IPO Watch: SME-focused fintech Propell set to land on the ASX next week

The ASX is set to welcome another fintech in Brisbane headquartered firm Propell (ASX:PHL).

The company is a cash-flow solution focused on SMEs offering forecasting tools, credit options and instant invoice payment solutions.

“The problem we’re trying to solve for our customers is they struggle to manage cash flow,” CEO Michael Davidson told Stockhead.

“We’re approaching that problem holistically and providing them with a range of financial products to solve that problem as well as business insights.”

It currently services over 430 SME customers, a number that has been growing substantially in the past 12 months.

“It was a really interesting year, we launched our platform right in the middle of COVID so you could’ve thought it was the best or the worst time to launch,” Davidson said.

“We did give a lot of our existing clients who were going through hardships payment holidays and delayed payments of loans to allow them to get through the period.

“But equally we saw a heap of businesses having the best year of their lives. We had a bicycle business in Perth that was absolutely destroyed – they got to the point where they ran out of stock in their business because everyone wanted a bike.

“You hear a lot about a two-speed economy, it really has been that some sectors are flying and others are doing it difficult.”

Why Propell is listing

Propell has raised $5 million at 20 cents per share as part of its ASX IPO.

Davidson says the time is right to list and his priorities are for customer growth and further product development.

“We decided on going public because it allows us to raise the capital this time – and our decision has been validated we were six times oversubscribed for this IPO round – but it sets us up for the next phase (of growth),” Davidson said.

“If we do deliver on our plans and hit some of these big milestones we’ll be strong to raise in the future.

“And listing gets you tangible benefits you don’t get (while being) private.

“There’s a lot of credibility being listed and a recognition from customers and businesses that listed companies are forward which is critical in the finance space where people are trusting you with their money.”

Propell’s company on the ASX

Arguably the closest comparison is QuickFee (ASX:QFE) which acts as payment intermediary for services firms in the legal and accounting professions.

It offers an online portal that allows customers to pay when and how they want, reducing the lag times on late payments and smoothing out cashflows for the service providers.

It listed in June 2019 at 20 cents and is currently at 35 cents per share.

There are also several lending stocks such as Plenti Group (ASX:PLT), MoneyMe (ASX:MME) and Wisr (ASX:WZR) although they focus on the personal space.

At Stockhead, we tell it like it is. While Plenti and MoneyMe are Stockhead advertisers, they did not sponsor this article.