Australian listed software company Reckon (ASX: RKN), together with minority shareholders, has agreed funding for nQ Zebraworks to continue to pursue cloud growth.
As a result it has participated in a $7 million preference share issue by nQueue Zebraworks Inc, a Reckon subsidiary and the holding company for the Legal Group, trading as nQ Zebraworks.
Reckon’s commitment is $5.9 million, which includes Reckon’s pro rata entitlement and a portion of the shortfall as a result of certain minority shareholders not contributing.
Reckon will contribute US$1.6M on issue of the preference shares, via conversion of existing debt, with the balance of the commitment at call by nQueue Zebraworks Inc. The balance is anticipated to be fully called by the end of 2026.
The balance of the capital raising was through existing nQueue Zebraworks Inc. shareholders, including nQ Zebraworks CEO, Bill Bice and CRO, Ken Bassham.
Reckon’s contribution will be funded through earnings from existing operations and the company’s existing debt facilities.
“We have committed significant resources to the development of nQ Zebraworks’ cloud-based technology and the build out of its sales and support functions over the past few years,” Reckon Group CEO, Sam Allert, said.
“We remain confident that the addressable market for the BillingQ offering justifies our continued investment. Leading indicators are positive with an increase in orders taken over 2023 including our largest individual annual recurring revenue sale.
“Zebraworks to pursue the higher growth strategy that commenced at the end of Q3 2024 with an increased headcount in sales, support and development. This funding is expected to support the business through to the end of 2026.”
nQ Zebraworks is a document and billing workflow company that leverages the power of its Zebraworks cloud-based integration platform to deliver digitalisation, billing and collections automation, cost recovery and analytics solutions for law firms and government and corporate legal departments.
nQ Zebraworks CEO, Bill Bice, said the additional investment in nQ Zebraworks will allow the compamy to pursue the market opportunities for BillingQ.
“It is an exciting time to lead the business as we look to capitalise on years of development effort and drive exponential sales growth in the near term.”