Parsing the wording and revising the numbers makes me suspect that the software business itself has very little legs. It strikes me personally that the SaaS business has been emphasised over other elements of the group not because of its success but rather its sexiness.
Sell Lease Property seems to be the main business, generating $6.5m of the group's $8m. With 180 agents, that's a tick over $36k revenue per agent... a number that just cries for further explanation. It also means that all the other businesses are splitting the last $1.5m in revenue. If that is the case, why do the website and the opening pages of the prospectus so heavily emphasize the software and outsourced services arm?
As far as I can tell from reading the prospectus a couple of times, nearly all the software tools have been developed in-house for their own teams and they now have the intention of selling these tools to other Real Estate companies.
Further revenue figures (it's not clear to me if these fall under the $6.5m of Sell Lease Property or are separate)
- Propery management $0.28m
- Conveyancing $0.29m
- Mortgage Financing $0.29m
Try Googling any of their software products and literally nothing can be found. Meanwhile their REAP Design business has literally 4 likes on Facebook and the entire portfolio is generic dummy work:
http://www.reapdesign.com.au/portfolio.html
In fact, I can't find revenue figures for any of their many, many software concepts. It just seems like an alphabet soup... an orgy of late-night ideas with little follow-through or traction.
Given that the Real Estate business seems doomed to never be profitable (just look at the YoY results - employee benefits tracks at 90%+ of expenses consistently every single year), it's hard to imagine what kind of 'business' this actually is.
I'm genuinely confused. I've read this prospectus several times and see literally nothing in this business that warrants excitement, but then again, I've never invested in a cent in the share market and am just reading all these prospectuses for research purposes. Anyone want to enlighten?
