42. ELMO Talent Management Software

Revenue: $16.6 million
Growth: 67.7%
Founders: Manuel Garber, 74, and Danny Lessem, 49
Head office: Bondi, NSW
Year founded: 2002
Employees: 106
Industry: HR technology
Website: www.elmotalent.com.au

While the focus of many initial public offerings in the last few years has been on technology startups, ELMO Talent burst onto the scene this year looking to raise $25 million – 15 years after it was first founded.

The company, founded by Manuel Garber and chief executive Danny Lessem, is looking to become an end-to-end solution for human resources management, including recruitment, performance and leave management.

The founders noticed most businesses only offered part of the solution rather than a full, comprehensive offering – and the company was dabbling with cloud technology in the early 2000s before anyone else was.

“Today, our software’s advanced ability to automate and streamline HR processes in real-time, on any device, is delivering tangible benefits to over 500 clients across government, corporate and education sectors,” Lessem says.

Today, ELMO Talent turns over more than $16 million a year and over the past three years, has recorded revenue growth of 67.7%.

The company gained a massive win when it was the first unified HR software provider to integrate with the Australian Taxation Office. That need to stay in front of technology trends and provide a scalable solution has kept the company on its toes; the business spends 15% of revenue and 25% of its workforce resources on research and development.

Yet this year’s IPO – while successful – was a costly exercise. It brought a new level of reality to running the business for Lessem.

“We experienced first-hand the expensive cost of raising public capital, mainly due to regulatory and compliance costs, which were also administratively heavy,” the founders say.

“Large costs included hiring an underwriter and key advisors to manage the IPO, raise capital, roadshow to prospective buyers, and develop a company prospectus.”

The need to answer to another stakeholder group – shareholders – has kept the business lean and operating efficiently, but the founders say it’s important to walk a thin line between that and speed-to-market.

“While it’s important to have preferences, goals, and a strong vision, also accept the need to be flexible and adaptive – this could be the difference between success, slow death, or a short shelf life,” they say.