RightWay Limited is one of New Zealand’s rapidly expanding bright companies, founded in 2011. They offer a different accounting experience – focused on small business customers, using cloud based tools to create the fastest growing accounting and advisory business in NZ.
We talked to their CEO, Greg Sheehan.
What do you do and how is it different than traditional accountants?
Small business owners, by and large, are serviced by small accountants, and most of them are suburban accountants who just focus on getting tax returns done.
We feel that small business owners also need help with strategy, getting their business models right, building their brands, understanding how to build sales pipelines if they were in that sort of market, understanding how to build their teams, as well as all the financials stuff – cash flows with the banks, understanding their margins, and doing tax returns.
Our claim to fame now is that we’re the fastest growing accounting firm in the country, by a number of different measures – new customers, staff number, growth up – we will be, by Christmas this year, we have 40 staff, numbers of offices, we’ve got 12 regions that we’re operating in now, and now we’re now looking at Australia.
Most accounting firms don’t grow that fast! How did you do it?
Most accounting firms are built in partnership structures. So they run two partners or ten partners or twenty partners.
We knew that to make effective decision making, which is a key aspect of being able to scale, we had to get away from that structure. So we’ve created a corporate structure. We run a board, a CEO, and we’ve got different heads of different functions. What that has allowed us to do is to bolt people into their structure and scale it quite easily.
Did you get any investment to grow?
We’ve just actually done a capital raising process to fund going to Australia and that concluded about a month ago.
Can you say where you got your investment from?
Broadly. Some existing staff and some external investors from around the Wellington market.
When you say external investors, how did you find them?
We just used networks. The amount of money we were seeking to raise meant that we could do it that way. We’re not massively capital hungry… we’re not building a tech company, so we don’t have a whole lot of developers building product. So networks worked for us. Obviously if you wanted to go higher, you’d need to get specialists involved.
So your next few years are mostly Australia?
New Zealand’s still huge. We‘ve got a lot of work to do in New Zealand. We’ve 12 regional partners now, we will probably look at literally multiplying that by about four. We’ve worked on a ratio of roughly 100,000 population per regional partner, so that means we’d go up to 40, 45 regional partners in New Zealand, with a supporting staff behind that, whilst we start Australia.
[In] Australia, we literally are just dipping our toe in that market now and it’ll take us 3, 4 years to really build it out.
What kind of intellectual property do you use in your business?
It’s all been developed in-house, so I guess it’s almost like an “internal know-how”.
We need to have repeatable process. And obviously to have repeatable process, we need to have it written down. We’re now just starting to get to a point where that written-down documentation. It’s all electronically stored but it needs a better way of filing it and managing it all, so we’re looking at software to do that.
Do you have registered trademarks for your name or any of your images?
Some of these are currently pending with an IP firm now but our primary logo is trademarked. Only in New Zealand.
When you use other people’s branding, say Xero’s, do you have to sign an agreement for that?
Yes, yes you do. So we essentially have a supplier agreement with Xero where obviously when we’re using their brand it’s got to be presented in a certain way etc. It’s part of our partner program agreement that we run with them.
Does that have certain conditions? Do they get upset about how you use their brand?
Well, they do if we were to misuse it! And that’s great. I’ve worked for some companies like Nike where really, the brand is everything. Yep, they would, if we suddenly changed the colors that we were using for their logos or changed the shape and form, I sure we would hear it really really quickly.
Where did you get most of your IP or legal advice when you were starting?
We’ve had some really good legal advice, generally, around setups and structures and the way we employ people and all that sort of stuff. And we’ve deliberately chosen probably a higher-end law firm. We use Minter-Ellison as our legal adviser and they’ve been exceptionally good.
Like all start-up businesses, most don’t have a lot of cash when they start off, so they don’t want to necessarily put IP protection in place for something that they kind of go “Let’s deal with that when we’ve got the cash flow to do it,’ and when there is something to actually protect.” We’re probably at that point now.
When do you think the right point is to protect your brand?
That’s a really good question. Look, unless you know you’ve got an absolutely amazing name, our name itself doesn’t mean anything. It’s really the brand that’s wrapped around it. But the name Xero, for example, it’s a cool name. You want to protect it, even when it had no intrinsic value.
So I don’t know. I think it’s sometime between when you start off and about now. So about three years into it, where you’ve got a bit of business, there’s a bit of a brand being built, there’s a bit of money flowing through the system. You start looking at putting some protection in place. Whereas most start-ups are bootstrapping like mad and they’re struggling to pay rent, let alone putting property protection in place.
Is there any advice you’d give to other people about IP apart from “worry about your cashflow first”?
Obviously, in a business like ours, our brand is everything. We don’t have – like if you look at our asset register, our asset register is a whole bunch of Macbooks, some desks, and not much else. So our brand is everything, and our brand is, in our case, … it’s all around the process, and the actual brand name and the logo and things itself. So yeah, I do think that there’s probably some merit in looking and trying to protect it.
So your current IP is mostly in the business model you use?
Our model is probably fairly innovative but even that, I mean, last year I spend quite a bit of time talking about it for Xero, to the Xero conferences around the world, and so I was talking to all these accountants and I took them through a half-hour presentation on our business and almost our business model. Now some people would say, “Gosh, you’re just giving away all your IP.” and to an extent, we sort of were. But actually it’s the ability to execute on it that’s where the IP is. The IP is very much tied up in the people who are actually doing this, as well. So you have to steal the people, not just “We’ve logged into the XX software and we know what the process is.”
So your IP advantage is your people…?
Our people are everything, without wanting to sound cheesy. Genuinely, that’s where the knowledge is.
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