Online share registry venture Registry Direct is looking to raise $6 million ahead of a float on the ASX in October.

The freemium (part free, part paid) cloud-based online share registry allows company executives to communicate directly with shareholders.

Registry Direct plans to target public listed and unlisted companies, in a bid to nibble away at the market share of industry behemoths Computershare and Link Market Services.

The idea is to sell the service through accountancies and law firms, founder and chief Steuart Roe told Stockhead.

Mr Roe expected some 202 paying clients to come on board shortly, paying between $30 to $50 a month.

Registry Direct also managed employee share schemes, which has brought in big names such as Nasdaq, Siemens and Facebook as clients.

“Because we’re empowering people to do things themselves, anyone can do it,” Mr Roe said.

“The people who value our service are the ones who have a register, because they know how much of a pain in the butt it is.”

 

High-growth startup

Mr Roe is pitching Registry Direct as a high-growth startup — that is, they don’t yet make much  money.

The company so far has 140 paying clients — up from the 60 presented in the prospectus.

AHe’s forecasting they’ll start making money in about 18 months. The company’s cash burn and loss hit $1.2 million in fiscal 2017.

While revenue has almost doubled every year since 2015, it’s still only at $647,000. Despite this,  Registry Direct is asking for a valuation of up to $20.6 million on an issue price of 20c.

A tech analyst, who preferred to remain anonymous, said software-as-a-service (SAAS) models were “not for the faint-hearted.

“Developing a SAAS-based annuity revenue stream takes a number of years, it doesn’t happen overnight,” he said. On average it took eight years for a SAAS company to make money.

Choosing the right channel to market was critical, and success depended on companies locking in promised contracts.

The prospectus notes that Registry Direct has so far been funded by its own cash flow and $2.9 million in capital raisings.

The listing will float 35 to 48 per cent of the company but Mr Roe will retain control over at least 48 per cent.

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