Building a Robust Business in Australia: Investorist CEO Jon Ellis (Part 6)

Sramana Mitra: In 2015, your entire strategy was focused on Australia, China, and UK?

Jon Ellis: It was. It was until we had our A round funding.

Sramana Mitra: I was actually coming to that. You raised money in 2015?

Jon Ellis: Yes, in the middle of 2015.

Sramana Mitra: Tell me about that.

Jon Ellis: We came to the realization in the early part of 2015 that we had a huge opportunity with our platform, but that huge opportunity needed quite a bit of money. We set about raising funds. We didn’t give ourselves enough time to raise money which was a bit silly. I was a bit naive and thought the fundraising process would be quicker than it was. We went out to users of the platform and other friends in the industry, and raised $2.5 million from 24 individuals.

Sramana Mitra: This was in Australia?

Jon Ellis: One person from the UK and everyone else from Australia.

Sramana Mitra: Was your first funding equity financing or convertible debt?

Jon Ellis: Equity. We’ve only ever done equity and ordinary class share.

Sramana Mitra: So you raised $2.5 million from 24 investors, right?

Jon Ellis: Yes, on a $19 million pre-money valuation.

Sramana Mitra: How did you find these 24 investors?

Jon Ellis: When your platform services the property development industry, you’re quite lucky.

Sramana Mitra: That’s where the question comes from. Did you raise money from your customers?

Jon Ellis: A lot of the money was raised from our customers.

Sramana Mitra: At that point in mid 2015 when you raised this Series A, what revenue run rate were you at?

Jon Ellis: At that juncture, we were doing AUD 300,000 per quarter.

Sramana Mitra: What happened after you got the Series A? What were the next major moves that you made?

Jon Ellis: At that point, we doubled our staff all over the world. We employed lots of people. We went from about 20 to 40 people, and we increased our operational capabilities and employed a marketing manager and people in tech. We started scaling our platform. More importantly, we also started market research and scoping into the USA.

We opened an international tab on our site. We allowed users to list property in any country they wanted to do all over the world at a significant discount. We thought that we’ll just let them do what they want to do. We spent six months gathering information. At the same time, our revenues were rapidly increasing.

Sramana Mitra: What were the metrics at the end of 2015? At what revenue did you close at?

Jon Ellis: We were achieving around AUD 200,000 a month.

This segment is part 6 in the series : Building a Robust Business in Australia: Investorist CEO Jon Ellis
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