MYOB has bought New Zealand company PayGlobal which makes payroll and HR software for mid-size businesses.
“We have 10 percent to 15 percent of the market (of businesses with 50-500 employees) that use a specialised entry-level ERP system,” MYOB CEO Tim Reed told Digital First. PayGlobal was “an opportunity to acquire a business that has complementary product capability and that brings scale to our business”.
PayGlobal makes between $15 million to $20 million in revenue and has about 500 customers. MYOB is a customer of PayGlobal.
The acquisition of the client-server software maker is part of a broader strategy of software solutions for the mid-market, Reed said.
“We have been investing in our enterprise division for a number of years – it has been the fastest growing component” of MYOB, Reed said. He said there were 80,000 businesses with 50 to 500 employees in Australia and New Zealand who were too big for small business accounting software but couldn’t afford to spend $150,000 to $200,000 on SAP or Oracle systems.
The centrepiece of MYOB’s unannounced mid-market strategy is cloud ERP platform Acumatica for which MYOB has an exclusive licence in Australia and New Zealand. The platform contains several layers some of which are ERP functions (general ledger, inventory, payroll, etc) and some are shared services.
MYOB will release a version of Acumatica under the MYOB brand with a mix of modules designed by MYOB as well as Acumatica.
“We’ve been investing quite heavily in our enterprise division SaaS solution which we haven’t yet released but we’ve been working on them for some time. The idea is that we will generate that next-gen solution for all our clients,” Reed said.
MYOB will continue to support and develop its server based solutions Exo Business and Exo Employer Services, Reed added.
While PayGlobal is not cloud software, elements of it will appear in MYOB’s next generation ERP.
MYOB has recently added programs to its portfolio under licence or white label agreements. It took a minority stake in online point-of-sale program Kounta and will sell the software as MYOB Kounta in a white-label deal.