Invoice fraud detection platform Alii secures $2.5 million in pre-Series A

A Brisbane-based software company helping schools, firms and enterprise organisations mitigate the risk of being hacked and streamline their procurement process has raised $2.5 million in a pre-Series A capital round backed by Maranello Capital.

Alii’s latest capital injection comes one year after the company raised $1.6 million in a funding round backed by SeventyTwo Capital, and will be used to increase the company’s staff count by 18 - bolstering its customer engagement, sales, marketing and product development teams.

Founded in 2018, Alii is a fully automated end-to-end accounts payable solution with invoice fraud detection and also offers a centralised web interface that allows authorised employees to approve procurement requests.

Alii CEO Chamil Fernando said the market responded extraordinarily well to the Service-as-a-Software (SaaS) platform, with the company onboarding roughly eight to 10 new schools per month throughout 2022.

The boost in clientele came as data from Victorian schools such as Xavier College and Kilvington Grammar School were infiltrated by hackers last year, resulting in the theft of sensitive student data and financial information.

“It would be difficult to find a sector that has been exposed to a more dramatic tech upheaval over the last two years than education,” Fernando said.

“Online learning and the increased need for automated systems and program management, as well as secure operational and communications processes, have suddenly taken a front seat in operational priorities.

“Many schools that have attempted to adapt manual processes as a way of achieving 21st-century requirements are finding themselves in a vulnerable position due to a plethora of inefficiencies and fraud-related issues. School communities are particularly susceptible to these.”

Alli claims its clientele - which includes Maurice Blackburn Lawyers, All Saints Anglican School and Brisbane Boys' College - has increased by 240 per cent over the last 12 months, effectively tripling the group’s client base.

The company also claims to have recorded a 300 per cent growth in revenue, with the latest raise lifting its post-funding valuation to $10.25 million.

According to the Australian Cyber Security Centre’s (ACSC) annual Cyber Threat Report 2021-22, cybercrime cost Australian businesses $98 million last financial year, with medium-sized businesses the hardest hit.

Some 76,000 cybercrimes were reported throughout last year, reflecting a year-on-year increase of 13 per cent. Medium sized businesses lost an average of $88,000 for every crime reported, while small businesses lost $39,000 and larger corporations were typically hit with a $62,000 loss.

“Alii has a solid value proposition and is experiencing unprecedented demand in a sector that is grappling with the issue of fraud whilst at the same time striving to achieve efficiencies through system automation,” said Maranello Capital director Richard Majlinder.

“Given the substantial growth and high-profile clients joining the business. It is a great story with exceptional potential, both in Australia and overseas.”

To date, Alii has processed more than 900,000 invoices annually for clients across Australia and New Zealand.

“Alii growth projections target a 60 per cent penetration of the independent and private school market in 3-5 years. This excludes growth recorded in adjacent sectors such as not-for-profit and legal,” Alii chairman Gordon Tan said.

“The company’s recent funding package will serve to catapult our growth throughout Australian and New Zealand markets and then into other regions and sectors.

“We expect to see continued growth over the next twelve months as our transformational technology takes hold.”

Ruyton Girls’ School director of business Tim Rowler added that smart schools are now moving fast and those that resist automation will be left behind.

“There is traditionally a significant amount of time loss and expense due to data entry within school environments. As the business world evolves around us, school information systems do not match the modern work environment in terms of systems, processes and cyber risk,” he said.

“This reality hit the sector particularly hard over the last few years and schools are now screaming for modern business systems.

“Where Alii stands out is its capacity to integrate and modernise current systems without requiring a complete overhaul. It has allowed our team to spend time on high-value tasks while providing better reporting and financial delegations, as well as mitigating against email hacking.”