Kaikoura-based school app maker nears US licensing deal

First profitable year for bootstrapped startup.

The maker of an app for schools to communicate with parents says her company is close to closing a licensing deal in the US.

In 2014, Kaikoura mother-of-two Sharlene Barnes saw opportunity in schools’ often poor attempts to deliver newsletters, and wrangle permission slips, absentee notices, school calendars and contacts and the like.

There were various online offerings but many schools didn’t have the money for even modest subscription and hosting fees or, if they did, lacked the skills to use them.

Her solution was Skool Loop, a parent communication app for schools, available in Apple and Android versions.

While teachers won’t give its name any awards for spelling, Skool Loop is free to use, and offers free support, thanks to the fact it’s bankrolled by ads that feature in school newsletters.

Into the black
The founder says the emphasis is on making the ad user-friendly. They are all static, with no annoying pop-ups, and they feature local businesses.

Ms Barnes says her company’s annual revenue has reached $1.2 million, and that it’s just had its first profitable year.

It now has 800 schools on its books, with 11 to 14 being added a week, she says. She’s targeting 2500 overall.

She now has 15 staff, split between offices in Kaikoura and Rangiora (the latter was opened after the 2016 Kaikoura quakes).

There are no issues running a nationwide business from Kaikoura, she says. The local staff are loyal. Many are parents working glide time.

The 50-something Ms Barnes, who had spent her career in advertising, initially put $10,000 of her own money into kicking off the app development process. She first mapped out the app, with the help of her grown-up children. 

She shopped it around a dozen web developers but none wanted to take it on until she found Christchurch-based Activate Design. The total bill for version one came to around $80,000, with early ad sales funding the balance.

A 'clueless' raise
Ms Barnes says spending on upgrades has been continuous ever since. Two years ago, she needed outside funding to accelerate expansion.

She describes herself as “clueless” about the capital-raising process. After searching around online, she decided to spend a few hundred dollars to place a profile on the New Zealand Investment Network site.

She had many replies, and ultimately went with one from the US and one from Hong Kong, who together chipped in $150,000.

She attempted to vet her prospective investors via Google but could only get so far. Her lawyer and accountant advised her not to take on the Hong Kong investor but she says she changed her mind when the investor pointed out that it was he who was taking the risk with her. In the final event, she was very happy with both outside investors.

Harder yakka in Oz
It hasn’t all been plain sailing. An approach to the Ministry of Education to adopt Skool Loop for all schools was rebuffed. She says it wasn’t because of the advertising element; just that it wasn’t seen as a priority.

And while Skool Loop launched into Australia in February, it has so far proved much slower going. Schools are better funded and the teachers more tech-savvy, she says, making it less fertile ground.

Ms Barnes says she chose a licensing model for the US market because she didn’t want to raise more capital and give up of her company in the process. She says the deal – which will involve a percentage of revenue – is close. She plans to follow it up with a similar licensing deal in the UK.

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