ASX-listed Cre8tek, which owns Sydney fintech startup Flamingo, has announced it is opening up a $5.5 million capital raising round.
Flamingo’s product uses web-chat, web-forms and machine learning to improve customer experience and engagement on financial and insurance business websites.
Cre8tek, which became a tech company via the reverse listing of Global Agenda Technologies in January 2016, took on Flamingo in a similar way last November.
The $5.5 million will consist of a $3.5 million placement to institutional and sophisticated investors and $2 million via an entitlement offer, with Otsana Capital and Ironside Capital involved in the deal.
The company said in its ASX announcement that the money raised would be used “to fast track the implementation and scale up” of Flamingo into US and Australian customers, as well as “explore opportunities in other verticals and markets such as Asia”.
Flamingo entered KPMG’s mLabs accelerator in July last year. By November, when the startup raised $3 million for its reverse-listing and ended up with a market capitalisation of $23 million, founder and chief executive Catriona Wallace had already earmarked the US as a territory to target.
“The average quote-to-sales conversion in the American insurance industry is between 15 and 20% for the call centres, but online that falls to 1 to 3%. The reason for this is customers are experiencing decision-making fatigue and simply move on,” she said at the time.
“Our system can actually guides customers through complex decision-making into quotation and payment seamlessly, this increases online conversation rates and can make a tangible difference to the bottom line of the companies we are working with.”
Flamingo has an office in New York City, but is headquartered at startup hub Stone & Chalk in Sydney.