A freshly listed startup backed by Sir Owen Glenn, is aspiring to follow in Xero’s footsteps and become the next New Zealand software company to help thousands of small and medium-sized businesses internationally.
“If you’re not aiming for that, why get out of bed?” Black Pearl founder and chief executive Nick Lisette said on the Herald’s Stock Takes podcast.
The company, which went public in late 2022 via a compliance listing, sells software to other small businesses to help fuel their marketing strategies, especially using email.
It launched a service called Pearl Diver in March that collects data from visitors to a business’ website, including their name and email address, to use in follow-up targeted advertisements.
Currently 50 businesses in the United States were subscribed to the service, each paying between US$198 and US$1300 per month - a tiered pricing model that’s “cheap as chips,” according to Lisette.
“We have to say, when we’re speaking to the American clientele, ‘cheap as Taco Tuesday’.”
The company earned $1.4m in subscription revenue in the year to the end of March, but made a $7.2m annual net loss.
Lisette said its cost was “the whole secret” to cracking its target market of cash-strapped small business owners and keeping them subscribed.
“You want people paying you each and every month.”
It planned to add new features to Pearl Diver which could attract a higher price.
Lisette said most of the customers he’d pitched its software service to in the US said it was a “no brainer”.
However, he’d learned to focus on selling to smaller businesses - the big American companies soaked up too much resource.
“We got a couple of enterprise clients and then we got thrashed around like a rag doll, because you’re a little company at the mercy of this massive entity.”
Black Pearl was now “sticking in its lane” and serving smaller businesses, typically with less than 200 staff.
“As a New Zealand company ... we’ve got better empathy with the plight of a small to medium-sized business.”
Its other software offerings focused on email signatures.
The company was issued a please explain notice by the NZX regulator NZ Regco in December after its share price fell 68 per cent in four days.
Its share price was sitting around 43 cents this week, down 60 per cent from its listing price of $1.08.
Black Pearl Group’s shareholders include Sir Owen Glenn with a 5.8 per cent stake, and the Accident Compensation Corporation with a 3.1 per cent stake, according to Companies Office records.