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Corporation
MOBILE & TELECOMMUNICATIONS | Telecom Services / Data & Broadband
ziptel.com.au

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About ZipTel

ZipTel is a telecommunications business focused on providing international roaming and calling solutions.

ZipTel Headquarter Location

138 Main St Suite 3

Osborne Park, Western Australia, 6017,

Australia

+61 8 6252 4224

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ZipTel Web Traffic

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Page Views per Million (PVPM)
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Latest ZipTel News

Emerge to divest global multi-level marketing scheme

Sep 23, 2021

Share Listed esports and gaming technology company Emerge Gaming is mulling a spin out of its Miggster platform and has appointed financial advisor RSM Australia to help with “unlocking shareholder value”. The controversial penny stock generates 98 per cent of its revenue from Crowd1 Network, a multi-level marketing company that has been the subject of warnings from several international regulators, via the Miggster platform. Miggster is a white-labelled “e-sports” program that offers the ability for gamers to compete for low-value prizes. The Perth-based company with a market capitalisation of $24 million booked revenues of $10.86 million for the 12 months through June. Of that, $10.6 million was through sales of Miggster, money Emerge has previous disclosed “comes from Crowd1”. Emerge Gaming CEO Greg Stevens addresses an actor in a Crowd1 promotional video. On Thursday, the company said it will undertake a strategic review of its products led by advisor RSM, with the top priority being to consider options for “realising value” from Miggster, which could include the spin-off or sale of the platform. Miggster is owned by the multi-level marketing company known as Crowd1, established in Europe, registered in the United Arab Emirates and headquartered in South Africa. It has targeted consumers across Africa, China, Russia and South-east Asia. Advertisement Since Emerge Gaming announced Miggster with Crowd1 late last year, the Australian Securities Exchange has issued Emerge with seven query letters attempting to gain further clarity on the financial relationship between Emerge and Crowd1. Crowd1 and its Spain-based parent group, Impact Crowd Technology SL (ICT), have been the subject of consumer warnings from more than a dozen global regulators concerned that they could be a “pyramid scheme”. Crowd1 labels itself a “legitimate marketing company” that helps boost the self-empowerment of its members, who earn income based on how many friends and family members they successfully invite to join the company. The scheme has been criticised for coaxing millions of consumers in the developing world into handing over chunks of household savings in return for promises that they could become millionaires by marketing further take-up of Crowd1’s unsophisticated digital products to their networks. The potential divestment of the Miggster platform comes after The Australian Financial Review raised concerns about the links between the ASX-listed group and the global multi-level marketing scheme earlier this month. Although Emerge Gaming at the time told the ASX it would “provide a full response to the media article on its website”, this has not happened. The advisor for the review, RSM, was previously hired by Emerge Gaming chairman Bert Mondello to provide an independent review of ZipTel’s takeover of Australian fintech Douugh , which enabled ZipTel to relist on the ASX via the reverse takeover. Mr Mondello was the chief executive of ZipTel and is now a board director of Douugh. Advertisement In its 2020 recommendation, RSM endorsed the reverse takeover and is now the auditor for Douugh. In an ASX statement, Emerge Gaming said it will continue to implement the company’s existing strategy, and “deliver value to the subscribers on its platforms”. But that the company is focused on the deployment of its social gaming platforms via both B2C (business-to-company) and B2B2C (busines-to-busines-to-company) models, as well as rolling out a so-called higher-quality ‘AAA’ cloud gaming streaming product to the market in the coming months. “Central to this strategy is a greater emphasis on capital allocation and investment, increase in shareholder returns, driving growth in revenue, and continuing to build trust and support from its stakeholders.” Emerge Gaming said. Several former investors and market watchers have contacted the Financial Review about Emerge Gaming with concerns about its operations, including its relationship with Crowd1. One source – who is not invested and is not short the stock – also raised issues with its ability to stream “AAA” games through a cloud solution. “I personally cannot see how they can pull this off when competing with Google Stadia, Microsoft Project xCloud, Playstation Now & Nvidia’s GeForce Now (with Steam),” the source said. Advertisement “These four companies have the tech, human resources, finances, infrastructure, ‘connections’ to key decision makers and the most important thing being game licensing either inhouse game titles and/or licensing sorted with game developers. Stadia & Geforce Now requires the player to ‘buy’ the game. With the purchase of a game you are not a ‘Netflix of gaming’ as EM1 spruiks.” Emerge Gaming partnered with Singapore-based Cloudzen Pte Ltd under a licensing deal to access five AAA games developed by Cloudzen. AAA is a classification term used for games with the highest development budgets. Emerge Gaming previously declined to elaborate on product plans with Cloudzen. But Emerge Gaming has recently decided to establish an Australian registered special purpose vehicle, even though it does not offer its platforms in Australia. It told the ASX prospective offerings involving its joint venture partner, Cloudzen’s technology, would be considered in the future for Australian consumers. Carrie LaFrenz has more than 10 years' experience as a business journalist having previously covered healthcare, retail/consumer goods, industrials and agribusiness. She is based in our Sydney newsroom. Connect with Carrie on Twitter . Email Carrie at carrie.lafrenz@afr.com Michael Roddan is a Walkley Award-winning senior companies reporter based in Sydney. He is a former business and economics reporter for The Australian. Connect with Michael on Twitter . Email Michael at m.roddan@afr.com Save

ZipTel Acquisitions

1 Acquisition

ZipTel acquired 1 company. Their latest acquisition was Douugh on March 23, 2020.

Date

Investment Stage

Companies

Valuation
Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.

Total Funding

Note

Sources

3/23/2020

Series A

$2.5M

Reverse Merger

1

Date

3/23/2020

Investment Stage

Series A

Companies

Valuation

Total Funding

$2.5M

Note

Reverse Merger

Sources

1

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