An Australian technology entrepreneur is among a handful of investors who have forked out $100 million to fund a local business that will take on the big banks.
Tyro Payments Limited, an Australian Eftpos provider that obtained a banking licence in August, has raised $100 million from Tiger Global Management in New York, TDM Asset Management in Sydney and Australian technology entrepreneur Mike Cannon-Brookes to fund the next stage of its ambitious growth strategy.
Tyro will use the new funds to accelerate its growth initiatives and new product development to provide innovative payment and banking solutions to its customers.
The group will look to compete with the big four banks in the SME lending space and is eager to leverage data from more than 14,000 businesses in Australia, for which it processes over $8 billion annually in transactions through its internally developed cloud-based platform.
In August this year, Tyro became the first Australian technology company to be granted a banking licence by APRA, allowing it to accept deposits and to advance money to Australian businesses.
Tyro CEO Jost Stollmann said the $100 million capital injection from three leading global investors combined with Tyro’s in-house cloud-based banking platform sets Tyro up well for the next stage of growth.
“Tyro is coming together with Australia’s 2.1 million small and medium-sized businesses, software and fintech companies to build a new ecosystem that is disrupting the established banks by offering better products and experiences,” Mr Stollmann said.
“SMEs are essential to productivity growth and job creation in our economy. We want to build a new banking ecosystem that allows SMEs in whatever business, – be it retail shops, pharmacies, medical practices, restaurants, pubs or hotels – to compete better.”
As part of the new funding, experienced retail businesswoman Catherine Harris will join Tyro as an independent board director from 17 December 2015. Ms Harris is an accomplished director with extensive retail experience as chair of Australia’s largest independent produce retailer, Harris Farm Markets.
She is also a commissioner of the Australian Rugby League, and director of The National Gallery of Australia, The Australian Ballet and the UNSW Australia Business School.
Tyro chairman Kerry Roxburgh welcomed Ms Harris’s appointment, saying she would bring new skills and perspectives to the board.
“Catherine Harris is one of Australia’s most astute business figures, who will bring enormous insight into the dynamics that drive a successful, retail business,” Mr Roxburgh said.
“Tyro has ambitious growth plans to be the natural home for Australia’s 2.1 million small and medium-sized businesses, and Catherine Harris will help drive that strategic oversight.”
Established 12 years ago, Tyro has built up a team of 150 software engineers to develop and launch new banking products.
Over the next three years, it plans to triple the number of software engineers to 450, with the aim of shaking up the Australian banking industry further, with a suite of new digital products that will save businesses time and money.
“Tyro is poised for breakout growth, driven by innovation and commitment to fair and transparent banking,” Mr Stollmann said.
“We will transform banking for SMEs and provide them with frictionless solutions tailored to their needs, so that they can concentrate on growing their business.
”We make no apology for attracting some of Australia’s top software engineers, attracted by our creativity, agility and ability to transform the country’s banking system.
“It is an exciting time.”
During the 2015 financial year, Tyro increased its gross revenue by 38 per cent, and added 94 new staff, taking its total staff count to 221. In addition, the group opened the Tyro Fintech Hub where like-minded entrepreneurs can interact and co-develop open application programming interfaces (APIs).