Australian software startup PractiFI has secured a $3 million investment to open a new North American HQ, as co-founder and chief Glenn Elliott puts the startup’s international growth solely down to customer service.
The investment, from Microequities Venture Capital Fund, will primarily be directed towards populating PractiFI’s Chicago office to service its growing US customer base.
Founded in 2013 by Elliott and co-founder Adrian Johnstone, PractiFI is a Software-as-a-Service platform designed to help wealth management companies put customers at the centre of their operations, and thereby improve both client relationships and compliance.
“When you put the customer genuinely at the heart of the business … it turns the whole industry on its head,” Elliott tells StartupSmart.
PractiFI has a team of 23 people, and around 1,000 clients in Australia, New Zealand, the US and Europe, a number that’s growing by 5% to 10% each month.
The startup is working to a revenue run rate of about $3 million, says Elliott, who says these figures are based on pre-investment numbers and he expects to see them go upwards from here.
Having only bagged its first US customer earlier this year, PractiFI is opening its Chicago office after a “whirlwind of activity”, says Elliott.
The founders travelled to the US to showcase the platform late last year, but Elliott admits he didn’t expect business there to pick up quite as quickly as it did.
“We designed PractiFI from the ground up to fit the needs of the wealth sector globally, but it’s not until you really test it out with clients in other markets that you know for sure,” he says.
“It was incredible how well it resonated — it really exceeded our expectations.”
Following the fact-finding trip, Elliott was surprised at how good a fit the product already was for the American market.
“We thought we would come back looking to develop a range of features to fit the market there. Turned out we already had them,” he says.
“We got some early wins on the board, and then the referrals really started to come in.”
The funding from Microequities Venture Capital Fund will be dedicated to putting a team on the ground in Chicago. Rather than taking an aggressive sales stance in the States, the plan is to put a “customer success” team in place to service the demand that’s coming through organically.
“At the moment, it’s a matter of keeping up,” says Elliott.
As is often the case with SaaS platforms, Elliott says, if you keep your early customers happy, “they tell each other”.
In fact, the most important lesson Elliott has learnt as a startup founder and chief executive is that “in those really early stages, the number one thing you need to care about is really thrilling your customers to bits”, he says.
“Almost nothing else matters,” he adds.
It may seem costly, and founders may be concerned about how that strategy will scale, but if you’ve got an idea that early clients like, “do everything you can to excite those customers”, Elliott says.
Worrying too early about international expansion, growing your team and your next integration is “a complete distraction”, he adds.
“You as a founder have to be completely focused on that customer success.”
If early customer are happy, they will refer new customers, Elliott says, and the business will grow by itself.
“And then you will figure out what you have to do next,” he adds.
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