Speaking to AccountantsDaily, Rob Nixon, CEO and founder of Panalitix, a cloud-based business advisory tool for accountants, said the capital raised will be used to fund expansion plans, particularly in the North American market.
Mr Nixon said the limited share offering will be restricted to current clients of the business, a group of around 440 accounting firms with around 900 partners in total.
“The reason we wanted to do that is we want to create a shareholder base which is our user base so that we've got them as loyal promoters and supporters for the life of the business,” he said.
From this, Mr Nixon said there will be key benefits that will help the business grow.
“They are going to give us promotion because many are in networks around the world and around Australia," he said.
“We can say to them 'you’re in a network, how do we reach your colleagues in Canada or your colleagues in Perth?', wherever they happen to be.”
The offer was first announced to Panalitix clients at a conference in Bali last week, while clients who did not attend will formally be presented the opportunity in a webcast today.
From conference attendees alone, Mr Nixon said there have already been 102 expressions of interest ranging from $50,000 to $500,000, more than enough to oversubscribe the limited offering.
Despite overwhelming interest Mr Nixon said the Panalitix board has already decided to continue with the 20 per cent offering for $8 million but did flag the possibility of future capital raisings.
“We had that discussion as a board and we said 'Ok, we can see we could raise $20 million in one go here', but we elected to say no, we are going to raise $8 million, we are going to use the money for expansion and if we need another capital raising then we will,” Mr Nixon said.
“There’s clearly interest there for it but right now we are sticking to the $8 million for 20 per cent.”