Tech challenges: funding and growth

Resources Corner

It’s nothing new to hear Australian tech entrepreneurs complaining about a lack of government support, but this week Communications Minister Malcolm Turnbull conceded, in conversation with Alan Kohler, that there was plenty of work to be done to make the space more prosperous and globally competitive. 
 
Listing on ASX was touted as a key opportunity, with IPO costs on the local boards more affordable than listing on Wall Street exchanges like the NASDAQ. 
 
Commentary
 
An example of fund-raising success on the ASX is Freelancer Limited (ASX:FLN), and this week Finance News Network spoke with Matt Barrie, the CEO and Chairman of the online global outsourcing company, to discuss its strong first half results. 
 
FNN: What were the highlights and how did they compare to last year?
 
Matt Barrie: We had a phenomenal first half and in fact, acceleration in the key metrics over last year. So we’re at record debt revenue of $16.8 million, which was up 41 per cent year on year. That’s an acceleration from the full year financial 2014 results, which was up 39 per cent. Gross payment volume, the cash in the marketplace, we beat analyst expectations by a fair amount.
 
We had again, a record first half of $64.1 million dollars, which is up 30 per cent year on year. And that beats the full year for 2014 of 23 per cent.We added one million new projects in contest posted on the site. This is a phenomenal acceleration of 43 per cent a year on year, up from last year. So we had a really, really good first half, so really, really happy.
 
FNN: During the half you also acquired a number of businesses, including Escrow.com. Can you explain what it does and also how it fits into Freelancer?
 
Matt Barrie: So Escrow.com is just like Paypal.com, right. So it’s a payment system and this is fantastic, because freelancers that earn money on the site now, will be able to send money to anyone in the world, whether SMS it, email and so forth. So it really increases our ability for our users to send payments to each other, which is great. So it’ll increase the commerce on the Freelancer marketplace.
 
FNN: Can you tell us about the project with NASA to help design parts for a robot in space. What is involved and why is it significant for the business?
 
Matt Barrie: This is phenomenal. So NASA came to us a few weeks ago and they’re using Freelancer, to crowd source solutions to complex problems that astronauts are facing in space. So in particular, we’re doing a whole bunch of things like 3D modelling of objects that a Robonaut r2 robotic astronaut, which has been on the space station since 2011, is going to use to train itself for image recognition. So it can do activities that astronauts would normally do.
 
You can see the full interview here.
 
Results season…
 
OzForex Group (ASX:OFX) shares shot up over twelve per cent on news the company has grand plans for an acceleration strategy. The currency exchange website will change its name to OFX as it goes hard on global business aiming to double its revenue to $200 million by 2019. The strategy is the brain child of new CEO Richard Kimber who also announced a new marketing chief at the company’s AGM yesterday.
 
Gentrack Groups Limited (ASX:GTK, NZX:GTK) says it has signed a big contract with an Australian utility provider. The deal is to upgrade its Velocity software to the latest in billing and CRM solutions to support the utilities electricity, gas and water utility products by the end of 2017.The deal follows another contract with a UK water utility firm signed last month.
 
Cochlear Limited (ASX: COH) shares have posted their biggest decline in more than two years after its FY 2015 profit result disappointed. The global biotech announced a net profit of $145.8m for the year ended June 30, a 56 per cent increase on the previous year. But the figure fell short of analyst expectations, the consensus forecasting about $156.9m. The company sold almost 27,000 of its hearing implants over the past financial year, up 3 per cent on 2014. Cochlear will pay a final fully-franked dividend of $1, bringing the year's total distribution to $1.90.
 
Carsales.com Limited (ASX:CAR) will spend up to $9 million to buy a 65 per cent stake in Mexican auto website Soloautos. Carsales says the Mexican market is attractive as it is the second largest economy in Latin America with nearly 50 per cent internet usage among its 120 million people. Existing owner Jose Ramirez will retain 35 per cent in the company and continue as CEO. 
Shares in carsales.com last traded 1.29 per cent lower at $10.69.
 
NewSat Limited (ASX:NWT) will be wound up just four months after going into administration. Marcus Ayres and Stephen Parbery of PPB Advisory have been appointed as liquidators, after failing to find buyers for the embattled satellite company’s remaining assets. Shares in NewSat Limited last traded in March at 11.5 cents.  
 
Novogen Limited (ASX:NRT) has lodged 2 new patents to cover its ATM drug technology platform. The new patents expand on earlier patents and allow Novogen to begin and own a manufacturing process for the technology. 
 
Quickflix (ASX:QFX) say they have brokered a deal with a Shanghai-based film and TV company to join their businesses and form a global streaming platform for the distribution of Chinese film and TV content into China as well as other international markets.