NZX Listing Profile
15835544_1
2 December 2022
NZX Announcement - Blackpearl Group Listing Profile
Black Pearl Group Limited (NZX: BPG) is pleased to provide its Listing Profile to the market to support
listing on the NZX Main Board today.
BPG released a version of the Listing Profile on its website, https://www.blackpearl.com/investor-
centre/, on 29 November 2022.
There have since been three amendments made to the Listing Profile since it was first published:
1. Page 68: The cash consideration figure for the acquisition of the NewOldStamp business was
amended from NZD$784,100 to NZD$783,800. This difference is due to an updated USD to
NZD exchange rate being applied to these amounts.
2. Page 74: The “Total assets” for the year ended 31 March 2021 in the Selected Financial
Information table was amended from $7,567 to $7,587 to correct a typographical error in the
Listing Profile.
3. Page 74: The “Net cash flows from Operating Activities” for the half year ended 30 September
2022 in the Selected Financial Information table was amended from $2,752 to ($2,752) to
correct a typographical error in the Listing Profile.
ENDS
Further Information
Nick Lissette
Chief Executive Officer
Blackpearl Group
nick.lissette@blackpearlmail.com
027 440 0517
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BLACK PEARL GROUP LIMITED
29 November 2022
Prepared in connection with the initial quotation of ordinary shares in
Black Pearl Group Limited on the NZX Main Board.
Prepared pursuant to NZX Listing Rule 7.3.1(b).
NZX Listing Profile
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Key Information
Summary
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What is this?
This profile document (Profile) has been prepared in accordance with the NZX Listing
Rules, to support the initial quotation of ordinary shares (Shares) in Black Pearl Group
Limited (Blackpearl Group or the Company) on the NZX Main Board (Listing). Unless
stated otherwise, the information in this Profile is provided in relation to the Company
as at the proposed date of listing 2 December 2022.
No Shares are being offered as part of the Listing. However, Shares may be traded on
the market after Listing. Shares give you a stake in the ownership of Blackpearl Group.
You may receive a return if Blackpearl Group increases in value and you are able to sell
your Shares at a higher price than you paid for them.
If Blackpearl Group runs into financial difficulties and is wound up, you will be paid only
after all creditors and holders of preference shares, if any, have been paid. You may
lose some or all of your investment.
About Blackpearl Group
Founded in 2012, Blackpearl Group is a technology company that builds, acquires and
markets data driven cloud-based services, consisting of a suite of productivity and
digital marketing applications for small-to-medium sized businesses (SMBs).
It has become increasingly expensive for SMBs to acquire and manage customers,
and SMBs may be forced to rely on expensive digital advertising networks for growth.
To help address this issue, Blackpearl Group leveraged its extensive cloud computing
experience to create the core of Blackpearl Group’s technology - a private and
proprietary technology platform called the “Pearl Engine”. The Pearl Engine supports
the companies in the Blackpearl Group and their cloud-based, Software as a Service
(SaaS) applications. The current applications in the Blackpearl Group improve the
effectiveness of how businesses communicate via email.
Blackpearl Group envisions that the Pearl Engine can be used to support other
commonly used digital communication services, with a vision to transform
communication services into marketing tools.
Blackpearl Group has two wholly owned subsidiary companies, Black Pearl Mail, Inc.,
incorporated in Arizona, United States of America (USA), and NewOldStamp Limited,
incorporated in New Zealand. Blackpearl Group owns the Pearl Engine. Blackpearl
Group also owns and operates the Black Pearl Mail solution and its applications, which
are available through http://blackpearlmail.com. NewOldStamp Limited owns and
operates the NewOldStamp solution and its applications, which are available through
http://newoldstamp.com.
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The Black Pearl Mail and NewOldStamp solutions each provide affordable SaaS
applications which are either fully, or in part, able to be purchased and implemented
online in a self-service fashion. These applications improve the effectiveness of how
businesses communicate via email. Features include the ability to transform email into
a demand generation tool, the provision of a centralised email signature management
system and real-time analytics.
On the back of a 244% organic revenue growth in FY2022 from FY2021, Blackpearl
Group is now focused on increasing the number and type of applications in the group,
aiming to replicate the success of Blackpearl Group’s acquisition of the NewOldStamp
business from NewOldStamp Inc (further information on the acquisition of the
NewOldStamp business can be found on page 37 of the Profile under the heading
“Acquisition of NewOldStamp”).
As at the date that the NewOldStamp business commenced trading as part of
Blackpearl Group (1 November 2022), Blackpearl Group has Annual Recurring Revenue
of NZ $2.8 million (Annual Recurring Revenue means a non-GAAP financial measure
which shows the value of contracted recurring revenue of Blackpearl Group’s term
subscriptions normalised to a one-year period).
Blackpearl Group has attracted an array of notable shareholders. At the time of this
Profile, significant investors include Tim Crown (founder and chairman of the NASDAQ-
listed Fortune 500 company Insight Enterprises (NASDAQ:NSIT)), other high profile
individuals and an institutional investor.
For more information on Blackpearl Group, its applications and the Pearl Engine, see
Section 2: Blackpearl Group and what it does.
Purpose of Listing on the NZX
Listing on the NZX is aligned with Blackpearl Group’s growth strategy as it will provide
the opportunity to enhance the Company’s profile and reputation as a trusted cloud
services provider for businesses both domestically and internationally.
In addition, Blackpearl Group employs subject matter experts across marketing and
technical disciplines. The brand awareness and status that comes from being a
publicly listed company will help in attracting and retaining the best available talent.
Blackpearl Group is not raising capital in conjunction with the Listing on the NZX.
Notwithstanding this, Blackpearl Group may raise capital in the future and may issue
shares as consideration for future acquisitions (as described under the heading
“Acquisition Strategy” on pages 34-35). Shares of a public company can be traded
providing Blackpearl Group with a pathway to liquidity.
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About Blackpearl Group’s Shares
Following completion of the Listing, Blackpearl Group will have 37,637,864 equity
securities on issue. These include 34,753,864 Shares, all of which will be quoted on
the NZX Main Board. The remaining equity securities are 384,000 Restricted Shares,
briefly described below and in further detail under the heading “Other equity
securities of Blackpearl Group – Restricted Shares” on page 51 and 2,500,000 Warrants
also described in further detail under the heading “Other equity securities of
Blackpearl Group – Warrants” on page 51.
Each Share gives the holder the right to:
• attend and vote at a meeting of the Company, including the right to cast one vote
per Share on a poll (subject to any voting prohibitions that may apply under the NZX
Listing Rules);
• an equal share with all other Shares in any dividends authorised by the Company;
• an equal share with all other Shares in the distribution of surplus assets of the
Company in any liquidation of the Company;
• receive certain information from the Company (including its financial statements
and annual report); and
• other rights as a shareholder conferred by the Companies Act 1993 and the
Company’s constitution.
The Restricted Shares have been issued to the non-executive directors in office
as at the date of this Profile. The Restricted Shares have an issue price of NZ$1.25
per Restricted Share but are issued to the relevant directors as fully paid for nil
consideration. The Restricted Shares have the same rights as Shares except that
the Restricted Shares:
• are not transferable;
• may be redeemed by Blackpearl Group if the director to whom the Restricted Shares
has been issued ceases to hold office before a specified date; and
• will automatically convert into Shares on specified dates.
For more information on the Restricted Shares, see Section 2: Blackpearl Group
and what it does under the heading “Other equity securities of Blackpearl Group –
Restricted Shares” on page 51.
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On 24 November 2022, Blackpearl Group issued 2,500,000 Warrants to Crown BP
Holdings, LLC, an entity associated with the Chairman of Blackpearl Group, Tim Crown.
Each Warrant entitles the holder to receive a Share for an exercise price of $0.01 per
Share. The Warrants cannot be exercised for six months following their date of issue
and can then be exercised at the discretion of the holder at any time in the following
five year period.
The Warrants were issued as consideration for Crown BP Holdings, LLC advancing a
NZ$2.4 million loan to Blackpearl under a promissory note as described on page 61.
The advance under the promissory note was sought to increase Blackpearl Group’s
cash reserves at listing at a low servicing cost to Blackpearl (a 1% per annum interest
rate is payable) to support Blackpearl Group’s cashflows over the 26-month term of the
advance. The advance is secured over all present and after acquired personal property
of Blackpearl Group under a general security agreement granted in favour of Crown BP
Holdings, LLC.
The Warrants represent 7.19% of all Shares currently on issue in Blackpearl Group and
will, on exercise, cause dilution to other Blackpearl Group shareholders. The Warrants
are described in further detail under the heading
“Other equity securities of Blackpearl
Group – Warrants” on page 51.
As described in further detail in Section 2 (Blackpearl Group and what it does),
Blackpearl Group has also granted the following rights to Shares:
(a) Provided that any applicable vesting conditions are met, Blackpearl Group has
granted up to 2,167,718 share rights in the Company to current and former employees
and independent contractors under Blackpearl Group’s existing employee share
rights scheme. Each share right is a right to one Share. The share rights may vest
immediately or on specified vesting dates. Once vested, the share rights are held
in trust until the relevant employee, independent contractor or director requests in
writing that the Share is issued or transferred to them, or Blackpearl Group notifies
the relevant employee, independent contractor or director in writing that the Share
will be issued or transferred to them. Each Share issued in connection with the
share right has a specified issued price but the Share is issued to the recipient as
fully paid for nil consideration. For further information on the share rights scheme,
see Section 2: Blackpearl Group and what it does under the heading “Employee
incentives - Pre-listing Share Rights Scheme”
on page 58.
(b) Provided that the applicable conditions to issue Shares are met, Blackpearl Group
has agreed to issue Shares to NewOldStamp Inc. or its nominees in part payment of
the purchase price under the acquisition of the NewOldStamp business. For further
information on the Share issues connected with the acquisition of the NewOldStamp
business, see Section 2: Blackpearl Group and what it does under the heading
“Acquisition of NewOldStamp” on page 37.
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(c) Provided that the applicable conditions to issue Shares are met, Blackpearl Group
has agreed to issue Shares to specified independent contractors to Blackpearl
Group’s wholly owned subsidiary NewOldStamp Limited under Agreements to
Provide Services. For further information on the Share issues connected with the
engagement of independent contractors to NewOldStamp Limited, see Section 2:
Blackpearl Group and what it does under the heading “Employee incentives - Other
employee or independent contractor incentives” on page 60).
Following Listing, Blackpearl Group will establish a new short term incentive plan for
senior executives and a new employee incentive scheme that are appropriate for a
listed issuer.
Listing statistics and key dates
Total number of Shares on issue at Listing34,753,864
Financial year end31 March
Expected Listing and quotation date2 December 2022 under NZX code “BPG”
How you can get your money out
Blackpearl Group intends to quote its Shares on the NZX Main Board. This means you
may be able to sell them on the NZX Main Board if there are interested buyers. You may
get less than you invested. The price will depend on the demand for the Shares.
The only way in which a holder of Shares can realise their investment is to sell their
Shares. If you sell your Shares, you may be required to pay brokerage or other sale
expenses. You may also be liable for tax on the sale of your Shares. You should seek
your own tax advice in relation to your Shares.
Key drivers of returns
Blackpearl Group considers that the following current and future aspects of Blackpearl
Group’s business have, or may have, the most impact on the financial performance of
the business.
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Customer base
The number of customers using the Blackpearl Group’s solutions and applications.
Key strategies and plans:
• Investment in sales and marketing activities that drive increased traffic to Black
Pearl Mail’s and NewOldStamp’s websites and may increase conversion of website
visits to paying customers.
• Maximise each of Black Pearl Mail and NewOldStamp’s website traffic and
existing customer bases through cross-selling and up-selling promotions between
the solutions.
• Drive product-led growth through enabling existing and new applications to access
select elements or entire components of the Pearl Engine at near zero marginal cost
to the application.
Strategic acquisitions
Accelerating growth through the acquisition of incumbent software businesses with
long term customers, unique capabilities and stable recurring revenues.
Key strategies and plans:
• Buy into market positions that would otherwise take years to build using an organic
sales process.
• Attain talent from acquisitions of businesses which provide immediate access to
industry experts.
• Increase utilisation of an acquired business’ resources through access to Blackpearl
Group’s talent and the Pearl Engine technology.
• Improve revenue-to-cost ratio through leveraging existing resources and accessing
economies of scale.
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Pearl Engine platform research and development
(R&D)
Enhancing functionality of the Pearl Engine to increase the features and functionality of
Blackpearl Group’s solutions and applications.
Key strategies and plans:
• Merge elements of acquired technologies, including the NewOldStamp solution and
applications, into the Pearl Engine platform.
• Increase each application’s utilisation of Pearl Engine assets.
• Enrich datasets with third party data sources in the Pearl Engine data cycle (as
described in further detail under the heading “Technology - Data enrichment to
value creation (Data-to-Value Cycle)” on page 19).
• Investment in data analysis to improve analytics and build new features, including
applied artificial intelligence.
Application led growth
Accelerating growth by increasing revenue for each application.
Key strategies and plans:
• Execution of standard practice SaaS marketing and sales endeavours.
• Maximising the marketing and customer-base assets of Blackpearl Group’s
applications through cross-selling and upselling.
• Invest in development of new features in the applications. Informed by Pearl Engine
data cycles and agile development practices, Blackpearl Group will continue
application level R&D to unlock new market segments and increase average revenue
per customer.
• Evaluate and enhance user experiences to increase website-visit-to-paid-customer
conversion rates.
You should read this summary in conjunction with Section 2: Blackpearl Group and
what it does and Section 4: Blackpearl Group’s financial information.
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Key risks affecting this investment
Investments in shares are risky. You should consider if the degree of uncertainty about
Blackpearl Group’s future performance and returns is suitable for you. The price of these
Shares should reflect the potential returns and the particular risks of these Shares.
Blackpearl Group considers that the most significant risk factors that could affect the
value of the Shares are:
Risk FactorsDescription
Dependence on
third party service
providers such
as Google and
Microsoft
Blackpearl Group’s Black Pearl Mail and NewOldStamp SaaS
solutions and applications integrate with third party service
provider’s platforms, including Google and Microsoft email.
These third party service providers could update or change
their platforms and systems in a way that materially impacts
on the features, functionality and quality of service for one
or both of the Black Pearl Mail or NewOldStamp SaaS solutions.
Other more minor or day-to-day updates or outages by
third party service providers could affect the smooth running
of Blackpearl Group’s Pearl Engine or SaaS solutions
and applications.
Security breaches
and unauthorised
access to
customer data
Blackpearl Group’s applications involve the processing,
cloud hosting and storage of customers’ information, including
email addresses and information regarding the customer’s
organisational structure. There is a risk that unauthorised
access or security breaches to the applications could result
in the leak of information or temporary inability to access the
application’s features. There is a risk that security breaches
and incidents could result in potential enforcement action
and monetary fines from data protection authorities, litigation
by customers, termination of customer contracts, potential
indemnity obligations, and potential remediation costs.
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Risk FactorsDescription
Strategic
Acquisition Risk
While Blackpearl Group will be growing organically, the
Company will seek strategic acquisition opportunities in order
to build a customer base at a lower cost than using an organic
sales process. Blackpearl Group will integrate acquisitions
into the Blackpearl Group and look to cross-sell and up-sell to
the acquired customer base. There is a risk that acquisitions
do not produce the forecasted revenue benefits or cost
synergies. Blackpearl Group’s performance is dependent on
the efficient allocation of capital into initiatives that generate
positive returns. The allocation of capital to a non-performing
acquisition is at the opportunity cost of investing in organic
sales initiatives, marketing campaigns, or research and
development projects. A non-performing acquisition may result
in the partial or complete write-off of the capital invested.
This summary does not cover all of the risks of investing in Shares. You should also read
Section 5: Risks to Blackpearl Group’s business and plans.
Where you can find Blackpearl Group’s financial
information
The financial position and performance of Blackpearl Group are essential to an
assessment of this investment. You should also read Section 4: Blackpearl Group’s
financial information.
Capitalisation Table
Capitalisation table
Number of shares on issue at Listing 34,753,864
Listing price$1.25
Implied market capitalisation$43.4million
Net cash$4.3million
Implied enterprise value$39.2million
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Contents
2Key information summary
1
15Blackpearl Group and
what it does
2
Key features of the shares
3
64
Blackpearl Group’s
financial information
4
66
Risks to Blackpearl Group’s
business and plans
5
79
Ta x
6
89
Where can I find more
information
7
91
Contact information
8
93
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Letter from the Chairperson
of the Company’s Board
Dear Investor,
On behalf of the Blackpearl
Group board, I’m delighted to
bring Blackpearl Group
to the NZX.
Blackpearl Group is an innovative technology company that builds, acquires and
markets data driven cloud-based services. Recent economic conditions have made it
increasingly expensive for small to medium sized businesses to acquire and manage
customers. We often hear businesses lamenting at the high cost of pay-to-play
platforms. Blackpearl Group’s mission is to empower companies with the technology,
data and talent to accelerate their growth. This applies equally to our customers and
the businesses we acquire.
The Company’s core technology is the Pearl Engine - a private and proprietary platform
that supports Blackpearl Group’s solutions and applications and drives organic growth.
Time and money are a business’s scarcest resources. Applications in the Blackpearl
Group can access select elements or entire components of the Pearl Engine at near
zero marginal cost to the application. We consider that this can save millions of dollars
and years of time in R&D. That means faster and more affordable growth.
Blackpearl Group has attracted investment and support from high profile individuals
and an institutional investor. We believe it’s our ability to assemble world-class talent
that has placed us in such an advantageous position to accelerate growth.
Led by Founder and Chief Executive Nick Lissette, Blackpearl Group has an
accomplished and driven management team supported by a global team of industry
experts. The Blackpearl Group’s team is passionate and committed to fulfilling the
Company’s vision and goals. This results-focused attitude is in part responsible for our
rapid organic revenue growth in FY2022 – an impressive 244% from FY2021. This growth
has been further fuelled by the recent acquisition of the NewOldStamp business from
NewOldStamp Inc., a leading email signature provider.
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Acquisition is a significant component of our growth strategy. Current economic
conditions have heavily restricted private companies’ access to capital. This has been
compounded by fast paced evolution of the technology industry which requires these
businesses to continually invest in R&D. Whilst this has created unprecedented buying
opportunities, at our heart we are a company built by entrepreneurs, for entrepreneurs.
Blackpearl Group offers technology founders a path to exit, however, our true value is
supporting them in realising their technology’s growth goals. Hence our vision – Better
growth, together.
We look forward to Blackpearl Group becoming a publicly listed company, and on
behalf of my fellow Directors I welcome your support of Blackpearl Group.
Yours sincerely,
Tim Crown
Chairman
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Blackpearl Group and
what it does
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Overview of the business
Blackpearl Group is a technology company that builds, acquires and markets data
driven cloud-based services.
The core of Blackpearl Group’s technology is the Pearl Engine. The Pearl Engine is a
private and proprietary platform where Blackpearl Group’s SaaS applications can
access technology components and data developed or acquired by Blackpearl Group.
Each company within the Blackpearl Group can access the Pearl Engine components for
their applications at a near zero marginal cost to the application. This reduces the time
and cost of research and development for each application, enabling faster and more
affordable product-led growth for those applications. The Pearl Engine drives Blackpearl
Group’s organic growth and acquisition strategies.
Blackpearl Group owns and operates two SaaS solutions marketed to SMBs. They are:
• the Black Pearl Mail solution and its applications, owned and operated by Blackpearl
Group and available through http://blackpearlmail.com.
• the NewOldStamp solution and its applications, owned and operated by
NewOldStamp Limited (Blackpearl Group’s wholly owned subsidiary company) and
available through http://newoldstamp.com. The NewOldStamp business was recently
acquired by NewOldStamp Limited and has not yet accessed components of the
Pearl Engine. Blackpearl Group intends to facilitate the access to the Pearl Engine’s
components for NewOldStamp’s SaaS solution and applications in the short term.
(Above: The Pearl Engine and application structure)
The Black Pearl Mail and NewOldStamp applications improve the effectiveness of
how companies communicate via email. Features include the ability to transform
email into a demand generation tool, centralised email signature management
and real-time analytics.
The SaaS model enables Blackpearl Group’s customers to purchase and implement
the applications online in a self-service fashion, either fully or in part on a subscription
basis, with the software being located on external cloud-based servers rather
than located in-house or as a downloadable product. As at the date of this Profile,
Blackpearl Group serves over 4,000 customers across multiple geographies through
the Black Pearl Mail and NewOldStamp solutions.
Blackpearl Group’s Pearl Engine is engineered to support a wide variety of digital
technologies and communication services. As such, Blackpearl Group intends
to continue to build and acquire new companies and applications to support
growth ambitions.
The Blackpearl Group Company Structure
Blackpearl Group has two wholly owned subsidiaries, NewOldStamp Limited and
Black Pearl Mail, Inc.
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Company history
Blackpearl Group was founded in 2012 when New Zealand technology entrepreneur Nick
Lissette (a founder of Blackpearl Group) felt it was becoming increasingly expensive
for businesses to acquire new customers in the digital world. Several years were spent
building the Black Pearl Mail solution and applications to assist with market validation
and data collation.
In 2016, the Company secured backing from Tim Crown, founder and chairman of the
NASDAQ-listed Fortune 500 company, Insight Enterprises (NASDAQ:NSIT).
Subsequently the Company has attracted investment from high profile individuals and
an institutional investor.
Before the COVID-19 pandemic, the Company operated a strategy that focused on
sales through partner networks. At that time, Cherryl Pressley was Chief Executive
Officer of Blackpearl Group’s wholly owned subsidiary Black Pearl Mail, Inc., given
Cherryl’s extensive experience operating partner networks through Cherryl’s previous
role as Head of Scaled Partnerships at Google.
In 2020, COVID-19 impacted the Company’s growth initiatives, with the partner network
strategy proving not to be feasible in the pandemic environment. This resulted in the
Company retrenching its headquarters from Arizona, USA back to New Zealand and
changing the direction and development of the Company strategy from a focus on
sales through partner networks to direct sales to customers. Through this transition,
Blackpearl Group took the opportunity to further develop the Pearl Engine, with a view
to enhancing its data capabilities to mirror the Company’s direction and strategy.
Nick Lissette led Blackpearl Group as Chief Executive Officer in the development and
implementation of this strategy. Blackpearl Group re-engaged in the market in 2021 and
achieved 244% revenue growth for FY2022 from FY2021.
On 1 November 2022, Blackpearl Group acquired the NewOldStamp business from
NewOldStamp Inc. – a leading email signature provider. Further information on the
acquisition of the NewOldStamp business can be found under the heading “Acquisition
of NewOldStamp” on page 37 of the Profile.
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Technology
The Pearl Engine
The Blackpearl Group’s private and proprietary platform, the Pearl Engine, is an
important driver of organic growth for both built and acquired applications.
Blackpearl Group’s SaaS applications can be informed and enhanced by technology
components developed or acquired by Blackpearl Group and by data flowing through
the relevant application and the Pearl Engine platform itself. Each company within
the Blackpearl Group can access the Pearl Engine components for their applications
at a near zero marginal cost to the application. This reduces the time and cost of R&D
for each application, enabling faster and more affordable product-led growth for
those applications.
As at the date of the Profile, Blackpearl Group’s Black Pearl Mail SaaS solution
and applications utilises components from the Pearl Engine. The NewOldStamp
business was acquired on 1 November 2022 and the NewOldStamp SaaS solution and
applications have not yet accessed components of the Pearl Engine. Blackpearl Group
intends to facilitate the access to the Pearl Engine’s components for NewOldStamp’s
SaaS solution and applications in the short term.
Data enrichment to value creation (Data-to-Value Cycle)
At the Pearl Engine’s core is a full life-cycle data enrichment process covering the
capture, cleansing, transformation, analysis and visualisation of data, including
customer data and email metadata. This cycle can integrate with the companies
in the Blackpearl Group and the applications they offer, enriching the feature set
and benefits for customers. This will in turn attract more customers and, of equal
significance, creates a new layer of interactions and data which will feed into the next
data cycle and unlock a deeper understanding. Within Blackpearl Group, this life-cycle
is viewed as the Data-to-Value Cycle.
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(above: the Pearl Engine Data-to-Value Cycle)
Integrations
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The Data-to-Value Cycle can be broken down into five stages:
1. Integrations
The first stage refers to the integration of applications with the Pearl Engine.
Blackpearl Group’s SaaS applications can integrate with the Pearl Engine
components at a near zero marginal cost to the application. This allows Blackpearl
Group to build (or acquire) a component once and deploy it to many applications,
reaching more customers. The integration of data into the Pearl Engine platform from
Blackpearl Group’s SaaS applications enables the later steps of the Data-to-Value
Cycle and the return of enriched data and features.
2. Data Capture stage
The data capture stage is focused on collecting useful data points collected in user
interactions with Blackpearl Group’s Black Pearl Mail solution and applications. The
Black Pearl Mail solution’s privacy policy enables the Pearl Engine to capture over
40 variables from a single interaction with any email. This builds the historical and
real time data set for subsequent value creation. The Black Pearl Mail solution and
applications and the Pearl Engine do not examine or store the email contents, nor
does it store personal information except in accordance with the Black Pearl Mail
solution’s privacy policy and applicable laws.
3. Data cleanse
Within digital communication, leading email service providers are increasing their
implementation of internet bots. In the context of email, internet bots are automated
software applications geared towards ensuring the legitimacy of interactions with
applications by mimicking elements of the behaviour of real user interaction, such as
automated link clicking and automatic caching of certain emails upon receipt.
These interactions can introduce significant noise in and distortion to what
applications record as end-user interactions. This creates challenges to producing
data that meets data quality goals of accuracy, completeness, consistency,
timeliness, validity and uniqueness.
To address this Blackpearl Group has engineered proprietary algorithms to identify
false interactions and remove them before they are reported to customers.
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4. Data transformation
The raw data collected by Blackpearl Group is then transformed into structures and
formats that allow analysis, interpretation and additional machine learning.
In addition to customer-facing features, data transformation unlocks deeper
understanding of the data and interactions across the SaaS applications, creating
additional opportunities for new features and efficiencies in the future.
5. Data analysis
The Pearl Engine platform and the integrated SaaS applications produce a breadth
and depth of data, which is the foundation for providing valuable insights to
Blackpearl Group’s customers. Through the data, Blackpearl Group seeks to provide
customers with the ability to act on reliable and verifiable information about human
interaction with communication services.
The data also creates valuable insights for the Blackpearl Group, enabling the
Blackpearl Group to build additional features; and so, the cycle continues.
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The Pearl Engine Platform
(above: Assets in the Pearl Engine)
The Pearl Engine platform itself is a unique array of technology, algorithms, systems and
code all built and refined by data. Through APIs, companies in Blackpearl Group’s group
and the applications offered by the Blackpearl Group can access feature sets, code or
data pools.
The Pearl Engine components that companies in the Blackpearl Group and the
applications offered by the Blackpearl Group can utilise can be broadly categorised
into the following assets:
• UX Assets: UX assets refers to components related to front-end code and user
experience (UX) flows, enabling applications to access proven UX flows for
conversion optimisation and front-end code which is multi-platform tested.
• Microservices: Microservices are often referred to as ‘back-end’ code, but are more
specifically combinations of code which service functional purchases such as
security, efficiency or operating systems.
• Data: Blackpearl Group has collated a breadth and depth of organisation
structure data, customer data and metadata, including from the delivery, receipt
and interaction with email. This data can be used to enrich existing data sets for
application level reporting or for individual analysis through the Data-to-Value Cycle.
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• Tracking: Tracking refers to incorporating elements into digital communication
applications that can be interacted with and reported on. This technology can be
used to enrich the functionality and analytics provided by applications.
• MTA Asset Serving: MTA Asset Serving is a purpose built ‘Mail Transfer Agent’
designed for the secure and efficient processing and delivery of business email.
• Artificial Intelligence and Machine Learning: Artificial intelligence and machine
learning systems are used to analyse data and uncover trends or outcomes. An
example of this is the Pearl Engine bot identification abilities is Blackpearl Group’s
proprietary machine learning algorithms engineered to remove false interactions.
Current results from internal data analysis show that over 60% of email interactions
are bot generated, up from 43% in 2021.
25
Email without Black Pearl MailEmail with Black Pearl Mail
Blackpearl Group’s SaaS solutions and their
applications
Black Pearl Mail
Black Pearl Mail is Blackpearl Group’s self-built SaaS solution available through the
Black Pearl Mail website www.blackpearlmail.com. Black Pearl Mail enables SMBs to
centrally manage their email branding and transform their daily business email into a
marketing tool.
Through the Black Pearl Mail applications, businesses can apply enhanced branding,
incorporate trackable elements into emails and use the vacant ‘real-estate’ under the
email signature for banner messaging (typically used for cross-selling, references and
promotions). The Black Pearl Mail applications enable businesses to transform daily
email to a demand generation tool that drives revenue through cross-selling, up-
selling, promotion and referrals. This is underpinned by analytics, including reporting
and real-time notifications on how and when recipients are engaging with their email.
26
Black Pearl Mail’s real time engagement dashboard
Black Pearl Mail’s customer base is geographically diverse, representing the global
nature of business email. The largest geographic area is the USA, accounting for 62%
of customers. The average number of users per customer is 26.
Black Pearl Mail is used by a broad range of industries, including professional services,
real-estate, brokers and marketing agencies.
Black Pearl Mail is a month-to-month service of tiered pricing, with the average
length of a customer’s subscription period (average lifetime usage) being 47 months.
The service’s average monthly recurring revenue per customer is NZ$168 (calculated
based on the average monthly recurring revenue per customer for the 12 months
immediately preceding 31 October 2022). This creates an average lifetime revenue of
NZ$7,896 per customer.
In March 2022, Blackpearl Group launched an innovative digital marketing campaign
for Black Pearl Mail, which was supported by an outbound sales force. The target was
SMB businesses in the USA, Canada, UK, Australia and New Zealand. The Black Pearl
Mail product experienced explosive revenue growth in FY2022 of 244% from FY2021.
27
NewOldStamp
On 1 November 2022, Blackpearl Group acquired the NewOldStamp business from
NewOldStamp Inc., an email signature management company based in the USA, with
contractors in the USA and Europe (including Eastern Europe). This is the first example
of an acquisition under Blackpearl Group’s Acquisition Strategy, outlined under the
heading “Acquisition of NewOldStamp” on page 37.
NewOldStamp is an in-market SaaS solution that enables businesses to centrally
manage their email signatures.
NewOldStamp has created over 5,000,000 business email signatures for professionals.
NewOldStamp’s website, www.newoldstamp.com, receives over 1 million organic
site visits annually. The acquisition of the NewOldStamp business, together with
its broadened lead utilisation from the number of organic site visits, provides
opportunities for Blackpearl Group to cross-sell, up-sell and increase conversion
opportunities across its Black Pearl Mail and NewOldStamp applications.
NewOldStamp has quarterly and annual pricing plans, with some legacy monthly
pricing plans in place. The average length of a customer’s subscription period (average
lifetime usage) is 42 months. The service’s average monthly recurring revenue per
customer is NZ$27 (calculated based on the average monthly recurring revenue per
customer for the 12 months immediately preceding 31 October 2022). This creates an
average lifetime revenue of NZ$1,161 per customer.
NewOldStamp is operated through Blackpearl Group’s wholly owned New Zealand
subsidiary, NewOldStamp Limited.
28
Competitive landscape and industry overview
Blackpearl Group operates in two different competitive landscapes, being:
• Blackpearl Group as an acquirer of SaaS technology companies and/or
applications; and
• Blackpearl Group as a company that creates and develops the Pearl Engine and
SaaS applications.
Blackpearl Group as an acquirer of SaaS technology companies and/or applications:
As an acquirer of SaaS technology companies and/or applications who service the
SMB market, Blackpearl Group is competing with businesses or entities that also
acquire those types of companies. This can include private equity firms, Special
Purpose Acquisition Companies and any acquisition-focused business.
Blackpearl Group’s initial targets for acquisitions include first generation email
signature and email tracking companies. Recent examples of entities that have
acquired such companies include vCita (a small business management app that
acquired email signature company WiseStamp in August 2019) and eKomi (a review
service that acquired email signature company Crossware in approximately
October 2021).
Blackpearl Group’s core technology, the Pearl Engine, provides a competitive
advantage in this market. The Pearl Engine is likely to provide acquired businesses and/
or applications with a source of organic growth post-acquisition, which in turn may
maximise any agreed earn-out packages for the sellers.
Blackpearl Group as a company that creates and develops the Pearl Engine
and applications:
The Black Pearl Mail and NewOldStamp solutions and applications compete in the
fragmented global market of email and email management.
Email itself is not a fixed entity, but a loosely agreed set of protocols which are
interpreted differently by different providers. The specific subset of email which the
Blackpearl Group’s current applications operate in is business email - typically defined
as the email sent by businesses and their employees to customers, colleagues, vendors
and suppliers via services such as Google Workspace and Microsoft 365.
29
The Black Pearl Mail and NewOldStamp applications integrate with Google Workspace
and Microsoft 365 and provide additional features and benefits.
The Black Pearl Mail applications combine centralised email branding, signature
management and real-time analytics reporting and notifications. This places the Black
Pearl Mail business at the intersection of three markets - email signature management,
digital marketing and email tracking. Black Pearl Mail, therefore, is more than just an
email signature provider. Potential customers may evaluate Black Pearl Mail alongside
more advanced email branding companies such as Code2 and Exclaimer that provide
similar experiences and analytics.
The NewOldStamp applications have historically competed at a basic email signature
level, for which primary competition include Wisestamp and Letsignit. With the
NewOldStamp applications now part of the Blackpearl Group, the NewOldStamp
applications can access technology components of the Pearl Engine, such as data
and analytics. In time, this will provide a significant differentiation from the current
competitors to the NewOldStamp applications (which do not offer a similar level
of data and analytics) and bring the NewOldStamp solution closer to the services
provided by the Black Pearl Mail solution.
blackpearl
Applications
Customer
relationship
management
Customer
analytics
Data
analytics
Marketing
automation
Email
marketing
Pedictive
analytics
Email
signatures
(above: the competitive landscape and industry of Blackpearl Group’s applications)
30
Security and infrastructure
The Blackpearl Group applications and the Pearl Engine are hosted in AWS, Azure,
Digital Ocean and Google Cloud.
Blackpearl Group’s Azure cloud environments are configured for high availability
and are geographically dispersed across multiple regions including Microsoft's East,
Central and West USA.
All the data centres are manned 24x7, and have strict controls and procedures around
access to any physical infrastructure. All data centre facilities are ISO 27001 and SOC II
certified - both global compliance standards for service organisations.
Research and Development (R&D)
Blackpearl Group’s R&D occurs both in the Pearl Engine platform and for
each application.
Pearl Engine Platform R&D
The Data-to-Value Cycle of the Pearl Engine is where new features and product
iterations can be assessed, developed and released to encourage organic growth
and to enhance up-sell and cross-sell opportunities between applications and in
anticipation of acquisition opportunities.
The key areas of R&D for the Pearl Engine will be focused on:
• increasing the breadth and depth of the data points captured in the Data-to-Value
Cycle so that it can be used in a wide variety of applications through increasing
third party data points, internal development and acquisitions;
• maintaining and improving the data cleanse stage in the Data-to-Value Cycle
to ensure that the Pearl Engine keeps up to date with ever-evolving bots and
technologies that may interfere with and distort data collection; and
• creating new products, features and iterations that would target broader markets
and consumers, and therefore, increasing Blackpearl Group’s revenue and value.
Further information on the Pearl Engine Data-to-Value Cycle can be found under the
heading “Technology - Data enrichment to value creation (Data-to-Value Cycle)” on
page 19 of the Profile.
31
R&D for Blackpearl Group applications
Blackpearl Group intends to continue to create a pipeline of applications with new
features and functionality to cross-sell or up-sell to existing customers and seek to
increase the number of website visits that convert into paying customers. Blackpearl
Group will also invest in the development of new features in existing applications or
use its Acquisition Strategy to target the acquisition of businesses that will provide new
applications, in order to help unlock new market segments to create opportunities to
increase the average revenue per customer.
As R&D is an expensive endeavour both in terms of time and capital, one of Blackpearl
Group’s strategic advantages is the ability for an existing or newly acquired application
to access select elements or entire components of the Pearl Engine at a near zero
marginal cost to the application, through leveraging pre-built and market proven
Pearl Engine components. This is because the components in the Pearl Engine can be
quickly added to an application in the Blackpearl Group via APIs. In practical terms, this
enables an application to add existing Pearl Engine features for less cost and R&D time
than if they had to develop those components themselves.
Blackpearl Group will also evaluate user experiences to determine opportunities for
enhancement to increase website-visit-to-paid-customer conversion rates.
32
Business model
Blackpearl Group’s business model is focused on building dependable recurring
revenue streams from a geographically and industry diverse customer base. Blackpearl
Group considers a customer base that has an average lifetime usage of 42 to 47 months
to be a dependable recurring revenue stream. Blackpearl Group intends to further grow
a dependable recurring revenue stream through acquiring customer bases and organic
revenue growth.
Blackpearl Group applications operate SaaS business models where monthly, quarterly
or annual fees (as applicable to the relevant SaaS application) are paid by customers in
exchange for access to the applications. The type of software licence varies depending
on product, customer size and the existence of legacy customer agreements.
The primary revenue success metric for Blackpearl Group is monthly and annual
recurring revenue. Customer retention is key to building dependable recurring revenue
streams. As at the date that the NewOldStamp business commenced trading as part
of Blackpearl Group (1 November 2022), Blackpearl Group has Annual Recurring Revenue
of NZ $2.8 million (Annual Recurring Revenue means a non-GAAP financial measure
which shows the value of contracted recurring revenue of Blackpearl Group’s term
subscriptions normalised to a one-year period).
The average monthly SaaS churn rate, being the average percentage of customers that
have terminated their licences in the 12 months immediately preceding 31 October 2022,
was 2.13% for the Black Pearl Mail solution and 2.35% for the NewOldStamp solution. SaaS
companies targeting SMBs typically have a monthly churn rate between 3 to 7%.
To ensure that Blackpearl Group is up to date with the market and consumer demands
within the ever-changing and fast-developing world of technology, Blackpearl Group
aims to provide regular software upgrades and enhancements as well as offering upsell
and cross-sell opportunities to its existing customer base.
33
A summary of how the Black Pearl Mail solution and the NewOldStamp solution generate
revenue is provided below:
SolutionRevenue
Type
Proportion
of FY2022
revenue
(%)
FY2022
revenue
Revenue
model
Revenue
recognition
policy
Description
Black Pearl
Mail
Subscription
revenue
100%NZ$726,526Recurring
monthly
or annual
fee
Over time
as the
services are
delivered
to the
customer
Customers pay
a subscription
fee to access
the service.
Amount of
fee varies
depending on
the number
of users of
the service.
Customers are
invoiced on
a monthly or
annual basis
throughout
the term of the
contract.
New
OldStamp
Subscription
revenue
100%NZ$916,089Recurring
quarterly
or annual
fee
Over time
as the
services are
delivered
to the
customer
Customers pay
a subscription
fee to access
the service.
Amount of
fee varies
depending on
the number
of users of
the service.
Customers are
invoiced on a,
quarterly or
annual basis
throughout
the term of the
contract with
some legacy
monthly pricing
plans in place.
34
Growth strategy
Blackpearl Group’s growth strategy can be broken into two areas:
• growth of the Blackpearl Group, through acquisitions; and
• growth at an application level, through sales and marketing initiatives.
Growth Strategy: Blackpearl Group Level
Acquisition strategy
Blackpearl Group will look to buy existing businesses or applications to consolidate
market share and/or build capability, including key talent (Acquisition Strategy).
Strategic acquisitions can provide an opportunity to buy into a market position
that would otherwise take years to build, as well as providing cross-sell and up-sell
opportunities to both new and existing customers. Blackpearl Group’s acquisition
strategy is aimed at long term growth in the Company through access to key talent,
new marketing assets and a stable customer base.
Blackpearl Group’s Acquisition Strategy can be broken down to three phases:
1. Phase one: Blackpearl Group intends to integrate companies that offer
first-generation email tracking and/or simple email signature to grow Blackpearl
Group’s consumer base and reach and build the foundation for future growth
and development. As an established email branding company, this approach will
allow Blackpearl Group to mitigate some risk in these initial acquisitions.
Companies that Blackpearl Group has identified as high return and minimal risk for
the purposes of phase one, include:
• first generation email tracking companies;
• simple email signature companies; and
• directly and indirectly adjacent companies with no clear path forward as a
stand-alone company.
The acquisition of the NewOldStamp business (described under the heading
“Acquisition of NewOldStamp” on page 37) is an example of an acquisition in
this phase.
35
2. Phase two: Phase two of Blackpearl Group’s Acquisition Strategy aims to solidify the
Company’s customer base and key talent while broadening business focus through
acquisitions of companies that have existing assets and revenue that are adjacent
to Blackpearl Group’s current technologies.
Companies that Blackpearl Group have identified as targets include:
• Business-to-Business companies that lack scale, capital for growth and
access to customers;
• USA ‘orphan tech’ companies in the communications space;
• inbound/outbound email technology companies; and
• directly adjacent technologies to current Blackpearl Group technologies.
3. Phase three: Phase three outlines Blackpearl Group’s future goals and possibilities
for the long term, which aims to focus on expanding and developing Business-to-
Business communications technology.
Once listed, Blackpearl Group will be required to comply with the NZX Listing Rules
in relation to continuous disclosure (including with respect to material information
relating to acquisitions), and major and related party transactions would require
shareholder approval.
Phase
One
• Ist generation email tracking
companies
• Simple email signature
companies
• Directly and indirectly
adjacent companies with
no clear path forward as a
stand-alone company
Phase
Two
• B to B companies with lack of
scale, capital for growth,
access to customers.
• US orphan tech companies in
the communications space.
• Inbound/outbound email
technology companies.
• Directly adjacent technologies
to current Black Pearl
technologies.
Phase
Three
• Looking forward into the long
term (5+ years) Black Pearl
will expand into new
possibilities primarily
focused on B-to-B and
communications.
36
Blackpearl Group’s Due Diligence Process
Blackpearl Group has a comprehensive technical, financial and legal due diligence
process that applies to all future and potential acquisitions. As part of the due
diligence process, Blackpearl Group considers six integration factors:
1. General operations with a focus on the target’s annual recurring revenue (ARR).
2. Technical due diligence with a focus on the target’s code ownership, type and
quality of code, work practices, security protocols, data management,
IT infrastructure, backlog of bugs and errors and investigation into any third
party reliance.
3. Any cultural implications such as language considerations and geographic
location, and the target’s management structure, including key person liability.
4. Sales/Marketing/Support, mainly focusing on organic traffic history and origins,
prospective customers, sales processes, paid campaigns and website code
and platform.
5. Financial information, which can be split into two focus points being:
a. The financial operations of the target, which involves reviewing financial
statements and audit accounts, forecasts and budgets of the target,
accounting and billing systems, existing and contingent liabilities and other
general financial due diligence; and
b. Financial integration with Blackpearl Group, with a focus on tax implications
and financial reporting requirements to align with the NZX Listing Rules and
Financial Markets Conduct Act 2013.
6. Legal due diligence appropriate to the nature of the transaction, which may include
a review of customer contracts, supplier contracts, employment or contractor
agreements, intellectual property registrations and protections and data
protection processes.
Some of the due diligence aspects may be outsourced and some aspects performed
internally by Blackpearl Group personnel. The nature of the due diligence process
undertaken, and the level of involvement of external experts, depends on the size of the
acquisition, the complexity of the application, the structure of the transaction and the
quality of the records kept.
37
Acquisition of NewOldStamp
The NewOldStamp business has operated for seven years, including materially
trading through the entity NewOldStamp Inc. (an entity registered in Delaware, USA)
since approximately December 2019. The NewOldStamp business has over 3,600
customers spanning multiple geographies and, as at 1 November 2022, its website
http://newoldstamp.com received over 1 million organic site visits annually.
On 28 October 2022, Blackpearl Group entered into an agreement for the purchase of
the NewOldStamp business from NewOldStamp Inc. Consideration was NZD$4,858,691
and USD$150,000, made up of:
• payments at completion of NZD$200,000 and USD$150,000;
• the issue at completion of NZD$999,729 of Shares at an issue price of NZD$1.25
per Share;
• payment to be made on 5 January 2023 of NZD$300,000;
• subject to certain conditions being met, the deferred issue of Shares on the date
that is 12 months following completion of the purchase, being up to:
• 719,659 Shares at an issue price per Share of NZD$1.25; and
• NZD$900,000 of Shares at an issue price per Share of the Average Market Price
(as defined in the NZX Listing Rules) where “Day A” is the date that is 12 months
following completion of the purchase; and
• subject to certain conditions being met, the deferred issue of Shares on the date
that is 24 months following completion of the purchase, being up to:
• 623,510 Shares at an issue price per Share of NZD$1.25; and
• NZD$780,000 of Shares at an issue price per share of the Average Market Price
(as defined in the NZX Listing Rules) where “Day A” is the date that is 24 months
following completion of the purchase.
The accounting treatment of the consideration for the purchase of the NewOldStamp
business is set out under the heading “Acquisition of NewOldStamp” on page 37.
Full completion of the acquisition occurred on 1 November 2022. The NewOldStamp
business was acquired by Blackpearl Group’s subsidiary NewOldStamp Limited
(New Zealand Company Number 8483340).
38
The acquisition of the NewOldStamp business provided Blackpearl Group with a
cost-effective way to broaden Blackpearl Group’s lead utilisation, create opportunities
to cross-sell, up-sell and increase conversion opportunities and access industry
leading technical expertise.
Blackpearl Group completed commercial, legal, financial and technical due diligence
on NewOldStamp Inc and the NewOldStamp business in line with the relevant elements
of the due diligence process outlined above. Blackpearl Group completed all elements
of the due diligence in-house. A competent service provider has performed an
assurance review of revenue of NewOldStamp Inc.
Blackpearl Group has an ongoing services agreement with NewOldStamp Inc. for the
provision of 27 contractors (whom Blackpearl Group can bring in-house by agreement
with each contractor).
In addition, Blackpearl Group’s subsidiary NewOldStamp Limited has entered into
Agreements to Provide Services directly with NewOldStamp Inc.’s shareholders
Volodymyr Zastavnyy, Valerii Androshchuk and Olga Zabalkanska, under which each
shareholder will provide services to Blackpearl Group.
NewOldStamp Inc.’s majority shareholder, Volodymyr Zastavnyy, owns the email
signature generator business “MySignature’’ conducted through the domain name
www.mysignature.io and has granted to Blackpearl Group an exclusivity period of
12 months from completion of the acquisition of the NewOldStamp business, during
which Volodymyr Zastavnyy will not enter into discussions, negotiations or contractual
arrangements to sell “MySignature” or its business and assets with any person or entity
other than Blackpearl Group. Blackpearl Group has not commenced any due diligence
into the MySignature business and assets and has no intention to acquire such
business or assets as at the date of this Profile.
39
Awareness
Lead
generation
Lead
nurture
Sales
Onboarding
Consideration
Intent
Evaluation
Purchase
• Website visit
• Case studies
• Marketing campaigns
• Consumer research
• Blogs
• Social media engagement
• Automated campaigns
• Retargeting media content
• Product demo
• Product trial
• Setup call with onboarding team
• Setup transaction is completed
(Above: the SaaS Sales and Marketing Funnel)
Website visits are converted to paying customers through partial or full self-servicing
setup and management processes. These processes are augmented with in-bound
and out-bound sales promotions to optimise conversion rates.
Growth Strategy: Applications
Blackpearl Group aims to grow its Black Pearl Mail and NewOldStamp solutions
through:
• Executing standard SaaS marketing and sales endeavours (described below).
• Maximising the marketing and customer-base assets of Blackpearl Group’s
applications through cross-selling and upselling.
• Enhancing and developing new features in the applications, to unlock new market
segments and create opportunities to increase average revenue per customer.
• Evaluating and enhancing user experience to improve website-visit-to-paid-
customer conversion rates.
As cloud-based SaaS applications, growth in Blackpearl Group’s applications is based
on building awareness through paid and/or organic digital marketing. Blackpearl
Group applications run campaigns to increase the quality and quantity of website
traffic generated. Data based analytics are used to measure the success of the
campaign and inform Blackpearl Group on areas for improvement.
40
Above: Black Pearl Mail - Sign-up example
In time, Blackpearl Group intends that the Black Pearl Mail solution and applications
and the NewOldStamp solution and applications will share customer bases and
potential leads to enable cross-selling and up-selling sales opportunities. Blackpearl
Group envisages that this could include:
• Passing Black Pearl Mail’s non-compatible prospects to NewOldStamp.
• Retargeting NewOldStamp organic site visits with Black Pearl Mail product
campaigns.
• Identifying NewOldStamp prospects and customers with higher marketing use
cases and upselling them to Black Pearl Mail.
• Repurposing paid marketing budgets between applications depending on current
campaign engagement and conversion levels.
41
Directors and Senior Leadership Team
Board of Directors
Tim Crown | Non-Executive Director and Chairman
Tim Crown is a co-founder and current Chairman of the
Insight Enterprises Board, a global IT solutions company listed
on the Fortune 500 and publicly trading on NASDAQ. Insight
Enterprises employs more than 10,000 professionals in 19
different countries, with over US $9.4 billion of net sales in 2021.
In addition to serving as Chairman of the Blackpearl Group
board, Tim also holds leadership roles at Redcatracing.
com, Stormwind.com, Nocira.com, Coplex.com, and the
Crown Foundation, a charitable organisation that provides
educational services for both children and adults in the USA.
Tim also instigated the establishment of the 501(c)3 Summit
School of Ahwatukee for Preschool through to eighth grade
in the year 2000. The school has received national and state
level awards, including the 2012-2013 Creative Achievement
Award from the Association of Collegiate Schools of
Architecture. Today, the Summit School serves close to
500 students.
Tim resides in Arizona, USA and joined the Blackpearl Group
board in January 2020 as Chairman. Tim is a member of the
Audit and Risk Committee and the Remuneration Committee.
The Board considers that Tim is not an independent director.
42
Nick Lissette | Executive Director and Chief Executive Officer
Nick Lissette is a founder and Chief Executive Officer of
Blackpearl Group.
Nick has over a decade of experience working with cloud
email providers. In 2006 Nick established Silver Cloud Mail
Company, an anti-spam SaaS service which was sold in 2012.
Nick went on to found Blackpearl Group where he managed
the initial capitalisation of the Company and oversaw the
building of the Pearl Engine and Black Pearl Mail technology.
Nick took on the role of Chief Technical Officer of Blackpearl
Group in 2019, where he led the technical team to build
the real-time analytics application, ‘Insights’, which won
bronze in the Business to Business Services category at the
American Business Awards®. Nick reverted to his role as Chief
Executive Officer in March 2021 and subsequently oversaw
a 244% revenue growth in FY2022 from FY2021, the pre-
listing capitalisation of the company and execution of the
Company’s acquisition of the NewOldStamp business.
Nick is a Member of the New Zealand Institute of Directors and
has a Bachelors degree from Victoria University of Wellington.
Nick is a founding director and shareholder of Blackpearl
Group. Nick resides in New Zealand. The Board considers that
Nick is not an independent director.
Mark Osborne | Non-Executive Director
Mark is a Chartered Accountant with over 25 years of private
sector, public sector and international experience. Mark has
specific expertise in financial policy and governance.
Mark Osborne resides in New Zealand and was appointed
in November 2022. The Board considers that Mark is as an
independent director. Mark will chair the Audit and Risk
Committee and is a member of the Remuneration Committee.
43
Cherryl Pressley | Non-Executive Director
Cherryl Pressley has over 25 years of business experience in
the technology industry.
Cherryl’s most recent role was as Head of Scaled Partnerships
at Google. Previously, Cherryl spent 14 years working at
Microsoft in senior leadership roles, including Senior Director
of Worldwide Distribution and Channels where she provided
leadership, go to market strategic planning, and direction to a
Global Microsoft team where she led the channel sales team
to exceed cloud revenue for FY2018 with triple digit growth,
achieving over $1B in revenue.
Additionally, Cherryl led Worldwide Engineering Support
for Microsoft’s global dynamics business in the Consumer
& Enterprise Support Business Unit within Customer Service
& Support. She helped transform the company’s customer
support experience from an in-person service to an internet-
based service.
Cherryl was appointed in November 2022. The Board considers
Cherryl to be an independent director. Cherryl has been a
member of Blackpearl Group's Advisory Board since 2016 and
was Chief Executive Officer of Black Pearl Mail, Inc. (Blackpearl
Group’s wholly owned US subsidiary) from approximately
February 2019 to September 2020, Cherryl has been a Board
Director for DRS Services USA, Inc. since 2015.
Cherryl resides in Arizona, USA. Cherryl is Chair of the
Remuneration Committee and a member of the Audit and
Risk Committee.
44
Senior Management Team
Nick Lissette | Chief Executive Officer
See biography in the section under the heading “Board of
Directors” on page 42.
Karen Cargill | Chief Financial Officer
Karen is a Fellow Chartered Accountant and member of the
Institute of Chartered Accountants of England and Wales
with over 20 years’ experience. Karen came to Blackpearl
Group after a decade of working in the United Kingdom for
companies such as Iron Mountain and Barclays Wealth.
In addition to her accounting qualifications Karen is a
Chartered Governance Professional and Chartered Secretary
and has a Bachelor of Commerce in Accounting and
Commercial Law from Victoria University of Wellington.
Karen joined Blackpearl Group in February 2015.
Sam Daish | Chief Technology Officer
Sam has worked with Xero, Kiwibank and Qrious in senior data
strategy and leadership roles, as well as consulting with the
Ministry of Social Development and Gender Equal NZ regarding
their data strategy. Sam’s roles as General Manager of Data
Innovation for Xero and Head of Artificial Intelligence and
Data Science with Qrious have given Sam over 20 years of
experience using technology to collect data for organisations
and individuals.
Sam joined Blackpearl Group in March 2022.
45
Volodymyr Zastavnyy | Chief Revenue Officer
Volodymyr has created and grown several SaaS businesses,
including mysignature.io and cheqmark.io.
Volodymyr founded NewOldStamp, a prominent email
signature management solution. As Chief Executive Officer,
Volodymyr used his experience in cloud-based services
marketing to help NewOldStamp generate millions of organic
site visits annually and drive ARR to an excess of 1m.
Volodymyr has a Masters degree of Marketing from Lviv
Polytechnic National University.
Volodymyr joined Blackpearl Group in November 2022.
Johnson Saju | Vice President of Operations
After completing a Bachelor of Management Studies,
Accounting at the University of Waikato, Johnson has gone
on to work in senior management roles for large New Zealand
companies such as ezyVet and Cin7.
Johnson has almost a decade of experience working for SaaS
companies, including as Head of Technical Customer Support
at Cin7, Global Head of Support at ezyVet and Global Head of
Customer Success at Blackpearl Group.
In addition to his University degree Johnson is fluent in English,
Hindi, Tamil and Malayalam.
Johnson joined Blackpearl Group in June 2020.
46
Substantial shareholders and relevant interests in
Blackpearl Group
As at the date of this Profile, the following persons have, and immediately after Listing
will have, a relevant interest in 5% or more of the Shares in Blackpearl Group.
Shares
Interest HolderLegal ownership or other
nature of the interest
Interest
Number of Shares % of Shares
VTPE Investments,
LLC
Registered holder and
beneficial owner
4,130,02811.88%
S Bruhns, G Bruhns,
M Thompson and
S Bruhns
Registered holder as
trustees of the Bruhns
Dixon Trust
2,781,3378.00%
Crown BP Holdings,
LLC
Registered holder and
beneficial owner
2,711,1057.80%
Sir Owen GlennRegistered holder and
beneficial owner
2,403,7206.92%
Nick Lissette and
Karen Cargill
Registered holder as
trustees of the Per Aspera
Ad Astra Trust
1,821,0005.24%
SpringCapital Club
Pty Ltd
Registered holder
as trustee for the
SpringCapital Black Pearl
Fund
1,787,4945.14%
47
As at the date of this Profile, the following persons have, and immediately after Listing
will have, a relevant interest in 5% or more of the Restricted Shares.
Restricted Shares
Interest HolderLegal ownership or other nature
of the interest
Interest
Number of
Restricted Shares
% of Restricted
Shares
Tim CrownRegistered holder and
beneficial owner
288,00075%
Cherryl PressleyRegistered holder and
beneficial owner
48,00012.5%
Mark OsborneRegistered holder and
beneficial owner
48,00012.5%
As at the date of this Profile, the following persons have, and immediately after Listing
will have, a relevant interest in 5% or more of the Warrants in Blackpearl Group.
Warrants
Interest HolderLegal ownership or other nature
of the interest
Interest
Number of
Warrants
% of Warrants
Crown BP
Holdings, LLC
Registered holder and
beneficial owner
2,500,000100
Further information on the Warrants can be found on the section
“Other equity securities
of Blackpearl Group” on page 51.
48
Shareholdings held by directors and senior managers
The table below sets out the equity securities in Blackpearl Group that the directors and
senior managers of Blackpearl Group have an interest in at the date of this Profile and
will likely have an interest in immediately after Listing.
Director /
Senior Manager
Legal ownership or other nature of
the interest
Interest
Number of
Shares, number
of Restricted
Shares and
number of
Warrants
% of Shares,
% of
Restricted
Shares and
% of Warrants
Tim CrownRegistered holder and beneficial
owner of 288,000 Restricted
Shares.
Has the power to control the
exercise of the rights attaching
to the Shares and Warrants
held by Crown BP Holdings,
LLC, by virtue of being a member
of Crown BP Holdings, LLC’s
manager Anchor Management,
LLC.
288,000
Restricted
Shares
2,711,105 Shares
2,500,000
Warrants
75% of
Restricted
Shares
7.80% of
Shares
100% of
Warrants
Nick Lissette
1
Has a relevant interest in the
Shares held by Nick Lissette
and Karen Cargill as trustees
of the Per Aspera Ad Astra Trust
(a family trust associated with
Nick Lissette), as Nick Lissette,
together with independent
trustee Karen Cargill, has the
power to control the exercise
of the rights attaching to
such Shares.
1,821,000 Shares5.24% of
Shares
Cherryl
Pressley
2
Registered holder and beneficial
owner of 48,000 Restricted
Shares.
Registered holder and beneficial
owner of 40,790 Shares.
48,000
Restricted
Shares
40,790 Shares
12.5% of
Restricted
Shares
0.12% of
Shares
49
Director /
Senior Manager
Legal ownership or other nature of
the interest
Interest
Number of
Shares, number
of Restricted
Shares and
number of
Warrants
% of Shares,
% of
Restricted
Shares and
% of Warrants
Mark OsborneRegistered holder and beneficial
owner.
48,000
Restricted
Shares
12.5% of
Restricted
Shares
Karen Cargill
3
Has a relevant interest in the
48,074 Shares held by Karen
Cargill, Ross Cargill and Duncan
Cotterill Trustee (Kinloch Laggan)
Limited as trustees of the Kinloch
Laggan Trust, as Karen Cargill,
together with the other trustees,
has the power to control the
exercise of the rights attaching
to such Shares.
Has a relevant interest in the
1,821,000 Shares held by Nick
Lissette and Karen Cargill as
trustees of the Per Aspera
Ad Astra Trust (a family trust
associated with Blackpearl
Group’s director Nick Lissette), as
Karen Cargill (as an independent
trustee), together with Nick
Lissette, has the power to
control the exercise of the rights
attaching to such Shares.
1,869,074 Shares5.38% of
Shares
Volodymyr
Zastavnyy
4
Registered holder and beneficial
owner
703,634 Shares2.02% of
Shares
Sam Daish
5
Johnson Saju
6
50
1
In addition, Nick Lissette, as trustee of the Per Aspera Ad Astra Trust (together with the
independent trustee Karen Cargill), has a relevant interest in rights to be issued a further 675,955
Shares through the share rights granted under the pre-listing employee share rights scheme (see
“Pre-Listing Share Rights Scheme” on page 58).
2
In addition, Cherryl Pressley has rights to be issued a further 627,861 Shares through the share
rights granted under the pre-listing employee share rights scheme (see
“Pre-Listing Share Rights
Scheme”
on page 58).
3
In addition, Karen Cargill has a relevant interest in rights to be issued further Shares through the
share rights granted under the pre-listing employee share rights scheme as follows:
(a) as trustee of the Kinloch Laggan Trust, together with the other trustees
Ross Cargill and Duncan Cotterill Trustee (Kinloch Laggan) Limited, rights to
be issued 189,384 Shares; and
(b) as independent trustee of the Per Aspera Ad Astra Trust (a family trust
associated with Blackpearl Group’s director Nick Lissette) together with the
other trustee Nick Lissette, rights to be issued 675,955 Shares.
(see
“Pre-Listing Share Rights Scheme” on page 58).
4
In addition, Volodymyr Zastavnyy may receive:
(a) provided the relevant conditions under the Agreement for the Sale and
Purchase of Business in relation to NewOldStamp are met, a relevant interest in
shares to be issued in accordance with such Agreement on the first anniversary
and second anniversary of completion of that Agreement (as described in
“Acquisition of NewOldStamp” on page 37); and
(b) provided the relevant conditions under the Agreement to Provide Services
between Volodymyr Zastavnyy and NewOldStamp Limited are met, a relevant
interest in shares to be issued in accordance with such Agreement on the
first anniversary and second anniversary of that Agreement (see
“Employee incentives -
Other employee or independent contractor incentives”
on page 60).
5
Sam Daish does not hold Shares as at the date of this Profile. Sam Daish has been granted up
to 65,556 share rights under the pre-listing employee share rights scheme (see
“Pre-Listing Share
Rights Scheme”
on page 58).
6
Johnson Saju does not hold Shares as at the date of this Profile. Johnson Saju has been
granted up to 58,272 share rights under the pre-listing employee share rights scheme
(see
“Pre-Listing Share Rights Scheme” on page 58).
51
Other equity securities of Blackpearl Group
Warrants
Crown BP Holdings, LLC entered into a promissory note with Blackpearl Group on
24 November 2022. Tim Crown is a director of Blackpearl Group and has a relevant
interest in Crown BP Holdings, LLC, as a manager (through his membership of Anchor
Management, LLC) and a member of Crown BP Holdings, LLC.
Under the promissory note, Crown BP Holdings, LLC advanced NZD$2.4 million to
Blackpearl Group for a period of 26 months. 2.5 million Warrants to purchase ordinary
Shares in Blackpearl Group were granted to Crown BP Holdings, LLC as the origination
fee for the promissory note. The promissory note is described in more detail under the
heading “Material interests in Blackpearl Group” on page 61 below.
Each Warrant entitles Crown BP Holdings, LLC the right to purchase one Share at an
exercise price of $0.01 per Warrant, being a total of 2.5 million Shares (or approximately
7.19% of all Shares currently on issue). The Warrants can be exercised from 24 May 2023
and will expire on 24 May 2028. Any Warrants held by Crown BP Holdings, LLC after
the expiry date will lapse and be of no further effect. To the extent that Warrants
are exercised, other shareholders in Blackpearl Group will have their shareholdings
correspondingly diluted.
Restricted Shares
On 29 November 2022 Blackpearl Group issued a separate class of equity securities to
the non-executive directors in office as at the date of this Profile (Restricted Shares).
Blackpearl Group has 384,000 Restricted Shares on issue. The Restricted Shares have
an issue price of NZ$1.25 per Restricted Share, but were issued to the relevant directors
as fully paid for nil consideration. Each Restricted Share has the same terms as the
Shares in the Company (and rank equally with Shares in respect of a liquidation of the
Company and the payment of dividends) except that the Restricted Shares:
• are not transferable;
• automatically convert into Shares in accordance with the following terms:
• 192,000 Restricted Shares convert to Shares on the one year anniversary date
of the Company’s listing and quotation on the NZX Main Board; and
• 192,000 Restricted Shares convert to Shares on the two year anniversary date
of the Company’s listing and quotation on the NZX Main Board; and
• can be redeemed by the Company for a total sum of NZ$1.00 in aggregate for all of
a director’s Restricted Shares then on issue if the relevant director ceases to stay in
office at any time before the two year anniversary date of the Company’s listing and
quotation on the NZX Main Board.
52
The number of Restricted Shares and timetable for conversion to Shares is as follows:
DirectorNumber of
Restricted
Shares
Number of Restricted
Shares that convert
to Shares on
2 December 2023
Number of Restricted
Shares that convert
to Shares on
2 December 2024
Tim Crown288,000144,000144,000
Cherryl Pressley
48,00024,00024,000
Mark Osborne
48,00024,00024,000
Pre-Listing Share Rights Scheme
Blackpearl Group has granted up to 2,024,952 rights to Shares under its existing
employee share rights scheme. See
“Pre-Listing Share Rights Scheme” on page 58 for
more information.
Issue of Shares and other equity securities
Under the Company’s constitution, the board may issue Shares or other equity
securities to any person and in any number it thinks fit. The issue of further Shares
that rank equally with, or in priority to, any existing Shares, whether as to voting rights,
distributions or otherwise, is deemed not to be an action affecting the rights attaching
to those existing Shares. However, the issue of new equity securities in Blackpearl Group
is governed by the NZX Listing Rules, which requires the approval by ordinary resolution
of the holders of the Shares to the issue of new equity securities, except in certain
circumstances set out in the NZX Listing Rules.
53
Director remuneration and benefits
The overall director fee pool (the total fees available for payment to directors in their
capacity as directors) has been fixed at a maximum of NZ$320,000 per annum.
The board may allocate the director fee pool among the directors as the board sees
fit from time to time. The allocation of the director fee pool will be recorded in the
Company’s annual report each year.
For the two years from 1 December 2022 (i.e. 1 December 2022 to 30 November 2024),
the board has resolved to allocate the director fee pool as follows:
• NZ$180,000 per annum to the role of Chair; and
• NZ$70,000 per annum to each other director (other than executive directors).
Executive directors are not remunerated in their capacity as a director. As at the date
of this Profile, Nick Lissette is the sole executive director.
However, in order to preserve cash in the Company and align (or further align) the
interests of the non-executive directors with the Company, the board and each
non-executive director have agreed that the Company will issue to the non-executive
directors Restricted Shares in part or full payment of director fees for the period from
1 December 2022 to 30 November 2024. The Restricted Shares were issued before
listing on 29 November 2022 and are described in further detail under the heading
“Other equity securities of Blackpearl Group - Restricted Shares” on page 51.
54
The following table sets out how the board expects each non-executive director in
office as at the date of this Profile will receive their allocation from the director fee pool
for the period from 1 December 2022 to 30 November 2024:
DirectorForm of director fees payable from 1 December to
30 November 2024
Tim CrownRestricted SharesBefore listing, Tim Crown has been issued
288,000 Restricted Shares at an issue price of
NZ$1.25 (with a total value of NZ$360,000) as
full prepayment of the director fees allocated
to him in the above period.
The Restricted Shares will convert to
Shares in accordance with the terms of issue
and timetable described under the heading
“Other equity securities of Blackpearl Group
Restricted Shares” on page 51.
CashTim Crown will not receive director fees in
cash for the above period.
Mark OsborneRestricted SharesBefore listing, Mark Osborne has been issued
48,000 Restricted Shares at an issue price
of NZ$1.25 (with a total value of NZ$60,000)
as part prepayment of the director fees
allocated to him in the above period.
The Restricted Shares will convert to Shares
in accordance with the terms of issue and
timetable described under the heading
“Other equity securities of Blackpearl Group
Restricted Shares” on page 51.
CashMark Osborne will receive director fees in
cash as follows:
• NZ$40,000 in the year from 1 December
2022 to 30 November 2023; and
• NZ$40,000 in the year from 1 December
2023 to 30 November 2024.
55
DirectorForm of director fees payable from 1 December to
30 November 2024
Cherryl PressleyRestricted SharesBefore listing, Cherryl Pressley has been
issued 48,000 Restricted Shares at an
issue price of NZ$1.25 (with a total value
of NZ$60,000) as part prepayment of the
director fees allocated to her in the
above period.
The Restricted Shares will convert to Shares
in accordance with the terms of issue and
timetable described under the heading
“Other equity securities of Blackpearl Group
Restricted Shares” on page 51.
CashCherryl Pressley will receive director fees in
cash as follows:
• NZ$40,000 in the year from 1 December
2022 to 30 November 2023; and
• NZ$40,000 in the year from 1 December
2023 to 30 November 2024.
The table below sets out the total of the remuneration and the value of other benefits
received by each director or proposed director of Blackpearl Group, in respect of
Blackpearl Group or any other member of Blackpearl Group’s group during FY2022 and
expected to be received in FY2023.
Director or proposed
director
Total remuneration and
value of other benefits
received in FY2022
Expected remuneration and value
of other benefits expected to be
received in FY2023
Tim CrownNZ$0NZ$360,000 (being the value of
the Restricted Shares issued to
Tim Crown in FY2023)
1
Nick LissetteNZ$330,464
2
NZ$290,378
3
Mark OsborneNZ$0NZ$83,333.33
4
Cherryl PressleyNZ$0NZ$83,333.33
5
56
1
On 29 November 2022, Tim Crown was issued 288,000 fully paid Restricted Shares for nil
consideration, with each Restricted Share having an issue price of NZ$1.25. The Restricted Shares
are issued instead of the director fees otherwise payable to Tim Crown from 1 December 2022 to
30 November 2024. The Company will not pay Tim Crown director fees in cash from 1 December
2022 to 30 November 2024.
2
NZ$270,880 of remuneration was paid to NJL Limited (in respect of which Nick Lissette is the
sole director and shareholder) for contracting services as CEO of Blackpearl Group. NZ$59,584
represents the value of share rights granted to Per Aspera Ad Astra Trust (a trust in respect of
which Nick Lissette is a trustee and beneficiary) in FY2022 (see “
Pre-Listing Share Rights Scheme”
on page 58 for a description of the nature of the share rights).
3
NZ$180,378 of remuneration was, or will be, paid to NJL Limited (in respect of which Nick Lissette
is the sole director and shareholder) for contracting services as CEO of Blackpearl Group
from 1 April 2022 to 30 November 2022. From 1 December 2022, Nick Lissette will be employed
by Blackpearl Group as CEO, with an annual base salary of NZ$330,000. The salary as CEO of
Blackpearl Group Nick Lissette will receive for the remainder of FY2023 is NZ$110,000.
4
The remuneration and value of other benefits that Mark Osborne is expected to receive in
FY2023 is made up of:
(a) the value of the Restricted Shares issued to Mark Osborne on 29 November 2022,
in part prepayment of the director fees allocated to Mark Osborne for the period from
1 December 2022 to 30 November 2024; and
(b) NZ$13,333.33 of director fees payable to Mark Osborne in cash for the period from
1 December 2022 to 31 March 2023 (being the remainder of FY2023), on the basis that
as at the date of this Profile, Mark Osborne will receive director fees in cash at a rate
of NZ$40,000 per annum.
5
The remuneration and value of other benefits that Cherryl Pressley is expected to receive in
FY2023 is made up of:
(a) the value of the Restricted Shares issued to Cherryl Pressley on 29 November 2022,
in part prepayment of the director fees allocated to Cherryl Pressley for the period
from 1 December 2022 to 30 November 2024; and
(b) NZ$13,333.33 of director fees payable to Cherryl Pressley in cash for the period from
1 December 2022 to 31 March 2023 (being the remainder of FY2023), on the basis that,
as at the date of this Profile, Cherryl Pressley will receive director fees in cash at a rate
of NZ$40,000 per annum.
The directors are entitled to be reimbursed for all reasonable travel, accommodation
and other expenses incurred by them in connection with their attendance at board or
shareholder meetings, or otherwise in connection with the Blackpearl Group business.
57
Employee remuneration and other benefits
The number of employees or former employees of Blackpearl Group who, not being
directors of Blackpearl Group, in FY2022 received remuneration and any other benefits
in their capacity as employees that was NZ$100,000 per annum or more are shown in
the table below.
Remuneration (NZ$)No. of Employees
$100,001 - $110,000
2
$130,001 - $140,000
1
$140,001 - $150,000
3
$160,001 - $170,000
1
$170,001 - $180,000
1
$210,001 - $220,000
1
$220,001 - $230,000
1
Blackpearl Group expects the remuneration and other benefits of its employees
during FY2023 to increase due to future growth and employment of new key talent.
The following table reflects the expected remuneration bands from NZ$100,000 per
annum for Blackpearl employees for FY2023:
Remuneration (NZ$)No. of Employees
$100,001 - $110,0003
$120,001 - $130,0003
$130,001 - $140,0001
$140,001 - $150,0002
$160,001 - $170,0001
$170,001 - $180,0001
$190,001 - $200,0001
58
Remuneration (NZ$)No. of Employees
$210,001 - $220,0002
$260,001 - $270,0001
$280,001 - $290,0001
Employee incentives
Pre-Listing Share Rights Scheme
Blackpearl Group has an existing employee share rights scheme (Pre-Listing Share
Rights Scheme), under which Blackpearl Group has granted current or former
employees and independent contractors rights to Shares. Under the Pre-Listing Share
Rights Scheme, current and former employees and independent contractors were
granted rights to Shares either:
(a) after completing specified periods of service (the period of time varies,
but typically the service length is two years and share rights vest in two
tranches, with 50% of share rights vesting after 12 months and the remaining
50% vesting after 24 months); or
(b) as recognition for performed services.
Once vested, the share rights are held in trust for the current or former employee,
director or independent contractor until the employee, director or independent
contractor requests in writing that the Share is issued or transferred to them or
Blackpearl Group notifies the employee, director or independent contractor in writing
that the Share will be issued or transferred to them. Once vested, each share right is
able to be exercised for one ordinary Share. The exercise price is nil per Share. The share
rights have no expiry date. Before notice is given by either party, the Shares are not
issued and the share rights carry no voting rights, no right to the payment of dividends
and no rights on liquidation of the Company.
59
These share rights are treated as treasury shares for accounting purposes and are
therefore not included in Blackpearl Group’s issued shares or in the calculations of
implied market capitalised or implied enterprise value in this Profile.
Blackpearl Group holds 1,850,136 share rights on trust for current and former employees,
directors and independent contractors. There are 174,816 unvested share rights as at
the date of this Profile. The number of unvested share rights and the relevant vesting
periods are set out in the table below:
Vesting PeriodNumber of share rights
FY 202365,556
FY 202465,556
FY 202543,704
No further share rights will be offered under the Pre-Listing Share Rights Scheme.
60
Other employee or independent contractor incentives
Under separate Agreements to Provide Services entered into with each of the following
independent contractors to NewOldStamp Limited, Blackpearl Group has offered
to issue the following Shares on the following issue dates. The Shares will be issued
provided that the relevant Agreement to Provide Services remains in effect and notice
to terminate has not been given by either party as at the relevant issue date. The
Shares have an issue price to be determined at the date of issue but will be issued as
fully paid for nil consideration.
Independent contractorNumber of Shares to be issued under relevant
Agreement to Provide Service
Volodymyr Zastavnyy364,200 Shares, with 182,100 to be issued on 1 November
2023 and 182,100 to be issued on 1 November 2024
(in each case provided the relevant conditions have
been met).
Valerii Androshchuk 87,408 Shares, with 43,704 to be issued on 1 November
2023 and 43,704 to be issued on 1 November 2024
(in each case provided the relevant conditions have
been met).
Olga Zabalkanska87,408 Shares, with 43,704 to be issued on 1 November
2023 and 43,704 to be issued on 1 November 2024
(in each case provided the relevant conditions have
been met).
New Short Term Incentive Plan for Senior Executives and New Employee Share Scheme
Following its Listing on the NZX Main Board, Blackpearl Group intends to establish a
new short term incentive plan, to incentivise and retain senior executives, and a new
employee share scheme, to incentivise and retain employees. No grants or issuances
under the new short term incentive plan or new employee share scheme have been
made as at the date of this Profile.
61
Material interests in Blackpearl Group
Crown BP Holdings, LLC entered into a promissory note (Promissory Note) and a
general security agreement (General Security Agreement) with Blackpearl Group on
24 November 2022. Tim Crown is a director of Blackpearl Group and has a relevant
interest in Crown BP Holdings, LLC, as a manager (through his membership of Anchor
Management, LLC) and a member of Crown BP Holdings, LLC. The Promissory Note
provides Blackpearl Group with additional working capital and was sought to increase
the cash reserves of Blackpearl Group from listing at a low interest servicing cost
to Blackpearl Group. One reason for Blackpearl Group undertaking this listing is to
increase its access to new capital and the Promissory Note gives Blackpearl Group
time, if necessary, to complete its listing, make progress against its business plan,
introduce its business to the investment community and then look to raise capital to
further support its growth and repay the Promissory Note. If market conditions are not
suitable for raising capital, Blackpearl Group would look to replace the Promissory
Note with another form of debt or look to agree with Crown BP Holdings, LLC to extend
or renegotiate the terms of the Promissory Note. Any variation to the terms of the
Promissory Note may be subject to the related party transactions restrictions in the NZX
Listing Rules. Any initial capital raisings by Blackpearl Group are likely to be in the form
of placements to wholesale investors as it looks to expand its shareholder base.
Under the Promissory Note, Crown BP Holdings, LLC has advanced NZD$2.4 million
to Blackpearl Group for a period of 26 months. Blackpearl Group has satisfied an
origination fee by way of an issue of 2.5 million Warrants to Crown BP Holdings, LLC,
with each Warrant having the right to purchase an ordinary Share for a strike price
of $0.01 per Warrant. The Warrants can be exercised 6 months after issue, being
24 May 2023, with an expiry date of 24 May 2028. Any Warrants held by Crown BP
Holdings, LLC after the expiry date will lapse and be of no further effect.
Blackpearl Group will pay interest on the unpaid balance under the Promissory Note
at a rate of one percent (1%) per annum, payable quarterly in arrears during the term of
the Promissory Note. Blackpearl Group must pay 50% of the principal amount by
23 December 2023 and must pay the remaining 50% in full by 23 January 2025.
Blackpearl Group can repay the Promissory Note at any time, without penalty. Under
the General Security Agreement, Blackpearl Group has granted to Crown BP Holdings,
LLC first-ranking security interest in respect of all of Blackpearl Group’s present
and after acquired personal property to secure the amount outstanding under the
Promissory Note.
62
Each of Blackpearl Group’s senior leadership team have entered into employment
agreements or independent contractor agreements with Black Pearl Group Limited or
NewOldStamp Limited (as applicable).
Volodymyr Zastavnyy entered into the Agreement for Sale and Purchase of Business
dated 28 October 2022 between Blackpearl Group Limited as purchaser, NewOldStamp
Inc. as vendor and Volodymyr Zastavnyy, Olga Zabalankska and Valerii Androshchuk
as covenantors dated 28 October 2022 for the purchase of the business and assets
of NewOldStamp (Agreement for Sale and Purchase). Volodymyr Zastavnyy is a
shareholder and the sole director of NewOldStamp Inc.
NewOldStamp Inc. entered into a Services Agreement with Blackpearl Group’s wholly
owned subsidiary, NewOldStamp Limited, for the provision of ongoing services in
relation to the NewOldStamp business, including 27 independent contractors and
related services. As stated above, Volodymyr Zastavnyy is a shareholder and the sole
director of NewOldStamp Inc.
Insight Enterprises (NZ) Limited has provided hosting services to Blackpearl Group
in FY2022, FY2021 and FY2020. Tim Crown is a director of Blackpearl Group Limited
and Insight Enterprise Inc. (a US entity), which is a related party of Insight Enterprises
(NZ) Limited.
Blackpearl Group has granted indemnities, as permitted by the Companies Act 1993,
in favour of each of its directors. Blackpearl Group maintains insurance for its directors
and officers.
63
Other material governance disclosures
On Listing, the board will have in place the following board policies and other
governance documents that are typical for a company listed on the NZX Main Board:
• Board Charter
• Audit and Risk Committee Charter
• Code of Ethics
• Continuous Disclosure Policy
• Diversity Policy
• Financial Product Trading Policy
• Remuneration Committee Charter
• Remuneration Policy
(Policy Documents)
The Policy Documents align with the NZX Corporate Governance Code with the
exception of:
• Recommendation 2.8: Blackpearl Group’s board does not have a majority of
independent directors, having two independent directors out of four directors.
• Recommendation 2.9: The Blackpearl Group Chairman (Tim Crown) is not an
independent director. However, the Chairman and the CEO are separate people in
accordance with that recommendation.
Following Listing, in accordance with the NZX Listing Rules and the constitution, the
board will have the power to appoint additional directors (including an executive
director) to the board from time to time, provided that any director appointed by the
board must retire and seek re-appointment at the next annual shareholders’ meeting
of Blackpearl Group.
64
3
Key features of
Blackpearl Group’s
Shares
65
Key features
All Shares quoted on Listing will be fully paid ordinary shares in Blackpearl Group which
will rank equally with each other and all other ordinary shares in Blackpearl Group on
issue. The key features of the Shares will not differ from those that apply to ordinary
shares in Blackpearl Group or a company generally.
Shareholders who wish to sell their Shares on the NZX Main Board after Listing must
contact a broker and have a Common Shareholder Number (CSN) and an authorisation
code (FIN).
Dividend Policy
The payment of a dividend by Blackpearl Group is at the discretion of the board
and will be a function of a number of factors, including the general business
environment, operating results, investment opportunities and financial condition of
Blackpearl Group.
While it is the aim of Blackpearl Group that, in the longer term, its financial performance
and position will enable the payment of dividends, at the date of this Profile, Blackpearl
Group does not intend, or expect, to declare or pay any dividends in the immediately
foreseeable future, given Blackpearl Group’s focus on long term growth.
What you need to do to sell your Shares
If you wish to sell your Shares on the NZX Main Board, after Listing, you must contact a
NZX Market Participant (Find a Participant - NZX, New Zealand’s Exchange) (NZX Firm)
and have a CSN and a FIN. Opening a new NZX Firm account can take a number of
days depending on the NZX Firm’s new client procedures. If you do not have a CSN,
you will:
• be assigned one when you set up an account with an NZX Firm; or
• receive one from the Share Registrar.
If you do not have a FIN it is expected that you will be sent one as a separate
communication by the Share Registrar. If you have a NZX Firm and have not received a
FIN by the date you want to trade your Shares, your NZX Firm can obtain one, but may
pass the cost for doing so on to you. In certain cases where NZX Firm is a bare trustee
structure to hold your Shares, you may not have a CSN or a FIN. Please contact your
NZX Firm to determine what you need to do to sell your Shares.
If you sell your Shares, you may be required to pay brokerage or other sale expenses.
You may also be liable for tax on the sale of your Shares. You should seek your own tax
advice in relation to your Shares.
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4
Blackpearl Group’s
financial information
67
These tables provide key financial information about Blackpearl Group. Full financial
statements are available at www.blackpearl.com/investor-centre and at
www.nzx.com/companies/BPG/documents. If you do not understand this financial
information, you can seek advice from a financial advice provider or an accountant.
Financial information presented
The table of selected financial information contained in this profile is pro forma
historical financial information. Blackpearl Group considers that pro forma information
will assist investors by providing better comparability regarding the group financials for
future periods.
As a listed entity, Blackpearl Group will continue to prepare all its future financial
statements to NZ GAAP (Tier 1) standards.
Acquisition of NewOldStamp
On 1 November 2022 Blackpearl Group acquired the NewOldStamp business from
NewOldStamp Inc. NewOldStamp Inc’s financial information includes both information
relating to the NewOldStamp business, and the revenue, expenses, assets and liabilities
of the MySignature business. Blackpearl Group only acquired the business and certain
assets from the NewOldStamp business segment. Special purpose financial statements
were prepared for the purpose of “carving out” the business of NewOldStamp from
NewOldStamp Inc.’s other financial information (Carve Out Financial Statements).
The total consideration for the acquisition of the NewOldStamp business satisfied
or to be satisfied by Blackpearl Group is NZ$4,858,691 and USD$150,000. Blackpearl
Group outlines below the expected accounting treatment for the consideration, which
includes a completion payment, a contingent payment and a post-combination
remuneration payment. This provides an indication of how Blackpearl Group expects,
as at the date of this Profile, the consideration payable will appear in Blackpearl
Group’s group financial statements for FY2023.
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Completion payment
Cash consideration of NZD$783,800.
Issue of NZD$999,729 of Shares at an issue price of NZ$1,821 per Share
1
Contingent consideration payments due to be paid in 12 months
Issue of Shares valued at NZD$1,180,899.
Contingent consideration payments due to be paid in 24 months
Issue of Shares valued at NZD$1,007,900.
1
The Shares have subsequently been subject to a share split at a ratio of 1456.8:1 outlined in
page 76 under the heading
“Capitalisation Table”
Payments to shareholders of NewOldStamp Inc.
As part of the transaction the shareholders of NewOldStamp Inc. are entitled to an
additional issue of Shares (above the consideration shown above) if they remain
contracted by NewOldStamp Limited (Blackpearl Group’s wholly owned New Zealand
subsidiary) for 12 and 24 months. These payments are considered to be post-
combination remuneration payments and are not included, for accounting purposes,
in the contingent consideration payments for the NewOldStamp business set out
above. Instead, these are accounted for as an expense in the future at the time they
are earned. The total expected value of Shares issued to shareholders of NewOldStamp
Inc. from the arrangement is NZD$1,119,648.
Further information regarding the accounting treatment of the acquisition of the
NewOldStamp business is available in the Supplementary Financial Information.
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Pro forma historical financial information
The pro forma historical financial information presented in this section has been
derived from the historical information referred to below, adjusted to NZ GAAP for
Blackpearl Group for the year ended 31 March 2020 and adjusted for structural changes
from the acquisition of the NewOldStamp business and assets for the historical periods
from 1 April 2020 until 30 September 2022 (the relevant historical period).
Adjustments for structural changes in the business include:
• amalgamating the results of the NewOldStamp business and Blackpearl Group for
the relevant historical period;
• recognising intangible assets assumed to be recognised on completion of the
NewOldStamp business acquisition. For the purposes of pro forma information,
no adjustments for amortisation have been recognised in the relevant historical
period; and
• removing external borrowing and cash balances in NewOldStamp Inc, which were
not transferred as part of the NewOldStamp business acquisition.
For the purposes of the pro forma financial information, no other adjustments have
been made regarding listing costs, efficiencies or synergies or future changes in cost
structures.
Further details of these adjustments and NZ GAAP reconciliations are included in the
Supplementary Financial Information.
Historical financial information used in the preparation of the pro forma financial
information is outlined below.
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Blackpearl Group
Historical financial information for Blackpearl Group comprises of the following:
• unaudited interim group financial statements for Blackpearl Group for the period
from 1 April 2022 to 30 September 2022 prepared in accordance with NZ IAS 34;
• audited Blackpearl Group financial statements for 31 March 2022, together with
the auditor’s report on those statements;
• audited special purpose financial statements (in accordance with the Special
Purpose Financial Reporting Framework for use by For-Profit Entities 2018 as issued
by Chartered Accountants Australia New Zealand) for Black Pearl Mail Limited
(NZ entity only) for 31 March 2021;
• unaudited special purpose financial statements (in accordance with the
requirements of the Tax Administration Act 1994 and the accounting policies
described in the notes to the financial statements) for Black Pearl Mail Limited
(NZ entity) and Black Pearl Mail, Inc. (US entity) for 31 March 2021; and
• unaudited special purpose financial statements (in accordance with the
requirements of the Tax Administration Act 1994 and the accounting policies
described in the notes to the financial statements) for Black Pearl Mail Limited
(NZ entity) and Black Pearl Mail, Inc. (US entity) for 31 March 2020.
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NewOldStamp
Historical financial information for NewOldStamp comprises the following.
• Unaudited special purpose Carve Out Financial Statements (for the purposes of
enabling management to consider the performance of the NewOldStamp business
segment and consistent with the policies described in the financial statements)
for the “carved out” business for 31 March 2022, including comparative information
for 31 March 2021.
• Unaudited special purpose Carve Out Financial Statements (for the purposes of
enabling management to consider the performance of the NewOldStamp business
segment and consistent with the policies described in the financial statements)
for the “carved out” business for an interim accounting period from 1 April 2022 to
30 September 2022.
NewOldStamp Inc. was incorporated on 11 June 2019 but the NewOldStamp business
commenced trading materially through NewOldStamp Inc. in December 2019 (therefore
only materially trading for four months in the year ended 31 March 2020). As a result,
Blackpearl Group decided not to prepare Carve Out Financial Statements for the
NewOldStamp business within NewOldStamp Inc. for the year ended 31 March 2020.
As the 31 March 2021 financial information is available in the 31 March 2022 financial
statements, no 31 March 2021 financial statements have been prepared.
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Carve out financial statements of NewOldStamp
To compile the Carve Out Financial Statements of the NewOldStamp business operating
within NewOldStamp Inc., Blackpearl Group relied on unaudited financial information
provided by NewOldStamp Inc., which was set out in the Agreement for Sale and
Purchase in relation to the acquisition of the NewOldStamp business. Blackpearl Group,
alongside NewOldStamp Inc., identified the revenue, expenses, assets and liabilities
related to the NewOldStamp business operating within NewOldStamp Inc. Under the
Agreement for Sale and Purchase in relation to the acquisition of the NewOldStamp
business, NewOldStamp Inc. and each shareholder of NewOldStamp Inc. (as
covenantors) gave warranties to Blackpearl Group that:
(a) NewOldStamp Inc. provided to Blackpearl Group all information in relation
to the accounts of the NewOldStamp business for the period from 1 April 2020
to 30 September 2022;
(b) all information provided was true, complete and accurate in all respects
and not misleading;
(c) NewOldStamp Inc. accurately notified Blackpearl Group of any income and
expenses within the information provided that was not income and expenses
of the NewOldStamp business or was partially income and expenses of
the NewOldStamp business (including the percentage attributable to the
NewOldStamp business); and
(d) the income and expenses within the information provided that was identified
as relating to the NewOldStamp business presented a true and fair view of
the income, expenses and financial performance of the NewOldStamp business,
were correct and accurate in all respects and were not affected by any
unusual or non-recurring item.
In addition, Blackpearl Group summarises below how it verified the information provided
in relation to the NewOldStamp business (and further details of that verification are
available in the notes to the NewOldStamp Business Carve Out Financial Statements for
the year ended 31 March 2022 and six months ended 30 September 2022):
• Revenue was identified via the billing system, which contains detailed information
of each subscription. This enabled clear identification of revenue for inclusion.
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• Administration expenses were identified individually and included.
• Contractor expenses were identified by the time spent on each portion of the
business. This was done via estimation, with the majority of expenses allocated to
the NewOldStamp business and included in the Carve Out Financial Statements.
• Cash and bank balances and loans were identified directly, and minimal judgement
was required.
Blackpearl Group assessed the measurement of revenue, expenses, assets and
liabilities and considered the treatments materially aligned to NZ GAAP for the
purposes of inclusion in the pro forma information. Judgements applied are outlined
in NewOldStamp Business Carve Out Financial Statements for the year ended
31 March 2022 and six months ended 30 September 2022.
On that basis, Blackpearl Group prepared the standalone Carve Out Financial
Statements for the NewOldStamp business segment within NewOldStamp Inc.
Business combination
The acquisition of the NewOldStamp business constitutes a business combination for
accounting purposes. Blackpearl Group is still assessing the impact of the business
combination for the period. Blackpearl Group outlines the initial provisional treatment
in the Supplementary Financial Information.
Financial reporting standards:
Black Pearl has reviewed the accounting policies for NewOldStamp Inc. and
adjusted the management information for consistency with Blackpearl Group and
alignment with NZ GAAP. No material adjustments were required from the Carve Out
Financial Statements.
The financial information contained in this section has been prepared by Blackpearl
Group, is presented in New Zealand dollars, and is rounded to the nearest thousand,
which may result in some discrepancies between the sum of the components and
the totals within tables, and certain percentage calculations.
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Selected financial information
Financial year
ended 31 March
Pro FormaPro FormaPro FormaPro Forma
NZD$’000Year ended
31 March 2021
Year ended
31 March 2022
Half year
ended
30 September
2021
Half year
ended
30 September
2022
Revenue
1,2081,8158931,163
EBITDA
(5,603)(4,407)(1,927)(3,033)
Net profit (loss) after
tax
(5,507)(4,373)(2,017)(3,121)
Dividends on all equity
securities of Black
Pearl
----
Total assets
7,5874,929N/A5,064
Cash and cash
equivalents
2,520117N/A423
Total liabilities
2,0442,252N/A2,367
Total debt
341368N/A378
Net cash flows from
Operating Activities
(4,692)(3,721)N/A(2,752)
Notes to table:
1. Pro forma financial information has been sourced from audited and unaudited
financial statements and management reports that are available on Blackpearl
Group’s website. Details for the pro forma adjustments can be found in the
Supplementary Financial Information.
2. EBITDA refers to earnings before interest, tax, depreciation and amortisation. EBITDA
and pro forma EBITDA are non-GAAP profit measures. No adjustments to EBITDA
have been made apart from amalgamating NewOldStamp and Blackpearl Group.
See the Supplementary Financial Information for a reconciliation.
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3. Intangible assets consist of internally generated software in Blackpearl Group and
intangibles recognised on the acquisition of the NewOldStamp business. The split
of the intangible assets from the acquisition is still being determined by Blackpearl
Group. The balances displayed reflect the assumed values and are preliminary.
See the Supplementary Financial Information for a reconciliation.
4. The pro forma debt position excludes external debt in NewOldStamp that was
extinguished in the transaction. See the Supplementary Financial Information for a
reconciliation.
5. Pro forma information for the year ended 31 March 2020 is not included in the
Selected Financial Information table. Blackpearl Group does not consider this pro
forma information to be material or relevant information on the basis that:
a) NewOldStamp Inc. was incorporated in June 2019 but the NewOldStamp
business commenced trading materially through NewOldStamp Inc. in
December 2019 (therefore only materially trading for four months in the
year ended 31 March 2020). Its financial information from that period,
including its revenue in its start-up phase, is not material information.
b) The financial information in relation to Blackpearl Group for the year ended
31 March 2020 has not been converted to NZ GAAP, with material variations
in relation to lease adjustments, revenue and the depreciation and
amortisation of intangibles.
c) Blackpearl Group had a different business model during the year ended
31 March 2020. Prior to the COVID-19 pandemic, Blackpearl Group’s sales
strategy focused on sales through a partner network. This was disrupted by
the COVID-19 pandemic and the Blackpearl Group pivoted its sales
approach to sell to customers directly, and to invest in the ongoing development
of the Pearl Engine.
d) Overall, Blackpearl Group has decided not to include the pro forma
information for the year ended 31 March 2020 based on the nature of the
information and the change in Blackpearl Group’s business direction and
strategy since that time.
Blackpearl Group had made available its unaudited special purpose financial
statements for Black Pearl Mail Limited (NZ entity) and Black Pearl Mail, Inc.
(US entity) for 31 March 2020 at www.blackpearl.com/investor-centre.
As explained above, Blackpearl Group has not made available any financial
information in relation to the NewOldStamp business for the year ended
31 March 2020.
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Capitalisation table
The board has ascribed a listing price of NZ$1.25 per Share (Listing Price) based on its
view of the equity value of Blackpearl Group.
In ascribing the Listing Price, the board considered the equity raising conducted by
Blackpearl Group in the 12 months immediately preceding the date of this Profile, where
Blackpearl Group raised NZ$6.2 million at a subscription price of NZ$1,821 per Share.
The new equity was raised from various investors including high profile individuals and
an institutional investor.
Before listing, Blackpearl Group undertook a share split at a ratio of 1456.8:1, to provide
a post-share split price of NZ$1.25 per Share.
At the time of Listing, Blackpearl Group will have 96 registered holders. None
have entered into escrow arrangements with Blackpearl Group in respect of
their shareholdings.
The Listing Price implies the valuation metric as set out in the table below. The price at
which Shares will be traded on the NZX Main Board following Listing will depend on the
demand for, and supply of, Shares and will be subject to change.
Capitalisation table
Number of shares on issue at Listing 34,753,864
Listing price$1.25
Implied market capitalisation$43.4million
Net cash$4.3million
Implied enterprise value$39.2million
Implied market capitalisation is the value of all of Blackpearl Group’s equity securities,
as implied by the Listing Price. It tells you what the Company is proposing as the value
of Blackpearl Group’s equity.
Implied enterprise value is a measure of the total value of the business of Blackpearl
Group, as implied by the Listing Price. Implied enterprise value is the amount that a
person would need to pay to acquire all of Blackpearl Group’s equity securities and
to settle all of Blackpearl Group’s borrowings. It is a measure of what the Company is
proposing the business of Blackpearl Group as a whole is worth.
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Supplementary Financial Information
The following additional financial information is available at www.blackpearl.com/
investor-centre.
Blackpearl Group
• Unaudited interim group financial statements for Blackpearl Group for the period
from 1 April 2022 to 30 September 2022 prepared in accordance with NZ IAS 34.
• Audited Blackpearl Group financial statements for 31 March 2022, together with the
auditor’s report on those statements.
• Audited special purpose financial statements (in accordance with the Special
Purpose Financial Reporting Framework for use by For-Profit Entities 2018 as issued
by Chartered Accountants Australia New Zealand) for Black Pearl Mail Limited
(NZ entity only) for 31 March 2021.
• Unaudited special purpose financial statements (in accordance with the
requirements of the Tax Administration Act 1994 and the accounting policies
described in the notes to the financial statements) for Black Pearl Mail Limited
(NZ entity) and Black Pearl Mail, Inc. (US entity) for 31 March 2021.
• Unaudited special purpose financial statements (in accordance with the
requirements of the Tax Administration Act 1994 and the accounting policies
described in the notes to the financial statements) for Black Pearl Mail Limited
(NZ entity) and Black Pearl Mail, Inc. (US entity) for 31 March 2020.
NewOldStamp
Historical financial information for NewOldStamp comprises the following.
• Unaudited special purpose Carve Out Financial Statements (for the purposes of
enabling management to consider the performance of the segment and consistent
with the policies described in the financial statements) for the “carved out” business
for 31 March 2022, including comparative information for 31 March 2021.
• Unaudited special purpose Carve Out Financial Statements (for the purposes of
enabling management to consider the performance of the segment and consistent
with the policies described in the financial statements) for the “carved out” business
for an interim accounting period from 1 April 2022 to 30 September 2022.
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Other items
The principal assumptions on which the pro forma historical information in this section
have been prepared include reconciliations between:
• Information prepared in accordance with NZ GAAP and the pro forma information
presented in the table headed Selected Financial Information above.
• EBITDA to NZ GAAP measures.
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5
Risks to Blackpearl Group’s
business and plans
80
Introduction
This section describes the risks that Blackpearl Group is aware of that exist or are likely
to arise that significantly increase the risk to Blackpearl Group’s financial position,
financial performance or stated plans. We have outlined our assessment of the
likelihood, nature, and potential magnitude of circumstances if they were to occur.
This assessment is based on the knowledge of the board as at the date of this Profile.
There is no guarantee or assurance that the importance of each risk will not change
or that other risks will not emerge over time.
Dependence on third party service providers such as
Google and Microsoft
What is it?
Blackpearl Group’s Black Pearl Mail and NewOldStamp SaaS solutions and applications
integrate with third party service providers’ platforms, including Google and Microsoft
email. Leveraging off these third party service providers’ platforms, Blackpearl Group
is able to provide enhanced email and email analytics services for BlackPearl Group’s
customers. Third party providers such as Google or Microsoft could undertake updates
or changes to their platforms that materially impact the features, functionality and
quality of service ordinarily provided by Blackpearl Group’s SaaS solutions, such as, the
sudden inability to provide data insights. Other more minor or day-to-day updates or
outages by third party providers could affect the smooth running of Blackpearl Group’s
SaaS solutions and applications.
Why is it significant?
Certain major updates and system changes by third party service providers such as
Google and Microsoft may, depending on the system change, materially impact the
functionality and quality of the services provided by Blackpearl Group’s applications.
At the most extreme, there is a risk that a major update or system change could render
some of the services offered by Blackpearl Group ineffective or the third party service
provider could compete with Blackpearl Group’s services offering a similar service
themselves. If this occurred, there is a risk that this could result in the termination of
customer contracts. This would have a flow on effect on the reputation of Blackpearl
Group and its applications which may hinder the organic growth of the Company
and impact the value of Blackpearl Group’s name within its industry and competitive
landscape. Other minor or day-to-day updates or outages could affect the smooth
running of Blackpearl Group’s applications.
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Our assessment of the likelihood, nature, and potential magnitude of any impact
Third-party platforms and service providers in the technology space regularly update
their products and services. Blackpearl Group has systems, processes and experts that
ensure the technology is keeping up to date with any changes or updates made by
these providers. Blackpearl Group considers that the likelihood of a significant or
long-term outage is low, with most outages resolving within a short duration of time.
While there is a risk of a major systemic change or disruption that materially impacts
on the features and functionality or quality of Blackpearl Group’s SaaS solutions and
applications, Blackpearl Group considers that the likelihood of a system change of this
size and nature occurring is low and would be of a magnitude that is likely to affect
other service providers that integrates with the third party platform, for example spam
filters, customer relationship management (CRM), marketing automation platforms and
calendar invitations.
Blackpearl Group seeks to mitigate the risk of updates, outages and major systemic
changes or disruptions through:
• having systems, processes and experts in place that ensure the Company’s
technology is up to date with changes or updates made by third party providers;
• the Black Pearl Mail and NewOldStamp SaaS solutions integrate with third party
service providers in different manners, diversifying the customer base that any
change or update may affect;
• undertaking R&D on the Pearl Engine platform and the Blackpearl Group’s SaaS
solutions and applications to improve features and functionality and develop new
features and functionality; and
• the Blackpearl Group’s Acquisition Strategy that provides the opportunity for the
Company to diversify the platforms that Blackpearl Group’s SaaS solutions and
applications use (for example, other communications technologies).
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Security breaches and unauthorised access to
customer data
What is it?
Blackpearl Group’s applications involve the processing and the cloud hosting and
storage of customer’s information, including email addresses and information
regarding the customer’s organisational structure. There is a risk that unauthorised
access or security breaches to the applications could result in the leak of information
or the temporary inability to access the application’s features. There is a risk that
security breaches and incidents could result in potential enforcement action and
monetary fines from data protection authorities, litigation by customers, termination of
customer contracts, potential indemnity obligations, and potential remediation costs.
Why is it significant?
Security breaches and incidents could result in Blackpearl Group facing potential
enforcement action and monetary fines from data protection authorities, litigation
by customers, termination of customer contracts, potential indemnity obligations,
and potential remediation costs. Further, the occurrence of such security breaches
or incidents, or the perception that one has occurred, could also result in a loss of
customer confidence in the security of Blackpearl Group’s applications or damage the
Blackpearl Group brand and reputation, reducing demand for the Blackpearl Group’s
applications and disrupting normal business operations.
Our assessment of the likelihood, nature and potential magnitude of any impact
Blackpearl Group takes advantage of top-tier cloud technology services to ensure
optimal up-time, data privacy and end-user benefits. In relation to the data points
stored, Blackpearl Group utilises top-tier infrastructure services that are manned 24x7
and have strict controls and procedures around access to any physical infrastructure.
All data centre facilities are ISO 27001, and SOC II certified
The likelihood of a security breach or incident is different for each of Blackpearl Group’s
SaaS solutions.
The content of sender’s emails pass through the Black Pearl Mail SaaS solution’s cloud-
based servers for branding and data priming. The Black Pearl Mail SaaS solution
operates a ‘Tag and Release’ policy in regards to the content of emails passing through
its service. This means, by design, customer email messages through the Black Pearl
Mail SaaS solution and applications will only be held on Blackpearl Group’s cloud-
based servers for a few seconds or less. Once the email is delivered, no record of email
83
content is retained. The only data that is stored is email server metadata (e.g. sender,
recipient, datetime stamp, subject line etc.). Processing email via third party servers
(including Black Pearl Mail SaaS solution) can increase security risks including data
leaks and outages.
The NewOldStamp SaaS solution and applications do not have emails routing through
their cloud-based servers in the same way as the Black Pearl Mail SaaS solution and
applications. The NewOldStamp SaaS solution may have a lesser security risk than the
Black Pearl Mail SaaS solution.
In any case, Blackpearl Group considers that any potential leak of email data would
be rare.
Strategic acquisition risk
What is it?
While Blackpearl Group will be growing organically, the Blackpearl Group will seek
strategic acquisition opportunities in order to build a customer base at a lower cost
than using an organic sales process.
Blackpearl Group will integrate acquisitions into its group and look to cross-sell and
up-sell to the acquired customer base. There are a number of inherent risks with
strategic acquisitions, including the risk of acquired businesses not producing the
forecasted revenue or cost synergies, risks around integration of the acquired business
into the Blackpearl Group business and risks around transfer and legal ownership of
intellectual property of the acquired businesses.
Why is it significant?
Blackpearl Group’s performance against it’s Acquisition Strategy is dependent on
the efficient allocation of capital into initiatives that generate positive returns.
The allocation of capital to a non-performing acquisition or failed integration into
the Blackpearl Group is at the opportunity cost of investing in a different acquisition
opportunity, marketing campaign, or research and development project. A non-
performing acquisition or an incomplete or unsuccessful integration into the Blackpearl
Group may result in the partial or complete write-off of the capital invested. Blackpearl
Group’s ability to achieve revenue growth through strategic acquisitions is dependent
on identifying appropriate acquisition targets, negotiating appropriate terms with
them, and being able to source adequate capital to fund the acquisition.
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Our assessment of the likelihood, nature, and potential magnitude of any impact
Blackpearl Group has a thorough technical, financial and legal due diligence process
and Acquisition Strategy to assist the Company to make deliberate and planned
steps alongside a business plan in support of each acquisition. To gain the support of
Blackpearl Group’s management and board, a business case needs to demonstrate
positive returns and/or strategic advantages underpinned by a consistent and
thorough due diligence process, albeit such processes are in each case dependent
on the quality of information provided by the target company. Blackpearl Group notes
that there are risks amounting from elements that are outside of Blackpearl Group’s
control that can impact the outcome and success of an acquisition, such as a
global pandemic.
Refinancing Risk
What is it?
Blackpearl Group owes NZ$2.4 million under the Promissory Note and is liable to repay
this amount in two instalments - $1.2 million on 23 December 2023 and $1.2 million on 23
January 2025.
Why is it significant?
Blackpearl Group is not currently profitable and, as it looks to grow its business over the
term of the Promissory Note, it is unlikely to be able to fund repayment of the Promissory
Note from its operating cashflows. It is likely that Blackpearl Group will need to fund
repayment of the Promissory Note through raising new capital.
Our assessment of the likelihood, nature and potential magnitude of any impact
Blackpearl Group will require new capital to fund a number of the growth strategies
outlined in this Profile. A key reason for seeking an NZX listing was to enhance
Blackpearl Group’s ability to raise capital. Blackpearl Group considers that if it can
deliver on its business strategies and build awareness of the business prospects for
Blackpearl Group in the investment community, it should be successful in securing
new capital to repay the Promissory Note and also to fund its growth plans. Blackpearl
Group is cautious that its ability to raise capital is subject to prevailing, general market
and economic conditions. The Promissory Note has been deliberately structured to be
repaid in two tranches, to give Blackpearl Group time and flexibility for raising funds for
full repayment.
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The Promissory Note is secured over the assets of Blackpearl Group and a failure to
meet its repayment obligations (unless a variation was negotiated and agreed with
the lender) could result in the lender enforcing its security which could force Blackpearl
Group into receivership and/or liquidation. That would most likely cause a total loss of
investment for Blackpearl Group shareholders. Alternatively, if Blackpearl Group raises
insufficient capital to both repay the Promissory Note and fund its growth plans, it may
need to prioritise repayment of the Promissory Note over investment in growth.
Inability to protect intellectual property rights
What is it?
Blackpearl Group is a software business with a large proportion of the Company’s
assets being intellectual property including software code, business processes,
know-how, copyright and trade marks. Blackpearl Group relies on such intellectual
property rights and there is a risk that it may fail to adequately protect its rights
for a number of reasons. There is also a risk that certain intellectual property may
be obtained (or inappropriately used) by third parties, for example, through certain
breaches of agreements, fraud, or theft by third parties.
New competitors in the industries may enter the market in the future with similar
services and applications as Blackpearl Group, or existing competitors or major email
service providers, such as Microsoft and Google, may expand their service offerings
and enhance their existing services to be similar to Blackpearl Group’s applications
(including, for example, improving their data analytics and insights).
Why is it significant?
Blackpearl Group’s value to a large extent is attributed to its intellectual property
and protection of these rights are critical for maintaining the Company’s competitive
position, reputation, and future revenues. If intellectual property rights are not
adequately protected it may result in any of the following scenarios:
• certain intellectual property may be obtained (or inappropriately used) by third
parties, for example, through certain breaches of agreements, fraud or theft;
• intellectual property being misused or misappropriated, including unauthorised use,
disclosure, or reverse engineering of Blackpearl Group’s technology;
• employees or third-party counter-parties inappropriately disclosing confidential
information on its systems, policies, and procedures; and the value of Blackpearl
Group may be negatively impacted;
86
• competitors that have significantly more financial and operational resources
than Blackpearl Group may be able to develop products similar to Blackpearl
Group’s applications and gain a reputation in the market faster or may develop
broader distribution relationships with sales partners and customers than
Blackpearl Group; and
• increased competition could adversely impact Blackpearl Group’s ability to attract
and retain customers at the price at which it offers its products and services and
reduce Blackpearl Group's market share.
Our assessment of the likelihood, nature, and potential magnitude of any impact
Blackpearl Group’s key intellectual property is not in a registrable form, however,
Blackpearl Group will continue to ensure the terms and conditions of employment
contracts and contracts for independent contractors and consultants have no
challenges to intellectual property developed in the course of the relevant employee/
contractor’s engagement with Blackpearl Group. Listing on the NZX will also further
increase Blackpearl Group’s branding and recognition.
There is a risk that actions taken by Blackpearl Group, such as data encryption, access
controls, information classification and training and general awareness may not be
adequate in all circumstances and may not prevent the misuse or misappropriation
of intellectual property or deter the independent development of similar products by
others. Further, although Blackpearl Group endeavours to enter into non-disclosure
agreements with its employees, licensees and other third parties who may have access
to intellectual property and confidential and proprietary information, Blackpearl
Group cannot assure that these agreements or other steps the Company has taken will
prevent unauthorised use, disclosure, or reverse engineering of its technology.
Another element that underpins Blackpearl Group’s Acquisition Strategy is to buy
into a market position that would otherwise take years to build. Blackpearl Group will
aim to utilise any acquisitions to incorporate new and updated technologies, concepts
and systems to maintain a competitive place in the market, both as an acquirer of
SaaS technology companies and as a developer and provider of SaaS solutions
and applications.
87
Employee attraction and retention
What is it?
Blackpearl Group’s continued success is dependent upon its ability to attract
and retain skilled and qualified personnel both domestically and internationally,
in particular, members of the senior leadership team, software engineers,
and customer success and sales teams. The inability to attract and retain skilled
personnel could slow development and maintenance of the Pearl Engine and
Blackpearl Group’s applications.
Blackpearl Group considers that there are factors that are within Blackpearl Group’s
control that affect employee retention and attraction rates, such as company
culture and employee incentive packages. There are however, factors outside of
the Company’s control, such as staff shortages due to a global pandemic or a war,
noting that Blackpearl Group has staff located globally, such as in the USA and Europe
(including Eastern Europe).
Why is it significant?
Blackpearl Group may not be able to attract and retain adequately skilled and
experienced employees or be able to find effective replacements for individuals who
leave Blackpearl Group, including in particular, members of the senior leadership team.
Blackpearl Group relies on the technological expertise of its employees to maintain
and develop intellectual property. The loss of key personnel may lead to a loss
of operational knowledge, technology capabilities, key partner and customer
relationships and industry expertise, as well as delays in completing strategic
acquisitions and in the development of the Pearl Engine and new software features or
applications of Blackpearl Group’s products.
Our assessment of the likelihood, nature, and potential magnitude of any impact
One element that underpins Blackpearl Group’s Acquisition Strategy is the procurement
of talent and leading experts within the existing market, both domestically and
internationally, and to diversify Blackpearl Group’s presence globally. Blackpearl Group
will also ensure that upon recruitment, the retention of key personnel and technical
experts be a focus and priority for the smooth running of the business. This would
be achieved through a combination of earn-out elements in sales and purchase
agreements, competitive salary and employment packages and a focus on nurturing
a motivating working environment.
88
Real or perceived errors, failures, defects, or bugs
What is it?
Blackpearl Group’s products are constantly being developed and improved. There is a
risk that undetected errors, defects, failures, or bugs may occur in Blackpearl Group’s
applications, or certain IT architecture especially when updates or capabilities are first
introduced, or when new versions or updates are released, which may make solution
processing capacity or other use ineffective, corrupt or unsuitable for the designed
purpose, or incapable of scaling in line with customer expectations.
Why is it significant?
Errors or defects may make Blackpearl Group’s applications ineffective or unsuitable
for the designed purpose. The occurrence of such incidents may lead to customers
becoming dissatisfied and ceasing to use Blackpearl Group’s applications which
could be damaging to Blackpearl Group’s brand and reputation. Widespread or
systematic bugs and defects could result in a disruption of normal business operations,
requiring Blackpearl Group to spend resources to investigate or correct the errors
or malfunctions and provide additional support to customers to resolve any issues.
Blackpearl Group may be unable to retain customers or attract new customers, due to
a poor reputation for quality, performance, and reliability.
Our assessment of the likelihood, nature, and potential magnitude of any impact
Incidents of solution malfunction or errors are likely for a business that frequently
provides new features, updates, and add-ons to its software. Prior to commercial
release, Blackpearl Group’s solutions are put through several phases of testing
including working with a small group of customers, to conduct ‘real-world’ usability
testing. Once a solution has been commercially released, risk is further mitigated with
a continued focus to deliver comprehensive customer support in the event of product
failure, to minimise the negative impact on customers.
89
6
Ta x
90
Tax can have significant consequences for investments. If you have queries relating to
the tax consequences of investing in the Shares, you should obtain professional advice
on those consequences.
91
7
Where you can find more
information
92
Further information relating to Blackpearl Group (for example, Blackpearl Group’s
constitution and its financial statements) is available at www.blackpearl.com/investor-
centre.
Further information in relation to Blackpearl Group is available on the Companies Office
register of the Ministry of Business, Information and Employment. This information can
be accessed on the Companies Office website at www.business.govt.nz/companies.
Once listed, Blackpearl Group is required to make half-yearly and annual
announcements to NZX and such other announcements as required by the NZX Listing
Rules from time to time. You will be able to obtain this information free of charge from:
www.nzx.com/companies/BPG/documents.
93
8
Contact information
94
Contact information
Black Pearl Group LimitedAddress: Level 14, 22 Willeston Street,
Wellington Central, Wellington 6011,
New Zealand
Telephone number: +64 4 803 9390
Securities Registrar -
Link Market Services Limited
Address:
Level 30, PwC Tower 15 Customs Street
West, Auckland CBD, Auckland 1010, New Zealand
Telephone number: +64 9 375 5999
Legal Advisor – Duncan CotterillAddress: Level 2, 50 Customhouse Quay,
Wellington Central, Wellington 6011, New Zealand
Telephone number: +64 4 499 3280
Auditor – Baker Tilly Staples Rodway
Audit Limited
Address: Level 4, BNZ Building, 354 Victoria Street,
Hamilton 3204, New Zealand
Telephone number: +64 7 834 6800
95
Index
TermDefinition
Acquisitionmeans the acquisition of the business and certain assets
of NewOldStamp completed on 1 November 2022.
Acquisition Strategymeans the acquisition strategy described under the
heading “Acquisition Strategy” on pages 34-35 of the Profile.
Agreement for Sale
and Purchase
means the Agreement for Sale and Purchase of Business
dated 28 October 2022 between Blackpearl Group Limited
as purchaser, NewOldStamp Inc. as vendor and Volodymyr
Zastavnyy, Olga Zabalankska and Valerii Androshchuk as
covenantors and dated 28 October 2022 for the purchase
of the business and assets of NewOldStamp.
APImeans Application Programme Interface.
Blackpearl Group or
the Company
means Black Pearl Group Limited.
Carve Out Financial
Statements
Special purpose financial statements prepared for the
purpose of “carving out” the business of NewOldStamp that
operated within NewOldStamp Inc. from the remainder of
NewOldStamp Inc.’s financial information.
CSNmeans Common Shareholder Number.
Data-to-Value Cyclemeans the full life-cycle data enrichment process at the
core of the Pearl Engine covering the capture, cleansing,
transformation, analysis and visualisation of data,
including customer data and email metadata.
FINmeans Faster Identification Number.
GAAPmeans Generally Accepted Accounting Principles.
Listing Pricemeans NZ$1.25 per Share.
96
Index
NZ IASmeans New Zealand Equivalent to International
Accounting Standard.
NZXmeans NZX Limited.
NZX Firmmeans a NZX approved Market Participant.
Pearl Enginemeans the Blackpearl Group’s private and proprietary
platform, the Pearl Engine, described on page 19
of the Profile.
Pre-Listing Share
Rights Scheme
means the employee share rights scheme described in
the section
“Employee incentives” on page 58 of the Profile.
Profilemeans this listing profile dated 29 November 2022.
R&Dmeans research and development.
Restricted Sharesmeans the restricted shares in the capital of Black Pearl
Group Limited described in the section “Other equity
securities of Blackpearl Group” on page 51 of the Profile.
SaaSmeans Software as a Service.
Sharesmeans the ordinary shares in Black Pearl Group Limited.
SMBmeans small-to-medium sized businesses.
USAmeans the United States of America.
Warrantsmeans the 2,500,000 warrants issued by Blackpearl Group
to Crown BP Holdings, LLC described in the section
“Other equity securities of Blackpearl Group” on page 51
of the Profile.
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.