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Family Zone

As the internet become more prevalent and prolific in our lives and the volume of content on the internet grows, it become increasingly more important to be able to monitor and filter the content available to children. Family Zone provides software for schools to deploy on computers provided by them as well as software for parents to monitor internet activity at home.

Family Zone has a market capitalization of $227m @ $0.60 and is growing rapidly in terms of both the number of schools using the software and having the added upside of being able to offer families the ability to use the product at home.

The range of products is quite comprehensive, going as far as allowing a teacher to monitor what each student in their classroom is looking at on their screens while the student is in class.

In terms of upside the greatest upside for the company is signing up parents to use their internet tools, the company only needs to achieve a small percentage of parents to take up the product as the margins are significantly higher than the competitive school space. In the US they operate through specialist approved providers in the school space, saving the cost of establishing direct distribution models and allowing them to reach a greater percentage of the target market more efficiently.

Family Zone have just been awarded a contract with to be the preferred internet filtering provider to the largest procurement region in Texas, being region 7, with the School Manager compliance tool being rolled out to 29 schools of the 400 in the region. This covers 165,000 students.

In 2015, 94 percent of children ages 3 to 18 had a computer at home and 61 percent of children ages 3 to 18 had internet access at home. (source: U.S. Department of Education, National Center for Education Statistics.

About 56.4 million students are projected to attend elementary, middle, and high schools across the United States . Of Those:

· 50.7 million students in public schools

· 5.7 million students in private schools

While anyone with any IT savvy might just say can’t a firewall do the same thing. Partly it can in a naive way but the Family Zone tools provide far more control. In many school districts in the US laptops are provided to school students, so the risk of class action or being sued for providing access to inappropriate content is high. That dynamic is not going to go away, nor is the ability of parents to effectively control what their children are viewing whilst at home.

So for Family Zone, we see a company that is growing, a market that is growing and they have a large addressable market and are making inroads into that market.

We own FZO and think it will become a long term position in the portfolio.


Any information has been prepared for the purpose of providing general information only, without taking account of any particular investor's objectives., financial situation or needs, It is not an offer or invitation for subscription or purchase, or a recommendation of any financial product and it is not to be relied on by investors in making an investment decision. Past performance is not a reliable indicator of future performance. To the extent any general financial product advice is provided in this document, it is provided by Glennon Capital Pty Ltd ACN 137 219 866, AFSL No. 338 567. An investor, before acting on anything construed as advice, should consider the appropriateness of such construction and advice having regard to their objectives, financial situation or needs.

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