Having spent time working at Prospa and Valiant Finance, Nathan Carroll had some first hand experience in how to build a successful fintech.
But like many entrepreneurs, he felt the lure of building his own company from the ground up.
And with co-founder Nick Glynn, the pair have now launched Quicka — a payments service which provides an intermediary service for small businesses to get paid faster.
The company is one of 12 startups which successfully pitched and obtained $100,000 in seed capital from the Antler Australia venture capital program.
That followed a 12-week selection program, after which Carroll and Glynn were included in the first cohort of 71 founders to build and then pitch a business idea.
Speaking with Stockhead, Carroll said one of the benefits of the Antler format is that it put a refreshing focus on individual talent.
“From what I saw with most startup incubators at the pre-seed stage, they want you to have a pretty concrete idea that’s up and running,” he said.
“But Antler was one of the few VCs I’ve seen that’s focused on people first. Let’s find talented people, and if you throw them in a room it will create some interesting ideas that will turn into businesses we can then invest in.
“They give you the tools and allow you to pressure-test different ideas with good concise feedback.”
Having made the initial cut, Carroll and Glynn brainstormed different ideas with the rest of the group but kept coming back to same idea around fast payments.
They also found their respective skill-sets, as Glynn’s technical development skills aligned with Carroll’s experience in strategy and marketing.
Carroll said the duo’s professional background in other successful startups helped strengthen their pitch when it came time for Antler to choose which ideas to invest in.
“We identified a problem and a way to solve it — as every startup does — and ultimately they believed we were the correct team to actually execute on that,” he said.
Time is money
At the heart of the idea behind Quicka is time.
“We spoke to around 60 businesses, and the common pain point was the amount of time they spend chasing invoices,” Carroll explained.
“They still get paid the vast majority of the time, but they’ll typically have to prioritise, so if it’s $5k and $500, they’ll spend all their time on the larger amount and leave the smaller one alone.”
To alleviate the problem, Quicka takes an intermediary position and pays the invoice up front so companies can manage their cashflow.
It’s a similar model to QuickFee (ASX:QFE), the payments platform for professional services firms which listed on the ASX earlier this year.
In return for assuming the debt, Quicka generates revenue by charging a flat five per cent fee on each debtor amount.
The company’s first clients were sole traders in the building and construction industry and marketing consultants in areas such as web design and social media management.
“From there we evolved to other businesses in larger supply chains such as mining and supermarkets,” Carroll said.
Quicka now has a “couple of dozen” clients processing payments regularly through the platform.
“We’re getting a couple of new sign-ups almost every day, on-boarding them and learning from what they want. And we’ll continue to do that for the next 12-18 months,” he said.
In the early stages of growth, Carroll said the company isn’t planning another large VC round for its next capital raise.
Instead it will focus on the right angel investors with the expertise and networks to help foster organic growth.
The founders are hoping to position Quicka as a simple fast-payments solution ahead of a “big change” in company invoicing trends in the Australian market.
“Big businesses have been squeezing smaller contractors into so many 90 and 120-day repayment terms,” Carroll said.
“But speaking to industry we think it’s on the verge of a shift, and hopefully we can be the tipping point to tip the scales back in favour of small business.”