An Otetto Group Company | Coffs Harbour, NSW | April 2026
$3.5M Bundled SAFE • $2.0M Debt Facility • $5.5M Total StackStrictly confidential. For discussion purposes only. This document does not constitute an offer to sell securities.
Living Canvas is Australia's first prefabricated hempcrete Structural Insulated Panel (SIP) manufacturer. We industrialise a material that has been proven for a decade in bespoke construction but has never been produced at scale in Australia. Our proprietary tilt-table vertical drying process transforms hempcrete from a slow, labour-intensive, site-cast material into factory-cured wall, floor and roof cassettes that arrive at site fully cured, with zero on-site curing time, and install as a complete building envelope in six days.
We are not a sustainability story. We are a manufacturing business with a structural cost, speed and regulatory advantage whose product happens to be carbon-negative. The founders are award-winning licensed builders with over 20 years of trade experience and a full-scale residential demonstration home already completed and occupied using the Living Canvas system across walls, floor and roof.
The raise is $3.5M of equity via a single bundled SAFE at a $16M combined pre-money enterprise valuation across two Otetto Group entities — Yieldtech Enterprises Pty Ltd (IP holding) and Living Canvas Pty Ltd (manufacturing and commercial). One cheque, one term sheet, proportional exposure to both the underlying IP and the operating business that commercialises it. The SAFE converts to equity in both entities on a qualifying event, with the investor receiving a blended 17.9% stake across both cap tables. Alongside equity, $2.0M of interest-only debt ($1.5M equipment finance, $0.5M working capital) sits inside Living Canvas. The combined $5.5M stack fully capitalises the Stage 1 Coffs Harbour facility build-out, 12 months of working capital and the Year 1 production ramp — with no reliance on any grant outcome.
The base case delivers 10 homes in Year 1, 35 in Year 2 and 48 in Year 3 at full facility utilisation. Year 3 revenue is $11.52M at a 39.2% gross margin, delivering $1.12M EBITDA. The model has been stress-tested across 15 downside scenarios — including stacked shocks — and remains solvent in every single one, with a base-case minimum quarterly cash buffer of $941K.
The opportunity is time-bound. The August 2026 NCC update raises minimum insulation, breathability and condensation standards that brick veneer and standard frame cannot meet without cost-additive workarounds. Embodied-carbon limits follow in 2027-28. Living Canvas sits on the right side of both regulations and intends to be the only Australian manufacturer at scale when that window opens.
Australian residential construction is structurally broken on four fronts at once. Build times of 9-14 months expose every project to weather, trade sequencing risk and defect rework. Material and labour inflation has priced first-home buyers and mid-tier developers out of viable project economics. Trapped moisture in sealed, non-breathable wall systems is the leading cause of mould and warranty claims post-handover. And the regulatory floor is rising: August 2026 NCC tightens thermal, condensation and breathability requirements, and embodied-carbon caps are scheduled to follow in 2027-28.
Conventional SIPs using EPS or polyurethane foam cores solve speed but fail the breathability and embodied-carbon tests. In-situ hempcrete solves performance but is too slow (30-45 day on-site cure) and too expensive (~$1,000/m²) to be a commercial product. There is no industrialised, performance-ready, carbon-negative panel system manufactured at scale in Australia today. That is the gap Living Canvas closes.
Living Canvas manufactures hemp-lime SIPs — walls, floor and roof cassettes — in a controlled factory environment using our proprietary tilt-table vertical drying process. Panels arrive on-site fully cured and installation-ready, eliminating the 30-45 day on-site curing window of cast-in-situ hempcrete. A complete building envelope installs via crane in 4-6 days.
Performance: R3.75-R4.25 thermal at 300mm, non-combustible and tested to BAL-FZ (the highest Australian bushfire classification), active moisture regulation that eliminates trapped-moisture mould pathways, zero VOCs, and approximately 110-165 kg of CO2 sequestered per cubic metre of panel for the life of the building.
The defensibility is not the hempcrete formula — hempcrete is not patentable. The defensibility is the industrialisation: the tilt-table manufacturing process, factory cure protocols, panel geometry, certification pathway, supply-chain lock-in with NSW hemp producers, and a founding team that has built with the material for a decade. We estimate competing Australian prefab hempcrete attempts are 12-24 months behind and lack the construction-operator DNA to close the gap.
Core product: hemp-lime SIPs with a structural timber frame and factory-cured hempcrete infill, designed to a 4.8m span for installation logistics and load manageability. Complete envelope coverage — walls, floor cassettes and roof cassettes — so builders do not stitch the system together from multiple suppliers.
The Ashby pilot home (Northern Rivers NSW) is a full-scale completed residential demonstration built entirely with Living Canvas factory-cured panels across walls, floor and roof. It verifies the manufacturing innovation at TRL 6 and functions as both proof of concept and active display home.
Regulatory pathway is dual-track and deliberate. For Phase 1 residential, Living Canvas panels are specified under engineered Performance Solutions under the NCC — a legal, widely-used pathway for non-standard materials, signed off project-by-project by qualified certifiers. BAL-FZ, thermal and acoustic performance claims are supported by third-party testing already completed. For Phase 2 commercial and multi-residential (2027-28), CodeMark certification is the target — funding for the full certification programme (CodeMark, FRL, acoustic, thermal, LCA, IP) sits inside a separate $1.22M NSW ETCF grant application currently in preparation, with certification treated as a mandatory de-risking programme regardless of grant outcome.
Manufacturing plant has been designed and quoted with a mechanical engineer ex-Boral, split into Stage 1A (production-critical equipment, $2.15M, funded by this raise) and Stage 1B (storage and timber fabrication, $762K, debt-funded). Full Stage 1 capex is $3.96M including engineering, commissioning and 15% contingency.
TAM: Australian house construction is a $90.1B industry in 2026 (IBISWorld), with approximately 111,000 detached houses completed annually (ABS). The building envelope — walls, floor and roof structure — represents approximately 25-30% of total build cost, placing the national envelope-system TAM at $12-15B/year. The prefabricated and modular construction segment within this is valued at AUD $9.0B in 2026, growing at 7.9% CAGR, with acceleration expected as the National Housing Accord's 1.2-million-home target by 2029 collides with persistent labour scarcity and rising regulatory load. Globally, the hempcrete market is valued at USD $570M in 2024 and projected to reach $2.24B by 2034 at a 14.9% CAGR, with Asia Pacific the fastest-growing region at 16.5% CAGR.
SAM: New detached housing in NCC climate zones 2-7 (NSW, VIC, QLD, TAS) where breathability, thermal performance and condensation management are critical design drivers. These states account for approximately 70% of national house starts (~78,000 dwellings/year). NCC 2025 — available for adoption from 1 May 2026 — mandates vapour-permeable membranes, improved roof-space ventilation and moisture-escape pathways in all climate zones, requirements that conventional brick veneer and standard frame cannot meet without cost-additive workarounds. The SAM for performance-grade panel systems is $1.4-2.1B/year in envelope value. Living Canvas is the only Australian manufacturer of prefabricated hempcrete SIPs with BAL-FZ certification.
SOM: At full Coffs Harbour capacity of 24,156 m²/year (48 homes/year), Living Canvas captures ~$11.52M of annual panel revenue — less than 1% of the SAM. The single-facility thesis is not "win the market." It is fully utilise one plant from a pipeline that already exceeds $10M of qualified demand. The SOM-to-SAM gap is the growth runway: each additional facility replicates the same economics and feeds the Yieldtech royalty stream. Multi-facility expansion is treated as Series A upside, not base case.
Living Canvas sells panels into two customer segments: architect-specified custom residential, and builder-direct repeat projects. Pricing is transparent and formulaic: $480/m² ex GST, with volume discounts tiered from 2% at $600K panel revenue through 5% at $1.8M+. The commercial promise: square metres in, price back within 24 hours.
Unit economics per m²: $480 sell price, $308 variable COGS (materials, labour, inbound freight — founder-verified April 2026 at the component level), $172 gross profit, 35.8% gross margin at current hemp input pricing ($1.80/kg). As iHEMP NSW fibre producers scale — Harrison sits on the board and has confirmed pricing commitments from producers coming online within 12-18 months — scale efficiencies reduce COGS to $292/m² and lift gross margin to 39.2% from Year 3 onwards.
Working capital is engineered around a 30/30/40 payment architecture: 30% on contract signing, 30% at production start, 40% on delivery. This pulls 60% of customer cash forward before a panel ships. At full capacity of 48 homes, that is $6.9M collected pre-delivery annually — a structural cash flow advantage that fundamentally separates Living Canvas from any builder or contractor paid in arrears on progress claims. This architecture is what makes the business model resilient: cash arrives before cost is incurred.
Scalability: the Coffs Harbour facility is a template. Once commissioned and operating at steady state, it becomes the reference design for additional nodes in NSW, VIC and NZ hemp precincts, funded from subsequent capital or operating cash — not this raise.
Pre-scale, but not pre-traction. The signals are qualitative and contracted.
The Ashby pilot home is complete: a full-scale residential demonstration built with factory-cured Living Canvas panels across walls, floor and roof. It is occupied, serves as an active display home, and verifies TRL 6 end-to-end.
Three signed preliminary contracts representing 2,203 m² of targeted panel supply are currently in the architectural design phase. These convert to binding panel supply contracts upon facility commissioning and completion of project-specific Performance Solution documentation. They are contracted design-phase engagements with demonstrated intent — not committed delivery contracts today.
Thirty-two early-adopter projects in pipeline across NSW, VIC, QLD and TAS — 4 in active design and pricing, 9 under specification review, 15 inbound enquiries — plus two flagship opportunities: Kangaroo Valley (~$20M residential) and Brewarrina (~$15M Class 9b commercial), together representing approximately 29% of Year 1 facility capacity.
The most commercially significant traction signal: the entire pipeline — 3 signed contracts and 32 qualified projects — has been built on approximately $5K of cumulative advertising spend. No paid media programme, no sales team, no marketing infrastructure. Architects, builders and owner-builders are finding Living Canvas and asking to specify it. The constraint on the business is not demand. It is production capacity.
This is the adoption curve at work. Living Canvas is currently in the innovator and early-adopter phase — the left tail of the diffusion curve. The people coming to us now are self-selecting believers who require minimal persuasion. As the NCC changes land in August 2026 and embodied-carbon caps follow in 2027-28, the market moves into the early majority phase: architects and builders who are compelled by regulation, not just drawn by curiosity. At that point, conversion rates improve and cost per acquisition falls simultaneously — the opposite of what happens to most businesses as they scale. We are building the supply-side infrastructure now so we can meet that demand wave when it arrives.
Industry validation: 19 established architect, designer and builder relationships; partnerships with SAHA, Other Architects and Elliot Marsh on three market-ready off-the-plan home models; four industry publication features (CO-Architecture, Habitus Living, Green Magazine, ArchitectureAU). Harrison holds a seat on the iHEMP NSW board. Phil Warner (co-founder, Eco Fiber) advises formally.
Sequenced, not scattered.
Phase 1 (0-18 months): Architect-led custom residential in NSW hemp precincts and the Northern Rivers, compliant via engineered Performance Solutions. The primary channel is direct architect engagement — not paid media. At approximately $1,000 per activated architect relationship (founder time plus materials and resources), Living Canvas can systematically build 20-30 active architect relationships in Year 1 at a total cost of $20-30K. Each relationship, once established, is capable of generating 2-3 projects per year at $240K revenue per project. The unit economics of this channel are exceptional — and the $5K/pipeline ratio already proves it works. The forward marketing budget of $260K is allocated primarily to systematising this channel: architect outreach, technical specification packs, CPD seminars, site visit facilitation and trade press presence. Paid media is a secondary activation layer, not the primary demand driver.
A 24-hour pricing response and a finalised technical pack are the two highest-leverage sales assets. A retained fire and thermal engineer will productise typical-assembly Performance Solution templates to reduce per-project specification friction.
Phase 2 (18-24 months): Commercial and multi-residential. Trigger conditions: CodeMark certification complete, one facility at 60%+ utilisation, and commercial reference projects delivered. Target customers already in conversation include SJB Architects (Blacktown Council project) and AJC Architects (GPS School).
Phase 3 (36-60 months): Product line expansion (acoustic panels, batts, boards, blocks) and geographic expansion via co-location with hemp-grower precincts in NSW, VIC and NZ. Category leadership and strategic exit optionality.
Living Canvas is not competing against hempcrete purists. It is competing against brick veneer, conventional timber frame and polyurethane SIPs.
In-situ hempcrete providers are not competitors — they validate the material and generate customer interest that we convert. Other Australian prefab hempcrete attempts exist (AHMC, OzHemp, HempBlock, RespiraBuilt, Hempanel, VivaHomes) — none combine factory-cured structural SIPs, a completed pilot home, construction-operator DNA and hemp supply-chain lock-in. We estimate a 12-24 month lead. Conventional foam-core SIP manufacturers compete on speed but fail the embodied-carbon test arriving in 2027-28. Brick veneer competes on price today, but each NCC revision closes that gap.
The honest risk: category leadership is not permanently defensible through IP alone. It is defensible through execution speed, cost position, certification moat and supplier lock-in. The window to establish that moat is 18 months. We intend to use it.
Harrison Marsh — Co-Founder and CEO. Licensed builder and accredited hemp builder. 15+ years in design-led residential construction. Invented and bootstrapped Living Canvas from concept to TRL 6. Relocated to the Northern Rivers to build and occupy the pilot home. Master Builders Association award winner. Executive Officer, iHEMP NSW.
Amanda Marsh — Co-Founder and Head of Marketing and Brand. Qualified interior designer. 10+ years across construction, design and sustainable materials. Leads architect engagement, specification pathway and media strategy. Secured four industry publication features. Previous Executive Officer, iHEMP NSW.
Chris Ball — Co-Founder and Executive Chairman. Licensed builder, 15+ years in high-end residential construction, manufacturing operations and business leadership. Founded and scaled multiple construction businesses including a $7M residential building company. Currently completing MBA.
Nicholas Tindal — Technical Lead. NSW Statutory Mechanical Engineer. Owns mechanical design, plant auditing, systems implementation and commissioning risk for the Coffs Harbour facility.
Daniel Hamilton — Head of Sales. 15 years building scalable sales teams and processes. Owns architect outreach and B2B pipeline conversion.
Advisory: Phil Warner (Eco Fiber co-founder; hemp industry pioneer); capital-raise advisors Craig and Serena; mechanical engineer ex-Boral on facility design.
Critical execution hire budgeted in Year 1: a dedicated Production Manager at $150K/year. This is the single most important operational hire post-close and is the primary de-risking mechanism for the Year 2 ramp from 10 to 35 homes.
All figures ex GST. Base case uses current verified COGS of $308/m² for Years 1 and 2. Year 3 incorporates validated scale efficiencies (bulk purchasing, hemp hurd price reduction via iHEMP NSW commitments, process optimisation) bringing COGS to $292/m² and gross margin to 39.2%. All numbers reconcile to the financial model workbook.
| Metric | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| Homes delivered | 10 | 35 | 48 |
| Revenue | $2.40M | $8.40M | $11.52M |
| Gross profit | $0.86M | $3.01M | $4.51M |
| Gross margin | 35.8% | 35.8% | 39.2% |
| EBITDA | ($1.99M) | ($0.04M) | $1.12M |
| Min quarterly cash | $941K | — | — |
Key assumptions: $480/m² sell price; 500 m² average home; fixed overheads of $2.80M/year (Years 1-2), fully itemised across 25 line items including Production Manager at $2,885/week; Stage 1 capex $3.96M; 30/30/40 payment terms with 60% of revenue collected pre-delivery.
The model has been stress-tested across 15 scenarios, including single-variable shocks and stacked combinations. The minimum quarterly cash position is $941K in the base case, above $200K even in the stacked apocalypse scenario (production slip plus payment delay plus flat hemp pricing), and $2.84M minimum in the bull case. Breakeven sits at approximately 58% facility utilisation — 28 homes per year. The model remains solvent in every scenario with only the funding described in this memorandum.
R&D Tax Incentive: Living Canvas's novel tilt-table manufacturing process and factory cure protocols are eligible for the Australian R&D Tax Incentive (R&DTI). For companies with aggregated turnover under $20M, the R&DTI provides a 43.5% refundable tax offset on eligible R&D expenditure — meaning cash back from the ATO regardless of profitability. This window is available throughout Living Canvas's entire pre-$20M revenue phase, estimated to be Years 1 through 4-5 on the base case trajectory. At $500K-$900K of annual eligible R&D expenditure, the R&DTI represents approximately $200-390K of additional cash per year — or $800K-$1.5M over the ramp period. This has been excluded from the base case to maintain conservatism but represents material upside that costs nothing to pursue beyond annual registration with AusIndustry.
Items excluded from base case and treated as upside: AIIGP grant ($1.99M, Jul 2026), NSW ETCF certification grant ($1.22M, Jan 2027), R&D Tax Incentive ($200-390K/year), and carbon credit revenue from 2029 onwards.
The Otetto Group operates through two purpose-built entities with distinct roles, designed to protect the core IP from operational risk while giving investors direct exposure to both the IP asset and the commercial operation that monetises it.
Yieldtech Enterprises Pty Ltd owns all intellectual property: the tilt-table vertical drying process, know-how, trade secret protections and the forthcoming patent portfolio. Parent holding: Verge Holdings (Harrison Trust 44%, Amanda Trust 28%, Christopher Trust 28%).
Living Canvas Pty Ltd is the manufacturing and commercial operating entity, holding an exclusive worldwide royalty-bearing licence from Yieldtech. Parent holding: Otetto Holdings (Harrison Trust 33.33%, Amanda Trust 33.33%, Christopher Trust 33.33%).
The $3.5M equity component is structured as a single bundled SAFE at a $16M combined pre-money enterprise valuation ($10M Yieldtech, $6M Living Canvas). One investment, proportional conversion into equity in both entities on a qualifying event. Blended investor stake on conversion: 17.9% (16.7% in Yieldtech, 20.0% in Living Canvas).
This round is the only window through which outside investors can acquire equity in Yieldtech. Once closed, the Yieldtech cap table is closed to further external capital other than strategic IP contributors.
Inter-company royalty: Living Canvas pays Yieldtech 2% of net panel revenue in Year 1 (up to 60% capacity), 3% in Year 2 (61-80% capacity), and 4% from Year 3 onwards (81-100% capacity). The tiered structure protects Living Canvas cash flow during the capital-intensive ramp phase and aligns Yieldtech's upside directly with operating performance. Any change to the royalty rate above the documented tiers requires investor consent — this protection is documented in the SAFE side letter.
Investors receive a board observer seat on Yieldtech Enterprises and standard information rights (quarterly financials, annual audited accounts, material event notification).
Total funding stack: $5.5M.
Use of funds: Stage 1 facility build-out (production line, fit-out, machinery) $3.96M; working capital and Year 1 operating expenses $1.0M; contingency and ramp buffer $0.54M. Of the $3.5M bundled SAFE, $2.0M is allocated to Yieldtech and $1.5M to Living Canvas. The $2.0M debt funds operational capex, working capital and ramp directly.
Debt terms: $1.5M equipment finance at 9% p.a., 7-year amortising, interest-only Year 1, secured against plant. $0.5M working capital facility drawn Year 2 Q1. Combined annual interest expense approximately $180K, tax deductible.
Milestones funded by this raise:
Target close: May 2026. The round is structured to close before or with the AIIGP grant decision — not after — to preserve investor confidence that the raise is not grant-dependent.
Three structural items are open. They are included here for transparency. All three must be resolved before the data room opens.
FLAG 1: IP Assignment to Yieldtech — Urgent, Pre-Data-RoomThe tilt-table manufacturing process, brand, trade secrets and all associated IP must be formally assigned to Yieldtech via executed IP assignment agreements before the data room opens. Without this, the $2.0M Yieldtech allocation is investing into an entity that does not yet legally own the IP it purports to hold. Status: to be completed before data room opens.
FLAG 2: Founder Vesting Schedule — Required, Pre-CloseNo vesting schedule is currently documented for the three founders. Standard expectation for a raise of this size is a 4-year vesting schedule with a 1-year cliff. Without this mechanism, investors have no structural protection against founder departure. Status: to be drafted by legal counsel and executed before investor meetings commence.
FLAG 3: Governance — Board Seat, Information Rights and Royalty Consent — Required, Pre-CloseInvestors receive a board observer seat on Yieldtech and a consent right over any royalty rate change above documented tiers. Standard information rights (quarterly financials, annual audited accounts, material event notification) to be documented in SAFE side letter. Status: to be decided by founders and documented pre-close.
This memorandum is not a pitch deck. Material risks are stated explicitly.
Execution risk on first-facility commissioning is the single largest exposure — mitigated by pre-raise mechanical engineering, a Stage 1A/1B equipment split, and a dedicated Production Manager hire budgeted in Year 1.
Contract conversion risk is material: the three signed preliminary contracts are design-phase and convert to panel supply contracts on facility commissioning — mitigated by a 32-project qualified pipeline and a sales process built around 24-hour pricing response and productised Performance Solution templates.
Certification risk is real — CodeMark is not started and is the target of the 2027 ETCF programme — mitigated by the dual-track pathway where Phase 1 residential proceeds under engineered Performance Solutions while CodeMark progresses for Phase 2.
Hemp supply risk exists at current $1.80/kg pricing but does not constrain the Year 1 and Year 2 base case, which does not rely on the Year 3 price improvement.
Regulatory timing risk is mitigated by unit economics that already work at today's prices — regulatory tailwinds are accelerants, not prerequisites.
Competitive risk is acknowledged; defensibility is execution speed, supplier lock-in and certification moat, not IP alone.
Inter-company concentration risk: Living Canvas is the sole current licensee of the Yieldtech IP. A failure at Living Canvas would materially impact Yieldtech's royalty stream unless alternative licensees are secured — mitigated by Yieldtech's carve-out right to license into non-competing fields and territories.