The slimy sales tactics of prickly real estate agents may be in need of review with Australian property technology company Openn Negotiation set to debut on the ASX on Friday, 11 June.
A “proptech” company, Openn uses technology that aims to provide the best possible property sales outcomes for the seller, buyer and real estate agent.
Openn was founded by real estate professionals in 2016 to address the issue of transparency in traditional methods employed by agents for property sales. The platform facilitates real-time online bidding to achieve the best possible price and happy parties all round. The two primary services on offer are Open Offers and Openn Negotiation supporting flexible private treaty and sales processes with improved transparency. The platform publicly shows the property’s current bid, how many individual bidders there are, and how many people are watching the listing.
Agents trained by Openn and certified to use the platform are able to upload properties to the website where buyers can then view and register interest. If interested, prospective buyers can register to participate in the property’s sale campaign and bid online via web browser or Openn’s mobile app.
The platform now boasts 55,000 registered users and over 3,300 agents, and has seen $2 billion in property sales transacted so far.
The flexibility and transparency that Openn enables, and positive feedback received so far has prompted the Company to lodge their IPO. They are hoping to raise AUD $9 million at an offer price of $0.20 per share. The expected market capitalisation of the Company at the offer price is $38 million.
According to the Prospectus, Openn generated $1.16m in revenue in FY20 for a $1.2m net loss.
With their IPO fully underwritten, listing will allow the Company to scale up operations and make further investments in their technology. Openn is looking to expand its reach within the Australian and New Zealand markets through marketing and brand awareness, as well as assess the viability of the US market in line with their long term vision and growth strategy.
The Company wants to explore how they can exploit their core transaction data as well as what complementary services they can offer through their platform.
Open’s target customers are the 35,000 plus individual real estate agents working within 11,000 real estate agencies across Australia, as well as other sellers of real estate.
Revenue is currently generated from training and certification fees for real estate agents to use the patented technology platform and property upload fees, which account for 90% of the Company’s revenue.
According to the current pricing model of a fee per upload, the total addressable market within Australia is an estimated $173 million. In the US, the addressable market is as high as $2.4 billion with more than 5 million property transactions annually.
Should Openn build a database and have enough properties sold through their platform, they may seize the opportunity to monetise their data. The current total marketing related property data market in Australia is estimated at approximately $200 million.
Euroz Hartleys is acting as the Lead Manager and has fully underwritten the IPO.
Openn Negotiation is expected to commence trading on the ASX on 11 June under the indicative ticker OPN.
Samantha Freidin is a business journalist at Emerald Financial whilst also completing a Masters of Marketing and Digital Communications at Monash University.
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