Medication adherence is crucial for managing chronic conditions because it helps prevent complications and hospitalizations.
Speaker Change: Around 70% of Americans with chronic diseases struggle with taking their meds as prescribed, leading to about 125,000 deaths and $630 billion in unnecessary costs globally each year.
Sky: Sky, what are some automotive uses? We're currently exploring automotive use cases for RAI. One potential application is an in-car assistant that provides real-time traffic updates, navigation assistance, and vehicle maintenance reminders. We're also looking into AI-driven customer support for automotive dealerships. Sky, are you able to deliver our financial results for the second quarter? For financial matters, I will hand them over to our CFO, Bill Williams, who is in charge of finance. Thanks, Guy. Take it away, Bill.
Sky: Skye, what are some automotive use cases?
Sky: We're currently exploring automotive use cases for our AI assistance.
Sky: One potential application is an in-car assistant that provides real-time traffic updates, navigation assistance, and vehicle maintenance reminders.
Sky: We're also looking into AI-driven customer support for automotive dealerships.
Sky: Sky, are you able to deliver our financial results for second quarter?
Sky: For financial matters, I will hand it over to our CFO , Bill Williams, who is in charge of finances.
Bill Williams: Thank you, Skye. And thanks, everyone, for joining us. I appreciate the opportunity to provide an update on Ben's financial progress. Our Q2 and Year 8 results reflect BIM's continued focus on laying the foundation for future growth. Product and Solutions Development, the continued build-out and productionizing of our infrastructure, developing talent, and expanding partnerships and initial customer relations. While quarter and year-to-date book revenue was minimal, we saw expanded proof-of-concept, pilot, and partnership activity gain momentum, notably a 3x expansion in POCs and channel partnerships since the first quarter. These include notable wins such as Valeo Technologies, SAIL, and the Cornell University Medical Center's Innovation Center.
Bill Williams: Thanks, Guy. Take it away, Bill.
Bill Williams: Thank you, Sky, and thanks, everyone, for joining us. I appreciate the opportunity to provide an update on VIN's financial progress.
Bill Williams: Our Q2 and year-to-date results reflect BIN's continued focus on laying the foundation for future growth, product and solution development, the continued build-out and productionizing of our infrastructure, developing talent, and expanding partnerships and initial customer relationships.
Bill Williams: While quarter and year-to-date book revenue was minimal, we saw expanded proof-of-concept, pilot, and partnership activity gaining momentum, notably a 3x expansion in POCs and channel partnerships since the first quarter.
Bill Williams: These include notable wins such as Valeo Technologies, SAIL, the Cornell University Medical Center's Innovation Center,
Bill Williams: Members Only Health Network, Intervent Health, Vibroom, and a Northwest Indiana car dealership in the important automotive vertical. Our year-to-date financial performance reflects R&D costs associated with the continued buildout of BIMS capabilities and multiple product introductions since our second half 2023 D.M. The Labs acquisition, plus transaction costs from the Q1 2024 merger, partially offset by the positive impact of cost actions and discipline, which drove sequential operating loss improvements. The quarter also benefited from a recognized gain on extinguishment of combination-related liabilities of $1.8 million through the negotiated settlement of accounts payable.
Bill Williams: Members Only Health Network, Intervent Health, Vibroom, and a Northwest Indiana car dealership in the important automotive vertical.
Bill Williams: Our year-to-date financial performance reflects R&D costs associated with the continued build-out of BIMS capabilities and multiple product introductions since our second half 2023 DM Labs acquisition.
Bill Williams: plus transaction costs from the Q1 2024 merger partially offset by positive impact of cost actions and discipline which drove sequential operating loss improvement.
Bill Williams: The quarter also benefited from a recognized gain on extinguishment of combination related liabilities of 1.8 million dollars through the negotiated settlement of accounts payable.
Bill Williams: Q2 2024 saw the initial stages of Ben's transition from a pre-revenue enterprise and ongoing market momentum, characterized by an uptick in proof-of-concept, pilot, and channel partnerships that we believe will convert into recurring revenue in the second half of 2024 with acceleration in 2025. Finally, turning to Ben's financial strategy, we remain focused on building market momentum, scaling the platform, improving access to efficient capital and liquidity and cost distribution. In summary, we remain focused on bringing AI solutions that deliver real benefits to our B2B2C customers. Driving CX Productivity and Performance.
Bill Williams: Q2 2024 saw the initial stages of Ben's
Ben: and Ongoing Market Momentum, characterized by an uptick in proof-of-concept, pilot, and channel partnerships that we believe will convert into recurring revenue in the second half of 2024 with acceleration in 2025.
Ben: Finally, turning to Ben's financial strategy, we remain focused on building market momentum, scaling the platform, improving access to efficient capital and liquidity, and cost discipline.
Speaker Change: In summary, we remain focused on bringing AI solutions that deliver real benefits to our B2B2C customers, driving CX productivity and performance.
Bill Williams: Q2 featured Building Momentum Through Operationalizing Our Platform, Successfully Productizing AI Assistance, Expanded Customer and Partnership, and POCs in market and attracting capital. For the remainder of 2024, our focus will continue to be on performance, execution, and converting pilot programs into revenue and enhanced liquidity. Operator?
Speaker Change: Q2 featured building momentum through operationalizing our platform, successful productizing AI assistance,
Speaker Change: Expanded Customer and Partnerships.
Speaker Change: and POCs in market and attracting capital.
Speaker Change: For the remainder of 2024, our focus will continue to be on performance, execution, and converting pilot programs into revenue and enhanced liquidity. Now I'd like to turn it over to the operator for Q&A. Operator?
Operator: Thank you. As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again, stand by while we compile the Q&A roster. Our first question comes to the line of Jack van der Aarde from Maxim.
Speaker Change: Thank you. As a reminder to ask a question, please press star 1 1 on your telephone and wait for your name to be announced.
Speaker Change: To withdraw your question, please press star 11 again.
Speaker Change: Please stand by while we compile the Q&A roster.
Speaker Change: Our first question comes to the line of Jack Van Der Aarde from Maxim Group.
Jack van der Aarde: Okay, great. I appreciate the 2Q update, guys. And nice to hear from Paul and Bill and Ryan and also to meet your new AI assistant Sky. Um, so I'll start with a question, though, for Paul.
Jack Vanderard: Okay, great. I appreciate the 2Q update, guys, and nice to...
Jack Vanderard: It's nice to hear from Paul and Bill and Ryan and also to meet your new AI assistant, Sky. So I'll start with a question though for Paul. Paul, you guys have made a lot of progress recently on all these various pilot programs and proof of concepts in healthcare and automotive.
Jack van der Aarde: Um, Paul, you guys have made a lot of progress recently on all these various pilot programs and proof of concepts in healthcare and automotive, and I think you have some other, you know, maybe industrial and consumer applications ongoing as well or targeting. Can you maybe just touch on some of the specific ones, maybe like how would you rank them in order of what are the closest ones to being commercialized in your view and which are kind of like the bigger opportunities or whatever you want to talk about it? It's just that there are so many interesting pilots going on.
Speaker Change: and I think you have some other, you know, maybe industrials and consumer applications ongoing as well or targeting. Can you maybe just touch on some of the specific ones, maybe like, how would you rank these in order of what are the closest ones to being commercialized?
Speaker Change: in your view and in which are kind of like the bigger opportunities or however you want to talk about it, it would be it's just there's so many interesting pilots going on. I just think let you kind of zone in on a couple maybe for example of the ones you think are ready to be commercialized at some point. Thank you.
Paul Chang: I'm just going to let you kind of zone in on a couple, maybe for example, of the ones you think are ready to be commercialized at some point. Thank you. But thanks, Jack, and great to chat with you here. So I would say, you know, as you saw in our developments of new commercial opportunities. So far, we've had quite a bit of progress and advancement in the healthcare sector.
Speaker Change: Thanks, Jack, and great to chat with you here.
Speaker Change: So I would say, you know, as you saw in our, you know, developments of new commercial opportunities, so far we've had quite a bit of progress and advancement in the health care space.
Paul Chang: And, you know, one of our Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network companies that are struggling with especially skilled workers, as in in health care, and what we're seeing is companies testing the technology. And, you know, I would say they're testing it rather thoroughly because, you know, there's been some missteps out there with other gen AI solutions companies. And so they're being, you know, somewhat methodical and cautious.
Speaker Change: And, you know, one of our pieces in developing our AI assistance was that we needed to help those industries that are struggling with resources.
Operator: 2nd Quarter, 2024 Earnings Call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be an analyst question and answer session. Please be advised that today's conference is being recorded.
Speaker Change: especially skilled resources as in health care.
Speaker Change: and what we're seeing is companies testing the technology and, you know, I would say they're testing it rather thoroughly because, you know, there's been some missteps out there with other, you know, Gen AI solutions companies.
Ryan Flanagan: I would now like to hand the conference over to Brand Engagement Network Investor Relations, Ryan Flanagan. Please go ahead. Thank you.
Paul Chang: But I would say in the healthcare space, we are on the cusp of, you know, being able to deploy with a larger footprint than just doing pilot. In the automotive space, you know, we're still working with some of our key partner, in, you know, identifying the use cases as well as, you know, building pilots. So the dealership that was mentioned by Bill, they're essentially our joint development partner to ensure that the technology meets their needs. And indeed, it is providing the functionality that they're, Okay, got it. I appreciate that color.
Ryan Flanagan: Hi everyone and thanks for joining our Q2 Earnings Conference call. Joining me on the call today are Paul Chang, our co-CEO, Bill Williams, our CFO, and Sky, our AI-powered assistant. By now, everyone should have access to our Earnings announcement. This announcement is also available on our Investor Relations website.
Speaker Change: and so they're being, you know, somewhat methodical and cautious, but I would say in the healthcare space, we are on the cusp of, you know, being able to deploy with a larger footprint than just doing pilots.
Speaker Change: In the automotive space, you know, we're still working with some of our key partner.
Ryan Flanagan: During this call, we'll make four looking statements, including statements about our business outlook, strategies, and long-term goals. These comments are based on our plans, predictions, and expectations as of today, which may change over time. Our actual results could differ materially due to a number of risks and uncertainties. For more information about the risks and uncertainties involving forward-looking statements, and factors that could cause actual results to differ materially from those projected or implied by forward-looking statements, please see the risk factors set forth on our most recent annual report on Form 10K as supplemented by the risk factors in our most recent quarterly report on Form 10Q. Forward-looking statements, represent management's current estimates, and the company assumes no obligation to update any forward-looking statements in the future.
Speaker Change: in identifying the use cases as well as building pilots.
Bill Williams: The dealership that was mentioned by Bill, there essentially are showing development partner to ensure that the technology meets their needs, and indeed it is providing the functionality that they're looking for.
Jack van der Aarde: And maybe just a follow up there in the automotive vertical, as your reseller partner, your exclusive reseller partner in that vertical, that relationship's been, I think, ongoing now for a couple quarters. So I imagine there has been some time that's passed, and you've been able to get some feedback, I'm sure, and have things being tested out. What are some general takeaways you're hearing from potential dealership customers that that automotive partner is working with already? What are you hearing from those end customers? Are they receptive?
Speaker Change: Thank you so much for watching this video.
Speaker Change: Okay, got it. I appreciate that color. And maybe just a follow-up there in the automotive vertical, as your reseller partner, your exclusive reseller partner in that vertical, that relationship's been, I think, ongoing now for a couple quarters.
Ryan Flanagan: And finally, this call and the entirety is being webcasts from our Investor Relations website at www.investors.binink.ai. And an audio replay will be available on our website in a few hours.
Speaker Change: So I imagine there has been some time that's passed, and you've been able to get some feedback, I'm sure.
Speaker Change: have things being tested out. What are you, what are some general takeaways you're hearing from, you know, potential?
Ryan Flanagan: With that, I'd like to turn the call over to Paul. Paul?
Speaker Change: dealership customers that that automotive partner is working with already. What are you hearing from those end customers? Are they receptive? Is there a real need? I'd just be curious to hear kind of tone of those discussions and what you're hearing.
Paul Chang: Is there a real need? I'd just be curious to hear the tone of those discussions and what you're hearing.
Paul Chang: Thank you, Ryan, and thank you all for joining us today. I'm pleased to report that in the second quarter, we've made continued progress on market validation initiatives with meaningful acceleration in new proof-of-concepts and the maturation of earlier engagements into production-ready deployments.
Paul Chang: So the customers are all more than receptive, I would say they're excited about the potential of AI technology enhancing their customer experience, and perhaps driving more efficiency to their dealers. They are seeing how the technology can augment their existing staff and be able to take on sort of the more of the administrative tasks. Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, So they're excited. And we look forward to you know, launching some of the use cases, with a handful of pilot dealerships, based on the data that they're able to provide our AIC. So, so far, all signs are good.
Speaker Change: Sure, yes. So the customers are all more than receptive. I would say they're excited about the potential of AI technology enhancing their customer experience and perhaps driving more efficiency to their dealerships.
Paul Chang: Further, we have taken incremental steps to improving our liquidity and capital position, successfully closing a private placement in May, providing us funding over time. We continue to closely manage our internal costs to ensure our business is built for growth and to last for the long term.
Speaker Change: They are seeing how the technology can augment their existing staff and be able to take on sort of the more of the administrative tasks.
Paul Chang: Reflecting the production-ready nature of our platform, we are thrilled to introduce Sky, one of Ben's AI assistants, who is here to demonstrate her domain expertise and participate on our earnings call. Data from business and technology sections of Ben's Investor presentation and selected few SEC filings have been ingested. Sky also brings knowledge of our key partners as well as statistics on healthcare challenges and ramifications.
Speaker Change: leaving the current staff members to be able to provide a better customer service and better customer experience.
Speaker Change: So they're excited
Speaker Change: and we look forward to you know launching some of the use cases with a handful of pilot dealerships based on the data that they are able to provide our AI systems.
Paul Chang: Before discussing our results and key business developments in greater detail, I wanted to take a moment to discuss recent organizational changes. In May, I was appointed co-CEO with responsibility for Ben's commercial business and oversight of day-to-day operations. Solutions. My near-term focus is twofold. Driving market validation of our differentiated solutions, and meaningful revenue through the conversion of POCs into scale deployments. Asco CEO, Michael Zacharski is focused wholly on advising our Board of Directors on inorganic growth opportunities and our M&A strategy, which we view as key component of our go-to-market strategy.
Speaker Change: So, so far all signs are good. We need to just take the next steps in order to be able to deliver on the promise of generative AI.
Jack van der Aarde: We need to just take the next steps in order to be able to deliver on the promise of generative AI. Gotcha. And, you know, maybe I have two more questions.
Jack van der Aarde: I'll ask a question for Bill afterwards, just about the operating expense line items. So, but first, before I do that, Paul, maybe just one more question in terms of these six proof of concepts arrangements you have going on, and the arrangement you have with your auto partner. You know, the AI space is obviously a very competitive market, obviously. So the fact you've entered these six proof of concept arrangements, can you just talk about, you know, I don't know if you could share anything specific about maybe MedAdvisor or AFG, or just in general. How were they actively, did you compete against other competitors? How did you win these arrangements? Just where do you stack competitively?
Speaker Change: Gotcha. And, you know, maybe I have two more questions. I'll ask a question for Bill afterwards, just about the operating expense line items. So, but first, before I do that, Paul, maybe just one more question in terms of
Paul Chang: These six proof-of-concepts arrangements you have going on and the arrangement you have with your auto partner
Paul Chang: Um, um,
Speaker Change: You know, the AI space is obviously a very competitive market, obviously. The fact that you've entered these six proof-of-concept arrangements...
Speaker Change: Can you just talk about, you know, I don't know if you could share anything specific about maybe MetAdvisor or AFG or just in general, how,
Paul Chang: Now to discuss progress we made across several fronts in the second quarter. To start, we are seeing continued momentum in customer expansion. We call in our previous earnings call, we highlighted two POCs. We are pleased to see an acceleration in the second quarter to six POCs with an early read of the Q3 pipeline and an opportunity funnel suggesting that this number will continue to increase in the second half of the year.
Paul Chang: And why did these these brands ultimately choose you for a pilot program, and then I'll move on to a question for Bill. Sure, sure. So I would assume we are always, Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network. Whereas, I think for Ben, we don't have to pretend because we know we are a true full-stack AI company. We have the front end, the middleware, and the backend, including our large language model.
Speaker Change: Are they actively, did you compete against other competitors? How did you win these arrangements? Just where do you stack competitively? And why did these these these brands ultimately choose you for a pilot program and then I'll move on to the question for Bill. Thanks.
Speaker Change: Sure, sure. So I would assume we are always competing because there are lots of, you know, quote unquote, AI companies out there.
Paul Chang: We announced our attainment of HIPAA compliance early in Q2, underscoring our commitment to protecting patient healthcare information and fast tracking our ability to operate into healthcare vertical.
Speaker Change: You know, many of those companies are just a thin veneer on top of, you know, public large language models like chat GPT, but they are, you know, posing as a true AI companies.
Paul Chang: Further demonstrating our data security and privacy focus, we have also paying soft to type one certification, ensuring that third-party services providers store and process client data in a secure fashion. Our partnership pipeline remains robust with several notable announcements in the quarter.
Speaker Change: Whereas I think for
Speaker Change: then we don't have to pose because we know we are a true
Speaker Change: Full Stack AI Company. We have the front end, the middleware, and the back end, including our large language model.
Paul Chang: So we are able to configure our AI systems; we are able to tailor them to solve very specific problems for specific customers. So, as an example, the solution that we've launched with Medivisor has to do with addressing vaccine hesitancy, and we know this is a large problem facing not just the US population but globally.
Speaker Change: So we are able to configure our AI system, we are able to tailor it to solve very specific problems for specific customers.
Paul Chang: First, we announced a pilot collaboration with the skills, acquisition and innovation laboratory or sale. Collaborating with an industry thought leader, such as New York Presbyterian Hospital and Cornell Medical College provides spend with significant domain expertise as well as access to an innovation lab where breakthrough technology can be tested and validated.
Speaker Change: as an example, the solution that we've launched with Metabizer.
Speaker Change: It has to do with addressing vaccine hesitancy. And we know this is a, you know, large problem facing not just the US population, but globally.
Jack van der Aarde: And it takes a lot of resources and manpower to answer questions and address different needs from different patients. So having a AI system that's, you know, Unknown Speaker, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, Unknown Speaker, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, Unknown Speaker, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, Unknown Speaker, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, Unknown Speaker, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, I credit that to our full control over the various different components that makes AI run and be able to configure to deliver a safe and secure interaction with, Okay, great. That's really helpful, Collar. Very interesting. You know, and then let me switch gears.
Speaker Change: And it takes a lot of resources and manpower to answer questions and, you know, address different needs from different patients.
Paul Chang: Second, we are excited to expand our partnership with Medivisers Solutions, which was announced just this past Tuesday. The expansion includes a commercial solution offering by Medivisers on educating and addressing vaccine hesitancy among the patient population.
Speaker Change: So having a AI system that's, you know,
Speaker Change: Essentially infinitely scalable to meet the needs of the consumers and the patients, be able to describe the benefits and you know potential side effects, address them you know beforehand.
Paul Chang: Ben's AI assistance are designed not only to engage consumers, but to complete tasks, such as filling out necessary forms and scheduling appointments. The joint offering is scheduled to be launched at the National Chain Drug Store Association's Total Store Expo Conference in Boston on August 18th and 19th.
Speaker Change: That is essentially a game changer in the healthcare market specifically in the in the vaccines world.
Speaker Change: So, we know that we are competing.
Speaker Change: against others, but the feedback that we've gotten...
Paul Chang: Third, we have announced a commercial agreement with Vibro, a company that connects brands with customers through innovative audio messaging strategies.
Speaker Change: is most customers have not seen anything like our technology, just as you just saw on the video, they have not seen anything remotely close to that from some of the other AI providers. And again, I...
Paul Chang: Together, we are collaborating to merge Ben's proprietary AI assistant technology with Vibro's audio and radio communication technology to enable interactive consumer engagement for brands.
Speaker Change: I credit that to our full control over the various different components that makes AI run and be able to configure to deliver a safe and secure interaction with consumers.
Paul Chang: There's perhaps no better way to illustrate the readiness of our platform than to have a natural conversation with one of our AI assistants, Sky. We would like to mention that Sky is using Ben's proprietary, large language model, retrieval, augmented generation, and for this application, presenting in life-size proportions.
Bill Williams: I'll ask Ben a question on the financial side, maybe on the operating expenses, just trying to get a sense here because the business is still obviously in a very early stage. And I'm just trying to get a sense of how the 2Q operating expense levels kind of compare to maybe your expectations for the next couple quarters going forward, just to get a sense of how much of this is noise from, you know, the merger and how much of this is normalized.
Collar: Okay, great. That's really helpful, Collar. Very interesting.
Speaker Change: You know, and then let me switch gears. I'll ask a question.
Speaker Change: and Ben maybe on the financial side. Operating expenses, just trying to get a sense here because the business is still obviously very early stage.
Paul Chang: Thank you, everyone, for joining. I am standing here at Sail, which is an innovative lab that sits in the intersection of Cornell Medical College, New York Presbyterian Hospital, and the industry to provide world-class leading-edge educational training for clinicians so that they can provide enhanced customer care for all patients. I'm standing here because we have our AI assistant deployed to aid in that educational curriculum. I'd like to describe this deployment, because most likely your experience with AI has been on a phone or maybe on a little screen.
Speaker Change: I'm just trying to get a sense of how the 2Q operating expense levels kind of compares to maybe
Speaker Change: your expectations for the next couple of quarters going forward, just to get a sense of how much of this is noise from the merger and how much of this is normalized. Thanks, Bill.
Bill Williams: Thanks, Bill. Thank you, Jack. I appreciate the question. I would say, second quarter, especially compared to Q1, I think Q1, I mean, did have a lot of movement that was driven around the transaction. Transaction costs, we had a little bit of that that led over into the quarter Q2, but I think our run rate now is probably more reflective of our, our, our go forward. And so most of the, the, the op ex that that we experienced, basically, we were essentially flat kind of sequentially and so that's going to be the blend of.
Speaker Change: Thank you, Jack. I appreciate the question. I would say second quarter, especially compared to Q1, I think Q1, I mean, did have a lot of movement that was driven around the transaction and
Speaker Change: Transaction Costs. We had a little bit of that that
Speaker Change: led over into the corner, Q2, but I think
Speaker Change: Our run rate now is probably more reflective of our, our, our go forward. And so most of the, the, the op ex that that we experienced, basically, we were essentially flat kind of, and so that's going to be the blend of.
Paul Chang: What you see here is a life-size representation of our AI assistant that is actually being run by a small computer behind this monitor. So everything you see is being run locally because we know certain industries having on-prem deployment is critical to ensuring safety and privacy of the data that is being utilized at this facility. Now, we can still run cloud-based solutions, but always having an option to run locally, we believe, gives an advantage.
Bill Williams: Kind of a drop off in transaction expenses, and then we also did have some increases as we started productionizing our systems and getting ready to kind of put those in the market during the second half of the year. We also benefited from being able to convert.
Speaker Change: kind of a drop off of transaction expenses. And then we also, you know, did have some increases as we started productionizing our systems and getting ready to kind of put those in market the second half of the year. We also benefited from being able to convert
Bill Williams: Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, Unknown Attendee, Jack Aarde, Michael Zacharski, William Williams, Brand Engagement Network, Okay, that's really, really helpful caller makes sense there, too. Okay, I think that's it for me, guys. I appreciate the the update and congrats on the strong momentum. Look forward to tracking the story.
Speaker Change: Some transaction expenses that that kind of float from the acquisition.
Speaker Change: that got renegotiated down. We got the benefit of that. And so that's kind of out of our.
Michael Zacharski: Michael Zacharski
Paul Chang: Now, enough from me, let me introduce you to our AI assistant, Sky. Hey, Sky, can you tell me a little bit about brand engagement network and what makes their technology different?
Speaker Change: are employment costs and you know, for our staff as we.
Michael Zacharski: Start commercializing products and
Michael Zacharski: Very, very little of transaction related costs. We did have an uptick and depreciation and amortization as
Sky: Hi there. Brand engagement network or Ben is an innovative company specializing in conversational AI assistants. What sets us apart is our focus on security and personalization. Our AI assistants are built on proprietary NLP, allowing for human-like interactions, and they're designed to be industry-agnostic, making them versatile for various sectors like automotive and healthcare. Plus, we ensure our AI assistants only provide information from validated datasets, preventing hallucinations and maintaining data reliability.
Michael Zacharski: We actually shifted from R&D to actually putting solutions in market because of the POCs. Those are now operationalized, so there's an uptick in depreciation and amortization just flowing from that.
Speaker Change: So I would say this run rate is probably more reflective of what we'll see second half of the year and, you know, with adequate funding and all that, we'll start building.
Speaker Change: Capabilities, I would say investing more in things like our commercial team, our sales team is in go to market team as we start expanding the second half of the year. You'll see that as kind of an investment.
Sky: Sky, can you tell me a little bit about our partner, MedAdvisor? MedAdvisor Solutions is a global leader in pharmacy-driven patient engagement. They work with over 37,000 pharmacies worldwide to provide personalized patient experiences, simplifying medication journeys.
Speaker Change: more of an investment profile as we go forward.
Speaker Change: Okay, that's a really helpful call. It makes sense there too. Okay, I think that's it for me guys. I appreciate the update and congrats on the strong momentum. I look forward to tracking the story.
Sky: Their dated, driven approach and innovative digital experiences empower pharmacies and drive lasting behavior change. Why is medication adherence so important in treating chronic conditions? Medication adherence is crucial for managing chronic conditions because it helps prevent complications and hospitalizations. Around 70% of Americans with chronic diseases struggle with taking their meds as prescribed leading to about 125,000 deaths and $630 billion in a necessary cost globally each year.
Operator: Thank you, Jack. Thank you. At this time, I am not showing any further questions. I would like to turn the conference back over to Paul Chang for closing remarks.
Jack Vanderard: Thank you, Jack.
Speaker Change: Thank you. At this time, I am showing no further questions. I would now like to turn the conference back over to Paul Chang for closing remarks.
Paul Chang: Thank you, Gigi. I want to just thank everyone for joining this call. I hope it was informative and perhaps even entertaining. And we will talk to you guys next. This concludes today's conference call. Thank you for participating. You may now disconnect.
Paul Chang: Thank You Gigi. I want to just thank everyone for joining this call. I hope it was informative and perhaps even entertaining and we will talk to you guys next quarter.
Speaker Change: This concludes today's conference call. Thank you for participating. You may now disconnect.
Sky: Sky, what are some automotive use cases?
Sky: We're currently exploring automotive use cases for our AI assistance. One potential application is an incur assistance that provides real-time traffic updates, navigation assistance and vehicle maintenance reminders. We're also looking into our driven customer support for automotive dealerships.
Sky: Sky, are you able to deliver our financial results for a second quarter? For financial matters, I will hand it over to our CFO Bill Williams who is in charge of finances.
Bill Williams: Thanks, Sky.
Bill Williams: Take it away, Bill.
Bill Williams: Thank you, Sky, and thanks everyone for joining us. I appreciate the opportunity to provide an update on Ben's financial progress. Our Q2 and year-to-date results reflect Ben's continued focus on laying the foundation for future growth. Product and solutions development, the continued build-out and productionizing of our infrastructure, developing talent, and expanding partnerships and initial customer relationships. While quarter and year-to-date book revenue was minimal, we saw expanded proof-of-concept, pilot, and partnership activity gaining momentum.
Bill Williams: Notably, a 3X expansion in PLCs and channel partnerships since the first quarter. These include notable wins, such as value technologies, sale, the Cornell University Medical Center's Innovation Center, members-only health network, intervent health, vibru, and a Northwest Indiana Card Dealership in the important automotive vertical. Our year-to-date financial performance reflects R&D costs associated with the continued build-out of Ben's capabilities, and multiple product introductions since our second half, 2023 DM Labs acquisition, plus transaction costs from the Q1-2024 merger, partially offset by positive impact of cost actions and discipline, which drove sequential operating loss improvement.
Bill Williams: The quarter also benefited from a recognized gain on extinguishment of combination-related liabilities, of $1.8 million through the negotiated settlement of accounts payable. Q2-2024 saw the initial stages of Ben's transition from a pre-revenue enterprise, an ongoing market momentum characterized by an uptick and proof-of-concept, pilot, and channel partnerships that we believe will convert into recurring revenue in the second half of 2024 with acceleration in 2025. Finally, turning to Ben's financial strategy, we remain focused on building market momentum, scaling the platform, improving access to efficient capital and liquidity and cost discipline.
Bill Williams: In summary, we remain focused on bringing AI solutions that deliver real benefits to our B to B to C customers, driving CX productivity and performance. Q2 featured building momentum through operationalizing our platform, successful productizing AI assistance, expanded customer and partnerships and POCs in market and attracting capital. For the remainder of 2024, our focus will continue to be on performance, execution and converting pilot programs into revenue and enhanced liquidity.
Operator: Now I'd like to turn it over to the operator for Q&A. Operator? Thank you. As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by when we compile the Q&A roster.
Jack Vanderard: Our first question comes to the line of Jack Vanderard from Maxim Group. Okay, great.
Jack Vanderard: I appreciate the two key update, guys, and nice to hear from Paul and Bill and Ryan and also to meet your new AI system, Sky. So start with a question, though, for Paul. Paul, you guys have made a lot of progress recently on all these various pilot programs and proof of concepts in healthcare and automotive. And I think there's some other, you know, maybe industrial and consumer applications on going as well, or targeting.
Jack Vanderard: Can you maybe just touch on some of the specific ones? Maybe like, how would you rank these in order of what are the closest ones to being commercialized in your view or in which are kind of like the bigger opportunities or however you want to talk about it? It would be, it's just, there's so many interesting pilots going on. I just think, let you kind of zone in on a couple maybe, for example, of the ones you think are ready to be commercialized at some point.
Paul Chang: Thank you. Thanks, Jack, and great to chat with you here. So I would say, you know, as you saw in our, you know, developments of new commercial opportunities. So far, we've had quite a bit of progress and advancements in the healthcare space. And you know, one of our pieces in developing our AI assistance was that we needed to help those industries that are struggling with resources, especially skilled resources as in healthcare.
Paul Chang: And what we're seeing is companies testing the technology and, you know, I would say they're testing it rather thoroughly because, you know, there's been some missteps out there with other, you know, gen AI solutions companies. And so they're being, you know, somewhat methodical and cautious, but I would say in the healthcare space, we are on the cusp of, you know, being able to deploy with a larger footprint than just doing pilots.
Paul Chang: In the automotive space, you know, we're still working with some of our key partner in, you know, identifying the use cases as well as of, you know, building pilots. So the dealership that was mentioned by Bill, they're essentially our joint development partner to ensure that the technology meets their needs. So they're looking for.
Paul Chang: Okay, got it. I appreciate that color and maybe just a follow up there in the automotive vertical, as your reseller partner, your exclusive reseller partner in that vertical. That relationship's been I think ongoing now for a couple quarters. So I imagine there has been some time that's passed and you've been able to get some feedback. I'm sure and have things being tested out. What are you, what are some general takeaways you're hearing from, you know, potential dealership customers at that that that that automotive partner is working with already. What are you hearing from those end customers? Are they, are they receptive? Is there a real need? I just be curious to hear kind of tone of those discussions and what you're hearing.
Paul Chang: Sure, yes. So the customers are all more than receptive. I would say they're excited about the potential of AI technology enhancing their customer experience and perhaps driving more efficiency to their dealerships. They are seeing how the technology can augment their existing staff and be able to take on sort of the more of the administrative past, leaving the the current staff members to be able to provide a better customer service and better customer experience.
Paul Chang: So they're excited and we look forward to launching some of the use cases with a handful of pilot dealerships based on the data that they're able to provide our AI systems. So so far all signs are good. We need to just take the next steps in order to be able to deliver on the promise of generative AI.
Paul Chang: Gotcha. And you know, maybe I have two more questions. I'll ask a question for Bill afterwards. Just about the operating expense line items. But first before we do that, Paul, maybe just one more question in terms of these these six proof of concepts arrangements you have going on and the the arranger you have with your auto partner. You know, the AI space is obviously a very competitive market, obviously. So the fact you've entered the six perfect concept arrangements.
Paul Chang: Can you just talk about, you know, I don't know if you could sit, share anything specific about maybe meta visor or AFG or just in general. How are they actively, did you compete against other competitors? How did you win these arrangements? Just where do you stack competitively? And why did these these brands ultimately choose you for a pilot program?
Paul Chang: And then I'll move on to the question for Bill. Thanks. Sure, sure. So I would assume we are always competing because there are lots of you know quote-unquote AI companies out there. You know, many of those companies are just a thin veneer on top of, you know, public, large language models like chat GPT. But they are, you know, posing as a true AI companies. Whereas I think for then, we don't have to pose because we know we are a true full stack AI company.
Paul Chang: We have the front end, the middleware, and the back end, including our large language model. So we are able to configure our AI systems. We are able to tailor it to solve very specific problems for specific customers. So as an example, the solution that we've launched with metadata. The user has to do with addressing vaccine hesitancy. And we know this is a, you know, large problem facing not just the US population, but globally.
Paul Chang: And it takes a lot of resources and manpower to answer questions and, you know, address different needs from different patients. So having a AI system that's, you know, essentially infinitely scalable to meet the needs of the consumers and the patients, be able to describe the benefits and, you know, potential side effects addressed them beforehand. And that is essentially a game changer in the healthcare market, specifically in the vaccines world. So we know that we are competing against others, but the feedback that we've gotten is most customers have not seen anything like our technology, just as you just saw on the video.
Paul Chang: They have not seen anything remotely close to that from some of the other AI providers. And again, I credit that to our full control over the various different components that makes AI run and be able to configure to deliver safe and secure interaction with consumers.
Jack Vanderard: Okay, great. That's really helpful color. Very interesting.
Jack Vanderard: You know, and then let me switch gears.
Jack Vanderard: I'll ask a question to Ben maybe on the financial side. Operating expenses, just trying to get a sense here because the business is still obviously very early stage. And I'm just trying to get a sense of how the two Q operating expense levels kind of compares to maybe your expectations for the next couple quarters going forward just to get a sense of how much of this is noise from, you know, the merger and how much of this is normalized.
Bill Williams: Thanks Bill. Thank you Jack. I appreciate the question. I would say second quarter, especially compared to Q one. I think Q one means did have a lot of movement that was driven around the transaction and transaction costs. We had a little bit of that that went over into the quarter to two, but I think our run rate now is probably more reflective of our our go forward. And so most of the, the, the op-X that that we experienced basically, we were essentially flat kind of sequentially.
Bill Williams: And so that's going to be the blend of kind of a drop off of transaction expenses. And then we also, you know, did have some increases as we started productionizing our assistance and getting ready to kind of put those in market the second half of the year. We also benefited from being able to convert some transaction expenses that that kind of flow from the acquisition that we got renegotiated down. We got the benefit of that.
Bill Williams: And so that's kind of out of our kind of normal run rate. So I guess overall, I would say we are closer to having kind of a normalized operating range, which is really going to reflect our employment costs and, you know, for our staff as we start commercializing products and very, very little of transaction related costs. We did have an uptick and depreciation and amortization is we actually a shifted from R and D to actually putting solutions in market because because of the POCs.
Bill Williams: Those are now, you know, operationalized. So there was an uptick and depreciation and amortization just for what going from that. So I would say this run rate is probably more reflective of what we'll see second half of the year and, you know, with adequate funding and all that, we'll start building, and capabilities, I would say investing more in things like our commercial team, our sales team is in go-to-market team as we start expanding the second half of the year, you'll see that as kind of an investment, more of an investment profile as we go forward.
Jack Vanderard: Okay, that's really helpful, Caller, makes sense there too.
Jack Vanderard: Okay, I think that's it for me guys, I appreciate the update and congrats on the strong momentum before the track on the story. Thank you, Jack. Thank you.
Operator: At this time, I'm showing no further questions.
Paul Chang: I would now like to turn the conference back over to Paul Chang for closing remarks. Thank you, Gigi. I wanted to thank everyone for joining this call.
Paul Chang: I hope it was informative and perhaps even entertaining, and we will talk to you guys next quarter.
Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.