AI Tokens, Data Demand, and the Small Cap Opportunity

Artificial intelligence is no longer confined to research labs or theoretical discussions, it’s already reshaping global industries. At the core of this revolution are AI tokens, units of data that fuel the training and operation of AI models. In a recent report from Microsoft, it was revealed that over 100 trillion tokens were processed last quarter, with a record 50 trillion in April alone, a fivefold increase year-on-year.

This surge isn’t just about bytes and bandwidth. It’s about real commercial opportunity. As AI adoption explodes, companies that produce, process, and monetise data at scale are in high demand. While tech giants like Microsoft and Google dominate headlines, there is a growing cohort of AI-driven small-cap stocks on the ASX that are quietly positioning themselves to benefit from this tectonic shift.

In this piece, we spotlight three ASX-listed businesses, AI Media, Straker Translations, and Pure Profile, which we believe are well placed to ride the AI token boom. These are real, profitable companies with strong management, clear strategies, and untapped upside.

AI Media: Reinventing Captioning with a SaaS DNA

AI Media, once a traditional live captioning business, is undergoing a remarkable reinvention. Its mission: to transform into a scalable, SaaS-first AI media solutions provider. That pivot is already underway, with half of its current revenue now coming from technology-based products.

The company’s new AI-driven product suite, Lexi Captions, Lexi Voice, and Lexi Brew, is the engine of that transformation. Launched in April, Lexi Voice helps move the company away from hardware-based revenue toward recurring high-margin SaaS income.

AI Media commands an 80% market share in U.S. live broadcasting and is actively expanding into new verticals, courtrooms, classrooms, and lecture theatres, as well as geographies, particularly Europe and APAC. Management is aiming for $150 million in revenue by FY29, with Lexi products expected to drive 80% of that.

Strategic joint ventures, encoder acquisitions, and partnerships with global distribution networks could further accelerate growth. With a strong balance sheet and founder-led leadership, AI Media is one of the few AI-driven small-cap stocks in Australia with proven product-market fit and visible long-term growth levers.

Straker Translations: AI-Powered Language at Scale

Straker Translations, a New Zealand-based company with a 25-year legacy, is also undergoing its own evolution. Once a traditional services business, Straker is now focused on selling AI translation tools powered by its proprietary datasets. In the AI world, data is the currency, and Straker has plenty of it.

The company’s competitive edge lies in its ability to create and validate customer-specific AI language models. This is made possible through its crowd-sourced network of 100,000 freelancers and a highly valuable historical dataset built over decades. Straker’s Verify AI product adds an extra layer of transparency, offering both automated and human-validated outputs.

One of the most exciting near-term catalysts is its Swift Bridge AI initiative in Japan. With new government mandates requiring English-Japanese financial translations for 2,000 listed companies, this program alone could unlock a significant revenue channel.

Trading at just 0.5x revenue, and with strong balance sheet backing, Straker looks undervalued. The company is also pushing hard on ecosystem development, aiming to lock in 100 partnerships within six months. In a market that’s expected to consolidate rapidly, Straker stands out as a future-ready player with real operating leverage.

Pure Profile: Fuelling AI with First-Party Data

Pure Profile is a lesser-known ASX-listed company that specialises in AI-powered insights and data solutions. The company collects first-party data via proprietary platforms and sells this to governments, brands, and other organisations for decision-making.

In the first half of FY25, Pure Profile generated $29.2 million in revenue (22% growth YoY) and $1.6 million in net profit. More importantly, it’s now targeting the UK and U.S. markets, 5x and 30x the size of Australia, respectively, where the appetite for data is surging.

One of the most innovative parts of its business is avatar-based video surveys, allowing companies to interact with synthetic respondents and dramatically reduce cost and turnaround time. Beyond that, Pure Profile is exploring synthetic data products, a space likely to become a foundational input in the training of large AI models.

With EBITDA forecast at $7 million next year and a market cap of only $50 million, Pure Profile looks like a high-growth AI token enabler trading at a discount. M&A opportunities, particularly in the UK and Southeast Asia, could help accelerate its expansion.

Why AI Tokens Matter for Small Caps

The rise of AI tokens isn’t a niche story, it’s a structural shift in how digital value is created and consumed. AI models live on data, and the companies producing or organising that data, whether via transcription, translation, or insight generation, sit on a new kind of digital infrastructure.

Microsoft’s 100 trillion-token milestone is a preview of what’s coming. While the mega caps will always have their place, small agile players with domain expertise and a clear use case can deliver outsized returns.

From SaaS-led captioning to high-value translation models and data monetisation platforms, the three companies we’ve covered, AI Media, Straker, and Pure Profile, aren’t just tagging along for the AI ride. They’re building the tracks.

TAMIM Takeaway: Betting on the Infrastructure Behind AI

At TAMIM, we are drawn to the enablers, the picks and shovels that support the next wave of growth. The rise of AI tokens and the companies operationalising them offer precisely that opportunity.

AI Media is building a SaaS flywheel in content accessibility. Straker Translations is turning its legacy data into an AI translation advantage. Pure Profile is feeding AI’s insatiable demand for structured data.

Each of these businesses shares the following common traits:

• Founder-led
• Profitable or near break-even
• Operating with strong balance sheets
• Trading at a meaningful discount to intrinsic value

For investors looking to play the AI trend beyond the crowded mega cap space, these AI-driven small-cap stocks represent a compelling thematic. As always, do your homework, monitor upcoming catalysts (including earnings updates), and size your positions accordingly.

The AI arms race isn’t slowing down. These are the companies helping to fuel it.

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Disclaimer: AI-Media Technologies (ASX: AIM), Straker Limited (ASX: STG) and Pure Profile Limited (ASX: PPL) are held in TAMIM Portfolios as at date of article publication. Holdings can change substantially at any given time.