Brisbane-based mobile payments startup Sniip has joined forces with online accounting software provider Xero to deliver real-time billing to small and medium-sized businesses, after raising $3 million in funding in late 2016.
The partnership with Xero adds to Sniip’s growing number of relationships with larger organisations and co-founder Damien Vasta says being “flexible” and making sure your product solves a pain point in a potential partner’s businesses is key to securing high-profile deals.
Founded in 2013, Sniip is a mobile-based payments application that allows its users to store their payment information in a “secure digital wallet” and then recall that stored data to make payments; a service that saves users the ordeal of continually entering complicated financial details, according to Vasta.
The software also allows users to pay their bills within seconds by scanning a QR code at the bottom of an invoice, rather than using BPAY technology, which Vasta says is time-consuming and “not attractive” for users looking to pay their bills via mobile.
“We saw that as a big problem … the next generation of bill payers will not have PCs: they will do everything on mobile. We [Sniip] are developing solutions that cater for the next generation of consumers and payers,” he says.
The deal with Xero will mean Xero customers will have access to Sniip’s platform to receive, view and pay bills in real-time, and those transactions will be integrated with the customers’ existing accounting system.
The partnership comes as Sniip sets its sights on raising a fresh round of capital later this year and doubling its team of 14 within the next six months, according to Vasta.
Sniip raised $3 million in funding late last year from high-profile Brisbane investors, including former rugby league player Darren Lockyer, co-founders of Wotif.com, the Brice family, and former deputy chief executive of Fortescue Metals, Russell Scrimshaw.
The startup has also locked in relationships with Brisbane City Council, Toowoomba Council, Gympie Council and Queensland water-service provider Urban Utilities.
More names may well be added to that list in the future as Vasta says Sniip also intends to expand its offerings, which are currently being utilised by over 10,000 users, to cover “all aspects of the consumer payments spectrum.”
“We believe that Sniip should represent making payments on a mobile easily — that means every type of payment, whether it be paying a friend, paying a bill, buying a product,” Vasta says.
How startups can secure high-profile partnerships
For Vasta, flexibility is the secret weapon for startups looking to secure major partnerships.
“Be prepared to be flexible in the way you need to work with big players,” Vasta says.
“Come up with a solution and come up with a way that it can be implemented with relative ease.”
Vasta encourages startups to position their product as solving a crucial problem within the organisation they are trying to join forces with.
“I think that a general rule for startups is [to] make sure whatever you’re working on creates a solution to an existing problem. If it doesn’t then the ability for a startup to gain the attention of the larger organisation they’re working with becomes infinitely more difficult,” he says.
“You’re in a competition to prove that you’re a superior product, which is really tough when you’re a new kid on the block.
“Establish [to your potential partners] that the work you’re doing is not necessarily something that’s been contemplated but that needs to be considered as a key component to fixing a problem,” Vasta advises.
Fintech set for disruption
Vasta says that this collaboration with Xero, which is set to come into effect in October, will also employ blockchain technology to “offer an unprecedented level of security and flexibility”, to its users, noting the emerging technology is “integral to the Sniip platform”.
Blockchain has been touted as a key emerging technology in the future of Australian fintech, with parliamentarians increasingly expressing an interest in the space, and Vasta says Sniip will be “announcing more about partnerships in regard to blockchain in the coming weeks”.
Vasta says up until recently “a lot of the development of fintech has been dominated by the banks”, which he believes has been problematic because consumers may perceive these improvements in technology as simply methods to “acquire customers to that banking brand” rather than being “designed to benefit them as consumers”.
He believes fintech startups are ideally placed to disrupt the banking sector because they are “designed around creating better products than [what] currently exists in the marketplace through banking instutions”.
These startups, he says, “have the ability to solve a specific problem..and offer that to the customer directly, as opposed to as a part of a [bank’s] pitch to get your business.”