The funding round: Harvey Norman’s secret startup, elite sport and HR grab more than $80 million


A mystery startup co-owned by multi-billion dollar Australian retailer Harvey Norman raises more questions than answers in this week’s round-up of major investment deals.

The company has generated more than $5 billion in franchisee sales and its latest financial report reveals that’s not all.

Also in this week’s exciting deals, innovative startups are disrupting the game for sporting clubs and human resources.

Read more: Recycling solutions, online lending and on-demand couriers win big in this week’s $15.7 million of exciting deals. 


What they do: One of Australia’s fastest growing software startups, MSL Solutions, acquires and sells digital platform solutions to some of Australia’s leading sport, yacht and golf clubs. Its current turnover exceeds $10 million.

Led by: CEO Craig Kinross

How much: Raised $16 million with new investment from Acorn Capital, Ellerston Capital, Eight Investment Partners and Regal Funds Management.

What happens now: MSL Solutions was aiming to raise $5 million earlier this year with plans to list on the ASX in the coming year, Financial Review reports.

But with an aggressive MNA approach to growth, the Brisbane startup extended the investment round to help fund the acquisition of data analytics firm Verteda and e-commerce platform Golf Box.

MSL Solutions already owns Micropower, iseekgolf, Zuuse and Golf Link Partners.

“It made sense for us to work with them and by acquiring these businesses it lets us go into international markets with a lower risk strategy,” Kinross told Financial Review.


What they do: With a vision to positively transform people management, Employment Hero provides a software solution for companies to improve HR processes while enabling employees to optimise their income.

Led by: CEO and founder Ben Thompson

How much: After initially raising $3 million, Employment Hero extended the series A round to bring on a further $1.5 million from new investor AirTree Ventures as well as existing backers OneVentures and AMP Ventures.

What happens now: Thompson says the company was already seeing incredible growth but he decided to bring on experienced investors to help him navigate it to the next level.

“We continue to add around 10,000 employees per quarter to the platform,” Thompson told StartupSmart.

“[The investment is] predominantly for building our development velocity and development team.”


What they do: Harvey Norman has been helping to build this retail startup in secret over the past two years but what it does and when it will hit the market remain largely unknown.

Led by: Former Harvey Norman CIO Kaine Scott and former Harvey Norman franchisee Phillip Rohan. Also owned by Harvey Norman Big Guys.

How much: In Harvey Norman’s latest financial report, it’s shown to have a 50% stake in the mystery retail joint venture titled “KEH Partnership”.

The report reveals that Harvey Norman has injected $61.82 million into the startup as a commercial advance to assist with the “working capital” of the startup’s operations.

“An impairment assessment was conducted resulting in the recognition of an expense of $11.56 million (2015: nil) in the 2016 financial year,” the report states.

Harvey Norman chairman Gerry Harvey has remained cryptic about the startup.

“It’s a venture which we’ve invested a fair bit of money in already but… if we pull this off it will be worth, $200, $300, $400 million,” Harvey told Sydney Morning Herald.

“And if we don’t, we’ll lose about $50 million.”

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Dinushi Dias is a journalist at StartupSmart and multimedia content producer. When she’s out of the office, she works on social projects with her We Love It Productions family and buddying filmmakers.