READCLOUD LIMITED — Capital/Financing Update 2018

Feb 6, 2018

ACN 136 815 891 ABN 44 136 815 891

Level 1, 426 Glen Huntly Road, Elsternwick, Victoria, 3185

Contact:

Phone: +61 3 9692 7222 Email: contact@readcloud.com

Board of Directors:

Paul Collins, Non- Exec Chairman Lars Lindstrom, Managing Director Darren Hunter, Executive Director

Company Secretary:

Melanie Leydin

Securities on Issue:

RCL: 80,000,000 ordinary shares RCLO: 19,999,995 options

Website:

https://www.readcloud.com/

READCLOUD LIMITED (ASX:RCL) COMMENCES TRADING

ReadCloud Limited (ASX:RCL) commences trading today on the ASX

• $6 million capital raising heavily oversubscribed
• Strong growth in school and users for 2018

ReadCloud is an Australian education technology company that provides a leading digital eLearning solution to Australian secondary schools. Following rapid growth in the last 2 years, ReadCloud's software platform was used by 50 schools in the school year 2017 with 21,800 users and the Company is expecting to double user numbers in 2018.

ReadCloud Limited (ASX: RCL) today commences trading on the Australian Securities Exchange (ASX) following a successful capital raising of $6 million led by Patersons Securities Limited to fund the company's growth initiatives in the Australian school market. The capital raising was heavily oversubscribed by a range of institutional and retail investors with Thorney Investments taking a cornerstone position in the Company. The Company lists on the ASX with a market capitalisation of $16 million.

READCLOUD LIMITED (READCLOUD)

ReadCloud is an Australian education technology company that provides a leading digital eLearning solution to Australian secondary schools.

Students and teachers can share notes, questions, videos and weblinks directly inside the eBooks, turning the eBook into a place for discussion, collaboration and social learning, and substantially improving learning outcomes.

The school's curriculum is accessible in one App, across multiple platforms and devices, regardless of the school's choice of publisher.

ReadCloud had 50 schools and 21,800 Users using its platform as at 30 June 2017 and the Company is expecting to double User numbers in 2018.

READCLOUD LIMITED BOARD

ReadCloud was co-founded and is now led by CEO Lars Lindstrom who has extensive tech start up experience. Previously a Partner in LundXY (the first investor in Skype) and the CFO/Co–Founder of Nyhedsavisen which, within one year, became the most read newspaper in Denmark. Lars spent his first 10 years working in Investment Banking/M&A working for Deutsche Bank and Rothschild.

CIO Darren Hunter was the Co-Founder and CIO of IWL which was listed on the ASX and provided Westpac and NAB with their online equity broking capabilities. IWL grew into an ASX 300 company with over 500 employees and was eventually acquired by CBA for $373 million.

The Board of Directors is Chaired by Paul Collins who has been extensively involved in the start up and subsequent ASX listing of two successful FinTech companies. He was Co-Founder of IWL and in 2004 he was Co-Founder and Executive Director of Managed Accounts Ltd which listed on the ASX in 2014 (ASX:MGP).

COMMENTS

Chairman Paul Collins said: "The strong investor support for ReadCloud through the IPO process is testament to the quality of the ReadCloud eReading platform, the experience of the leadership team and the rapid growth of the business."

"I believe the strategy of further software development and additional sales and marketing staff will position ReadCloud for further growth by targeting the 2,700 secondary schools and 1.6 million full time secondary school students in Australia."

CEO Lars Lindstrom said: "Our purpose at ReadCloud is to assist schools transition to digital curriculum whilst delivering software tools that can help make students smarter and teachers better."

FIRST HALF FY18 (H1 FY18) TRADING UPDATE

H1 FY18 highlights for ReadCloud include a substantial increase in the direct school channel, as well as growth in new reseller schools and an increased user penetration in existing schools.

The company has begun its recruitment process for sales people nationally and software development personnel to support the growth of the business and will also invest in digital marketing to increase awareness of a business which has to date been grown solely by 'word of mouth'. The funds from the company's listing on the ASX will be used to further accelerate sales growth, product development and increase business development initiatives.

OUTLOOK

ReadCloud will release its financial results for the half year to 31 December 2017 in February 2018 in accordance with its financial reporting obligations as an ASX-listed company.

As of 31 January 2018, 68 schools have been successfully on-boarded on the ReadCloud platform representing nearly a doubling of contracted users over 2017 and with a strong pipeline, the Company expects to on-board more schools before the financial year end.