Schools pay a sub fee to access the platform for a year to hire teachers. They typically do most hiring leading into the start of the school year but require the ability to hire through out the year. IS have higher teacher turnover rates in and through a school year. In addition, your statement is not true given there is little to no churn in schools signed up i.e. they don't "switch off" once they hire for the start of the year. As you say, it might be worth digging deeper yourself before questioning the quality of the ARR.

See here: https://www.eurekareport.com.au/investment-news/schrole-group-a-school-recruitment-platform/147523 Alan Kohler interviewing Rob Graham, Schrole Group's Founder and CEO, in June 2020 (two months ago): Excerpt from interview: AK: It’s possibly a good opportunity now to just explain your business model. You've got a recruitment platform and you get money from both sides: the schools pay you and the… RG: Candidates, yes. AK: …and the individual teachers pay you as well, is that correct? RG: Correct. Everything's an annual subscription base. Schools pay to be on the platform and that's a charge based on the size of the school with the number of teachers they have, and the expected amount of teachers that they'll turnover. And teachers have the opportunity to come on a platform for free but if they want to do anything like search for jobs, or get notified about jobs, they pay an annual subscription, and that's been very successful as well. We've had 6,000 teachers paying US$75 dollars in the last 12 months and that number is growing every year. AK: In your model, which is the chicken and which is the egg? RG: Well, I actually think it's funny, it’s probably more the candidates. The more candidates you have the more schools you can get. Having a really rich and deep candidate database is probably where everything comes from. It's not how we started. We started selling a platform to schools, but we sold it to really good schools and before we knew it we had 10,000 candidates on our platform and that became something to attract other schools. AK: Right. As long as you've got the candidates, you're saying that the schools have to be on your platform, is that correct? RG: Yeah. Well, look, I think we’re a really cost-effective solution for schools because they know every year what they have to pay for us. For other platforms, they'll have to pay a recruitment cost per teacher. And so that can be upwards of, you know, a percentage of revenue or a fixed fee, but it's certainly more expensive than using our platform. --- end of excerpt --- So, yes, it's clearly an annual fee, so schools can NOT "turn off" mid-year. I believe ARR is absolutely a valid valuation tool for SCL.

I don't follow SCL myself, but a quick look back did show that their last two placements were both to professional, sophisticated and institutional clients of Altor Advisory Partners Pty Ltd and Henslow Markets Pty Ltd (together, “Joint Lead Managers”). Schrole Group paid the Joint Lead Managers a capital raising fee comprising a management fee of 2% and a capital raise fee of 4% of the total placement amount for the April 2019 $1.25m raising, and in the case of the $800K August 2019 placement, SCL did not disclose the fees paid - but once again it was Henslow and Altor Capital that acted as Joint Lead Managers to the Placement. In April 2019 they released the details 3 days after calling for the trading halt. In August, it was 2 days after the trading halt was called for. If this is another placement to SI's, then it would likely be the same firms running the raising, but it could be a bigger one this time. The previous two were NOT underwritten. If they want to do a larger underwritten entitlement offer for instance, they might need a larger broking firm to run it, although I think Altor might be able to handle something like that as long as it's not too big. https://altorcapital.com.au/home https://henslow.com/ I guess all will be revealed by Wednesday.

Wednesday 13-May-2020: Schrole has received binding commitments from professional and sophisticated investors to raise $2.12 million (before costs) through the issue of 200 million shares at $0.0106 (1.06 cents) per share. The issue price represents a 21.8% discount to the 10-Day Volume Weighted Average Price. 134,003,960 Shares will be issued under Schrole’s existing placement capacity under Listing Rule 7.1 (First Tranche) and the issue of the balance of 65,996,040 Shares (Second Tranche) is conditional upon Shareholder approval being obtained at the Meeting. The First Tranche Shares are expected to be issued on Wednesday 20 May 2020 and the Second Tranche Shares are expected to be issued shortly after the Meeting. The Shares issued under the Placement will rank equally with existing shares on issue in the Company. Henslow Pty Ltd is the lead manager to the Placement. --- ends --- Nothing for ordinary investors there, as per their last two raisings.