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OneMove Technologies Inc. (TSX-V: OM) research and analysis

Contributed by eResearch

By eResearch

OneMove Technologies Inc. (OneMove or the “Company”) is a proprietary web-based conveyance software provider in the real estate market in British Columbia, Canada. Its real estate platform links lawyers, lenders, insurance companies, home buyers, and sellers together for seamless real estate transactions online. OneMove’s aim is to be the end-to-end solutions provider of choice for all agents in the real estate market in the province.

INVESTMENT CONSIDERATIONS

1. Strengths

The Company’s real estate transaction platform is costeffective and convenient for those involved in the real

estate market. It simplifies and expedites the process of property transactions.

OneMove’s products are superior in both quality and reliability, and have gained market acceptance in B.C.

Many Canadian provinces, including B.C., are moving towards paperless real estate transactions. In 2009, over 50% of transactions were completed online in B.C. Rapidly-growing customer base and good potential for expansion to other provinces.

2. Challenges

The customer base, although growing, is still far from reaching critical mass necessary to be self-sustainable.

Operating expenses were relatively high at approximately 99% of revenues for the 12 months ended March 2010.

Substantial capital expenditures are required to maintain the system and for product development, both of which are subject to technological changes. The Company relies on external funds to carry on its operations.

HIGHLIGHTS

OneMove closed a non-brokered private placement in late August 2010 for total proceeds of C$310,000 at a price of C$0.10 per unit. Each unit contains a common share and a warrant exercisable at a price of C$0.15 for a two-year period.

In July 2010, OneMove achieved its one-year goal of acquiring a record 12 new clients in the month to reach a total client base of 400.

The Company recently entered into an agreement with Stone Communication Services to gain exposure to the capital markets.

In June 2010, the amendment to the Land Title Act (in B.C.) allowed the Director of Land Titles to proceed with the planned implementation of requirements that land applications be submitted electronically. This provides an excellent opportunity for OneMove to expand its current client base.

Revenue for June 2010 was C$256,000, which represented an increase of 24% over May 2010, and 38% over June 2009. This reflects a larger client base and increasing demand due to the trend towards paperless transactions in the real estate market in B.C.

B.C. REAL ESTATE MARKET

There are approximately 800,000 residential real estate transactions per year in B.C., which has experienced one of the strongest real estate markets in Canada over the past 10 years. The province is moving toward paperless transactions, as paper-based transactions cause duplication and unnecessary costs.

OneMove has an exclusive relationship with the government-run web portal and thus it has access to more than 37,000 registered customers in the B.C. online database.

The Land Titles and Survey Authority of B.C. has enlisted OneMove as a partner to promote the shift to electronic filing of land registry documents.

GROWTH STRATEGY

Expand its customer base in the B.C market in tandem with the real estate industry’s shift to the government’s proposed requirement of electronic filing.

Grow transaction volumes by concentrating marketing and sales efforts on new inventory sales, and real estate and law firms that have higher volumes of conveyance transactions.

Over the next one to three years, the Company intends to expand to other Canadian provinces, potentially Alberta (adjacent province) and Ontario (size).

PRODUCTS

OneMove provides software solutions to all agents involved in real estate transactions. The Company’s product is web-based conveyance software that provides a completely integrated electronic exchange environment for lawyers, bankers, insurers, and real estate agents. It charges a user fee per transaction (buys, sells, re-finances, and projects). Transaction fees represent most of its revenues.

Average gross revenue is C$30 per transaction.

OneMove also provides title search services and charges a fee.

PARTNERS

Partners offer complementry services

First Canadian Title: is electronically integrated with the Company’s conveyance platform.

MDA Lending Solutions: does title search for the Company’s clients.

Chicago Title: provides title insurance with the Company’s conveyance platform.

OUTLOOK

The strong growth in revenue is expected to continue due to the shift to paperless transactions in B.C. and potential moves to Alberta and Ontario within the next three years.

In the longer run, the Company is aiming at international expansion to other Commonwealth countries where conveyance is handled in a similar way as in Canada.

Until the Company reaches a critical mass, cash flow is not expected to be sufficient to finance working capital and capital expenditures and, as such, the Company is still in need of external funds for its expansion strategy.