Big picture - Why invest in Centralnic Group PLC
Centralnic Group PLC Snapshot
Following recent industry developments and regulatory changes, CentralNic expects, by virtue of its contracts and relationships, to benefit from a major expansion in the number of generic top level domains (“gTLDs”) such as .wiki and .college, which are expected to be operating from the end of 2013. CentralNic has been contracted as the Registry Service Provider for 60 applications for new gTLDs.
This existing business has already proven to be profitable and cash-generative, as its characteristics include:
Revenues are received in advance, often for multiple years;
Most of the top 50 registrars (by domains under management) maintain a credit balance with CentralNic, which is automatically topped up;
The actual domain name inventory is created automatically at the time of purchase, so there are no cost of sales or inventory holding costs; and
To retain their domain names, website owners are required to pay periodic renewal fees, creating an annuity income for CentralNic.
The Company has a four pronged expansion strategy:
Increasing volumes through provision of core registry services;
Investment in new gTLDs;
Investment in Registrar business; and,
CentralNic has also identified opportunities to add to its domain portfolio by winning government contracts to operate country codes for developing nations, particularly in Africa. These ccTLDs can be distributed globally via CentralNic’s retail network, as well as serving the populations of the domestic emerging markets where internet penetration is just starting to explode.
Headquartered in London, the business operates globally, with customers in almost 200 countries. The Group is focused on identifying and exploiting growth opportunities across its three divisions, through winning new clients, launching new products and services, and acquiring other companies that enhance and accelerate the growth strategy.
The Wholesale Division
CentralNic’s Wholesale Division was ranked number one globally by volume of domains registered among “Registry Backends” for new Top-Level Domains at the end of 2015 by the industry statistics website ntldstats.com. The two most important contributing factors behind this achievement are the Division’s technology platforms and operations, and the domain name inventory for which CentralNic is the exclusive global wholesaler.
Technology Platforms and Operations
CentralNic’s Wholesale Division powers specific domain names and is also their exclusive distributor through retailers globally. The DNS system which powers the domains is a global network of nameservers, which expanded from 25 to 40 locations in 2015, and which assures the stability, security and resilience of the domain names supported by CentralNic. During 2015 this system maintained its unblemished record of 100% uptime for the 19th consecutive year. Meanwhile CentralNic’s “registry engine” technical and operational system enables retailers around the world to sell an increasing range of internet domain names, as well as handling billing and cash collection on behalf of registry clients – the rights holders to the domains that CentralNic distributes. CentralNic also supports its registry clients with value addedservices such as policy advice and sales and marketing. CentralNic’s registry engine experienced 99.98% uptime in2015, comparing favourably with the standard 95% set byindustry regulator ICANN.CentralNic’s distribution platform is directly integrated witharound 1,500 retailers globally and through them the channel reaches out to over 100,000 resellers. For the past three years,China has been one of CentralNic’s most buoyant markets, reflecting a business development and operational focus onChina that has positioned the Company ideally to benefit from the unprecedented demand for domain names in that marketin 2015 and 2016.
Domain Name Inventory
Every Top-Level Domain extension, such as.com, .org and.co.uk has an exclusive Wholesaler (known in the domain name industry as a “registry backend”). CentralNic’s platform supports all five categories of domain name extensions: the Country Code Domain Extensions .la and .pw; Second-Level Domain extensions such as .uk.com and .us.com; Generic Top-Level Domain extensions like .xyz and .online; “sponsored” domains for a specific purpose such as .coop, the internet designation for cooperatives; and finally “DotBrand” Top-Level Domains such as .stc for Saudi Telecom Corporation, which use CentralNic’s wholesale platform to power domains not for sale but for the rights holder’s own use. During 2015 CentralNic retailed domain names to customers in over 200 countries globally through its multiple retail websites. Internetbs.net (IBS) is focused on a specific customer group – domain investors and internet professionals such as hosting and web design companies – offering “trade” pricing and sophisticated tools for managing domain name portfolios. During 2015, it increased its overall registered domains by over 100,000 – a growth rate of 17% during CentralNic’s first full year of ownership. CentralNic’s other retail websites each specialise in domainsunder a single Top-Level Domain (.ASIA, .LUXURY, etc.) and they also sell additional services such as hosting, email and website builders.
Mike is a world leader in European and Trans-Atlantic Technology M&A. He has over 30 years of experience working in London, New York and Los Angeles, advising private and publicly held clients on corporate transactions in technology, telecoms, advertising/marketing services, traditional/digital media, internet and e-commerce sectors. Mike is a Partner and International Head of Technology Media and Communications at the international law firm Taylor Wessing. Previously, Mike was a General Partner responsible for technology investments at Oakfield Partners. Mike obtained an LLB at the University of Reading.
Chief Executive Officer
Ben Crawford is one of the best-known figures in the domain industry, featuring extensively on ICANN’s “Ask the Experts” website and is frequently quoted in the global media. Ben has been the Chief Executive Officer of CentralNic since 2009, successfully launching the company into new markets including the Middle East, Japan and Russia, as well as winning 60 new TLD and the .PW ccTLD contracts. Ben is a specialist in global business and corporate development – his former positions included Founding President of Louise Blouin Media, integrating 11 acquisitions in three countries and launching artinfo.com; Managing Director of SportBusiness Group, where he launched the world’s leading online gambling trade media group, iGamingBusiness.com; and Executive Producer of the official website of the Sydney Olympic Games. Ben has an MBA from the Australian Graduate School of Management and a First Class Honours Degree from the University of Sydney.
Chief Financial Officer
Glenn joined CentralNic in January 2014, bringing 20 years experience across a variety of sectors, with particular experience working with technology companies, most notably in the domain name industry. Most recently, Glenn worked as Executive Director, Business Development and Finance, for Nominet, the organisation which manages the .uk internet domain. Nominet has a turnover of £26 million with 130 employees. Glenn has a bachelors degree in Physics from the University of Birmingham and between 2011 and 2012 qualified in the Institute of Director's Certificate and then Diploma in Company Direction with distinction. He also won Finance Director of the Future at UK's Finance Director Excellence Awards 2011. Glenn qualified as a Chartered Accountant in 1998 while working for a Morris & Co Chartered Accountants.
CEO - Retail
Desleigh Jameson is the CEO of CentralNic's Retail division, having joined the board following CentralNic's acquisition of the Instra Group in January 2016. She has more than 15 years of experience in retail management and start-ups. Prior to joining Instra, Desleigh was a director at Six Corporation Limited and the CEO of Retail Institute in New Zealand. She was also the founder of Allied Fastening Limited, a supplier of niche fastening products to power utilities, construction, and engineering companies. Desleigh has an Executive MBA from the University of Auckland in New Zealand.
Non Executive Director
Samuel Dayani is a partner at the Joseph Samuel Group and responsible for managing the group investments and business development. He is also a Director of Opes Industries Ltd, a waste to energy, landfill and recycling business. From 2001-2005, Samuel was the Chief Operating Officer and then Managing Director of ViaVision Ltd, an interactive TV company, before it was sold to Yoomedia plc. Samuel graduated from Queen Mary College, University of London with a BSc in Business and Biology in 2000.
Non Executive Director
Thomas Rickert is an attorney-at-law in Germany. He is the owner of Rickert Rechtsanwaltsgesellschaft mbH, a law firm with offices in Bonn and Frankfurt am Main. Thomas has extensive experience in the domain industry working on domain disputes as well as advising Registrars, Registry Service Providers and new gTLD applicants both on contractual as well as policy matters. Thomas is an expert speaker on domain related subjects both at the national and international level. Thomas has been appointed by ICANN’s Nominating Committee to serve on the Council of the Generic Names Supporting Organisation (GNSO), which is the body responsible for developing policy for generic domain names.
Non Executive Director
Tom Pridmore began his career as a solicitor at Norton Rose, specialising in corporate finance, where he acted on behalf of institutional clients in relation to a variety of corporate finance and M&A activities. Tom then joined Flextech/Telewest Plc as Head of Corporate Strategy, where he was responsible for directing investment into strategic Internet and interactive television companies. In 2000, Tom co-founded the international fund manager and investment adviser Development Capital Management Limited. In this capacity he has set-up and managed real estate investment and development operations in Turkey, India, North Africa, Eastern Europe and the UK on behalf of both institutional and private clients.
Non Executive Director
Iain is a global expert in technology and e-commerce, having had a strong track record in investing in early stage companies such as ASOS, The Hut Group, Eagle Eye Solutions, Anatwine and Metapack. He is an advisor to the William Currie Group, a family office founded by financier Bill Currie to invest mainly in technology and e-commerce companies. Iain is also a non-executive director of various of his investee companies, as well as other technology companies such as My Sale Group plc and Houseology Design Group Limited, and was nominated as a NED of the year in 2015 by the Sunday Times NED Awards. Previously, Iain was a top-ranked retail and e-commerce analyst and held positions in a number of UK investment banks. Iain graduated from the London School of Economics and Political Science (LSE), with a Bsc in Economics & Economics History.
Key members of the senior management include Gavin Brown, the Company’s Chief Technology Officer. Summary of his biography is set out below;
Chief Technology Officer
Gavin has worked at CentralNic since 2001, becoming chief technology officer in 2005. He has responsibility for all aspects of CentralNic’s Registry Engine and all technical elements of the integrated global reseller network. He is a highly respected figure in the domain industry and has been published in several professional technical journals and as well as participating in a number of technical public policy and advocacy groups.
At 30th July 2016
Shares Held %
Erin Invest and Finance Ltd*/** 21,630,382 22.56%
Kestrel Partners LLP 11,501,000 11.99%
Livingbridge VC LLP 8,983,019 9.37%
Schroders Investment Management 7,509,131 7.83%
Jabella Group Ltd** 5,687,891 5.93%
Herald Investment Management 5,025,000 5.24%
Robert Pooke** 4,982,052 5.20%
Natwest FIS Nominee Ltd*/** 3,699,000 3.86%
Antonio Lentino 3,656,450 3.81%
Unicorn Asset Management 3,611,479 3.77%
Miton Asset Management 3,250,000 3.39%
* The beneficial holder of Erin Finance and Invest Ltd and Natwest FIS Nominee Limited is the father of Samuel Dayani, a director of the Company.
** Jabella Group Limited is a BVI company owned inter alia, by Erin, Natwest FIS Nominee Limited, John Swingewood and Robert Pooke.
CentralNic Global Headquarters
Contact for: general enquiries, support, sales
London, EC2R 6AR
Tel: +44 (0)20 33 88 0600 (0830hrs - 1730hrs)
Fax: +44 (0)20 33 88 0601
CentralNic USA Office
Contact for: sales only
CentralNic USA Ltd.
350 5th Avenue
59th Floor, New York, NY 10118 USA
Tel: +1 323 375 2669
Contact for: sales only
Tel: +85258085429 (1400hrs - 2100hrs local time)
Zeus Capital Limited
82 King Street,