Melbourne, Australia – December 2024: Reckon Limited (ASX: RKN) has announced a US$4.5 million (AUD 7.0 million) funding commitment to nQ Zebraworks, a subsidiary of Reckon and the holding company for its Legal Group trading as nQ Zebraworks. This additional investment will drive the company’s expansion into cloud-based solutions and accelerate its growth, particularly focusing on the BillingQ offering.
Investment Overview:
- Reckon’s Commitment: Reckon will contribute US$3.75 million (AUD 5.9 million), which includes both its pro-rata entitlement and a portion of the shortfall due to certain minority shareholders not contributing.
- Funding Structure: Reckon’s investment is structured as a preference share issue, with US$1.6 million being converted from existing debt, while the balance will be called by nQueue Zebraworks Inc. by the end of 2026.
- Capital Raising Participation: The remainder of the funding was contributed by existing nQ Zebraworks Inc. shareholders, including CEO Bill Bice and CRO Ken Bassham.
Strategic Purpose:
- Cloud Growth Focus: The funding will support the expansion of nQ Zebraworks’ cloud-based technologies, particularly BillingQ, and fuel its growth strategy that began in Q3 2024 with an expanded workforce in sales, support, and development.
- Positive Market Indicators: According to Reckon CEO Sam Allert, the company has seen strong performance in 2023, including record annual recurring revenue sales, and remains confident that the addressable market for BillingQ justifies ongoing investment.
- Future Outlook: The additional funding will enable nQ Zebraworks to pursue a higher-growth strategy and capitalize on market opportunities in the near term.
CEO Comments:
Bill Bice, CEO of nQ Zebraworks, expressed excitement about the investment, highlighting that it would empower the company to capitalise on years of development and drive exponential sales growth.
Regulatory Approval:
- The ASX granted Reckon a waiver from ASX Listing Rule 10.1, allowing the company to acquire preference shares without requiring shareholder approval.
This strategic investment reflects Reckon’s commitment to nQ Zebraworks’ cloud-based offerings and its continued focus on expanding its market share in the legal technology sector. The funding aims to sustain business growth through to the end of 2026.
