DomaCom (ASX:DCL) fractional investment platform


by Anna Napoli

DomaCom Limited (ASX:DCL) CEO Arthur Naoumidis talks about a year of significant progress with regulators, the company's capital raising to accelerate marketing and FUM and the tailwinds making fractional investment attractive.

Anna Napoli: Hi, I'm Anna Napoli for the Finance News Network and joining me now from DomaCom (ASX:DCL) is CEO Arthur Naoumidis. Arthur, welcome back.

Arthur Naoumidis: Hi, Anna. Good to be back.

Anna Napoli: Arthur, would you mind starting with a quick recap? What does the platform allow investors to syndicate today?

Arthur Naoumidis: DomaCom (ASX:DCL) allows investors to syndicate all assets but with a particular focus on property and generally residential property. Having said that, we've just syndicated our first commercial property, and we also allow advisors to syndicate mortgages, as well, internally. So, that's the core part of DomaCom's indication platform.

Anna Napoli: And, I understand you've had some big wins with the regulators recently. What does this mean for investors and your transaction volume, starting with the sole purpose test?

Arthur Naoumidis: I'm pleased to say, about four weeks ago we received the final clarification from the ATO as to how we can go forward with regards to SMSF's investing in property via the DomaCom sub-fund, and not being in breach of the sole purpose test. Now, for some of the investors, they'll understand this is a milestone, a major milestone for the company. So, we're quite excited.

Anna Napoli: And, how about the senior equity release product?

Arthur Naoumidis: Yes, that's been a seven year process of getting regulatory approval, and I'm pleased to say we got approved about a year ago, but that just began the final bit of the process, and several months ago, our PBS's are live and we're now going through the process of getting advisors, putting us on the approved product list. Now, both these are major thematics in the business, and I think investors can look forward to big growth for the business.

Anna Napoli: And, just as important as the approvals is the LaTrobe loan facility, which allows investors to borrow.

Arthur Naoumidis: Yeah. Look, I think, as I said previously, that LaTrobe loan facility has been many years in the coming because advisors are not many people investing in investment properties without debt. So, it's taken us five years to get and we've now done the first several transactions, and we've got a lot more lining up behind it. So, it will transform the business going forward.

Anna Napoli: And, Arthur, I understand you're in the midst of a capital raising. How's the raising going?

Arthur Naoumidis: Very well. So, it's a two-part raising. So, in September we completed the $3 million placement, and we're right now in the final stages of a $3 million underwritten rights issue. So, what this does is position the company, for the first time in several years, where we can focus on the business instead of having to constantly focus on raising capital. So, that's really going to be 2020, which is grow the business.

Anna Napoli: And, Arthur, last question. What are the key takeaways for investors?

Arthur Naoumidis: Well, the key takeaways, just once again, is that, for the last several years it's been just getting some milestones completed in terms of the regulatory approval for the senior equity release. That's been a multi-year, seven year, investment. And, finalising the ATO outcome with self-managed super-funds, and then, also getting the LaTrobe loan facility.

So really, we're positioned and, once again, the capital as well, because, as you can imagine, a lot of advisors, they like our product. We've got 44 dealer groups, proved product lists, and the final hurdle was our capital. And, we've now, I believe, we've addressed that and, going forward, we're going to be growing the business. So, that's really the main takeaway is the company's really ready to grow.

Anna Napoli: Arthur Naoumidis, thank you for your time and good luck in 2020.

Arthur Naoumidis: Thanks, Anna.