Straker buys US company, updates on ASX plans
IPO prospect Straker Translations has made another offshore purchase, acquiring Elanex, a San Francisco-based language services provider.
Founder and chief executive Grant Straker won’t comment on the purchase price but says Elanex has 35 staff, clients across the US, Europe and Asia and annual revenue around the $6 million. It specialises in technology, retail, energy, financial translations and over-the-phone interpretation services.
Post-deal, Straker’s annualised revenue run rate as a group will be close to the $20 million mark, the chief executive says.
He’s targeting break-even about the first quarter of 2018.
The Elanex buy follows Straker’s purchase of Dublin-based Eurotext (annual revenue: $2.5 million) in October last year.
Mr Straker says he’s on the prowl for further acquisitions, using a war chest supplied by David Kirk’s Bailador, which has invested just under $10 million across two rounds, the most recent in November (Companies Office records show Bailador now owns 14.68% of Straker Translations, making the ex-All Black captain’s investment firm the second biggest after Straker family members).
Mr Straker is still aiming to take his company public, but he now says the timeframe is an ASX listing within the next 12 months, pushing out his earlier target for an IPO this year. He says the key reason is to give his company time to digest its new acquisitions. He expects to appoint an advisor shortly and to begin pre-IPO activity this calendar year. His target market cap for the listing is $100 million.
The chief executive says his company’s artificial intelligence smarts give it an edge on free options such as Google Translate and are helping it gain in a crowded commercial market.
He estimates that with its $20 million revenue, Straker is now one of the top 20 translation players worldwide.
The Elanex deal takes Straker’s total headcount to just under 100. It has more than 10,000 customers in more than 20 countries and earns 80% of its revenue outside Australasia.
He says e-commerce clients – especially those exporting to or importing from China – are his company’s fastest growing segment.