Summary
The fund managers believe that Urbanise com Ltd presents a compelling investment opportunity due to its strong growth potential in the technology sector. In their opinion, the company's innovative solutions for urban management are well-positioned to capitalize on increasing demand for smart city infrastructure. They highlight the firm's recent partnerships with key industry players as a significant factor that could enhance its market presence. Furthermore, the fund managers note that Urbanise's robust financial performance, characterized by consistent revenue growth and improving margins, underscores its operational efficiency. However, they also acknowledge potential risks, including market competition and regulatory challenges. Overall, the fund managers express a positive outlook on Urbanise com Ltd, suggesting that it could deliver substantial returns for investors willing to engage with its evolving strategy.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Source: Trading View
Commentary From The Managers
Jencay Capital
30 June 2025
$0.84
Summary
- Provider of market leading cloud native Strata and Facilities management enterprise SAAS in Australia and the Middle East.
- Urbanise enjoyed a share price bounce and returned to Jencay Capital's top 10.
- Concluded a strategic partnership with the National Australia Bank that entails an equity injection.
- Joint development of a market-leading banking solution for strata schemes.
- The NAB partnership will assist in generating new revenue streams.
- Can help accelerate market share gains.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
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Commentary From The Managers
Jencay Capital
30 June 2025
$0.84
- Provider of market leading cloud native Strata and Facilities management enterprise SAAS in Australia and the Middle East.
- Urbanise enjoyed a share price bounce and returned to Jencay Capital's top 10.
- Concluded a strategic partnership with the National Australia Bank that entails an equity injection.
- Joint development of a market-leading banking solution for strata schemes.
- The NAB partnership will assist in generating new revenue streams.
- Can help accelerate market share gains.
Summary
Naos Asset Management
30 June 2025
$0.84
- Naos Asset Management has held an investment in UBN for over four years, focusing on its strong strata management software.
- UBN faced challenges from past management decisions, leading to over $100 million in accumulated losses.
- Key changes include the appointment of Darc Rasmussen as Chairman and the addition of independent directors, enhancing strategic focus.
- A major milestone was the partnership with National Australia Bank Ltd (ASX: NAB), which acquired a 15% stake in UBN.
- This partnership aims to develop a data and payments integration service for strata managers, providing recurring revenue for UBN.
- Approximately 2.3 million strata-titled properties in Australia represent significant market potential for UBN's offerings.
- UBN estimates around $8 billion in deposits within strata-related bank accounts, indicating a substantial market opportunity.
- The strata industry is characterized by outdated technology, with about 60% of managers using legacy systems, creating demand for UBN's solutions.
- UBN generated over $7 million in recurring revenue from its software, holding an estimated 15% market share, with potential for growth through the NAB partnership.
- Starting in FY26, UBN expects fixed recurring fees from NAB and additional variable fees based on strata-related bank accounts.
- Market consolidation among strata software providers presents opportunities for UBN, as it is the only major player with a fully cloud-based platform.
- Projected recurring revenue from strata-related products could exceed $20 million annually in the next 3-5 years.
- UBN's financial position is strong, with a net cash balance bolstered by the NAB partnership, enhancing its valuation relative to revenue opportunities.
- The next 12-18 months will be critical for the UBN-NAB partnership's success and the adoption of their services by strata managers.
Summary
Naos Asset Management
30 May 2025
$0.84
- Urbanise is an enterprise software business focused on the property sector, delivering cloud-based solutions for strata and facilities management.
- Its core Australian strata management software handles operations like payments, voting, bank reconciliations, and workflow management for body corporates.
- The software is considered mission-critical and tends to be extremely sticky, with high perceived switching costs for customers.
- Urbanise is the only major cloud-native provider in a market where competitors still use desktop software.
- With a material market share among 2.3 million strata lots in Australia, Urbanise is well-positioned for growth.
- The end customer, typically the unit owner, pays for the software through strata fees, enabling strong pricing power.
- The strata management market is ripe for consolidation and technological uplift due to falling margins.
- Urbanise's market-leading platform positions it well to grow its customer base and wallet share over time.
- The strata market is expected to grow ~5% p.a., with Urbanise poised to capture additional share.
- Urbanise announced a strategic partnership with NAB, which acquired a 15% stake, targeting a new revenue stream from banking integration.
- The partnership aims to disrupt a market historically dominated by Macquarie by co-creating a product to reroute banking business.
- Urbanise has experience with banking integrations and now possesses both cash and product capabilities to scale this initiative.
- Execution remains a key risk regarding the NAB partnership and acquiring new customers in a long-cycle environment.
- Urbanise is now cash flow break-even, with expectations of mid-single digit growth as market churn is minimized.
- Investors will be focused on revenue contribution from the NAB banking product and continued core growth.
- The potential for growth is significant with NAB’s distribution network and Urbanise’s technology, but success will depend on execution, integration, and sustained traction.
Summary
Naos Asset Management
30 June 2024
$0.38
- Entry into Expanded Strata Market Opportunity: In Q4 FY24, UBN detailed its Horizon 3 strategy to drive long-term, sustainable growth.
- Integration and Automation: Urbanise is enhancing connections between strata management and service providers, targeting a proven market with low risk.
- Existing User Base: UBN connects with thousands of individual strata managers, managing hundreds of strata lots that require various services.
- Proven Solutions: The strategy is an add-on that leverages UBN’s current infrastructure, without significant capital expenditure or increased fixed costs.
- Market Opportunity: Valued between $30-$45 million with an estimated $20 billion of strata-related transactions annually, applying a 0.14%-0.30% fee.
- Competitive Advantage: UBN’s technological solution is considered superior to peers' outdated, non-cloud-based offerings.
- Potential Revenue Growth: Capturing 10% market share with a 0.20% fee could add $4 million ARR, positioning UBN towards profitability.
- Sustainable Growth: Successful execution may lead to a valuation of 4-7 times ARR for UBN.
Summary
Naos Asset Management
31 Dec 2023
Unknown
- Quarterly Activities Report highlights challenges with a -3% overall revenue decline, affected by decreased professional service fees.
- License revenue shows an increase of +3.1%, indicating growth potential in recurring revenue streams.
- UBN secured an additional $0.43 million in Annual Recurring Revenue (ARR) wins in October post-quarter.
- Contract renewal negotiations with the largest strata customer are ongoing, maintaining flat ARR despite a revenue decrease.
- Net loss of $0.72 million recorded in the first 3 months of FY24, signaling a need for financial performance improvement.
- Efficiency programs initiated to target $2.4 million cash flow improvement, with $1.1m from headcount savings and $1.3m from overheads and working capital.
- Potential return to positive cash flow anticipated over the next 6-12 months with successful renegotiations and ARR growth.
- Completion of board renewal process with the appointment of Darc Rasmussen as Independent Chair and James Hourn as Independent Director.
- New board members bring strong software industry experience, crucial for UBN’s future development and sales strategies.
Summary
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who has invested in Urbanise com Ltd (ASX:UBN)?
Fund managers including Naos Asset Management and Jencay Capital have invested in Urbanise com Ltd (ASX:UBN).
Why have investment managers invested in Urbanise com Ltd (ASX:UBN)?
Fund managers have invested in Urbanise com Ltd due to its strong position in the strata management software market, which is characterized by significant growth potential and a shift towards cloud-based solutions. The company has demonstrated resilience and strategic improvements, particularly following key leadership changes that have sharpened its focus on software development and operational efficiency. Urbanise's recent partnership with National Australia Bank (NAB) is a pivotal factor, providing not only capital but also a pathway to integrate banking solutions into its platform, thereby enhancing revenue streams. The recurring revenue model, stemming from its software and banking services, positions Urbanise to achieve profitability and capitalize on the expanding strata market, estimated at $30-$45 million in opportunity. Additionally, the company's ability to address inefficiencies in the strata management sector, combined with its sticky customer base and low-risk expansion strategies, further solidifies its attractiveness to fund managers.
What happened to Urbanise com Ltd (ASX:UBN)?
There have been no recent updates from fund managers regarding Urbanise com Ltd although fund managers including Naos Asset Management and Jencay Capital have previously commented.