Freeagent sets out hiring plans after maiden numbers
● Newly listed Edinburgh firm looking to take on additional software engineers
software specialist Freeagent is planning to ramp up its headcount after revealing a surge in revenues with its first set of results as a listed company.
The Edinburgh-based firm, which floated on London’s Alternative Investment Market (Aim) last month, said revenues for the six months to the end of September jumped 36 per cent to £3.6 million, helping gross profits rise 38 per cent to £3m.
However, pre-tax losses widened to £1.3m, from £433,000 in the same period last year, which the company said reflected investment in customer acquisition, employees’ share options costs of £512,000 and unrealised losses on a US dollar loan facility of £200,000. Freeagent develops accounting software aimed at the UK’S five million “microbusinesses” and has almost 52,000 subscribers, up 18 per cent on a year ago. The firm currently employs more than 100 people, and chief executive Ed Molyneux said it was planning to take on “significantly” more software engineers in Edinburgh during the first half of next year.
He told The Scotsman: “That’s going to be an interesting challenge for us. We’ve seen the technology jobs market really flourish over the last couple of years, with businesses like Skyscanner and Fanduel doing a lot of hiring, but engineers are in short supply.”
Molyneux, a former RAF fighter pilot, said that Freeagent’s initial public offering (IPO) was a “significant milestone” for the business, which he helped to co-found in 2007.
He added: “The acceleration of growth into our accountancy practice channel has continued to progress well for us, and that’s still our fastestgrowing market. Accountancy practices are really starting to embrace digital and the cloud as a way of doing business with their clients.”
The company is also launching a commercial collaboraaccounting tion with a high street bank, the name of which is being kept under wraps for now, in a move aimed at winning more sole trader and micro-business customers.
“By focusing on this part of the market we think we’re doing something a bit different,” Molyneux said. “Some 95 per cent of all businesses in the UK are these micro-businesses with fewer than ten employees.”
He added that the second half of the firm’s financial year “has started positively and we are confident we will report further significant progress within our full-year results, consistent with market expectations. As a newly-listed public company, we are especially pleased to report strong performance in our first set of interim results.”
Analysts at house broker N+1 Singer said: “The group will be driving continued growth by investing in customer acquisition, particularly in the key accountancy practice channel and by investing in product development as it looks forward to be strongly positioned for the Making Tax Digital agenda from HMRC.”