Gavin George: Starting WorkflowMax and the sale to Xero
WorfkflowMax is, by all accounts, a New Zealand tech startup success story. The company was created in early 2007 by Gavin George and Chris Spence, received investment from Xero in 2010, was purchased by Xero in 2012, and now boasts over 5,000 regular users. No big deal.
On the off chance that you’re unfamiliar with WorkflowMax, it’s a popular all-in-one job management software solution that allows service-focused businesses such as creatives, engineers, consultants, and architects to manage all operational aspects of their companies. Using the cloud-based tool, business owners are able to manage leads, quotes, time sheets, invoices, and even staff and job profit reporting. With its comprehensive list of features and seamless integration with Xero, the SaaS application has sky-rocketed in popularity and businesses from all over the world are using WorkflowMax to increase productivity in their organisations.
Gavin George, who wrote to us from a holiday rest stop in France, said that he and Chris Spence created the company because they encountered many small service businesses who were utilising their accounting platforms to manage their jobs. Although accounting solutions are good at the financial aspects, they generally fall short of what a service business needs to effectively manage their clients. WorkflowMax is Chris and Gavin’s beautiful cloud-based solution to the problem they saw SME’s having.
During the company’s first 18 months, Chris and Gavin both had to do contracting work to pay the bills. Chris looked after WorkflowMax’s product development and Gavin built out the go to market strategy, sales, marketing, and customer support sides of the business.
“As we slowly brought on more and more customers, we were able to reduce our contracting hours and start to earn our salary from the business,” Gavin recounted. “Within two years of first starting, we were profitable and had our first employee.
“Sales continued to accelerate from there – we ran a pretty tight ship and only brought on additional staff when we felt they were absolutely needed.
“Consequently, the company was highly profitable from an early stage.”
Although WorkflowMax doesn’t market itself as a solution that’s specifically built for accounting firms, the company realised early on that the application was a good fit for their job-focussed businesses. This was largely influential in Xero’s decision to strategically invest in and eventually purchase WorkflowMax.
Shortly after WorkflowMax was built, many Xero accounting partners began using the platform to run their businesses and voiced their need for a tax return filing feature to be built into the application. In an effort to appease their partners, Xero asked WorkflowMax to build tax return filing into their solution, and Xero funded the build in return for a small stake in the business.
“The tax development was hugely successful,” Gavin said, “and with more and more Xero partners starting to use WorkflowMax as their Practice and Tax management solution of choice, it made logical sense for Xero to acquire the rest of the company.”
“We had a choice to make,” he explained. “We could continue doing what we were doing and we would continue to grow incrementally, or we could take on significant investment to really accelerate the growth of the business and take advantage of the massive opportunity available to us.
“Xero made a compelling offer that made sense financially to us as owners and also made sense for the future growth of WorkflowMax while ensuring that we continued to help drive that growth.”
In 2012, Xero raised $20 million from existing shareholders and purchased WorkflowMax for $2 million in cash and $4 million in shares. The company retained the majority of its original team, and has grown significantly since the acquisition.
The WorkflowMax story is certainly one of success, happy endings, and fresh beginnings, but Gavin says that if he were to start over knowing what he knows now, there are some things he would have done differently.
“We would have invested more strongly in our idea and found additional capital at the outset to drive that growth,” he says. “However, given the old adage ‘you don’t know what you don’t know,’ it made a lot of sense for us to move as we did, test, and learn more as we worked through the process.
“I am extremely proud of what we have achieved and looking back, I firmly believe that we did the best we possibly could have at the time, given our experience and knowledge,” Gavin adds.
The future is looking bright not only for WorkflowMax, but for Gavin too. Right now, he is firmly committed to driving the growth of both his startup and Xero, and he says that he is enjoying being a part of the journey. When the time is right, Gavin says that he can see himself starting a new venture and experiencing the joy of growing something from scratch all over again.
His advice to the new startups who are just beginning to “make it” is simple: ask a lot of questions.
“No one has all of the answers,” Gavin explains. “You know your business better than anyone else, trust your vision and trust your instincts. And above all else stay dedicated and work bloody hard to achieve your goal.”
“The one key factor in our success was our pure single-mindedness and absolute determination to achieve what we believed in.”Tags: accounting, Gavin George, Rod Drury, WorkflowMax, Xero