Adelaide telecoms startup Uniti Wireless has secured $5 million from the South Australian government’s Future Jobs Fund to more than double its workforce and take its NBN alternative across Australia.
Founded in 2014 in a bid to provide a faster and more reliable alternative to the National Broadband Network (NBN), Uniti Wireless raised $3 million in a pre-IPO funding round in March last year.
Since then, while it hasn’t actually gone ahead with an initial public offering yet, chief financial officer Peter Wildy tells StartupSmart the business has seen significant growth.
Over the past 12 months, Wildy says the startup’s customer base has grown by 130%. And over the past two years, revenues have grown 175%.
Now, it plans to use the $5 million in funds to create around 200 jobs in its engineering and software development, customer support, sales and marketing teams, as it continues its rollout in Adelaide and Melbourne, while also fueling an expansion to Sydney, Brisbane and Perth.
According to Wildy, a lot of the startup’s growth has come from customers that are “disenchanted with the NBN”.
“We get a lot of customer enquiries and signups just because of that,” he adds.
A lot of the startup’s marketing strategy focuses on this point, he says, with online marketing, flyers and letter-drops in areas where there is either no NBN available, or slow NBN.
“It’s a better alternative, and an alternative that’s available now,” Wildy says.
Equally, a lot of the startup’s business comes from word-of-mouth.
“We have some very happy customers,” he adds.
The $5 million comes as an “endorsement of our business and our business model”, Wildy says, but also shows the “government backing South Australian business through the Future Jobs Fund”.
“To be selected is quite pleasing,” he says.
The funds consist of a $3 million loan and a $2 million grant, and was secured following a “fairly rigorous assessment program”, Wildy says.
That process included negotiations of contracts, business plan assessments, scrutiny of financial statements, forecasting models and customer acquisition models.
“They want to know they’re going to get some of their money back,” Wildy adds.
Uniti Wireless is also still gearing up to an IPO, and some of the funds will be directed towards “making sure we’ve got everything prepared and aligned and ready to go”.
While Wildy doesn’t give any indication of the revised timeframe, he says the startup is waiting for “just right market conditions, and right business performance conditions … we’re making sure we’re ready”.
For other startups thinking of applying for government grants to fuel their next stage of growth, Wildy says “it can’t be seen as a handout”.
Any grant funding should be seen as “an endorsement of your business model” and proof that the business is “able to be self-sustainable”.
“Being cash-flow positive and profitable is ultimately the goal for all of us,” he says.