- Its platforms are embedded in close to 300 schools in Australia and USA;
- Its platforms are used by over 200,000 users per day;
- It's signed distribution deals with telco providers in Asia, Australia and USA which service over 230m subscribers;
- Established operations and launched in Australia, USA and Philippines; and
- Being awarded numerous honours including WA IT StartUp of the Year and Westpac Top 200 Businesses of Tomorrow.
Analyst Comment: Other technology companies have listed on the ASX over the past number of years with "potentially" revolutionary ideas, however in most cases these are still to generate revenues. By contrast, we expect Family Zone to turnover around $2m in FY17 (TSI estimate) before substantially lifting revenues over the next couple of years ($21m FY19 - TSI estimate) as their unique parental control product continues to be expanded into both national and international markets.
Parental Control industry: With an estimated 1 in 3 young Australians having experienced cyber threats online today, it is not surprising that the parental control industry has developed into a $2bn per year industry and is growing at a rate of around 10% pa.
The sector is currently dominated by large multi-national corporations that generally offer stand-alone software solutions. Family Zone identified the major problem with these solutions is that they do not always protect the child outside of the home, can be hacked by children looking to bypass the protection measures and are not always up to date with the latest trends/apps, which are generally the areas of greatest risk.
What do Family Zone do differently?: Family Zone's eco-system approach is innovative, disruptive and gaining significant traction in both local and international markets. Key to the company's current and long term success is:
- A recognition that parents are 'the market' needing a solution;
- A recognition that parents seek a solution which operates in all locations where their children access the internet;
- Establishment of the world's first expert marketplace for cyber safety settings and support;
- A business model which provides services to schools and leverages their influence to bring parents into the Family Zone community; and
- A business model which allows telcos to participate in the Family Zone eco-system to improve top & bottom line outcomes.
The information in this email should not be the only trigger for your investment decision. We strongly recommend you seek professional financial advice whenever making financial investment decisions.
Valuation: We initiated coverage on Family Zone with a target valuation of $0.87 / share (current share price $0.24 / share). We determined this valuation by completing a DCF valuation on the company.
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About Family Zone Cyber Safety Ltd
Family Zone is an ASX listed and Australian operated technology company focused on the cyber safety market. Meeting a growing demand to keep kids and families safe online, Family Zone has developed a unique and innovative cloud-based parental control solution which combines Australian innovation with leading global technology.
About The Sophisticated Investor
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Family Zone Cyber Safety Ltd