MYOB has taken a strategic stake in Kounta, which makes cash register software, as the accounting software maker ramps up efforts to corner the small business payments market ahead of the big banks and US venture Square.
Details of the multimillion dollar deal were not disclosed by either company, but it is understood MYOB took a minority stake in Kounta and will work to develop a co-branded product that integrates Kounta’s point-of-sale software with MYOB’s accounting ledger. The news follows MYOB buying Dovetail and rival Intuit buying Invitco and shows the ongoing opportunities for Australian start-ups in the accounting software space.
Kounta founder Nick Cloete says the deal would help the Sydney-based start-up expand across MYOB’s customer base of 1.2 million businesses.
“We’ve got a lot of work to do still in Australia and New Zealand but, being cloud-based, have already started growing globally in the US and the UK, and we want to further fuel that growth all over the world,” he says.
Kounta’s software, which also integrates with rival accounting software maker Xero, is used in upwards of 1000 cafes and small businesses, primarily in Australia, but extending to the likes of the United States, the United Kingdom and a night club in Helsinki, Finland.
“We figured if we could invest in them and get closer to them on the integration side, we could provide more of an holistic solution,” says MYOB general manager of connected services, Andrew Birch.
MYOB has increased efforts in the payments space, recently launching a credit card reader for smartphones. Birch says the accompanying app had been downloaded 1500 times since it launched.
But in the point-of-sale space alone, the companies face tough competition from New Zealand company Vend, which says it has 10,000 clients, and attempts to enter the local market by Square, the US payments company started by Twitter co-founder Jack Dorsey.
“The main piece of software that runs the store is the point-of-sale; the problem is traditional legacy systems are installed on an actual device. It’s an industry ready to be disrupted,” Cloete says.
This article originally appeared on BRW