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Online Support a Capital Idea

  • By Emily Piesse

While securing venture capital remains a challenge for many in the state’s online business sector, local and international investors continue to see opportunities in the Western Australian market.

Perth-based Transparence Group Pty Ltd is supporting three initial public offerings for online businesses in the coming year.

The company, in conjunction with Perth-based investment banking group, Delta Securities, is providing half of the funding for the IPO of an eastern states-based online sports betting business, and is planning an IPO for its own website, prospectus.com.au, planned for early 2008.

Transparence is also the lead manager for the $5 million IPO of Nedlands-based real estate search website, aussiehome.com, which is scheduled to list in October, and played a passive role in the $12.5 million venture capital funding of Stephen Goh’s Project Goth, announced this month.

The company is currently rebranding its subsidiary, Subscribe Media – which manages websites such as prospectus.com.au, bookbuild.com.au and fundfinder.com.au – as Website Investment Services, or WISER.

The group is also planning to launch a new share market chat site, markettalk.com.au, within the next three months.

Subscribe Media executive chairman David Gray said the company had a very clear investment policy.

“We will not invest in technology projects that have hardware that needs to be commercialised, as they do not generally produce an acceptable rate of return,” Mr Gray told WA Business News.

He said businesses that replicated functions of the traditional print media – such as recruitment, property and automotive websites – also provided significant opportunities in the online sector.
 

Online Business: Graphic - WA Business News


One online business to have already undertaken its IPO is Perth-based online DVD rental business, Quickflix, which listed on the stock exchange in June 2005..

Quickflix director and chief executive officer, Stephen Langsford, said the company’s subscriber base had grown by 45 per cent since the start of the calendar year, and the rights issue would provide funding to further develop the uptake in subscribers

Property site rent.com.au, which lists residential, holiday and short-stay rentals, is currently pursuing further funding.

Founder Mark Woschnak said although the company had been through two rounds of capital raising during the past three years, additional capital was required to expand the business, which was likely to be sourced from an ‘angel investor’.

“We’re still at the stage of developing our market and venture capital groups typically want to see a year’s track record and solid revenues coming in the door,” he said.


The company is also planning to launch a new domain name, lease.com.au, which will cater for commercial properties and include office, industrial and retail leases.

It also owns the domain names sell.com.au and hire.com.au.

Mr Woschnak said the company was looking to create a national presence.

“One thing that has occurred over the last three to five years is online businesses are moving to mainstream acceptance,” he said. “I think the Perth market for capital support for online businesses is good.”

Social networking site Scouta, established in February this year, is currently in discussions with two investors, in addition to its existing angel investor, to raise capital for an expansion.

Founder Richard Giles said he expected to pursue further investment in a few months time, once a threshold level of 1,000 members had been reached.
Courtesy of WA Business News, 31st May 2007 - Special Report on WA Online Businesses


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