Laybuy: from a pair of jeans to the ASX
AUCKLAND: Gary Rohloff will have held a virtual ringing of bell yesterday as the buy now pay later business he founded around the kitchen table with family three and ahalf years ago listed on the Australian sharemarket.
The former retailing stalwart, who has managed wellknown brands Number One Shoes, Warehouse Stationery and Ezibuy, began the business in 2017 in this country after a conversation with family about a safe and easy alternative to credit cards to buy a pair of jeans.
‘‘That led us to thinking about how we could use technology to bring the traditional layby model into the 21st century.’’
Laybuy now has more than 5500 merchants signed up to use its service in New Zealand where it has 40 staff, as well as a presence in Australia.
It is also on a strong growth trajectory in Britain, where the market is double the size of New Zealand and Australia combined.
Its initial public offer on the ASX has seen it raise $A80 million ($86 million) through a $A40 million primary issuance and a $A40 million selldown by existing shareholders which values the company at $A246 million.
Mr Rohloff, who is managing director, will retain a 30% stake in the business after its listing.
In addition to the capital raising it has also secured a $20 million debt facility with Kiwibank to fund its New Zealand and Australian operations and an £80 million ($158 million) debt facility to fund growth in the United Kingdom.
Mr Rohloff was sanguine about not being in Sydney for the bellringing.
‘‘It would have been really terrific as a family to go across to Sydney and be part of that milestone but hey it’s a different world these days.’’
Asked what it meant to get to this point, he said it was little surreal.
‘‘When we see the ticker live on the exchange it will become a reality. But at a personal level for the family we are really proud of what we and the entire Laybuy team has been able to achieve in three and ahalf years.
‘‘For most people who have started businesses, your nose is so close to the glass that you don’t often step back and just go — wow — that is pretty cool and we need to do that more often.’’
Covid19 restrictions have proved a boon to buy now pay later businesses as people have been forced to shop online, but they also nearly derailed the company’s listing plans.
Mr Rohloff came back to New Zealand in January after spending 18 months in the UK to set up the business there. His plans were to enjoy the New Zealand summer and list the company in June.
‘‘I was on our first investor roadshow in midMarch and I had to come back from San Francisco because Covid was breaking out. I was en route to New York.’’
He came back to New Zealand and the country went into lockdown. Then capital markets went into meltdown.
‘‘We postponed our listing to November. Within a month of that meltdown markets were recovering rapidly and our advisers said you really need to pull this forward, we need to list in September.’’
It had been an extremely busy time for the business as it prepared for the IPO and raised the two debt facilities.
‘‘Our finance team had three years of accounts to prepare and an audit to manage over three years because that was what was required to list on the ASX, all within three months. Most people do one of those things.’’
‘‘It’s been a heck of a ride for that threemonth period and in among that the world has been beleaguered with this dreadful pandemic. It’s been a heck of learning experience on a whole lot of fronts.’’
During that time he had also hired 25 new staff and had not met any of them in person.
‘‘I think it has taught all of us, particularly someone like me, who has been in the corporate world for nearly 40 years where you were expected to go to the office every day, clearly we haven’t been able to do that.
‘‘It has meant a different way of operating. I always look to hire people for attitude and values. That doesn’t change.’’
Mr Rohloff was now focused on expanding into the UK market.
‘‘Our plan when we started the business was always to look to dominate the New Zealand market, demonstrate the portability of what we were doing by taking it across to Australia. And then as quickly as we can get up to the UK because it is white space up there — it was in 2018 — we were the only ones doing what we were doing.’’
Laybuy was now one of only three major players in the UK.
The UK market was ‘‘pretty sophisticated in terms of online shopping as a contribution to total retail’’.
There, online shopping made up 20%25% of total retail, compared with about 15% in New Zealand.
Ultimately Mr Rohloff wanted to see Laybuy become a global brand like Kiwi businesses Xero or Allbirds.
‘‘We did this as a family because we wanted to see if we could . . . create a global brand from New Zealand. Something to be proud of and to tell grandkids about one day. I think that would be a really cool thing to be able to do.’’ — The New Zealand Herald