Straker Translations raises $6m with cornerstone from David Kirk's Bailador
Online translations company Straker Translations has raised $6 million to help fund its international expansion, including $4 million from David Kirk's Bailador Investments.
The capital is being used to fund Straker's global growth through its online and direct sales force, and possible acquisitions. Other new investors include $1 million from Kong Hong-based investor Scobie Ward, and $1 million from several high net worth New Zealand-based investors.
Company founder and chief executive Grant Straker said he had been looking for more than just money from investors and was excited to have Bailador Investments as a cornerstone investor with a 15% stake held in convertible preference shares because of its mix of experience, connections and understanding of companies at Straker's stage of growth.
Bailador, run by former Rugby World Cup winning Mr Kirk and former Champ private equity director Paul Wilson, listed on the Australian Stock Exchange last year in an $A40 million IPO. The fund is investing in emerging online businesses in Australia and New Zealand with proven business models, established revenues, and good growth prospects.
Mr Wilson, who will join the Straker board, said the founders had built a great business in the rapidly growing hybrid machine and human translation market. It is ranked among the top-100 translation companies in the world with more than 10,000 customers. "Straker fits our investment mandate perfectly," Mr Wilson said.
Straker generates $8 million in revenue using a cloud-enabled platform that allows 24/7 translations to be delivered easily and with speed for more than 80 source and 100 target languages. It has 55 staff globally and production centres in Auckland, Barcelona, and Denver.
The company has had a 65% compound annual growth rate for the past four years, has been profitable this year, has no debt and derives more than 80% of revenue from outside New Zealand and Australia.
"The nature of work is changing and we have an advanced technology platform, global services infrastructure, big data, and a hugely scaleable crowdsourcing model that presents us with numerous growth opportunities in a $US36 billion market," Mr Straker said.
The company had initially been seeking less money as a precursor for a potential listing on NZX's new NXT market when it went into the latest fundraising round, he said. The company won't list on the NXT because of concerns it may end up undervalued, though a main board listing was still likely in future, Mr Straker said.
Straker's platform has also been integrated into a number of other company's portals in various countries, with a further 1000 firms identified as potential targets, though capital was required to fund the developers needed to do the integration work, he said.
Straker and his wife Merrin, who also works in the business, have taken an undisclosed amount off the table in this latest fund-raising round to "pay off our mortgage" and their stake has been diluted from 43% to mid-30%, he said.
Other shareholders in the Auckland-based company include Milford Asset Management with an 8.62% shareholding.
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