When I caught up with Figured CEO Paul Reid just prior to Christmas, heโd not long settled into a completely refurbished office in Aucklandโs CBD. What surprised me the most was the space for growth; hereโs a companyย that has grown incredibly fast โ from two to 20-plusย staff in less than a year โ and has ambitious goals for further growth.
Forty-three year old Reid is in his element โ the high-tech business space is his niche, he says.
In the pristine new, yet-to-be-christened boardroom, Reid explains how his corporate background in companies like NZ Post, MetService, CHH Forests, Air New Zealand and Ernst & Young, along with directorships in a number of high-tech companies, had set him up for his role at Figured. Some of those high-tech companies are engaged in leading edge creative projects โ Pukeko Pictures, for example, is behind the remake of the Thunderbirds TV series; VX Sports has masterminded the GPS in-fabric performance data technology utilised by some of the worldโs leading sports teams, including the All Blacks.
โThrough my involvement with these private companies as a director, I realised that my true calling was in the high-tech space โ rather than running a network of Postshop stores!
Reid acknowledges that the relationships and knowledge heโs gained through working with some of New Zealandโs top business leaders during his corporate years, has been a โhuge helpโ for where his career is now headed.
Reid has only been CEO at Figured since November 1st, having first invested in the company a few months prior. The companyโs flagship product is โFigured on Farmโ โ a cloud-based livestock reporting and cashflow forecasting tool released for general use in late October. The program fully reconciles with Xero and allows everything about a farmโs financial, stock and equity position to be tracked from any location. Although only the tip of the iceberg, well in excess of 300 farms have already signed up and a mixture of cloud-friendly accountancy firms have also joined as partners.
With a sales team in place and faith in the rural grapevine, Reid is predicting up to 16,000 farms will sign up over the next two years โ taking in both sides of the Tasman. โThatโs definitely achievable.โ
A major milestone has been bringing farmer-owned co-operative LIC (Livestock Improvement) on board as a channel partner and investor. The partnership provides enhanced information for farmers, and integrates the Figured on Farm accounting package with LICโs farm management software called MINDA.
โFigured enables the farming team to work together โ thatโs farmer, banker, advisor, accountant and those in specialised fields,โ explains Reid. โThere is one set of accounts, one financial forecast, and all participants can work off the same set of information in real time and on any device.
โItโs a collaborative tool that changes the way the farming team works together.โ
And itโs easy to use; just what tech-savvy, but time poor, farmers need, he says.
The forecasting and modelling features are what make the platform so appealing. Reid explains that, as the dairy payout forecast changes, the data can be instantly updated and farmers can immediately see how margins will be impacted in, say, six months time. โThey can instantly see their gross margin and bottom line, dollar-per-kg by every cost item,โ he explains. โSo theyโll know how much headroom they have. Theyโll know that if they make any changes, what the dollar-per-kg effect will be. It takes away that stress of not knowing.โ
The banks love that extra visibility too, he adds, especially when it comes to approving finance.
Satisfying the need
Having grown up on a southern Wairarapa farm, Reid instantly saw the potential for the product. โI got the idea and I saw the need. The defining moment was meeting some of the current shareholders and the original (MyFarm) creators of the software, sitting around the kitchen table and discussing things the old school way.โ
It was the sort of environment Reid was totally comfortable in and he was ready to go down this new path. As it turns out, at Figured he is divorced from the governance of the company, and views that as a positive. โHaving been on numerous directorships I personally find it hard constantly swapping CEO and director hats. Others can do it, but I quite like the distinction. They are very different roles, and I find it great to be challenged and critiqued by the board.โ
Reid has been encouraged by the feedback from farm owners and managers on Figuredโs product. โThereโs much more engagement around, not just the current performance of farms, but future performance. Theyโre now reviewing their financials on a monthly basis, and thatโs a big shift.โ
He says the next big development for the software will be the ability for farmers to compare their farmโs financial performance with other local farms that are prepared to share their data. This is performance monitoring on a much grander scale.
Figuring the future
While the focus is currently on building the New Zealand market, Reid says it is ultimately not big enough, and they have an Australian version due to be launched in March 2015. A cropping module is also planned โ an absolute must for the Aussie market, he says. The banks and a number of large accounting firms across the ditch are excited about the cloud offering, and Figured is currently recruiting staff for an office in Melbourne.
Beyond Australia, countries with a similar farming model to New Zealand, such as Ireland and the US, also hold promise, as do other farming-related sectors such as horticulture.
Reid says the key to managing a fast growing company like Figured is โsticking to your verticalโ.
โYouโve got to stay really, really focused,โ he says, โand not get sidetracked.โ
Youโd imagine thatโs the sort of advice that would go down well with their farmer customers too.
