The New Zealand-based job management software start-up for tradesmen, Fergus, has raised $3.5 million from Sydney fund Microequities Venture Capital as it looks to accelerate growth in Australia.
Founded by former plumber Dan Pollard when he became frustrated with the lack of visibility into the financial position of his plumbing business, Fergus removes the administrative burden on trades businesses, automating processes such as job allocation, timesheets and invoicing.
"I needed to be able to create a job, have it appear on someone's laptop or mobile device and for them to be able to enter their time on the job. I needed to find out how many hours a tradesman was working, versus what they were charging out," he said.
"At the time I'd been in business for about 17 years and the impact was quite amazing. With a company of 25 staff, in one year we did 6000 unique projects, made 3500 quotes, 7500 invoices for the work and over 15,000 iterative deployments, because many require more than one visit, and we had to process 30,000 supplier invoices.
"It's that sheer volume of activity that breaks most companies. How can you physically handle that much paperwork?"
Having spent three years developing the software internally, he was able to grow his business from four staff to 15 and then 25, having struggled in the past to ever take on more than a handful of people.
The software revealed to Mr Pollard that one of his star employees, who always invoiced customers on time, was actually charging the business for his commute time to each job but not his customers, meaning the company was losing significant amounts of revenue.
Mr Pollard raised $3.5 million in seed funding from wealthy investors in New Zealand to help develop the platform and two years ago he sold his plumbing business and became a full-time tech entrepreneur.
"I still call myself a plumber at my core. I've been on the tools since I was four years old and at my heart I will always be a tradie who stumbled into being a tech entrepreneur," he said.
"If you'd told me three to four years ago I'd been full-time on software and have thousands of companies as customers, I wouldn't have believed you."
Microequities co-founder Howard Leibman said the trades market was chronically underserved by current technology providers.
"We look specifically for such opportunities, where product-led entrepreneurs have established early revenues but need capital to expand their sales and marketing capabilities. We also have a strong bias towards founding teams with an industry-insider perspective," he said.
"Driven largely by word of mouth and strong customer advocacy, Fergus has built a dominant market position in New Zealand. The business is now growing very quickly in Australia, and early take-up in the UK and the US point to the potential to establish a truly global footprint."
Mr Pollard said his big vision was to solve the cash-flow problems for trades businesses.
He made the decision to raise capital from an Australian fund not just because of the company's local aspirations but because of the maturity of the venture capital market in Australia, compared withNew Zealand.
"Australia is just more sophisticated in terms of business. Investors expect you to be global from day one and they know the complexities of growing software companies and they bring a bigger world view," he said.
"The guys we're working with now have 20 investments and are looking for more. They bring the knowledge and experience of the Australian equity market, which we saw as being advantageous. Their experience is broader and deeper and that's what we want to tap into."
Read more: http://www.afr.com/technology/meet-fergus-dan-pollard-the-tradie-turned-accidental-tech-entrepreneur-20171205-gzz3ky#ixzz516jSWKEd
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